Powering growth - Aztech Group Ltd - Investor Relations

Powering GrowthAnnual Report 09

Contents02 Financial Highlights04 Financials At A Glance05 Value-added Statement06 Letter To Shareholders08 Board Of Directors10 Senior management11 Operations Review (Electronics)15 Operations Review (Az United)15 Operations Review (Az Marine)18 Our Commitment20 Financial Calendar21 Corporate Governance31 Financial StatementsCorporate InformationCEO/CHAIRMANMichael Mun Hong YewDIRECTORSMichael Mun Hong YewMartin Chia Heok MiinPatricia Ng Sok ChengJeremy Mun Weng HungPhilip Tan Tee YongColin Ng Teck SimKhoo Ho TongLEAD INDEPENDENTDIRECTORPhilip Tan Tee YongAUDIT COMMITTEEPhilip Tan Tee Yong (Chairman)Colin Ng Teck SimKhoo Ho TongNOMINATING COMMITTEEColin Ng Teck Sim (Chairman)Khoo Ho TongMichael Mun Hong YewREMUNERATION COMMITTEEKhoo Ho Tong (Chairman)Philip Tan Tee YongColin Ng Teck SimCOMPANY SECRETARIESPavani NagarajahPradeep Kumar SinghAUDITORSDeloitte & Touche LLP6 Shenton Way, #32-00DBS Building, Tower TwoSingapore 068809Alan NisbetPartner-in-chargeAppointed March 30, 2007REGISTRARB.A.C.S Pte Ltd63 Cantonment RoadSingapore 089758REGISTERED OFFICE31 Ubi Road 1Aztech BuildingSingapore 408694COMPANY REGISTRATION NO.198601642R

AztecH’S GLOBAL REACHAztech at a glanceAztech ElectronicsAz UnitedAz MarineAztech builds on its core competencies in the design and manufacture of Broadband, Home Networkingand LED lighting products with commitment to uphold the Aztech branding position in the electronicssector. With our vertically integrated manufacturing plant in Dong Guan, China together with 6 globalsales offices, Aztech pushes the boundaries of the development of innovative and stylish productsthrough services of ODM/OEM, Retail Distribution and Contract Manufacturing.Further to strengthening foundations, Aztech works towards expanding our capabilities bycreating new avenues for growth. Az United was established in 2008 to procure and supplymaterials to the building and construction industry.Beyond assuring business versatility, Aztech continuously ensures progress towardsgreater success. Setting off to establish the same brand of excellence in newmarkets, our new subsidiary, Az Marine, provides a wide range of marine-relatedservices – affirming our commitment to further shareholders’ interests.

a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l H i g h l i g h t sFinancial HighlightsGroup Turnover (S$’M)Net Profit (S$’M)300250200150178.6239.0268.3276.5280.320151010.120.0 18.212.215.4100505005 06 07 08 09005 06 07 08 09Shareholders’ Equity and Total Assets (S$’M)Earnings Per Share (Cents)2001501005064.6138.8200.2168.6150.280.9 89.6 94.9112.3195.1543212.54.94.53.03.8005 06 07 08 09005 06 07 08 09Shareholders’ EquityTotal Assets

F i n a n c i a l H i g h l i g h t sa z t e c h a n n u a l r e p o r t 2 0 0 9EBITDA (S$’M)Dividend payout ratio and gross dividend3530252015105018.132.4 31.324.705 06 07 08 09Operating Cash INFlow AndCash and Cash Equivalent (S$’M)30.4100 80 60 40 20 0 1 2 3 4050607080919.8% 0.5030.4% 1.5039.3% 1.7566.4% 2.0046.7% 1.75Dividend payout ratioGROSS dividend(cents/Share)Return on Equity and Total Assets403020104.515.323.129.228.736.218.537.6 37.3 36.125201510515.7%7.3%24.8%13.3%20.3%10.8%12.9%6.1%13.7%7.9%005 06 07 08 09005 06 07 08 09Operating cash INflowCash and Cash Equivalentreturn on EquityReturn on Total Assets

a z t e c h a n n u a l r e p o r t 2 0 0 9f i n a n c i a l s a t a g l a n c efinancials at a glancefor the year ended December 31, 20096%64%36%26%25%Materials SupplyAND Marine logisticsElectronicsAmericaEuropeAsia PacificOthersturnover bybusiness segmentsFY200943%turnover bygeographical segmentsFY20092009 2008 2007 2006 2005S$’000 S$’000 S$’000 S$’000 S$’000R e s u l t sRevenue 280,267 276,453 268,310 238,997 178,584EBITDA 30,424 24,746 31,286 32,435 18,092Net profit for the year 15,418 12,233 18,177 20,038 10,128Net cash (outflow) inflow (1,148) 1,109 7,000 13,852 5,668A s s e t s a n d l i a b i l i t i e sNet current assets 35,847 32,862 50,079 52,320 24,088Total assets 195,142 200,198 168,583 150,188 138,824Total liabilities 82,811 105,300 78,937 69,282 74,179Total borrowings 49,400 69,634 28,065 20,026 43,595Shareholders’ equity 112,331 94,898 89,646 80,906 64,645P e r s h a r e b a s i s ( i n c e n t s )Earnings - basic 3.75 3.01 4.45 4.94 2.53Gross dividend 1.75 2.00 1.75 1.50 0.50Net asset value 23.04 23.78 21.86 19.78 16.07R a t i o sNet profit margin 5.5% 4.4% 6.8% 8.4% 5.7%Current ratio 1.58 1.43 1.72 1.82 1.43Dividend payout ratio 46.7% 66.4% 39.3% 30.4% 19.8%Dividend cover 2.14 1.51 2.54 3.29 5.06Gearing ratio 44.0% 73.4% 31.3% 24.8% 67.4%Return on assets 7.9% 6.1% 10.8% 13.3% 7.3%Return on equity 13.7% 12.9% 20.3% 24.8% 15.7%

V a l u e - a d d e d s t a t e m e n ta z t e c h a n n u a l r e p o r t 2 0 0 9Value-added statementfor the year ended December 31, 2009Value added statement is the wealth created by the Group by applying its goodsand services. This statement shows the total wealth created and how it was allocated.To remunerate employeesto GovernmentTo Maintain Operation and expand the groupTo reward Providers of capital6%20%37%21%31%2%37%FY200946%FY20082009 2008 ChangesS$’000 S$’000 %Revenue 280,267 276,453Suppliers of materials and services (236,711) (229,016)Gross value added from operations 43,555 47,437Gain (loss) on revaluation of investment properties 1,144 (2,650)Other operating income 3,487 3,533Exchange gain (loss) 1,158 (1,605)Total value added 49,345 46,715 5.6%Applied as follows:To remunerate employees- Salaries, wages and other benefits 18,423 21,596 (14.7%)To government- Taxation 3,118 758 311.3%To reward providers of capital- Dividend to shareholders 8,117 8,019- Interest on borrowings from banks 1,717 1,8929,834 9,911 (0.8%)To maintain operation and expand the group- Depreciation and amortisation 10,669 10,236- Net earnings retained 7,301 4,21417,970 14,450 24.4%49,345 46,715 5.6%Value added ratiosNumber of employees 1,413 2,093 (32.5%)Value added per employee ($’000) 35 22 59.1%Value added per $ of employment cost 2.68 2.16 24.1%Value added per $ sales 0.18 0.17 5.9%Value added per $ of investment in property,plant and equipment 0.47 0.54 (13.0%)Cost of property, plant and equipment 104,874 86,644 21.0%

a z t e c h a n n u a l r e p o r t 2 0 0 9L e t t e r t o s h a r e h o l d e r sLetter To ShareholdersDear Shareholders,I am pleased to share that we have performed well again. Despite the evidentuncertainty in the global economy, the Group had done well and remained profitable inall our business sectors for the seventh consecutive year. We achieved a turnover ofS$280.27 million in FY2009 with net profit of S$15.42 million.These positive results reaffirmed the soundness of the diversification strategy that weembarked on last year. It also demonstrated our resilience against adversity.Today our strengths lie in our multi-disciplined businesses involving electronics,materials supply and marine logistics. The diversification strategy allows the Groupto generate revenue stream across various business sectors that can cushion anyrevenue instability in the challenging business climate. It also enables us to enhanceshareholders’ value.The Year in ReviewAgainst the backdrop of a challenging and highly competitive globaleconomy, many businesses were badly hit. However, instead of sharing asimilar plight, we managed to report a stronger FY2009 with growth on allfronts – total revenue, net profit and earnings per share.While the revenue increased marginally from S$276.45 million in FY2008 toS$280.27 million in FY2009, reflecting an increase of 1.4%, our net profitsaw a significant year-on-year improvement of 26.0%, from S$12.23 millionin FY2008 to S$15.42 million in FY2009. Correspondingly, our earnings pershare also increased 24.6% from 3.01 cents in FY2008 to 3.75 cents inFY2009.The Group’s performance for the year is a reflection of the effectiveness ofthe financials and various cost management measures that we implementedin the year. The cost optimisation efforts carried out by the Group andpolicies implemented to yield better operational efficiency improved theGroup’s selling and distribution costs, administration expenses and financialcost.Like FY2008, we maintained a healthy balance sheet with a positive netasset position of S$112.33 million in FY2009, thanks to the prudentfinancial discipline that we exercised. Our financial ratios remained healthycontrary to the belief that diversification would pose financial stress on theGroup. Our working capital management also improved.Cash flow position of the Group stayed healthy too. In FY2009, wegenerated net operating cash inflow of S$37.27 million. This representedan increase of 101.0% over S$18.55 million in FY2008. Our focus onquality customers and receivables, as well as the improvement in inventorymanagement, shortened the cash conversion cycles, bolstering the cashflow position of the Group.Overall, FY2009 was a fruitful year. After one full financial year of operation,we saw significant results from Az United Pte Ltd and Az Marine Pte Ltd.These achievements not only enhanced our shareholders’ value. On amore strategic level, the success of the materials supply and marinelogistics sectors effectively moved the Group a step closer to our vision oftransforming into a multi-disciplined corporation. We have also becomemore resilient and less dependent on the volatile electronics sector.Aztech Group BusinessesIn FY2009, we continued the momentum in FY2008 and proactively soughtout opportunities in the materials supply and marine logistics businesses.Concurrently, we proactively expanded our product line in the electronicssector through the exploration of product diversification. These multiprongedmeasures strengthened our core competencies and, at the sametime, enhanced our resilience against the macro environment.Electronics (Aztech)Still our largest revenue contributor, the electronics sector recorded arevenue of S$180.10 million and remained profitable. However, affected bythe adverse global economy, this represented a decrease of 28.8% over therevenue in FY2008.Operationally, Aztech expanded horizontally into the design and manufactureof energy-saving, long-lasting and eco-friendly LED lighting productsto leverage on the growing market opportunity. Under this initiative, welaunched a line of Aztech LED luminaries products under our new subsidiary,AZ E-lite Pte Ltd. We will leverage on the strength and experience of ourR&D team to design superior and innovative products.In the broadband and home networking product category, we continued toinnovate with new product developments. We designed the World’s FirstEco-friendly 200Mbps HomePlug AV Ethernet Adaptor (Aztech HL110E) andthe World’s Smallest 85Mbps HomePlug Turbo Ethernet Adaptor. For the

L e t t e r t o s h a r e h o l d e r sa z t e c h a n n u a l r e p o r t 2 0 0 9Fibre-To-The-Home (FTTH) market, we also have plans to launch a GPONOptical Network Terminal (ONT) device for lightning-fast connection speed ofup to 1Gbps.Materials Supply (Az United) and Marine Logistics (Az Marine)In FY2009, the Az United and Az Marine businesses increased theircontribution to the Group’s turnover from 8.5% (S$23.46 million) in FY2008to 35.6% (S$99.66 million) in FY2009. They added S$7.10 million profit tothe Group in FY2009 with the project completion.Although Az Marine was also affected by the harsh operating environment,we altered our operational strategy by diversifying our service portfolio tobeyond ship owning. In the year, Az Marine’s fleet increased to 21 vessels.For Az United, we were able to complete our contractual delivery schedule.This accounted for the positive contribution to our profit.Looking AheadAlthough the global economy is on the recovery mode, we will continue toadopt a proactive stance towards capitalising on emerging opportunities inour business environment. With a strong management team and committedstaff, we are confident that we will be able to overcome operatingchallenges, craft out a brighter future and continue to produce resultsacross times.a possible feat because of our team of committed managers and staff. Wewould therefore like to take this opportunity to express our appreciation tothem.Beyond internal support, the support and contribution of our customers,business partners and shareholders are also pivotal to our achievementstoday. We will continue to work closely with them, nurturing win-win workingrelationships.In the year ahead, we will press on to capitalise on our diversificationstrategy, with the greater objective of achieving revenue and profitgrowth and enhancing shareholders’ value. We are confident thatwith the unwavering support from our customers, business partners,shareholders, management and staff, we are poised to realise our vision– EMPOWERING GROWTH.Michael MunGroup CEO and ChairmanIn the year ahead, we will also be looking to answer the government’s callfor a workforce with improved productivity and capability by reviewing andstreamlining our processes to do things right and effective the first time.In the electronics sector, our foray into LED lighting products represented anew and exciting area of business with a lot of growth potential. We will belooking to secure more projects in LED lighting in both public and privatesectors.As for the materials supply and marine logistics businesses, we will adopt aflexible strategy by continuing to seek contracts in building and constructionmaterials for public and private infrastructure projects.Finally, in line with the long-term strategy of diversifying our business, weare exploring to venture into the property development, building constructionand property management businesses. The economic growth in theAsia-Pacific region has led to an increase in the demand for services inthe identified areas. Therefore, this new venture is expected to have brightprospects in Singapore and the region.Dividends PayoutAs we look to better our performance in the business sectors, we arecommitted to build and deliver sustainable value to our shareholders.With that in perspective, for the sixth consecutive year, we propose a finaldividend of 1.25 cents. This added onto the interim dividend paid in August2009 of 0.5 cents brings the total distribution of dividend for FY2009 to1.75 cents per share.An AppreciationCertainly, FY2009 had a good share of challenging moments. However, wehave managed to emerge stronger both financially and operationally. This is

a z t e c h a n n u a l r e p o r t 2 0 0 9B o a r d o f D i r e c t o r sBoard of directorsMichael Mun Hong YewGROUP CEO ANDCHAIRMANMartin Chia Heok MiinEXECUTIVE DIRECTORSENIOR VICE PRESIDENTPatricia Ng Sok ChengEXECUTIVE DIRECTORSENIOR VICE PRESIDENTMr Mun is one of the co-founders ofthe Company. He started Aztech in1986 and transformed Aztech froma PC maker to a multi-disciplinedcompany that focuses on Broadbandand Home Networking productswith in-house R&D and full-fledgedmanufacturing facilities in DongGuan, China.Mr Mun is responsible for theoverall strategy and direction of theGroup and is instrumental for thediversification to Materials Supplyand Marine Logistics businesses.He is a member of the NominationCommittee.Mr Chia joined Aztech in 1989 andwas appointed as the Director ofthe Board in 2006. He is currentlyresponsible for the productmarketing and sales activities ofthe Electronics Sector of the Group.Mr Chia is also involved in themanagement of the Group’s newbusiness sectors of Materials Supplyand Marine Logistics. He holdsdirectorships in several of Aztech’ssubsidiaries.Ms Ng joined Aztech in 1986and was appointed as theDirector of the Board in 1993.She is currently the GeneralManager of Shiro CorporationPte Ltd (“Shiro”), a wholly-ownedsubsidiary of Aztech. Ms Ng hasmore than 20 years of experiencein Business Development,Marketing and Sales. She isresponsible for the overall businessdevelopment of Shiro. Ms Ng holdsdirectorships in some of Aztech’ssubsidiaries.

B o a r d o f D i r e c t o r sa z t e c h a n n u a l r e p o r t 2 0 0 9Jeremy Mun Weng HungEXECUTIVE DIRECTORVICE PRESIDENTPhilip Tan Tee YongLEAD INDEPENDENT DIRECTORCHAIRMAN OF AC AND MEMBER OF RCKhoo Ho TongINDEPENDENT DIRECTORCHAIRMAN OF RC AND MEMBER OF ACAND NCColin Ng Teck SimINDEPENDENT DIRECTORCHAIRMAN OF NC AND MEMBER OF RCAND ACMr Jeremy Mun joined Aztech in2002 and was appointed as theDirector of the Board in 2006.He is in charge of managing themanufacturing operations ofAztech Dong Guan factory. Hisresponsibilities include overseeingfactory efficiency, procurementand purchasing, human resourceand finance of the plant. He holdsdirectorships in some of Aztech’ssubsidiaries.Mr Tan is the owner and ManagingDirector of PTOS SingaporePte Ltd. He is a Fellow of theChartered Institute of ManagementAccountants and a CPA. He hasover 40 years of experience inbanking, accounting, finance,marketing and sales, commercialand banking software development,consulting, manufacturing andentrepreneurship. Mr Tan was aMember of Parliament for 2 termsaggregating 7 years.Mr Khoo is a practising PublicAccountant for over 20 years. He isthe Institute treasurer and a councilmember of various sub-committeesof the Institute of Certified PublicAccountants, Singapore. MrKhoo is the Treasurer and Councilmember of the Asean Federation ofAccountants.Mr Ng is a practising lawyer withover 20 years of experience. Hispractice focuses on corporatebanking and finance. Mr Ng wasadmitted as an advocate andsolicitor of the Supreme Courtof Singapore in 1982 and as asolicitor of the Supreme Court ofEngland & Wales in 2000. Heobtained a Master of BusinessAdministration (Accountancy) in2007 from Nanyang TechnologicalUniversity and is a Notary Publicand a Member of the SGX-ST’s andCatalist’s Appeals Committee.

10a z t e c h a n n u a l r e p o r t 2 0 0 9S e n i o r M a n a g e m e n tSenior ManagementMichael Lee Thiam Seongsenior Vice President,Strategic AllianceMr Lee joined Aztech in 2006.He is responsible for developingstrategic alliances for the Groupand assisting in the managementof new businesses undertaken bythe Group. He brings with him over18 years of business, corporateand financial expertise. He holdsa Bachelor’s degree in Accountingwith Computing from University ofKent, Canterbury, United Kingdom.Jason Saw Chwee MengVice President,Research AND DevelopmentMr Saw joined Aztech in May 2005.He is responsible for the planning,coordination, and execution ofproduct designs and developmenthandled by the R&D Centres andheads the technical support serviceteam for the related products. Heholds a Diploma in ElectronicsEngineering from Ngee AnnPolytechnic.LOW WEI CHONGVICE PRESIDENT,RESEARCH AND DEVELOPMENTMr Low joined Aztech in 1994.He is responsible for identifyingtechnology and strategic planningof products in the new technologyarea. He holds a Diploma inElectronic Engineering and anAdvanced Diploma in Computer &Communication Systems from NgeeAnn Polytechnic.Herman So Kam HungVice President, FinanceMr So joined Aztech in 2003. Heis responsible for the Group’sfinancial management and treasuryfunctions. Mr So has over 10 yearsworking experience in the finance,accounting and auditing fields.He holds a Bachelor’s degreein Accountancy from MonashUniversity, Australia. He is also anassociate member of the HongKong Institute of Certified PublicAccountants and a member of CPAAustralia.Pavani NagarajahVice President, Legal andCorporate AffairsMs Nagarajah joined Aztech in1998 and heads the legal andcorporate secretarial department,managing all legal matters ofthe Group. Ms Nagarajah alsoheads the departments of InvestorRelations and Corporate HR, andis the Company Secretary andthe Secretary of Aztech’s Audit,Nominating and RemunerationCommittees. She holds a Bachelor ofLaws (Hons) degree and a GraduateDiploma in law from the NationalUniversity of Singapore.Sylvester Saw Cheng SanSenior Director, InformationTechnologyMr Sylvester Saw joined Aztechin 1996. He is responsible for theGroup’s Information Technologyand Communication managementand planning. Mr Saw has over20 years of working experience inthe IT field. He holds a Diploma inComputer Studies from Universityof East London (formerly North EastLondon Polytechnic).

Operations ReviewAztech ElectronicsAztech Electronics business comprises the design and manufacture ofelectronics, communications equipment and LED lighting products. With itsvertically integrated manufacturing plant in Dong Guan, China, togetherwith 6 worldwide sales offices and 4 R&D centres, Aztech provides servicesof ODM/OEM, Contract Manufacturing and Retail brand distribution.12 31. Aztech HW550-3G: 3G Wireless-N Router2. Aztech HL110E: World’s First Eco-friendly200Mbps HomePlug AV Ethernet Adaptor3. Aztech HL106E: World’s Smallest85Mbps HomePlug Turbo EthernetAdaptor54. Aztech LED Luminaire: LED Downlight5. Aztech LED Luminaire: 2-feet and 4-feetLED Lighting4

12a z t e c h a n n u a l r e p o r t 2 0 0 9o p e r a t i o n s r e v i e wAztech products at one of Singapore’sleading retailer, Challenger Superstore (FunanDigitaLife Mall)State-of-the-art manufacturing facilities at our factory in Dong Guan, ChinaWith 23 years of experience in the electronicsbusiness, Aztech has built a strong reputationfor its OEM/ODM, Retail Distribution andContract Manufacturing business in thebroadband, home networking and LED lightingproducts.In FY2009, the electronics sector continued to be the main revenuecontributor to the Group’s revenue with S$180.10 million (representing64.3% of Group Revenue). Grounded with strong operating fundamentals,we were able to mitigate the impact of the adverse operating environmentand remained profitable.We were able to sustain our performance largely because of our teamof competent and committed staff and the set of measures that wereimplemented.Focusing on Profitable MarketsOEM/ODMAztech continued to work closely with telecommunications companies andInternet Service Providers (ISP) on the manufacturing of ADSL modems.Particularly, in Singapore, we supplied to the largest telco, SingTel, our4-port ADSL modem (Aztech DSL1000ER) for their very successful mioTV package that allows home users to watch video via Internet ProtocolTelevision (IPTV).Contract ManufacturingContract manufacturing is a key part of our electronics business. Whensecuring manufacturing contracts for Aztech ADSL, 3G to Wireless Routersand HomePlugs, we looked to find products that require higher valueaddedmanufacturing and tap on our state-of-the-art manufacturingfacilities, as this enabled us to yield a better profit margin. Sustaining ourexisting working relationship with Etisalat (UAE), SingTel (Singapore), GlobeTelecom (Philippines) and TTNet (Turkey) was also our top priority.Aztech Brand ProductsAztech products reach more than 30 countries worldwide, with Europe,USA and Asia Pacific constituting the largest markets. In the year, tocounter the depressed prices for electronic products in the recessionstruckcountries, we focused our efforts on selling Aztech brand productsthrough our distributors in markets such as Singapore, Malaysia, HongKong, Thailand, Vietnam, Pakistan, Sri Lanka, Saudi Arabia, UAE, Turkey,Israel and Latin America. This strategic move enabled us to leverage on thegrowth of these markets to broaden our customer base as well as provideus with better profit margin.Complementing this strategic move, the marketing efforts in thesecountries were intensified to create greater brand awareness. Oneexample of the marketing activities was the sponsorship of events targetedat tertiary students, who are potential customers deciding on the purchaseof home networking and broadband devices.Notably, our HomePlugs which allow users to transfer data via powerlineand our 3G Wireless routers were very popular as more users seek tocreate and share their own WiFi hotspot when they are outdoors.

o p e r a t i o n s r e v i e wa z t e c h a n n u a l r e p o r t 2 0 0 913High-speed SMT LineLight Spectrum AnalyserAztech products at Harvey Norman store inKuala Lumpur, MalaysiaProduct AccoladesIn the year, our simplified Aztech HW550-3G Wireless-N Mobile BroadbandRouter received many awards and good reviews with its user-friendlinessand compatibility with 3G/3.5G USB modems in the market. Somecomments and accolades included:“3G sharing… It’s a great concept. Do get one if you can.” - PC.comRecommended Award“The Aztech HW550-3G is simply a fantastic device; it will be tough tofind something as flexible and as powerful” – MAX IT Magazine Max ValueAward“We love the Aztech HW550-3G wireless router for its ability to supportmobile HSPA modem.” – CHIP Magazine Recommended Award“Aztech came in at the right time with a proper 3G USB broadband routerthat everyone has been eyeing for.” - OC Workbench Best Value AwardOther products launched in the year include:• Aztech HL110E: World’s First Eco-friendly 200Mbps HomePlug AVEthernet Adaptor• Aztech HL106E – World’s Smallest 85Mbps HomePlug TurboEthernet AdaptorLED LightingTowards the end of the year, we ventured into the design and manufactureof energy-saving, long-lasting and eco-friendly LED lighting products.The move for Aztech’s new subsidiary, AZ E-lite Pte Ltd to design andmanufacture LED lighting equipment – named Aztech LED Luminaries –is driven largely by the bright potential LED lighting has on both thebusiness and natural environments. According to market research, LEDlight presents a lead market advantage in the next 5 years as it replacesincandescent lighting progressively by 2016. As part of our R&D efforts,we have invested in a Light Spectrum Analyser to analyse the amountof light from light source, as well as analyse colour rendering and powerrequirement of the light fitting.Meeting our Customers’ NeedsAlthough ADSL products continue to be Aztech’s best-selling product forOEM/ODM and many telcos and ISPs continue to use Aztech’s design, wesought to stay ahead of the market demands through our Research andDevelopment (R&D) efforts.Riding on the increasing adoption rate of Next Generation Network (NGN) inmany countries, the Group embarked on fibre optic modem development incollaboration with Agency for Science, Technology And Research (A*STAR).The research collaboration seeks to develop a 2.5Gbps Gigabit PassiveOptical Network (GPON) system for the Next Generation Fibre-To-The-Home (FTTH) Network, which will greatly enhance our core capabilities inbroadband and home networking products.

14a z t e c h a n n u a l r e p o r t 2 0 0 9o p e r a t i o n s r e v i e wRobotic arms at the plastic injection facility in Dong Guan, ChinaHeat exchange system to provide hot water for the dormitoriesOther ongoing research efforts include the design of cost competitiveproducts for broadband communication and home networking devices andthe incorporation of GREEN feature into our products. We have successfullyincreased the communication speed of our home networking devicesto 1Gbps. We have also explored the use of power efficient electroniccomponent and eco-friendly material, as well as the reduction of powerconsumption when the product is not in use.Improving on Current ProcessesWith the objective of increasing productivity and improving quality, Aztechinstalled robotic arms at the plastic injection facility in Dong Guan, China.This effectively enabled the automatic removal of parts from the machineat a set parameter, giving consistent output as compared to manualremoval by operator.In line with Aztech Green Movement, we have installed a heat exchangesystem to provide hot water for the dormitories instead of burning dieselfor water heating. This is both cost effective and environmentally friendly.China to ensure the teams are focused in their respective core competencyand no duplication of work is carried out. The R&D has also been mandatedto give priority and invest the resources on design and/or developmenttasks where the sales interest from prospective customers was high and forsecured orders. These moves are targeted to improve R&D’s efficiency andinput in the long run.ManpowerIn addition, we strived to keep the staff turnover low so that correspondingtraining costs could be kept to a minimal. To address the issue, we workedto improve the factory workers’ welfare by organising monthly birthdayparties, providing more recreational activities and installing a hot watersystem in their dormitories.Moving ForwardAlthough the economy looks to be on the recovery path, we will continue ourstrategic efforts in the various areas. In addition, we actively seek to bringabout greater product breakthroughs and innovations to power growth.Streamlining Operating CostsAs part of the effort to counter the slowdown in economy, we kept themanpower lean and stayed very focus on our objectives. For instance,R&D activities were streamlined in our R&D centres in Singapore and

Operations ReviewAz Marine / AZ UnitedAz Marine, a wholly owned subsidiary of Aztech Group, was incorporatedto develop and manage the business of Marine Logistics. Its primarycharter is chartering of vessels, such as tugboats and barges, and othermarine-related services.Az United’s business is in the procurement and supply of materials for thebuilding construction industry and infrastructure development projects.Az Sakura2,800BHP ocean-going tug built in 2009Az Orchid2,400BHP ocean-going tug built in 2007Materials supply business under Az United Pte Ltd

16a z t e c h a n n u a l r e p o r t 2 0 0 9o p e r a t i o n s r e v i e wAz Sunflower3,600 BHP ocean-going tug built in 2008As part of the Group’s diversification strategy,Az United Pte Ltd and Az Marine Pte Ltd wereset up in 2008 to target the materials supplyand marine logistics business respectively.Having been in operation for one full financialyear, both subsidiaries have made significantprogress, contributing a total of S$99.66million to the Group’s revenue and S$7.10million to the Group’s profit.In comparison to FY2008, Az United and Az Marine increased theircontribution to the Group’s turnover from 8.5% to 35.6% in FY2009.This proved that the diversification strategy has paid off.Az MarineAz SunflowerAz Marine was set-up as a marine logistics 3,600BHP business ocean-going unit of the tug Group, built in 2008with its mandate being ship owning, offshore vessel chartering, towingand transportation, ship chandling, agency services and vessel brokerage.Az Marine has since expanded to encompass full marine logistic servicesand is now well-positioned to scout for additional business outside of theGroup. Being a new marine division, efforts have been put in to developand implement a good operations system and policy. The team is taskedto ensure the systems are continuously updated and that the vessels arewell maintained to achieve functional and operation efficiency as a whole.In the year, Az Marine continued to be the logistics arm for Az United in thesupply of construction materials. In addition, we also chartered out some ofour tugs and barges for transportation of cargo around Southeast Asia andprovided harbour tug services for some of our local clients.Az Marine currently owns and operates 11 tugs ranging from 2200BHPto 3600BHP and 10 barges between 300ft to 365ft. We have in our fleeta 150T crane barge that can support a wide range of salvage, repairand hoisting operations. We also have our own launcher to facilitate ouroperations within Singapore anchorages.

o p e r a t i o n s r e v i e wa z t e c h a n n u a l r e p o r t 2 0 0 917Az Xiamen365ft deck cargo barge built in 2009Az Carnation3,200BHP ocean-going tug built in 2008Az Chengdu365ft deck cargo barge built in 2009Az Hercules3,000BHP self-propelled floating crane built in 2005Reacting to the economy slowdown in FY2009, we took this opportunityto work on our annual maintenance programmes to ensure operationalreadiness when the market recovers. In addition, we altered ouroperational strategy by diversifying our service portfolio beyond shipowning to include ship management, crew management, vessel agency,ship chandling and ship brokerage services.Az Marine’s vertical integrated system allows us to provide our customersa one-stop centre to manage their vessels. Our ship managementservices range from crewing, technical management, HSSEQ to newbuilding management. We also innovate the sales and purchase process,which includes having a structured financing or leasing.Az UnitedAz United’s business is in the procurement and supply of materials for thebuilding construction industry and infrastructure development projects.We have successfully registered as a L6 Graded contractor with theSingapore’s Building & Construction Authority (BCA) under the basicbuilding materials category. This carries a stamp of approval to bid andtender for projects with unlimited tender limit.With this success, we will strive for greater heights. Az United is continuingto explore opportunities outside of Singapore and expand its serviceportfolio. With a united mindset, we see no boundaries.Going forward, Az Marine will continue to enhance and expand our currentlogistics services and recruit additional manpower to strengthen ouradministration and crew management so as to optimise fleet operations.Az Marine plans to achieve the International Safety Management (ISM)Code Certification in 2010 to further enhance its service quality andsafety management.Az Marine will also look at venturing into new areas such as theoil and gas industry, leveraging on Singapore’s status as a globaltransshipment port. It is with this dynamic spirit that powers the youngdivision for future growth.

18a z t e c h a n n u a l r e p o r t 2 0 0 9o u r c o m m i t m e n tOur CommitmentAztech at “Walk for Our Children” event organised by Singapore Children’s SocietyThe Group and staff donated $10,000 to aidthe Typhoon Morakot relief efforts in TaiwanAztech strongly supports student activities with sponsorship ofevents, one of which is the Nations Cup, International NetballCompetition at Toa Payoh StadiumTo Our ShareholdersThe Group remains committed to maintaining open communicationswith shareholders, analysts and interested parties, and encouragingengagement with its senior management.During the year, the Group released quarterly, interim and full-year resultsto the public on the average within 26.5 days of period end, and allmaterials relating to results and presentations were immediately madeavailable on our website, after mandatory posting with the SingaporeExchange (SGX).Through the investor relations team, the Group responded to enquiriesfrom shareholders, media and other interested parties. The website ofthe Group is regularly updated during the year, making it possible for theshareholders to stay on top of the latest happenings of the Group.To Our CommunityIn keeping with the Group’s philosophy to give back to the society, theGroup showed our support for the community through participating invarious community events and initiatives.“Walk for our Children”Led by our Group CEO, Mr Michael Mun, a total of about 50 people,including staff, family members and friends, took part in the annual walkcum-carnivalevent organised by the Children’s Society. The event held on27 July 2009 was a 2.4km walk around Chinese Garden and JapaneseGarden. A total of S$3,000 was raised through the event for needy childrenand youth of all races and religions.Blood Donation DriveAztech initiated a blood donation drive among its staff in the Singaporeoffice and the tenants at the Aztech building. The group reported at RedCross’ blood bank to make the donation. Consisting of both regular andfirst time donors, the participants were united with one aim to increaseblood deposits that could save more lives.Typhoon Morakot DonationEmpathising with the victims of Typhoon Morakot, the Group and staff didtheir bit by contributing funds to the disaster relief efforts in Taiwan. A totalof S$10,000 was raised in the exercise.Youth SponsorshipAztech actively engages in sponsorship of student activities, such astertiary institution open houses, Nations Cup - International NetballCompetition, and Ngee Ann Polytechnic Youth for Causes Charity event.

o u r C O m m i t m e n ta z t e c h a n n u a l r e p o r t 2 0 0 919Staff were given eco-friendly Aztech bags on the launch of Aztech Green Movement DayAztech monthly Fruit DayAztech staff taking part in theBlood Donation DriveAztech launched a Green Movement Driveto play a part for our environmentTo Our EnvironmentAztech Green Movement DriveWith increasing focus on the well being of the environment, the Groupinitiated a Green Movement Drive with the goal to reduce carbon footprintand develop environmentally-friendly products to preserve Earth’s preciousresources. We also launched a newsletter that touches on the three Rs(Reduce, Reuse, Recycle). Another green effort was the installation of aheat exchange system at our plant in Dong Guan, China to provide hotwater for the dormitories instead of burning diesel for water heating.Participation in Earth Hour 2009In response to the global Earth Hour campaign, the Group turned off thelights in our head office in Singapore during Earth Hour. Nonetheless, weensured that our OH&S guidelines/standards and emergency lighting andsecurity systems were adhered to and remained on as normal.To Our PeopleStaying true to our philosophy, the Group continuously looks to develop thepotential of our staff through nurturing and upgrading their skills.the staff in building and improving their skills in communication, teambuilding, leadership and time management, the training is expected tobenefit staff both in their social interactions with fellow colleagues and thebusiness environment.Integral to staff retention is staff engagement. With this firm belief,we actively encouraged our staff to participate in our Corporate SocialResponsibility (CSR) activities, such as Aztech Green Movement Drive,charity events and pledge card donation. Other regular bonding activities,such as the weekly Aztech Exercise Day and the monthly Fruit Day, werealso held to ensure that our staff stay healthy and connected.Recognising that an open communication channel allows for greatermotivation, we also conducted employee satisfaction survey and dialoguesession with our Group Chairman and CEO during the year.In FY2009, apart from sending our staff for skills upgrading courses andtraining, we mapped out a series of soft skills training that helps to developtheir personality and upgrade their interpersonal skills. Designed to assist

20a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l C a l e n d a rFinancial CalendarFY2009Announcement of Results1st Quarter 23.04.20092nd Quarter 23.07.20093rd Quarter 21.10.2009Full year 08.02.2010Dividend Payment DatesInterim 28.08.2009Final 11.05.2010Annual Report and Accounts issued on 19.03.2009FY2008 Annual General Meeting 21.04.2009

C o r p o r a t e G o v e r n a n c ea z t e c h a n n u a l r e p o r t 2 0 0 921Corporate Governance ReportThe Board of Directors (“Board”) and Management of Aztech Group Ltd (“Aztech” and together with its group companies, the “Group”) strongly believethat a genuine commitment to good corporate governance is essential to preserve and enhance shareholder value.Aztech has adhered to the principles and guidelines of the Code of Corporate Governance 2005 (“Code”). Aztech’s corporate governance practices areset out in this report.Board MattersBoard’s Conduct of its AffairsThe Board oversees the business affairs of the Group. The Board takes responsibility for the Group’s overall strategic plans and key performanceobjectives, financial plans and annual budget, key investment proposals, financial performance review, internal control and accountability systems andcorporate governance practices.Board meetings are scheduled quarterly for the purpose of reviewing and approving the release of the Group’s financial results. Ad hoc Board meetingsare also held whenever the Board’s approval is required. In addition, the Board members regularly communicate via e-mail and telephone conference todiscuss matters arising including matters that are submitted to them for approval by way of circular resolutions.Dates of Board, Board Committee and Annual General meetings are scheduled in advance in consultation with Directors to assist Directors in planningtheir attendance. A Director who is unable to attend a Board meeting can still participate in the meeting via telephone conference, video conference orother means of similar communication as Aztech Articles of Association allow Board meetings to be conducted via such means. Decisions of the Boardand Board Committees may also be obtained via circular resolutions.A record of the Directors’ attendance at Board meetings and Board Committee meetings is set out below.Board ofDirectorsAuditCommitteeNominatingCommitteeRemunerationCommitteeNumber of Meetings Held 8 5 2 3Name of DirectorNumber of Meetings AttendedMichael Mun Hong Yew8 - 2 -(Executive Director)Patricia Ng Sok Cheng8 - - -(Executive Director)Colin Ng Teck Sim8 5 2 3(Independent Director)Philip Tan Tee Yong8 5 - 3(Independent Director)Khoo Ho Tong8 5 2 3(Independent Director)Martin Chia Heok Miin8 - - -(Executive Director)Jeremy Mun Weng Hung(Executive Director)8 - - -

22a z t e c h a n n u a l r e p o r t 2 0 0 9C o r p o r a t e G o v e r n a n c eCorporate Governance ReportBoard Composition and BalanceThe current Board comprises 7 Directors, of which 3 are Independent Directors. The Group has an effective board that can lead and control thebusinesses of the Group. With the diversification into new businesses in the last two years, the Board’s composition of majority of Executive Directors,who have intimate knowledge of the operations of the various businesses is beneficial. The Executive Directors work closely with Independent Directors,who bring independent judgment and perspective on issues to the Board.The Board as a whole has a well balanced composition. The Board has an appropriate mix of expertise and experience, and collectively possesses thenecessary core competencies for effective functioning and informed decision-making. These competencies include financial knowledge, accountingexpertise, business acumen, industry knowledge, legal expertise, familiarity with the regulatory requirements and knowledge of risk management. TheIndependent Directors communicate regularly to discuss matters and where necessary, have informal meetings and discussions without the presenceof the Executive Directors.The details and profile of each of the Directors is found on pages 8 and 9 and Appendix 1 of this report.Chairman and Chief Executive OfficerMr Michael Mun is both the Chairman and Chief Executive Officer (“CEO”). The Board is of the view that it is in the interest of the Group to adopt a singleleadership structure, whereby the CEO and Chairman of the Board is the same person, so as to ensure that the decision-making process of the Groupwould be robust and effective. The Board confirms this structure does not have concentrated power in the hands of one individual and that each Boardmember exercises independent decision-making. This is achieved by the Board as:1. The Independent Directors actively participate in Board meetings and freely challenge the assumptions and proposals submitted by theManagement;2. The Independent Directors participate in discussions via e-mail or telephone at any time to enquire on and understand pertinent issues affectingthe affairs and business of the Group;3. A Lead Independent Director has been appointed to co-ordinate the activities of the Independent Directors to provide a non-executive perspectiveto the Board.As Chairman, Mr Mun sets guidelines on and monitors the flow of information from Management to the Board to ensure that all material information isprovided comprehensively and promptly for the Board to make informed decisions.He also ensures that queries raised and clarifications sought by the Directors are addressed and where further research and information is required, hedirects the Company Secretary and Management to obtain the information and update the Board accordingly.As the Executive Chairman and CEO, Mr Mun, with the assistance of the Company Secretary, schedules Board meetings as and when required andprepares the agenda for Board meetings. He encourages constructive relations between the Board and Management and between the ExecutiveDirectors and Independent Directors. He plays an active role in the Group’s drive to achieve and maintain a high standard of corporate governance.Access to InformationPrior to each Board meeting, Aztech’s Management provides the Board with information relevant to matters on the agenda for the Board meeting.The Board has independent access to the Management and the Company Secretary at all times. The Company Secretary attends all Board and BoardCommittee meetings and is responsible for, among other things, ensuring that Board meetings are conducted properly and that all applicable rules andregulations are complied with. Where necessary, the Directors and Board Committees can seek independent professional advice.

C o r p o r a t e G o v e r n a n c ea z t e c h a n n u a l r e p o r t 2 0 0 923Corporate Governance ReportBoard and Management CommitteesThe following Committees assist the Board in executing its duties:• Audit Committee (“AC”)• Remuneration Committee (“RC”)• Nomination Committee (“NC”)• Investment CommitteeThe Chairman of each of the AC, RC and NC is an Independent Director. Each Board Committee is guided by its terms of reference. A record of eachDirector’s Board Committee memberships and attendance at Board Committee meetings during the financial year 2009 is set out on page 21.The Investment Committee comprises two Executive Directors (Mr Michael Mun and Mr Martin Chia), the Head of Finance (Mr Herman So) and VicePresident of Legal and Corporate Affairs / Company Secretary (Ms Pavani Nagarajah). All investment proposals are reviewed and submitted to the Boardby the Investment Committee. The Committee members, assisted by other Management staff, are responsible for advising the Board on the businessobjectives and risk profile of the investments proposed by the Management. Where required, external advice from industry experts is obtained by theGroup.Board Performance / MembershipThe NC has established a review process to assess the performance and effectiveness of the Board as a whole as well as to assess the contributionand performance of individual Directors.Each Director on the NC independently makes his assessment and the results are compiled by the Company Secretary and tabled at a meeting. The NCreviews the results and freely comments on areas that require improvement by the Board as a whole and each individual Director, where necessary.The criteria for the Board’s assessment are:• Adequacy of Board meetings• Independence component in the Board• Board’s team spirit• Board’s ability to make decision as a whole• Board’s ability to strategise and propose sound business direction as a whole• Board’s effectiveness in identifying and reviewing major concerns of the Group• Board’s effectiveness in identifying risks facing the Group and ensuring adequate control, monitoring and reporting mechanisms are in place• Board’s effectiveness in monitoring Group’s internal controls• Board’s effectiveness in strategising and problem solving• Board’s performance against the performance of specific targets over a five year period to determine if the Board has enhanced long termshareholder valueThe criteria for individual Directors’ assessment are:• Attendance of Board and Committee meetings• Overall participation in meetings• Providing expertise in either: (i) accounting (ii) business or (iii) legal fields• Leadership• Ability to strategise and propose sound business direction• Responsibility / Dedication / Commitment• General effectiveness as a Director

24a z t e c h a n n u a l r e p o r t 2 0 0 9C o r p o r a t e G o v e r n a n c eCorporate Governance ReportThe NC recommends nominations of new Directors, if any, and re-appointment of existing Directors. No new Director was appointed in financial year2009.All Directors, excluding Mr Michael Mun, submit themselves for re-nomination and re-election at regular intervals of at least once every three years.Pursuant to Article 107 of Aztech’s Articles of Association, one-third of the Board of Directors have to retire from office by rotation and be subject tore-election at the Annual General Meeting.All new appointments and re-nomination of Directors are subject to the recommendation of the NC. Some of the criteria considered by the NC whileevaluating Directors’ appointments are:(a)(b)(c)(d)(e)Independence of mindCapability and how it meets the current needs of Aztech and simultaneously complements the skill set of the other Board membersExperience and track record in high-performing companiesAbility to commit time and effort toward discharging his responsibilities as a DirectorReputation and integrityAudit CommitteeUnder the Code, the AC must comprise at least three Directors, all of whom must be Non-Executive Directors and the majority of whom, includingthe Chairman, must be Independent Directors. At least two members of the Audit Committee must have accounting or related financial managementexpertise or experience. The AC fully complies with the Code. The members of the AC are Mr Philip Tan (Chairman), Mr Khoo Ho Tong and Mr ColinNg.The AC has the authority to investigate any matter within its terms of reference, and has the full cooperation of and access to Management. It has directaccess to the internal and external auditors, and full discretion to invite the Group’s officers to attend its meetings.The AC meets on a quarterly basis to review the quarterly financial statement. The AC evaluates the adequacy of internal control systems of the Group. ACalso reviews the internal audit plans and determines the scope of audit examination. The AC reviews the scope and results of audit work carried out byexternal auditors, the cost effectiveness of the audit, and the independence and objectivity of the external auditors. The AC recommends to the Board there-appointment of external auditors, and approves the remuneration and terms of engagement of the external auditors. The AC also reviews the extentand costs of non-audit services provided by the external auditors, seeking to balance the maintenance of objectivity and independence of the externalauditors. The AC is satisfied with their independence. The AC meets the external auditors independently at least once a year.The AC monitors any proposed changes in accounting polices and actively discusses accounting implications of major transactions including significantfinancial reporting issues. With the diversification of the Group to new business sectors, the AC is appraised by Management from time to time of anychange in the Group’s general accounting polices for the new businesses undertaken by the Group.Remuneration MattersThe members of the RC are Mr Khoo Ho Tong (Chairman), Mr Colin Ng and Mr Philip Tan. All members of the RC are Independent and Non-ExecutiveDirectors. As stated in the Group’s Code of Corporate Governance, the objective of the RC is to help the Board ensure that the remuneration paid is:(a)(b)appropriate for the purpose of attracting, retaining and motivating the Directors and executives to run the Group successfully; andin the case of Independent Directors, not such as to compromise their independence.

C o r p o r a t e G o v e r n a n c ea z t e c h a n n u a l r e p o r t 2 0 0 925Corporate Governance ReportThe RC reviews and approves remuneration matters of all Executive Directors. The RC also reviews and approves all appointments and promotionsof Key Executives. The RC ensures that the Group’s compensation policy is linked to the performance of the business units as well as an individual’sachievements to ensure that there is individual accountability.The RC also administers the Group’s Share Option Scheme that was implemented on March 10, 2000 and expired on March 9, 2010. The RC continuesto monitor the allotment of shares when options are exercised by the staff. No new options were granted in the financial year 2009.Remuneration of Executive DirectorsThe information relating to the remunerations of the Executive Directors is as follows:Name of Executive DirectorSalary and Directors’ Fees%Bonus%Profit Sharing%*Others%Total%Between $1,250,000 and $1,500,000Michael Mun Hong Yew 51 21 21 7 100Between $250,000 and $500,000Patricia Ng Sok ChengMartin Chia Heok MiinJeremy Mun Weng Hung8262636211919101188100100100* The contribution to the Central Provident Fund, allowances and car cost (if any) is included in the column referred to as “Others” above.Gain from Exercise of OptionsDuring the year, the following Directors exercised share options and the gain from the exercise of options is as follows:Name of Executive DirectorGain as at the date the shares were listedMichael Mun Hong Yew $102,000Martin Chia Heok Miin $72,000Patricia Ng Sok Cheng $68,000Directors’ FeesThe Directors’ Fees earned by each of the Directors for the financial year 2009 are as follows:Name of DirectorDirectors’ FeesMr Philip Tan Tee Yong, Chairman of AC and Member of RC$85,000Lead Independent DirectorMr Colin Ng, Chairman of NC and Member of AC & RC $60,000Mr Khoo Ho Tong, Chairman of RC and Member of AC & NC $60,000Mr Michael Mun, CEO and Chairman, Member of NC $50,000Mr Martin Chia, Executive Director $30,000Ms Patricia Ng, Executive Director $30,000Mr Jeremy Mun, Executive Director $30,000The Non-Executive Directors are only paid Directors’ Fees. The Director’ Fees paid to the Executive Directors is included in the remuneration informationof the respective Directors stated above.

26a z t e c h a n n u a l r e p o r t 2 0 0 9C o r p o r a t e G o v e r n a n c eCorporate Governance ReportKey ExecutivesThe remunerations of the top Key Executives of the Group (who are not Directors) fall within the following bands:Top 6 Key ExecutivesSalary%Bonus%Profit Sharing%*Others%Total%Between $250,000 and $500,000Michael Lee Thiam Seong 71 15 4 10 100Below $250,000Low Wei Chong 74 9 2 15 100Jason Saw Chwee Meng 69 14 5 12 100Herman So Kam Hung 78 16 5 1 100Pavani Nagarajah 71 19 5 5 100Sylvester Saw Cheng San 80 13 2 5 100* The contribution to the Central Provident Fund, allowances and car cost (if any) is included in the column referred to as “Others” above.For the Financial Year ended December 31, 2009, except for Mr Michael Mun and Mr Jeremy Mun (whose remunerations are disclosed above), noemployee of the Group whose remuneration exceeds $150,000 was an immediate family member of a Director or CEO. Immediate family includesspouse, child, adopted child, stepchild, brother, sister or parent. Mr Jeremy Mun is the son of Mr Michael Mun.Nominating CommitteeThe role of the NC includes the responsibility for re-nominating of Directors who retire by rotation. The members of the NC are Mr Colin Ng (Chairman),Mr Khoo Ho Tong and Mr Michael Mun.The NC conducts an annual review of Directors’ independence, and is of the view that Mr Tan, Mr Ng and Mr Khoo are independent. The Board notedthat Messrs Colin Ng & Partners LLP, a law firm of which Mr Ng is the managing partner, provides legal services to the Group. The services are providedby lawyers other than Mr Ng. The NC is satisfied with the independence of Mr Ng.The NC has reviewed and is satisfied that Mr Ng and Mr Khoo, who serve on the boards of other listed companies, have been able to devote adequatetime and attention to the affairs of the Group to fulfill their duties as Directors.AccountabilityThe Board presents a balanced and understandable assessment of the Group’s performance and position to the public via the release of its quarterly andfull year financial results. The Board reviews and approves the results before its release. With regard to the SGX-ST’s introduction of the requirementfor Directors to issue a Negative Assurance Statement to accompany its quarterly financial results announcement, there is an internal process for theExecutive Directors to represent to the Board on the integrity of the Group’s financial statement before the Negative Assurance Statement is given by theBoard. The process is carried out for all quarterly and full year results.

C o r p o r a t e G o v e r n a n c ea z t e c h a n n u a l r e p o r t 2 0 0 927Corporate Governance ReportInternal AuditThe Internal Auditor, who reports directly to the Chairman of the AC, continuously monitors the compliance of the Group’s internal controls, policies andprocedures. The Internal Auditor also monitors the effectiveness of the internal control systems and procedures and submits the findings to the AC. TheInternal Auditor plans the internal audit schedules and submits the plan to the AC Chairman for approval prior to the commencement of the internal audit.The AC Chairman reviews the activities of the Internal Auditor on a regular basis, including advising on any improvement required on internal control orother internal audit matters.Whistle Blowing PolicyThe Group has in place a whistle blowing policy that gives staff access to the Chairman, Internal Auditor and Lead Independent Director to report in goodfaith and in confidence, concerns about possible improprieties. The policy defines the process and ensures independent investigation of such matters.The staff are assured that they are protected from reprisals.Interested Person TransactionsAll interested person transactions are submitted for review by the AC on a quarterly basis. The transactions entered into with interested persons duringthe financial year which fall under Rule 907 of the Listing Manual (“LM”) of the SGX-ST are:Name of Interested PersonAVS Solutions Sdn Bhd*- Rental Income and services fee- Purchase of goodsAggregate value of all interested persontransactions during the financial yearunder review (excluding transactionsless than S$100,000 and transactionsconducted under shareholders’ mandatepursuant to Rule 920 of the LM)S$53,600S$ 2,354Aggregate value of all interestedperson transactions conducted undershareholders’ mandate pursuant to Rule920 of the LM (excluding transactionsless than S$100,000)AVS Technologies Pte Ltd*- Rental Income S$17,254 ---AVS Computer Services Pte Ltd*- Sales of goods S$760 -Messrs Colin Ng & Partners LLP**- Legal Services S$146,402 -Note* Transactions above with companies in which Mr Michael Mun has an equity interest.** Transactions with law firm Colin Ng & Partners LLP in which Mr Colin Ng is the Managing Partner

28a z t e c h a n n u a l r e p o r t 2 0 0 9C o r p o r a t e G o v e r n a n c eCorporate Governance ReportSecurities DealingAztech has adopted policies as prescribed in the LM, which prohibit dealings in Aztech’s securities by Directors and staff for a period of two weeks beforethe announcement of its quarterly or half-yearly financial results. For year-end results, the period of prohibition is one month.In line with best practices, Aztech Legal Department issues a quarterly memo to its Directors and officers informing them that they must not deal inAztech’s securities before the release of results.The Board and Management believe that Aztech has complied with the LM.No Material ContractSince the end of financial year 2008, the Group did not enter into any material contracts in which the CEO, Directors or Controlling Shareholders hadany interest and no such material contracts subsist at the end of financial year 2009.Communication with ShareholdersThe Group has adopted quarterly results reporting since 2001.In line with the continuous disclosure obligations of the Group pursuant to the LM and the Singapore Companies Act, the Group’s policy is that allshareholders should be informed promptly and in a comprehensive manner of all material developments that impact the Group. The information iscommunicated by way of announcements via SGXNET and press releases.All material information on the performance and development of the Group is disclosed in a timely manner. The Group does not practice selectivedisclosure of material information. All materials on the quarterly, half-yearly and full year financial results are available on the Group’s website –www.aztech-group.com.The Articles of Association allow a shareholder to appoint up to two proxies to attend the AGM and vote in place of the shareholder.At general meetings, all the resolutions are single item resolutions.

C o r p o r a t e G o v e r n a n c ea z t e c h a n n u a l r e p o r t 2 0 0 929Corporate Governance ReportAppendix 1Particulars of DirectorsName Of DirectorAgeMichael Mun Hong Yew60Directorship Date first appointed: 6 August 1986Directorships in Listed Company Aztech Group LtdName Of DirectorMartin Chia Heok MiinAge49Directorship Date first appointed: 8 June 2006Date last re-elected: 10 April 2007Directorships in Listed Company Aztech Group LtdName Of DirectorPatricia Ng Sok ChengAge50Directorship Date first appointed: 6 April 1993Date last re-elected: 11 April 2008Directorships in Listed Company Aztech Group LtdName Of DirectorJeremy Mun Weng HungAge34Directorship Date first appointed: 8 June 2006Date last re-elected: 21 April 2009Directorships in Listed Company Aztech Group LtdName Of DirectorPhilip Tan Tee YongAge64Directorship Date first appointed: 26 June 1993Date last re-elected: 11 April 2008Directorships in Listed Company Aztech Group LtdName Of DirectorColin Ng Teck SimAge54Directorship Date first appointed: 12 October 1993Date last re-elected: 21 April 2009Directorships in Listed Company Aztech Group LtdTSH Corporation Limited (present)CEI Contract Manufacturing Limited (present)Media Asia Entertainment Group Limited (past – until 12 June 2007)Independent Director,Chairman of ACMember of RC & NCIndependent Director,Member of AC & RCIndependent Director,Non-Executive Director, Chairmanof the Board, Chairman of ACMember of RC

30a z t e c h a n n u a l r e p o r t 2 0 0 9C o r p o r a t e G o v e r n a n c eCorporate Governance ReportName Of DirectorKhoo Ho TongAge69Directorship Date first appointed: 12 November 2002Date last re-elected: 10 April 2007Directorships in Listed Company Aztech Group LtdNam Lee Pressed Metal Industries Ltd (present)Asia Travel.com Holdings Ltd (present)Tastyfood Holdings Ltd (Past – until 24 April 2008)J K Technology Group Ltd (Past – until 6 August 2008)Kingsmen Creatives Ltd (Past – 28 April 2008)Eng Kong Holdings Ltd (Past – until March 2007)Independent Director,Chairman of ACMember of RC & NCIndependent Director,Chairman of ACMember of RCIndependent Director,Chairman of ACMember of RC & NCIndependent Director,Member of AC, RC & NCIndependent Director,Chairman of RCMember of AC & NCIndependent Director,Chairman of NCMember of AC & RC

C o r p o r a t e G o v e r n a n c eFinancial StatementsReport of the DirectorS 32Statement of directors 40Independent auditors’ report 41Statements of financial position 43consolidated Statement of comprehensive income 45statements of changes in equity 46consolidated statement of cash flows 48notes to financial statements 50analysis of shareholdings 103analysis of warrantholdings 104notice of annual general meeting 106proxy Form

32a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sREPORT OF THE DIRECTORSThe Directors present their report together with the audited consolidated financial statements of the Group and statement of financial position andstatement of changes in equity of the Company for the financial year ended December 31, 2009.1 DIRECTORSThe Directors of the Company in office at the date of this report are:Michael Mun Hong YewMartin Chia Heok MiinPatricia Ng Sok ChengPhilip Tan Tee YongColin Ng Teck SimKhoo Ho TongJeremy Mun Weng Hung2 AUDIT COMMITTEEThe Board has adopted the principles as described in the Code of Corporate Governance formulated by the Singapore Exchange Securities TradingLimited (“SGX-ST”) with regards to the Audit Committee. The members of the Audit Committee of the Company at the date of this report are asfollows:Philip Tan Tee YongColin Ng Teck SimKhoo Ho Tong(Chairman and Independent Director)(Non-Executive Independent Director)(Non-Executive Independent Director)The Audit Committee met five times since the last Annual General Meeting (“AGM”) and reviewed the following, where relevant, with the ExecutiveDirectors, the External Auditors and Internal Auditor of the Company:a) the audit plans and results of the External Auditors’ and Internal Auditor’s examination and evaluation of the Group’s systems of internalaccounting controls;b) the Group’s financial and operating results and accounting policies;c) the financial statements of the Company and the consolidated financial statements of the Group before their submission to the Directorsof the Company and the External Auditors’ report on those financial statements;d) the quarterly, half-yearly and annual announcements as well as the related press releases on the results and financial position of theCompany and the Group;e) the co-operation and assistance given by the management to the Group’s External Auditors and Internal Auditor;f) interested person transactions; andg) the re-appointment of the External Auditors of the Company.The Audit Committee has full access to and co-operation of the Management and has been given the resources required for it to discharge its functionproperly. It also has full discretion to invite any Director and Executive Officer to attend its meetings. The External Auditors and Internal Auditor haveunrestricted access to the Audit Committee.The Audit Committee has recommended to the Directors the nomination of Deloitte & Touche LLP for re-appointment as External Auditors of theCompany at the forthcoming AGM of the Company.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 933REPORT OF THE DIRECTORS3 ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE BENEFITSBY MEANS OF THE ACQUISITION OF SHARES AND DEBENTURESNeither at the end of the financial year nor at any time during the financial year did there subsist any arrangement whose object is to enable theDirectors of the Company to acquire benefits by means of the acquisition of shares or debentures in the Company or any other body corporateexcept for the Aztech Group Employee Share Option Scheme 2000 (“ESOS 2000”) as detailed in paragraphs 4 and 6 of the Report of theDirectors.4 DIRECTORS’ INTERESTS IN SHARES AND DEBENTURESThe Directors of the Company holding office at the end of the financial year had no interests in the share capital and debentures of the Companyand related corporations as recorded in the register of Directors’ shareholdings kept by the Company under Section 164 of the SingaporeCompanies Act except as follows:Names of Directors and companiesin which interests are heldShareholdings registeredin the name of DirectorAt beginningof yearAt endof yearShareholdings in which Directors aredeemed to have an interestAt beginningAt endof yearof yearThe Company- Aztech Group Ltd(Ordinary shares)Michael Mun Hong Yew 93,681,386 115,105,663 3,800,000 4,836,000Patricia Ng Sok Cheng 8,788,474 16,906,168 4,500,000 1,200,000Jeremy Mun Weng Hung 20,000 1,044,000 750,000 -Martin Chia Heok Miin 2,188,000 3,826,000 20,000 22,000Khoo Ho Tong 671,000 806,000 - -Philip Tan Tee Yong 500,000 600,000 - -Colin Ng Teck Sim 610,000 768,000 100,000 120,000The Company - Aztech Group LtdESOS 2000Options to subscribe for ordinary sharesAt beginningAt endof yearof yearMichael Mun Hong Yew 2,000,000 -Patricia Ng Sok Cheng 2,300,000 547,916Martin Chia Heok Miin 2,500,000 1,643,749

34a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sREPORT OF THE DIRECTORS4 DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES (cont’d)Names of Directors and companiesin which interests are heldWarrants to subscribe fornew ordinary sharesAt beginningof yearAt endof yearDeemed interest in warrants to subscribefor new ordinary sharesAt beginningof yearAt endof yearThe Company- Aztech Group LtdWarrants 2010Michael Mun Hong Yew 23,154,846 25,373,851 250,000 273,958Patricia Ng Sok Cheng 3,784,618 4,147,310 - -Jeremy Mun Weng Hung - 191,770 175,000 -Martin Chia Heok Miin 397,000 435,045 2,500 2,739Khoo Ho Tong 125,000 136,979 - -Philip Tan Tee Yong 125,000 136,979 - -Colin Ng Teck Sim 125,000 136,979 - -Warrants 2012Michael Mun Hong Yew - 19,184,277 - 806,000Patricia Ng Sok Cheng - 2,817,694 - 200,000Jeremy Mun Weng Hung - 174,000 - -Martin Chia Heok Miin - 638,000 - 2,000Khoo Ho Tong - 135,000 - -Philip Tan Tee Yong - 100,000 - -Colin Ng Teck Sim - 128,000 - 20,000By virtue of Section 7 of the Singapore Companies Act, Michael Mun Hong Yew is deemed to have an interest in the Company and in all thesubsidiaries of the Company.The Directors’ interests as at January 21, 2010 were the same as those at December 31, 2009.5 DIRECTORS’ RECEIPT AND ENTITLEMENT TO CONTRACTUAL BENEFITSSince the beginning of the financial year, no Director has received or become entitled to receive a benefit which is required to be disclosed underSection 201(8) of the Singapore Companies Act, by reason of a contract made by the Company or a related corporation with the Director orwith a firm of which he is a member, or with a company in which he has a substantial financial interest except for salaries, bonuses and otherbenefits as disclosed in the financial statements and the Profit Sharing Scheme (“Scheme”) as described below and as disclosed in the financialstatements.Certain Directors received remuneration from related corporations in their capacity as Directors and/or executives of those related corporations.There were certain transactions (as shown in Note 6 of the financial statements) with corporations in which certain Directors have an interest.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 935REPORT OF THE DIRECTORS5 DIRECTORS’ RECEIPT AND ENTITLEMENT TO CONTRACTUAL BENEFITS (cont’d)Directors’ Profit Sharing SchemeThe Company has entered into the Scheme, which was recommended by the Remuneration Committee and approved by the Board of Directors,with the following Directors of the Company:Michael Mun Hong YewPatricia Ng Sok ChengMartin Chia Heok MiinJeremy Mun Weng HungFor Michael Mun Hong YewIn accordance with the Scheme, Michael Mun Hong Yew is entitled to profit share based on the amount of the audited consolidated profit after tax(“PAT”), as computed in the following manner:(i)(ii)(iii)When PAT is equal to or exceeds $5 million (“Minimum Profit”) but less than $10 million, the amount shall be equal to 1.2% of the PAT;When PAT is equal to or exceeds $10 million but less than $15 million, the amount shall be equal to 1.6% of the PAT; andWhen the PAT is equal to or exceeds $15 million, the amount shall be 2.0% of the PAT.For Patricia Ng Sok Cheng, Martin Chia Heok Miin and Jeremy Mun Weng HungIn accordance with the Scheme, Patricia Ng Sok Cheng, Martin Chia Heok Miin and Jeremy Mun Weng Hung are entitled to share in the ProfitSharing Pool (“Pool”), based on the amount of PAT, as computed in the following manner:(i)(ii)(iii)When PAT is equal to or exceeds Minimum Profit, but less than $10 million, the Pool shall be equal to 1.8% of the PAT;When PAT is equal to or exceeds $10 million but less than $15 million, the Pool shall be equal to 2.4% of the PAT; andWhen the PAT is equal to or exceeds $15 million, the Pool shall be 3.0% of the PAT.Under the Scheme, the Remuneration Committee shall review and recommend their respective share of the Pool to be allocated to theabovementioned Directors. The actual amount payable to them shall be deliberated and decided by the Board of Directors.As at the end of the financial year, an accrual of $450,000 (2008 : $450,000) has been made pursuant to the Scheme.

36a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sREPORT OF THE DIRECTORS6 SHARE OPTIONSAZTECH GROUP EMPLOYEE SHARE OPTION SCHEME 2000 (“ESOS 2000”)(a) Names of the Members of the Committee Administering ESOS 2000ESOS 2000 was approved and adopted at the Company’s Extraordinary General Meeting held on March 10, 2000 and will continuein operation for a maximum period of 10 years, commencing on March 10, 2000. ESOS 2000 is administered by the RemunerationCommittee comprising the following members:Khoo Ho Tong (Chairman)Philip Tan Tee YongColin Ng Teck SimParticipants who are members of the Committee were not involved in the deliberations in respect of options granted to that participant.(b)Outstanding OptionsThe number of Shares available under the Scheme shall not exceed 15% of the issued share capital of the Company. The number ofoutstanding share options under the scheme is as follows:Date optionsgrantedExercise periodOffer priceper option (1)(5)Number ofoptionsgrantedRights shareissueadjustment (5)Number ofoptionsexercisedNumberNumber of of optionsoptions outstanding aslapsed/ at Decembercancelled 31, 2009May 18, 2004June 12, 2004June 12, 2004December 12,2006July 27, 2007August 28, 2008August 28, 2008May 19, 2005 toMay 18,2009June 13, 2005 toJune 12, 2009June 13, 2005 toJune 12, 2009December 13, 2007to December 12, 2011July 28, 2008 toJuly 27, 2012August 29, 2009 toAugust 28, 2013August 29, 2009 toAugust 28, 2013$0.149 (“A”) 3,300,000 - 3,300,000 - -$0.119 (“B”)$0.135 (“A) 1,000,000 - 1,000,000 - -$0.112 (“B”)$0.135 (“A”) 9,365,000 - 6,875,000 2,490,000 -$0.108 (“B”)$0.232 (“A”) 3,350,000 153,330 1,200,000 550,000 1,753,330$0.170 (“B”)$0.561 (“A”) 1,950,000 122,654 - 670,000 1,402,654$0.410 (“B”)$0.185 (4) 2,000,000 143,749 500,000 - 1,643,749$0.160 (“A”) 6,750,000 584,576 400,000 250,000 6,684,576$0.128 (“B”)27,715,000 1,004,309 13,275,000 3,960,000 11,484,309Holders of the above share options have no right to participate in any share issue of any other company and no employee or employee ofrelated corporations has received 5% or more of the total options available under ESOS 2000, except as detailed below.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 937REPORT OF THE DIRECTORS6 SHARE OPTIONS (cont’d)(b)Outstanding Options (cont’d)There are no options granted to any of the Company’s controlling shareholders or their associates (as defined in the Singapore ExchangeSecurities Trading Listing Manual), except as detailed below.Note:(1) “A” - Option Price that is applicable if option exercised after the 1 st anniversary of the date of the acceptance of the offer but beforethe 2 nd anniversary of the date of the acceptance of the offer. Option Price A is finalised based on the average of the last dealt pricesper share of the Company on the SGX-ST for the period of five (5) consecutive market days prior to the date the option is offered.“B” - Option Price that is applicable if option exercised after the 2 nd anniversary of the date of the acceptance of the offer but beforethe expiry of sixty (60) months from the date of the acceptance of the offer.(2) All options granted under ESOS 2000 (Price “B”) were granted at a discount of 20%.(3) Each option entitles participants to subscribe for one ordinary share in the Company.(4) The grant price of options to Executive Director is the higher of:(i)(ii)the average of the last dealt prices per share of the Company on the SGX-ST for the period of five (5) consecutive marketdays immediately prior to the date of offer orthe Group’s net tangible asset per share as determined from the Group’s latest audited consolidated financial statement.(5) On November 24, 2009, due to the Rights cum Warrants issue exercise, the number and price of the existing share options wereadjusted accordingly, and an additional 1,004,309 share options were granted.(c)Participants who are Directors/ controlling shareholder/ associate of controlling shareholder/ executivesName of participantDirectors of the CompanyOptionsgrantedduring thefinancialyear underreviewRightsshareissueadjustmentAggregateoptionsgranted sincecommencementof scheme toend ofDecember 31,2009Aggregateoptionsexercised sincecommencementof scheme to endof December 31,2009Aggregateoptionslapsed sincecommencementof scheme to endof December 31,2009Aggregateoptionsoutstandingas at end ofDecember 31,2009Michael Mun Hong Yew (1)(3)(4) - - 3,000,000 3,000,000 - -Martin Chia Heok Miin (3) - 143,749 5,242,500 2,898,000 844,500 1,643,749Patricia Ng Sok Cheng (3) - 47,916 5,370,000 4,120,000 750,000 547,916Jeremy Mun Weng Hung (2)(4) - - 300,000 300,000 - -Khoo Ho Tong - - 500,000 500,000 - -Colin Ng Teck Sim - - 500,000 500,000 - -Philip Tan Tee Yong - - 500,000 500,000 - -- 191,665 15,412,500 11,818,000 1,594,500 2,191,665

38a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sREPORT OF THE DIRECTORS6 SHARE OPTIONS (cont’d)(c)Participants who are Directors/ controlling shareholder/ associate of controlling shareholder/ executives (cont’d)Note:(1) Michael Mun Hong Yew is also a controlling shareholder of the Company.(2) Jeremy Mun Weng Hung is the son of Michael Mun Hong Yew.(3) Participants received 5.0% or more of total available options.(4) Options granted to Michael Mun Hong Yew and Jeremy Mun Weng Hung were approved by resolution passed at the EGM of theCompany dated April 12, 2004.(d)Issue of shares under optionsIn 2009, the Company issued a total of 7,220,000 ordinary shares at the following exercise price, pursuant to the exercise of options underthe ESOS 2000 to take up unissued shares of the Company:Number of ordinary sharesExercise price2,000,000 $0.1192,120,000 $0.1081,000,000 $0.1121,200,000 $0.186400,000 $0.175500,000 $0.203Except for the above, no other options to take up unissued shares of the Company and subsidiaries were granted and no other shares wereissued by virtue of the exercise of options to take up unissued shares of the Company or its subsidiaries. As at the end of the financialyear, except for the above, there were no unissued shares of any other subsidiaries under option.7 WARRANTSOn July 17, 2007, the Company allotted 104,390,250 warrants at an issue price of $0.02 for each warrant on the basis of one warrant for everyfour existing shares. On November 24, 2009, due to the Rights cum Warrants issue exercise, the number and price of the existing warrants wereadjusted accordingly, and an additional 9,948,476 warrants were allotted. Each warrant entitles the warrant holder to subscribe for one newordinary share of the Company at an adjusted exercise price of $0.47 (2008 : $0.51) per share. The warrants have an exercise period of 3 yearsfrom July 17, 2007 to July 16, 2010. As at December 31, 2009, the outstanding number of warrants is 113,792,726.On November 24, 2009, the Company allotted 81,272,000 rights shares with 81,272,000 warrants at an issue price of $0.125 for each rightsshare on the basis of one rights share with one warrant for every five existing shares. Each warrant entitles the warrant holder to subscribe forone new ordinary share of the Company at an exercise price of $0.20 per share. The warrants have an exercise period of 3 years from November24, 2009 to November 23, 2012. During the year, 8,000 new ordinary shares were issued from the conversion of warrants. As at December 31,2009, the outstanding number of warrants is 81,264,000.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 939REPORT OF THE DIRECTORS8 AUDITORSThe auditors, Deloitte & Touche LLP, have expressed their willingness to accept re-appointment.ON BEHALF OF THE DIRECTORSMichael Mun Hong YewMartin Chia Heok MiinMarch 15, 2010

40a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sSTATEMENT OF DIRECTORSIn the opinion of the directors, the consolidated financial statements of the Group and the statement of financial position and statement of changes in equityof the Company as set out on pages 43 to 102 are drawn up so as to give a true and fair view of the state of affairs of the Group and of the Company asat December 31, 2009, and of the results, changes in equity and cash flows of the Group and changes in equity of the Company for the financial year thenended and at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts when they fall due.ON BEHALF OF THE DIRECTORSMichael Mun Hong YewMartin Chia Heok MiinMarch 15, 2010

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 941INDEPENDENT AUDITORS’ REPORT TO THEMEMBERS OF AZTECH GROUP LTDWe have audited the accompanying financial statements of Aztech Group Ltd (the “Company”) (formerly Aztech Systems Ltd) and its subsidiaries(the “Group”) which comprise the statements of financial position of the Group and the Company as at December 31, 2009, and the statement ofcomprehensive income, statement of changes in equity and statement of cash flows of the Group and the statement of changes in equity of the Companyfor the year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on pages 43 to 102.Management’s Responsibility for the Financial StatementsManagement is responsible for the preparation and fair presentation of these financial statements in accordance with the provisions of the SingaporeCompanies Act, Cap. 50 (the “Act”) and Singapore Financial Reporting Standards. This responsibility includes: devising and maintaining a system ofinternal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition;and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair profit and loss account andbalance sheets and to maintain accountability of assets; selecting and applying appropriate accounting policies; and making accounting estimates thatare reasonable in the circumstances.Auditors’ ResponsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with SingaporeStandards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurancewhether the financial statements are free from material misstatement.An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The proceduresselected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether dueto fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentationof the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing anopinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

42a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sINDEPENDENT AUDITORS’ REPORT TO THEMEMBERS OF AZTECH GROUP LTDOpinionIn our opinion,(a)(b)the consolidated financial statements of the Group and the statement of financial position and statement of changes in equity of the Company areproperly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to give a true and fair view ofthe state of affairs of the Group and of the Company as at December 31, 2009 and of the results, changes in equity and cash flows of the Groupand changes in equity of the Company for the year ended on that date; andthe accounting and other records required by the Act to be kept by the Company and by those subsidiaries incorporated in Singapore of whichwe are the auditors have been properly kept in accordance with the provisions of the Act.Deloitte & Touche LLPPublic Accountants andCertified Public AccountantsSingaporeMarch 15, 2010

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 943STATEMENTS OF FINANCIAL POSITIONDecember 31, 2009GROUPCOMPANYNote 2009 2008 2009 2008$’000 $’000 $’000 $’000ASSETSCurrent assetsCash and bank balances 7 36,112 37,649 12,319 16,672Trade receivables 8 27,277 36,132 101 5,744Other receivables and prepayments 9 6,242 2,123 42,538 26,132Tax recoverable 1,066 - 579 -Derivative financial instruments 10 - 205 - -Inventories 11 26,724 33,713 - -Total current assets 97,421 109,822 55,537 48,548Non-current assetsOther receivables and prepayments 9 2,691 8,822 - -Investment in subsidiaries 12 - - 83,536 58,129Property, plant and equipment 13 77,747 62,193 269 743Investment properties 14 12,323 12,656 - -Available-for-sale financial assets 15 555 556 516 516Deferred tax assets 16 191 1,165 16 572Intangible asset 17 4,214 4,984 - 5,269Total non-current assets 97,721 90,376 84,337 65,229Total assets 195,142 200,198 139,874 113,777

44a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sSTATEMENTS OF FINANCIAL POSITIONDecember 31, 2009GROUPCOMPANYNote 2009 2008 2009 2008$’000 $’000 $’000 $’000LIABILITIES AND EQUITYCurrent liabilitiesBorrowings 18 28,853 39,356 4,205 7,575Trade payables 19 23,330 24,512 175 130Other payables and provisions 20 8,573 8,690 15,810 11,886Derivative financial instruments 10 34 85 - -Income tax payable - 2,379 - 1,718Finance leases 21 784 1,938 - -Total current liabilities 61,574 76,960 20,190 21,309Non-current liabilitiesBorrowings 18 19,366 27,128 - -Deferred tax liabilities 16 1,474 - - -Finance leases 21 397 1,212 - -Total non-current liabilities 21,237 28,340 - -Capital and reservesShare capital 22 121,286 110,082 121,286 110,082Treasury shares 23 (5,636) (5,636) (5,636) (5,636)Warrant reserve 1,769 1,769 1,769 1,769Foreign currency translation reserve (3,967) (2,705) - -Employee share-based compensation reserve 24 850 769 850 769Investment revaluation reserve 200 200 200 200(Accumulated losses) Retained earnings (2,171) (9,581) 1,215 (14,716)Total equity 112,331 94,898 119,684 92,468Total liabilities and equity 195,142 200,198 139,874 113,777See accompanying notes to financial statements.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 945CONSOLIDATED STATEMENT OFCOMPREHENSIVE INCOMEYear ended December 31, 2009GROUPNote 2009 2008$’000 $’000Revenue 25 280,267 276,453Cost of sales (242,840) (235,970)Gross profit 37,427 40,483Other operating income 26 5,789 3,533Selling and distribution costs (3,332) (5,363)Administrative expenses (19,800) (23,776)Finance costs 27 (2,046) (2,259)Profit before income tax 18,038 12,618Income tax 28 (2,620) (385)Net profit for the year 29 15,418 12,233Other comprehensive incomeExchange differences on translation offoreign operations, net of tax (1,262) 777Total comprehensive income for the year 14,156 13,010Profit attributable to:Owners of the Company 15,418 12,233Total comprehensive income attributable to:Owners of the Company 14,156 13,010Earnings per share (cents)- Basic 30 3.75 3.01- Diluted 30 3.70 2.94See accompanying notes to financial statements.

46a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sSTATEMENTS OF CHANGES IN EQUITYYear ended December 31, 2009NoteSharecapitalTreasurysharesForeigncurrencyWarrant translationreserve (1) reserveEmployeeshare basedcompensationreserveInvestmentrevaluation Accumulatedreserve (2) losses Total$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000GROUPBalance at January 1, 2008 109,958 (3,647) 1,769 (3,482) 547 200 (15,699) 89,646Total comprehensive income for the year - - - 777 - - 12,233 13,010Issue of shares 22 124 - - - - - - 124Repurchase of shares 23 - (1,989) - - - - - (1,989)Recognition of share-based payment 24 - - - - 222 - - 222Dividend paid 31 - - - - - - (6,115) (6,115)Balance at December 31, 2008 110,082 (5,636) 1,769 (2,705) 769 200 (9,581) 94,898Total comprehensive income for the year - - - (1,262) - - 15,418 14,156Issue of shares 22 11,204 - - - (384) - - 10,820Recognition of share-based payment 24 - - - - 465 - - 465Dividend paid 31 - - - - - - (8,008) (8,008)Balance at December 31, 2009 121,286 (5,636) 1,769 (3,967) 850 200 (2,171) 112,331(1) The warrant reserve represents net proceeds in the company rights issue of warrants. As and when the warrants are exercised, the net proceeds relating to the warrants exercised will be transferred to the share capitalreserve.(2) The investment revaluation reserve arises from the revaluation of available for sale financial assets. Where a revalued financial asset is sold, the portion of the reserve that relates to that financial asset, and is effectivelyrealised, is recognised in profit or loss. Where a revalued asset is impaired, the portion of the reserve that relates to that financial asset is recognised in profit or loss.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 947STATEMENTS OF CHANGES IN EQUITYYear ended December 31, 2009NoteSharecapitalTreasurysharesEmployeeshare basedWarrant compensationreserve (1) reserveInvestmentrevaluationreserve (2)(Accumulatedlosses)/Retainedearnings Total$’000 $’000 $’000 $’000 $’000 $’000 $’000COMPANYBalance at January 1, 2008 109,958 (3,647) 1,769 547 200 (17,593) 91,234Total comprehensive income for the year - - - - - 8,992 8,992Issue of shares 22 124 - - - - - 124Repurchase of shares 23 - (1,989) - - - - (1,989)Recognition of share-based payment 24 - - - 222 - - 222Dividend paid 31 - - - - - (6,115) (6,115)Balance at December 31, 2008 110,082 (5,636) 1,769 769 200 (14,716) 92,468Total comprehensive income for the year - - - - - 23,939 23,939Issue of shares 22 11,204 - - (384) - - 10,820Recognition of share-based payment 24 - - - 465 - - 465Dividend paid 31 - - - - - (8,008) (8,008)Balance at December 31, 2009 121,286 (5,636) 1,769 850 200 1,215 119,684See accompanying notes to financial statements.

48a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sCONSOLIDATED STATEMENT OF CASH FLOWSYear ended December 31, 2009GROUP2009 2008$’000 $’000Operating activitiesProfit before income tax 18,038 12,618Adjustments for:Share based payment 465 222Allowance for doubtful trade receivables 27 -Allowance for inventory obsolescence 725 942Depreciation 7,175 5,312Loss on disposal of property, plant and equipment 1,115 53Amortisation of intangible asset 3,494 4,924(Reversal) Provision for warranty (25) 31(Gain) Loss from fair value adjustments on investment properties (1,144) 2,650Change in fair value of derivative financial instruments (565) (337)Interest income (159) (657)Interest expense 1,717 1,892Net foreign exchange gain (973) (1,547)Operating cash flows before movements in working capital 29,890 26,103Trade receivables 8,526 8,430Other receivables and prepayments (877) 919Inventories 5,651 1,619Trade payables (648) (13,161)Other payables and provisions 8 (1,044)Cash generated from operations 42,550 22,866Interest paid (1,717) (1,892)Income tax paid (3,560) (2,427)Net cash from operating activities 37,273 18,547

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 949CONSOLIDATED STATEMENT OF CASH FLOWSYear ended December 31, 2009GROUP2009 2008$’000 $’000Investing activitiesProceeds on disposal of property, plant and equipment 225 9Purchase of property, plant and equipment (15,081) (40,293)Deposit for vessel payment (5,382) (8,822)Purchase of investment property - (267)Intangible assets (2,724) (3,663)Interest received 159 657Net cash used in investing activities (22,803) (52,379)Financing activitiesDividend paid (8,008) (6,115)Repayment of obligations under finance leases (1,959) (2,603)(Repayment of) Net proceeds from bank borrowings (17,192) 45,405Proceeds from issue of shares 10,820 124Proceeds from derivative financial instrument 721 119Purchase of treasury shares - (1,989)Net cash (used in) from financing activities (15,618) 34,941Net (decrease) increase in cash and cash equivalents (1,148) 1,109Effects of exchange rate changes on the balance of cashheld in foreign currencies (389) 363Cash and cash equivalents at beginning of year 37,649 36,177Cash and cash equivalents at end of year 36,112 37,649See accompanying notes to financial statements.

50a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sNOTES TO FINANCIAL STATEMENTSDecember 31, 20091 GENERALThe Company (Registration No. 1986-01642-R) is incorporated in Singapore with its principal place of business and registered office at 31Ubi Road 1, Aztech Building, Singapore 408694. The Company is listed on the Singapore Exchange Securities Trading Limited. The financialstatements are expressed in Singapore dollars and all values are rounded to the nearest thousand ($’000) unless otherwise indicated.The Company changed its name from Aztech Systems Ltd to Aztech Group Ltd on April 21, 2009.In the previous financial year, the principal activities of the Company are to engage in the design, manufacture and distribution ofmulticommunication products and computer peripherals. As a result of the Group’s internal reorganisation in the current financial year, theprincipal activities of the Company have changed to that of investment holding, sale of electronic products and services.The principal activities of the subsidiaries are disclosed in Note 12 to the financial statements.The consolidated financial statements of the Group and the statement of financial position and statement of changes in equity of the Companyfor the year ended December 31, 2009 were authorised for issue by the Board of Directors on March 15, 2010.2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESBASIS OF ACCOUNTING - The financial statements are prepared in accordance with the historical cost convention, except as disclosed in theaccounting policies below, and are drawn up in accordance with the provisions of the Singapore Companies Act and Singapore Financial ReportingStandards (“FRS”).ADOPTION OF NEW AND REVISED STANDARDS - In the current financial year, the Group has adopted all the new and revised FRSs andInterpretations of FRSs (“INT FRSs”) that are relevant to its operations and effective for annual periods beginning on or after January 1, 2009.The adoption of these new/revised FRSs and INT FRSs does not result in changes to the Group’s and the Company’s accounting policies and hasno material effect on the amounts reported for the current or prior years, except as disclosed below:FRS 1 – Presentation of Financial Statements (Revised)FRS 1(2008) has introduced terminology changes (including revised titles for the financial statements) and changes in the format and contentof the financial statements. In addition, the revised Standard requires the presentation of a third statement of financial position at the beginningof the earliest comparative period presented if the entity applies new accounting policies retrospectively or makes retrospective restatements orreclassifies items in the financial statements.Amendments to FRS 107 Financial Instruments : Disclosures - Improving Disclosures about Financial InstrumentsThe amendments to FRS 107 expand the disclosures required in respect of fair value measurements and liquidity risk. The Group has elected notto provide comparative information for these expanded disclosures in the current year in accordance with the transitional reliefs offered in theseamendments.FRS 108 – Operating SegmentsThe Group adopted FRS 108 with effect from January 1, 2009. FRS 108 requires operating segments to be identified on the basis of internalreports about components of the Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to thesegment and to assess its performance. In contrast, the predecessor Standard (FRS 14 Segment Reporting) required an entity to identify twosets of segments (Business and Geographical), using a risks and rewards approach, with the entity’s ‘system of internal financial reporting to keymanagement personnel’ serving only as the starting point for the identification of such segments. As a result, following the adoption of FRS 108,the identification of the Group’s reportable segments has changed (Note 33).The comparatives have been restated to conform to the requirements of FRS 108.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9512 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)At the date of authorisation of these financial statements, the following FRSs, INT FRSs and amendments to FRSs that are relevant to the Groupand the Company were issued but not effective:FRS 27 (Revised) - Consolidated and separate Financial StatementsFRS 103 (Revised) - Business CombinationsFRS 107 - Financial Instruments: Disclosure regarding reclassification of financial assetsAmendment to FRS 7 - Statement of Cash FlowAmendments to FRS 38 - Intangible AssetsAmendments to FRS 39 - Financial Instruments: Recognition and measurementConsequential amendments were also made to various standards as a result of these new/revised standards.Management anticipates that the adoption of the above FRSs, INT FRSs and amendments to FRSs in future periods will not have a material impacton the financial statements of the Group and of the Company in the period of their initial adoption.BASIS OF CONSOLIDATION - The consolidated financial statements incorporate the financial statements of the Company and entities (includingspecial purpose entities) controlled by the Company (its subsidiaries). Control is achieved when the Company has the power to govern the financialand operating policies of an entity so as to obtain benefits from its activities.The results of subsidiaries acquired or disposed of during the year are included in the consolidated statement of comprehensive income from theeffective date of acquisition or up to the effective date of disposal, as appropriate.Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies into line with those used by othermembers of the Group.All intra-group transactions, balances, income and expenses are eliminated on consolidation.Minority interests in the net assets of the consolidated subsidiaries are identified separately from the Group’s equity therein. Minority interests consistof the amount of those interests at the date of the original business combination (see below) and the minority’s share of changes in equity since thedate of the combination. Losses applicable to the minority in excess of the minority’s interest in the subsidiary’s equity are allocated against theinterests of the Group except to the extent that the minority has a binding obligation and is able to make an additional investment to cover its shareof those losses.In the Company’s financial statements, investments in subsidiaries are carried at cost less any impairment in net recoverable value that has beenrecognised in profit or loss.BUSINESS COMBINATIONS - The acquisition of subsidiaries is accounted for using the purchase method. The cost of the acquisition ismeasured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instrumentsissued by the Group in exchange for control of the acquiree, plus any costs directly attributable to the business combination. The acquiree’sidentifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under FRS 103 are recognised at their fair valuesat the acquisition date, except for non-current assets (or disposal groups) that are classified as held for sale in accordance with FRS 105 Non-Current Assets Held for Sale and Discontinued Operations, which are recognised and measured at fair value less costs to sell.Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being the excess of the cost of the business combinationover the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised. If, after reassessment,the Group’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities exceeds the cost of the businesscombination, the excess is recognised immediately in profit or loss.The interest of minority shareholders in the acquiree is initially measured at the minority’s proportion of the net fair value of the assets, liabilitiesand contingent liabilities recognised.

52a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)FINANCIAL INSTRUMENTS – Financial assets and financial liabilities are recognised on the Group’s statement of financial position when the Groupbecomes a party to the contractual provisions of the instrument.Financial assetsFinancial assets are classified into available-for-sale financial assets and loans and receivables. The classification depends on the nature andpurpose of financial assets and is determined at the time of initial recognition.Effective interest methodThe effective interest method is a method of calculating the amortised cost of a financial instrument and of allocating interest income or expenseover the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts or payments through theexpected life of the financial instrument, or where appropriate, a shorter period.Available-for-sale financial assetsInvestments in club memberships held by the Group are classified as being available-for-sale and are stated at fair value. Fair value is determinedin the manner described in Note 4. Gains and losses arising from changes in fair value are recognised directly in other comprehensive income(revaluation reserve) with the exception of impairment losses, which are recognised directly in profit or loss. Where the investment is disposedof or is determined to be impaired, the cumulative gain or loss previously recognised in other comprehensive income and accumulated in therevaluation reserve is reclassified to profit or loss.Available-for-sale unquoted equity investments are initially recognised at their fair value plus directly attributable acquisition costs. They aresubsequently measured at cost less impairment loss as fair values cannot be reliably measured. Dividends on available-for-sale equity instrumentsare recognised in profit or loss when the Group’s right to receive payments is established.Loans and receivablesTrade receivables and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as“loans and receivables”. Loans and receivables are measured at amortised cost using the effective interest method less impairment. Interest isrecognised by applying the effective interest method, except for short-term receivables when the recognition of interest would be immaterial.Impairment of financial assetsFinancial assets are assessed for indicators of impairment at the end of each reporting period. Financial assets are impaired where there isobjective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cashflows of the investment have been impacted.For available-for-sale equity instruments, a significant or prolonged decline in the fair value of the investment below its cost is considered to beobjective evidence of impairment.For all other financial assets, objective evidence of impairment could include:• significant financial difficulty of the issuer or counterparty; or• default or delinquency in interest or principal payments; or• it becoming probable that the borrower will enter bankruptcy or financial re-organisation.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9532 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)For certain categories of financial assets, such as trade receivables, assets that are assessed not to be impaired individually are, in addition,assessed for impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables could include the Group’s pastexperience of collecting payments, an increase in the number of delayed payments in the portfolio past the average credit period of 45 days, aswell as observable changes in national or local economic conditions that correlate with default on receivables.For financial assets carried at amortised cost, the amount of the impairment is the difference between the asset’s carrying amount and thepresent value of estimated future cash flows, discounted at the original effective interest rate.The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade and otherreceivables where the carrying amount is reduced through the use of an allowance account. When trade and other receivables are uncollectible,they are written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the profit orloss. Changes in the carrying amount of the allowance account are recognised in profit or loss.When an available-for-sale financial asset is considered to be impaired, cumulative gains or losses previously recognised in other comprehensiveincome are reclassified to profit or loss.With the exception of available-for-sale equity investments, if, in a subsequent period, the amount of the impairment loss decreases and thedecrease can be related objectively to an event occurring after the impairment loss was recognised, the previously recognised impairment loss isreversed through profit or loss to the extent the carrying amount of the investment at the date the impairment is reversed does not exceed whatthe amortised cost would have been had the impairment not been recognised.In respect of available-for-sale equity instruments, impairment losses previously recognised in profit or loss are not reversed through profit or loss.Any subsequent increase in fair value after an impairment loss is recognised in other comprehensive income.Derecognition of financial assetsThe Group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or it transfers the financialasset and substantially all the risks and rewards of ownership of the asset to another entity. If the Group neither transfers nor retains substantiallyall the risks and rewards of ownership and continues to control the transferred asset, the Group recognises its retained interest in the asset andan associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferredfinancial asset, the Group continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.Financial liabilities and equity instrumentsClassification as debt or equityFinancial liabilities and equity instruments issued by the Group are classified according to the substance of the contractual arrangements enteredinto and the definitions of a financial liability and an equity instrument.Equity instrumentsAn equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. Equityinstruments are recorded at the proceeds received, net of direct issue costs.

54a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)Treasury sharesWhen the Company purchases its ordinary shares (treasury shares), the consideration paid, including any directly attributable incremental costs,net of income taxes, is deducted from equity attributable to the Company’s owners and presented as “treasury shares” within equity, until theyare cancelled, sold or reissued.When treasury shares are subsequently sold or reissued, the cost of the treasury shares is reversed from the treasury shares account and therealised gain or loss on sale or reissue, net of any directly attributable incremental transaction costs and related income tax, is recognised in theshare capital of the Company.WarrantsProceeds from the issuance of warrants are credited to the warrant reserve. When the warrants are exercised, the value of such warrantsexercised standing to the credit of the warrant reserve account will be transferred to the share capital account. At the expiry of the warrants, thebalance in the warrant reserve will be transferred to the share capital reserve.Financial liabilitiesTrade and other payables are initially measured at fair value, net of transaction costs, and are subsequently measured at amortised cost, usingthe effective interest method, with interest expense recognised on an effective yield basis.Interest-bearing bank loans and overdrafts are initially measured at fair value, and are subsequently measured at amortised cost, using theeffective interest method. Any difference between the proceeds (net of transaction costs) and the settlement or redemption of borrowings isrecognised over the term of the borrowings in accordance with the Group’s accounting policy for borrowing costs (see below).Derivative financial instrumentsThe Group enters into foreign currency forward contracts and interest rate swaps to manage its exposure to foreign exchange and interest raterisk, respectively. Further details of derivative financial instruments are disclosed in Note 10.Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to their fair valueat the end of each reporting period. The resulting gain or loss is recognised in profit or loss immediately.INVENTORIES - Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where applicable, directlabour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Cost is calculatedusing the weighted average method. Net realisable value represents the estimated selling price less all estimated costs of completion and coststo be incurred in marketing, selling and distribution.PROPERTY, PLANT AND EQUIPMENT - Property, plant and equipment are carried at cost, less accumulated depreciation and any impairmentloss where the recoverable amount of the asset is estimated to be lower than its carrying amount.The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in profit or loss.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9552 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)Depreciation is charged so as to write off the cost of assets, other than freehold land and properties under construction, over their estimateduseful lives, using the straight-line method, on the following bases:Leasehold property - over the terms of lease, which are from 1.75% to 4%Computer and office equipments - 20% to 33.33%Factory equipments - 12.5% to 20%Factory furniture and fittings - 20%Vessels - 4% to 10%Dry-docking expenditure - 20%Assets on board of the vessels - 33.33%Office furniture and fittings - 20%Research and development equipment and tools - 20% to 33.33%Software applications - 33.33%Motor vehicles - 20%Vessels and other assets under construction are stated at cost. These costs include all progress billings received in accordance with theconstruction contracts, interest charges arising from borrowings used to finance the construction and other direct costs. Vessels and other assetsunder construction are not depreciated until such time they are completed and available for operational use.Vessel component costs include the cost of major components which are usually replaced or renewed in connection with a dry docking when avessel is delivered. The assets are stated at cost less accumulated depreciation and accumulated impairment losses. The vessel component costsare depreciated over the estimated period to the first dry docking. The Group subsequently capitalises dry docking costs as they are incurred anddepreciates these costs over their estimated useful lives.The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of anychanges in estimate accounted for on a prospective basis.Fully depreciated assets still in use are retained in the financial statements.Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, if there is no certaintythat the lessee will obtain ownership by the end of the lease term, the asset shall be fully depreciated over the shorter of the lease term and itsuseful life.The gain or loss arising on disposal or retirement of an item of property, plant and equipment is determined as the difference between the salesproceeds and the carrying amounts of the asset and is recognised in profit or loss.INVESTMENT PROPERTY - Investment property, which is property held to earn rentals and/or for capital appreciation, is measured initially atits cost, including transaction costs. Subsequent to initial recognition, investment property is measured at fair value. Gains or losses arising fromchanges in the fair value of investment property are included in profit or loss for the period in which they arise.

56a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)INTANGIBLE ASSETSInternally-generated intangible assets - research and development expenditureExpenditure on research activities is recognised as an expense in the period in which it is incurred.An internally-generated intangible asset arising from development (or from the development phase of an internal project) is recognised if, and onlyif, all of the following have been demonstrated:• the technical feasibility of completing the intangible asset so that it will be available for use or sale;• the intention to complete the intangible asset and use or sell it;• the ability to use or sell the intangible asset;• how the intangible asset will generate probable future economic benefits;• the availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset;and• the ability to measure reliably the expenditure attributable to the intangible asset during its development.The amount initially recognised for internally-generated intangible assets is the sum of the expenditure incurred from the date when the intangibleasset first meets the recognition criteria listed above. Development costs that have been capitalised as intangible assets are amortised from thecommencement of the commercial production on a straight-line basis over the period of its expected benefits, which normally does not exceed3 years. Where no internally generated asset can be recognised, development expenditure is charged to profit or loss in the period in which it isincurred.Subsequent to initial recognition, internally-generated intangible assets are reported at cost less accumulated amortisation and accumulatedimpairment losses.IMPAIRMENT OF TANGIBLE AND INTANGIBLE ASSETS EXCLUDING GOODWILL - At the end of each reporting period, the Group reviews thecarrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairmentloss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (ifany). Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cashgeneratingunit to which the asset belongs.Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment annually, and whenever thereis an indication that the asset may be impaired.Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows arediscounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risksspecific to the asset.If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset(cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss.Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate ofits recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had noimpairment loss been recognised for the asset (cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediatelyin profit or loss.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9572 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)PROVISIONS - Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, and it isprobable that the Group will be required to settle that obligation. Provisions are measured at the directors’ best estimate of the expenditurerequired to settle the obligation and a reliable estimate can be made of the amount of the obligation.The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reportingperiod, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimatedto settle the present obligation, its carrying amount is the present value of those cash flows.When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable isrecognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.WarrantiesProvision for warranty costs are recognised at the date of sale of the relevant products, at the directors’ best estimate of the expenditure requiredto settle the Group’s obligation.LEASES - Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownershipto the lessee. All other leases are classified as operating leases.The Group as lessorRental income from operating leases is recognised on a straight-line basis over the term of the relevant lease unless another systematic basis ismore representative of the time pattern in which use benefit derived from the leased asset is diminished. Initial direct costs incurred in negotiatingand arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the leaseterm.Rental income from subletting arrangements is recognised on a straight-line basis over the term of the relevant lease.The Group as lesseeAssets held under finance leases are recognised as assets of the Group at their fair value at the inception of the lease or, if lower, at the presentvalue of the minimum lease payments. The corresponding liability to the lessor is included in the statement of financial position as a finance leaseobligation. Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate ofinterest on the remaining balance of the liability. Finance charges are charged directly to profit or loss, unless they are directly attributable toqualifying assets, in which case they are capitalised in accordance with the Group’s general policy on borrowing costs (see below). Contingentrentals are recognised as expenses in the periods in which they are incurred.Rentals payable under operating leases are charged to profit or loss on a straight-line basis over the term of the relevant lease unless anothersystematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentalsarising under operating leases are recognised as an expense in the period in which they are incurred.In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit ofincentives is recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representativeof the time pattern in which economic benefits from the leased asset are consumed.

58a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)SHARE-BASED PAYMENTS - The Group issues equity-settled share-based payments to certain employees. Equity-settled share-basedpayments are measured at fair value (excluding the effect of non market-based vesting conditions) at the date of grant. The fair value determinedat the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Group’sestimate of shares that will eventually vest and adjusted for the effect of non market-based vesting conditions.Fair value is measured using the Black-Scholes pricing model. The expected life used in the model has been adjusted, based on management’sbest estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations.REVENUE RECOGNITION - Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimatedcustomer returns, rebates and other similar allowances.Sale of goodsRevenue from the sale of goods is recognised when all the following conditions are satisfied:• the Group has transferred to the buyer the significant risks and rewards of ownership of the goods;• the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over thegoods sold;• the amount of revenue can be measured reliably;• it is probable that the economic benefits associated with the transaction will flow to the Group; and• the costs incurred or to be incurred in respect of the transaction can be measured reliably.Chartering incomeRevenue from chartering income is recognised on a straight-line basis over the relevant lease period.Interest incomeInterest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the ratethat exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount.Rental incomeRental income from investment properties is recognised on a straight-line basis over the term of the relevant lease.Dividend incomeDividend income from investments is recognised when the shareholders’ rights to receive payment have been established.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9592 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)BORROWING COSTS - Borrowing costs directly attributable to the acquisition, construction, or production of qualifying assets, which are assetsthat necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such timeas the assets are substantially ready for their intended use or sale. Investment income earned on the temporary investment of specific borrowingspending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.All other borrowing costs are recognised in profit or loss in the period in which they are incurred.RETIREMENT BENEFIT COSTS - Payments to defined contribution retirement benefit plans are charged as an expense as they fall due.Payments made to state-managed retirement benefit schemes, such as the Singapore Central Provident Fund, are dealt with as payments todefined contribution plans where the Group’s obligations under the plans are equivalent to those arising in a defined contribution retirementbenefit plan.EMPLOYEE LEAVE ENTITLEMENT - Employee entitlements to annual leave are recognised when they accrue to employees. A provision is madefor the estimated liability for annual leave as a result of services rendered by employees up to the end of the reporting period.PROFIT SHARING SCHEME - Certain directors are entitled to a share of the profit under the profit sharing scheme as disclosed in the Directors’Report. A provision is made for the estimated liability under the profit sharing scheme.INCOME TAX - Income tax expense represents the sum of the tax currently payable and deferred tax.The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the statement of comprehensiveincome because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are nottaxable or tax deductible. The Group’s liability for current tax is calculated using tax rates (and tax laws) that have been enacted or substantivelyenacted in countries where the Group and the subsidiaries operate by the end of the reporting period.Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial statements and the correspondingtax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities aregenerally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxableprofits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if thetemporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in atransaction that affects neither the taxable profit nor the accounting profit.Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries, except where the Group is able tocontrol the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probablethat sufficient taxable profits will be available to allow all or part of the asset to be recovered.Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realised based on thetax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

60a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities andwhen they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on anet basis. Current and deferred tax are recognised as an expense or income in profit or loss, except when they relate to items credited or debitedoutside profit or loss (either in other comprehensive income or directly in equity), in which case the tax is also recognised directly outside profitor loss (either in other comprehensive income or directly in equity, respectively), or where they arise from the initial accounting for a businesscombination. In the case of a business combination, the tax effect is taken into account in calculating goodwill or determining the excess of theacquirer’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities over cost.FOREIGN CURRENCY TRANSACTIONS AND TRANSLATION - The individual financial statements of each Group entity are measured andpresented in the currency of the primary economic environment in which the entity operates (its functional currency). The consolidated financialstatements of the Group, the statement of financial position and the statement of changes in equity of the Company are presented in Singaporedollars, which is the functional currency of the Company, and the presentation currency for the consolidated financial statements.In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency are recordedat the rate of exchange prevailing on the date of the transaction. At the end of each reporting period, monetary items denominated in foreigncurrencies are retranslated at the rates prevailing at the end of the reporting period. Non-monetary items carried at fair value that are denominatedin foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items that aremeasured in terms of historical cost in a foreign currency are not retranslated.Exchange differences arising on the settlement of monetary items, and on retranslation of monetary items are included in profit or loss forthe period. Exchange differences arising on the retranslation of non-monetary items carried at fair value are included in profit or loss for theperiod except for differences arising on the retranslation of non-monetary items in respect of which gains and losses are recognised directly inother comprehensive income. For such non-monetary items, any exchange component of that gain or loss is also recognised directly in othercomprehensive income.Exchange differences which relate to assets under construction for future productive use, are included in the cost of those assets where they areregarded as an adjustment to interest costs on foreign currency borrowings.For the purpose of presenting consolidated financial statements, the assets and liabilities of the Group’s foreign operations (including comparatives)are expressed in Singapore dollars using exchange rates prevailing at the end of the reporting period. Income and expense items (includingcomparatives) are translated at the average exchange rates for the period, unless exchange rates fluctuated significantly during that period,in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognised in othercomprehensive income and accumulated in a separate component of equity. On the disposal of a foreign operation, the cumulative amount of theexchange differences relating to that foreign operation accumulated in a separate component of equity, shall be reclassified from equity to profitor loss (as a reclassification adjustment) when the gain or loss is recognised.On consolidation, exchange differences arising from the translation of the net investment in foreign entities (including monetary items that, insubstance, form part of the net investment in foreign entities) are recognised in other comprehensive income and accumulated in foreign currencytranslation reserve (attributed to minority interest, as appropriate).Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operationand translated at the closing rate.CASH AND CASH EQUIVALENTS - Cash and cash equivalents comprise cash on hand, demand deposits and other short-term highly liquidinvestments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9613 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTYIn the application of the Group’s accounting policies, which are described in Note 2, management is required to make judgements, estimates andassumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associatedassumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from theseestimates.The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period inwhich the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects bothcurrent and future periods.Critical judgements in applying the Group’s accounting policiesManagement is of the opinion that any instances of application of judgements are not expected to have a significant effect on the amountsrecognised in the financial statements (apart from those involving estimations which are dealt with below).Key sources of estimation uncertaintyThe key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have asignificant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussedbelow.Estimated impairment of deferred development costsDetermining whether deferred development cost is impaired requires an estimation of the value in use of the development projects. The value inuse calculation requires the Group to estimate the future cash flows expected to arise from such projects and a suitable discount rate in order tocalculate the present value. Where the actual future cash flows are less than expected, a material impairment loss may arise. As at December31, 2009, the carrying amount of deferred development cost is $4,214,000 (2008 : $4,984,000).Estimated impairment of receivablesWhen there is objective evidence of impairment loss, the Group takes into consideration the estimation of future cash flows. The amount ofthe impairment loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows(excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate (i.e. the effectiveinterest rate computed at initial recognition). Where the actual future cash flows are less than expected, a material impairment loss may arise.As at December 31, 2009, the carrying amount of trade receivables is $27,277,000 (2008 : $36,132,000) (net of allowance for doubtful debtsof $552,000 (2008 : $539,000).Estimated allowance for inventoriesAt the end of the reporting period, the management of the Group carries out a review on a product-by-product and on an aging basis tomake allowance for obsolete and slow-moving inventory items. The management estimates the net realisable value for such inventoryitems based primarily on the current market conditions. As at December 31, 2009, the allowance for inventories was $2,259,000(2008 : $2,369,000).Estimated impairment in value of investment in subsidiariesDetermining whether investment in subsidiaries is impaired involves the consideration of the performance of the subsidiaries and the marketconditions in which the subsidiaries operate in. This affects the Company’s share of net assets of the subsidiaries. During the year, the managementof the Company has considered its investment in its subsidiaries and as at December 31, 2009, the impairment loss balance was $7,192,000(2008 : $43,920,000).If the performance of the subsidiaries and/or market condition was to deteriorate which will affect the Group’s share of net assets of thesubsidiaries, additional impairments may be required.

62a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s3 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY (cont’d)Estimated valuation of the investment propertiesAs described in Note 2, investment properties are stated at fair value based on the valuation performed by independent professional valuers. Indetermining the fair value, the valuers have determined the fair values using various methods of valuation which involve the making of certainassumptions and the use of estimates. In relying on the valuation reports of the professional valuers, the management has exercised judgementin arriving at a value which is reflective of the current market conditions. As at December 31, 2009, the fair value of investment properties were$12,323,000 (2008 : $12,656,000).Depreciation of property, plant and equipmentThe Group depreciates its property, plant and equipment over their estimated useful lives and after taking into account their estimated residualvalues using the straight line method. The estimated useful life reflects the management’s estimate of the periods that the Group intends to derivefuture economic benefits from the use of the Group’s property, plant and equipment. The residual values reflect the management’s estimatedamount that the Group would currently obtain from disposal of the asset, after deducting the estimated costs of disposal, if the assets werealready of the age and in the condition expected at the end of its useful life. As at December 31, 2009, the carrying amounts of property, plantand equipment was $77,747,000 (2008 : $62,193,000).Estimated service life, scrap value and recoverable amount of vesselsThe estimated service life and scrap value of the vessels are assessed annually and adjusted if necessary. Irrespective of indications ofimpairment, the recoverable values of vessels are determined at least annually based on an independent broker’s valuations and calculated valuein use. Significant changes in the estimated service life and scrap values and the result of the impairment test of vessels and of vessels underconstruction may have an impact on operating income. The book value of vessels is disclosed in Note 13 and the contractual commitmentsregarding acquisition of vessels are disclosed in Note 32.According to the impairment test, no vessels or vessels under construction have been determined as having a risk of impairment as at December31, 2009. The recoverable amount of the vessels is estimated based on the calculated value in use. The key assumptions for the calculation of thevalue in use are the vessel’s estimated future earnings generated from the materials supply contract worth a total of approximately $250 millionand operating costs and a risk adjusted weighted average cost of capital of 5% (2008: 5%).

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9634 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT(a)Categories of financial instrumentsThe following table sets out the financial instruments as at the end of the reporting period:GROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Financial assetsDerivative financial instruments - 205 - -Trade and other receivables(including cash and cash equivalents) 71,600 84,233 54,922 48,497Available-for-sale financial assets 555 556 516 516Financial liabilitiesDerivative financial instruments 34 85 - -Trade and other payables(including loans and finance leases) 81,303 102,836 20,190 19,591(b)Financial risk management policies and objectivesThe Group has a system of controls in place to create an acceptable balance between the cost of risks occurring and the cost of managingthe risks. The management continually monitors the Group’s risk management process to ensure that an appropriate balance betweenrisk and control is achieved. Risk management policies and systems are reviewed regularly to reflect changes in market conditions andthe Group activities.The Audit Committee oversees how management monitors compliance with the Group’s risk management policies and procedures andreviews the adequacy of the risk management framework in relation to the risks faced by the Group. The Audit Committee is assisted inits oversight role by Internal Audit. Internal Audit undertakes both regular and ad hoc reviews of risk management control and procedures,the results of which are reported to the Audit Committee.

64a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (cont’d)(b)Financial risk management policies and objectives (cont’d)There has been no change to the Group’s exposure to these financial risks or the manner in which it manages and measures the risk.Market risk exposures are measured using sensitivity analysis indicated below.(i)Foreign exchange risk managementThe Group is exposed to foreign currency risk on sales, purchases and borrowings that are denominated in a currency other thanthe respective functional currencies of Group entities. The currency that gives rise to this risk is primarily United States dollars.The Group manages foreign currency risk by matching assets and liabilities in the same currency denomination and supplementedwith appropriate financial instruments where necessary. The Group uses derivative financial instruments to mitigate the financialimpact associated with foreign currency fluctuation relating to certain forecasted transactions.The carrying amounts of foreign currency denominated monetary assets and monetary liabilities at the end of the reporting periodare as follows:GROUPCOMPANYLiabilities Assets Liabilities Assets2009 2008 2009 2008 2009 2008 2009 2008$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000Singapore dollars - 54 3,000 - - - - -Renminbi 2,748 2,366 7,008 12,120 - - - -United States dollars 56,474 76,177 34,883 38,304 7,294 8,105 522 9,283Euro 1 9 87 282 - - - -Hong Kong dollars - - 3 2 - 1,124 - -Foreign currency sensitivityThe following analyses detail the sensitivity to a 5% increase and decrease in the Singapore dollar against the relevant foreigncurrencies. 5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel andrepresents management’s assessment of the possible change in foreign exchange rates. The sensitivity analysis includes onlyoutstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreigncurrency rates. The sensitivity analysis includes external loans as well as loans to foreign operations within the Group where thedenomination of the loan is in a currency other than the currency of the lender or the borrower.If the Singapore dollar strengthens/weakens by 5% against the United States dollar with all other variables held constant, theGroup’s profit for the year ended December 31, 2009 would increase/decrease by $1,082,000 (2008 : $1,894,000) respectively.If the Singapore dollar strengthens/weakens by 5% against the United States dollar with all other variables held constant, theCompany’s profit for the year ended December 31, 2009 would decrease/increase by $339,000 (2008 : $59,000) respectively.The Group’s sensitivity to foreign currency has decreased during the current year mainly due to the decrease in foreign currencyborrowings.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9654 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (cont’d)(b)Financial risk management policies and objectives (cont’d)(ii)Interest rate risk managementThe Group’s exposure to the risk of changes in market interest rates relates primarily to the Group’s debt obligations with floatinginterest rates. The Group monitors the movements in interest rates on an ongoing basis and evaluates the exposure for its debtobligations.Interest rate sensitivityThe sensitivity analysis below have been determined based on the exposure to interest rates for cash and cash equivalents placedwith and borrowing from banks and financial institutions in Singapore, PRC and Hong Kong at the end of the reporting period. Forfloating rate liabilities, the analysis is prepared assuming the amount of liability outstanding at the balance sheet was outstandingfor the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key managementpersonnel and represents management’s assessment of the reasonably possible change in interest rates.If interest rates had been 50 basis points higher/lower with all other variables held constant, the Group’s profit for the year endedDecember 31, 2009 would decrease/increase by $247,000 (2008 : $348,000 respectively). No analysis is prepared at theCompany level as the amount is immaterial.The Group’s sensitivity to interest rates has decreased during the current year mainly due to the decrease in average bankborrowings.(iii)Credit risk managementCredit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial loss to the Group. TheGroup has adopted the policy of only dealing with creditworthy counterparties as a means of mitigating the risk of financial lossesfrom default. Credit risk is managed through the application of credit approvals, credit limits and monitoring procedures. Whereappropriate, the Group obtains collateral from its customers. Cash terms, advance payments and letter of credits are required forcustomers of lower credit standing. An allowance for impairment is made where there is an identified loss event which, based onprevious experience, is evidence of a reduction in the recoverability of the cash flows.As at December 31, 2009, 61.7% (2008 : 55.2%) of trade receivables for the Group relate to amounts due from five (2008 : five)major customers. The Group manages concentration of credit risk by performing credit analysis procedures to assess the potentialcustomers’ credit quality and defines credit limits by customer before offering credit term to any new customer. The credit terms tocustomers are reviewed at least once a year.The Group places its cash with creditworthy institutions.The maximum exposure to credit risk in the event that the counterparties fail to perform their obligations as at the end of thefinancial year in relation to each class of recognised financial assets is the carrying amount of those assets as stated at the end ofthe reporting period, reduced by the effects of any netting agreements with counterparties.(iv)Liquidity risk managementIndividual operating entities within the Group are responsible for their own cash management, including the short term investmentof cash surplus and the raising of loans to cover expected cash demand, subject to approval by the parent company’s board whenthe borrowings exceed certain predetermined levels of authority. The Group’s policy is to regularly monitor its liquidity requirementsand its compliance with lending covenants, to ensure that it maintains sufficient reserves of cash and adequate committed linesof funding from major financial institutions to meet its liability requirements in the short and longer term. Undrawn facilities aredisclosed in Note 18.

66a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (cont’d)(b)Financial risk management policies and objectives (cont’d)(iv)Liquidity risk management (cont’d)Liquidity and interest risk analysisNon-derivative financial liabilitiesThe following tables detail the remaining contractual maturity for non-derivative financial liabilities. The tables have been drawnup based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group and the Companycan be required to pay. The table includes both interest and principal cash flows. The adjustment column represents the possiblefuture cash flows attributable to the instrument included in the maturity analysis which is not included in the carrying amount of thefinancial liability at the end of the reporting period.GROUPWeighted Onaverage demand Withineffective or within 2 to Afterinterest rate 1 year 5 years 5 years Adjustment Total% $’000 $’000 $’000 $’000 $’0002009Non-interest bearing - 31,903 - - - 31,903Finance leaseliability 2.9% 805 402 - (26) 1,181Bank loans 2.3% 29,506 20,024 - (1,311) 48,2192008Non-interest bearing - 33,202 - - - 33,202Finance leaseliability 3.0% 2,002 1,239 - (91) 3,150Bank loans 3.9% 40,375 29,684 - (3,575) 66,484COMPANY2009Non-interest bearing - 15,985 - - - 15,985Bank loans 2.7% 4,215 - - (10) 4,2052008Non-interest bearing - 12,016 - - - 12,016Bank loans 4.2% 7,616 - - (41) 7,575

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9674 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (cont’d)(b)Financial risk management policies and objectives (cont’d)(iv)Liquidity risk management (cont’d)Non-derivative financial assetsThe following table details the expected maturity for non-derivative financial assets. The tables below have been drawn up based onthe undiscounted contractual maturities of the financial assets including interest that will be earned on those assets except wherethe Group and the Company anticipates that the cash flow will occur in a different period. The adjustment column represents thepossible future cash flows attributable to the instrument included in the maturity analysis which are not included in the carryingamount of the financial asset on the statement of financial position.GROUPWeighted Onaverage demand Withineffective or within 2 to Afterinterest rate 1 year 5 years 5 years Adjustment Total% $’000 $’000 $’000 $’000 $’0002009Non-interest bearing - 54,921 - - - 54,921Fixed deposits 0.6% 17,253 - - (19) 17,2342008Non-interest bearing - 55,470 - - - 55,470Fixed deposits 0.9% 29,278 - - (22) 29,256COMPANY2009Non-interest bearing 13,439 - - - 13,439Interest bearing receivable 2.1% 32,330 - - (665) 31,665Fixed deposits 0.1% 10,335 - - (1) 10,3342008Non-interest bearing - 11,835 - - - 11,835Interest bearing receivable 4.7% 21,718 - - (975) 20,743Fixed deposits 0.3% 15,974 - - (4) 15,970.

68a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (cont’d)(b)Financial risk management policies and objectives (cont’d)(v)Fair value of financial assets and financial liabilitiesThe carrying amounts of cash and cash equivalents, trade and other current receivables and payables and other liabilities approximatetheir respective fair values due to the relatively short-term maturity of these financial instruments. The fair values of other classesof financial assets and liabilities are disclosed in the respective notes to financial statements.The fair values of financial assets and financial liabilities are determined as follows:• the fair value of financial assets and financial liabilities with standard terms and conditions and traded on active liquidmarkets are determined with reference to quoted market prices;• the fair value of other financial assets and financial liabilities (excluding derivative instruments) are determined in accordancewith generally accepted pricing models based on discounted cash flow analysis using prices from observable current marketstransactions and dealer quotes for similar instruments; and• the fair value of derivative instruments are calculated using quoted prices. Where such prices are not available, discountedcash flow analysis is used, based on the applicable yield curve of the duration of the instruments for non-optional derivatives,and option pricing models for optional derivatives.The fair value of financial assets and financial liabilities with standard terms and conditions and traded on active liquid markets aredetermined with reference to quoted market prices.Except as detailed in the following table, management considers that the carrying amounts of financial assets and financial liabilitiesrecorded at amortised cost in the financial statements approximate their fair values:GROUP2009 2008Carrying Fair Carrying Fairamount value amount value$’000 $’000 $’000 $’000Financial liabilitiesFinance lease obligations 1,181 1,181 3,150 3,141Bank loans 48,219 48,432 66,484 66,874COMPANYFinancial liabilitiesBank loans 4,205 4,205 7,575 7,587

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9694 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (cont’d)(c)Capital risk management policies and objectivesThe Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern and to maintain anoptimal capital structure to maximise shareholder value. In order to maintain or achieve an optimal capital structure, the Group may adjustthe amount of dividend payment, return capital to shareholders, issue new shares, buy back issued shares, obtain new borrowings or sellassets to reduce borrowings. The Group’s overall strategy remains unchanged from 2008.Management monitors capital based on the Group’s return on shareholders’ fund and net gearing. The return on shareholders’ funds was13.7% for the current financial year ended December 31, 2009 (2008 : 12.9%). Net gearing was 11.8% for the current financial yearended December 31, 2009 (2008 : 33.7%).The return on shareholders’ funds is calculated as net profit attributable to owners of the parent divided by shareholders’ funds as at endof the reporting period.The net gearing (times) is calculated as net borrowings divided by shareholders’ funds. Net borrowings are calculated as total interestbearing loans and borrowings (Note 18) less cash and cash equivalents (Note 7).The Group and the Company are in compliance with all externally imposed financial covenant requirements on long term bank loans forthe financial years ended December 31, 2009 and 2008.5 RELATED COMPANY BALANCESRelated companies in these financial statements refer to members of the Group of companies. The intercompany balances are unsecured,interest-free and are repayable within the next twelve months unless stated otherwise.6 RELATED PARTY TRANSACTIONS(a)(b)Related parties are entities with common direct or indirect shareholders and/or directors. Parties are considered to be related if one partyhas the ability to control the other party or exercise significant influence over the other party in making financial and operating decisions.By virtue of Section 7 of the Singapore Companies Act, Michael Mun Hong Yew is deemed to have an interest in the Company and in allthe subsidiaries of the Company.In accordance with FRS 24 - Related Party Disclosures, the close members of the family of Michael Mun Hong Yew are considered to berelated parties.(c)Some of the Group’s transactions and arrangements are with related parties and the effect of these on the basis determined between theparties are reflected in these financial statements. Such related party transactions are reviewed by the Audit Committee. The balanceswith related parties are unsecured, interest-free and repayable within the next twelve months unless otherwise stated.

70a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s6 RELATED PARTY TRANSACTIONS (cont’d)During the year, Group entities entered into the following transactions with related parties:GROUP2009 2008$’000 $’000(1) Transaction with companies in which Michael Mun Hong Yew has an equity interest:Rental income (71) (71)Sale of goods (1) (66)Purchase of goods 2 1(2) Transaction with companies in which an Independent Director has an interest:Consulting services 134 47Corporate secretarial services 12 18(3) Salaries paid to employees of the Group who are relatives of Michael Mun Hong Yew:Salary expenses 349 401Compensation of directors and key management personnelThe remuneration of Directors and other members of key management during the year was as follows:GROUP2009 2008$’000 $’000Short-term benefits 4,000 3,794Share-based payments 226 132Total 4,226 3,926The remuneration of Directors and key management is determined by the Remuneration Committee having regard to the performance ofindividuals.7 CASH AND BANK BALANCESGROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Cash at bank 18,809 8,234 1,985 698Fixed deposits 17,234 29,256 10,334 15,970Cash on hand 69 159 - 4Total 36,112 37,649 12,319 16,672Bank balances and cash comprise cash held by the Group and the Company and short-term bank deposits with an original maturity of threemonths or less. The carrying amounts of these assets approximate their fair values.Fixed deposits bear interest at a weighted average rate of 0.6% (2008 : 0.9%) per annum and for a tenure of approximately 50 days (2008 : 30days).

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9717 CASH AND BANK BALANCES (cont’d)The Group’s and the Company’s cash and bank balances that are not denominated in the functional currencies of the respective entities are asfollows:GROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Singapore dollars 3,000 - - -Renminbi 5,903 10,997 - -United States dollars 7,795 7,030 313 3,542Euro 87 42 - -Hong Kong dollars 3 2 - -8 TRADE RECEIVABLESGROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Outside parties 27,829 36,671 101 5,744Allowance for doubtful trade receivables (552) (539) - -Total 27,277 36,132 101 5,744The average credit period on sale of goods is 45 days (2008 : 45 days). No interest is charged on the trade receivables.Before accepting any new customer, the Group uses both an internal and external credit scoring system to assess the potential customer’s creditquality and defines credit limits by customer. Limits and scoring attributed to customers are reviewed once per year. 58.7% (2008 : 71.1%) ofthe trade receivables that are neither past due nor impaired have the best credit scoring attributable under credit scoring system used by theGroup.Included in the Group’s trade receivable balance are debtors with a carrying amount of $11.28 million (2008 : $10.43 million) which are pastdue at the end of the reporting period for which the Group has not provided as there has not been a significant change in credit quality and theamounts are still considered recoverable. The Group does not hold any collateral over these balances. The average age of these receivables are41 days (2008 : 36 days) past due.In determining the recoverability of a trade receivable the Group considers any change in the credit quality of the trade receivable from the datecredit was initially granted up to the end of the reporting period. The concentration of credit risk is limited due to the customer base beinglarge and unrelated. Accordingly, the management believes that there is no further impairment required in excess of the allowance for doubtfuldebts.During the year, the Group discounted exporting letters of credit of $6,144,000 (2008 : $10,927,000) to the banks. As part of the discounting, theGroup provided the banks a credit guarantee over the expected losses of those receivables and has recognised the cash received on the transferas a secured borrowing. At the end of the reporting period, the carrying amount of the exporting letters of credit transferred and the associatedliability is $575,000 (2008 : $1,712,000) (Note 18).Included in the allowance for doubtful debts are specific trade receivables with a balance of $525,000 (2008 : $539,000) relating to customerswho have been placed in liquidation. The impairment recognised represents the difference between the carrying amount of the specific tradereceivable and present value of expected liquidation proceeds. The Group does not hold any collateral over these balances.

72a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s8 TRADE RECEIVABLES (cont’d)Movements in the allowance for doubtful debts:GROUP2009 2008$’000 $’000Balance at beginning of the year 539 541Exchange difference (14) (2)Increase in allowance recognised in profit or loss 27 -Balance at end of the year 552 539The Group’s and the Company’s trade receivables that are not denominated in the functional currencies of the respective entities are as follows:GROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000United States dollars 24,390 31,069 101 5,741Euro - 240 - -9 OTHER RECEIVABLES AND PREPAYMENTSGROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000CurrentOther receivables and prepayments 2,430 2,123 249 343Insurance receivable 3,812 - - -Subsidiaries (Notes 5 and 12) - - 46,094 29,594Allowance for doubtful other receivables - - (3,805) (3,805)6,242 2,123 42,538 26,132Non-currentDeposit for vessel payment 2,691 8,822 - -Total 8,933 10,945 42,538 26,132The insurance receivable was for two insurance claims submitted for the damage sustained to two of the Group’s vessels. As at the date of thisreport, one of the insurance claims amounting to $1,817,000 denominated in US$1,296,000 has already been received.The Company’s other receivables due from subsidiaries are repayable on demand and interest-free except for balance with a subsidiary amountingto $31,665,000 (2008 : $20,743,000) which is subject to interest at 1.85% (2008 : 1.85%) per annum above USD SIBOR. The average age ofthese receivables is less than 60 days (2008 : 60 days). The Company has not made any further allowance in 2009 as the management are ofthe view that receivables are recoverable.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9739 OTHER RECEIVABLES AND PREPAYMENTS (cont’d)The Group’s and the Company’s other receivables and prepayments that are not denominated in the functional currencies of the respectiveentities are as follows:GROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Renminbi 1,105 1,123 - -United States dollars 2,698 205 108 -10 DERIVATIVE FINANCIAL INSTRUMENTSAssetsLiabilities2009 2008 2009 2008$’000 $’000 $’000 $’000GROUPForward foreign exchange contracts - 205 (16) (85)Interest rate swap contracts - - (18) -- 205 (34) (85)The derivative financial instruments outstanding as at end of the reporting period are as follows:(i)Forward foreign exchange contractIn the current financial year, the Group has entered into a non-deliverable forward contract for US$ and RMB in which the Group isentitled/obliged to receive/pay the difference between the contracted rate of 6.885 and the prevailing spot price on the nominal amountof US$800,000 per month for a period of 15 months. There is no downsize risk for the first 6 months tenure and the knock-out rate is6.800. As at December 31, 2009, the remaining tenure of the contract was 12 months.In 2008, the Group entered into a US$ versus HK$ structured forward contract which gives the Group opportunities to sell US$1 million/buy HK$ at a more favourable exchange rate than the market exchange rate. The contract had matured during the year.(ii)Interest rate swap contractThe Group has entered into an interest rate swap contract at a fixed rate of 2.175% per annum with the effective date on May 10, 2010on the notional amount of US$3,000,000 which will be amortised over 10 quarters according to the vessel loan repayment schedule.The swap was structured to hedge the USD SIBOR interest rate of the vessel loan by converting from a variable-rate instrument to afixed-rate instrument. As at December 31, 2009, the remaining tenure of the contract was 10 quarters.The Group uses widely recognised valuation models for determining the fair value of forward foreign exchange contracts and interest rateswaps. The models incorporate various inputs including foreign exchange spot and forward rates and interest rate curves. For these financialinstruments, inputs into models are market observable and are therefore included within Level 2 of the fair value hierarchy of FRS 107.

74a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s11 INVENTORIESGROUP2009 2008$’000 $’000Finished goods 9,550 16,989Work-in-progress 4,189 6,180Raw materials 12,985 10,54426,724 33,71312 INVESTMENT IN SUBSIDIARIESCOMPANY2009 2008$’000 $’000Unquoted equity shares, at cost 89,614 98,685Deemed interest (4) 1,114 3,36490,728 102,049Impairment loss (7,192) (43,920)Carrying amount 83,536 58,129Movement in the provision for impairment:COMPANY2009 2008$’000 $’000Balance at beginning of year 43,920 43,920Amount written back during the year (9,114) -Transfer of shareholdings to a subsidiary (27,614) -Balance at end of year 7,192 43,920As disclosed in Note 3, an impairment assessment of the Company’s investment in subsidiaries has been performed to determine if there areindications that the investment might be impaired. The recoverable amounts of the investment are estimated from value-in-use calculations foractive subsidiaries and net book value of assets for dormant subsidiaries. As a result of the above assessment, an impairment write back of$9,114,000 was recognised in profit or loss for the year, as a result of the subsidiary’s return to profitability.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 97512 INVESTMENT IN SUBSIDIARIES (cont’d)The subsidiaries of the Group are set out below:Proportion ofPlace of ownership interest Cost ofincorporation and voting power investmentName of company and operation held by the Group by the Company Principal activity2009 2008 2009 2008% % $’000 $’000Held by the CompanyAztech Electronics Pte Ltd (7) Singapore 100 - 69,130 - Investment holding companyAztech Systems GmbH (2) Germany 100 100 6,550 6,539 Distribution and sale ofmulticommunicationproducts and computer peripheralsand provision of marketing servicesHitemco Pte Ltd Singapore 100 100 3,000 3,000 Development of andinvestment in propertiesAZ United Pte Ltd Singapore 100 100 10,813 10,678 Non-building construction relatedworks, including supply andprocurement of building constructionmaterialsAZ Marine Pte Ltd Singapore 100 100 1,235 1,033 Chartering, operatingand management of seagoing vessels and provisionof marine transportation servicesHeld by Aztech Electronics Pte LtdAZ – Technology Sdn Bhd (1) Malaysia 100 100 - 94 Distribution and sale ofmulticommunication productsand computer peripherals andprovision of marketing servicesAztech Labs, Inc. (2) United States 100 100 - 24,627 Distribution and sale ofof Americamulticommunication products andcomputer peripherals andprovision of marketingservicesAztech International Ltd (1) Hong Kong 100 100 - * Distribution and sales of electronicproducts

76a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s12 INVESTMENT IN SUBSIDIARIES (cont’d)Proportion ofPlace of ownership interest Cost ofincorporation and voting power investmentName of company and operation held by the Group by the Company Principal activity2009 2008 2009 2008% % $’000 $’000Held by Aztech Electronics Pte LtdAztech Systems (Hong Kong) Ltd (1) Hong Kong 100 100 - 44,556 Manufacture and sale ofmulticommunication productsand computer peripheralsAzfin Semiconductors Pte Ltd Singapore 82 82 - 3,000 DormantShiro Corporation Pte Ltd Singapore 100 100 - 550 Sale of frozen and cannedfoodAztech Technologies Pte Ltd Singapore 100 100 - 7,962 Distribution and sale ofmulticommunication productsand computer peripheralsAZ E-lite Pte Ltd (5) Singapore 100 - - - Design and manufactureof electrical and LED lightsand lighting system installationHeld by Shiro Corporation Pte LtdShiro Corporation (HK) Limited (1) Hong Kong 100 100 - 10 Sale of consumerelectronic products andcomputer peripherals andprovision of marketing servicesHeld by Aztech Systems (Hong Kong) LtdAztech Communication PRC 100 100 - - Manufacture and saleDevice (DG) Ltd (1)of multicommunication productsand plastic injection partsHeld by Aztech Communication Device (DG) LtdAztech Communication PRC 100 100 - - Research and development ofDevice (Shenzhen) Ltd (1)multicommunication productsand investment in properties

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 97712 INVESTMENT IN SUBSIDIARIES (cont’d)Proportion ofPlace of ownership interest Cost ofincorporation and voting power investmentName of company and operation held by the Group by the Company Principal activity2009 2008 2009 2008% % $’000 $’000Held by AZ United Pte LtdAZ Resources Pte Ltd (6) Singapore - 100 - - Non-building constructionrelated works, includingsupply of materialsAZ Material Pte Ltd Singapore 100 100 - - Non-building constructionrelated works, includingsupply of materialsThatWeb Solutions PRC - - - - In process of liquidation(Shanghai) Co. Ltd (3)Held by AZ Marine Pte LtdAZ Lavender Pte Ltd Singapore 100 100 - - Ownership and charteringof sea going vesselAZ Lily Pte Ltd Singapore 100 100 - - Ownership and charteringof sea going vesselAZ Orchid Pte Ltd Singapore 100 100 - - Ownership and charteringof sea going vesselAZ Rose Pte Ltd Singapore 100 100 - - Ownership and charteringof sea going vesselAZ Tulip Pte Ltd Singapore 100 100 - - Ownership and charteringof sea going vesselAZ Peony Pte Ltd Singapore 100 100 - - Ownership and charteringof sea going vesselAZ Carnation Pte Ltd Singapore 100 100 - - Ownership and charteringof sea going vesselAZ Sunflower Pte Ltd Singapore 100 100 - - Ownership and charteringof sea going vessel

78a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s12 INVESTMENT IN SUBSIDIARIES (cont’d)Proportion ofPlace of ownership interest Cost ofincorporation and voting power investmentName of company and operation held by the Group by the Company Principal activity2009 2008 2009 2008% % $’000 $’000AZ Iris Pte Ltd Singapore 100 100 - - Ownership and charteringof sea going vesselAZ Jasmine Pte Ltd Singapore 100 100 - - Ownership and charteringof sea going vesselAZ Sakura Pte Ltd Singapore 100 - - - Ownership and charteringof sea going vesselAZ Ivy Pte Ltd Singapore 100 - - - Ownership and charteringof sea going vesselAZ Marigold Pte Ltd Singapore 100 - - - Ownership and charteringof sea going vessel90,728 102,049* Less than $1,000.All the companies are audited by Deloitte & Touche LLP, Singapore except for the subsidiaries that are indicated as follows:(1)Audited by overseas practices of Deloitte Touche Tohmatsu.(2)Not required to be audited by law in its country of incorporation. The net tangible asset and pre-tax profits of the entities are less than 20% of the Group’sconsolidated NTA and pre-tax profits respectively. Their unaudited financial statements have been reviewed as part of the Group audit.(3)Not audited as the company is in the process of liquidation.(4)Deemed interest arose from financial guarantees provided by the Company to banks in respect of financing facilities granted to its subsidiaries and the share optionsgranted under ESOS 2000 by the Company to employees of its subsidiaries. Management has assessed that the fair value of the financial guarantees equivalent to1.0% (2008 : 1.0%) per annum of the amount of financing facilities guaranteed from the dates when the financing facilities were issued.(5)The company was newly incorporated on December 8, 2009 and there were no transactions from date of incorporation to the end of the reporting period. Itsunaudited financial statements has been reviewed as part of the Group audit.(6)On January 22, 2009, the company was disposed at the consideration of $2. At the date of disposal, the company did not own any assets.(7)This subsidiary was newly incorporated on May 27, 2009. All the companies under the Electronics segment, except for Aztech Systems GmbH, were subsequentlytransferred to Aztech Electronics Pte Ltd on July 1, 2009, as part of the Group’s internal organisation exercise.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 97913 PROPERTY, PLANT AND EQUIPMENTResearchandComputer Factory Assets Office developmentLeasehold and office Factory furniture Drydocking on board of furniture equipment Software Motor Constructionproperty equipments equipments and fittings Vessels expenditure the vessels and fittings and tools applications vehicles in progress Total$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000(a) GROUPAt cost:At January 1, 2008 8,282 6,862 34,344 1,332 - - - 3,671 4,350 2,159 1,586 33 62,619Additions - 32 335 51 37,611 1,700 231 3 81 17 232 - 40,293Disposals - (132) (211) - - - - (53) - - - (32) (428)Write off - (3,632) (4,774) (483) - - - (2,435) (3,012) (1,567) - - (15,903)Exchange differences 13 1 46 3 - - - 1 - - - (1) 63At December 31, 2008 8,295 3,131 29,740 903 37,611 1,700 231 1,187 1,419 609 1,818 - 86,644Additions - 29 330 151 24,493 800 411 7 - 113 260 - 26,594Disposals - (30) (3,713) (4,484) (200) (23) (75) - - (22) - (8,547)Transfer 1,208 - - - - - - - - - - - 1,208Exchange differences (251) (34) (677) (28) - - - (8) (5) (4) (18) - (1,025)At December 31, 2009 9,252 3,096 25,680 1,026 57,620 2,300 619 1,111 1,414 718 2,038 - 104,874Accumulated depreciation:At January 1, 2008 (737) (6,047) (17,411) (783) - - - (3,394) (4,094) (2,080) (709) - (35,255)Charge for the year (322) (248) (3,674) (160) (281) (77) (19) (90) (120) (29) (292) - (5,312)Disposals - 128 212 - - - - 26 - - - - 366Write off - 3,632 4,774 483 - - - 2,435 3,012 1,567 - - 15,903Exchange differences (11) (4) (123) (6) - - - (3) (1) (1) (4) - (153)At December 31, 2008 (1,070) (2,539) (16,222) (466) (281) (77) (19) (1,026) (1,203) (543) (1,005) - (24,451)Charge for the year (360) (240) (3,679) (181) (1,649) (403) (152) (79) (97) (59) (276) - (7,175)Disposals - 22 3,713 - 106 - 4 64 - - 20 - 3,929Exchange differences 40 30 451 18 - - - 7 5 3 16 - 570At December 31, 2009 (1,390) (2,727) (15,737) (629) (1,824) (480) (167) (1,034) (1,295) (599) (1,245) - (27,127)Carrying amount:At December 31, 2009 7,862 369 9,943 397 55,796 1,820 452 77 119 119 793 - 77,747At December 31, 2008 7,225 592 13,518 437 37,330 1,623 212 161 216 66 813 - 62,193(i) Factory equipment with net book value of $5,577,195 (2008 : $7,154,121) are under finance lease arrangements Note 21.

80a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s13 PROPERTY, PLANT AND EQUIPMENT (cont’d)ResearchandComputer Factory Office developmentand office Factory furniture and furniture equipment Software Motorequipments equipments fittings and fittings and tools applications vehicles Total$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000(b)COMPANYAt cost:At January 1, 2008 5,342 8,469 483 3,027 4,134 2,035 657 24,147Additions 30 - - - 81 15 62 188Disposals (128) (2) - - - - - (130)Write off (3,632) (4,774) (483) (2,435) (3,012) (1,567) - (15,903)At December 31, 2008 1,612 3,693 - 592 1,203 483 719 8,302Additions 83 83Disposals - (3,693) - (2) - - - (3,695)Intercompany transfer (1,176) - - - (1,140) (566) (353) (3,235)At December 31, 2009 436 - - 590 63 - 366 1,455Accumulated depreciation:At January 1, 2008 (5,156) (8,469) (483) (3,001) (3,989) (2,027) (190) (23,315)Charge for the year (69) - - (7) (81) (5) (114) (276)Disposals 127 2 - - - - - 129Write off 3,632 4,774 483 2,435 3,012 1,567 - 15,903At December 31, 2008 (1,466) (3,693) - (573) (1,058) (465) (304) (7,559)Charge for the year (60) - - (6) (25) (8) (84) (183)Disposals - 3,693 - 2 - - - 3,695Intercompany transfer 1,161 - - - 1,025 473 202 2,861At December 31, 2009 (365) - - (577) (58) - (186) (1,186)Carrying value:At December 31, 2009 71 - - 13 5 - 180 269At December 31, 2008 146 - - 19 145 18 415 743

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 98113 PROPERTY, PLANT AND EQUIPMENT (cont’d)(c)Major property of the Group is as follows:AreaCarryingDescription Location Existing use (in sq metres) Tenure of lease value2009 2008$’000 $’000Leasehold Dongguan Jiu Self use 43,146 50 years with 6,719 7,225Property * Jiang Shui Village, effect fromChang Ping Town, October 1, 2002Dong Guan City,GuangdongProvince PRC* At December 31, 2009, the Group was applying for the land use right certificate and property ownership certificates in respect of the leasehold propertyinterest of $6,719,000 (2008 : $7,225,000) from the relevant PRC government authorities.14 INVESTMENT PROPERTIESGROUP2009 2008$’000 $’000At fair value:At January 1 12,656 14,316Additions - 267Transfer to property, plant and equipment (1,208) -Net increase (decrease) in fair value adjustment 1,144 (2,650)Exchange difference (269) 723At December 31 12,323 12,656The fair values of the Group’s investment properties at December 31, 2009 have been determined on the basis of valuations carried out at theend of the reporting period by an independent valuer having an appropriate recognised professional qualification and recent experience in thelocation and category of the properties being valued. The valuations were arrived at by reference to market evidence of transaction prices forsimilar properties, and were performed in accordance with International Valuation Standards.The property rental income from the Group’s investment properties of which 91.4% (2008 : 24.4%) are leased out under operating leases,amounted to $244,000 (2008 : $83,000). Direct operating expenses (including repairs and maintenance) arising from the rental-generatinginvestment property amounted to $55,000 (2008 : $29,000). Direct operating expenses (including repairs and maintenance) arising from nonrentalgenerating investment property amounted to $43,000 (2008 : $75,000).

82a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s14 INVESTMENT PROPERTIES (cont’d)(a)Major properties of the Group are as follows:AreaDescription Location Existing use (in sq metres) Tenure of lease Fair value2009 2008$’000 $’000Investment Unit B to H, For rental 1,497 50 years with 10,173 9,348Property Level 20 effect fromFortune Building June 26, 2000Junction of JintianRoad and Fuhua3rd Road, FutianDistrict, ShenzhenGuangdongProvince, PRCUnit A Self-occupied 192 50 years with - 1,208Level 20effect fromFortune Building June 26, 2000Junction of JintianRoad and Fuhua3rd Road, FutianDistrict, ShenzhenGuangdongProvince, PRCInvestment ACE Building For rental 545 Freehold 2,150 2,100Property (5th Storey) 146BPaya Lebar RoadSingapore 40901712,323 12,656During the year, the above mentioned Unit A, Level 20 in Fortune Building was transferred out at its fair value from investment propertiesto property, plant and equipment at the date of change in use to owner occupied property.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 98315 AVAILABLE-FOR-SALE FINANCIAL ASSETSGROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000At fair value:Club memberships 555 556 516 516Total 555 556 516 516Fair values of club memberships are determined with reference to quoted market prices at the end of the reporting period. These fall within Level1 of the fair value hierarchy of FRS 107.16 DEFERRED TAXThe following are the major deferred tax liabilities and assets recognised and the movements thereon, during the current and prior reportingperiods:Undistributed Accelerated Propertyprofits of a tax Tax Deferred revaluationsubsidiary depreciation Provisions losses expenditure gain (loss) Total$’000 $’000 $’000 $’000 $’000 $’000 $’000GROUPAt January 1, 2008 - 26 (85) - (348) 989 582Charge (Credit) to profit orloss for the year (Note 28) - 205 56 (876) (201) (948) (1,764)Exchange difference - 2 - - - 15 17At December 31, 2008 - 233 (29) (876) (549) 56 (1,165)Reclassification 152 (152) - (174) - 174 -Charge (Credit) to profit orloss for the year (Note 28) 109 997 (8) 626 480 432 2,636Settlement (156) - - - - - (156)Effects of change in tax rates - (3) - - - - (3)Exchange difference 3 (5) - (7) - (20) (29)At December 31, 2009 108 1,070 (37) (431) (69) 642 1,283COMPANYAt January 1, 2008 - (100) (59) - (348) - (507)Charge (Credit) to profit orloss for the year - 77 59 - (201) - (65)At December 31, 2008 - (23) - - (549) - (572)Charge (Credit) to profit orloss for the year - 7 - - 549 - 556At December 31, 2009 - (16) - - - - (16)

84a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s16 DEFERRED TAX (cont’d)Certain deferred tax assets and liabilities have been offset in accordance with the Group and the Company’s accounting policy. The following isthe analysis of the deferred tax balances for statement of financial position purposes:GROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Deferred tax liabilities 1,474 216 - -Deferred tax assets (191) (1,381) (16) (572)Subject to the agreement by the tax authorities in the relevant foreign tax jurisdictions in which the Group operates and conditions imposed bylaw, the Group has tax losses carryforwards available for offsetting against future taxable income as detailed below. In addition, the Singaporetax loss carryforwards are subject to the retention of majority shareholders as defined.GROUP2009 2008$’000 $’000As at January 1 34,952 38,371Adjustment for prior years (419) (2,343)Adjustment for tax loss expiry (3,243) -Arising in current year 10,890 89Exchange difference (31) 106Group relief (10,354) -Amount utilised (4,200) (1,271)As at December 31 27,595 34,952Deferred tax benefit on above not recorded 5,605 3,811No deferred tax asset has been recognised by the Group in respect of the tax losses amounting to $27,595,000 as at December 31, 2009 (2008: $34,952,000) due to the unpredictability of future profits stream of the relevant subsidiaries.The Group tax loss carryforwards amounting to $8,373,000 (2008 : $14,234,000) are available for an unlimited future period. The remainingtax loss carryforwards amounting to S$19,222,000 (2008 : $20,718,000) have a limited life ranging from 1 to 15 years to offset against futureprofits after which any unutilised amount will be foregone.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 98517 INTANGIBLE ASSETGROUP COMPANY$’000 $’000Deferred development costCosts:At January 1, 2008 12,629 12,145Additions 3,663 3,874Written off (2,300) (2,300)Currency realignment 9 -At December 31, 2008 14,001 13,719Additions 2,724 1,022Disposal - (14,741)Currency realignment 6 -At December 31, 2009 16,731 -Accumulated amortisation:At January 1, 2008 6,384 5,565Amortisation for the year 4,924 5,185Written off (2,300) (2,300)Currency realignment 9 -At December 31, 2008 9,017 8,450Amortisation for the year 3,494 1,201Disposal - (9,651)Currency realignment 6 -At December 31, 2009 12,517 -Carrying amount:At December 31, 2009 4,214 -At December 31, 2008 4,984 5,269The deferred development cost above has finite useful lives, and is amortised. The amortisation period for development costs incurred is betweenone to three years.The amortisation of deferred development cost has been included under administrative expenses.The recoverable amount of the development cost relating to each product is determined from value in use calculations. The key assumptions forthe value in use calculations are those regarding the discount rates, growth rates and expected changes to selling prices and direct costs duringthe period. Management estimates discount rates using pre-tax rates that reflect current market assessments of the time value of money and therisks specific to the product. The growth rates are based on industry growth forecasts. Changes in selling prices and direct costs are based onpast practices and expectations of future changes in the market.The Group prepares cash flow for the following three years based on an estimated growth rate of 5% to 20% for the different product categories.This rate does not exceed the average long-term growth rate for the relevant markets. The rate used to discount the forecast cash flows is 5%.

86a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s18 BORROWINGSCurrent:GROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000UnsecuredBills discounted with recourse 575 1,712 - -Bills payable 6,471 15,359 - -Export trade loans 3,898 5,995 - 1,997Revolving loans 4,205 9,892 4,205 5,578Term loans 6,378 2,297 - -Bank loan for Shenzhen office property 2,877 2,214 - -SecuredVessel loans 4,449 1,887 - -28,853 39,356 4,205 7,575Non-current:UnsecuredTerm loans 7,439 12,083 - -Bank loan for Shenzhen office property - 2,952 - -SecuredVessel loans 11,927 12,093 - -19,366 27,128 - -Total borrowings 48,219 66,484 4,205 7,575The borrowings are repayableas follows:On demand or within one year 28,853 39,356 4,205 7,575In the second year 8,733 11,461 - -In the third year 4,242 7,608 - -In the fourth year 6,017 3,514 - -In the fifth year 374 4,545 - -After five years - - - -48,219 66,484 4,205 7,575Less: Amount due for settlement within 12 months(shown under current liabilities) (28,853) (39,356) (4,205) (7,575)Amount due for settlement after 12 months 19,366 27,128 - -

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 98718 BORROWINGS (cont’d)The Group’s and the Company’s borrowings that are not denominated in the functional currencies of the respective entities are as follows:GROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000United States dollars 37,436 56,579 4,205 7,5751) Trade financeThe Group has banking facilities relating to bills discounted with recourse, trade bills payable, revolving credits export trade loan and bankoverdrafts of $77,238,000 (2008 : $81,526,000), of which $15,149,000 (2008 : $32,958,000) have been utilised as at December 31,2009. These banking facilities are secured by a corporate guarantee from the Company. These banking facilities bear interest rates from1.5% to 5.5% (2008 : 2.2% to 7.5%) per annum.2) Term loansi) amount of $7,190,000 (2008 : $7,190,000) denominated as US$5,000,000 extended to a subsidiary of the Company in 2008. Theloan bears interest at 1.5% per annum over LIBOR or the Lender’s cost of funds, whichever is higher and is repayable in 36 equalmonthly principal instalments commencing June 2009 (2009 : US$1,006,000, 2010 : US$1,754,000, 2011 : US$1,787,000, 2012: US$453,000). As at December 31, 2009, the loan has an outstanding balance of $5,597,000 (2008 : $7,190,000) denominatedas US$3,994,000 (2008 : US$5,000,000).ii)iii)amount of $7,190,000 denominated as US$5,000,000 extended to a subsidiary of the Company in 2008. The loan bears interestat 1.75% per annum over LIBOR or the Lender’s cost of funds, whichever is higher and is repayable in 8 equal quarterly instalmentscommencing November 2009 (2009 : US$625,000, 2010 : US$2,500,000, 2011 : US$1,875,000). As at December 31, 2009, theloan has an outstanding balance of $6,131,000 (2008 : $7,190,000) denominated as US$4,375,000 (2008 : US$5,000,000).amount of $2,186,000 denominated in HK$12,000,000 extended to a subsidiary of the Company on October 30, 2009. The loanbears interest at 1.75% per annum over HIBOR and is repayable in 60 monthly instalments commencing in November 2009 (2009:HK$383,000, 2010: HK$2,320,000, 2011: HK$2,363,000 2012: HK$2,406,000, 2013: HK$2,451,000, 2014: HK$2,077,000).As at December, 31 2009, the loan has an outstanding balance of $2,089,000 (2008 : Nil) denominated as HK$11,617,000 (2008: Nil).3) Bank loan for Shenzhen Office Property:The bank loan of approximately $7,369,000 denominated in HK$40,000,000 was extended to the Group in June 2007 to acquire officeproperty in Shenzhen, PRC is repayable over 3 years (2008 : HK$12,000,000, 2009 : HK$12,000,000 and 2010 : HK$16,000,000). Asat December 31, 2009, the loan which has an outstanding balance of $2,877,000 (2008 : $5,166,000) denominated as HK$16,000,000(2008 : HK$28,000,000) bears interest at HIBOR plus 1.5% per annum calculated on a 365 days basis and the actual number of dayselapsed. The bank loan is secured by a corporate guarantee from the Company.

88a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s18 BORROWINGS (cont’d)4) Vessel loansi) A loan of approximately $16,994,000 (2008 : $13,983,000) denominated as US$11,732,000 (2008 : US$9,723,000) wasextended to a subsidiary of the Company to purchase 2 tug boats and 6 barges. The loan bears interest at 1.85% per annumover USD SIBOR and is repayable over 5 years commencing in May 2009 (2009: US$1,391,000, 2010: US$2,831,000, 2011:US$1,923,000, 2012: US$1,923,000 and 2013: US$3,664,000). The vessel loan is secured by first priority mortgage over thevessels and a corporate guarantee from the Company. As at December 31, 2009, the outstanding balance of the vessel loan was$14,496,000 (2008 : $13,980,000) denominated as US$10,341,000 (2008: US$9,723,000).ii)During the year, an additional vessel loan of approximately $1,920,000 was extended to a subsidiary of the Company to purchasea tug boat. The loan bears a fixed inertest rate of 5.2% per annum and is repayable in 48 equal monthly instalments commencingin December 2009 (2009: $40,000, 2010: $480,000, 2011: $480,000, 2012: $480,000 and 2012: $440,000). The vessel loanis secured by first priority mortgage over the tug boat and a corporate guarantee from the Company. As at December 31, 2009, thevessel loan has an outstanding balance of $1,880,000 (2008 : Nil).19 TRADE PAYABLESGROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Outside parties 23,330 24,512 175 130The average credit period on purchases of goods is 60 days (2008 : 60 days). No interest has been charged by suppliers on the trade payables.The Group has financial risk management policies in place to ensure that all payables are paid within the credit timeframe.Trade payables principally comprise amounts outstanding for trade purchases and ongoing costs.The Group’s and Company’s trade payables that are not denominated in the functional currencies of the respective entities are as follows:GROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Renminbi 121 124 - -United States dollars 15,875 14,622 11 19Euro 1 9 - -

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 98920 OTHER PAYABLES AND PROVISIONSGROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Subsidiaries (Notes 5 and 12) - - 13,975 8,459Accrued expenses 5,428 6,225 1,183 2,293Customer deposits 1,970 951 33 496Provision for warranty 26 54 - -Other payables 1,149 1,460 619 638Total 8,573 8,690 15,810 11,886Provision for warrantyBalance at January 1 54 57 - -(Reversal) Charge from/to profit or loss (25) 31 - -Utilised (3) (34) - -Balance at December 31 26 54 - -The provision for warranty represents management’s best estimate of the Group’s liability under 12 months warranties granted on computerperipherals and multicommunication products based on past experience and industry averages for defective products.The Group’s and Company’s other payables that are not denominated in the functional currencies of the respective entities are as follows:GROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Singapore dollars - 54 - -Renminbi 2,627 2,242 - -Hong Kong dollars - - - 1,124United States dollars 1,982 1,826 3,078 511

90a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s21 FINANCE LEASESGROUPPresent valueMinimumof minimumlease paymentslease payments2009 2008 2009 2008$’000 $’000 $’000 $’000Amounts payable under finance leases:Within one year 805 2,002 784 1,938In the second to fifth years inclusive 402 1,239 397 1,2121,207 3,241 1,181 3,150Less: Future finance charges (26) (91) - -Present value of lease obligations 1,181 3,150 1,181 3,150Less: Amount due for settlement within 12 months(shown under current liabilities) (784) (1,938)Amount due for settlement after 12 months 397 1,212It is the Group’s policy to acquire certain of its plant and equipment under finance lease arrangements. The average lease term is 3 years. Forthe year ended December 31, 2009, the weighted average effective borrowing rate was 2.9% (2008 : 3.0%) per annum. All leases are on afixed repayment basis and no arrangements have been entered into for contingent rental payments.The fair value of the Group’s lease obligations approximates their carrying amount.The Group’s obligations under finance leases are secured by the lessors’ title to the leased assets (Note 13).The Group’s obligations under finance leases are denominated in United States dollars.22 SHARE CAPITALGROUP AND COMPANY2009 2008 2009 2008’000 ’000 $’000 $’000Number of ordinary sharesIssued and paid up:At January 1 420,999 419,826 110,082 109,958Transferred from share-basedcompensation reserve - - 384 -Issue of rights shares 81,272 - 10,159 -Rights issue expense - - (314) -Conversion of warrants 8 - 2 -Exercise of share options 7,220 1,173 973 124At December 31 509,499 420,999 121,286 110,082

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 99122 SHARE CAPITAL (cont’d)The Company has one class of ordinary shares with no par value which carry no right to fixed income.The Aztech Group Employee Share Option Scheme 2000 (“ESOS 2000”) was approved and adopted at the Company’s Extraordinary GeneralMeeting (“EGM”) held on March 10, 2000.In 2009, 7,220,000 ordinary shares in the Company were issued at the following subscription price, pursuant to the exercise of options grantedunder ESOS 2000:Number of ordinary sharesExercise price2,000,000 $0.1192,120,000 $0.1081,000,000 $0.1121,200,000 $0.186400,000 $0.175500,000 $0.203The new shares ranked pari passu in all respects with existing shares of the Company.On July 17, 2007, the Company allotted 104,390,250 warrants (“Warrants 2010”) at an issue price of $0.02 for each warrant on the basis ofone warrant for every four existing shares. On November 24, 2009, due to the Rights cum Warrants issue exercise, the number and price of theexisting warrants were adjusted accordingly, and an additional 9,948,476 warrants were allotted. Each warrant entitles the warrant holder tosubscribe for one new ordinary share of the Company at an adjusted exercise price of $0.47 (2008 : $0.51) per share. The warrants have anexercise period of 3 years from July 17, 2007 to July 16, 2010. As at December 31, 2009, the outstanding number of warrants is 113,792,726(2008 : 103,844,250).On November 24, 2009, the Company allotted 81,272,000 rights shares with 81,272,000 warrants (“Warrants 2012”) at an issue price of$0.125 for each rights share on the basis of one rights share with one warrant for every five existing shares. Each warrant entitles the warrantholder to subscribe for one new ordinary share of the Company at an exercise price of $0.20 per share. The warrants have an exercise period of 3years from November 24, 2009 to November 23, 2012. During the year, 8,000 new ordinary shares were issued from the conversion of warrants.As at December 31, 2009, the outstanding number of warrants is 81,264,000.23 TREASURY SHARESGROUP AND COMPANY2009 2008 2009 2008’000 ’000 $’000 $’000Number of ordinary sharesAt beginning of the year 21,859 9,793 5,636 3,647Repurchased during the year - 12,066 - 1,989At end of the year 21,859 21,859 5,636 5,636In 2008, the Company acquired 12,066,000 of its own shares through purchases on the Singapore Exchange. The total amount paid to acquirethe shares was $1,989,000 and had been deducted from shareholders’ equity. The shares are held as “treasury shares”. There was no sharebuy-back during the current financial year.

92a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s24 EMPLOYEE SHARE BASED COMPENSATION RESERVEEquity-settled share option schemeESOS 2000 was approved and adopted at the Company’s EGM held on March 10, 2000 and will continue in operation for a maximum period of10 years, commencing March 10, 2000.The Company has a share option scheme for all employees of the Group. The scheme is administered by the Remuneration Committee. Optionsare exercisable at price based on the average of the last done prices for the shares of the Company on the Singapore Exchange Securities TradingLimited for the 5 market days preceding the date of grant. The vesting period is 1 to 2 years. If the options remain unexercised after a period of5 years from the date of grant, the options expire. Options are forfeited if the employee leaves the Group before the options vest.Details of the share options outstanding at the end of the reporting period are as follows:GROUP AND COMPANY2009 2008WeightedWeightedNumber average Number averageof share exercise of share exerciseoptions price options price$ $Outstanding at January 1 17,910,000 0.198 11,819,600 0.212Granted during the year 1,004,309 0.196 8,750,000 0.181Forfeited during the year (210,000) 0.285 (842,850) 0.402Exercised during the year (7,220,000) 0.135 (1,173,000) 0.105Expired during the year - (643,750) 0.110Outstanding at December 31 11,484,309 0.196 17,910,000 0.198Exercisable at December 31 6,827,023 0.216 9,260,000 0.214The weighted average share price at the date of exercise for share options exercised during the year was $0.215 (2008 : $0.240). The optionsoutstanding at the end of the year have a weighted average remaining contractual life of 2 years (2008 : 3 years).In 2008, 8,750,000 options were granted. The estimated fair value of the options granted was $347,722.On November 2009, 1,004,309 options were granted as a result of the Rights cum Warrants issue and the price of the existing share options wasadjusted accordingly. The estimated fair value of the options granted was $78,015.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 99324 EMPLOYEE SHARE BASED COMPENSATION RESERVE (cont’d)Date of grant of options Expiry Date Exercise Price Options outstandingDecember 12, 2006 December 12, 2011 $0.232 (“A”)($0.232 at beginning of year)$0.170 (“B”)($0.186 at beginning of year)1,753,330July 27, 2007 July 27, 2012 $0.561 (“A”)($0.561 at beginning of year)$0.410 (“B”)($0.449 at beginning of year)1,402,654August 28, 2008 August 28, 2013 $0.185($0.203 at beginning of year) 1,643,749August 28, 2008 August 28, 2013 $0.160 (“A”)($0.175 at beginning of year)$0.128 (“B”)($0.140 at beginning of year) 6,684,57611,484,309These fair values were calculated using The Black-Scholes pricing model. The inputs into the model were as follows:2009 2008Weighted average share price 0.230 0.155Weighted average exercise price 0.196 0.167Expected volatility 61% 58%Expected life 3.21 years 2.80 yearsRisk free rate 0.97% 1.60%Expected dividend yield 9% 8%Expected volatility was determined by calculating the historical volatility of the Company’s share price over the previous 3 years. The expectedlife used in the model has been adjusted, based on management’s best estimate, for the effects of non transferability, exercise restrictions andbehavioural considerations.The Group and the Company recognised total expenses of $465,000 (2008 : $222,000) related to equity-settled share-based paymenttransactions during the year.

94a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s25 REVENUEGROUP2009 2008$’000 $’000Sales of electronic products 180,098 252,990Supply of building construction materials 96,551 23,463Marine logistic services 3,107 -Sales of food products 511 -280,267 276,45326 OTHER OPERATING INCOMEGROUP2009 2008$’000 $’000Rental income 2,273 1,909Interest income 159 657Exchange gain 1,158 -Gain on revaluation of currency derivatives 565 337Gain from fair value adjustments of investment properties 1,144 -Others 490 630Total 5,789 3,53327 FINANCE COSTSGROUP2009 2008$’000 $’000Bank charges 329 367Interest expense for:Bills payable and short-term trade loans 549 824Finance leases 64 185Vessel loans 454 66Revolving loans, terms loans and bank loansfor Shenzhen office property 650 817Total 2,046 2,259

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 99528 INCOME TAXGROUP2009 2008$’000 $’000Current tax - Singapore - 1,064- Foreign 765 1,350Overprovision in prior years - current tax (763) (265)Deferred tax charge (credit) relating to theorigination and reversal of temporary differences 2,636 (1,764)Under-recognition of deferred tax in prior years (18) -Net 2,620 385Domestic income tax is calculated at 17% (2008 : 18%) of the estimated assessable profit for the year. Taxation for other jurisdictions iscalculated at the rates prevailing in the relevant jurisdictions.The total charge for the year can be reconciled to the accounting profit as follows:GROUP2009 2008$’000 $’000Profit before income tax 18,038 12,618Income tax expense of statutory rate 3,066 2,271Effects of different tax rates of overseas subsidiaries 272 222Effects of change in tax rate 7 (1)Revenue exempt from taxation (1,144) (141)Effects of tax concession (126) (794)Group relief 352 -Non-allowable items 435 491Deferred tax benefit not recognised 2 127Effect of undistributed profits of an overseas subsidiary 109 62Effect of previously unused tax losses recognised as deferred tax assets (27) (728)Utilisation of deferred tax benefits previously not recognised (78) (890)Overprovision in prior years (763) (265)Others 515 31Total income tax expense 2,620 385In 2006, the Company was granted the International Headquarters (“IHQ”) status effective from January 1, 2007 for a period of 5 years subject tothe fulfilment of certain terms and conditions by December 31, 2008. The income from the qualifying IHQ activities was taxed at a concessionaryrate of 10% for the current financial year.During the year, the Company’s IHQ status had been transferred to its subsidiary after the Group’s internal reorganisation with effect from May 1,2009.

96a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s29 NET PROFIT FOR THE YEARNet profit for the year has been arrived at after charging (crediting):GROUP2009 2008$’000 $’000Depreciation and amortisation:Depreciation of property, plant and equipment 7,175 5,312Amortisation of intangible asset 3,494 4,924Total depreciation and amortisation 10,669 10,236Directors’ remuneration:of the Company 2,370 2,292of subsidiaries 102 107Directors’ fees:Directors of the Company 347 348Total 2,819 2,747Employee benefits expense(including Directors’ remuneration):Staff costs (including directors’ remuneration) 17,271 20,619Equity settled share-based payments 465 222Defined contributions plans 687 755Total employee benefits expense 18,423 21,596Fair value (gain) loss on investment properties (1,144) 2,650Net foreign exchange (gain) losses (1,158) 1,605Loss on disposal of plant and equipment 1,115 53Cost of inventories recognised as an expense 223,101 209,810Audit fees paid to auditors:Auditors of the Company 202 244Other auditors 131 151Non-audit fees paid to auditors:Auditors of the Company 18 15Other auditors 53 21

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 99730 EARNINGS PER SHARE2009 2008’000 ’000Number of sharesWeighted average number of ordinary shares forthe purposes of basic earnings per share 411,226 406,186Effect of dilutive potential ordinary shares:Share options 3,991 10,082Warrants 1,693 -Weighted average number of ordinary shares forthe purposes of diluted earnings per share 416,910 416,268EarningsNet profit attributable to owners of the Company ($’000) 15,418 12,233Basic earnings per share (cents) 3.75 3.01Effect of dilutive potential ordinary shares:Share options (0.03) (0.07)Warrants (0.02) -Fully diluted earnings per share (cents) 3.70 2.94Fully diluted earnings per share is based on 416,909,690 (2008 : 416,268,276) ordinary shares assuming the full exercise of share options andWarrants 2012 outstanding during the year and adjusting the weighted average number of ordinary shares to reflect the effect of all potentiallydilutive ordinary shares. The outstanding number of the Warrants 2010 of 113,792,726 (2008 : 103,844,250) have not been included in thecalculation of diluted earnings per share because they are anti-dilutive for the current financial year presented.31 DIVIDEND2009 2008$’000 $’000Ordinary dividends paidOne-tier tax exempt final dividend paidof $0.015 (2008 : $0.01) per ordinaryin respect of the previous financial year 5,987 4,083One-tier tax exempt interim dividend paidof $0.005 (2008 : $0.005) per ordinaryin respect of the current financial year 2,021 2,032In respect of the current year, the Directors proposed that a final one tier tax exempt dividend of $0.0125 per ordinary share will be paid toshareholders on May 11, 2010. This dividend is subject to approval by shareholders at the Annual General Meeting and has not been includedas a liability in these financial statements. The proposed dividend, if approved, is payable to all shareholders on the Register of Members on April27, 2010. The total estimated dividend to be paid is $6,096,000.

98a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s32 CONTINGENT LIABILITIES AND COMMITMENTS(a)Operating lease commitmentsThe Group as lesseeGROUP2009 2008$’000 $’000Minimum lease payments under operating leasesincluded in the profit or loss 2,631 2,892At the end of the reporting period, the commitments in respect of non-cancellable operating leases for office and factory were as follows:GROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Future minimum leasepayments payable:Within one year 2,491 2,568 2,232 2,232In the second to fifthyears inclusive 4,873 7,230 4,717 6,949After five years - - - -Total 7,364 9,798 6,949 9,181Operating lease payments represents rentals payable by the Group for certain of its office properties. Leases are negotiated for an averageterm of 2 years and rentals are fixed for an average of 2 years except for the Company whereby leases are negotiated for a term of 7 yearswith 5% increase in rentals on 3 rd and 5 th year.The Group as lessorThe Group sublets its leased property and leases its investment properties in Singapore and PRC under operating leases. Property rentalincome earned during the year was $2,273,000 (2008 : $1,909,000). The investment properties are expected to generate rental yields of4% on an on going basis. The properties held for rental income have committed tenants for the next 1 to 5 years.At the end of the reporting period date, the Group has contracted with tenants for the following future minimum lease payments:GROUP2009 2008$’000 $’000Within one year 1,874 2,143In the second to fifth year inclusive 1,744 1,326After five years - -3,618 3,469

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 99932 CONTINGENT LIABILITIES AND COMMITMENTS(b)Contingent liabilitiesGROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Banker’s guarantees - unsecured 2,225 2,174 2,015 1,928Corporate guarantee given bythe Company to banks inconnection with banks facilitiesutilised by subsidiaries- unsecured - - 48,219 66,484In addition to the guarantees disclosed above, the Company has given undertakings to provide continuing financial support to certain of itssubsidiaries with capital deficiencies amounting to $8,537,000 (2008 : $3,792,000) to enable them to continue as going concerns and tomeet their obligations for at least 12 months from the date of this report.(c)Capital expenditure commitmentsGROUPCOMPANY2009 2008 2009 2008$’000 $’000 $’000 $’000Contracted for acquisition ofproperty, plant and equipmentbut not provided for in thefinancial statements 5,809 18,065 - -(d)Pursuant to a land use right agreement dated June 15, 2002, a subsidiary of the Company is committed to pay to the local authority inPeople’s Republic of China land management fee of approximately $20,000 (RMB 100,000) per annum with an increment rate of 10%every five years till September 30, 2052.

100a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s33 SEGMENT INFORMATION(a)Business segmentsIn prior years, segment information reported externally was analysed on the basis of the types of goods supplied and services provided bythe Group’s operating divisions (i.e. ODM/OEM, Contract Manufacturing, Retail Distribution, Materials Supply & Marine Logistics). However,information reported to the Group’s chief operating decision maker for the purposes of resource allocation and assessment of segmentperformance is more specifically focused on the business segments. The principal categories of business segments under FRS 108,therefore, are Electronics, Materials Supply & Marine Logistics and Others.Electronics – Design, develop, manufacture and market data communication, voice communication and multimedia productsMaterials Supply and Marine Logistics – Supply and procurement of construction building materials, ownership, chartering, operation andmanagement of sea going vessels and provision of marine transportation services.Others – Food distribution business and property rental services.Information regarding the Group’s reportable segments is presented below. Amounts reported for the prior year have been restated toconform to the requirements of FRS 108. The measurement basis of the Group’s reportable segments is in accordance with its accountingpolicy.2009Materialssupply andIntermarinesegmentElectronics logistics Others elimination Group$’000 $’000 $’000 $’000 $’000RevenueRevenue from external customers 180,098 99,658 511 - 280,267Cost of sales (155,487) (86,890) (463) - (242,840)Gross profit 24,611 12,768 48 - 37,427Other operating income 5,178 751 1,388 (1,528) 5,789Selling and distribution costs (3,081) (118) (133) - (3,332)Administrative expenses (17,143) (3,000) (306) 649 (19,800)Finance costs (1,310) (1,611) (4) 879 (2,046)Profit before income tax 8,255 8,790 993 - 18,038Income tax (499) (1,686) (435) - (2,620)Net profit for the year 7,756 7,104 558 - 15,418Segment assets 160,269 83,898 14,939 (63,964) 195,142Segment liabilities (71,966) (73,818) (991) 63,964 (82,811)Other informationCapital expenditure 4,754 25,772 - - 30,526Depreciation andamortisation expenses 8,378 2,248 43 - 10,669

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 910133 SEGMENT INFORMATION (cont’d)(a)Business segments (cont’d)2008Materialssupply andIntermarinesegmentElectronics logistics Others elimination Group$’000 $’000 $’000 $’000 $’000RevenueRevenue from external customers 252,990 23,463 - - 276,453Cost of sales (214,957) (21,013) - - (235,970)Gross profit 38,033 2,450 - - 40,483Other operating income 4,209 7 83 (766) 3,533Selling and distribution costs (5,362) (1) - - (5,363)Administrative expenses (20,370) (786) (2,767) 147 (23,776)Finance costs (2,062) (816) - 619 (2,259)Profit before income tax 14,448 854 (2,684) - 12,618Income tax (2,041) 712 944 - (385)Net profit for the year 12,407 1,566 (1,740) - 12,233Segment assets 168,733 60,876 13,464 (42,875) 200,198Segment liabilities (89,580) (58,570) (25) 42,875 (105,300)Other informationCapital expenditure 4,507 39,716 - - 44,223Depreciation andamortisation expenses 9,846 390 - - 10,236Revenues from major products and servicesThe Group’s revenues from its major products and services were as follows:GROUP2009 2008$’000 $’000ODM/OEM Sales 86,907 133,046Contract Manufacturing 64,619 96,301Retail Distributions 28,572 23,643Supply and Procurement of Building Construction Materials 96,551 23,463Chartering and Other Logistics Services 3,107 -Food Distribution Business 511 -280,267 276,453

102a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t s33 SEGMENT INFORMATION (cont’d)(b)Geographical informationThe Group operates in two principal geographical areas – Singapore (county of domicile) and China.The Group’s revenue from external customers and information about its segment assets (non-current assets excluding deferred tax assets)by geographical location are detailed below.RevenueNon-Current Assets2009 2008 2009 2008$’000 $’000 $’000 $’000Singapore 146,841 115,038 68,620 56,591China 125,631 152,702 28,862 32,544Others 7,795 8,713 48 76Total 280,267 276,453 97,530 89,211(c)Information about major customersThe Group’s customer base is diversified and includes 3 (2008 : 1) customers with whom transactions have exceeded 10% of the Group’srevenues. In 2009, revenues generated from these customers amounted to approximately $182.20 million (2008 : $59.12 million). Detailsof concentration of credit risk arising from these customers are set out in Note 4.34 EVENTS AFTER THE REPORTING PERIOD(a)(b)Subsequent to the end of the reporting period, the Company issued 18,000 shares at the exercise price of $0.20 with the conversion ofWarrants 2012.Subsequent to the end of the reporting period, the Company issued 109,583 shares at the exercise price of $0.16 pursuant to the exerciseof options granted under ESOS 2000.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9103ANALYSIS OF ShareHOLDINGSAS AT 5 MARCH 2010NO. OF ISSUED SHARES : 509,620,583NO. OF ISSUED SHARES (EXCLUDING TREASURY SHARES) : 487,761,583NUMBER/PERCENTAGE OF TREASURY SHARES : 21,859,000 (4.48%)CLASS OF SHARES : ORDINARY SHARESVOTING RIGHTS (EXCLUDING TREASURY SHARES) : ONE VOTE PER SHAREDISTRIBUTION OF SHAREHOLDINGSSIZE OFNO. OFSHAREHOLDINGS SHAREHOLDERS % NO. OF SHARES %1 - 999 141 1.18 3,304 0.001,000 - 10,000 7,667 64.05 32,480,105 6.6610,001 - 1,000,000 4,135 34.54 201,274,401 41.261,000,001 & ABOVE 28 0.23 254,003,773 52.08TOTAL 11,971 100.00 487,761,583 100.00TOP TWENTY SHAREHOLDERS AS AT 5 MARCH 2010 NO. OF SHARES %MUN HONG YEW 115,105,663 23.60DBS NOMINEES PTE LTD 24,143,819 4.95NG SOK CHENG 16,906,168 3.47UNITED OVERSEAS BANK NOMINEES (PTE) LTD 16,655,804 3.42HSBC (SINGAPORE) NOMINEES PTE LTD 13,761,000 2.82DBS VICKERS SECURITIES (S) PTE LTD 11,018,200 2.26OCBC NOMINEES SINGAPORE PRIVATE LIMITED 9,084,900 1.86OCBC SECURITIES PRIVATE LTD 5,219,140 1.07FOO FONG G 4,688,000 0.96PHILLIP SECURITIES PTE LTD 4,552,828 0.93NG AH KAU @ NG KIM POH 4,403,039 0.90CHIA HEOK MIIN 3,826,000 0.78AVS TECHNOLOGIES PTE LTD 3,636,000 0.75LOW WEI CHONG (LIU WEICONG) 2,214,000 0.45BRAHMANA KARTA SAKRI OR SUDRIANI SAKRI 2,050,000 0.42CHIA KOK HUA 2,000,000 0.41UOB KAY HIAN PTE LTD 1,997,000 0.41CAPITAL INTELLIGENCE LIMITED 1,758,000 0.36LIM & TAN SECURITIES PTE LTD 1,549,200 0.32KIM ENG SECURITIES PTE. LTD. 1,480,012 0.30246,048,773 50.44SUBSTANTIAL SHAREHOLDERNO. OF SHARESDIRECT INTEREST DEEMED INTERESTMUN HONG YEW * 115,105,663 4,836,000* Note:Mun Hong Yew is deemed to have an interest in 1,200,000 shares held by his nominees, OCBC Securities Pte Ltd and 3,636,000 shares held by AVS Technologies Pte Ltd, wherehe is a Director and shareholder.

104a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sANALYSIS OF WARRANTHOLDINGSAS AT 5 MARCH 2010DISTRIBUTION OF WARRANTHOLDINGS – WARRANTS 2010SIZE OFNO. OFWARRANTHOLDINGS WARRANTHOLDERS % NO. OF WARRANTS %1 - 999 252 4.77 92,199 0.081,000 - 10,000 4,258 80.66 15,392,006 13.5210,001 - 1,000,000 758 14.36 47,561,648 41.801,000,001 & ABOVE 11 0.21 50,746,873 44.60TOTAL 5,279 100.00 113,792,726 100.00TOP TWENTY WARRANTHOLDERS AS AT 5 MARCH 2010 NO. OF WARRANTS %MUN HONG YEW 25,373,851 22.30PHILLIP SECURITIES PTE LTD 5,108,406 4.49LIM & TAN SECURITIES PTE LTD 4,470,998 3.93NG SOK CHENG 4,147,310 3.64HSBC (SINGAPORE) NOMINEES PTE LTD 3,090,749 2.72UNITED OVERSEAS BANK NOMINEES PTE LTD 2,251,384 1.98BOO MOH CHUAN 1,505,416 1.32DBS NOMINEES PTE LTD 1,462,970 1.29OCBC SECURITIES PRIVATE LTD 1,170,470 1.03TAN SIAH HWEE 1,095,833 0.96FOO FONG G 1,069,486 0.94DBS VICKERS SECURITIES (S) PTE LTD 988,728 0.87LIM SOON KWONG ARTHUR 947,895 0.83LIM LOO THIAM 882,145 0.78HO WEE FONG 767,083 0.67MUN HON PHENG 750,645 0.66CITIBANK NOMINEES SINGAPORE PTE LTD 708,181 0.62UOB KAY HIAN PTE LTD 678,694 0.60TAN BOON FONG 663,721 0.58LIM CHA WOH 613,666 0.5457,747,631 50.75SUBSTANTIAL WARRANTHOLDERNO. OF WARRANTSDIRECT INTEREST DEEMED INTERESTMUN HONG YEW * 25,373,851 273,958* Note:Mun Hong Yew is deemed to have an interest in 273,958 warrants held by his nominees, OCBC Securities Pte Ltd

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9105ANALYSIS OF WARRANTHOLDINGSAS AT 5 MARCH 2010DISTRIBUTION OF WARRANTHOLDINGS – WARRANTS 2012SIZE OFNO. OFWARRANTHOLDINGS WARRANTHOLDERS % NO. OF WARRANTS %1 - 999 178 3.77 53,901 0.071,000 - 10,000 3,941 83.46 13,376,805 16.4610,001 - 1,000,000 594 12.58 29,173,609 35.911,000,001 & ABOVE 9 0.19 38,647,685 47.56TOTAL 4,722 100.00 81,252,000 100.00TOP TWENTY WARRANTHOLDERS AS AT 5 MARCH 2010 NO. OF WARRANTS %MUN HONG YEW 19,184,277 23.61CIMB-GK SECURITIES PTE. LTD. 4,979,795 6.13NG SOK CHENG 2,817,694 3.47HSBC (SINGAPORE) NOMINEES PTE LTD 2,616,000 3.22LIM & TAN SECURITIES PTE LTD 2,510,100 3.09DBS NOMINEES PTE LTD 2,229,405 2.74DBS VICKERS SECURITIES (S) PTE LTD 1,579,200 1.94UNITED OVERSEAS BANK NOMINEES (PTE) LTD 1,437,039 1.77PHILLIP SECURITIES PTE LTD 1,294,175 1.59OCBC SECURITIES PRIVATE LTD 942,942 1.16OCBC NOMINEES SINGAPORE PRIVATE LIMITED 753,882 0.93LEE MARY 752,000 0.93MAK SENG HONG 743,000 0.91LONG KELLY 662,000 0.81CHIA HEOK MIIN 638,000 0.79AVS TECHNOLOGIES PTE LTD 606,000 0.75LAI WAI LOONG JEFFREY 570,000 0.70UOB KAY HIAN PTE LTD 511,000 0.63MOH HON MENG 500,000 0.62NG TIE JIN (HUANG ZHIREN) 476,000 0.5845,802,509 56.37SUBSTANTIAL WARRANTHOLDERNO. OF WARRANTSDIRECT INTEREST DEEMED INTERESTMUN HONG YEW * 19,184,277 806,000* Note:Mun Hong Yew is deemed to have an interest in 200,000 warrants held by his nominees, OCBC Securities Pte Ltd and 606,000 warrants held by AVS Technologies Pte Ltd, wherehe is a Director and shareholder.Rule 723As at March 5, 2010, approximately 69.290% of the shareholding was held in the hands of the public. As such, Rule 723 is complied with.

106a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sNOTICE OF ANNUAL GENERAL MEETINGNOTICE IS HEREBY GIVEN THAT the Annual General Meeting of AZTECH GROUP LTD will be held at 31 Ubi Road 1, Aztech Building, Singapore 408694on Friday, April 9, 2010 at 10.00 am for the following purposes:AS ORDINARY BUSINESS1. To receive and, if approved, to adopt the Audited Accounts for the financial year ended December 31, 2009 together with the Directors’ Reportand Auditors’ Report thereon. [Resolution 1]2. To declare a final one-tier tax exempt dividend of S$0.0125 per share for the financial year ended December 31, 2009 as recommended by theDirectors. [Resolution 2]3. To approve Directors’ fees of S$345,000 for the financial year ending December 31, 2010. (2009: S$345,000) [Resolution 3]4. To re-elect Mr Khoo Ho Tong who is retiring under Article 107 of the Articles of Association as a Director. [Resolution 4]5. To re-elect Mr Martin Chia Heok Miin who is retiring under Article 107 of the Articles of Association as a Director. [Resolution 5]6. To re-appoint Messrs Deloitte & Touche LLP as auditors of the Company and to authorise the Directors to fix their remuneration. [Resolution 6]7. To transact any other routine business which may be properly transacted at an Annual General Meeting.AS SPECIAL BUSINESSTo consider and, if thought fit, to pass the following resolutions (with or without amendments) as Ordinary Resolutions:8. That authority be and is hereby given to the Directors to:(a) (i) issue shares in the capital of the Company (“Shares”) whether by way of rights, bonus or otherwise; and/or(ii)make or grant offers, agreements or options (collectively, “Instruments”) that might or would require Shares to be issued, includingbut not limited to the creation and issue of (as well as adjustments to) warrants, debentures or other instruments convertible intoShares, at any time and upon such terms and conditions and for such purposes and to such persons as the Directors may, in theirabsolute discretion, deem fit; and(b)(notwithstanding that the authority conferred by this Resolution may have ceased to be in force) issue Shares in pursuance of anyInstrument made or granted by the Directors while this Resolution was in force,provided that:(1) the aggregate number of Shares to be issued pursuant to this Resolution (including Shares to be issued in pursuance of Instruments madeor granted pursuant to this Resolution):(A)(B)by way of renounceable rights issues on a pro rata basis to shareholders of the Company (“Renounceable Rights Issues”) shall notexceed 100 percent of the total number of issued Shares excluding treasury Shares (as calculated in paragraph (3) below); andotherwise than by way of Renounceable Rights issues (“Other Share Issues”) shall not exceed 50 percent of the total number ofissued Shares excluding treasury Shares (as calculated in accordance with paragraph (3) below), of which the aggregate number ofShares to be issued other than on a pro rata basis to shareholders of the Company shall not exceed 20 percent of the total numberof issued Shares excluding treasury Shares (as calculated in accordance with paragraph (3) below);(2) the Renounceable Rights Issues and Other Share Issues shall not, in aggregate, exceed 100 percent of the total number of issued Sharesexcluding treasury Shares (as calculated in paragraph (3) below);

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9107NOTICE OF ANNUAL GENERAL MEETING(3) (subject to such manner of calculation as may be prescribed by the Singapore Exchange Securities Trading Limited (“SGX-ST”)) for thepurpose of determining the aggregate number of Shares that may be issued under paragraphs (1)(A) and (1)(B) above, the percentage ofissued Shares shall be based on the total number of issued Shares excluding treasury Shares at the time this Resolution is passed, afteradjusting for:(i)(ii)new Shares arising from the conversion or exercise of any convertible securities or share options which are outstanding or subsistingat the time this Resolution is passed; andany subsequent bonus issue or consolidation or subdivision of Shares;(4) in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Listing Manual of the SGX-STfor the time being in force (unless such compliance has been waived by the SGX-ST) and the Articles of Association for the time being ofthe Company; and(5) (unless revoked or varied by the Company in General Meeting) the authority conferred by this Resolution shall continue in force until theconclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company isrequired by law to be held, whichever is the earlier. [Resolution 7]9. That authority be and is hereby given to the Directors to issue Shares and/or Instruments other than on a pro-rata basis pursuant to the aforesaidgeneral mandate at a discount not exceeding twenty per cent (20%) to the weighted average price for trades done on the SGX-ST for the fullmarket day on which the placement or subscription agreement in relation to such Shares and/or Instruments is executed, provided that:(a)(b)in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Listing Manual of the SGX-STfor the time being in force (unless such compliance has been waived by the SGX-ST) and the Articles of Association for the time being ofthe Company; and(unless revoked or varied by the Company in General Meeting) the authority conferred by this Resolution shall continue in force until theconclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company isrequired by law to be held, whichever is the earlier. [Resolution 8]10. That approval be and is hereby given to the Directors to allot and issue from time to time such number of shares in the Company as may berequired to be issued pursuant to the exercise of options under the Aztech Group Employees’ Share Option Scheme 2000 which was approvedby the shareholders at an Extraordinary General Meeting of the Company on March 10, 2000 (“ESOS 2000”), Provided always that theaggregate number of shares to be issued pursuant to the ESOS 2000 shall not exceed fifteen per cent (15%) of the total issued share capital ofthe Company from time to time. [Resolution 9]11. It was resolved that:(a)for the purposes of Sections 76C and 76E of the Companies Act (Cap. 50) (“Companies Act”), the exercise by the Directors of the Companyof all powers of the Company to purchase or otherwise acquire issued ordinary shares of the Company (“Shares”), not exceeding inaggregate the Prescribed Limit (as hereinafter defined), at such price(s) as may be determined by the Directors of the Company from timeto time up to the Maximum Price (as hereinafter defined), whether by way of:(i)(ii)market purchase(s) (each a “Market Purchase”) on the SGX-ST;off-market purchase(s) (each an “Off-Market Purchase”) effected otherwise than on the SGX-ST in accordance with any equalaccess scheme(s) as may be determined or formulated by the Directors of the Company as they consider fit, which scheme(s) shallsatisfy all the conditions prescribed by the Companies Act, and otherwise in accordance with all other laws and regulations and rulesof the SGX-ST as may for the time being be applicable; and/orbe and is hereby authorised and approved generally and unconditionally (the “Share Purchase Mandate”);

108a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sNOTICE OF ANNUAL GENERAL MEETING(b)unless varied or revoked by the Company in general meeting, the authority conferred on the Directors of the Company pursuant to theShare Purchase Mandate may be exercised by the Directors at any time and from time to time during the period commencing from thepassing of this Resolution and expiring on the earlier of:(i)(ii)the date on which the next Annual General Meeting of the Company is held; orthe date by which the next Annual General Meeting of the Company is required by law to be held;(c)in this Resolution:“Prescribed Limit” means ten per cent (10%) of the issued ordinary share capital of the Company as at the date of passing of thisResolution; and“Maximum Price” in relation to a Share to be purchased or acquired, means an amount (excluding brokerage, commission, stamp duties,applicable goods and services tax, clearance fees and other related expenses) not exceeding:(i)(ii)in the case of a Market Purchase, 105% of the Average Closing Price of the Shares; andin the case of an Off-Market Purchase pursuant to an equal access scheme, 120% of the Average Closing Price of the Shares;where:“Average Closing Price” means the average of the closing market prices of a Share over the last five (5) market days on whichtransactions in the Shares were recorded on the SGX-ST immediately preceding the date of the Market Purchase by the Company or, asthe case may be, the date of the making of the offer pursuant to the Off-Market Purchase, and deemed to be adjusted for any corporateaction that occurs after the relevant five-day period; and“date of the making of the offer” means the date on which the Company announces its intention to make an offer for the purchase oracquisition of Shares from holders of Shares, stating therein the relevant terms of the equal access scheme for effecting the Off-MarketPurchase; and(d)the Directors of the Company and/or any of them be and are hereby authorised to complete and do all such acts and things (includingexecuting such documents as may be required) as they and/or he may consider expedient or necessary to give effect to the transactionscontemplated by this Resolution. [Resolution 10]NOTICE IS HEREBY GIVEN that the Share Transfer Books and Register of Members of the Company will be closed on April 28, 2010, for the preparationof dividend warrants. If approved, the final one-tier tax exempt dividend of $0.0125 per share for the financial year ended December 31, 2009 will bepaid on May 11, 2010.Duly completed transfers received by the Company’s Share Registrar, B.A.C.S. Pte Ltd of 63 Cantonment Road, Singapore 089758 up to close ofbusiness at 5 p.m. on April 27, 2010 will be registered to determine shareholders’ entitlement to the said dividend. Members whose securities accountswith the Central Depository (Pte) Limited are credited with shares at 5 p.m. on April 27, 2010 will be entitled to the said dividend.BY ORDER OF THE BOARDMs Pavani NagarajahCompany Secretary24 March 2010Singapore

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9109NOTICE OF ANNUAL GENERAL MEETINGNotes:(i)A member entitled to attend and vote at the Meeting is entitled to appoint a proxy to attend and vote in his stead. A member of the Company,which is a corporation, is entitled to appoint its authorised representative or proxy to vote on its behalf.A proxy need not be a member of the Company.The instrument appointing a proxy must be deposited at the Company’s registered office at 31 Ubi Road 1, Aztech Building, Singapore 408694at least 48 hours before the time of the Meeting.(ii)(iii)(iv)(v)(vi)(vii)Resolution 3 is to facilitate payment of Directors’ fees during the financial year in which the fees are incurred. The Directors’ fees will be paidin 4 equal instalments on a quarterly basis, within 30 days of the end of each quarter. The aggregate amount of Directors’ fees provided in theresolution is calculated on the assumption that all the present Directors will hold office for the whole of the financial year ending December 31,2010 (“FY 2010”). Should any Director hold office for only part of FY 2010 and not the whole of FY 2010, the Director’s fee payable to him willbe appropriately pro-rated.If re-elected under Resolution 4, Mr Khoo Ho Tong will remain the Chairman of the Remuneration Committee, and a member of the AuditCommittee and will be considered an Independent Director of the Company.If re-elected under Resolution 5, Mr Martin Chia Heok Miin will remain and will be considered an Executive Director of the Company.Resolution 7 is to empower the Directors to issue shares in the capital of the Company and to make or grant instruments (such as warrantsor debentures) convertible into shares, and to issue shares in pursuance of such instruments, up to a number not exceeding (i) 100% forRenounceable Rights Issues and (ii) 50% for Other Share Issues, of which up to 20% may be issued other than on a pro rata basis to shareholders,provided that the total number of shares which may be issued pursuant to (i) and (ii) shall not exceed 100% of the issued shares (excludingtreasury shares) in the capital of the Company. For the purpose of determining the aggregate number of shares that may be issued, thepercentage of issued shares shall be based on the total number of issued shares (excluding treasury shares) in the capital of the Company atthe time that Resolution 7 is passed, after adjusting for (a) new shares arising from the conversion or exercise of any convertible securities orshare options which are outstanding or subsisting at the time that Resolution 7 is passed, and (b) any subsequent bonus issue or consolidationor subdivision of shares.Resolution 8 is pursuant to measures implemented by the SGX-ST as stated in a press release entitled “SGX introduces further measures tofacilitate fund raising” dated 19 February 2009 and which became effective on 20 February 2009. Under the measures implemented by the SGX-ST, issuers will be allowed to undertake non pro-rata placements of new shares priced at discounts of up to 20% to the weighted average pricefor trades done on the SGX-ST for a full market day on which the placement or subscription agreement in relation to such shares is executed,subject to the conditions that (a) shareholders’ approval be obtained in a separate resolution (the “Resolution”) at a general meeting to issuenew shares on a non pro-rata basis at a discount exceeding 10% but not more than 20%; and (b) that the resolution seeking a general mandatefrom shareholders for issuance of new shares on a non pro-rata basis is not conditional upon the Resolution. It should be noted that under theListing Manual of the SGX-ST, shareholders’ approval is not required for placements of new shares on a non pro-rata basis pursuant to a generalmandate at a discount of up to 10% to the weighted average price for trades done on the SGX-ST for a full market day on which the placementor subscription agreement in relation to such shares is executed.Resolution 9, if passed, will empower the Directors to issue shares pursuant to the exercise of options under the Aztech Group Employees’ ShareOption Scheme 2000, which was approved by the shareholders at an Extraordinary General Meeting of the Company on March 10, 2000 (“ESOS2000”), provided always that the aggregate number of shares to be issued pursuant to ESOS 2000 shall not exceed fifteen per cent (15%) ofthe Company’s issued share capital for the time being. This authority will continue in force until the next Annual General Meeting of the Companyor the expiration of the period within which the next Annual General Meeting is required by law to be held, whichever is the earlier, unless theauthority is previously revoked or varied at a general meeting.(viii) Explanatory Statement to Ordinary Resolution 10Resolution for the Renewal of the Share Buy Back Mandate

110a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sNOTICE OF ANNUAL GENERAL MEETINGSGX-ST assumes no responsibility for the correctness of any of the statements made, reported, contained or opinions expressed in thisexplanatory statement.A. RATIONALE OF THE SHARE BUY BACK MANDATEAny purchase or acquisition of Shares by the Company would have to be made in accordance with, and in the manner prescribed by, theCompanies Act and the rules of the Listing Manual and such other laws and regulations as may be applicable.It is a requirement of the Companies Act that before a company purchases or acquires its own shares, its articles of association must expresslypermit the company to purchase or otherwise acquire the shares issued by it. Article 16 of the Articles empowers the Company to purchase orotherwise acquire any of its issued shares on such terms as the Company may think fit and in the manner prescribed by the Companies Act.It is a requirement that a company which wishes to purchase or acquire its own shares should obtain approval of its shareholders to do so at ageneral meeting of its shareholders. Accordingly, approval is being sought from Shareholders at the AGM for the Share Buy Back Mandate.If approved by the Shareholders at the AGM, the authority conferred by the Share Buy Back Mandate will continue in force until the next AnnualGeneral Meeting of the Company (whereupon it will lapse, unless renewed at such meeting) or until it is varied or revoked by the Company ingeneral meeting (if so varied or revoked prior to the next Annual General Meeting).A share buyback is one of the ways in which the return on equity of a company may be improved, thereby increasing shareholder value. Byobtaining the Share Buy Back Mandate, the Company will have the flexibility to undertake purchases of Shares at any time, subject to marketconditions, during the period when the Share Buy Back Mandate is in force.The Share Buy Back Mandate will also facilitate the return to the Shareholders by the Company of surplus cash (if any) which is in excess of theGroup’s financial needs in an expedient and cost-effective manner.The Directors further believe that Share purchases by the Company may help to mitigate short-term market volatility in the Company’s Shareprice, off-set the effects of short-term speculation and bolster Shareholders’ confidence and employee morale.If and when circumstances permit, the Directors will decide whether to effect the share purchases via market purchases or off-market purchases,after taking into account the amount of surplus cash available, the prevailing market conditions and the most cost-effective and efficient approach.The Directors do not propose to carry out purchases pursuant to the Share Buy Back Mandate to such an extent that would, or in circumstancesthat might, result in a material adverse effect on the financial position of the Group.Shareholders should note that purchases or acquisitions of Shares pursuant to the Share Buy Back Mandate may not be carried out to the fulllimit as authorised. The share purchases will not cause illiquidity or affect orderly trading of the Shares.B. AUTHORITY AND LIMITS OF THE SHARE Buy Back MANDATEThe authority and limitations placed on purchases or acquisitions of Shares by the Company under the proposed Share Buy Back Mandate aresummarised below:(a)Maximum Number of SharesThe total number of Shares which may be purchased or acquired by the Company pursuant to the Share Buy Back Mandate shall notexceed ten percent (10%) of the issued ordinary share capital of the Company as at the date of the last AGM of the Company held beforethe resolution authorising the Share Buy Back Mandate is passed or as at the date on which the resolution authorising the Share Buy BackMandate is passed, whichever is the higher.Purely for illustrative purposes, on the basis of 487,767,583 Shares (excluding treasury shares) in issue as at the Latest Practicable Date,being 15 March 2009 and assuming that no further Shares are issued on or prior to the AGM to be held on 9 April 2010, not more than48,776,758 Shares (representing 10% of the Shares in issue as at that date) may be purchased or acquired by the Company pursuant tothe proposed Share Buy Back Mandate.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9111NOTICE OF ANNUAL GENERAL MEETING(b)Duration of AuthorityPurchases or acquisitions of Shares may be made, at any time and from time to time, by the Company on and from the date of the AGMat which the Share Buy Back Mandate is approved up to the earliest of:(i)(ii)(iii)the date on which the next AGM of the Company is held or required by law to be held;the date on which the share purchases are carried out to the full extent mandated; orthe time when the authority conferred by the Share Buy Back Mandate is revoked or varied by the Shareholders of the Companyin general meeting.The Share Buy Back Mandate may be renewed at each AGM or other general meeting of the Company.(c)Manner of Purchases or Acquisitions of SharesPurchases or acquisitions of Shares may be effected by the Company by way of:(i)(ii)on-market purchases (“Market Purchases”); and/oroff-market purchases, otherwise than on a securities exchange, in accordance with an “equal access scheme” as defined in Section76C of the Companies Act (“Off-Market Purchases”).Market Purchases refer to purchases or acquisitions of Shares by the Company effected on the SGX-ST through the Central Limit OrderBook trading system, and/or through one or more duly licensed dealers appointed by the Company for the purpose.In an Off-Market Purchase, the Directors may impose such terms and conditions which are not inconsistent with the Share Buy BackMandate, the Listing Manual, the Companies Act and other applicable laws and regulations, as they consider fit in the interests of theCompany in connection with or in relation to any equal access scheme or schemes. An equal access scheme must, however, satisfy thefollowing conditions:(i)(ii)(iii)offers for the purchase or acquisition of Shares shall be made to every person who holds Shares to purchase or acquire the samepercentage of their Shares;all of those persons shall be given a reasonable opportunity to accept the offers made; andthe terms of all the offers are the same, except that there shall be disregarded:• differences in consideration attributable to the fact that the offers may relate to Shares with different accrued dividendentitlements;• (if applicable) differences in consideration attributable to the fact that the offers relate to Shares with different amountsremaining unpaid; and• differences in the offers introduced solely to ensure that each person is left with a whole number of Shares.Under the Listing Manual, if the Company wishes to make an Off-Market Purchase, the Company will issue an offer document containing,inter alia, the following information to all Shareholders:(i)(ii)(iii)the terms and conditions of the offer;the period and procedures for acceptances; andthe information required under Rule 883(1), (2), (3), (4) and (5) of the Listing Manual.

112a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sNOTICE OF ANNUAL GENERAL MEETING(d)Maximum Purchase PriceThe purchase price (excluding ancillary expenses such as brokerage, commission, applicable goods and services tax, stamp duties,clearance fees and other related expenses) to be paid for the Shares will be determined by the Directors. However, the purchase price tobe paid for the Shares must not exceed the maximum price (“Maximum Price”) as set out below:(i)(ii)in the case of a Market Purchase, 105% of the Average Closing Price of the Shares; andin the case of an Off-Market Purchase, 120% of the Average Closing Price of the Shares,in each case, excluding related expenses of the purchase or acquisition.For the above purposes:“Average Closing Price” means the average of the closing market prices of a Share over the last five (5) Market Days on which transactionsin the Shares were recorded on the SGX-ST immediately preceding the date of the Market Purchase by the Company or, as the case maybe, the date of the making of the offer pursuant to the Off-Market Purchase, and deemed to be adjusted for any corporate action thatoccurs after the relevant five-day period; and“date of the making of the offer” means the date on which the Company announces its intention to make an offer for the purchase oracquisition of Shares from holders of Shares, stating therein the relevant terms of the equal access scheme for effecting the Off-MarketPurchase.C. PURCHASED SHARES: CANCELLED OR HELD IN TREASURYShares which are purchased or acquired by the Company may be cancelled or held by the Company as treasury shares. All shares purchased bythe Company will be automatically delisted by the SGX-ST.If cancelled, all rights and privileges attached to that Share shall expire on cancellation and certificates in respect thereof will be cancelled anddestroyed by the Company as soon as reasonably practicable following settlement of any such purchase.D. SOURCE OF FUNDSThe Company may, at its discretion, purchase Shares pursuant to the Share Buy Back Mandate out of capital and/or out of distributable profits.The Directors do not propose to exercise the Share Buy Back Mandate in a manner and to such an extent that the working capital position of theGroup would be materially adversely affected.The Company intends to use internal sources of funds and/or external borrowings to finance purchases or acquisitions of its Shares. The amountof funding required for the Company to purchase or acquire its Shares and the financial impact on the Company and the Group arising from suchpurchases or acquisitions of the Shares pursuant to the proposed Share Buy Back Mandate will depend on, inter alia, the aggregate numberof Shares purchased or acquired, the consideration paid at the relevant time, and the amount (if any) borrowed by the Company to fund thepurchases or acquisitions.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9113NOTICE OF ANNUAL GENERAL MEETINGE. SOLVENCY TESTUnder the Companies Act in force as at the Latest Practicable Date, we may not purchase Shares if we know that our Company is not solvent.For this purpose, a company is “solvent” if:(a)(b)the company is able to pay its debts in full at the time of the payment for the purchase and will be able to pay its debts as they fall due inthe normal course of business during the period of 12 months immediately following the date of the payment; andthe value of the company’s assets is not less than the value of its liabilities (including contingent liabilities) and will not after the proposedpurchase, become less than the value of its liabilities (including contingent liabilities) having regard to the most recent financial statementsof the company and all other circumstances that the directors or managers of the company know or ought to know affect, or may affect,such values.F. FINANCIAL EFFECTSThe Company’s total issued share capital will be diminished by the total issue price of the Shares purchased or acquired by the Company if theShares purchased or acquired are cancelled.The financial effects on the Group arising from purchases or acquisitions of Shares which may be made pursuant to the Share Buy Back Mandatewill depend on, inter alia, the aggregate number of Shares purchased or acquired, the consideration paid at the relevant time, and the amount (ifany) borrowed by the Group to fund the purchases or acquisitions.Based on the existing issued and paid-up ordinary share capital of the Company as at the Latest Practicable Date, the purchaseby the Company of 10 per cent (10%) of its issued Shares will result in the purchase or acquisition of 48,776,758 Shares.Assuming the Company purchases or acquires the 48,776,758 Shares at the Maximum Price, the maximum amount of funds required (excludingrelated brokerage, commission, applicable goods and services tax, stamp duties, clearance fees and other related expenses) is:(a) S$12.39 million in the case of Market Purchases of Shares based on S$0.254 per Share (being the price equivalent to five per cent (5%)above the Average Closing Price of the Shares traded on the SGX-ST for the five (5) consecutive Market Days immediately preceding theLatest Practicable Date); and(b)S$14.15 million in the case of Off-Market Purchases of Shares based on S$0.290 per Share (being the price equivalent to twenty per cent(20%) above the Average Closing Price of the Shares traded on the SGX-ST for the five (5) consecutive Market Days immediately precedingthe Latest Practicable Date).For illustrative purposes only, on the basis of the assumptions set out above, and based on the audited financial statements of the Group for thefinancial year ended December 31, 2009, and assuming that:(i) the Share Buy Back Mandate had been effective on January 1, 2009;(ii) the purchases or acquisitions of Shares are financed solely by internal resources;(iii) the Company’s distributable profit is S$15.93 million as at December 31, 2009, taking into account the dividend declared in 2009; and(iv) the capital of the Company is S$121.29 million as at December 31, 2009,

114a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sNOTICE OF ANNUAL GENERAL MEETINGThe financial effects of the purchase or acquisition of such Shares by the Company on the audited financial statements of theGroup for the financial year ended December 31, 2009 would have been as follows:Market PurchasesGroupCompanyBefore Share After Share Before Share After SharePurchase Purchase Purchase PurchaseAs at December 31, 2009Shareholders’ Funds (S$’000) 112,331 99,942 119,684 107,295NTA (S$’000) 108,117 95,728 119,684 107,295Current Assets (S$’000) 97,421 85,032 55,537 43,148Current Liabilities (S$’000) 61,574 61,574 20,190 20,190Total Borrowings (S$’000) 49,400 49,400 4,205 4,205Number of Shares (000) 487,640 438,863 487,640 438,863Financial RatiosNTA per Share (cents) 22.17 21.81 24.54 24.45Earnings per Share (cents) 3.75 4.25 5.82 6.60Gearing (times) 0.44 0.49 0.04 0.04Current Ratio (times) 1.58 1.38 2.75 2.14Off Market PurchasesGroupCompanyBefore Share After Share Before Share After SharePurchase Purchase Purchase PurchaseAs at December 31, 2009Shareholders’ Funds (S$’000) 112,331 98,186 119,684 105,539NTA (S$’000) 108,117 93,972 119,684 105,539Current Assets (S$’000) 97,421 83,276 55,537 41,392Current Liabilities (S$’000) 61,574 61,574 20,190 20,190Total Borrowings (S$’000) 49,400 49,400 4,205 4,205Number of Shares (000) 487,640 438,863 487,640 438,863Financial RatiosNTA per Share (cents) 22.17 21.41 24.54 24.05Earnings per Share (cents) 3.75 4.25 5.82 6.60Gearing (times) 0.44 0.50 0.04 0.04Current Ratio (times) 1.58 1.35 2.75 2.05(1) Total borrowings comprise liabilities arising from borrowings from banks and other financial institutions, and outstanding debt securities.(2) Gearing is computed based on the ratio of total borrowings to shareholders’ funds.(3) Current ratio is derived based on current assets divided by current liabilities.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9115NOTICE OF ANNUAL GENERAL MEETINGFor illustrative purposes, it has been assumed that the purchases or acquisitions of Shares are financed solely by internal resources. Where thepurchase or acquisition of Shares is financed through external borrowings or financing, there would also be an increase in the gearing ratios ofthe Group and the Company and a decline in the current ratios of the Group and the Company, with the actual impact dependent on, inter alia,the number of Shares purchased or acquired and the prices at which the Shares are purchased or acquired.Shareholders should note that the financial effects set out above are for illustration purposes only (based on the aforementionedassumptions). The actual impact will depend on, inter alia, the number and price of the Shares purchased or acquired (if any).In particular, Shareholders should note that the above analysis is based on the audited financial statements of the Group for thefinancial year ended December 31, 2009 and is not necessarily representative of future financial performance.The Company may take into account both financial and non-financial factors (for example, stock market conditions and the performance of theShares) in assessing the relative impact of a share purchase before execution.G. REPORTING REQUIREMENTS UNDER THE COMPANIES ACTWithin 30 days of the passing of a Shareholders’ resolution to approve the purchases of Shares by the Company, the Company shall lodge a copyof such resolution with the Accounting and Corporate Regulatory Authority.The Company shall notify the Accounting and Corporate Regulatory Authority within 30 days of a purchase of Shares on the SGX-ST or otherwise.Such notification shall include the following:(a)(b)(c)(d)(e)(f)(g)(h)the date of the purchase;number of Shares purchased;the number of Shares cancelled;the number of Shares held as treasury shares;the Company’s issued share capital before the purchase;the Company’s issued share capital after the purchase;the amount of consideration paid by the Company for the purchase of the Shares; andwhether the Shares were purchased out of the profits or the capital of the Company.H. REQUIREMENTS IN THE LISTING MANUALUnder the Listing Manual, a listed company may purchase shares by way of Market Purchases at a price per share which is not more than fivepercent (5%) above the average closing market price, being the average of the closing market prices of the shares over the last five (5) MarketDays, on which transactions in the shares were recorded, before the day on which the purchases were made. The Maximum Price for a Share inrelation to Market Purchases by the Company, referred to in section B (d) above, conforms to this restriction.The Listing Manual specifies that a listed company shall report all purchases or acquisitions of its shares to the SGX-ST not later than 9.00 a.m.(i) in the case of a Market Purchase, on the Market Day following the day on which the Market Purchase was effected, and (ii) in the case of anOff-Market Purchase, on the second Market Day after the close of acceptances of the offer. The notification of such purchases or acquisitions tothe SGX-ST shall be in such form, and shall include such details, as may be prescribed by the SGX-ST in the Listing Manual.

116a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sNOTICE OF ANNUAL GENERAL MEETINGThe Listing Manual does not expressly prohibit any purchase of shares by a listed company during any particular time(s). However, as theCompany would be regarded as an “insider” in relation to any proposed purchase or acquisition of its shares, the Company will not undertake anypurchase or acquisition of Shares pursuant to the Share Buy Back Mandate at any time after any matter or development of a price-sensitive naturehas occurred or has been the subject of a decision of the Board until the price-sensitive information has been publicly announced.The Listing Manual requires a company to ensure that at least ten percent (10%) of equity securities (excluding preference shares and convertibleequity securities) in a class that is listed is held by public shareholders. The “public”, as defined under the Listing Manual, are persons otherthan the directors, chief executive officer, substantial shareholders or controlling shareholders of the Company and its subsidiaries, as well as theassociates of such persons.As at the Latest Practicable Date, the public float of the Company stands at 69.291%. If the Share Buy Back Mandate is exercised in full, anda total of 48,776,758 Shares are purchased pursuant to the Share Buy Back Mandate, the public float of the Company will be 65.879%. TheShare Buy Back Mandate will not affect the listing of the Company on SGX-ST by reason of the public float of the Company being reduced tobelow 10% of the total issued share capital of the Company. The Share Buy Back Mandate is also not expected to affect the orderly trading ofthe Company’s Shares on the SGX-ST.I. CERTAIN TAKE-OVER CODE IMPLICATIONSAppendix 2 of the Take-over Code contains the Share Buy-back Guidance Note applicable as at the Latest Practicable Date. Thetake-over implications arising from any purchase or acquisition by the Company of its Shares are set out below:(a)Obligation to Make a Take-over OfferAny resultant increase in the percentage of voting rights held by a Shareholder and persons acting in concert with him, following anypurchase or acquisition of Shares by the Company, will be treated as an acquisition for the purposes of Rule 14 of the Take-over Code(“Rule 14”). Consequently, depending on the number of Shares purchased or acquired by the Company and the Company’s issued sharecapital at that time, a Shareholder or group of Shareholders acting in concert with each other could obtain or consolidate effective controlof the Company and could become obliged to make a take-over offer under Rule 14.(b)Persons Acting in ConcertUnder the Take-over Code, persons acting in concert comprise individuals or companies who, pursuant to an agreement or understanding(whether formal or informal), co-operate, through the acquisition by any of them of shares in a company to obtain or consolidate effectivecontrol of that company. Unless the contrary is established, the following persons, inter alia, will be presumed to be acting in concert,namely, (i) a company with any of its directors (together with their close relatives, related trusts as well as companies controlled by anyof the directors, their close relatives and related trusts), and (ii) a company, its parent, subsidiaries and fellow subsidiaries, and theirassociated companies and companies of which such companies are associated companies, all with each other. For this purpose, acompany is an associated company of another company if the second company owns or controls at least twenty percent (20%) but notmore than fifty percent (50%) of the voting rights of the first-mentioned company.(c) Effect of Rule 14 and Appendix 2The circumstances under which Shareholders (including Directors) and persons acting in concert with them respectively will incur anobligation to make a take-over offer under Rule 14 after a purchase or acquisition of Shares by the Company are set out in Rule 14 andAppendix 2 of the Take-over Code. In general terms, the effect of Rule 14 and Appendix 2 is that, unless exempted, Directors and personsacting in concert with them will incur an obligation to make a take-over offer for the Company under Rule 14 if, as a result of the Companypurchasing or acquiring Shares, the voting rights of such Directors and their concert parties would increase to thirty percent (30%) or more,or, if the voting rights of such Directors and their concert parties fall between thirty percent (30%) and fifty percent (50%) of the Company’svoting rights, the voting rights of such Directors and their concert parties would increase by more than one percent (1%) in any period ofsix (6) months.

F i n a n c i a l S t a t e m e n t sa z t e c h a n n u a l r e p o r t 2 0 0 9117NOTICE OF ANNUAL GENERAL MEETINGUnder Appendix 2 of the Take-over Code, a Shareholder not acting in concert with the Directors will not be required to make a take-overoffer under Rule 14 if, as a result of the Company purchasing or acquiring its Shares, the voting rights of such Shareholder would increaseto thirty percent (30%) or more, or, if such Shareholder holds between thirty percent (30%) and fifty percent (50%) of the Company’svoting rights, the voting rights of such Shareholder would increase by more than one percent (1%) in any period of six (6) months. SuchShareholder need not abstain from voting in respect of the resolution authorising the proposed Share Buy Back Mandate.(d)Directors’ and Substantial Shareholders’ InterestsBased on the Register of Directors’ Shareholdings and the Register of Substantial Shareholders of the Company, as at the Latest PracticableDate, the shareholdings of the Directors and of the Substantial Shareholders in the Company before and after the purchase of Sharespursuant to the proposed Share Buy Back Mandate, assuming (i) the Company purchases the maximum amount of ten percent (10%) ofthe issued ordinary share capital of the Company, and (ii) there is no change in the number of Shares held by the Directors and SubstantialShareholders or which they are deemed to be interested in, will be as follows:-Directors––––––––––––––––––––––––– As at Latest Practicable Date –––––––––––––––––––––––––Before Share Purchase After Share PurchaseTotal Number ofShares in which %Total% Numberinterested(direct and deemed)of IssuedShares (1) of IssuedShares (1)of shareoptions heldTotal Number of Warrants in whichinterested (direct and deemed)Michael Mun Hong Yew (2) 119,941,663 24.590 27.322 0 Aztech Group W100716 – 25,647,809Aztech Group W121123 – 19,990,277Patricia Ng Sok Cheng 18,106,168 3.712 4.124 547,916 Aztech Group W100716 – 4,147,310Aztech Group W121123 – 3,017,694Martin Chia Heok Miin 3,848,000 0.789 0.877 1,643,749 Aztech Group W100716 – 437,784Aztech Group W121123 – 640,000Jeremy Mun Weng Hung 1,044,000 0.214 0.238 0 Aztech Group W100716 – 191,770Aztech Group W121123 – 174,000Colin Ng Teck Sim 888,000 0.182 0.202 0 Aztech Group W100716 – 136,979Aztech Group W121123 – 148,000Philip Tan Tee Yong 600,000 0.123 0.137 0 Aztech Group W100716 – 136,979Aztech Group W121123 – 100,000Khoo Ho Tong 806,000 0.165 0.184 0 Aztech Group W100716 – 136,979Aztech Group W121123 – 135,000Substantial ShareholdersMichael Mun Hong Yew (2) 119,941,663 24.590 27.322 0 Aztech Group W100716 – 25,647,809Aztech Group W121123 – 19,990,277Notes:(1) Based on an issued share capital, (excluding treasury shares) of 487,767,583 Shares as at the Latest Practicable Date.(2) As at the Latest Practicable Date, Michael Mun Hong Yew’s aggregate interest consists of 115,105,663 Shares which he holds directly, 1,200,000 Sharesheld by OCBC Securities Pte Ltd and 3,636,000 Shares held by AVS Technologies Pte Ltd.

118a z t e c h a n n u a l r e p o r t 2 0 0 9F i n a n c i a l S t a t e m e n t sNOTICE OF ANNUAL GENERAL MEETINGAs at the Latest Practicable Date, none of our Directors or Substantial Shareholders will be obliged to make a mandatory take-over offer inthe event that the Company purchased the maximum 10% of the issued Shares under the proposed Share Buy Back Mandate. In this regard,our Substantial Shareholder, Michael Mun Hong Yew, who is presumed to have an interest in 119,941,663 Shares, is regarded as acting inconcert with (i) his son Jeremy Mun Weng Hung who holds 1,044,000 Shares; (ii) his son Ivan Mun Weng Kai who holds 60,000 Shares (iii) hisbrother Mun Hon Pheng who indirectly holds 3,503,000 Shares and (iv) his brother Mun Hoon Wing who holds 724,000 Shares as at the LatestPracticable Date, pursuant to the Take-over Code.Shareholders who are in doubt as to whether they would incur any obligation to make a take-over offer as a result of any purchase of Shares bythe Company pursuant to the Share Buy Back Mandate are advised to consult their professional advisers and/or the Securities Industry Councilbefore they acquire any Shares in the Company during the period when the Share Buy Back Mandate is in force.The statements herein do not purport to be a comprehensive or exhaustive description of all implications that may arise underthe Take-over Code. Shareholders are advised to consult their professional advisers and/or the Securities Industry Council and/orother relevant authorities at the earliest opportunity as to whether an obligation to make a take-over offer would arise by reasonof any purchase or acquisition of Shares by the Company.J. SHARES PURCHASED IN THE PREVIOUS 12 MONTHSNo purchases of Shares have been made by the Company in the 12 months preceding the date of this Notice.K. RECOMMENDATIONThe Directors are of the opinion that the proposed Share Buy Back Mandate for the Buy Back by the Company of its Shares is in the best interestsof the Company. They accordingly recommend that Shareholders vote in favour of the Resolution, being the ordinary resolution number 10relating to the Share Buy Back Mandate set out on page 107 of this Annual Report.L. DIRECTORS’ RESPONSIBILITY STATEMENTThe Directors collectively and individually accept responsibility for the accuracy of the information given in this Explanatory Statement and confirm,having made all reasonable enquires, that to the best of their knowledge and belief, the facts stated and opinion expressed in this ExplanatoryStatement are fair and accurate and that there are no material facts the omission of which would make any statement in this ExplanatoryStatement misleading.

F i n a n c i a l S t a t e m e n t sAZTECH GROUP LTDPROXY FORM FOR ANNUAL GENERAL MEETINGNo. of Shares heldI/We ______________________________________________________________________________________________________of ________________________________________________________________________________________________________being a Member(s) of Aztech Group Ltd, hereby appoint Mr/Mrs/MsName Address NRIC/PASSPORT NO. Proportion of Shareholdings (%)or failing him/her, the Chairman of the Annual General Meeting (“AGM”) of the Company as my/our proxy, to vote for me/us and on my/our behalf and ifnecessary, to demand a poll, at the AGM of the Company, to be held at 31 Ubi Road 1, Aztech Building, Singapore 408694 on Friday, April 9 2010, andat any adjournment thereof in the following manner:-RESOLUTIONS FOR AGAINST1. To adopt the Audited Accounts, Director’s Report and Auditors’ Report2. Declaration of final one-tier tax exempt dividend of $0.0125 per share3. To approve the payment of Directors’ Fees for FY 20104. To re-elect Mr Khoo Ho Tong as a Director under Article 1075. To re-elect Mr Martin Chia Heok Miin as a Director under Article 1076. To re-appoint Auditors and authorise Directors to fix their remuneration7. To authorise Directors to issue Shares pursuant to Section 161 of the CompaniesAct, Chapter. 508. To authorise Directors to issue Shares and/or Instruments at a discount not exceeding20%9. To authorise Directors to allot and issue shares in connection with the exercise ofoptions granted pursuant to the Aztech Group Employees’ Share Option Scheme200010. To renew Share Buy Back MandateIf you wish to exercise all your votes For or Against, please tick with “ √ “. Alternatively, please indicate the number of votes For or Against eachresolution.If this form of proxy contains no indication as to how the proxy should vote in relation to each resolution, the proxy shall, as in the case of any otherbusiness raised at the meeting, vote as the proxy deems fit.As witness my/our hand(s) this ____________________ day of ____________________ 2010.____________________Signature of ShareholderORThe Common Seal of the company was hereunto affixed in the presence of :-____________________Director____________________Director/SecretaryIMPORTANT:This Annual Report is forwarded to CPF Investors at the request of their CPF Approved Nominees and is sent solely FOR INFORMATION.This Proxy Form is not valid for use by CPF Investors and shall be ineffective for all intents and purposes if used or purported to be used by them.

AZTECH GROUP LTDPROXY FORM FOR ANNUAL GENERAL MEETINGNotes:1. Please insert the total number of shares held by you. If you have shares entered against your name in the Depository Register (as defined in Section 130A ofthe Companies Act, Chapter 50), you should insert that number of shares. If you have shares registered in your name in the Register of Members, you shouldinsert that number of shares. If you have shares entered against your name in the Depository Register and shares registered in your name in the Registerof Members, you should insert the aggregate number of shares entered against your name in the Depository Register and registered in your name in theRegister of Members. If no number is inserted, the instrument appointing a proxy or proxies shall be deemed to relate to all the shares held by you.2. A member entitled to attend and vote at a meeting of the Company is entitled to appoint not more than two proxies to attend and vote instead of him.3. Where a member appoints two proxies, he shall specify the percentage of his shares to be represented by each proxy and if no percentage is specified, thefirst named proxy shall be deemed to represent 100 per cent of his shareholding and the second named proxy shall be deemed to be an alternate to the firstnamed.4. A proxy need not be a member of the Company.5. The instrument appointing a proxy or proxies together with the letter or power of attorney, if any, under which it is signed or a duly certified copy thereof,must be deposited at the registered office of the Company at 31 Ubi Road 1, Aztech Building, Singapore 408694, not less than 48 hours before the timeappointed for the Annual General Meeting.6. The instrument appointing a proxy or proxies must be under the hand of the appointor or his attorney duly authorised in writing. Where the instrumentappointing a proxy or proxies is executed by a corporation, it must be executed either under its seal or under the hand of an officer or attorney dulyauthorised.7. A corporation which is a member may authorise by resolution of its directors or other governing body such person as it thinks fit as its representative at theAnnual General Meeting, in accordance with Section 179 of the Companies Act, Chapter 50.8. Please indicate with an “ √ ” in the spaces provided whether you wish your vote(s) to be for or against the Resolutions as set out in the Notice of AnnualGeneral Meeting. In the absence of specific directions, the proxy/proxies will vote or abstain as he/they may think fit, as he/they will on any other matterarising at the Annual General Meeting.9. The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible or where the trueintentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing a proxy or proxies.10. In the case of a member whose shares are entered against his name in the Depository Register, the Company may reject any instrument appointing a proxyor proxies lodged if the member, being the appointor, is not shown to have shares entered against his name in the Depository Register as at 48 hours beforethe time appointed for holding the Annual General Meeting, as certified by The Central Depository (Pte) Limited to the Company.

HEAD OFFICEAZTECH GROUP LTD31 Ubi Road 1, Aztech BuildingSingapore 408694Tel: (65) 6594-2288Fax: (65) 6749-1198Website: www.aztech-group.comOVERSEA OFFICESHONG KONGAztech Systems (H.K.) LimitedRoom 2-6, 3/F, Core Building 1No 1 Science Park East AvenueHong Kong Science ParkShatin, New TerritoriesHong KongTel: (852) 2757 1177Fax: (852) 2753 0578USAAZTECH LABS, INC.4005 Clipper CourtFremont, CA 94538USATel: (1) (510) 683-9800Fax: (1) (510) 683-9803GERMANYAZTECH SYSTEMS GmBHKreuzberger Ring 2265205 WiesbadenGermanyTel: (49) (0) 611-45020-0Fax: (49) (0) 611-45020-100MALAYSIAAZ-TECHNOLOGY SDN BHD901, Level 9, Block BKelana Business Centre97, Jalan SS7/2 Kelana Jaya47301 Petaling JayaSelangor MalaysiaTel: (60) (3) 7804-8450Fax: (60) (3) 7804-8457R&D CENTRESHQ R&D CENTRE31 Ubi Road 1, Aztech BuildingSingapore 408694Tel: (65) 6594-2288Fax: (65) 6749-1198SHENZHEN R&D CENTRENo. A 20/F, Times Fortune BuildingNo. 88 Fuhua Road 3,CBD ShenzhenChina 518026Tel: (86) (755) 25-33-1110Fax: (86) (755) 2533-1117HONG KONG R&D CENTRERoom 2-6, 3/F, Core Building 1No 1 Science Park East AvenueHong Kong Science ParkShatin, New TerritoriesHong KongTel: (852) 2757 1177Fax: (852) 2753 0578DONG GUAN R&D CENTREJiu Jiang Shui Village, Chang Ping TownDong Guan City, Guang Dong ProvinceChinaTel: (86) (769) 8393-6688Fax: (86) (769) 8393-1138MANUFACTURING FACILITIESCHINAAZTECH COMMUNICATION DEVICE (DG) LTDJiu Jiang Shui Village, Chang Ping TownDong Guan City, Guang Dong ProvinceChinaTel: (86) (769) 8393-6688Fax: (86) (769) 8393-1138SUBSIDIARY – DISTRIBUTIONSHIRO CORPORATION PTE. LTD.31 Ubi Road 1, #08-00Aztech BuildingSingapore 408694Tel: (65) 6594 -2233Fax: (65) 6749 -3083Website: www.shirocorp.comwww.shirofb.comSHIRO CORPORATION (HK) LIMITEDRoom 2-6, 3/F, Core Building 1No 1 Science Park East AvenueHong Kong Science ParkShatin, New TerritoriesHong KongTel: (852) 2757 1177Fax: (852) 2753 0578SUBSIDIARY – SUPPLY OF MATERIALSAZ UNITED PTE. LTD.31 Ubi Road 1, Aztech BuildingSingapore 408694Tel: (65) 6594-2288Fax: (65) 6741-9773SUBSIDIARY – MARINE LOGISTICSAZ MARINE PTE. LTD.31 Ubi Road 1, Aztech BuildingSingapore 408694Tel: (65) 6594-2298Fax: (65) 6741-9773SUBSIDIARY – LED LIGHTINGAZ E-LITE PTE. LTD.31 Ubi Road 1, Aztech BuildingSingapore 408694Tel: (65) 6594-2288Fax: (65) 6741-9773