5 3922 fax: 455 7322 re lane singapore 787480

ore Lane Singapore 787480

5 3922 Fax: 455 7322

Strike Engineering Limited • Annual Report 2001 annual report 2001

Brought to you by Global Reports

The sky symbolises the Group’s

relentless quest towards quality and

excellence in all its endeavours.

The flash of light in the sky

represents the Group as a shining

paradigm of integrity and reliability

for all to aspire towards.

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The latest acquisition of Gordon (HK) Designer & Engi

Limited (“Gordon”) was the result of the Group’s consis

strategy in enhancing its short term and long term profitab

This acquisition further strengthens the Group’s positio

as a diversified organisation, while moving away from

traditional M&E business.


Managing Director’s Statement

Financial Highlights

Corporate Milestones

Corporate Structure

Corporate Information

Directors’ Report

Statement by Directors

Auditors’ Report

Balance Sheets

Statements of Profit and Loss

Statements of Changes in Equity

Consolidated Statement of Cash Flows

Notes to the Financial Statements

Group Properties

Corporate Governance

Statistics of Shareholders

Statistics of Warrantholders

Notice of Annual General Meeting

Proxy Form


The traditional M&E business was inevitably affected by the prolonged weak performanc

of the construction sector. However, the overall performance of the various subsidiarie

under the Group had produced a moderate result.

CABLING INFRASTRUCTURELantrovision (S) Ltd is a structured cabling specialist offering turnkey solutions for buildin

cabling infrastructure. We are pleased to announce that the profit guarantees for the fisca

years ended 30 June 2000 and 30 June 2001 were met.

Its turnover in fiscal year 2002 is projected to increase to over and above that of fisca

year 2001.

The optimistic outlook against a weak economic background is due to the favourabl

demand for its specialised service. In addition, other contributing factors include

a) the increasing demand for internet services, technological advancements and networkin

services, which calls for constant upgrades to companies’ computer systems, givin

rise to an increased need for the Group’s services;

b) global mergers of banks and MNCs which resulted in these companies streamlinin

their operations and relocating their offices, thereby increasing the demand for th

Group’s services;

c) the continued growth and expansion of its current market share in countries wher

subsidiaries have been set up recently, e.g. Japan, Korea and Hangzhou, through trad

promotions, advertisements and recommendations from existing customers; an

d) maintenance contracts secured arising from completed installation projects i

previous periods.

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per cent rise in public sector works across all segments, excluding residential projects.

Reflecting the poor construction demand, total contracts awarded fell 64 per cent in the

second quarter of this year, which accounted for a further weakening of the 18 per cent

contraction in the first quarter.

In general, the construction sector mirrors the developments in the property sector. Hence,

following the lacklustre performance of the property market, we can expect the construction

sector to remain weak in FY2001 and FY2002.

NEW ACQUISITIONSIn February 2001, the Group successfully acquired a 51% equity interest in Gordon (HK)

Designer & Engineer Limited (“Gordon”). Incorporated in Hong Kong, Gordon’s core

business is in interior architecture, design and decoration services in the People's Republic

of China (PRC) and Hong Kong. The Company also holds a permit to undertake projects

of unlimited contract value.

In light of the Group’s overseas expansion strategy, this acquisition presented an opportunity

for the Group to gain a foothold in the PRC and Hong Kong markets. Gordon has established

its network in the PRC and Hong Kong which serves as a platform for the Group to venture

into these markets. This allows the Group to diversify and to weather through during leaner

times of the economic downturn.

APPRECIATIONOn behalf of our board members, I would like to express our appreciation to all our employees

who have remained committed in achieving the goals of the Group and in contributing to

the Group’s success. I would also like to extend my appreciation to our clients, shareholders

and business partners for their continuous support.

Yeo Jiew Yew

Managing Director


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Date Events

4 August 1999 The Company was admitted to the Official List of Stock Exchang

Singapore Dealing and Automated Quotation System (“SGX-Se

20 December 1999 The Company made a bonus issue of 1 new ordinary share cred

fully paid for every 2 existing ordinary shares held in the Compa

5:00 pm on 16 December 1999 by capitalising a maximum of $5

and $112,500 from the share premium account and accumulate

of the Company respectively.

22 December 1999 The new ordinary shares issued pursuant to the bonus issue we

on SGX-Sesdaq.

13 December 2000 The Company made a bonus issue of 1 new ordinary share cred

fully paid for every 1 existing ordinary share held in the Compan

5:00 pm on 8 December 2000 by capitalising a sum of $18,272,

$52,600 from the share premium account and accumulated prof

Company respectively.

14 December 2000 The new ordinary shares issued pursuant to the bonus issue we

on SGX-Sesdaq.

6 April 2001 The Company issued 183,246,000 warrants expiring in April 200

carrying the right to subscribe for new ordinary shares in the cap

Company at an issue price of $0.022 for each warrant on the ba

warrant for every 4 existing ordinary shares held in the Compan

5:00 pm on 13 March 2001, in conjunction with a transferable lo

in the principal amount of $12 million.

11 April 2001 The issued 183,246,000 warrants expiring in April 2006 were lis

SGX-Sesdaq.

corporate milestones

Turnover by Business Activities

Electrical Engineering Services 15,148 25,349

Building, Mechanical Engineering Services and others 9,131 10,087

Information Technology Cabling 60,451 9,571

Interior Architectures & Design 6,470 -

Networking 639 -

Strike Construction

Pte Ltd61.2%

GredanianPte Ltd

70%

Lantrovision(S) Ltd50.46%

Nete2 AsiaPte Ltd

51%

Gordon (HK)Designer &EngineerLimited

51%

ei-Nets Ltd17.45%

StrikeDevelopment

Pte Ltd51%

VRnet (S)Pte Ltd

55%

Lantro (HK)Limited

100%

Lantro(Japan) Ltd

100%

Lantro (Malaysia) Sdn. Bhd.

100%

Lantro (Penang) Sdn. Bhd.

51%

Lantro Phils. Inc.

40%

Lantro (Thailand) Co., Ltd

49%

Lantro Korea Co., Ltd

70%

Lantro Co. Ltd(Hangzhou)

70%

Spectrum InfocomInternational

Pte Ltd60%

Speed ei-NetsPte Ltd

100%

CanEi-Nets.comPte Limited

80%

VRnet (ThailCo., Ltd

49%

90%

SuntzeCommunicat

EngineerinPte Ltd74.44%

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orat

e Mr Then Khek Koon

Mr Lew Syn Pau (Independent Director)

Mr Tan Kim Chew (Independent Director)

Dr Cham Tao Soon

Mr Lew Syn Pau (Chairman)

Mr Chua Koh Ming

Mr Tan Kim Chew

22 Tagore Lane

Singapore 787480

Tel : 455 3922

Fax : 455 7322

Lim Associates (Pte) Ltd

10 Collyer Quay #19-08

Ocean Building

Singapore 049315

United Overseas Bank Limited

80 Raffles Place, #12-00

UOB Plaza 1

Singapore 048624

Southern Bank Berhad

Singapore Branch

39 Robinson Road #01-02

Robinson Point

Singapore 068911

RHB Bank Berhad

90 Cecil Street #03-00

Singapore 069531

Malayan Banking Berhad

50 Raffles Place, 9th Floor

Singapore Land Tower

Singapore 048623

Arthur Andersen

Certified Public Accountants

10 Hoe Chiang Road

#18-00 Keppel Towers

Singapore 089315

Partner-In-Charge:

Mr Max Loh Khum Whai

Wong Siew Chuan, CPA

Business AdvisorBusiness Advisor

Audit CommitteeAudit Committee

AuditorsAuditors

Company SecretaryCompany Secretary

Registered OfficeRegistered Office

Registrar and Share Transfer OfficeRegistrar and Share Transfer Office

Principal BankersPrincipal Bankers

Then Khek KoonLew Syn PauTan Kim Chew

Principal Activities

The Company, incorporated in Singapore, is a company listed on the Singapore Exchange Securities Trading(“Singapore Exchange”).

The principal activities of the Company are those of provision of mechanical and electrical engineering servdealing in electrical products.

During the year, following the acquisition of certain subsidiaries, the principal activities of the Group have design, installation and provision of network integration services and structured cabling, interior architectureand decoration services and that of property development. The principal activities of the subsidiaries are discNote 7 to the financial statements.

Apart from the above, there have been no significant changes in the nature of the activities of the Compansubsidiaries during the financial year.

Employees

The total number of employees in the Company and the Group at the end of the financial year was 169 anrespectively (2000: 262 and 514).

Results for the Financial Year

Group Comp

$ $

Loss for the year (4,483,055) (7,008Accumulated profits brought forward 7,248,935 6,929Bonus issue of shares (52,574) (52

2,713,306 (131

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Acquired by the Company

Nete2 Asia Pte Ltd Singapore 51 51,000

Gordon (HK) Designer andEngineer Ltd Hong Kong 51 9,358,635 4

9,409,635 4

Acquired by a subsidiary

Strike Coal and Mineral Pte Ltd Singapore 100 2

VRnet (S) Pte Ltd and its subsidiary Singapore 55 110,000

110,002

(b) During the financial year, a subsidiary increased its shareholding in its subsidiary, Lantro (HK) Limited, by 30

Interest Interest after Purchase Neacquired acquisition Consideration asse

% % $

Lantro (HK) Limited 30 100 315,751 1

(c) The following subsidiary was disposed of during the financial year:

NeInterest Interest after a

disposed of disposal Proceeds dis

% % $

Lantro Phils. Inc. 30 40 33,459

Other than as disclosed above, there were no acquisitions or disposals of subsidiaries during the financia

During the financial year:

(i) Gredanian Pte Ltd, a subsidiary, increased its authorised share capital from $100,000 to $1,000,000 via theof 900,000 ordinary shares of $1 each. In addition, 900,000 ordinary shares of $1 each were issued at paof capitalisation of balances owing to its director and holding company to provide working capital;

(ii) Strike Construction Pte Ltd, a subsidiary, was incorporated with an authorised share capital of 100,000 shares of $1 each. At the date of incorporation, two subscribers’ shares were issued at par for cash to its subSubsequently, its authorised share capital was increased to $1,000,000 via the creation of 900,000 ordinarof $1 each and 424,998 ordinary shares of $1 each were issued at par for cash to provide additional workin

(iii) A subsidiary, Lantro Korea Co. Ltd was incorporated in Korea with a registered and paid-in capital of WON90,

(iv) A subsidiary, Lantro Co. Ltd (Hangzhou) was incorporated in the People’s Republic of China with a registpaid-in capital of US$100,000; and

(v) Lantrovision (S) Ltd (formerly known as Lantrovision (S) Pte Ltd), a subsidiary issued 8,000 ordinary s$1 each at $13.75 per share as consideration for the acquisition of a 55% equity interest in a subsidiary.

No other shares or debentures were issued by the Company and its subsidiaries during the financial year.

Arrangements to Enable Directors to Acquire Shares or Debentures

Except for the warrants issued during the financial year, neither at the end of nor at any time during the finanwas the Company a party to any arrangement whose object was to enable the directors of the Company tobenefits by means of the acquisition of shares or debentures of the Company or any other body corporate.

Directors’ Interest in Shares and Debentures

The interests of the directors holding office at the end of the financial year in the shares and debentures of the Cand related corporations were as follows:

Other shareholdings / warranthold which the directors are deem

Held by director as at to have an interest as at

1 July 30 June 21 July 1 July 30 June 212000 2001 2001 2000 2001 2

The Company

Strike Engineering LimitedOrdinary shares of $0.05 each

Yeo Jiew Yew 56,100,000 112,200,000 112,200,000 - -Chua Koh Ming 40,800,000 61,000,000 64,336,000 - 8,600,000 6Umar Abdul Hamid - 91,108 91,108 51,000,000 88,167,000 88,1Lew Syn Pau - - - - 1,198,568 1,1Lim Soon Hock - - - 10,291,000 4,000Lum Chue Tat 12,956,000 22,712,000 22,712,000 348,000 3,896,000 3,8Then Khek Koon 1,028,000 - - 16,109,000 11,330,000 12,0

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t Yeo Jiew Yew - 28,050,000 28,050,000 - -Umar Abdul Hamid - 22,777 22,777 - 16,175,000Lew Syn Pau - - - - 299,642Lim Soon Hock - - - - 1,000Lum Chue Tat - 5,678,000 5,678,000 - 974,000Then Khek Koon - - - - 2,001,000

Subsidiary

Lantrovision (S) Pte LtdOrdinary shares of $1 each

Lum Chue Tat 122,500 122,500 122,500 - -

No other directors of the Company had an interest in any shares or debentures of the Company or related either at the beginning or end of the financial year and on 21 July 2001.

Directors’ Contractual Benefits

Since the end of the previous financial year, no director has received or become entitled to receive a benefa benefit or any fixed salary of a full-time employee of the Company included in the aggregate amount of shown in the financial statements, or any emoluments received from a related corporation) by reason of a coby the Company or a related corporation with the director or with a firm of which the director is a membcompany in which the director has a substantial financial interest.

Dividends

No dividends have been paid, declared or recommended since the end of the Company’s previous financ

Bad and Doubtful Debts

Before the financial statements of the Company were prepared, the directors took reasonable steps to aproper action had been taken in relation to writing off bad debts and providing for doubtful debts of the Cosatisfied themselves that all known bad debts had been written off and that adequate provision had bedoubtful debts.

At the date of this report, the directors are not aware of any circumstances which would render the amount written off or the amount of provision for doubtful debts in the consolidated financial statements inadeqsubstantial extent.

At the date of this report, no charge on the assets of the Company or any other corporation in the Group whichthe liabilities of any other person has arisen since the end of the financial year and no contingent liability of the Cor any other corporation in the Group has arisen since the end of the financial year.

Ability to Meet Obligations

No contingent or other liability has become enforceable or is likely to become enforceable within the period omonths after the end of the financial year which, in the opinion of the directors, will or may substantially affect tof the Company and of the Group to meet their obligations as and when they fall due.

Other Circumstances Affecting the Financial Statements

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

Unusual Items

In the opinion of the directors, the results of the operations of the Company and of the Group for the financial ynot been substantially affected by any item, transaction or event of a material and unusual nature.

Unusual Items After the Financial Year

In the opinion of the directors, except for the subsequent events disclosed in Note 35 to the financial statemitem, transaction or event of a material and unusual nature has arisen in the interval between the end of the year and the date of this report which would affect substantially the results of the operations of the Companthe Group for the financial year in which this report is made.

Share Options or Warrants

During the financial year, 183,246,000 warrants were issued, with one warrant being issued for every four shares of $0.05 each held in the capital of the Company. Each warrant entitles the warrant holder to subscribnew ordinary share at the exercise price of $0.11 during the Exercise Period. The Exercise Period refers to thduring which the warrants may be exercised, commencing after the listing and quotation of the warrants on tSESDAQ for a period not exceeding 5 years from the date of issue of the warrants, 6 April 2001. From the dateto 30 June 2001, 16,000 warrants have been exercised by the warrant holders. The number of warrants outat the end of the financial year was 183,230,000.

Except for the above, no other options to take up unissued shares of the Company or its subsidiaries were grano other shares were issued by virtue of the exercise of options to take up unissued shares of the Compansubsidiary. There were no unissued shares of the Company or any subsidiary under option at the end of the finan

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The Audit Committee carried out its functions in accordance with the Companies Act, Cap. 50 and the SingaporSecurities Trading Limited Listing Manual. In performing those functions, the Audit Committee inter alia revie

(a) the overall scope of external audits and the assistance provided by the Group’s officers to the audito

(b) the auditors’ evaluation of the system of internal accounting controls arising from their audit;

(c) interested party transactions for the financial year ended 30 June 2001 in accordance with ChaptSingapore Exchange Securities Listing Manual to satisfy themselves that the transactions are on normaterms; and

(d) the financial statements of the Company and the consolidated financial statements of the Group for year ended 30 June 2001 before their submission to the Board of Directors and the auditors’ repfinancial statements.

The Audit Committee held 2 meetings during the financial year.

The Audit Committee recommends to the Board of Directors the nomination of Arthur Andersen for re-appauditors at the forthcoming annual general meeting of the Company.

Other information required by the Singapore Exchange Securities Trading Limite

No material contracts to which the Company or any subsidiary is a party and which involve directors’ interesat, or have been entered into since the end of the previous financial year.

Auditors

Arthur Andersen have expressed their willingness to accept re-appointment.

On behalf of the Board of Directors

YEO JIEW YEW UMAR ABDUL HAMIDDirector Director

Singapore5 October 2001

YEO JIEW YEW UMAR ABDUL HAMIDDirector Director


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ort (a) the financial statements and consolidated financial statements are properly drawn up in accordan

provisions of the Companies Act and Statements of Accounting Standard in Singapore and so as toand fair view of:

(i) the state of affairs of the Company and of the Group as at 30 June 2001 and of the results andequity of the Company and of the Group and cash flows of the Group for the year then ended; an

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

(b) the accounting and other records and the registers required by the Act to be kept by the Company and itsincorporated in Singapore have been properly kept in accordance with the provisions of the Act.

We have considered the financial statements and auditors’ reports of all subsidiaries of which we have auditors and the financial statements of those subsidiaries which are not required to present audited financiaby the laws of their country of incorporation, being financial statements included in the consolidated financiaThe names of these subsidiaries are disclosed in Note 7 to the financial statements.

We are satisfied that the financial statements of the subsidiaries that have been consolidated with the financiaof the Company are in form and content appropriate and proper for the purposes of the preparation of the cfinancial statements and we have received satisfactory information and explanations as required by us for thos

The auditors’ reports on the financial statements of the subsidiaries were not subject to any qualification anof the subsidiaries incorporated in Singapore, did not include any comment made under Section 207(3) of

Arthur AndersenCertified Public Accountants


Fixed assets 5 17,947,251 16,872,945 8,039,561 10,5Investment property 6 777,336 - -Investment in subsidiaries 7 - - 29,113,361 19,0Associated companies 8 236,580 3,363,707 - 9,0Goodwill on consolidation 9 14,408,568 15,887,952 -Other investments 10 2,880,000 - 2,880,000Preliminary expenses 26,123 19,156 -

Current assetsDevelopment properties 11 43,235,988 13,075,891 -Stocks 12 2,677,092 4,124,632 128,335 2Projects-in-progress 13 15,285,659 13,635,681 8,706,572 10,2Trade debtors 14 21,437,959 14,728,429 157,914 6Other debtors, deposits and prepayments 15 1,178,669 3,900,971 94,934 1Due from subsidiaries (trade) - - 2,321,149 2,0Due from subsidiaries (non-trade) 16 - - 15,073,407 7,0Due from associated companies (trade) - 554,717 -Due from associated companies (non-trade) 16 - 39,608 1,618Due from affiliated companies (trade) 310,735 - -Due from affiliated companies (non-trade) 16 191,023 - 6,932Quoted investments 17 18,005 25,005 -Fixed deposits 18 1,562,680 4,278,364 - 3,0Cash and bank balances 12,946,098 3,614,723 263,946

98,843,908 57,978,021 26,754,807 23,4

Current liabilitiesTrade creditors 13,726,132 11,332,985 2,791,144 1,3Progress billings in excess of costs 19 1,215,548 873,185 831,801 6Other creditors and accruals 20 8,602,511 1,043,828 6,008,347 2Due to directors 16 704,067 4,819,681 - 2,9Provision for taxation 4,520,167 4,835,165 1,121,408 2,3Short term bank loans, unsecured 21 3,000,000 2,000,000 3,000,000 2,0Short term bank loans, secured 22 9,700,000 8,750,000 -Lease obligations, current portion 23 312,641 136,571 38,100Bank term loans, current portion (secured) 24 7,081,784 1,128,918 343,776 1,0Bills payable to banks, unsecured 167,880 1,392,058 167,880 1,3Bank overdrafts, unsecured 1,852,936 1,893,334 1,852,936 1,8

50,883,666 38,205,725 16,155,392 13,9

Net current assets 47,960,242 19,772,296 10,599,415 9,5

Non-current liabilitiesLease obligations, non-current portion 23 906,856 314,324 59,803Bank term loans, non-current portion (secured) 24 25,039,568 6,179,522 10,216,224 4,4Deferred tax 56,049 109,480 32,800

58,233,627 49,312,730 40,323,510 43,5

The accompanying notes are an integral part of the financial statements.

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Other operating expenses (2,618,547) (808,156) (93,203)

Profit (loss) from operations 27 9,570,271 6,548,139 (543,545)Financial expenses – net 29 (516,865) (70,005) (344,708)Exceptional item 30 (6,120,000) - (6,120,000)

2,933,406 6,478,134 (7,008,253)

Share of results of associated companies 124,209 (194,873) -

Profit (loss) before tax 3,057,615 6,283,261 (7,008,253)Tax 31 (3,372,670) (1,827,893) - (

(Loss) profit after tax (315,055) 4,455,368 (7,008,253)Minority interests (4,168,000) (598,636) -

(Loss) profit attributable to shareholders (4,483,055) 3,856,732 (7,008,253)

Accumulated profits, brought forward 7,248,935 7,093,206 6,929,580

Profit (loss) available for appropriation 2,765,880 10,949,938 (78,673) 1Issue of bonus shares

via capitalisation of accumulated profits (52,574) (3,701,003) (52,574) (

Accumulated profits (loss),carried forward 2,713,306 7,248,935 (131,247)

(Loss) earnings per share (cents) 32- Basic (0.61) 0.60 - Diluted (0.61) 0.60


5,340,000 ordinary shares of $1 each via capitalisationof accumulated profits and share premium 5,340,000 (1,751,497) - - (3,588,503)

Issue of 42,500,000 ordinary shares of $0.05 each at a premium of $0.14 per share for cash pursuant to the Company’s Initial Public Offer (“IPO”) 2,125,000 5,950,000 - - - 8,0

Bonus issue of 106,250,000 ordinary sharesof $0.05 each via capitalisation of accumulated profits and share premium 5,312,500 (5,200,000) - - (112,500)

Issue of 47,742,000ordinary shares of $0.05 each at a premium of $0.382 per share as consideration for the purchase of a subsidiary and an associated company 2,387,100 18,237,900 - - - 20,6

Expenses in connection with the IPO - (715,874) - - - (7

Balance at 30 June 2000 18,324,600 18,272,026 520,114 1,142 7,248,935 44,3

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- - - - - (4,483,055)Bonus issue of

366,492,000 ordinary shares of $0.05 each via capitalisation of accumulated profits and share premium 18,324,600 (18,272,026) - - - (52,574)

Renounceable rights issue of 183,246,000 warrants 2006 at $0.022 each for cash - - 4,031,412 - - -

Issue of 16,000 ordinary shares of $0.05 each upon exercise of warrants 2006 at $0.11 per share 800 1,312 (352) - - -

Expenses in connection with the warrants issue - - (227,615) - - -

Balance at 30 June 2001 36,650,000 1,312 3,803,445 520,114 516,078 2,713,306

each at a premium of $0.14 per share for cash pursuant to Company’s IPO 2,125,000 5,950,000 - - 8,0

Bonus issue of 106,250,000 ordinary shares of $0.05 each via capitalisation of accumulated profits and share premium 5,312,500 (5,200,000) - (112,500)

Issue of 47,742,000 ordinary shares of $0.05 each at a premium of $0.382 per share as consideration for the purchase of a subsidiary and an associated company 2,387,100 18,237,900 - - 20,6

Expenses in connection with IPO - (715,874) - - (7

Balance at 30 June 2000 18,324,600 18,272,026 - 6,929,580 43,5

Net loss - - - (7,008,253) (7,0

Bonus issue of 366,492,000 ordinary shares of $0.05 each via capitalisation of accumulated profits and share premium 18,324,600 (18,272,026) - (52,574)

Renounceable rights issue of 183,246,000 warrants 2006 at $0.022 each for cash - - 4,031,412 - 4,0

Issue of 16,000 ordinary shares of $0.05 each upon exercise of warrants 2006 at $0.11 per share 800 1,312 (352) -

Expenses in connection with the warrants issue - - (227,615) - (2

Balance at 30 June 2001 36,650,000 1,312 3,803,445 (131,247) 40,3


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Provision for doubtful trade debts 908,371 Provision for foreseeable project losses 9,883 Provision for lower of cost and market value

of quoted and other investments 6,127,000 Share of results of associated companies (124,209)Write back of provision for doubtful trade debts (160,753)Interest expense 504,320 Interest income (103,403)Translation adjustment 366,445

Operating profit before working capital changes 12,858,351 (Increase) decrease in:

Preliminary expenses (31,176)Development properties (30,160,097) (1Stocks 1,447,540 (Projects-in-progress, net of progress billings (1,317,498)Trade debtors (183,734)Other debtors, deposits and prepayments 2,908,188 (

Increase (decrease) in:Trade creditors 1,340,773 (Other creditors and accruals 6,745,128 Intercompany balances, net 679,309 Due to directors (3,439,290)Bills payable to bank (1,224,178)

Cash used in operations (10,376,684) (Interest income received 103,403 Interest paid (504,320)Income taxes paid (4,281,553) (

Net cash used in operating activities (15,059,154) (

Cash flow from investing activitiesProceeds from sale of fixed assets 2,683,870 Purchase of fixed assets B (2,012,323) (Net proceeds from disposal of associated company 40,220 Acquisition of associated company - (Net cash flow from acquisition of subsidiaries C (8,551,868)

Net cash used in investing activities (7,840,101) (

Cash flow from financing activitiesProceeds from term loans 32,510,000 1Net proceeds from issue of shares, net of expenses 2,112 Net proceeds from issue of warrants, net of expenses 3,803,445 Contributions from minority shareholders of subsidiaries 435,000 Repayment of hire purchase liabilities (327,910)Repayment of term loans (6,867,303) (

Net cash generated from financing activities 29,555,344 2

Net increase in cash and cash equivalents 6,656,089 Cash and cash equivalents at beginning of year 5,999,753

Cash and cash equivalents at end of year A 12,655,842

B. Fixed assets

During the financial year, the Group acquired fixed assets with an aggregate cost of $3,108,834 (2000: $7,of which $1,096,511 (2000: $367,821) was acquired by means of finance leases. Cash payments of $2(2000: $7,598,114) were made to purchase fixed assets.

C. Acquisition of subsidiaries

The attributable net assets of subsidiaries acquired during the year are as follows:

Fixed assets and investment property 2,207,658 3,39Associated company - 7Cash and bank balances 1,165,387 2,93Trade debtors 7,340,620 13,34Stocks - 1,45Other debtors, deposits and prepayments 185,889 26Quoted investments - Trade creditors (1,052,375) (6,70Other creditors and accruals (431,320) (42Provision for taxation (540,454) (1,25Intercompany balances, net 586,742 2Due to directors, net 676,324 (1,67Term loans (1,120,214) (1,75Hire purchase liabilities - (17Deferred taxation - (6Minority interests - (27Reserve on consolidation - (1,40

Net assets acquired 9,018,257 7,97Add goodwill on consolidation 4,967,210 12,12Minority interests (4,268,212) (3,88

Total purchase consideration 9,717,255 16,20Less purchase consideration satisfied via share issue - (15,62

Purchase consideration satisfied via cash 9,717,255 58Less: cash and bank balances of subsidiaries (Note 1) (1,165,387) (2,93

Net cash flow from acquisition of subsidiaries (8,551,868) (2,35

Note 1:Represented by cash and cash equivalents assumed:Cash and bank balances 1,165,387 2,05Fixed deposits - 93Bank overdrafts - (5

1,165,387 2,93


p p

2. SIGNIFICANT ACCOUNTING POLICIES

Basis of preparation

The financial statements, which are expressed in Singapore dollars, are prepared in accordance withof Accounting Standard in Singapore and under the historical cost convention, modified by the refreehold land and building.

Basis of consolidation

The consolidated financial statements include the financial statements of the Company and its subsresults of subsidiaries acquired or sold during the year are consolidated for the periods from or toacquisition or disposal. All intercompany balances and any unrealised profit or loss on intercompany are eliminated on consolidation.

Investments in associated companies are accounted for in the consolidated financial statements usinmethod. The financial statements of foreign associated companies are translated into Singapore doof exchange ruling at the balance sheet date. Any unrealised profit or loss arising from transactions witcompanies is eliminated to the extent of the portion attributable to the Group.

When subsidiaries or associated companies are acquired, any difference between the consideration fair values of the net assets acquired is amortised to the consolidated profit and loss account in equaover the period of 5 to 10 years.

The results of foreign subsidiaries are translated into Singapore dollars at the average exchange ratesand balance sheet items are translated at exchange rates ruling at the balance sheet date. Exchangearising on translating the opening net assets are taken directly to translation reserve until the disposal of th

Subsidiaries and associated companies

Investments in subsidiaries and associated companies are stated in the financial statements of the cost. Provision is made where there is a decline in value that is other than temporary.

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

An associated company is a company, not being a subsidiary, in which the Group has an interest of n20% of the equity and in whose financial and operating policy decisions the Group exercises significa

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Machinery, tools and equipment 3 10Motor vehicles 5 - 6Computers 2 - 3Office equipment 5 - 10Furniture and fittings 5 - 10Renovation 5 - 10

Leasehold properties are depreciated over their remaining lease period of 30 to 65 years. No depreccharged for freehold land.

There is no fixed policy with respect to the frequency of valuation of fixed assets. Fixed assets are revand when deemed appropriate by the directors.

Where fixed assets are revalued, any surplus on revaluation is credited to asset revaluation reserve. A din the net carrying amount of the asset revaluation reserve arising on revaluation of fixed assets is chargprofit and loss account to the extent that it exceeds any surplus held in reserve relating to a previous revof the same class of assets.

Fully depreciated assets are retained in the accounts until they are no longer in use.

Preliminary expenses

Preliminary expenses are stated at cost. These expenses are written off to the profit and loss statemecommencement of commercial operations.

Development properties

Development properties refer to those properties that are intended for sale in the ordinary course of bThey include completed properties and properties in the course of development and are stated at the loweand net realisable value less progress payments received. Development properties consist of land stateand development expenditure incurred to date. Development expenditure includes finance chargesexpenditure incurred in connection with the development of the properties. Finance charges are not caonce the development is completed. A development is considered complete on the date of issue of the teoccupation permit. All known or anticipated losses on the development projects are provided for in thewhich such losses are determined.

Investment property

Investment property is that which is held for its investment potential and income. Rental income is recogan accrual basis.

Investment property is stated at cost. Cost comprises the purchase price of the investment property. Repmaintenance costs are charged to the income statement in the period in which they are incurred.

No depreciation is provided on investment properties except where the unexpired term of the relevant leayears or less.

Finance leases

Fixed assets acquired under finance leases are capitalised and depreciated over their estimated usefcapital elements of future lease obligations are recorded as liabilities, while the interest elements are chargover the period of the lease to produce a constant rate of charge on the balance of capital repayments

Revenue recognition

Revenue from projects is recognised as work progresses, using the percentage-of-completion mpercentage of completion for a given project is determined after considering the relationship of value oto-date to total contract revenue for the project.

Costs of projects include raw materials, direct labour and other project related expenses incurred durinperiod. The project is considered complete when all significant identifiable costs attributable to the been incurred. Provision is made for any foreseeable losses as soon as they are known.

Revenue from sale of goods is recognised upon delivery of goods and acceptance by customers.

Maintenance revenue is recognised on a pro-rated basis over the period of the maintenance contract

Income tax

Income tax expense is determined on the basis of tax effect accounting, using the liability method anto all significant timing differences. Deferred tax benefits are not recognised unless there is reasonableof their realisation.

Foreign currencies

Transactions in foreign currencies are recorded at exchange rates approximating those ruling at thedates. Foreign currency monetary assets and liabilities at the balance sheet date are translated into thfunctional currencies at exchange rates approximating those ruling at that date. All resulting exchangeare recognised in the profit and loss statement.

Segments

For management purposes, the Group is organised on a world-wide basis into six major operating The divisions are the bases on which the Group reports its primary segment information.

Segment revenue, expenses and results include transfers between business segments and between gsegments. Such transfers are accounted for on an arm’s length basis.

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g y p y pvia the creation of 1,000,000,000 ordinary shares of $0.05 each.

In addition, the Company made a bonus issue of 366,492,000 ordinary shares of $0.05 each by way of capiof $52,574 and $18,272,026 from the Company’s accumulated profits and share premium respectively an16,000 ordinary shares of $0.05 each upon the exercise of the warrants at $0.11 per share.

4. RESERVES

Group Company

2001 2000 2001 200$ $ $ $

Share premium 1,312 18,272,026 1,312 18,27Capital reserve 3,803,445 - 3,803,445 Asset revaluation reserve 520,114 520,114 - Translation reserve 516,078 1,142 - Revenue reserve 2,713,306 7,248,935 (131,247) 6,92

7,554,255 26,042,217 3,673,510 25,20

The share premium account may be applied only for the purposes specified in the Companies Act. Theis not available for distribution of dividends except in the form of shares.

The capital reserve comprises a renounceable rights issue of warrants carrying the right to subscribeordinary shares of $0.05 each in the capital of the Company at an issue price of $0.022 for each warrabasis of one warrant for every four ordinary shares held by the shareholders.

Asset revaluation reserve comprises the surplus arising from revaluation of freehold land and building.

In accordance with Statement of Accounting Standard No.1 (Revised 1999), movements in reserves for thand the Company are set out in the Statement of Changes in Equity of the Group and the Company resp

Group

2001 20$ $

Revenue reserve retained in:

- the Company (131,247) 6,92- subsidiaries 2,729,373 51- associated companies 115,180 (19

2,713,306 7,24

(a) Group

At cost

Machinery,Leasehold tools and Motor Office Furniture Freehold FreProperties equipment Vehicles Computers Equipment and fittings Renovation Properties L

$ $ $ $ $ $Cost or ValuationAs at 1.7.2000 578,129 260,622 1,829,962 443,120 239,699 234,611 338,692 2,756,323 9,97Reclassifications 24,491 5,811 - 8,211 (16,430) (22,083) - -Attributable to subsidiaries

acquired duringthe year 1,423,600 - 190,367 - 651,133 - - -

Additions 293,735 205,996 1,442,207 468,733 309,915 182,404 180,744 25,100Disposals - (6,500) (199,504) (2,957) (3,885) (2,808) - - (2,48Written off - (41,630) - (4,900) (10,158) (11,610) (9,650) -Translation adjustment 94,582 1,943 32,927 5,752 35,499 2,498 4,014 -

As at 30.6.2001 2,414,537 426,242 3,295,959 917,959 1,205,773 383,012 513,800 2,781,423 7,49

Accumulated depreciation As at 1.7.2000 81,471 187,501 925,733 299,306 147,473 115,317 183,195 323,144Reclassifications 6,106 582 - 3,228 (3,860) (6,056) - -Attributable to subsidiaries

acquired duringthe year 89,093 - 156,244 - 555,225 - - -

Charge for the year 36,909 51,220 496,133 178,276 80,394 66,974 74,011 92,307Disposals - (3,234) (173,540) (1,417) (3,217) (1,872) - -Written off - (35,319) - (4,900) (9,532) (5,225) (9,650) -Translation adjustment 7,047 756 22,805 2,269 28,059 791 1,209 -

As at 30.6.2001 220,626 201,506 1,427,375 476,762 794,542 169,929 248,765 415,451

Charge for 2000 9,901 14,502 170,354 33,159 12,239 13,540 6,135 13,941

Net book valueAs at 30.6.2001 2,193,911 224,736 1,868,584 441,197 411,231 213,083 265,035 2,365,972 7,49

As at 30.6.2000 496,658 73,121 904,229 143,814 92,226 119,294 155,497 2,433,179 9,97

The Group’s freehold land and building have been revalued by a firm of independent professional valuers, Jones Lang LaSalle Property Cbasis of open market value for existing use. Had the freehold land and building been stated at cost less accumulated depreciation, the net 30 June 2001 would have been approximately $1,442,000 (2000: $1,449,000).

Freehold properties of a subsidiary with a net book value of approximately $2,341,000 (2000: $Nil) are mortgaged to a bank for banking faci

The Group’s leasehold properties with a net book value of approximately RM 1,249,000 and HK$ 4,641,000 (2000: RM 645,000) respectivegranted to the subsidiaries (Note 24).

The Group’s freehold land and building with a net book value of approximately $9,963,000 (2000: $Nil) are mortgaged to certain banks for a transferab

(b) Company

Machinery,Leasehold tools and Motor Office Furnitureproperties equipment vehicles Computers equipment and fittings R

$ $ $ $ $ $CostAs at 1.7.2000 249,762 100,470 688,208 107,585 61,100 69,040Additions - 8,950 108,449 21,333 2,571 3,398Disposals - (6,500) (163,504) - - -Written off - (41,630) - - - -

As at 30.6.2001 249,762 61,290 633,153 128,918 63,671 72,438

Accumulated depreciationAs at 1.7.2000 46,109 71,614 432,948 84,832 52,156 51,306Charge for the year 7,685 10,271 94,664 16,270 3,017 7,198Disposals - (3,234) (153,040) - - -Written off - (35,319) - - - -

As at 30.6.2001 53,794 43,332 374,572 101,102 55,173 58,504

Charge for 2000 7,685 10,863 99,530 14,306 5,003 7,271

Net book valueAs at 30.6.2001 195,968 17,958 258,581 27,816 8,498 13,934

As at 30.6.2000 203,653 28,856 255,260 22,753 8,944 17,734

As at 30 June 2001, the Company had fixed assets under hire purchase with a net book value of approximately $166,000 (2000 : $170,000)

Freehold land with a net book value of approximately $7,491,000 (2000: $7,491,000) is mortgaged to certain banks for a transferable loan fa

30 June 2001 (Amounts in Singapore Dollars) notes to the financial statements

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$

Unquoted equity shares at cost 29,113,361 19

(b) The Company and the Group had the following subsidiaries as at 30 June 2001:

Country of Effectiveincorporation and equity held

Name of Company Principal activities place of business by the Group Cost of i

2001 2000 2001% % $

Held by the Company Ligent Engineering Electrical contractors, Singapore 100 100 2,144,423Pte Ltd suppliers of electrical

hardware and fittings andthe provision of electricalengineering services

Victrad Enterprise Electrical contracting Singapore 100 100 464,303(Pte) Ltd and the provision of

project managementservices

Lantrovision (S) Supply, design, Singapore 50.46 51 15,625,000 1Pte Ltd installation and provision

of consultancy services onnetwork integration andstructured cabling and thoseof electrical contractors andsuppliers of electricalhardware and fittings

Strike Development Property development Singapore 51 51 510,000Pte Ltd

Strike Construction Building construction Singapore 61.2 100 260,000Pte Ltd and installation, provision

of electrical and mechanicalengineering services

Gredanian Pte Ltd Property development Singapore 70 70 700,000

Nete2 Asia Pte Ltd Supply, installation and Singapore 51 - 51,000provision of consultancyservices for tele-conferencingfacilities and development ofsoftware and multimedia works

**Gordon (HK) Interior architecture, design Hong Kong 51 - 9,358,635Designer and and decoration servicesEngineer Ltd

##Lantro (Japan) Structure, design, Japan 100 100 -Ltd installation and consulting

of network system withcomputer communicationtechnology

*Lantro (Malaysia) Design and installation Malaysia 100 100 -Sdn Bhd of computer cabling and

trading of related accessoriesand peripherals

*Lantro (Penang) Provision of cabling Malaysia 51 51 -Sdn Bhd infrastructure services and

selling cabling accessories

**Lantro Phils. Inc. Provision of contracting Philippines @ 70 -services for voice, data andtelecommunication worksand maintenance services

*Lantro (HK) Provision of system Hong Kong 100 70 -Limited integration and network

infrastructure services

Spectrum Infocom Telecommunication Singapore 60 60 -International Pte Ltd operator

#Lantro Korea Planning and installation Korea 70 - -Co. Ltd of cables for information

and communication networks

#Lantro Co. Ltd Manufacture and sale of People’s 70 - -(Hangzhou) structuralized cable laying Republic

system and multimedia of Chinatechnology

VRnet (S) Pte Ltd Trading in computers, Singapore 55 - -computer peripherals,all kinds of electroniccomponents and productsfor various applications, planners,consultants, advisers andmanagers in relation tocomputer services

**VRnet (M) Provider of integrated Malaysia 90 - -Sdn Bhd IT infrastructure services

29,113,361 19,0

* Audited by associate firms of Arthur Andersen Singapore.** Audited by other auditors.# For the financial year ended 30 June 2001, these companies are newly incorporated and are not required to b

under the laws of incorporation of their respective countries.## Not required to be audited under the laws of incorporation of the country.@ On 2 January 2001, the Company’s subsidiary reduced its equity stake in Lantro Phils. Inc. from 70% to 40%. La

Inc. thereafter became a 40% owned associated company of the Company’s subsidiary.

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236,580 3,363,707 -

(b) Details of associated companies are as follows:

Country of EffectivIncorporation and intere

Name of associated company Principal activities place of business by the

2001%

Held by a subsidiary* Lantro (Thailand) Co. Ltd Design and installation of Thailand 49

computer cabling andtrading of related accessoriesand peripherals

* Lantro Phils, Inc. Provision of contracting Philippines 40services for voice, dataand telecommunication

*VRnet (Thailand) Co., Ltd Trading of computers and Thailand 49computer peripherals andprovision of computerconsulting services

* Audited by other auditors.

@ On 2 January 2001, the Group reduced its equity stake in Lantro Phils. Inc. from 70% to 40%. Lantro Phils. became a 40% owned associated company.

9. GOODWILL ON CONSOLIDATION

Group

2001$

Goodwill on consolidation arising from acquisition of subsidiaries and associated companies, net of reserve on consolidation 15,843,979 16

Less accumulated amortisation (1,435,411)

14,408,568 15

Movements in accumulated amortisation during the year are as follows:

At beginning of year 363,450 Amortisation for the year 1,250,452 Attributable to acquisition of subsidiaries 5,292 Attributable to disposal of an associated company (183,783)

At end of year 1,435,411

2,880,000 2,880,000

Market value of quotedinvestments

Equity shares 2,880,000 - 2,880,000

11. DEVELOPMENT PROPERTIES

Group

2001 20$ $

Cost of land 37,540,727 9,38Interest capitalised during the year 1,422,146 13Development and related costs 4,273,115 3,55

43,235,988 13,07

12. STOCKS

Group Company

2001 2000 2001 200$ $ $ $

Finished goods, at cost 2,862,496 4,258,192 128,335 23Less provision for stock

obsolescence (185,404) (133,560) -

2,677,092 4,124,632 128,335 23

Movements in provision for stock obsolescence during the year are as follows:

At beginning of year 133,560 - -Provision for the year 51,297 133,560 -Translation difference 547 - -

At end of year 185,404 133,560 -

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Less progress billings receivedand receivable (118,610,206) (107,719,407) (92,610,976) (92

15,285,659 13,635,681 8,706,572 10

Movements in provision for foreseeable project losses during the financial year are as follows:

At beginning of year 955,826 955,826 904,576 Provision for the year 9,883 - 9,883 Write off against provision (329,065) - (329,065)

At end of year 636,644 955,826 585,394

14. TRADE DEBTORS

Trade debtors 22,470,522 14,997,014 157,914 Less provision for doubtful

trade debts (1,032,563) (268,585) -

21,437,959 14,728,429 157,914

Movements in provision for doubtful trade debts during the year are as follows:

At beginning of year 268,585 - -Attributable to acquisition

of subsidiaries - 31,350 -Provision for the year 908,371 237,235 -Write back of provision for the year (160,753) - -Translation difference 16,360 - -

At end of year 1,032,563 268,585 -

15. OTHER DEBTORS, DEPOSITS AND PREPAYMENTS

Other debtors 651,103 237,132 33,766 Deposits 361,920 2,828,498 14,998 Prepayments 103,183 65,239 7,770 Unbilled receivables 10,218 686,566 - Advances to staff 51,655 81,848 38,400 Interest receivable 590 1,688 -

1,178,669 3,900,971 94,934

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Group

2001 20$ $

Quoted shares at cost 115,340 115Provision for lower of cost and market value (97,335) (90

18,005 25

Market value 15,000 23

Movements in provision for the lower of cost and market value of quoted investments during the year are a

At beginning of year 90,335 44Provision for the year 7,000 45

At end of year 97,335 90

18. FIXED DEPOSITS

Fixed deposits of the subsidiaries amounting to $550,000 (2000: $1,050,000) were pledged to banks forfacilities granted to the subsidiaries.

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1,215,548 873,185 831,801

20. OTHER CREDITORS AND ACCRUALS

Other creditors 684,655 569,566 390Accrued operating expenses 2,148,918 474,262 414,193Amount payable in relation

to acquisition of subsidiary 5,593,764 - 5,593,764Rental deposits 13,759 - -Advance from customers 86,514 - -Deferred revenue 74,901 - -

8,602,511 1,043,828 6,008,347

21. SHORT TERM BANK LOANS, UNSECURED

The short term bank loans are unsecured and bear interest at approximately 3.90% to 4.25% (2004.79%) per annum.

22. SHORT TERM BANK LOANS, SECURED

Details of the short term loans are as follows:

(a) Short term loans of a subsidiary amounting to $8,750,000 bear interest at 1.5% per annum abovcost of funds and are repayable on a monthly basis. The loans are secured by:

(i) a first legal mortgage over the subsidiary’s development properties;(ii) a legal assignment of the last 15% of the sale proceeds of the development properties; and(iii) a corporate guarantee from the Company.

(b) Short term revolving bank loans of a subsidiary amounting to $950,000 which bear interest at 4%are secured by way of a legal mortgage on the subsidiary’s freehold properties with a net boapproximately $2,341,000 and a corporate guarantee by the Company.

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1,431,967 212,470 1,219,4

20001 year to 5 years 374,047 59,723 314,3Not later than 1 year 168,184 31,613 136,5

542,231 91,336 450,8

Company

20011 year to 5 years 60,839 8,642 52,1Later than 5 years 9,276 1,670 7,6

70,115 10,312 59,8Not later than 1 year 41,725 3,625 38,1

111,840 13,937 97,9

20001 year to 5 years 38,158 4,820 33,3Not later than 1 year 36,618 4,365 32,2

74,776 9,185 65,5

24. BANK TERM LOANS (SECURED)

Group Company

2001 2000 2001 200$ $ $ $

Bank loans 21,561,352 7,308,440 - 5,55Transferable loan facility 10,560,000 - 10,560,000

32,121,352 7,308,440 10,560,000 5,55Due within one year 7,081,784 1,128,918 343,776 1,06

Due after one year or more 25,039,568 6,179,522 10,216,224 4,48

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guarantee by the directors of the subsidiary. The loan bears interest at 8.25% per annum and in 180 equal monthly instalments commencing October 1996.

(c) A bank loan of HK$4,873,396 (2000: Nil) is secured by way of a fixed charge over the subsidiary’sproperty and leasehold land and buildings with a net book value of approximately HK$3,3HK$4,641,000 respectively. The loan bears interest at 1% below the bank’s prevailing primerepayable over 120 monthly instalments and is fully repayable on maturity in 2010.

Transferable loan facility

The transferable loan facility of $12,000,000 is granted to the Company at a discount of 12% aapproximately $1,440,000. The discount, being the difference between the principal amount of the loan facility and its present value on recognition, will be expensed over 4 years (the duration of the loan facility) using the effective interest rate method through the profit and loss account.

The loan is secured by way of a legal mortgage on the Group’s freehold land and building with a neof approximately $9,963,000.

$

Present value of the transferable loan facility 10,560Value of interest discount 1,440

12,000

The interest charged on the transferable loan facility is as follows:

Year Rate of interest

1 Swap Offered Rate minus 1% p.a.2 Swap Offered Rate minus 0.75% p.a.

3 & 4 Swap Offered Rate minus 0.5% p.a.

The loan is repayable in 12 equal quarterly instalments of $1,000,000 commencing 9 May 2002.

25. TURNOVER

Turnover comprises the following:

Group Company

2001 2000 2001$ $ $

Revenue from projects 79,648,157 42,996,568 11,938,895 3Sale of goods and services 12,190,514 2,010,918 3,249,428

91,838,671 45,007,486 15,188,323 3

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11,587,848 2,701,189 1,598,407 1,63

27. PROFIT (LOSS) FROM OPERATIONS

This is determined after charging (crediting) the following:

Amortisation of goodwillon consolidation 1,250,452 363,450 -

Auditors’ remuneration- auditors of the Company 123,000 55,000 39,000 2- other auditors 66,775 6,465 - Non-audit fees- auditors of the Company 54,400 66,150 54,400 5Bad trade debts written off 67,206 54,349 324 Depreciation 1,087,376 284,923 140,049 14Directors’ remuneration- directors of the Company 869,886 692,990 682,200 61- directors of subsidiaries 1,790,450 306,789 - Directors’ fees- directors of the Company 50,000 45,000 50,000 4Fixed assets written off 13,323 8,047 6,310 Foreign exchange (gain) loss – net (105,957) (10,100) 894 Goodwill written off 900 - - Loss on disposal of a subsidiary 838 - - (Gain) loss on sale of fixed assets (171,223) 8,162 (169,420)Operating lease expenses 561,946 188,392 - 6Personnel expenses (Note 26)* 11,587,848 2,701,189 1,598,407 1,63Preliminary expenses written off 24,210 - - Provision for doubtful trade debts 908,371 237,235 - Provision for forseeable

project losses 9,883 - 9,883 Provision for lower of cost and

market value of quoted investments 7,000 45,500 -

Provision for stock obsolescence 51,297 133,560 - Write back of provision for

doubtful trade debts (160,753) - -

* This includes the amount shown as directors’ remuneration.

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$0 to $249,999 3 4 7 6 2

4 4 8 6 2

29. FINANCIAL EXPENSES - NET

Group Company

2001 2000 2001$ $ $

Interest expense- hire purchase 56,450 13,634 5,472 - term loans 204,073 123,611 606,093 - bank overdrafts 202,548 681 81,296 - bills payable to banks 41,249 9,221 41,249 Bank charges 115,948 6,256 59,868

620,268 153,403 793,978

Interest income- bank balances (54,365) (1,883) - - fixed deposits (49,038) (81,515) (20,317)- subsidiaries - - (428,953)

516,865 70,005 344,708

30. EXCEPTIONAL ITEM

Provision for the lower of cost andmarket value of other investments(quoted) 6,120,000 - 6,120,000

31. TAX

Current tax- current year 3,533,642 1,827,893 -- overprovision in respect of prior year (152,819) - -Deferred tax- current year (7,046) - -- overprovision in respect of prior year (1,107) - -

3,372,670 1,827,893 -

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32. (LOSS)EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the Group’s loss attributable to members of the Com$4,483,055 (2000: profit attributable to members of the Company of $3,856,732) by the weighted averageof shares in issue during the year of 732,987,249 shares (2000: weighted average of 639,831,016 share

Diluted earnings per share is the same as basic earnings per share as the effects of anti-dilutive potentialshares are ignored in calculating diluted earnings per share.

33. RELATED PARTY INFORMATION

In addition to related party information disclosed elsewhere in the financial statements, significant tranwith related parties, on terms agreed between the parties, were as follows:

Group

2001 20$ $

IncomeSales to an associated company 653,774 12Management fee income from affiliated companies 6,932

ExpensesPurchases from an associated company 305,172Rental expenses paid to directors of subsidiaries 27,860

34. CONTINGENT LIABILITIES AND COMMITMENTS

(a) Contingent liabilities, unsecured

Group Company

2001 2000 2001 200$ $ $ $

Contingent liabilities not provided forin the financial statements:

- Bankers’ guarantee 1,411,793 4,715,924 -- Performance bonds indemnity 1,049,180 - 1,049,180- Corporate guarantees 26,093,711 - 26,093,711

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p y- not later than 1 year 449,000- 1 year through 5 years 375,000

824,000

35. SUBSEQUENT EVENTS

Subsequent to year end, the following events took place:

(i) A subsidiary, Ligent Engineering Pte Ltd acquired 540 ordinary shares of RP1,000,000 each re90% equity interest in Strike Sarana Buana (PT) Asing for a total consideration of RP540,000,00

(ii) The shareholders of a subsidiary, Lantrovision (S) Pte Ltd (“Lantrovision”) approved, inter alia, t

(a) the increase in the authorised share capital of Lantrovision from S$1,000,000 comprisin

ordinary shares of S$1 each to S$50,000,000 comprising 50,000,000 ordinary shares of S$

(b) the bonus issue of 3,638,400 ordinary shares of $1 each by way of capitalisation of S$102share premium account and S$3,536,400 from Lantrovision’s accumulated profits ;

(c) the sub-division of each ordinary share of S$1 each in the authorised and issued and pacapital of Lantrovision into 50 ordinary shares of S$0.02 each;

(d) the adoption of the Lantrovision Share Option Scheme (the “Scheme”) and that the Directors bto issue and allot shares upon the exercise of options granted under the Scheme provided number of shares alloted and issued under the Scheme does not exceed 5% of the issued sof Lantrovision for the time being;

(e) the conversion of Lantrovision into a public limited company and the change of its name to Lantrov

(f) the adoption of a new set of Articles of Association for the Company;

(g) the issue of 39,180,000 new shares of S$0.02 each pursuant to the Placement, which when issued and fully paid, will rank pari passu in all respects with the existing ordinary shares of

(h) subject to the provisions of Section 161 of the Companies Act, Cap. 50 and the provisions oArticles of Association of the Company upon their becoming effective, the directors of Lanauthorised with effect from the date of listing and quotation of all the issued shares of Lanthe Singapore Exchange Securities Trading Limited to allot and issue such further sharesand from time to time thereafter to such persons and on such terms and conditions and for suas the directors may, in their absolute discretion, deem fit provided that the aggregate numbproposed to be issued shall not exceed 50 per cent of the issued share capital of Lantrovisionprior to the proposed issue, and provided that the aggregate number of such shares to be than on a pro-rata basis to the then existing shareholders of Lantrovision shall not exceedof the issued share capital of Lantrovision immediately prior to the said issue. Such a geneshall only remain in force until:

(i) the conclusion of the first annual general meeting of the listed Company following ththe resolution at which time it shall lapse unless, by ordinary resolution passed at that mandate is renewed, either unconditionally or subject to conditions, or

(ii) the shareholders of Lantrovision by an ordinary resolution in a general meeting revoke general mandate, whichever is earlier

(i) the shareholders’ mandate authorising members of the Lantrovision Group to enter into certainwith persons which are considered as “interested persons” under Chapter 9A of the SGX-ST Lis

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Inter segment pricing is on an arm s length basis.

Mechanical Information2001 Electrical engineering technology Architecture Property

engineering and others cabling Networking and design development G

$’000 $’000 $’000 $’000 $’000 $’000 $

Turnover 15,148 9,131 60,451 639 6,470 - 9

Profit (loss) fromoperations (757) (574) 10,352 (525) 1,090 (16)

Financial expenses– net

Share of results ofassociated companies

Exceptional itemTaxMinority interests

Loss after tax

Assets 15,473 9,327 44,658 1,896 17,465 43,421 13Other investments

13

Liabilities, representingtotal segmentliabilities 17,693 10,048 14,931 732 2,963 29,519 7

Capital expenditureDepreciation and

amortisation

4

4

associated companiesTaxMinority interest

Net profit

Assets 34,596 19,096 37,066Investment in associated

companies

Liabilities, representing totalsegment liabilities 21,491 8,552 14,766

Capital expenditureDepreciation and amortisation

(b) Geographical segments

Turnover is based on the location of customers regardless of where the goods are produced. Assets ato property, plant and equipment are based on the location of those assets.

Turnover Assets Capital expen

2001 2000 2001 2000 2001$’000 $’000 $’000 $’000 $’000

Singapore 54,492 42,027 100,411 88,881 2,412Malaysia 13,035 1,944 6,786 2,995 499Hong Kong 8,453 686 5,324 1,497 49China 7,967 - 18,401 - 29Others 7,892 350 4,198 749 120

91,839 45,007 135,120 94,122 3,109

37. COMPARATIVES

Where necessary, the prior year financial statements have been restated to conform with the cupresentation in accordance with the new presentation requirements of Statement of Accounting Sta(Revised 1999), Presentation of Financial Statements, Statement of Accounting Standard No. 15 (ReLeases and Statement of Accounting Standard No. 23 (Revised 1999), Segment Reporting.

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Fixed Assets

Location Description Title Land Area U

sq m

Singapore

No 422 Tagore Industrial Avenue A single-storey detached factory Freehold 2,100.6 OSingapore 787806 building with mezzanine level War

No 22 Tagore Lane A single-storey intermediate Freehold 499.2 OSingapore 787480 terrace factory building War

with mezzanine level

102F Pasir Panjang Road Flatted warehouse Freehold 175.0 O#03-03 Citilink Warehouse ComplexSingapore 118530

102F Pasir Panjang Road Flatted warehouse Freehold 131.0 War#03-09 Citilink Warehouse ComplexSingapore 118530

China

Unit No 101 Building No.B1 Apartments Leasehold 132.7 Staff AJin Mao DistrictFunan, Hainan

Unit No 102 Building No.B1 Apartments Leasehold 132.7 SJin Mao District ApaFunan, Hainan

Room 201No 14 Yue Ji Garden, Apartments Leasehold 77.83 SLane 67 Guaping Road ApaShanghai

Room 202 SNo 14 Yue Ji Garden, Apartments Leasehold 77.83 ApaLane 67 Guaping RoadShanghai

Room 301 SNo 14 Yue Ji Garden, Apartments Leasehold 77.83 ApaLane 67 Guaping RoadShanghai

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o y

No 69 Jalan 3/23A A three-storey shop/ Leasehold 164.0Taman Danau Kota office building (99 years from W53300 Setapak, Kuala Lumpur 2 Nov 1990)

No 71 Jalan 3/23A A three-storey shop/ Leasehold 164.0Taman Danau Kota office building (99 years from W53300 Setapak, Kuala Lumpur 2 Nov 1990)

Development Properties

Interest ApproximateGross Held in Percentage

Description Address Title Site Area Floor Area property Completion

sq m sq m % %

Singapore

Chiverton 50 Ewe Boon Road Freehold 967.4 2,012.9 51 4(Development of (Lots 600C and a block of 601M TS 26 16-storey comprising Ewe Boon Road)15 units of residential apartments)

Proposed 40 Stevens Road Freehold 2,801.3 4,482.08 70 -development of (Lots 400A and a block of 12-storey 538L TS 26 comprising 34 Stevens Road) units of residential apartments with communal facilities

The number of board meetings held in the financial year ended 30 June 2001, as well as the attendanceboard member at those meetings is given on page 48.

2 Audit Committee

The Audit Committee (“AC”) comprises:

Lew Syn Pau (Chairman) Independent Non-Executive Director Tan Kim Chew Independent Non-Executive Director

Chua Koh Ming Executive Director

The AC had held 2 meetings during the financial year ended 30 June 2001. The number of AC meetings willprogressively as the Group moves towards quarterly reporting of its financial results by January 2003carried out its functions in accordance with the Companies Act Cap. 50 and the Singapore Exchange STrading Limited (“SGX”) Listing Manual. In performing those functions, the Audit Committee inter alia re

(a) the overall scope of external audits and the assistance provided by the Group’s officers to the audit

(b) the auditors’ evaluation of the system of internal accounting controls arising from their audit;

(c) interested party transactions in accordance with Chapter 9A of the SGX Listing Manual to satisfy thethat the transactions are on normal commercial terms; and

(d) the financial statements of the Company and the consolidated financial statements of the Groupauditors’ report on those financial statements before their submission to the Board of Directors.

Apart from the duties listed above, the AC has the power to conduct or authorise investigations into mattethere is any suspected fraud or irregularity, or failure of internal controls or infringement of any Singaporeor regulation which has or is likely to have a material impact on the Group’s operating results and/or financial

The AC is given complete access to and co-operation from management and has the full discretion to indirector and executive officer to attend its meetings. All management resources are made available for tproperly function and discharge its duties.

In the opinion of the AC, the Company complies with the SGX Best Practices Guide on Audit Committee

The AC having reviewed the volume of non-audit services to the Company by the external auditors, asatisfied that the nature and extent of such services will not prejudice the independence and objectivexternal auditors, are pleased to confirm their re-nomination of Arthur Andersen as the Company’s auditoforthcoming annual general meeting of the Company for the ensuing financial year ending 30 June 200Andersen have expressed their willingness to accept re-appointment.

3 Internal Controls

The Group’s internal controls and systems are designed to provide reasonable assurance as to the intereliability of the financial information and to safeguard and maintain accountability of its assets. There is defined delegation of authority from the Board of Directors to the operating companies. Procedures arefor authorisation of contracts, capital expenditures and investments. Comprehensive budgeting systemplace to develop budget for each project and annual budgets covering other key aspects of the businesperformance is compared with budgets for monitoring purposes.

4

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orat practices with specific reference to the Code of Corporate Governance in their annual reports. The

currently reviewing the Board composition and the setting up of relevant sub-committees in due cour

Meetings Compliance

Each director attended the following meetings and board committees during the financial year ended 30while a member of the board:

Board Audit Commit

Name Number of Number of Number of Numeetings held meetings meetings held m

attended a

Yeo Jiew Yew 5 5 2Umar Abdul Hamid 5 5 2Chua Koh Ming 5 5 2Lew Syn Pau 5 4 2Tan Kim Chew 5 4 2Lim Soon Hock [appointed on 29.4.00] 5 3 2Lum Chue Tat [appointed on 23.5.00] 5 5 2Then Khek Koon [appointed on 23.5.00] 5 4 2

TOTAL 4,934 100.00 733,000,000 10

Substantial Shareholders

As at 11 October 2001 as recorded in the Register of Substantial Shareholders:-

Direct Interest % Deemed Interest

Yeo Jiew Yew 112,200,000 15.31 -

Sim Yew Heng 101,317,000 13.82 -

Chua Koh Ming 64,336,000 8.78 600,000 (1) 0

UAH Investments Pte Ltd - - 53,300,000 (2) 7

Umar Abdul Hamid 91,108 0.01 61,605,000 (3) 8

Notes:

(1) 600,000 held in the name of Overseas Union Trust (Nominees) Pte Ltd

(2) 20,500,000 held in the name of Hong Leong Finance Nominees Pte Ltd32,800,000 held in the name of Southern Nominees (S) Sdn Bhd

53,300,000

(3) 5,000,000 held in the name of Phillip Securities Pte Ltd3,305,000 held in the name of SBS Nominees (S) Pte Ltd

53,300,000 held by UAH Investments Pte Ltd (Deemed Interest)*

61,605,000

* Mr Umar Abdul Hamid, an Executive Director of the Company, is deemed to be interested in the shares UAH Investments Pte Ltd by virtue of section 7 of the Companies Act, Cap. 50

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reh 5 United Overseas Bank Nominees Pte Ltd 28,070,000

6 Ng Gek Noi 24,172,000

7 Yeo Yew Yap 23,500,000

8 HL Bank Nominees (S) Pte Ltd 23,045,000

9 Hong Leong Finance Nominees Pte Ltd 21,337,000

10 Citibank Consumer Nominees Pte Ltd 16,037,000

11 Mayban Nominees (S) Pte Ltd 15,935,000

12 Lum Chue Tat 12,712,000

13 DBS Nominees Pte Ltd 11,356,000

14 Chan Thye Yuan 11,112,000

15 Far Eastern Bank Nominees Pte Ltd 8,993,000

16 Keppel Bank Nominees Pte Ltd 8,223,000

17 Phillip Securities Pte Ltd 7,091,000

18 UOB Kay Hian Pte Ltd 6,656,000

19 Thomas Lee Soo Hua 6,504,000

20 Overseas Union Trust (Nominees) Pte Ltd 3,720,000

TOTAL 551,659,324

g

1 - 1,000 129 7.49 115,027 01,001 - 10,000 579 33.60 3,335,15010,001 - 1,000,000 995 57.75 90,827,892 491,000,001 and above 20 1.16 88,951,931 48

TOTAL 1,723 100.00 183,230,000 100

Substantial Warrantholders

As at 11 October 2001 as recorded in the Register of Substantial Warrant holders:-

Direct Interest % Deemed Interest

Yeo Jiew Yew 28,050,000 15.31 -

Twenty Largest Warrantholders

No. Name No. of Warrants

1 Yeo Jiew Yew 28,050,000 15.3

2 United Overseas Bank Nominees Pte Ltd 12,536,000 6.

3 Ng Gek Noi 6,043,000 3.3

4 Chan Thye Yuan 6,028,000 3.2

5 Low Siew Khang Denis 5,866,750 3.2

6 Citibank Consumer Nominees Pte Ltd 5,637,000 3.

7 Southern Nominees (S) Sdn Bhd 3,921,831 2.

8 G K Goh Stockbrokers Pte Ltd 2,835,500 1.5

9 Lim Peng Aun 2,135,000 1.

10 UOB Kay Hian Pte Ltd 2,089,500 1.

11 Phillip Securities Pte Ltd 2,033,850 1.

12 OCBC Securities Private Ltd 1,581,500 0.

13 HSBC Republic Bank (Suisse) SA 1,525,000 0.

14 Singapore Nominees Pte Ltd 1,444,000 0.

15 Hong Leong Finance Nominees Pte Ltd 1,388,000 0.

16 DBS Vickers Securities (S) Pte Ltd 1,205,500 0.

17 Lioe Kyun Jin 1,203,000 0.

18 Deok Lai Heng 1,200,000 0.

19 Lee Song 1,163,000 0.

20 Neo Bee Wah 1,065,500 0.5

TOTAL 88,951,931 48.5

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e Mr Lew Syn Pau will, upon re-election as a Director of the Company, remain as Chairman of the Audiand will be considered independent for the purposes of Clause 902(4)(a) of Listing Manual of the SingapoSecurities Trading Limited.

3. To approve the payment of Directors’ fees of S$50,000 for the year ended 30 June 2001 (previous year: S(Re

4. To re-appoint Messrs Arthur Andersen as the Company’s Auditors and to authorise the Directorsremuneration. (Re

5. To transact any other ordinary business which may properly be transacted at an Annual General Meeti

As Special Business

To consider and if thought fit, to pass the following resolutions as Ordinary Resolutions, with or without any m

6. Authority to allot and issue shares up to 50 per centum (50%) of issued capital

That pursuant to Section 161 of the Companies Act, Cap. 50 and Clause 941(3)(b) of the Listing MSingapore Exchange Securities Trading Limited, the Directors be empowered to allot and issue shares of the Company at any time and upon such terms and conditions and for such purposes as the Directheir absolute discretion, deem fit provided that the aggregate number of shares to be allotted and issuto this Resolution shall not exceed fifty per centum (50%) of the issued share capital of the Companybeing, of which the aggregate number of shares to be issued other than on a pro rata basis to all shathe Company shall not exceed twenty per centum (20%) of the existing issued share capital of the Cothat such authority shall, unless revoked or varied by the Company in general meeting, continue in foconclusion of the Company’s next Annual General Meeting. [See Explanatory Note] (Re

By Order of the Board

Wong Siew ChuanSecretary

Singapore, 5 November 2001

Explanatory Note:

The Ordinary Resolution 6 proposed in item 6 above, if passed, will empower the Directors from the date Meeting until the date of the next Annual General Meeting, to allot and issue shares in the Company. Thshares which the Directors may allot and issue under this Resolution would not exceed fifty per centum issued share capital of the Company for the time being. For issue of shares other than on a pro ratashareholders, the aggregate number of shares to be issued shall not exceed twenty per centum (20%) ofissued share capital of the Company.

Notes:

1. A Member entitled to attend and vote at the Annual General Meeting (the “Meeting”) is entitled to appto attend and vote instead of him/her/it. A proxy need not be a Member of the Company.

2. If the appointor is a corporation, the instrument appointing a proxy must be executed under seal or thduly authorised officer or attorney.

3. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 22 TSingapore 787480 not less than forty-eight (48) hours before the time for holding the Meeting.

I/We,

of (a

being a member/members of STRIKE ENGINEERING LIMITED (the “Company”), hereby appoint:

NRIC/Passport ProportioName Address Number Shareholdi

and/or (delete as appropriate)

NRIC/Passport ProportioName Address Number Shareholdi

or failing him/her, the Chairman of the Meeting as my/our proxy to vote for me/us on my/our behalf at the AnnuaMeeting (the “Meeting”) of the Company to be held on Thursday, 22 November 2001 at 10.00 am and at any adjothereof. The proxy is to vote on the business before the meeting as indicated below. If no specific direction as is given, the proxy will vote or abstain from voting at his/her discretion, as he/she will on any other matter athe Meeting:

No. Resolutions relating to: For Agai

1 Directors’ Report and Accounts for the year ended 30 June 2001

2 Re-election of Mr Lew Syn Pau as a Director

3 Re-election of Mr Umar Abdul Hamid as a Director

4 Approval of Directors’ fees amounting to S$50,000

5 Re-appointment of Messrs Arthur Andersen as Auditors

6 Authority to allot and issue new shares

(Please indicate with a cross [X] in the space provided whether you wish your vote to be cast for or against the Reas set out in the Notice of the Meeting.)

Dated this day of 2001

Total number of Shares in: No. of S

(a) CDP Register

(b) Register of Members

Signature of Shareholder(s)or, Common Seal of Corporate Shareholder

✃

5

4

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xy his/her shareholding (expressed as a percentage of the whole) to be represented by each proxy.

4. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company Lane, Singapore 787480 not less than forty-eight (48) hours before the time appointed for the Annual Gene

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

6. A corporation which is a member may authorise by resolution of its directors or other governing body as it thinks fit to act as its representative at the Meeting, in accordance with Section 179 of the ComChapter 50 of Singapore.

General:

The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incompletecompleted or illegible or where the true intentions of the appointor are not ascertainable from the instruappointor specified in the instrument appointing a proxy or proxies. In addition, in the case of Shares enDepository Register, the Company may reject any instrument appointing a proxy or proxies lodged if the methe appointor, is not shown to have Shares entered against his name in the Depository Register as at forty-eigbefore the time appointed for holding the Meeting, as certified by The Central Depository (Pte) Limited to th

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