Epicentre holding
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Transcript of Epicentre holding
EpiCentre Holdings Limited37 Jalan Permimpin, Clarus Centre
Block A, #08-02B, Singapore 577177
Tel: +65 6100 9100 Fax: +65 6101 9111
Annual Report 2011
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To be the Best Digital Lifestyle Store in Asia.
Delivering a delightful customer’s shopping
experience and providing value adds to our
stakeholders.
Total Commitment to Customers, unmatched
service excellence and innovative services
for their one stop Digital Lifestyle needs.
Innovation Learning Ownership
Vision Excellence Integrity Teamwork
This document has been prepared by the Company and its contents have been reviewed by the Company’s sponsor (“Sponsor”), Asian Corporate Advisors Pte. Ltd., for compliance with the relevant rules of the Singapore Exchange Securities Trading Limited (“Exchange”). The Company’s Sponsor has not independently verifi ed the contents of this document including the correctness of any of the fi gures used, statements or opinions made.
This document has not been examined or approved by the Exchange and the Exchange assumes no responsibility for the contents of this document including the correctness of any of the statements or opinions made or reports contained in this document.
The contact person for the Sponsor is Mr Liau H.K.Telephone number: 6221 0271
Designed and produced by
(65) 6578 6522
Epicentre Holdings Limited
37 Jalan Pemimpin
#07-04 Clarus Centre
Singapore 577177
Telephone: +65 6601 9100
Facsimile: +65 6601 9133
Website: www.epicentreasia.com
11ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
con
ten
ts.
corporateprofi leAs an Apple Premium Reseller (APR), EpiCentre is the first-mover to deliver not only a complete range of Apple
products, but also an industry leader in providing the most comprehensive variety of Apple and non-Apple
branded accessories and innovative services, as well as complementary products under its own proprietary
iWorld® brand.
Incorporated in Singapore in April 2002 and listed on Singapore Exchange in January 2008, EpiCentre is a pioneer in
taking IT retail away from the usual geek haunts to an upscale mall at Orchard Road. Headquartered in Singapore,
EpiCentre has regional presence in Singapore, Malaysia and China.
EpiCentre offers customers a one-stop shop digital lifestyle shopping experience where customers are encouraged
to touch, feel and test the range of Apple products offered. EpiCentre also provides after-sales support at its stores.
This includes the iConcierge – where support and guidance for Mac users can be obtained – and a trade-in service,
where Apple products can be brought in for valuation and traded-in for a new product.
The EpiCentre philosophy revolves around innovation because with it comes fresh, new and effective ideas, actions
and services, which will allow the brand to value-add to its customers, employees and stakeholders.
EpiCentre founder, Mr Jimmy Fong Teck Loon was
recently awarded the Overall Winner,
Top Entrepreneur of the Year 2011,
a Rotary-ASME Award.
Provide fresh, new & effective ideas, actions,
services & value add to our customers,
employees and stakeholders.
Provide fresh new & effective idea
innovationProvide fresh newProvide fresh new & effeProvide fresh new & effe
01 corporate profi le
02 chairman’s statement
05 fi nancial highlights
06 board of directors
09 awards and achievements
10 ten reasons to buy from EpiCentre
12 store listing
14 corporate information
16 group structure
17 corporate governance report
31 fi nancial statements
90 statistics of shareholdings
92 addendum
112 notice of annual general meeting
119 notice of book closure date
proxy form
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
2EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
Dear Valued Shareholders,
FY 2011 has been a difficult year for the retail industry; fraught
with uncertainty in the external environment precipitated by the
fallout of the Euro crisis, the natural disasters in Queensland and
Japan regions, and most recently, the downgrade of US credit
ratings. Despite these challenges, Epicentre Holdings Limited
(“Epicentre” or the “Group”), has managed to thrive in the face
of adversity to forge ahead with yet another stellar performance.
I am delighted to announce the Group has managed to exceed
all expectations to mark an exceptional year, by turning in our
best ever showing capped with unprecedented record-breaking
achievements.
For the financial year ended 30 June 2011, the Group’s revenue
surged to an all-time high of 84.6 per cent to S$162.6 million.
Profit from operations is S$5.7 million, and net profit after tax is
represented by a stellar increase of 40.1 per cent or S$4.7 million.
This is largely attributed to a strong consumer sentiment and ever-
growing demand for Apple products, which contributed S$66.8
million, or 89.7 per cent to the overall increase in revenue.
Our operations in Malaysia has also racked up an equally vigorous
display by registering revenue of S$23.5 million, up more than
two-fold over S$10.5 million reported in the previous year.
In view of the Group’s profitable performance, I propose a full year
dividend of 5 cents per share, subject to shareholders’ approval of
the proposed final dividend of 4 cents per share.
Moving forward, the Group maintains a conscientious perspective
whilst widening our distribution network. This is reflected in our
current strategic agenda, which oversees the opening of 4 new
stores in Singapore and Malaysia by the end of FY 2012. The
Group remains cautiously optimistic over market prospects, due
to more revenue-generating Apple products, especially the highly
anticipated new iPods and iPhones expected to launch within the
near future. A reciprocally adequate number of stores will hold us
in good stead towards meeting this projected demand.
learninglearningContinuous learning.
Open learning and sharing
of knowledge with one another.
In addition, China has been earmarked as a key target market that
represents exponential potential for growth.
In tandem with the Group’s growth, we have embarked on
Customer Centric Initiative (CCI) – a national initiative by SPRING
Singapore – to develop and implement a Service Excellence
Management System based on the Business Excellence
Framework. In conjunction with this CCI, we are implementing a
Customer Relationship Management (CRM) programme to build
customer loyalty towards our brand.
Our continual efforts to bring an innovative retail experience to our
customers have resulted in a successful launch of the EpiCentre
App. In the mid-term, we aim to complete the transformation
from an Apple Premium Reseller to the holistic digital lifestyle
brand that we are, with plans in the pipeline for a boutique-style
concept store.
I also believe that when you are successful you should be
giving back to society. Being an advocate of corporate social
responsibility, we have recently adopted the Children’s Cancer
Foundation as our sponsored charity, and will be organising a
Charity Run in November.
Finally, I would like to express my heartfelt appreciation for the
constant commitment that our management and staff have
devoted to the Group. I would also like to thank all our customers,
suppliers and partners for their dedicated support over the years,
as we strive to add to our collaborative milestones towards
achieving greater mutual profitable successes. Most importantly,
I would like to thank the shareholders for their continued interest
and confidence in our Group, as well as all the Board members
for their invaluable insights and guidance.
chairman’sstatement Jimmy Fong Teck Loon
Executive Chairman and Chief Executive Offi cer
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
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Operations Review
FY 2011 proved to be a good year for the Group with an
overall increase in revenue to S$162.6 million from S$88.1
million in FY 2010, registering an increase of 84.6 per cent.
Meanwhile, profit for FY 2011 rose to S$4.7 million from
S$3.4 million in the previous year, translating to a 40.1 per
cent increase. The increase in revenue can be attributed to a
strong and growing demand for Apple products, fuelled by
the launch of the iPad in FY 2011.
Singapore’s operations posted continued growth, with an
increase in revenue from S$77.5 million to S$139.1 million
in FY 2011. All six stores reported strong growth, aided by
the increase in revenue from third party complementary
products, whose sales was once again, propelled by the
growing demand for Apple products. Furthermore, two of the
stores opened in FY 2010 were in operations for the whole
period of FY 2011, leading to the increase in overall revenue.
In Malaysia, revenue from its operations in FY 2011 was S$23.5
million, more than double of the S$10.5 million it registered
in FY 2010. This is due to strong consumer sentiments and
a constant high demand for Apple products. Profit before
tax climbed 75.7 per cent from S$0.4 million in FY 2010 to
S$0.7 million in FY 2011 because of increase in revenue and
tight control over operating expenses.
Compared to FY 2010, inventory increased from S$8.1 million
to S$10.1 million in FY 2011. This is following the increase
in the number of stores. Also, an improvement in consumer
demand of Apple products was anticipated, leading to the
corresponding increase in inventory.
The ongoing sovereign debt crisis and uncertain recovery
in the US threaten to affect consumer sentiments and
performance in the existing countries that the Group operates
in. However, we will forge ahead, albeit along a cautious
approach, and focus on widening distribution networks in
existing markets. There are currently plans to open a minimum
of 4 new stores in Singapore and Malaysia while venturing
into the China market. The target is for 2 new stores to be
opened in Shanghai by the end of 2011 and possibly more
by mid 2012.
oooor the Group with an
666 million from S$88.1
eeease of 84.6 per cent.
tttto S$4.7 million from
nslating to a 40.1 per
can be attributed to a
eee products, fuelled by
nnnnued growth, with an
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oooong growth, aided by
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aaaain, propelled by the
uuuurthermore, two of the
eeeerations for the whole
aaase in overall revenue.
sss in FY 2011 was S$23.5
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ssssumer sentiments and
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million in FY 2010 to
ccccrease in revenue and
ased from S$8.1 million
fffofollowing the increase
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nnnnd uncertain recovery
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ns to open a minimum
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0011 and possibly more
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
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ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
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fi nancialhighlights
Net Profi t Attributable to Shareholders(S$M)
Revenue(S$M)
2011
162.6
2010
88.1
2009
65.0
2011
4.7
2010
3.4
2009
1.8
2011
24.2
2010
14.3
2009
10.9
2011
5.7
2010
4.1
2009
2.1
Gross Profi t(S$M)
Profi t Before Tax(S$M)
Take pride in your work; be accountable with your job.
Act on the best interests of the company.
Speed in execution and implementation.
Take pride in your work; be accoun
ownershipTake pride in your work;ake pride in your work
ownership
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
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board ofdirectors
visionAbility to think and plan ahead
according to business needs.
Jimmy Fong Teck Loon
Executive Chairman &
Chief Executive Officer
Mr Fong is our Executive Chairman
and Chief Executive Officer and was
the founder of the Group. He began
his career in 1991 and worked with
Oversea-Chinese Banking Corporation
as an IT systems auditor before moving
on to hold various senior positions in
blue-chip companies such as Citibank,
Schlumberger Oilfield Services, Sun
Microsystems and I.B.M. World Trade Asia
Corporation. Prior to establishing our
Company in 2002, he was the Director
of Finance for the Asia Pacific region
with Intensia Asia Pacific. Appointed
to the Board on 9 April 2002, Mr Fong
is responsible for setting the strategic
direction, tracking the financial and
profitability growth of the Group, as well
as managing the business and overseeing
all aspects of the daily operations of
the Company. He holds a Bachelor of
Commerce and Administration from the
Victoria University of Wellington, and a
Master of Business Administration from
the Rutgers State University of New
Jersey. He was recently awarded the
Outstanding Entrepreneur Award at the
Asia Pacific Entrepreneurship Awards
2011; Overall Winner and Winner of EYA
for Info-Communications Technology
2011 at The Entrepreneur of the Year
2011 – a Rotary-ASME Award. He was
re-elected as the Director on 29 October
2010.
Brenda Yeo
Executive Director
Ms Yeo is our Executive Director who was
appointed to our Board on 21 February
2007. She was re-elected as a Director on
30 October 2008. She oversees the human
resource department of our Group and
has more than 10 years of experience in
human resource. In 2005, she first joined
our Group as a human resource executive
and was promoted to a personal assistant
in 2006. She holds a Diploma in Human
Resource Management from the
International Business and Management
Education Centre.
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
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Siow Chee Keong
Lead Independent Director
Mr Siow is our Lead Independent Director
and was appointed to our Board on 10
December 2007. He was re-elected as
the Director on 30 October 2009. He has
many years of audit and management
experience in operations, business
systems, information technology, finance
and accounting with commercial and
financial organisations in Canada, USA,
England and Singapore. He is currently
the Managing Director of JF Virtus Pte.
Ltd. and offers audit, risk and consultancy
services to listed companies. Mr Siow
qualified as a Chartered Certified
Accountant with the Association of
Chartered Certified Accountants in 1981,
a Certified Internal Auditor with the
Institute of Internal Auditors Inc. in 1985,
a Certified General Accountants with
the Certified General Accountants of
Canada in 1990 and is a member of the
Institute of Certified Public Accountants
of Singapore. He graduated from the
University of Warwick, England, with a
Master of Business Administration. Mr
Siow is on the board of several listed
and private companies, and is a member
of the Singapore Institute of Directors.
The listed companies are Darco Water
Technologies Limited, CMZ Holdings
Limited, Sunvic Chemicals Holdings
Limited and Shanghai Asia Holdings
Limited.
Ron Tan Aik Ti
Independent Director
Mr Tan was appointed to our Board on
3 August 2010. He was re-elected as the
Director on 29 October 2010. Exercising
a wealth of experience in licensing,
merchandising, retail and distribution
markets, he is currently the Partner in
First Alverstone Partners and a Director of
Friven Asia Production, the exclusive Asian
licensee and merchandiser of the popular
Hi-5 Group. Friven Asia Production (FAP)
was acquired in March 2009 by a SGX-
listed company – Friven & Co. A former
Singapore Government’s Scholar, Mr Tan
has also served in various distinguished
and management positions at Media
Corporation of Singapore, LexisNexis Asia
Pacific in Singapore and Hong Kong, and
the Singapore Tourism Board/Economic
Development Board of Singapore. He
brings with him a balanced yet rare mix
of public, corporate, and entrepreneurial
experiences. Mr Tan holds a Bachelor of
Science degree from the University of
Hawaii, Manoa.
Azman Hisham Bin Jaafar
Independent Director
Mr Azman was appointed to our Board
on 3 November 2010. He is an Advocate
& Solicitor, and Partner of RHT Law LLP,
heading the firm’s Indonesia Practice.
He has advised and represented
clients in numerous transactions
involving mergers and acquisitions,
corporate finance, mining, and oil and
gas transactions in Singapore, China
and Indonesia. He fluently speaks and
writes Mandarin and Bahasa Indonesia,
and is a guest tutor at the National
University of Singapore Law Faculty’s
Legal Case Studies programme. He is
also a regular speaker at seminars on
mergers and acquisitions, initial public
offerings and regulatory compliance in
Singapore and Indonesia. Mr Azman was
named AsiaLaw Leading Lawyers 2009
– Capital Markets/Corporate Finance
and Corporate Governance. In 2007, he
was awarded a Public Service Medal
(Pingat Bakti Masyarakat, PBM) by the
President of the Republic of Singapore
in recognition of his contribution as a
councillor with Northeast Community
Development Council, from which
he recently received a Long Service
Award. He obtained LL.B (Hons) from
the National University of Singapore.
From left to right: Mr Siow Chee Keong, Ms Brenda Yeo, Mr Jimmy Fong Teck Loon, Mr Ron Tan Aik Ti, Mr Azman Hisham Bin Jaafar
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
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ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
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awards and achievements
1 - The Entrepreneur of the Year 2011- A Rotary - ASME Award, Overall Winner
2 - The Entrepreneur of the Year 2011- A Rotary - ASME Award, Winner of EYA for
Info-Communications Technology
3 - Asia Pacifi c Entrepreneurship Awards 2011 - Outstanding Entrepreneurship Award
4 - Singapore Prestige Brand Award 2010 - Overall Winner, Promising Brand
5 - Apple South Asia Conference 2010 - Platinum Partner Award
6 - Singapore Prestige Brand Award 2009 - Promising Brand Winner
7 - Apple Top 3 Merchandising Award 2009
8 - Apple Top APR POS Asia 2008
9 - Apple Top POS Asia 2007
10 - Apple Best POS Asia 2006
11 - Best Apple Centre 2003 - Gold Singapore 2003
1
5
9 10 11
6 7 8
2 3 4
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
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Membership
Privileges
Training
Workshops
Trade-in
Services
iConcierge
Services
30-Day Extended
Exchange Period
Best Value
Deals
Great
Locations
Latest and Widest
Range of Apple Accessories
Qualifi ed and Certifi ed
Mac Evangelists
Authorised
Repair Centre
reasons to buy from EpiCentre
excellencePerform 2Q & 1T.
Quality service to customers. Quantity to sales.
Transcend beyond job scope.
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
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EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
12EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
EpiCentre@Wheelock Place501 Orchard Road
#02-20/23, Wheelock Place
Singapore 238880
Tel : +65 6238 9378
EpiCentre@ION Orchard2 Orchard Turn
#B3-14, ION Orchard
Singapore 238801
Tel : +65 6509 5028
EpiCentre@Suntec City3 Temasek Boulevard
#02-179, Suntec City Mall
Singapore 038983
Tel : +65 6835 8168
EpiCentre@313 Somerset 313 Orchard Road,
#01-19/20, 313@Somerset
Singapore 238895
Tel: +65 6509 5043
EpiCentre@Yu Fashion GardenL126 & 127, Yu Fashion Garden,
No. 168 Middle Fangbang Road
Huangpu District
Shanghai
Tel : +86 21 3376 7500
Fax : +86 21 3376 7501
EpiCentre@Bugis Junction200 Victoria Street
#01-55/56/57, Bugis Junction
Singapore 188021
Tel : +65 6338 4855
EpiCentre@Marina Bay Sands 2 Bayfront Avenue #B2-100A
The Shoppes at Marina Bay Sands
Singapore 018972
Tel: +65 6688 7070
china
store listingsingapore
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
13
EpiCentre@Pavilion KL168 Jalan Bukit Bintang
Lot 5.24.07, Level 5, Pavilion
55100 Kuala Lumpur
Tel : +603 2141 6378
EpiCentre@Fahrenheit88Lot G-23 Ground Floor, Fahrenheit88
179 Jalan Bukit Bintang
55100 Kuala Lumpur
Tel : +603 2143 8001/8002
Fax : +603 2143 8003
EpiCentre@Lim Kok Wing Campus Store Lot 27, Innovasi 1-1, Jalan Teknorat 1/1
63000, Cyberjaya,
Selangor Darul Ehsan
Tel: +603 83180300
EpiCentre@e@CurveLot G36 -38, Ground Floor
e@Curve, No. 2A, Jalan PJU 7/3
Mutiara Damansara
47810 Petaling Jaya
Tel : +603 7726 1006/2006
Fax : +603 7726 3006
EpiCentre@IOI Mall Lot E27 & 28, Ground Floor, IOI Mall,
Batu 9, Jalan Puchong, Bandar
Puchong Jaya 47100, Puchong,
Selangor Darul Ehsan
Tel: +603 8075 0870/0871
malaysia
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
14EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FULL NAME OF COMPANY
Epicentre Holdings Limited
COMPANY REGISTRATION NUMBER
200202930G
WEBSITE
www.epicentreasia.com
BOARD OF DIRECTORS
Jimmy Fong Teck Loon (Executive
Chairman and Chief Executive Officer)
Brenda Yeo (Executive Director)
Siow Chee Keong
(Lead Independent Director)
Ron Tan Aik Ti (Independent Director)
Azman Hisham Bin Jaafar
(Independent Director)
AUDIT COMMITTEE
Siow Chee Keong (Chairman)
Ron Tan Aik Ti
Azman Hisham Bin Jaafar
NOMINATING COMMITTEE
Azman Hisham Bin Jaafar (Chairman)
Jimmy Fong Teck Loon
Ron Tan Aik Ti
Siow Chee Keong
REMUNERATION COMMITTEE
Ron Tan Aik Ti (Chairman)
Siow Chee Keong
Azman Hisham Bin Jaafar
REGISTERED OFFICE
37 Jalan Pemimpin
#07-04 Clarus Centre
Singapore 577177
Telephone: +65 6601 9100
Facsimile: +65 6601 9133
COMPANY SECRETARIES
Chew Kok Liang
Nathaniel Chelvarajah Vanniasingham
AUDITORS
BDO LLP
Public Accountants and
Certified Public Accountants
21 Merchant Road
#05-01, Royal Merukh S.E.A. Building
Singapore 058267
Partner-in-charge: Lew Wan Ming
(Appointed since financial year ended
30 June 2009)
SHARE REGISTRAR & SHARE
TRANSFER OFFICE
Boardroom Corporate & Advisory
Services Pte. Ltd.
50 Raffles Place
#32-01, Singapore Land Tower
Singapore 048623
Telephone: +65 6536 5355
Facsimile: +65 6536 1360
PRINCIPAL BANKERS
Oversea-Chinese Banking Corporation
Limited
Citibank, N.A., Singapore Branch
Standard Chartered Bank
corporate information
Be honest; keep to promise and
deliver as promised.
Be honest; keeBe honest; keep to promise aBe honest; keep to pBe honest; keep
integrity
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
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EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
16EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
SINGAPORE
Epicentre Holdings Limited
37 Jalan Pemimpin
#07-04 Clarus Centre
Singapore 577177
Telephone: +65 6601 9100
Facsimile: +65 6601 9133
Epicentre Pte. Ltd.
37 Jalan Pemimpin
#07-04 Clarus Centre
Singapore 577177
Telephone: +65 6601 9100
Facsimile: +65 6601 9133
group of companies
groupstructure
Epicentre Solutions Pte. Ltd.
37 Jalan Pemimpin
#07-04 Clarus Centre
Singapore 577177
Telephone: +65 6601 9100
Facsimile: +65 6601 9133
Epi Lifestyle Pte. Ltd.
37 Jalan Pemimpin
#07-04 Clarus Centre
Singapore 577177
Telephone: +65 6601 9100
Facsimile: +65 6601 9133
MALAYSIA
Epicentre Lifestyle Sdn. Bhd.
Central Plaza Suite 1706
17th Floor, 34 Jalan Sultan Ismail,
Kuala Lumpur, Malaysia
Telephone: +603 2141 1787
Facsimile: +603 2141 3787
CHINA
Epicentre (Shanghai) Co., Ltd.
Pudong District
No 488 Yao Hua Road
Unit 1801A Shanghai, China
Telephone: +86 21 3376 7500
Facsimile: +86 21 3376 7501
Epicentre Holdings Limited
Epicentre Pte. Ltd.
100%
Epicentre
Solutions Pte. Ltd.
100%
Epi Lifestyle
Pte. Ltd.
100%
Epicentre Lifestyle
Sdn. Bhd.
100%
Epicentre
(Shanghai) Co., Ltd.
70%
teamworkBe proactive to achieve
Company’s vision, mission & objective.
Trust in each other‘s professionalism.
corporate governance report
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
17
The Board of Directors (the “Board”) of Epicentre Holdings Limited (the “Company”) is committed to ensure that high standards
of corporate governance and transparency are practiced for the protection of shareholders’ interest.
This report outlines the corporate governance framework and practices of the Company with specific reference to the principles
and guidelines of the Singapore Code of Corporate Governance 2005 (the “Code”).
BOARD MATTERS
The Board’s conduct of its Affairs
Principle 1: Every company should be headed by an effective Board to lead and control the company. The Board is
collectively responsible for the success of the company. The Board works with Management to achieve
this and the Management remains accountable to the Board.
The Board oversees the business affairs of the Company. It carries out the function by assuming responsibility for effective
stewardship and corporate governance of the Company and the Group.
The primary role of the Board is to protect and enhance long-term shareholders’ value.
Generally, the responsibilities of the Board include:
• Set the corporate strategy and directions to the Group;
• Approve the policies, strategies and financial objectives of the Group;
• Establish and oversee the framework for internal controls and risk management and ensure good corporate
governance;
• Monitor the Board composition, Director selection and Board processes and performance;
• Review and monitor Executive Directors’ remuneration;
• Review business results including management performance, monitoring budgeting control and corrective actions (if
required);
• Approve annual budgets, major funding proposals, investment and divestment proposals; and
• Remove and appoint the Company Secretary.
Regular meetings are held to review the performance of the business and approve the public release of periodic financial
results. Ad-hoc meetings have been held to discuss certain matters as and when necessary.
Matters which specifically require Board approval are those involving material acquisitions and disposals of assets, corporate
or financial restructuring, dividends, share issuances and other shareholder matters.
Directors are updated regularly on key regulatory and accounting changes at Board meetings. Directors are encouraged to
undergo relevant training to enhance their skills and knowledge, especially on new laws and regulations affecting the Group’s
operations.
corporate governance report
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
18EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
Board Committees
The Board has formed Board Committees namely the Audit Committee (“AC”), the Nominating Committee (“NC”) and the
Remuneration Committee (“RC”) to assist in carrying out and discharging its duties and responsibilities efficiently and
effectively.
These Committees function within clearly defined terms of reference and operating procedures and are reviewed on a regular
basis. The effectiveness of each Committee is also constantly reviewed by the Board.
The Chairman explained to the new Directors their duties and obligations before they come on board. However, no formal
letters have been given to newly appointed Directors. For good governance, the Company intends to formalize the letters of
appointment.
The attendance of the Directors’ and various Board Committees’ held as well as the frequency of such meetings during the
financial year ended 30 June 2011 are as follows:
Board
Audit
Committee
Remuneration
Committee
Nominating
Committee
Number of meetings held 4 2 4 2
Name of Director Number of meetings attended
Jimmy Fong Teck Loon 4 2* 3* 2
Brenda Yeo 4 2* 3* 2*
Siow Chee Keong 4 2 4 2
Ron Tan Aik Ti 4 2 4 2
Lee Keen Whye(1) 1 1 1 1
Liu Zhipeng(2) 1 1 1 1
Azman Hisham Bin Jaafar(3) 3 1 2 1
* By invitation
(1) Resigned on 29 October 2010
(2) Resigned on 5 January 2011
(3) Appointed on 3 November 2010
Besides the attendance at meetings, the Board also measures the contribution of Directors in other forms including periodic
reviews, provision of guidance and advice on various matters relating to the Group on an ongoing basis.
corporate governance report
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
19
Board Composition and Balance
Principle 2: There should be a strong and independent element on the Board, which is able to exercise objective
judgment on corporate affairs independently, in particular, from Management. No individual or small
group of individuals should be allowed to dominate the Board’s decision making.
The Board comprises three Independent Directors and two Executive Directors and the members are as follows:
Executive Directors
Mr Jimmy Fong Teck Loon Executive Chairman and Chief Executive Officer
Ms Brenda Yeo Executive Director
Non-Executive Directors
Mr Siow Chee Keong Lead Independent Director
Mr Ron Tan Aik Ti Independent Director
Mr Azman Hisham Bin Jaafar Independent Director
The composition of the Board is reviewed on an annual basis by the NC to ensure that the Board has the appropriate mix of
expertise and experience, and collectively possess the necessary core competencies for effective functioning and informed
decision-making.
The criterion for independence is based on the definition given in the Code. The Board considers an “independent” Director as
one who has no relationship with the Company, its related companies or officers that could interfere, or be reasonably perceived
to interfere, with the exercise of the Director’s independent judgment of the conduct of the Group’s affairs.
As at current date, Independent Directors comprise more than one-third of the Board’s composition. The Board has undertaken
a full review of its composition. It is of the opinion that, with a significant majority of the Directors being Non-Executive and
Independent Directors, the Board continues to exercise objective judgment independently of the Management.
Key information regarding the Directors is given in the “Board of Directors” section of the annual report. Particulars of interests
of Directors who held office at the end of the financial year in shares, warrants and share options in the Company and in related
corporations are set out in the Directors’ Report on pages 31 to 32 of the annual report.
Non-Executive Directors meet regularly without Management present.
Non-Executive Directors are encouraged to constructively challenge and help to develop the management reporting framework
and review management performance.
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20EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
Chairman and Chief Executive Officer
Principle 3: There should be a clear division of responsibilities at the top of the company – the working of the Board
and the executive responsibility of the company’s business – which will ensure a balance of power and
authority, such that no one individual represents a considerable concentration of power.
The Board is of the view that it is in the best interests of the Group to adopt a single leadership structure, so as to ensure
the decision-making process of the Group would not be unnecessarily hindered. As such, the Board believes that there are
adequate safeguards in place against uneven concentration of power and authority in a single individual. The respective Board
Committees vet all major decisions made by the Chief Executive Officer (“CEO”).
Mr Jimmy Fong Teck Loon, is the Executive Chairman and CEO of the Company. As Chairman, he is primarily responsible for
overseeing the overall management and strategic development of the Company. He schedules Board meetings as and when
required and sets the agenda for the Board meetings. As the CEO, he formulates the policies and supervises the business
operations. He also sets guidelines and ensure the quality, quantity, accuracy, and the timelines of information flow between
the Board, Management and shareholders of the Company and also encourages the constructive relationship within the Board
between Executive and Non-Executive Directors, and between the Board and the Management.
The Company has also Mr Siow Chee Keong as its Lead Independent Director pursuant to the recommendation of the Code.
The Lead Independent Director serves as a principal liaison on Board issues between the Independent Directors and the
Chairman of the Board. The Lead Independent Director is available to shareholders who have concerns which contact through
the normal channels of the Chairman, CEO, Executive Directors or Chief Financial Officer have failed to resolve or for which
such contact is inappropriate.
The Chairman also assists to facilitate the effective contribution of Non-Executive Directors and promote high standard of
corporate governance taking into consideration of their expertise in different discipline.
Board Membership
Principle 4: There should be a formal and transparent process for the appointment of new directors to the
Board.
The NC comprises the following four members, three of whom are Independent Directors:
Mr Azman Hisham Bin Jaafar Chairman
Mr Jimmy Fong Teck Loon Member
Mr Siow Chee Keong Member
Mr Ron Tan Aik Ti Member
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21
The NC functions under the terms of reference which sets out its responsibilities as follows:
• To recommend to the Board on all new Board appointments, re-appointments and re-nominations;
• To ensure that Independent Directors meet the Code’s guidelines and criteria;
• To assess the effectiveness of the Board as a whole and the effectiveness and contribution of each Director to the Board;
and
• To ensure that the Directors with multiple board representation commit adequately in carrying out his/her duties
effectively.
The independence of each Director is reviewed annually by the NC based on the Code’s definition of what constitute an
Independent Director.
The Company has in place policies and procedures for the appointment of new Directors including the description on the
search and nomination process. For the selection and appointment of new Directors, the NC makes recommendation based
on merit, track records, experience, age, capabilities, industry knowledge and other pertinent criterion.
The Articles of Association of the Company require one-third of the Board to retire from office at each Annual General Meeting
(“AGM”). Accordingly, the Directors will submit themselves for re-nomination and re-election at regular intervals of at least once
every three years. It was also provided in the Articles of Association of the Company that the Directors appointed during the
course of the year must retire and submit themselves for re-election at the next AGM following their appointments.
Board Performance
Principle 5: There should be a formal assessment of the effectiveness of the Board as a whole and the contribution
by each director to the effectiveness of the Board.
The NC examines the Board’s size to satisfy that it is appropriate for effective decision making, taking into account the nature
and scope of the Company’s operations.
The NC has in place an evaluation process for each Director to evaluate the performance of the Board which would be
reviewed by the NC. The NC also put in place a peer review of individual Director’s performance. The evaluation exercise on the
performance of the Board and the peer review evaluation of individual Director’s performance in FY 2011 were conducted.
Through the evaluation process and the intensity of participation by Directors/members at the Board and Board Committees
meetings and their quality of contribution, the NC is satisfied that the Directors are able to continue contributing effectively.
Ms Brenda Yeo, Executive Director and Mr Azman Hisham Bin Jaafar, Non-Executive Independent Director are due to retire
at the forthcoming AGM in accordance with the Articles of Association of the Company. Arising from the NC’s evaluation of
the Board and individual Director’s performance which among other factors, includes their attendance at Board meetings
and contributions to the Company, the NC recommends to the Board the nomination of these Directors for re-election at the
forthcoming AGM.
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We noted that the performance evaluation should consider the performance of the Company’s share price over a five-year
period vis-à-vis the Singapore Straits Times Index. We did not adopt it and have instead bench mark the performance against
industry peers and adopt other criteria that include revenue growth year-on-year and gross margin as well as profit margin.
Access to Information
Principle 6: In order to fulfill their responsibilities, Board members should be provided with complete, adequate
and timely information prior to board meetings and on an on-going basis.
All Directors are from time to time furnished with information concerning the Company to enable them to be fully cognizant
of the decisions and actions of the Company’s executive management. The Board has unrestricted access to the Company’s
records and information.
Senior members of Management staff are available to provide explanatory information in the form of briefings to the Directors
or formal presentations in attendance at Board meetings, or by external consultants engaged on specific projects.
The Board has separate and independent access to the Company Secretaries and to other senior Management executives of
the Company and of the Group at all times in carrying out their duties.
The Company Secretaries or their representatives attend all Board and Board Committees meetings and ensure that Board
procedures are followed and that applicable rules and regulations are complied with. The minutes of all Board Committees’
meetings are circulated to the Board.
Each Director has the right to seek independent legal and other professional advice, at the Company’s expense, concerning
any aspect of the Group’s operations or undertakings in order to fulfill their duties and responsibilities as Directors.
REMUNERATION MATTERS
Procedures for Developing Remuneration Policies
Principle 7: There should be a formal and transparent procedure for developing policy on executive remuneration
and for fixing the remuneration packages of individual directors. No director should be involved in
deciding his own remuneration.
The RC comprises the following three members, all of whom are Independent Directors:
Mr Ron Tan Aik Ti Chairman
Mr Siow Chee Keong Member
Mr Azman Hisham Bin Jaafar Member
The RC recommends to the Board a framework of remuneration for the Directors and Executive Officers, and determine specific
remuneration package for each Executive Director. The recommendations are submitted for endorsement by the Board.
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23
All aspects of remuneration, including but not limited to Directors’ fees, salaries, allowances, bonuses and benefits in kind, are
covered by the RC. Each RC member will abstain from voting on any resolution in respect of his remuneration package.
The main functions of the RC are:
• Review and recommend to the Board, a framework of remuneration packages and terms of employment of the Executive
Directors and key executives of the Company;
• Determine the specific remuneration package of each Executive Director; and
• Review the appropriateness of remuneration package awarded to Non-Executive Directors.
The recommendations of the RC would be submitted to the Board for endorsement. The RC is provided with access to
expert professional advice on remuneration matters as and when necessary. The expense of such services is borne by the
Company.
Level and Mix of Remuneration
Principle 8: The level of remuneration should be appropriate to attract, retain and motivate the directors needed
to run the company successfully but companies should avoid paying more than is necessary for this
purpose. A significant proportion of executive directors’ remuneration should be structured so as to
link rewards to corporate and individual performance.
In setting the remuneration packages, the RC takes into consideration the remuneration and employment conditions within
similar industry and in comparable companies. As part of its review, the RC ensures that the performance related elements
of remuneration form a significant part of the total remuneration package of Executive Directors and is designed to align the
Directors’ interests with those of shareholders and link rewards to corporate and individual performance. The RC also reviews
all matters concerning the remuneration of Non-Executive Directors to ensure that the remuneration commensurate with the
contribution and responsibilities of the Directors.
The fee structure for Directors is assessed by the Board annually after benchmarking such fees against those in the public and
private sectors. The Company believes that the fees are competitive and its Directors are adequately compensated in line with
market norms.
None of the Non-Executive Directors has any service contracts with the Company and they receive remuneration by way of
Directors’ fees. These Directors’ fees are proposed by the Company as a lump sum to be approved by the shareholders at the
AGM.
The Executive Chairman and CEO had a service agreement which covers the terms of employment, salaries and other benefits.
It has a fixed term of five years with effect from 1 January 2011 and will continue for a further term of another five years unless
otherwise terminated by either party giving not less than 6 months’ notice in writing.
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There is no service contract for the Executive Director, Ms Brenda Yeo. The Company has appointed AON Hewitt Consulting to
review the remuneration packages of the senior Management and the Executive Directors and they are in the midst of doing
it.
The Company has an existing performance share plan, namely, Epicentre Holdings Limited Share Plan (the “Plan”) for the eligible
participants. The Plan will provide eligible participants with an opportunity to participate in the equity of the Company and
to increase the Company’s flexibility and effectiveness in its continuing efforts to reward, retain and motivate employees to
improve their performance.
Disclosure on Remuneration
Principle 9: Each company should provide clear disclosure of its remuneration policy, level and mix of remuneration,
and the procedure for setting remuneration, in the company’s annual report. It should provide
disclosure in relation to its remuneration policies to enable investors to understand the link between
remuneration paid to directors and key executives, and performance.
The details of the remuneration of Executive and Non-Executive Directors of the Company, disclosed in the relevant bands, for
services rendered during the financial year ended 30 June 2011 are as follows:
Remuneration Band
Fixed
Salary
Directors’
Fees
Performance Related
Income/Bonus Total
Above $750,000
Jimmy Fong Teck Loon 40% 2% 58% 100%
Between $250,000 to $500,000
Brenda Yeo 66% 7% 27% 100%
Below $250,000
Siow Chee Keong _ 100% – 100%
Ron Tan Aik Ti – 100% – 100%
Lee Keen Whye (resigned on 29 October 2010) _ 100% _ 100%
Liu Zhipeng (resigned on 5 January 2011) _ 100% _ 100%
Azman Hisham Bin Jaafar
(appointed on 3 November 2010) _ 100% _ 100%
The Code requires the disclosure of the remuneration of, at minimum, the top five executives who are not Directors and who
are within the remuneration band of $250,000. Given the highly competitive market the Company operates in, the names of
the top five executives are not disclosed.
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ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
25
The range of the gross remuneration of the top five key executives of the Group for the financial year ended 30 June 2011 is
shown below:
Remuneration Band Number of Key Executives
2011 2010
Below $250,000 5 5
Ms Brenda Yeo, Executive Director, is the spouse of Mr Jimmy Fong Teck Loon, Executive Chairman and the CEO as well as the
substantial shareholder.
Save as disclosed, no employee of the Group was an immediate family member of the Directors or Substantial Shareholders
whose remuneration has exceeded $150,000 during the financial year ended 30 June 2011.
ACCOUNTABILITY AND AUDIT
Accountability
Principle 10: The Board should present a balanced and understandable assessment of the company’s performance,
position and prospects.
The Board is accountable to the shareholders and is mindful of its obligations to furnish timely information and to ensure full
disclosure of material information to shareholders in compliance with statutory requirements and the Listing Manual, Section
B: Rules of Catalist of the Singapore Exchange Securities Trading Limited (the “SGX-ST”).
Price sensitive information is publicly released either before the Company meets with any group of investors or analysts or
simultaneously with such meetings. Financial results and annual reports are announced or issued within legally prescribed
periods.
In turn, Management of the Company provides the Board with balanced and understandable accounts of the Group’s
performance, financial position and business prospects on a quarterly basis.
Audit Committee
Principle 11: The Board should establish an Audit Committee with written terms of reference which clearly set
out its authority and duties.
The AC comprises the following three members, all of whom are Independent Directors:
Mr Siow Chee Keong Chairman
Mr Ron Tan Aik Ti Member
Mr Azman Hisham Bin Jaafar Member
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The AC meets regularly with the Group’s external and internal auditors and its Management to review accounting, auditing
and financial reporting matters so as to ensure that an effective system of control is maintained in the Group.
The AC also monitors proposed changes in accounting policies, reviews the internal audit functions and discusses the
accounting implications of major transactions. In addition, it advises the Board regarding the adequacy of the Group’s internal
controls and the contents and presentation of its reports.
The Board considers that the members of the AC are appropriately qualified to fulfil their responsibilities as the members bring
with them invaluable managerial and professional expertise in the financial, legal and industry domain.
The AC functions under the terms of reference which sets out its responsibilities as follows:
• Review the audit plans of the external and internal auditors;
• Review the auditors’ reports and evaluate the Company’s and the Group’s system of internal controls;
• Review the effectiveness and adequacy of internal audit function which is outsourced to a professional firm;
• Review the co-operation given by the Company’s officers to the internal and external auditors;
• Review the financial statements of the Company’s and the Group before submission to the Board; and
• Nominate and review the appointment or re-appointment of external and internal auditors.
The AC has the power to conduct or authorise investigations into any matters within the AC’s scope of responsibility, which has
or is likely to have material impact on the Group’s operating and financial results. The AC is authorised to obtain independent
professional advice if it deems necessary in the discharge of its responsibilities. Such expenses are borne by the Company. Each
member of the AC abstains from voting any resolutions in respect of matters he is interested in.
The AC has full access to and co-operation of the Management and has full discretion to invite any Director or Executive Officer
to attend its meetings, and has been given reasonable resources to enable it to discharge its functions.
The AC meets with the external and internal auditors, separately without the presence of Management, at least once a year.
The AC reviews the independence of the external auditors annually. The AC, having reviewed the range and value of non-audit
services rendered by the external auditor, Messrs BDO LLP, was satisfied that the nature and extent of such services will not
prejudice the independence and objectivity of the external auditors. The AC recommended that Messrs BDO LLP be nominated
for re-appointment as auditors of the Company at the forthcoming AGM.
The Company confirms that it is in compliance with Rules 712, 715 and 716 of the Listing Manual Section B: Rules of Catalist
of the SGX-ST as the Company and its Singapore’s subsidiaries are audited by Messrs BDO LLP whilst its Malaysian subsidiary
is audited by BDO Malaysia.
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27
In July 2010, the Singapore Exchange Limited and Accounting and Corporate Regulatory Authority had launched the “Guidance
to Audit Committees on Evaluation of Quality of Work performed by External Auditors” which aims to facilitate the AC in
evaluating the external auditors. Accordingly, the AC had evaluated the performance of the external auditors based on the
key indicators of audit quality set out in the guidance.
The Company has in place a whistle blowing framework, endorsed by the AC where employees of the Company may, in
confidence, raise concerns about possible corporate improprieties in matters of financial reporting or other matters and to
ensure that arrangements are in place for the independent investigations of such matters and for appropriate follow up actions.
The details of the whistle blowing policies and arrangements have been made available to all employees. As at the date of this
report, there was no report received through the whistle blowing mechanism.
Internal Controls
Principle 12: The Board should ensure that Management maintains a sound system of internal controls to safeguard
the shareholders’ investments and the company’s assets.
The Board ensures that the Management maintains a sound system of internal controls and effective risk management policies
to safeguard the shareholders’ investment and the Company’s assets and in this regard, is assisted by the AC which conducts
the reviews.
The AC ensures that a review of the adequacy and effectiveness of the Company’s internal controls, including financial,
operational and compliance controls and risk assessment, is conducted by the external auditors at least once a year to ensure
the adequacy thereof. The AC reviews the audit plans, and the findings of the auditors and ensures that the Company follows
up on the auditors’ recommendations raised, if any, during the audit process. Any material non-compliance or failures in internal
controls and recommendations for improvements are reported to the AC. The AC also reviews the effectiveness of the actions
taken by the Management on the recommendations made by the external auditors in this respect.
The Company has in place a system of internal control and risk management, the effectiveness of which are reviewed periodically
within the financial year of the Company, for ensuring proper accounting records and reliable financial information as well as
management of business risks with a view of safeguarding shareholders’ investments and the Company’s assets.
However, the Board notes that no system of internal controls could provide absolute assurance against the occurrence of
material errors, poor judgment in decision-making, human error, losses, fraud or other irregularities.
The Board with the concurrence of the AC is satisfied that there are adequate internal controls in place to address the financial,
operational and compliance risks with reasonable assurance. The Company has engaged the services of Ernst and Young
Advisory Pte. Ltd. as its internal auditor to review that these controls are in place.
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Internal Audit
Principle 13: The Company should establish an internal audit function that is independent of the activities it
audits.
The Company has outsourced the internal audit functions of the Group to Ernst and Young Advisory Pte. Ltd. a professional
accounting firm providing internal audit, risk and compliance services. The internal auditors report directly to the AC on all
internal audit matters though administratively, the internal auditor liaises with the Chief Financial Officer.
The internal auditors are responsible for evaluating the reliability, adequacy and effectiveness of the internal controls and risk
management processes of the Group, assisting the AC in the review of interested person transactions and ensuring that the
internal controls of the Group is adequate in proper recording of transactions and safeguarding the assets of the Group. The
internal auditors will also carry out major internal control checks and compliance tests as instructed by the AC. The AC will
review the internal auditors’ reports and ensure that there are adequate internal controls within the Group.
The AC, on an annual basis, will assess the effectiveness of the internal audit by examining the scope of the internal audit work
and its independence, the internal auditors’ reports and its relationship with the external auditors to ensure that the internal
auditors has the necessary resources to adequately perform its functions.
The AC will ensure that the internal auditors meet or exceed the standards set by recognised professional bodies including the
Standards for the Professional Practice of Internal Auditing set by the Institute of Internal Auditors.
Communications with Shareholders
Principle 14: Companies should engage in regular, effective and fair communication with shareholders.
Principle 15: Companies should encourage greater shareholder participation at AGMs, and allow shareholders
the opportunity to communicate their views on various matters affecting the company.
In line with continuous obligations of the Company under the Listing Manual, Section B: Rules of Catalist of the SGX-ST, the
Board’s policy is that all shareholders be informed of all major developments that impact the Group.
The Company believes that a high standard of disclosure is keys to raising the level of corporate governance. Interim and
full year results and news releases are published through the SGXNet. All information of the Company’s new initiatives is first
disseminated via SGXNet followed by a news release.
A copy of the Annual Report is sent to every shareholder. The Notice of AGM is advertised in the press and released via SGXNet.
Separate resolutions on each distinct issue are proposed at general meetings for approval.
In accordance with the Articles of Association of the Company, shareholders may appoint one or two proxies to attend and
vote at general meetings in their absence. All shareholders are allowed to vote in person or by proxy. Central Provident Fund
investors of the Company’s securities may attend shareholders’ meetings as observers provided they have submitted to do so
with the agent banks within the specified time frame.
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Shareholders are encouraged to attend the general meetings to ensure a high level of accountability and to stay apprised of
the Group’s strategy and goals. At general meetings of the Company, shareholders are given the opportunity to air their views
and ask the Directors and Management questions regarding the Group and its businesses. The Chairmen of the AC, NC and RC
are normally available at the meetings to answer any question relating to the work of these Committees. The external auditors
are also present to assist the Board in addressing any relevant queries by the shareholders.
DEALINGS IN SECURITIES
The Company is guided by Rule 1204(19) of the Listing Manual Section B: Rules of Catalist of the SGX-ST in relation to the
dealings in securities of the Company to its Directors and Management.
The Company has in place a policy to prohibit the Directors, key executives and employees who have access to unpublished
material price sensitive information from dealing in Company’s securities. They are advised not to deal in the Company’s
securities for the period of one month immediately preceding the announcement of the Company’s half year financial results
and full year financial results and ending on the date of announcement of such results on the SGX-ST, or when they are in
possession of the unpublished price sensitive information of the Group. In addition, the Directors, key executives and employees
are expected to observe insider trading laws at all times even when dealing in securities within the permitted trading period.
They are also discouraged from dealing in the Company’s shares on short term considerations.
INTERESTED PERSON TRANSACTIONS
The Company has established internal control policy to ensure that transactions with interested persons are properly reviewed,
approved and conducted at arm’s length basis.
The following is the aggregate value of all transactions with interested persons (as defined in Chapter 9 of the Listing Manual
Section B: Rules of Catalist of the SGX-ST) for the financial year ended 30 June 2011:
Name of interested person Aggregate value of all interested
person transactions during the
financial year under review
(excluding transactions conducted
under shareholders’ mandate
pursuant to Rule 920)
S$
Aggregate value of all interested
person transactions conducted
under shareholders’ mandate
pursuant to Rule 920
(excluding transactions
less than $100,000)
S$
– – –
MATERIAL CONTRACTS
There are no material contracts to which the Company or any of its subsidiary, is a party and which involve the interests of
the CEO, any Director or the controlling shareholder, were subsisting at the end of the financial year ended 30 June 2011 or
entered into since the date of listing of the Company.
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RISK MANAGEMENT
The Board, through its AC, manages the risk profile of the Company. In line with this, it has requested the Chief Financial
Officer to highlight key risk areas of the Group’s various businesses and review risk treatments on a regular basis. In addition,
the internal auditors are engaged to develop a risk-based internal audit plan to review financial, operational and compliance
risks across the Group.
Business Risk
The Group is primarily engaged in retailing of Apple branded and proprietary brands of electronics consumer products. Its
revenue is affected by economic sentiment, consumer spending and market acceptance of the newly launched products in
various geographical regions in which the Group operates. In view of this, SWOT analysis is used to regularly review the ongoing
viability of our retail network and how market share may be maintained/increased.
Financial Risk
The Group maintains sufficient cash reserves to meet its obligations as and when it falls due. The bulk of the Group’s purchases
are denominated in US Dollar. In order to minimize the Group’s exposure to foreign currency fluctuation, it engages in foreign
currency hedging based on purchase commitments.
CATALIST SPONSOR
No non-sponsored fee was paid to the Sponsor during the financial year ended 30 June 2011.
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ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
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The Directors of the Company present their report to the members together with the audited financial statements of the Group
for the financial year ended 30 June 2011 and the statement of financial position of the Company as at 30 June 2011.
1. Directors
The Directors of the Company in office at the date of this report are:
Jimmy Fong Teck Loon
Brenda Yeo
Siow Chee Keong
Ron Tan Aik Ti
Azman Hisham Bin Jaafar (Appointed on 3 November 2010)
2. Arrangements to enable Directors to acquire shares or debentures
Neither at the end of nor at any time during the financial year was the Company a party to any arrangement whose
object is to enable the Directors of the Company to acquire benefits by means of the acquisition of shares in or
debentures of the Company or any other body corporate.
3. Directors’ interests in shares or debentures
According to the Register of Directors’ Shareholdings kept by the Company for the purpose of Section 164 of the
Singapore Companies Act, Cap. 50 (the “Act”), none of the Directors of the Company who held office at the beginning
and end of the financial year had any interests in the shares or debentures of the Company or its related corporations
except as detailed below:
Shareholdings registered
in the name of Directors
Shareholdings in which Directors
are deemed to have an interest
Balance at
1 July 2010
Balance at
30 June 2011
Balance at
1 July 2010
Balance at
30 June 2011
Number of ordinary shares
Company
Jimmy Fong Teck Loon 50,369,800 50,369,800 630,000 630,000
Brenda Yeo 630,000 630,000 50,369,800 50,369,800
Siow Chee Keong 100,000 100,000 – –
Lee Keen Whye
(resigned on 29 October 2010) 100,000 100,000 – –
Lui Zhipeng
(resigned on 5 January 2011) 100,000 100,000 – –
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32EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
3. Directors’ interests in shares or debentures (Continued)
By virtue of Section 7 of the Act, Jimmy Fong Teck Loon and Brenda Yeo are deemed to have interests in the shares of
all the subsidiaries of the Company as at the end of the financial year. Jimmy Fong Teck Loon is deemed to be interested
in the shares held by his wife, Brenda Yeo, and vice versa.
In accordance with the continuing listing requirements of the Singapore Exchange Securities Trading Limited (“SGX-ST”),
the Directors of the Company state that, according to the Register of Directors’ Shareholdings, the Directors’ interests
as at 21 July 2011 in the shares of the Company have not changed from those disclosed as at 30 June 2011.
4. Directors’ contractual benefits
Since the end of the previous financial year, no Director of the Company has received or become entitled to receive a
benefit which is required to be disclosed under 201(8) of the Act, by reason of a contract made by the Company or by
a related corporation with the Director of the Company or with a firm of which he is a member, or with a company in
which he has a substantial financial interest, except as disclosed in the financial statements.
5. Share options
At the Extraordinary General Meeting held on 29 June 2010, the shareholders of the Company approved the Epicentre
Holdings Limited Performance Share Plan (the “Scheme”). In relation to the Scheme, the Company will grant shares of
the Company (“Awards”) to eligible Group employees and Non-Executive Directors (“Participants”). Awards represent the
right of a Participant to receive fully paid ordinary shares of the Company (“Shares”) free of charge, upon the Participant
achieving prescribed performance targets. Awards may only be vested and consequently any Shares comprised in such
Awards shall only be delivered upon the Committee’s (as defined below) satisfaction that the prescribed performance
targets have been achieved.
Awards may be granted at any time in the course of a financial year provided that in the event that an announcement
on any matter of any exceptional nature involving unpublished price sensitive information is imminent. Awards may
only be vested and hence any Shares comprised in such Awards may only be delivered on or after the second market
day from the date on which the aforesaid announcement is made.
The Scheme is administered by the Remuneration Committee.
There were no share options granted by the Company or its subsidiaries during the financial year under the scheme.
There were no shares issued during the financial year by virtue of the exercise of options to take up unissued shares
of the Company or its subsidiaries.
There were no unissued shares of the Company or its subsidiaries under options as at the end of the financial year
under the scheme.
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6. Audit committee
The Audit Committee comprises the following members, who are all Non-Executive Directors and Independent Directors.
The members of the Audit Committee during the financial year and at the date of this report are:
Siow Chee Keong (Chairman)
Ron Tan Aik Ti
Azman Hisham Bin Jaafar
The Audit Committee performs the functions specified in Section 201B (5) of the Act. In performing those functions, the
Audit Committee reviewed the audit plans and the overall scope of examination by the external and internal auditors
of the Group and of the Company. The Audit Committee also reviewed the independence of the external and internal
auditors of the Company and the nature and extent of the non-audit services provided by the external auditors.
The Audit Committee also reviewed the assistance provided by the Company’s officers to the external auditors and the
consolidated financial statements and the statement of financial position of the Company as well as the Independent
Auditors’ Report thereon prior to their submission to the Directors of the Company for adoption and reviewed the
interested person transactions as defined in Chapter 9 of the Listing Manual Section B: Rules of Catalist of the SGX-ST.
The Audit Committee has full access to and has the co-operation of the management and has been given the resources
required for it to discharge its function properly. It has also full discretion to invite any Director and executive officer to
attend its meetings. The external and internal auditors have unrestricted access to the Audit Committee.
The Audit Committee has recommended to the Board of Directors the nomination of Messrs BDO LLP, for re-appointment
as auditors of the Company at the forthcoming Annual General Meeting. The Audit Committee has carried out an
annual review of non-audit services provided by the external auditors to satisfy itself that the nature and extent of
such services will not prejudice the independence and objectivity of the external auditors prior to recommending their
recommendation.
7. Auditors
The auditors, Messrs BDO LLP, have expressed their willingness to accept re-appointment.
On behalf of the Board of Directors
Jimmy Fong Teck Loon Brenda Yeo
Director Director
Singapore
22 September 2011
statement by directors
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
34EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
In the opinion of the Board of Directors,
(a) the accompanying financial statements comprising the statements of financial position of the Group and of the
Company, consolidated statement of comprehensive income, consolidated statement of changes in equity and
consolidated statement of cash flows together with the notes thereon are properly drawn up in accordance with the
provisions of the Singapore Companies Act, Cap. 50 and Singapore Financial Reporting Standards so as to give a true
and fair view of the state of affairs of the Group and of the Company as at 30 June 2011 and of the results, changes in
equity and cash flows of the Group for the financial year ended on that date; and
(b) at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts
as and when they fall due.
On behalf of the Board of Directors
Jimmy Fong Teck Loon Brenda Yeo
Director Director
Singapore
22 September 2011
independent auditors’ report
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
35
TO THE MEMBERS OF EPICENTRE HOLDINGS LIMITED
Report on the financial statements
We have audited the accompanying financial statements of Epicentre Holdings Limited (the “Company”) and its subsidiaries
(the “Group”) which comprise the statements of financial position of the Group and of the Company as at 30 June 2011, the
consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement
of cash flows for the financial year then ended, and a summary of significant accounting policies and other explanatory
information, as set out on pages 37 to 89.
Management’s responsibility for the financial statements
Management is responsible for the preparation of financial statements that give a true and fair view in accordance with
the provisions of the Singapore Companies Act, Cap. 50 (the “Act”) and Singapore Financial Reporting Standards, and for
devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets
are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are
recorded as necessary to permit the preparation of true and fair profit and loss accounts and balance sheets and to maintain
accountability of assets.
Auditors’ responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in
accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and
plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.
The procedures selected depend on the auditors’ judgement, including the assessment of the risks of material misstatement of
the financial statements, whether due to fraud or error. In making those risk assessments, the auditors consider internal control
relevant to the entity’s preparation of financial statements that give a true and fair view in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s
internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
independent auditors’ report
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
36EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
TO THE MEMBERS OF EPICENTRE HOLDINGS LIMITED
Report on the financial statements (Continued)
Opinion
In our opinion, the accompanying financial statements of the Group and the statement of financial position of the Company
are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to give
a true and fair view of the state of affairs of the Group and of the Company as at 30 June 2011 and of the results, changes in
equity and cash flows of the Group for the financial year ended on that date.
Report on other legal and regulatory requirements
In our opinion, the accounting and other records required by the Act to be kept by the Company and by those subsidiaries
incorporated in Singapore of which we are the auditors, have been properly kept in accordance with the provisions of the
Act.
BDO LLP
Public Accountants and
Certified Public Accountants
Singapore
22 September 2011
statements of fi nancial position
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
37
AS AT 30 JUNE 2011
Group Company
Note 2011 2010 2011 2010
$’000 $’000 $’000 $’000
Non-current assets
Club membership 4 223 – 223 –
Plant and equipment 5 2,510 1,860 900 146
Investments in subsidiaries 6 – – 1,120 980
2,733 1,860 2,243 1,126
Current assets
Inventories 7 10,137 8,065 – –
Trade and other receivables 8 5,841 5,943 6,496 9,645
Prepayments 493 387 76 219
Derivative financial instruments 9 – 45 – 45
Cash and cash equivalents 10 14,870 10,994 3,124 3,492
31,341 25,434 9,696 13,401
Less:
Current liabilities
Trade and other payables 11 12,967 8,733 450 579
Provisions 12 135 139 50 54
Derivative financial instruments 9 14 – 6 –
Finance lease payables 13 35 6 35 6
Current income tax payable 913 575 – 9
14,064 9,453 541 648
Net current assets 17,277 15,981 9,155 12,753
Less:
Non-current liabilities
Finance lease payables 13 200 1 200 1
Deferred tax liabilities 14 78 78 15 15
278 79 215 16
19,732 17,762 11,183 13,863
Equity
Share capital 15 6,709 6,709 6,709 6,709
Foreign currency translation
(account)/reserve 16 (2) 26 – –
Retained earnings 12,989 11,027 4,474 7,154
Equity attributable to owners
of the parent 19,696 17,762 11,183 13,863
Non-controlling interest 36 – – –
Total equity 19,732 17,762 11,183 13,863
The accompanying notes form an integral part of these financial statements.
consolidated statement of comprehensive income
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
38EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
. Note 2011 2010
$’000 $’000
Revenue 17 162,603 88,082
Cost of sales (138,397) (73,768)
Gross profit 24,206 14,314
Other items of income
Interest income 13 14
Other income 18 1,365 1,395
Other items of expense
Administrative expenses (15,313) (8,776)
Selling and distribution costs (4,541) (2,850)
Profit before income tax 19 5,730 4,097
Income tax expense 20 (983) (709)
Profit for the financial year 4,747 3,388
Other comprehensive income
Foreign currency differences on translation of foreign operations (30) 23
Income tax relating to components of other comprehensive income – –
Other comprehensive income for the financial year, net of tax (30) 23
Total comprehensive income for the financial year 4,717 3,411
Profit attributable to:
Owners of the parent 4,767 3,388
Non-controlling interest (20) –
4,747 3,388
Total comprehensive income attributable to:
Owners of the parent 4,739 3,411
Non-controlling interest (22) –
4,717 3,411
Earnings per share (in cents)
– Basic and diluted 21 5.10 3.62
The accompanying notes form an integral part of these financial statements.
consolidated statement of changes in equity
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
39
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
Group Note
Share
capital
Foreign
currency
translation
(account)/
reserve
Retained
earnings
Equity
attributable
to owners
of the
parent
Non-
controlling
interest
Total
equity
$’000 $’000 $’000 $’000 $’000 $’000
Balance at 1 July 2010 6,709 26 11,027 17,762 – 17,762
Profit for the financial year – – 4,767 4,767 (20) 4,747
Other comprehensive income
for the financial year
Foreign currency differences
on translation of foreign
operations, net of tax – (28) – (28) (2) (30)
Total comprehensive income
for the financial year – (28) 4,767 4,739 (22) 4,717
Distribution to owners
of the parent
Dividends 22 – – (2,805) (2,805) – (2,805)
Transactions with the
non-controlling interest
Attributable to incorporation
of a subsidiary – – – – 58 58
Balance at 30 June 2011 6,709 (2) 12,989 19,696 36 19,732
Balance at 1 July 2009 6,709 3 7,639 14,351 – 14,351
Profit for the financial year – – 3,388 3,388 – 3,388
Other comprehensive income
for the financial year
Foreign currency differences
on translation of foreign
operations, net of tax – 23 – 23 – 23
Total comprehensive income
for the financial year – 23 3,388 3,411 – 3,411
Balance at 30 June 2010 6,709 26 11,027 17,762 – 17,762
The accompanying notes form an integral part of these financial statements.
consolidated statement of cash fl ows
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
40EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
Note 2011 2010
$’000 $’000
Operating activities
Profit before income tax 5,730 4,097
Adjustments for:
Allowance for inventory obsolescence 31 –
Bad third parties trade receivables written off 23 –
Changes in value of derivative financial instruments 59 –
Depreciation of plant and equipment 996 596
Interest income (13) (14)
Loss on disposals of plant and equipment 1 –
Inventories written off 72 53
Plant and equipment written off 4 –
Write-back of allowance for doubtful third parties trade receivables – (7)
Reversal of provision for reinstatement cost unutilised (30) –
Operating cash flows before working capital changes 6,873 4,725
Working capital changes:
Inventories (2,290) (2,926)
Trade and other receivables 56 (2,365)
Prepayments (108) (122)
Trade and other payables 4,279 1,502
Cash generated from operations 8,810 814
Interest received 13 14
Income taxes paid (644) (399)
Net cash from operating activities 8,179 429
Investing activities
Purchase of club membership (223) –
Purchase of plant and equipment (1,286) (1,896)
Issue of shares to non-controlling interest 58 –
Net cash used in investing activities (1,451) (1,896)
Financing activities
Dividends paid (2,805) –
Decrease in fixed deposits pledged 1,713 585
Repayment of finance lease payables (16) (6)
Net cash (used in)/from financing activities (1,108) 579
Net change in cash and cash equivalents 5,620 (888)
Cash and cash equivalents at beginning of financial year 9,281 10,139
Effects of exchange rate changes on cash and cash equivalents (31) 30
Cash and cash equivalents at end of financial year 10 14,870 9,281
The accompanying notes form an integral part of these financial statements.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
41
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
These notes form an integral part of and should be read in conjunction with the financial statements.
1. General corporate information
The consolidated financial statements of the Group and the statement of financial position of the Company for
the financial year ended 30 June 2011 were authorised for issue in accordance with a Directors’ resolution dated
22 September 2011.
The Company is a public limited company, incorporated and domiciled in Singapore. The principal place of business
and registered office is at 37 Jalan Pemimpin #07-04 Clarus Centre, Singapore 577177. The Company’s registration
number is 200202930G.
The principal activity of the Company is that of investment holding.
The principal activities of the subsidiaries are set out in Note 6 to the financial statements.
2. Summary of significant accounting policies
2.1 Basis of preparation of financial statements
The financial statements have been prepared in accordance with the provisions of the Singapore Companies
Act, Cap. 50 and Singapore Financial Reporting Standards (“FRS”). The financial statements are presented in
Singapore dollar and all values are rounded to the nearest thousand ($’000) except when otherwise indicated.
The financial statements have been prepared under the historical cost convention, except as disclosed in the
accounting policies below.
The preparation of financial statements in conformity with FRS requires the management to exercise judgement
in the process of applying the Group’s and the Company’s accounting policies and requires the use of accounting
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent
assets and liabilities at the end of the reporting period, and the reported amounts of revenue and expenses
during the financial year. Although these estimates are based on the management’s best knowledge of historical
experience and other factors, including expectations of future events that are believed to be reasonable under
the circumstances, actual results may ultimately differ from those estimates. The estimates and underlying
assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the financial
year in which the estimate is revised if the revision affects only that financial year, or in the financial year of the
revision and future financial years if the revision affects both current and future financial years.
Critical accounting judgements and key sources of estimation uncertainty used that are significant to the financial
statements are disclosed in Note 3 to the financial statements.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
42EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.1 Basis of preparation of financial statements (Continued)
During the financial year, the Group and the Company adopted the new or revised FRS and Interpretations of
FRS (“INT FRS”) that are relevant to their operations and effective for the current financial year. Changes to the
Group’s and the Company’s accounting policies have been made as required in accordance with the relevant
transitional provisions in the respective FRS and INT FRS. The adoption of the new or revised FRS and INT FRS
did not result in any substantial changes to the Group’s and the Company’s accounting policies and has no
material effect on the amounts reported for the current and prior financial years.
FRS and INT FRS issued but not yet effective
As at the date of the authorisation of these financial statements, the Group and the Company have not adopted
the following FRS and INT FRS that have been issued but not yet effective:
Effective date
(Annual periods
beginning on or after)
FRS 1 : Am endments to FRS 1 – Presentation of Items of Other
Comprehensive Income *
1 July 2012
FRS 12 : Am endments to FRS 12 – Deferred Tax: Recovery of Underlying
Assets
1 January 2012
FRS 19 : Employee Benefits (Revised) * 1 January 2013
FRS 24 : Related Party Disclosures (Revised) 1 January 2011
FRS 27 : Separate Financial Statements * 1 January 2013
FRS 28 : Investments in Associates and Joint Ventures * 1 January 2013
FRS 101 : Am endments to FRS 101 – Severe Hyperinflation and Removal of
Fixed Dates for First-time Adopters
1 July 2011
FRS 107 : Am endments to FRS 107 Disclosures – Transfers of Financial
Assets
1 July 2011
FRS 110 : Consolidated Financial Statements * 1 January 2013
FRS 111 : Joint Arrangements * 1 January 2013
FRS 112 : Disclosure of Interests in Other Entities * 1 January 2013
FRS 113 : Fair Value Measurement * 1 January 2013
INT FRS 114 : Am endments to INT FRS 114 – Prepayments of a Minimum
Funding Requirement
1 January 2011
INT FRS 115 : Agreements for the Construction of Real Estate 1 January 2011
Singapore Financial Reporting Standards for Small Entities 1 January 2011
* Issued on 20 September 2011
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
43
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.1 Basis of preparation of financial statements (Continued)
Consequential amendments were also made to various standards as a result of these new or revised
standards.
The Group and the Company expect that the adoption of the above FRS and INT FRS, if applicable, will have no
material impact on the financial statements in the period of initial adoption, except as discussed below.
FRS 24 (2010) Related Party Disclosures
FRS 24 (2010) changes certain requirements for related party disclosures for entities under control, joint control
or significant influence of a government (“government-related entities”). FRS 24 (2010) also made related party
relations symmetrical between each of the related parties and new relationships were included and clarified in the
definition of a related party. The Group and the Company will apply the amendments to FRS 24 retrospectively
for annual periods beginning on 1 July 2011 and is currently determining the impact of the changes to the
definition of a related party on the related disclosures. As this is a disclosure standard, it will have no impact on
the financial position or financial performance of the Group and the Company when implemented.
On 20 September 2011, the Accounting Standards Council has issued certain new and revised FRS. The Group
and the Company are currently determining the impact of these new and revised FRS on the financial statements
upon initial adoption.
2.2 Basis of consolidation
The consolidated financial statements comprise the financial statements of the Company and its subsidiaries.
Subsidiaries are entities over which the Company has the power to govern the financial operating policies,
generally accompanied by a shareholding giving rise to the majority of the voting rights, as to obtain benefits
from their activities.
Subsidiaries are consolidated from the date on which control is transferred to the Group up to the effective
date on which control ceases.
Intra-group balances and transactions and any unrealised gains and losses arising from intra-group transactions
are eliminated on consolidation.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
44EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.2 Basis of consolidation (Continued)
The financial statements of the subsidiaries are prepared for the same reporting period as that of the Company,
using consistent accounting policies. Where necessary, accounting policies of subsidiaries are changed to ensure
consistency with the policies adopted by other members of the Group.
Non-controlling interests in subsidiaries are identified separately from the Group’s equity therein. Non-controlling
interests in the acquiree may be initially measured either at fair value or at the non-controlling interests’
proportionate share of the fair value of the acquiree’s identifiable net assets. The choice of measurement
basis is made on an acquisition-by-acquisition basis. Subsequent to acquisition, the carrying amount of non-
controlling interests is the amount of those interests at initial recognition plus the non-controlling interests’
share of subsequent changes in equity. Total comprehensive income is attributed to non-controlling interests
even if this results in the non-controlling interests having a deficit balance.
Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as equity
transactions. The carrying amounts of the Group’s interests and the non-controlling interests are adjusted to
reflect the changes in their relative interests in the subsidiary. Any difference between the amount by which
the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised
directly in equity and attributed to owners of the parent.
When the Group loses control of a subsidiary, the profit or loss on disposal is calculated as the difference
between (i) the aggregate of the fair value of the consideration received and the fair value of any retained
interest and (ii) the previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary
and any non-controlling interests. Amounts previously recognised in other comprehensive income in relation
to the subsidiary are accounted for (i.e. reclassified to profit or loss or transferred directly to retained earnings)
in the same manner as would be required if the relevant assets or liabilities were disposed of. The fair value of
any investment retained in the former subsidiary at the date when control is lost is regarded as the fair value on
initial recognition for subsequent accounting under FRS 39 Financial Instruments: Recognition and Measurement or,
when applicable, the cost on initial recognition of an investment in an associate or jointly controlled entity.
Investments in subsidiaries are carried at cost less any impairment loss in the Company’s statement of financial
position.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
45
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.3 Business combinations
Business combinations from 1 July 2010
The acquisition of subsidiaries is accounted for using the acquisition method. The cost of the acquisition is
measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or
assumed, and equity instruments issued by the Group in exchange for control of the acquiree. Acquisition-related
costs are recognised in profit or loss as incurred.
Where applicable, the consideration for the acquisition includes any asset or liability resulting from a contingent
consideration arrangement, measured at its acquisition-date fair value. Subsequent changes in such fair values
are adjusted against the cost of acquisition where they qualify as measurement period adjustments (see below).
All other subsequent changes in the fair value of contingent consideration classified as an asset or liability are
accounted for in accordance with relevant FRS. Changes in the fair value of contingent consideration classified
as equity are not recognised.
The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition
under FRS 103 are recognised at their fair values at 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 the lower of cost and fair value less costs
to sell.
Where a business combination is achieved in stages, the Group’s previously held interests in the acquired entity
are re-measured to fair value at the acquisition date (i.e. the date the Group attains control) and the resulting
gain or loss, if any, is recognised in profit or loss. Amounts arising from interests in the acquiree prior to the
acquisition date that have previously been recognised in other comprehensive income are reclassified to profit
or loss, where such treatment would be appropriate if that interest were disposed of.
The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition
under FRS 103 are recognised at their fair value at the acquisition date, except that:
• deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements
are recognised and measured in accordance with FRS 12 Income Taxes and FRS 19 Employee Benefits
respectively;
• liabilities or equity instruments related to the replacement by the Group of an acquiree’s share-based
payment awards are measured in accordance with FRS 102 Share-based Payment; and
• 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 are measured in accordance with that Standard.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
46EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.3 Business combinations (Continued)
Business combinations from 1 July 2010 (Continued)
If the initial accounting for a business combination is incomplete by the end of the reporting period in which the
combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete.
Those provisional amounts are adjusted during the measurement period (see below), or additional assets or
liabilities are recognised, to reflect new information obtained about facts and circumstances that existed as of
the acquisition date that, if known, would have affected the amounts recognised as of that date.
The measurement period is the period from the date of acquisition to the date the Group obtains complete
information about facts and circumstances that existed as of the acquisition date, and is subject to a maximum
of one year.
Goodwill arising on acquisition is recognised as an asset at the acquisition date and initially measured at cost,
being the excess of the sum of the consideration transferred, the amount of any non-controlling interest in the
acquiree and the fair value of the acquirer previously held equity interest (if any) in the entity over net acquisition-
date fair value amounts of the identifiable assets acquired and the liabilities assumed.
If, after reassessment, the Group’s interest in the net fair value of the acquiree’s identifiable net assets exceeds
the sum of the consideration transferred, the amount of any non-controlling interest in the acquiree and the
fair value of the acquirer’s previously held equity interest in the acquiree (if any), the excess is recognised
immediately in profit or loss as a bargain purchase gain.
Business combinations before 1 July 2010
In comparison to the above mentioned requirements, the following differences applied:
Business combinations are accounted for by applying the purchase method. Transaction costs directly
attributable to the acquisition formed part of the acquisition costs. The non-controlling interest (formerly known
as minority interest) was measured at the proportionate share of the acquiree’s identifiable net assets.
Business combinations achieved in stages were accounted for as separate steps. Adjustments to those fair values
relating to previously held interests are treated as a revaluation and recognised in equity.
When the Group acquired a business, embedded derivatives separated from the host contract by the acquiree are
not reassessed on acquisition unless the business combination results in a change in the terms of the contract
that significantly modifies the cash flows that would otherwise be required under the contract.
Contingent consideration was recognised if, and only if, the Group had a present obligation, the economic
outflow was probable and a reliable estimate was determinable. Subsequent measurements to the contingent
consideration affected goodwill.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
47
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.4 Plant and equipment
Plant and equipment are initially stated at cost. Subsequent to initial recognition, plant and equipment are stated
at cost less accumulated depreciation and any accumulated impairment losses. The cost of plant and equipment
includes its purchase price and any costs directly attributable to bringing the asset to the location and condition
necessary for it to be capable of operating in the manner intended by management. Dismantlement, removal
or restoration costs are included as part of the cost of plant and equipment if the obligation for dismantlement,
removal or restoration is incurred as a consequence of acquiring or using the plant and equipment.
Subsequent expenditure relating to the plant and equipment that has already been recognised is added to the
carrying amount of the asset when it is probable that the future economic benefits, in excess of the standard
of performance of the asset before the expenditure was made, will flow to the Group and the Company and
the cost can be measured. Other subsequent expenditure is recognised as an expense during the financial year
in which it is incurred.
Depreciation is calculated on the straight-line method so as to allocate the depreciable amounts of the plant
and equipment over their estimated useful lives as follows:
Years
Demo equipment 3
Office equipment 3
Furniture and fittings 3
Renovation 3
Motor vehicles 7 to 10
The carrying values of plant and equipment are reviewed for impairment when events or changes in
circumstances indicate that the carrying values may not be recoverable.
The estimated useful lives, residual values and depreciation methods are reviewed, and adjusted as appropriate,
at the end of each reporting period.
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned
assets or, if there is no certainty that 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 its useful life.
The gain or loss arising on disposal or retirement of an item of plant and equipment is determined as the
difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or
loss.
Fully depreciated plant and equipment are retained in the financial statements until they are no longer in
use.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
48EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.5 Club membership
The club membership right is initially recorded at cost and is subsequently measured at cost less accumulated
impairment loss, if any.
2.6 Impairment of non-financial assets
At the end of each reporting period, the Group and the Company review the carrying amounts of their
non-financial assets to determine whether there is any indication that those assets have suffered an impairment
loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine
the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an
individual asset, the Group and the Company estimate the recoverable amount of the cash-generating unit to
which the asset belongs.
The recoverable amount of an asset or cash-generating unit is the higher of its fair value less costs to sell and
its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value
using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset.
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, unless the relevant asset is carried at a revalued amount, in which
case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is
increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not
exceed the carrying amount that would have been determined had no impairment loss been recognised for the
asset (cash-generating unit) in prior financial years. A reversal of an impairment loss is recognised immediately
in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the
impairment loss is treated as a revaluation increase.
2.7 Inventories
Inventories are stated at the lower of cost and net realisable value.
Cost is determined on a “first-in, first-out” basis and includes all costs of purchase, costs of conversion and other
costs incurred in bringing the inventories to their present location and condition.
Net realisable value is the estimated selling price at which inventories can be realised in the ordinary course
of business and cost incurred in marketing and distribution. When necessary, allowance is made for obsolete,
slow-moving and defective inventories to adjust the carrying value of those inventories to the lower of cost
and net realisable value.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
49
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.8 Financial instruments
Financial assets and financial liabilities are recognised on the Group’s and the Company’s statements of financial
position when the Group and the Company become parties to the contractual provisions of the instruments.
Effective interest method
The effective interest method is a method of calculating the amortised cost of a financial instrument and
allocating the interest income or expense over the relevant period. The effective interest rate exactly discounts
estimated future cash receipts or payments (including all fees on points paid or received that form an integral
part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life
of the financial instrument, or where appropriate, a shorter period, to the net carrying amount of the financial
instrument. Income and expense are recognised on an effective interest basis for debt instruments other than
those financial instruments at fair value through profit or loss.
Financial assets
All financial assets are recognised on a trade date where the purchase of a financial asset is under a contract
whose terms require delivery of the financial asset within the timeframe established by the market concerned,
and are initially measured at fair value, plus transaction costs, except for those financial assets classified as at
fair value through profit or loss, which are initially measured at fair value.
Financial assets are classified into the following specified categories: financial assets at fair value through profit or
loss, held-to-maturity investments, loans and receivables and available-for-sale financial assets. The classification
depends on the nature and purpose for which these financial assets were acquired and is determined at the
time of initial recognition.
Loans and receivables
Trade and other receivables that have fixed or determinable payments that are not quoted in active market are
classified as loans and receivables. Loans and receivables are measured at amortised cost, using the effective
interest method less impairment loss. Interest is recognised by applying the effective interest method, except
for short-term receivables when the recognition of interest would be immaterial.
Impairment of financial assets
Financial assets are assessed for indications of impairment at the end of each reporting period. Financial assets are
impaired where there is objective evidence that, as a result of one or more events that occurred after the initial
recognition of the financial asset, the estimated future cash flows of the investment have been impacted.
For financial assets carried at amortised cost, the amount of the impairment is the difference between the
asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective
interest rate.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
50EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.8 Financial instruments (Continued)
Impairment of financial assets (Continued)
The carrying amounts of all financial assets are reduced by the impairment loss directly with the exception of
trade receivables where the carrying amount is reduced through the use of an allowance account. Changes in
the carrying amount of the allowance account are recognised in profit or loss.
The amount of the impairment loss decreases and the decrease can be related objectively to an event occurring
after the impairment loss was recognised, the previously recognised impairment loss is reversed through profit
or loss to the extent the carrying amount of the investment at the date the impairment loss is reversed does
not exceed what the amortised cost would have been had the impairment loss not been recognised.
The Group and the Company derecognise a financial asset only when the contractual rights to the cash flows
from the asset expire, or they transfer the financial asset and substantially all the risks and rewards of ownership
of the asset to another entity. If the Group and the Company neither transfer nor retain substantially all the risks
and rewards of ownership of the financial asset and continue to control the transferred asset, the Group and the
Company recognise their retained interest in the asset and an associated liability for amounts they may have to
pay. If the Group and the Company retain substantially all the risks and rewards of ownership of a transferred
financial asset, the Group and the Company continue to recognise the financial asset and also recognise a
collateralised borrowing for the proceeds receivables.
Financial liabilities and equity instruments
Classification as debt or equity
Financial liabilities and equity instruments issued by the Group and the Company are classified according to
the substance of the contractual arrangements entered into and the definitions of a financial liability and an
equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Group and the
Company after deducting all of their liabilities.
Ordinary shares are classified as equity and recognised at the fair value of the consideration received by the
Group and the Company. Incremental costs directly attributable to the issuance of new equity instruments are
shown in the equity as a deduction from the proceeds.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
51
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.8 Financial instruments (Continued)
Financial liabilities and equity instruments (Continued)
Financial liabilities
Financial liabilities are classified as either financial liabilities at fair value through profit or loss or other financial
liabilities.
Financial liabilities are classified as at fair value through profit or loss if the financial liability is either held for
trading or it is designated as such upon initial recognition.
Other financial liabilities
Trade and other payables
Trade and other payables are initially measured at fair value, net of transaction costs, and are subsequently
measured at amortised cost, where applicable, using the effective interest method, with interest expense
recognised on an effective yield basis.
Derecognition of financial liabilities
The Group and the Company derecognise financial liabilities when, and only when, the Group’s and the
Company’s obligations are discharged, cancelled or they expire.
Derivative financial instruments and hedging activities
The Group and the Company enter into a variety of derivative financial instruments to manage their exposure
to foreign exchange rate risk, including foreign exchange forward contracts.
Derivatives are initially recognised at their fair values at the date the derivative contract is entered into and are
subsequently remeasured to their fair values at the end of each reporting period. The method of recognising the
resulting gain or loss depends on whether the derivative is designated and effective as a hedging instrument,
and if so, the nature of the item being hedged.
Fair value changes on derivatives that are not designated or do not qualify for hedge accounting are recognised
in profit or loss when the changes arise.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
52EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.9 Cash and cash equivalents
Cash and cash equivalents consist of cash on hand, cash and deposits with banks and financial institutions. Cash
and cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts
of cash and which are subject to an insignificant risk of changes in value. For the purpose of the consolidated
statement of cash flows, cash and cash equivalents comprise of cash on hand, cash at bank and fixed deposits
net of fixed deposits pledged.
2.10 Provisions
Provisions are recognised when the Group and the Company have a present legal or constructive obligation as
a result of a past event, it is probable that the Group and the Company will be required 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 reporting period, taking into account the risks and uncertainties surrounding the
obligation. Where a provision is measured using the cash flows estimated to 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 is recognised as an asset if it is virtually certain that reimbursement will be received
and the amount of the receivable can be measured reliably.
Changes in the estimated timing or amount of the expenditure or discount rate are recognised in profit or loss
when the changes arise.
2.11 Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. Revenue is recognised to
the extent that it is probable that the economic benefits will flow to the entity and the revenue can be reliably
measured. Revenue is presented, net of rebates, discounts and sales related taxes.
Revenue from sale of goods is recognised upon passage of title to the customer which coincides with the
delivery and acceptance.
Interest income is recognised on a time-proportion basis using the effective interest method.
Sponsorship income is recognised upon public presentation for media advertising.
Facilities fees income is recognised on a straight-line basis over the term of the service agreement.
Marketing income is recognised upon confirmation of the achievement of certain sales quota.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
53
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.12 Government grant – Jobs credit scheme
Government grants are recognised at their fair values where there is a reasonable assurance that the grant will
be received and all attaching conditions will be complied with. Where the grant relates to an asset, the fair value
is recognised as deferred capital grant on the statements of financial position and is amortised to profit or loss
over the expected useful life of the relevant asset by equal annual installment.
The Singapore government introduced a cash grant known as the jobs credit scheme in its Budget for 2009 in
a bid to help businesses preserve jobs in the economic downturn. The amounts received for jobs credit are to
be paid to eligible employers in 2009 in four payments and the amount an employer can receive would depend
on the fulfillment of the conditions as stated in the Scheme.
In October 2009, the Government announced that the Jobs Credit Scheme would be extended for half a year
with another 2 payments at stepped-down rates in March and June 2010 based on 6% of wages to be paid in
March 2010 and 3% of wages to be paid in June 2010.
The Group and the Company recognise the amounts received for jobs credit at their fair values as other income
in the month of receipt of these grants from the government.
2.13 Employee benefits
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in profit or loss in the same financial
year as the employment that gives rise to the contributions.
Employee leave entitlement
Employee entitlements to annual leave are recognised when they accrue to employees. An accrual is made for
estimated liability for unutilised annual leave as a result of services rendered by employees up to the end of
the reporting period.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
54EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.14 Leases
When the Group and the Company are the lessees of a finance lease
Leases in which the Group and the Company assume substantially the risks and rewards of ownership are
classified as finance leases.
Upon initial recognition, plant and equipment acquired through finance lease is capitalised at the lower of its
fair value and the present value of the minimum lease payments. Any initial direct costs are also added to the
amount capitalised.
Subsequent to initial recognition, the plant and equipment is accounted for in accordance with the accounting
policy applicable to that plant and equipment. Lease payments are apportioned between finance charge and
reduction of the lease liability. The finance charge is allocated to each period during the lease term so as to
achieve a constant periodic rate of interest on the remaining balance of the finance lease liability. Finance
charge is recognised in profit or loss.
When the Group and the Company are the lessees of operating leases
Leases of assets in which a significant portion of the risks and rewards of ownership are retained by the lessor
are classified as operating leases. Payments made under operating leases (net of any incentives received from
the lessor) are recognised in profit or loss on a straight-line basis over the period of the lease.
When an operating lease is terminated before the lease period has expired, any payment required to be made
to the lessor by way of penalty is recognised as an expense in the financial year in which termination takes
place.
Contingent rents are recognised as an expense in profit or loss in the financial year in which they are
incurred.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
55
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.15 Income tax
Income tax expense represents the sum of the tax currently payable and deferred tax. Income tax expense is
recognised in profit or loss to the extent that it relates to a business combination or items recognised directly
in equity or other comprehensive income.
The tax currently payable is based on taxable profit for the financial year and any adjustments to income tax
payable in respect of previous financial years. Taxable profit differs from profit as reported profit or loss because
it excludes items of income or expense that are taxable or deductible in other financial years and it further
excludes items that are not taxable or tax deductible. The Group’s and the Company’s liabilities for current tax
is calculated using tax rates (and tax laws) that have been enacted or substantively enacted in countries where
the Company and subsidiaries operate by the end of the reporting period.
Deferred tax is recognised on the differences between the carrying amounts of assets and liabilities in the
financial statements and the corresponding tax bases used in the computation of taxable profit, and are
accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for
all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible temporary differences can be utilised. Such assets
and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition
(other than in a business combination) of other assets and liabilities in a transaction that affects neither the
taxable profit nor the accounting profit.
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 probable that 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 the tax rates (and tax laws) that have been enacted or substantively enacted by
the end of the reporting period. Deferred tax is charged or credited to profit or loss, except when it relates to
items charged or credited directly to other comprehensive income, in which case the deferred tax is also dealt
within equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets
against current tax liabilities and when they relate to income taxes levied by the same taxation authority and
the Group and the Company intend to settle their current tax assets and liabilities on a net basis.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
56EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.15 Income tax (Continued)
Unrecognised deferred tax assets are reassessed at the end of each reporting period and are recognised to the
extent that it has become probable that future taxable profits will be available against which the temporary
differences can be utilised.
Current and deferred tax are recognised as an expense or income in profit or loss, except when they relate to
items credited or debited directly to equity, in which case the tax is also recognised directly in equity, or where
they arise from the initial accounting for a business combination. In the case of a business combination, the tax
effect is taken into account in calculating goodwill or determining the excess of the acquirer’s interest in the
net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities over cost.
Deferred tax liabilities are recognised for all taxable temporary differences associated with investment in
subsidiary, except where the timing of the reversal of the temporary difference can be controlled by the Group
and it is probable that the temporary difference will not reverse in the forseeable future.
2.16 Foreign currency transactions and translation
The consolidated financial statements and the statement of financial position of the Company are presented
in Singapore dollar, which is the functional currency of the Company and the presentation currency for the
consolidated financial statements.
Items included in the individual financial statements of each entity in the Group are measured using the currency
of the primary economic environment in which the entity operates (“functional currency”).
In preparing the financial statements, transactions in currencies other than the entity’s functional currency
(“foreign currencies”) are recorded at the rates of exchange prevailing on the date of the transactions. At the
end of each reporting period, monetary items denominated in foreign currencies are re-translated at the rates
prevailing at the end of the reporting period. Non-monetary items carried at fair value that are denominated
in foreign currencies are re-translated at the rates prevailing on the date when the fair value was determined.
Non-monetary items that are measured in terms of historical cost in a foreign currency are not re-translated.
Exchange differences arising on the settlements of monetary items and on re-translating of monetary items are
included in profit or loss for the financial year. Exchange differences arising on the re-translation of non-monetary
items carried at fair value are included in profit or loss for the financial year except for differences arising on
the re-translation of non-monetary items in respect of which gains and losses are recognised directly in other
comprehensive income. For such non-monetary items, any exchange component of that gain or loss is also
recognised directly in other comprehensive income.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
57
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
2. Summary of significant accounting policies (Continued)
2.16 Foreign currency transactions and translation (Continued)
For the purpose of presenting consolidated financial statements, the results and financial positions, changes
in equity and cash flows of the Group’s entities that have a functional currency different from the presentation
currency are translated into the presentation currency as follows:
(i) assets and liabilities are translated at the closing exchange rate at the end of the reporting period;
(ii) income and expenses are translated at average exchange rate for the financial year (unless this average
is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction
dates, in which case income and expenses are translated using the exchange rates at the dates of the
transactions); and
(iii) all resulting foreign currency exchange differences are recognised in other comprehensive income and
presented in the foreign currency translation (account)/reserve in equity.
2.17 Dividends
Equity dividends are recognised when they become legally payable. Interim dividends are recorded in the
financial year in which they are declared payable. Final dividends on ordinary shares are recognised as a liability
in the financial year in which the dividends are approved by the shareholders.
2.18 Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision maker. The chief operating decision maker, who is responsible for allocating resources and
assessing performance of the operating segments, has been identified as the group of executive directors and
the chief executive officer who makes strategic decisions.
3. Critical accounting judgements and key sources of estimation uncertainty
3.1 Critical judgements in applying the accounting policies
The following are the critical judgements, apart from those involving estimations that management has made
in the process of applying the Group’s and the Company’s accounting policies and which have significant effect
on the amounts recognised in the financial statements.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
58EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
3. Critical accounting judgements and key sources of estimation uncertainty (Continued)
3.1 Critical judgements in applying the accounting policies (Continued)
(i) Impairment of investments in subsidiaries and financial assets
The Group and the Company follow the guidance of FRS 36 and FRS 39 on determining whether an
investment or a financial asset is impaired. This determination requires significant judgement. The Group
and the Company evaluate, among other factors, the duration and extent to which the fair value of an
investment in subsidiary or a financial asset is less than its cost and the financial health of and near-term
business outlook for the investment in subsidiary or financial asset, including factors such as industry
and sector performance, changes in technology and operational and financing cash flow.
3.2 Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the
reporting period that have a significant risk of causing a material adjustment to the carrying amounts of assets
and liabilities and reported amounts of revenue and expenses within the next financial year, are discussed
below.
(i) Depreciation of plant and equipment
Plant and equipment are depreciated on a straight-line basis over their estimated useful lives. The
management estimates the useful lives of these assets to be within 3 to 10 years. The carrying amounts of
the Group’s and the Company’s plant and equipment as at 30 June 2011 were approximately $2,510,000
and $900,000 (2010: $1,860,000 and $146,000) respectively. Changes in the expected level of usage and
technological developments could impact the economic useful lives and the residual values of these
assets, therefore future depreciation charges could be revised.
(ii) Allowance for inventory obsolescence
Inventories are stated at the lower of cost and net realisable value. The management primarily determines
cost of inventories using the “first-in, first-out” method. The management estimates the net realisable
value of inventories based on assessment of receipt or committed sales prices and provides for excess
and obsolete inventories based on historical and estimated future demand and related pricing. In
determining excess quantities, the management considers recent sales activities, related margin and
market positioning of its products. However, factors beyond its control, such as demand levels and pricing
competition, could change from period to period. Such factors may require the Group to reduce the value
of its inventories. The carrying amount of the Group’s inventories as at 30 June 2011 was approximately
$10,137,000 (2010: $8,065,000).
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
59
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
3. Critical accounting judgements and key sources of estimation uncertainty (Continued)
3.2 Key sources of estimation uncertainty (Continued)
(iii) Allowance for doubtful receivables
The management establishes allowance for doubtful receivables on a case-by-case basis when they
believe that payment of amounts owed is unlikely to occur. In establishing these allowances, the
management considers the historical experience and changes to the customers’ financial position. If the
financial conditions of receivables were to deteriorate, resulting in impairment of their abilities to make
the required payments, additional allowances may be required. The carrying amounts of the Group’s
and the Company’s trade and other receivables as at 30 June 2011 were approximately $5,841,000 and
$6,496,000 (2010: $5,943,000 and $9,645,000) respectively.
(iv) Income taxes
Significant judgements are involved in determining the Group’s and the Company’s income taxes. There
are certain transactions and computations for which the ultimate tax determination is uncertain during
the ordinary course of business. Where the final tax outcome of these matters differs from the amounts
that were initially recognised, such differences will impact the current income tax and deferred tax
provisions in the financial year in which such determination is made. The carrying amounts of the Group’s
and the Company’s current income tax payable as at 30 June 2011 were approximately $913,000 and
$Nil (2010: $575,000 and $9,000) respectively. The carrying amounts of the Group’s and the Company’s
deferred tax liabilities as at 30 June 2011 were approximately $78,000 and $15,000 (2010: $78,000 and
$15,000) respectively.
(v) Provision for reinstatement costs
The Group and the Company measure the provision for reinstatement costs of leased premises to
their original state with reference to the terms and conditions of each respective tenancy agreement,
and the expected date of reinstatement. The calculation of provision for reinstatement costs requires
management to estimate the expected future cash outflows as a result of site restoration at their best
estimate. The carrying amounts of the Group’s and the Company’s provision for reinstatement costs as
at 30 June 2011 were approximately $135,000 and $50,000 (2010: $139,000 and $54,000) respectively.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
60EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
4. Club membership
Group and Company
2011 2010
$’000 $’000
Club membership, at cost 223 –
Club membership comprises membership from a country club in Singapore. As at the end of the reporting period, the
carrying amount of the club membership approximates the fair value.
As at 30 June 2011, the club membership with carrying amount of approximately $223,000 (2010: $Nil) is registered in the
name of a Director of the Company who is holding the club membership in trust for the Group and the Company.
5. Plant and equipment
Demo
equipment
Office
equipment
Furniture
and fittings Renovation
Motor
vehicles Total
Group $’000 $’000 $’000 $’000 $’000 $’000
2011
Cost
Balance at 1 July 2010 50 670 225 2,221 52 3,218
Additions – 384 319 633 356 1,692
Disposals – (1) – – – (1)
Written off – (57) (15) (59) – (131)
Currency translation adjustment – (11) (9) (12) – (32)
Balance at 30 June 2011 50 985 520 2,783 408 4,746
Accumulated depreciation
Balance at 1 July 2010 40 369 141 793 15 1,358
Depreciation for
the financial year 6 225 75 672 18 996
Disposals – –* – – – –*
Written off – (57) (15) (31) – (103)
Currency translation adjustment – (7) (5) (3) – (15)
Balance at 30 June 2011 46 530 196 1,431 33 2,236
Carrying amount
Balance at 30 June 2011 4 455 324 1,352 375 2,510
* Denotes less than $1,000
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
61
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
5. Plant and equipment (Continued)
Demo
equipment
Office
equipment
Furniture
and fittings Renovation
Motor
vehicle Total
Group $’000 $’000 $’000 $’000 $’000 $’000
2010
Cost
Balance at 1 July 2009 47 378 132 546 52 1,155
Additions 3 284 84 1,664 – 2,035
Disposals – (1) – – – (1)
Currency translation
adjustment – 9 9 11 – 29
Balance at 30 June 2010 50 670 225 2,221 52 3,218
Accumulated depreciation
Balance at 1 July 2009 34 212 97 396 10 749
Depreciation during
the financial year 6 152 39 394 5 596
Disposals – (1) – – – (1)
Currency translation adjustment – 6 5 3 – 14
Balance at 30 June 2010 40 369 141 793 15 1,358
Carrying amount
Balance at 30 June 2010 10 301 84 1,428 37 1,860
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
62EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
5. Plant and equipment (Continued)
Demo
equipment
Office
equipment
Furniture
and fittings Renovation
Motor
vehicles Total
Company $’000 $’000 $’000 $’000 $’000 $’000
2011
Cost
Balance at 1 July 2010 31 151 15 54 52 303
Additions – 89 96 369 356 910
Written off – (1) (15) (54) – (70)
Balance at 30 June
2011 31 239 96 369 408 1,143
Accumulated depreciation
Balance at 1 July 2010 31 77 15 19 15 157
Depreciation for the financial
year – 63 9 42 18 132
Written off – (1) (15) (30) – (46)
Balance at 30 June 2011 31 139 9 31 33 243
Carrying amount
Balance at 30 June 2011 – 100 87 338 375 900
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
63
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
5. Plant and equipment (Continued)
Demo
equipment
Office
equipment
Furniture
and fittings Renovation
Motor
vehicle Total
Company $’000 $’000 $’000 $’000 $’000 $’000
2010
Cost
Balance at 1 July 2009 31 195 48 343 52 669
Additions – 70 – 54 – 124
Disposals – (114) (33) (343) – (490)
Balance at 30 June 2010 31 151 15 54 52 303
Accumulated depreciation
Balance at 1 July 2009 31 142 44 336 10 563
Depreciation for the financial
year – 31 1 19 5 56
Disposals – (96) (30) (336) – (462)
Balance at 30 June 2010 31 77 15 19 15 157
Carrying amount
Balance at 30 June 2010 – 74 – 35 37 146
As at 30 June 2011, the carrying amounts of motor vehicles of the Group and the Company which were acquired under
finance lease arrangements were approximately $375,000 and $375,000 (2010: $37,000 and $37,000) respectively. Finance
leased assets are pledged as securities for the related finance lease liabilities (Note 13).
As at 30 June 2011, the motor vehicle with carrying amount of approximately $343,000 (2010: $Nil) is registered in the
name of a Director of the Company who is holding the motor vehicle in trust for the Group and the Company.
For the purpose of consolidated statement of cash flows, the Group’s additions to plant and equipment were financed
as follows:
Group
2011 2010
$’000 $’000
Additions of plant and equipment 1,692 2,035
Less:
Provision for reinstatement costs (50) (139)
Finance lease agreements (244) –
Other payables (112) –
Cash payments to acquire plant and equipment 1,286 1,896
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
64EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
6. Investments in subsidiaries
Company
2011 2010
$’000 $’000
Unquoted equity shares, at cost 1,120 980
The details of the subsidiaries are as follows:
Name of company
(Country of incorporation)
Effective equity
interest Principal activities
2011 2010
% %
Epicentre Solutions Pte. Ltd. (1)
(Singapore)
100 100 Providing IT solutions to educational institutions
within Singapore
Epicentre Pte. Ltd. (1)
(Singapore)
100 100 Retail of Apple brand products and
complementary products
Epicentre Lifestyle Sdn. Bhd. (2)
(Formerly known as Afor Sdn. Bhd.)
(Malaysia)
100 100 Retail of Apple brand products and
complementary products
Epi Lifestyle Pte. Ltd. (1)
(Singapore)
100 100 Dormant
Epicentre (Shanghai) Co., Ltd (3)
(People’s Republic of China)
70 – Dormant
(1) Audited by BDO LLP, Singapore
(2) Audited by BDO, Malaysia
(3) Not required to be audited in the country of incorporation
Incorporation of subsidiaries
On 14 February 2011, the Company subscribed for 70% equity interest in the registered capital of Epicentre (Shanghai)
Co., Ltd, a company incorporated in People’s Republic of China for a consideration of approximately $140,000
(US$110,000).
On 13 April 2010, the Company incorporated a wholly-owned subsidiary, Epi Lifestyle Pte. Ltd., a company incorporated
in Singapore for a consideration of $500,000.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
65
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
7. Inventories
Group
2011 2010
$’000 $’000
Trading goods 10,137 8,065
The cost of inventories recognised as an expense and included in “cost of sales” line item in profit or loss amounted to
approximately $138,397,000 (2010: $73,768,000).
As at 30 June 2011, the Group carried out a review of the realisable values of its inventories and the review led to the
recognition of an allowance for obsolete inventories and inventories written off of approximately $31,000 and $72,000
(2010: $Nil and $53,000) respectively that have been included in “administrative expenses” line item in profit or loss.
8. Trade and other receivables
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Trade receivables – third parties 3,644 4,127 – 47
Due from subsidiaries – non-trade – – 6,431 9,551
Other receivables and rebate accruals 809 596 – –
Rental and other deposits 1,388 1,220 65 47
5,841 5,943 6,496 9,645
Trade receivables are unsecured, non-interest bearing and generally on 30 to 60 days’ (2010: 30 to 60 days’) credit
terms.
The non-trade amounts due from subsidiaries are unsecured, non-interest bearing and repayable on demand.
Movement in allowance for doubtful third parties trade receivables was as follows:
Group
2011 2010
$’000 $’000
Balance at beginning of financial year – 7
Write-back of allowance no longer required – (7)
Balance at end of financial year – –
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
66EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
8. Trade and other receivables (Continued)
The write-back of allowance for doubtful third parties trade receivables no longer required of approximately $Nil (2010:
$7,000) were included in “administrative expenses” line item in profit or loss subsequent to the recovery of the related
receivables.
Trade and other receivables are denominated in the following currencies:
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Singapore dollar 4,513 5,033 6,496 9,645
United States dollar 524 487 – –
Ringgit Malaysia 780 423 – –
Chinese renminbi 24 – – –
5,841 5,943 6,496 9,645
9. Derivative financial instruments
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Assets
Foreign currency forward contracts – 45 – 45
Liabilities
Foreign currency forward contracts 14 – 6 –
Foreign currency forward contracts
Foreign currency forward contracts are agreements to buy or sell fixed amounts of currency at agreed exchange rates
to be settled in the future. The Group and the Company enter into various foreign currency forward contracts to reduce
its exposure on anticipated transactions and firm commitments, primarily for forecasted cash outflows denominated
in currencies other than the Company’s and the respective subsidiaries’ functional currencies. These foreign currency
forward contracts generally have maturity dates of less than 6 months.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
67
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
9. Derivative financial instruments (Continued)
Foreign currency forward contracts (Continued)
As at the end of the reporting period, the Group and the Company entered into foreign currency forward contracts
as follows:
Group
Average
exchange rates
Foreign
currency
Notional
amount Fair value Settlement date
2011 ’000 ’000 $’000
Buy United States dollar 1.23 $4,684 US$3,800 (14) 21 July to
29 July 2011
2010
Buy United States dollar 1.39 $9,176 US$6,600 45 16 August to
23 December 2010
Company
2011
Buy United States dollar 1.23 $1,235 US$1,000 (6) 21 July 2011
2010
Buy United States dollar 1.39 $9,176 US$6,600 45 16 August to
23 December 2010
The above derivatives are measured at fair values at the end of the reporting period. Their fair values are determined
based on the market prices for equivalent instruments at the end of the reporting period.
10. Cash and cash equivalents
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Cash and bank balances 13,675 8,737 1,929 1,346
Fixed deposits 1,195 2,257 1,195 2,146
Cash and cash equivalents on statements
of financial position 14,870 10,994 3,124 3,492
Fixed deposits pledged – (1,713)
Cash and cash equivalents included in
consolidated statement of cash flows 14,870 9,281
Fixed deposits mature on varying dates within 1 year (2010: 1 to 2 years) from the end of the reporting period with
options for early termination. The effective interest rates on the fixed deposits range from 0.25% to 0.50% (2010: 0.35%
to 1.83%) per annum.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
68EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
10. Cash and cash equivalents (Continued)
As at the end of the reporting period, the Group and the Company have banking facilities as follows:
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Banking facilities granted 62,398 29,338 14,173 29,338
Banking facilities utilised
– currency forward exchange 4,684 9,176 1,235 9,176
– bankers’ guarantee 4,472 2,499 1,381 2,499
9,156 11,675 2,616 11,675
As at 30 June 2011, the banking facilities of approximately $44,953,000 were granted jointly to certain entities within
the Group.
As at 30 June 2011, the Group’s and the Company’s banking facilities are unsecured.
As at 30 June 2010, the Group’s and the Company’s banking facilities of approximately $29,338,000 and $29,338,000
are secured by fixed deposits of approximately $1,713,000 and $1,713,000 respectively.
Cash and cash equivalents are denominated in the following currencies:
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Singapore dollar 11,391 8,348 1,906 2,104
United States dollar 1,298 2,220 1,218 1,388
Ringgit Malaysia 2,028 426 – –
Chinese renminbi 153 – – –
14,870 10,994 3,124 3,492
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
69
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
11. Trade and other payables
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Trade payables – third parties 10,939 7,314 3 44
Deposits placed by customers 768 438 – –
Accrued operating expenses 577 811 286 502
Other payables
– third parties 571 170 49 33
– a director of the Company 112 – 112 –
12,967 8,733 450 579
Trade payables are unsecured, non-interest bearing and are normally settled between 30 to 60 days’ (2010: 30 to 60
days’) credit terms.
The non-trade amount due to a Director of the Company is unsecured, non-interest bearing and repayable on
demand.
Trade and other payables are denominated in the following currencies:
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Singapore dollar 3,627 3,118 450 579
United States dollar 8,844 5,131 – –
Ringgit Malaysia 448 484 – –
Chinese renminbi 48 – – –
12,967 8,733 450 579
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
70EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
12. Provisions
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Provision for reinstatement costs
Balance at beginning of financial year 139 – 54 –
Provision made during the financial year 50 139 50 54
Reversal of provision unutilised (54) – (54) –
Balance at end of financial year 135 139 50 54
The provision for reinstatement costs are the estimated costs of dismantlement, removal or restoration of plant and
equipment arising from the use of assets which are capitalised and included in the cost of plant and equipment.
13. Finance lease payables
Group and Company
Minimum
lease
payments
Future
finance
charges
Present value
of minimum
lease
payments
$’000 $’000 $’000
2011
Current liabilities
Within one financial year 40 (5) 35
Non-current liabilities
After one financial year but within five financial years 197 (23) 174
After five financial years 29 (3) 26
226 (26) 200
266 (31) 235
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
71
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
13. Finance lease payables (Continued)
Group and Company
Minimum
lease
payments
Future
finance
charges
Present value
of minimum
lease
payments
$’000 $’000 $’000
2010
Current liabilities
Within one financial year 7 (1) 6
Non-current liabilities
After one financial year but within five financial years 1 – 1
8 (1) 7
The finance lease terms are 4 to 7 (2010: 4) years and the effective interest rates for finance lease obligations ranges
from 3.57% to 6.04% (2010: 6.04%) per annum.
Interest rates are fixed at contract date and thus expose the Group and the Company to fair value interest rate risk. All
leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The Group’s and the Company’s obligations under finance leases are secured by the lessors’ title to the leased assets,
which will revert to the lessors in the event of default by the Group and the Company.
The fair values of non-current finance leases as at the end of the reporting period approximate their carrying
amounts.
The finance lease payables are denominated in Singapore dollar.
14. Deferred tax liabilities
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Balance at beginning of financial year 78 42 15 15
Charged to profit or loss – 36 – –
Balance at end of financial year 78 78 15 15
Deferred tax liabilities arise as a result of temporary differences between the tax written down values and the carrying
amounts of plant and equipment.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
72EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
15. Share capital
Group and Company
2011 2010
Number of Number of
ordinary
shares
ordinary
shares
2011
$’000
2010
$’000
Issued and fully-paid:
At beginning and end of financial year 93,501,600 93,501,600 6,709 6,709
The holders of ordinary shares are entitled to receive dividends as and when declared by the Company. All ordinary
shares have no par value and carry one vote per share without restriction.
16. Foreign currency translation (account)/reserve
The foreign currency translation (account)/reserve comprises all foreign exchange differences arising from the translation
of the financial statements of foreign operations whose functional currency is different from that of the Group’s
presentation currency and is non-distributable.
17. Revenue
Revenue represents the invoiced value of goods sold less goods returned, discounts allowed and goods and services
tax.
18. Other income
Group
2011 2010
$’000 $’000
Facilities fees 300 203
Foreign exchange gain, net – 532
Government grant – Jobs credit scheme 3 102
Marketing income 146 127
Sponsorship income 622 358
Reversal of provision for reinstatement cost unutilised 30 –
Others 264 73
1,365 1,395
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
73
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
19. Profit before income tax
In addition to the charges and credits disclosed elsewhere in the notes to the financial statements, the above includes
the following charges/(credits):
Group
2011 2010
$’000 $’000
Administrative expenses
Allowance for inventory obsolescence 31 –
Bad third parties trade receivables written off 23 –
Depreciation of plant and equipment 996 596
Directors’ fees – Directors of the Company 262 100
Foreign exchange loss, net 238 –
Loss on disposals of plant and equipment 1 –
Non-audit fees paid
– auditors of the Company 12 11
– other auditors of subsidiaries 6 2
Inventories written off 72 53
Operating lease expenses 4,213 2,607
Plant and equipment written off 4 –
Write-back of allowance for doubtful third parties trade
receivables no longer required – (7)
Employee benefits expense
– salaries, wages, and bonuses 6,845 3,582
– contributions to defined contribution plans 608 394
– other employee benefits 362 292
Selling and distribution costs
Advertising and promotion 1,579 1,105
Commission expenses 569 339
Credit card charges 2,190 1,302
Included in the employee benefits expense were Directors’ remuneration as shown in Note 24 to the financial
statements.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
74EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
20. Income tax expense
Group
2011 2010
$’000 $’000
Current income tax
– current financial year 1,006 657
– (over)/under provision in prior financial years (23) 16
983 673
Deferred income tax
– current financial year – 36
Total income tax expense recognised in profit or loss 983 709
Reconciliation of effective income tax rate
Group
2011 2010
$’000 $’000
Profit before income tax 5,730 4,097
Income tax calculated at Singapore’s statutory income tax rate of 17% 974 696
Effect of different income tax rate in other countries 47 30
Expenses not deductible for income tax purposes 167 54
Income not taxable for income tax purposes (19) (36)
Singapore’s statutory stepped income tax exemption (26) (35)
(Over)/Under provision of current income tax in prior financial years (23) 16
Enhanced income tax deduction (108) (8)
Others (29) (8)
983 709
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
75
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
21. Earnings per share
The calculation for earnings per share is based on:
Group
2011 2010
Profit for the financial year attributable to owners of the parent ($’000) 4,767 3,388
Actual number of ordinary shares 93,501,600 93,501,600
Basic and diluted earnings per share (in cents) 5.10 3.62
Basic earnings per share is calculated by dividing profit for the financial year attributable to owners of the parent by
the actual number of ordinary shares in issue during the financial year. As the Group has no dilutive potential ordinary
shares, the diluted earnings per share is equivalent to basic earnings per share for the financial year.
22. Dividends
Group and Company
2011 2010
$’000 $’000
Interim tax-exempt (one-tier) dividend declared and paid of
$0.01 (2010: $Nil) per share in respect of the current financial year 935 –
First and final tax-exempt (one-tier) dividend declared and paid of
$0.02 (2010: $Nil) per share in respect of financial years ended 30 June 2010
and 2009 1,870 –
2,805 –
The Directors of the Company recommend a final and a special one-off tax-exempt dividends of $0.02 and $0.02 per
share respectively with an aggregate amount of approximately $3,740,000 to be paid in respect of the financial year
ended 30 June 2011. These final and special one-off dividends have not been recognised as liabilities as at the end of
the reporting period as these dividends are subject to approval at the Annual General Meeting of the Company.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
76EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
23. Commitments
Operating lease commitments
Group and Company as lessees
As at the end of the reporting period, there were operating lease commitments for rental payable in subsequent
accounting periods as follows:
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Within one financial year 3,904 3,188 247 149
After one financial year but within
five financial years 4,303 3,508 366 122
8,207 6,696 613 271
The above operating lease commitments are based on existing rental rates. Some of the operating leases of premises
provide for rentals based on percentage of sales derived from the rented premises. The Group and the Company have
the options to renew certain agreements on the lease premises for 3 years.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
77
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
24. Significant related party transactions
For the purpose of these financial statements, parties are considered to be related to the Group and the Company if the
Group or the Company have the ability, directly or indirectly, to control the party or exercise significant influence over
the party in making financial and operating decisions, or vice versa, or where the Group or the Company and the party
are subject to common control or common significant influence. Related parties may be individuals or other entities.
In addition to the information disclosed elsewhere in the financial statements, the following are significant related party
transactions during the financial year at rates and terms agreed between the parties:
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
With subsidiaries
Advances made to a subsidiary – – 5,008 5,719
Management fees charged to subsidiaries – – 5,912 2,747
Settlement of liabilities on behalf of subsidiaries – – 34 7,216
Transfers of plant and equipment to a subsidiary – – – 26
With a Director of the Company
Payments made by a Director on behalf of the
Company 112 – 112 –
Compensation of key management personnel
The remuneration of the key management personnel who are also the Directors of the Company during the financial
year are as follows:
Group and Company
2011 2010
$’000 $’000
Directors’ fees 262 100
Short-term benefits 2,692 632
Post-employment benefits 27 27
2,981 759
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
78EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
25. Segment information
Management has determined the operating segments based on the reports reviewed by the chief operating decision
maker.
A segment is a distinguishable component of the Group that is engaged either in providing products or services
(business segment), or in providing products or services within a particular economic environment (geographical
segment), which is subject to risks and rewards that are different from those of other segments.
Management monitors the operating results of the segments separately for the purpose of making decision about
resources to be allocated and of assessing performance. Segments performances are evaluated based on operation
profit or loss which is similar to the accounting profit or loss.
The Group has two reportable segments being apple brand products and third party and proprietary brand
complementary products.
The Group’s reportable segments are strategic business units that are organised based on their function and targeted
customers group. They are managed separately because each business unit requires different skill sets and market
strategies.
Management monitors the operating results of the segments separately for the purpose of making decisions about
resources to be allocated and of assessing performance. Segment performance is evaluated based on operation profit
or loss which is similar to the accounting profit or loss.
Income taxes are managed on a Group basis.
The accounting policies of the operating segments are the same of those described in the summary of significant
accounting policies. There is no asymmetrical allocation to reportable segments. Management evaluates performance
on the basis of profit or loss from operations before income tax expense not including non-recurring gains and losses
and foreign exchange gains or losses.
There is no change from prior periods in the measurement methods used to determine reportable segment profit or
loss.
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
79
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
25. Segment information (Continued)
The Group accounts for intersegment sales and transfers as if the sales or transfers were to third parties, which
approximate market prices. These intersegment transactions are eliminated on consolidation.
Apple brand
products
Third party and
proprietary
brand
complementary
products Unallocated Elimination Consolidated
$’000 $’000 $’000 $’000 $’000
2011
Revenue
External revenue 138,703 23,900 – – 162,603
Inter-segment revenue 485 10 5,912 (6,407) –
139,188 23,910 5,912 (6,407) 162,603
Results
Interest income – – 13 – 13
Depreciation of plant and
equipment (850) (146) – – (996)
Operating lease expenses (3,594) (619) – – (4,213)
Other material non-cash expenses
– allowance for inventory obsolescence (26) (5) – – (31)
– bad third parties trade receivables
written off (20) (3) – – (23)
– inventories written off (61) (11) – – (72)
– plan and equipment written off (3) (1) – – (4)
– reversal of provision for reinstatement
cost unutilised 26 4 – – 30
Segment profit 2,139 2,853 738 – 5,730
Capital expenditure
Plant and equipment 1,443 249 – – 1,692
Asset and liabilities
Segment assets 35,293 8,656 – (9,875) 34,074
Segment liabilities 18,856 3,249 78 (8,754) 13,429
Current income tax payable – – 913 – 913
14,342
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
80EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
25. Segment information (Continued)
Apple brand
products
Third party and
proprietary
brand
complementary
products Unallocated Elimination Consolidated
$’000 $’000 $’000 $’000 $’000
2010
Revenue
External revenue 71,857 16,225 – – 88,082
Inter-segment revenue 225 122 2,747 (3,094) –
72,082 16,347 2,747 (3,094) 88,082
Results
Interest income – – 14 – 14
Depreciation of plant and
equipment (486) (110) – – (596)
Operating lease expenses (2,127) (480) – – (2,607)
Other material non-cash expenses
– inventories written off (43) (10) – – (53)
– write-back of allowance for doubtful
third parties trade receivables
no longer required (6) (1) – – (7)
Segment profit 1,050 2,438 609 – 4,097
Capital expenditure
Plant and equipment 1,660 375 – – 2,035
Asset and liabilities
Segment assets 22,078 6,196 – (980) 27,294
Segment liabilities 7,245 1,634 78 – 8,957
Current income tax payable – – 575 – 575
9,532
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
81
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
25. Segment information (Continued)
Geographic information
The Group’s business segments operate in two main geographical areas. Revenue is based on the countries in which
the customers are located.
Revenue from external customers
Singapore Malaysia Consolidated
$’000 $’000 $’000
2011
Revenue from external customers 139,127 23,476 162,603
2010
Revenue from external customers 77,543 10,539 88,082
Non-current assets
Singapore Malaysia
People’s
Republic
of China Consolidated
$’000 $’000 $’000 $’000
2011
Non-current assets 2,090 632 11 2,733
2010
Non-current assets 1,561 299 – 1,860
Non-current assets shown by the geographical area in which the assets are located.
Major customers
The Group does not have a major customer whose revenue is 10% or more of the Group’s revenue.
26. Financial instruments, financial risks and capital management
The Group’s and the Company’s activities expose them to credit risk, market risk (including foreign currency risk and
interest rate risk) and liquidity risk. The Group’s and the Company’s overall risk management strategy seek to minimise
adverse effects from the volatility of financial markets on the Group’s and the Company’s financial performance.
The Board of Directors of the Company is responsible for settling the objectives and underlying principles of financial
risk management for the Group and the Company. The Group’s and the Company’s management then establish the
detailed policies such as risk identification and measurement, exposure limits and hedging strategies, in accordance
with the objectives and underlying principles approved by the Board of Directors.
There has been no change to the Group’s and the Company’s exposure to these financial risks or the manner in which
they manage and measure these risks.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
82EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
26. Financial instruments, financial risks and capital management (Continued)
26.1 Credit risk
Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in a loss to the
Group and the Company.
The Group does not have any significant credit exposure to any single counterparty or any group of counterparties
having similar characteristics on trade receivables from third parties. The Company has significant credit exposure
arising from the non-trade amounts due from subsidiaries amounting to approximately $6,431,000 (2010:
$9,551,000) as at the end of the reporting period.
As the Group and the Company do not hold any collateral, the maximum exposure to credit risk for each class
of financial instrument is the carrying amount of that class of financial instrument.
The Group’s and the Company’s major classes of financial assets are cash and cash equivalents and trade and
other receivables.
Trade receivables that are neither past due nor impaired are substantially companies with good collection
track records within the Group. The Group’s historical experience in the collection of receivables falls within
the credit terms.
The table below is an analysis of gross trade receivables as at the end of the reporting period.
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Not impaired
Not past due 3,488 3,620 – 43
Past due 61 to 90 days 132 357 – –
Past due more than 90 days 24 150 – 4
Total trade receivables 3,644 4,127 – 47
The table below is an analysis of the Company’s gross non-trade receivables from its subsidiaries as at the end
of the reporting period.
Company
2011 2010
$’000 $’000
Not impaired
Not past due 4,165 9,375
Past due 61 to 90 days 1,229 –
Past due more than 90 days 1,037 176
Total non-trade receivables from subsidiaries 6,431 9,551
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
83
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
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$’00
0$’
000
$’00
0$’
000
$’00
0$’
000
$’00
0$’
000
$’00
0
Sing
apor
e do
llar
4,51
311
,391
15,9
04(2
,891
)(2
35)
(3,1
26)
12,7
78(1
2,77
8)–
Uni
ted
Stat
es d
olla
r52
41,
298
1,82
2(8
,844
)–
(8,8
44)
(7,0
22)
–(7
,022
)
Ring
git M
alay
sia
780
2,02
82,
808
(416
)–
(416
)2,
392
(2,3
92)
–
Chin
ese
renm
inbi
2415
317
7(4
8)–
(48)
129
(129
)–
5,84
114
,870
20,7
11(1
2,19
9)(2
35)
(12,
434)
8,27
7
2010
Sing
apor
e do
llar
5,03
38,
348
13,3
81(2
,680
)(7
)(2
,687
)10
,694
(10,
694)
–
Uni
ted
Stat
es d
olla
r48
72,
220
2,70
7(5
,131
)–
(5,1
31)
(2,4
24)
–(2
,424
)
Ring
git M
alay
sia
423
426
849
(484
)–
(484
)36
5(3
65)
–
5,94
310
,994
16,9
37(8
,295
)(7
)(8
,302
)8,
635
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
84EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
26
. F
ina
nci
al
inst
rum
en
ts,
fin
an
cia
l ri
sks
an
d c
ap
ita
l m
an
ag
em
en
t (C
on
tin
ue
d)
26
.2
Ma
rke
t ri
sk (
Co
nti
nu
ed
)
(i)
Fo
reig
n c
urr
en
cy r
isk
(Co
nti
nu
ed
)
Th
e
Gro
up
’s
an
d
the
C
om
pa
ny’
s c
urr
en
cy
exp
osu
re
ba
sed
o
n
the
in
form
ati
on
a
va
ila
ble
to
ke
y m
an
ag
em
en
t is
a
s fo
llo
ws:
(Co
nti
nu
ed
)
2011
Fin
anci
al a
sset
sFi
nan
cial
liab
iliti
es
Co
mp
any
Trad
e
and
oth
er
rece
ivab
les
Cas
h a
nd
cash
equ
ival
ents
Tota
l
Trad
e
and
oth
er
pay
able
s
Fin
ance
leas
e
pay
able
sTo
tal
Net
fin
anci
al
asse
ts
Net
fin
anci
al
asse
ts
den
om
inat
ed
in t
he
resp
ecti
ve
enti
ties
’
fun
ctio
nal
curr
enci
es
Cu
rren
cy
exp
osu
re
2011
$’00
0$’
000
$’00
0$’
000
$’00
0$’
000
$’00
0$’
000
$’00
0
Sing
apor
e do
llar
6,49
61,
906
8,40
2(4
50)
(235
)(6
85)
7,71
7(7
,717
)–
Uni
ted
Stat
es d
olla
r–
1,21
81,
218
––
–1,
218
–1,
218
6,49
63,
124
9,62
0(4
50)
(235
)(6
85)
8,93
5
2010
Sing
apor
e do
llar
9,64
52,
104
11,7
49(5
79)
(7)
(586
)11
,163
(11,
163)
–
Uni
ted
Stat
es d
olla
r–
1,38
81,
388
––
–1,
388
–1,
388
9,64
53,
492
13,1
37(5
79)
(7)
(586
)12
,551
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
85
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
26. Financial instruments, financial risks and capital management (Continued)
26.2 Market risk (Continued)
(i) Foreign currency risk (Continued)
Foreign currency sensitivity analysis
The Group’s and the Company’s exposure to foreign currency risks is mainly in United States dollar.
The following table details the Group’s and the Company’s sensitivity to a 5% increase and decrease
in United States dollar against Singapore dollar. The 5% is used when reporting sensitivity of foreign
currency risk. The sensitivity analysis includes only outstanding United States dollar monetary items and
adjusts their translation at the end of the reporting period for a 5% change in foreign currency rates.
Profit or loss
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
United States dollar
Strengthened 5% (351) (121) 60 69
Weakened 5% 351 121 (60) (69)
The potential impact on profit or loss of the Group as described in the sensitivity analysis above is
attributable mainly to the Group’s and the Company’s foreign currency exchange rate exposure on
monetary assets and monetary liabilities denominated in United States dollar.
(ii) Interest rate risk
Interest rate risk is the risk that the fair value of future cash flows of the Group’s and the Company’s
financial instruments will fluctuate because of changes market interest rate.
No sensitivity analysis is prepared as the Group and the Company do not expect any material effect on
the Group’s profit or loss arising from the effects of reasonably possible changes to interest rates on
interest-bearing financial instruments at the end of the reporting period.
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
86EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
26. Financial instruments, financial risks and capital management (Continued)
26.3 Liquidity risk
Liquidity risks refer to the risks in which the Group and the Company encounter difficulties in meeting short-
term obligations. Liquidity risks are managed by matching the payment and receipt cycle.
The Group and the Company manage their debt maturity profile, operating cash flows and the availability of
funding so as to ensure that all repayment and funding needs are met. As part of the overall prudent liquidity
management, the Group and the Company maintain sufficient levels of cash and available banking facilities to
meet their working capital requirements.
The table below analyses the maturity profile of the Group’s and Company’s financial assets and liabilities based
on contractual undiscounted cash flows.
Within one
financial
year
After one
financial
year but
within five
financial
years
After five
financial
years Total
$’000 $’000 $’000 $’000
Group
2011
Financial assets
Non-interest bearing 19,516 – – 19,516
Variable interest bearing 1,200 – – 1,200
20,716 – – 20,716
Financial liabilities
Non-interest bearing 12,981 – – 12,981
Variable interest bearing 40 197 29 266
13,021 197 29 13,247
2010
Financial assets
Non-interest bearing 14,725 – – 14,725
Variable interest bearing 2,306 – – 2,306
17,031 – – 17,031
Financial liabilities
Non-interest bearing 8,733 – – 8,733
Variable interest bearing 7 1 – 8
8,740 1 – 8,741
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
87
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
26. Financial instruments, financial risks and capital management (Continued)
26.3 Liquidity risk (Continued)
Within one
financial
year
After one
financial
year but
within five
financial
years
After five
financial
years Total
$’000 $’000 $’000 $’000
Company
2011
Financial assets
Non-interest bearing 8,425 – – 8,425
Variable interest bearing 1,200 – – 1,200
9,625 – – 9,625
Financial liabilities
Non-interest bearing 456 – – 456
Variable interest bearing 40 197 29 266
496 197 29 722
2010
Financial assets
Non-interest bearing 11,036 – – 11,036
Variable interest bearing 2,193 – – 2,193
13,229 – – 13,229
Financial liabilities
Non-interest bearing 579 – – 579
Variable interest bearing 7 1 – 8
586 1 – 587
notes to the fi nancial statements
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
88EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
26. Financial instruments, financial risks and capital management (Continued)
26.4 Capital management policies and objectives
The Group and the Company manage their capital to ensure that the Group and the Company will be able
to continue as going concern and to maintain an optimal capital structure so as to maximise shareholders’
value.
The Group and the Company manage their capital structure and make adjustments to it, in light of changes
in economic conditions. To maintain or adjust the capital structure, the Group and the Company may adjust
the return capital to shareholders or issue new share, make dividend payment or obtain new borrowings. No
changes were made in the objectives, policies or processes during the financial year.
The Group and the Company are in compliance with all bank covenants for the financial years ended 30 June
2011 and 2010.
26.5 Fair value of financial assets and financial liabilities
The carrying amounts of the Group’s and the Company’s cash and cash equivalents, finance lease payables,
trade and other receivables and payables approximate their respective fair values due to the relatively short
term maturity of these financial instruments. The fair values non-current liabilities in relation to finance lease
payables are disclosed in Note 13 to the financial statements.
26.6 Categories of financial instruments
The following table sets out the financial instruments as at the end of the reporting period:
Group Company
2011 2010 2011 2010
$’000 $’000 $’000 $’000
Financial assets
Loans and receivables (including cash
and cash equivalents) 20,711 16,937 9,620 13,137
Derivative financial instruments – 45 – 45
Financial liabilities
Amortised cost (including finance lease
payables) 13,202 8,740 685 586
Derivative financial instruments 14 – 6 –
notes to the fi nancial statements
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
89
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
27. Events subsequent to the reporting date
27.1 Capital injection in subsidiaries
On 11 August 2011, the Company injected RMB2,800,000 into Epicentre (Shanghai) Co., Ltd to meet its capital
commitment. The increase did not change the Company’s effective equity interest in the subsidiary.
On 2 September 2011, Epicentre Pte Ltd, a subsidiary, increased its issued and paid-up share capital from
$315,000 comprising 315,000 ordinary shares to $500,000 comprising 500,000 ordinary shares through allotment
and issuance of 185,000 new ordinary shares to the Company for a cash consideration of $185,000.
On 7 September 2011, Epicentre Lifestyle Sdn. Bhd., a subsidiary, increased its issued and paid-up share capital
from approximately $129,000 (RM300,000) comprising 300,000 ordinary shares to approximately $332,000
(RM800,000) comprising 800,000 ordinary shares through allotment and issuance of 800,000 new ordinary shares
to the Company for a cash consideration of approximately $203,000 (RM500,000).
28. Comparative information
During the current financial year, the Group and the Company have presented “prepayments” separately from the “trade
and other receivables” on the face of the statements of financial position of the Group and the Company to better reflect
the nature of the accounts. Accordingly, the comparative figures of the Group and the Company have been reclassified
for consistency. As a result, certain line items have been amended on the face of the statements of financial position
of the Group and the Company and the consolidated statement of cash flows as follows:
Group Company
As previously
reported
After
reclassification
As previously
reported
After
reclassification
$’000 $’000 $’000 $’000
Statements of financial position
2010
Trade and other receivables 6,330 5,943 9,864 9,645
Prepayments – 387 – 219
Consolidated statement of cash flows
2010
Trade and other receivables (2,457) (2,365) – –
Prepayments – (122) – –
The reclassification has no effect on the reported profit or loss, total income and expense or net assets for the period
reported. Accordingly, the management did not present statements of financial position of the Group and the Company
at the beginning of the earliest comparative period.
statistics of shareholdingsAS AT 20 SEPTEMBER 2011
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
90EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
SHAREHOLDERS’ INFORMATION AS AT 20 SEPTEMBER 2011
Total Number of Shares : 93,501,600
Class of Shares : Ordinary Shares
Voting Rights : One vote per ordinary share (excluding treasury shares)
Treasury Shares : Nil
DISTRIBUTION OF SHAREHOLDINGS
Size of Shareholdings
No. of
Shareholders %
No. of
Shares %
1 – 999 0 0.00 0 0.00
1,000 – 10,000 515 71.93 2,183,000 2.34
10,001 – 1,000,000 193 26.95 15,422,000 16.49
1,000,001 and above 8 1.12 75,896,600 81.17
TOTAL 716 100.00 93,501,600 100.00
TOP TWENTY SHAREHOLDERS
Name No. of Shares %
1. FONG TECK LOON 50,369,800 53.87
2. GOH ANN ANN JOHNSON 10,710,000 11.45
3. ROWSLEY SPORTS PTE LTD 4,861,000 5.20
4. DBS NOMINEES PTE LTD 3,168,000 3.39
5. LAM WAI HENG 2,538,800 2.72
6. LI CHOW CHIN 1,639,000 1.75
7. LIM & TAN SECURITIES PTE LTD 1,510,000 1.61
8. ABN AMRO NOMINEES SINGAPORE PTE LTD 1,100,000 1.18
9. RAFFLES NOMINEES (PTE) LTD 881,000 0.94
10. CITIBANK NOMINEES SINGAPORE PTE LTD 832,000 0.89
11. HONG LEONG FINANCE NOMINEES PTE LTD 800,000 0.86
12. BRENDA YEO 630,000 0.67
13. LEONG MEE WAN 500,000 0.53
14. CHEW BEE CHOO 472,000 0.50
15. CIMB SECURITIES (SINGAPORE) PTE LTD 420,000 0.45
16. MERRILL LYNCH (SINGAPORE) PTE LTD 398,000 0.43
17. CHAN MUN-E 350,000 0.37
18. LAI WENG KAY 320,000 0.34
19. RUPERT JAMES PHILIP MORTON 258,000 0.28
20. DMG & PARTNERS SECURITIES PTE LTD 248,000 0.27
TOTAL 82,005,600 87.70
The percentage of shareholding above is computed based on the total issued shares of 93,501,600.
statistics of shareholdingsAS AT 20 SEPTEMBER 2011
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
91
SUBSTANTIAL SHAREHOLDERS
(As recorded in the Register of Substantial Shareholders)
Direct Interest % Deemed Interest %
Jimmy Fong Teck Loon(1) 50,369,800 53.87 630,000 0.67
Brenda Yeo(1) 630,000 0.67 50,369,800 53.87
Johnson Goh Ann Ann 10,710,000 11.45 – –
Rowsley Sports Pte. Ltd. 4,861,000 5.20 – –
Rowsley Ltd(2) – – 4,861,000 5.20
Garville Pte Ltd(2) – – 4,861,000 5.20
Lim Eng Hock(2) – – 4,861,000 5.20
Notes:–
(1) Mr Jimmy Fong Teck Loon is deemed to be interested in the 630,000 shares held by his wife, Ms Brenda Yeo and vice versa by virtue
of Section 7 of the Companies Act, Cap. 50.
(2) Rowsley Ltd, Garville Pte Ltd and Lim Eng Hock are deemed to be interested in the 4,861,000 shares held by Rowsley Sports Pte. Ltd.
by virtue of Section 7 of the Companies Act, Cap. 50.
PERCENTAGE OF SHAREHOLDING IN PUBLIC’S HANDS
28.7% of the Company’s shares are held in the hands of public. Accordingly, the Company has complied with Rule 723 of the
Listing Manual Section B: Rules of Catalist of the SGX-ST.
addendum
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
92EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
ADDENDUM DATED 11 OCTOBER 2011
THIS ADDENDUM IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.
This addendum (the “Addendum”) is circulated to the shareholders of Epicentre Holdings Limited (the “Company”) together
with the Company’s annual report for financial year ended 30 June 2011. The purpose of this Addendum is to provide the
shareholders of Epicentre Holdings Limited with relevant information relating to and to seek shareholders’ approval to renew
the share buyback mandate to be tabled at the Annual General Meeting to be held at 1 Orchid Club Road, Orchid Country
Club Level 1, Golf Clubhouse, Octagon, Singapore 769162, on Friday, 28 October 2011 at 10.00 a.m..
If you are in any doubt as to the action you should take, you should consult your stockbroker, bank manager, solicitor,
accountant, tax adviser or other professional adviser immediately.
If you have sold or transferred all your shares in the capital of Epicentre Holdings Limited, you should immediately send this
Addendum, the Notice of Annual General Meeting and the Proxy Form to the purchaser or transferee or to the bank, stockbroker
or agent through whom the sale or transfer was effected for onward transmission to the purchaser or transferee.
The Notice of the Annual General Meeting and the Proxy Form are enclosed with the Annual Report 2011.
The Singapore Exchange Securities Trading Limited (“SGX-ST”) has not examined the contents of this Addendum. The SGX-ST
assumes no responsibility for the contents of this Addendum, including the correctness of any of the statements or opinions
made or reports contained in this Addendum.
This Addendum has been prepared by the Company and its contents have been reviewed by the Company’s sponsor
(“Sponsor”), Asian Corporate Advisors Pte. Ltd. (“Asian Corporate Advisors”), for compliance with the relevant rules of the
SGX-ST. The Company’s Sponsor has not independently verified the contents of this Addendum including the correctness of
any of the figures used, statements or opinions made. The contact person for the Sponsor is Mr Liau H.K. Telephone number:
6221 0271.
Epicentre Holdings Limited(Company Registration No: 200202930G)
(Incorporated in the Republic of Singapore)
ADDENDUM TO ANNUAL REPORT IN RELATION TO THEPROPOSED RENEWAL OF THE SHARE BUYBACK MANDATE
addendum
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
93
DEFINITIONS
For the purpose of this Addendum, the following definitions apply throughout, unless the context otherwise requires:
“ACRA” Accounting and Corporate Regulatory Authority of Singapore
“Act” or “Companies Act” Companies Act (Chapter 50) of Singapore, as amended or modified from time to
time
“Addendum” This Addendum to Shareholders dated 11 October 2011 in relation to the proposals
as set out in section 1.1
“AGM” or “Annual General
Meeting”
The annual general meeting of the Company to be held at 1 Orchid Club Road,
Orchid Country Club Level 1, Golf Clubhouse, Octagon, Singapore 769162 on Friday,
28 October 2011 at 10.00 a.m., to approve, inter-alia, the adoption of a share buyback
mandate in accordance with the terms and conditions as set out in this Addendum
as well as the Companies Act and the Catalist Rules
“Board” or “Directors” The board of directors or directors of the Company, including executive, non-
executive, independent and non-independent directors of the Company for the
time being
“Catalist Rules” The provisions of Section A and Section B: Rules of Catalist of the SGX-ST of the Listing
Manual (excluding the Best Practices Guide, the Code, and the Practice Notes) as
amended, supplemented or modified from time to time
“CDP” The Central Depository (Pte) Limited
“Companies Amendment Act 2005” Companies (Amendment) Act 2005 of Singapore
“Company” or “Epicentre” Epicentre Holdings Limited
“Director” A director of the Company
“EPS” Earnings per Share
“FY” Financial year ended or ending 30 June (as the case may be) unless other specified
“Group” The Company and its subsidiaries, collectively
“Latest Practicable Date” The latest practicable date prior to the printing of this Addendum, being 4 October
2011
“Listing Manual” The listing manual of the SGX-ST, as amended, supplemented or modified from time
to time
“Market Day” A day on which the SGX-ST is open for trading in securities
addendum
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
94EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
“Notice of AGM” The notice of AGM found in the annual report of the Company for 2011, for the
purposes of considering and, if thought fit, passing with or without modifications,
the resolutions as set out therein
“NTA” Net tangible assets of the Group
“Securities Account” A securities account maintained by a Depositor with CDP but does not include a
securities sub-account
“SGX Catalist” or “Catalist” Catalist, a market regulated by the SGX-ST, formerly known as the SGX-ST Dealing
and Automated Quotation System
“SGX-ST” Singapore Exchange Securities Trading Limited
“SGXNET” The SGXNET Corporate Announcement System
“Share Buyback” The buy back of Shares by the Company in accordance with the terms set out in this
Addendum as well as the Companies Act and the Catalist Rules
“Share Buyback Mandate” General mandate to be given by the Shareholders to authorise the Directors to effect
Share Buyback
“Shareholder(s)” Registered holders of Shares in the Register of Members of the Company, except
that where the registered holder is CDP, the term “Shareholders” shall, in relation to
such Shares and where the context so admits, mean the Depositors in the Depository
Register maintained by the CDP and whose Securities Accounts are credited with
those Shares. Any reference to Shares held by or shareholdings of Shareholders shall
include Shares standing to the credit of their respective Securities Accounts
“Shares” Ordinary shares in the capital of the Company and each a “Share”
“Sponsor” Asian Corporate Advisors Pte. Ltd.
“Substantial Shareholder” A person who has an interest (directly or indirectly) of five per cent. (5%) or more of
the total issued share capital of the Company
“Take-over Code” The Singapore Code of Takeovers and Mergers, as amended or modified from time
to time
“Treasury Share(s)” (a) A Share which was (or is treated as having been) purchased by the Company
in circumstances in which Section 76H of the Act applies; and
(b) Has been held by the Company continuously since the treasury share was so
purchased.
“Unit Share Market” The unit share market of the SGX-ST which allows trading of shares in single shares.
addendum
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
95
Currencies, Units and Others
“S$” and “cents” or “˘F” Singapore dollars and cents, respectively
“%” or “per cent.” Percentage or per centum
The terms “Depositor”, “Depository Agent” and “Depository Register” shall have the meanings ascribed to them respectively
by Section 130A of the Act. The term “Direct Account Holder” shall have the meaning ascribed to the term “account holder”
in Section 130A of the Act.
Words importing the singular shall, where applicable, include the plural and vice versa and words importing the masculine
gender shall, where applicable, include the feminine and neuter genders. References to persons shall include corporations.
Any reference in this Addendum to any enactment is a reference to that enactment as for the time being amended or re-
enacted. Any term or word defined under the Securities and Futures Act (Chapter 289) of Singapore or the Companies Act or
the Catalist Rules or any statutory or regulatory modification thereof and used in this Addendum shall where applicable have
the same meaning ascribed to it under the Securities and Futures Act (Chapter 289) of Singapore, the Companies Act or the
Catalist Rules or such statutory modification, as the case may be, unless otherwise provided.
All discrepancies in the figures included herein between the listed amounts and totals thereof are due to rounding. Accordingly,
figures shown as totals in this Addendum may not be an arithmetic aggregation of the figures that precede them.
Any reference to a time of a day in the Addendum is a reference to Singapore time unless otherwise stated and shall include
such other date(s) or time(s) as may be announced from time to time by or on behalf of the Company.
addendum
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
96EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
EPICENTRE HOLDINGS LIMITED(Company Registration No: 200202930G)
(Incorporated in the Republic of Singapore)
Directors Registered Office
Mr Jimmy Fong Teck Loon (Executive Chairman and Chief Executive Officer) 37 Jalan Pemimpin
Ms Brenda Yeo (Executive Director) #07-04 Clarus Centre
Mr Siow Chee Keong (Lead Independent Director) Singapore 577177
Mr Azman Hisham Bin Jaafar (Independent Director) Tel No.: +65 6601 9100
Mr Ron Tan Aik Ti (Independent Director) Fax No.: +65 6601 9133
11 October 2011
To: The shareholders of Epicentre Holdings Limited
Dear Sir or Madam
We refer to item 14 of the Notice of AGM for the Company, which is an ordinary resolution to be proposed at the AGM for the
renewal of the Company’s Share Buyback Mandate (“Resolution 14”). The purpose of this Addendum is to provide Shareholders
with information relating to Resolution 14.
1. THE PROPOSED RENEWAL OF THE SHARE BUYBACK MANDATE
1.1 Background
At the October 2010 AGM, Shareholders had approved, inter alia, the adoption of a Share Buyback Mandate to enable
the Company to purchase or otherwise acquire Shares.
The Share Buyback Mandate which was previously approved on 29 October 2010 will expire on the date of the
forthcoming AGM to be held on 28 October 2011. Accordingly, the Directors propose that the Share Buyback Mandate
be renewed at the forthcoming AGM.
Approval is being sought from Shareholders at the AGM for the adoption of a Share Buyback Mandate for the purchase
by the Company of its issued Shares. If approved, the Share Buyback Mandate will take effect from the date of the AGM
and continue in force until the date of the next annual general meeting of the Company or such date as the next annual
general meeting is required by law to be held, unless prior thereto, Share Buybacks are, carried out to the full extent
mandated or the Share Buyback Mandate is revoked or varied by the Company in a general meeting. The Share Buyback
Mandate will be put to Shareholders for renewal at each subsequent annual general meeting of the Company.
addendum
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
97
1.2 Rationale for the Share Buyback Mandate
The rationale for the Company to undertake the purchase or acquisition of its issued Shares is as follows:–
(a) Directors and management are constantly seeking to increase Shareholders’ value and to improve, inter alia, the
return on equity of the Group. The purchase by a company of its issued shares at the appropriate price level is
one of the ways through which the return on equity of the Group may be enhanced;
(b) The Share Buyback Mandate will give the Directors the flexibility to purchase or acquire Shares as and when
circumstances permit. The Directors believe that the Share Buyback Mandate provides the Company and its
Directors with a mechanism to facilitate the use of surplus cash over and above the Company’s ordinary working
capital requirements, in an expedient and cost-efficient manner;
(c) The Share Buyback Mandate would also allow the Directors to exercise greater control over the Company’s
share capital structure, dividend policy and cash reserves and may lead to an enhancement of EPS and/or NTA
per Share of the Company and the Group;
(d) The Directors further believe that a Share Buyback by the Company may help mitigate short-term market or price
volatility, offset the effects of short-term share speculation or demand and bolster Shareholders’ confidence;
and
(e) The Share Buyback Mandate will only be exercised as and when the Directors consider it to be in the best
interests of the Company taking into consideration factors such as market conditions and funding arrangements
as applicable, and in appropriate circumstances which the Directors believe will not result in any material adverse
effect on the liquidity and the orderly trading of the Shares, as well as the working capital requirements and the
gearing level of the Group.
Shareholders should note that purchases of Shares pursuant to the Share Buyback Mandate may not be carried out to
the full limit as authorised.
1.3 Authority and Limits of the Share Buyback Mandate
The authority and limitations placed on purchases or acquisitions of Shares by the Company under the Share Buyback
Mandate, if renewed at the forthcoming AGM, are the same as previously approved by Shareholders at the October
2010 AGM. The authority and limitations, subject to compliance with the Companies Act and the Catalist Rules as well
as such other rules, laws or regulations as may be applicable, are summarised below:–
1.3.1 Maximum Number of Shares
Only Shares which are issued and fully paid-up may be purchased or acquired by the Company. The total number
of Shares that may be purchased or acquired is limited to that number of Shares representing not more than
ten per cent. (10%) of the issued ordinary share capital of the Company as at the date of the respective general
meetings at which the Share Buyback Mandate is approved or renewed (as the case may be).
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Purely for illustrative purposes, on the basis of 93,501,600 Shares in issue as at the Latest Practicable Date, and
assuming that no further Shares are issued on or prior to the AGM, not more than 9,350,160 (representing
approximately ten per cent. (10%) of the total number of issued Shares (excluding Treasury Shares) may be
purchased or acquired by the Company pursuant to the Share Buyback Mandate.
1.3.2 Duration of Authority
Purchases of Shares may be made, at any time and from time to time, on and from the date of approval up to
the earliest of the date on which:–
(a) the next annual general meeting of the Company is held or required by law to be held;
(b) Share Buybacks have been carried out to the full extent mandated; or
(c) the authority contained in the Share Buyback Mandate is varied or revoked.
1.3.3 Manner of Purchase of Shares
Purchases or acquisitions of Shares can be effected by the Company by way of:–
(a) on-market purchases transacted through the Exchange’s Central Limited Order Book Trading System on
Catalist through the ready market through one or more duly licensed stock brokers appointed by the
Company for the purpose of the Share Buyback (“On-Market Purchases”); and/or
(b) an off-market (if effected otherwise than on Catalist) in accordance with any equal access scheme as
defined in Section 76C of the Companies Act, and otherwise in accordance with all other applicable laws
and regulations and Catalist Rules (“Off-Market Purchase”).
The Directors may impose such terms and conditions, which are consistent with the Share Buyback Mandate,
the Catalist Rules and the Companies Act, as they consider fit in the interests of the Company in connection
with or in relation to an equal access scheme or schemes. Under the Companies Act, an equal access scheme
must satisfy all the following conditions:–
(a) offers for the purchase or acquisition of issued Shares shall be made to every person who holds issued
Shares to purchase or acquire the same percentage of their issued Shares;
(b) all of the abovementioned persons shall be given a reasonable opportunity to accept the offers made;
and
(c) the terms of all the offers shall be the same, except that there shall be disregarded:
(i) differences in consideration attributable to the fact that the offers may relate to Shares with
different accrued dividend entitlements;
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(ii) (if applicable) differences in consideration attributable to the fact that the offers relate to Shares
with different amounts remaining unpaid; and
(iii) differences in the offers introduced solely to ensure that each person is left with a whole number
of Shares.
In addition, if the Company wishes to make an Off-Market Purchase in accordance with an equal access scheme,
the Company must, as required by the Catalist Rules, issue an offer document to all Shareholders containing at
least the following information:–
(a) the terms and conditions of the offer;
(b) the period and procedures for acceptances;
(c) the reasons for the proposed Share Buyback;
(d) the consequences, if any, of Share Buyback by the Company that will arise under the Take-over Code or
other applicable take-over rules;
(e) whether the Share Buyback, if made, would have any effect on the listing of the Shares on the Catalist;
(f) details of any Share Buyback made by the Company in the previous twelve (12) months (whether On-
Market Purchases or Off-Market Purchases), giving the total number of Shares purchased, the purchase
price per Share or the highest and lowest prices paid for the purchases, where relevant, and the total
consideration paid for the purchases; and
(g) whether the Shares purchased by the Company will be cancelled or held as Treasury Shares.
1.3.4 Maximum Purchase Price
The purchase price to be paid for a Share in the event of any Share Buyback shall not exceed the Maximum
Price (as defined below), which:
(a) in the case of On-Market Purchases, shall mean the price per Share based on not more than five per cent.
(5%) above the average of the closing market prices of the Shares over the last five (5) Market Days on
the Catalist, on which transactions in the Shares were recorded immediately preceding the day of the
market purchase by the Company and deemed to be adjusted for any corporate action occurring after
the relevant five (5) day period; and
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(b) in the case of Off-Market Purchases, shall mean the price per Share based on not more than twenty per
cent. (20%) above the average of the closing market prices of the Shares over the last five (5) Market
Days on the Catalist, on which transactions in the Shares were recorded immediately preceding the day
on which the Company makes an announcement of an offer under an equal access scheme,
in either case, excluding related expenses of the purchase or acquisition (the “Maximum Price”).
For the above purposes, “Average Closing Price” means the average of the closing market prices of the Shares
over the last five (5) Market Days on which transactions in the Share were recorded on the Catalist immediately
preceding the date of the On-Market Purchase by the Company, or as the case may be, the date of the making
of the offer pursuant to the Off-Market Purchase, and deemed to be adjusted for any corporate action that
occurs after the relevant five (5) day period.
“date of making of the offer” means the date on which the Company announces its intention to make an
offer for the purchase or acquisition of Shares from Shareholders, stating therein the relevant terms of the equal
access scheme for effecting the Off-Market Purchase.
1.4 Status of Purchased Shares
Under Section 76B of the Companies Act, any Shares purchased or acquired by the Company through a Share Buyback
shall be deemed to be cancelled immediately on purchase or acquisition (and all rights and privileges attached to the
Share will expire on such cancellation) unless held as Treasury Shares in accordance with Section 76H of the Companies
Act.
Pursuant and subject to the Companies Act, Shares are deemed to be purchased or acquired on the date on which the
Company would become entitled to exercise the rights attached to the shares.
Some of the provisions on Treasury Shares under the Companies Act are summarised below:
(a) The number of shares held as Treasury Shares cannot at any time exceed 10% of the total number of shares
issued by a company. The Company shall be entered in its register of members as the member holding those
shares.
(b) Where shares purchased or acquired by the Company are held as Treasury Shares, the Company may at any
time:
(i) sell the Treasury Shares for cash;
(ii) transfer the Treasury Shares for the purposes of or pursuant to an employees’ share scheme;
(iii) transfer the Treasury Shares as consideration for the acquisition of shares in or assets of another company
or assets of a person;
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101
(iv) cancel the Treasury Shares (or any of them); or
(v) sell, transfer or otherwise use the Treasury Shares for such other purposes as may be prescribed by the
Minister for Finance.
(c) Where shares purchased or acquired by a company are cancelled, such shares will be automatically de-listed by
the SGX-ST. Certificates in respect of such cancelled shares will be cancelled and destroyed by the Company as
soon as is reasonably practicable after the shares have been acquired.
(d) The shares held in treasury shall be treated as having no voting rights and shall not be entitled to any dividend
or other distribution (whether in cash or otherwise) of the Company’s assets (including any distribution of assets
to members on a winding up).
However, the allotment of shares as fully paid bonus shares in respect of treasury shares is allowed. Also, a sub-division
or consolidation of any treasury share into Treasury Shares of a smaller or larger amount is allowed so long as the total
value of the Treasury Shares after the sub-division or consolidation is the same as before.
1.5 Sources of funds
Previously, any purchase of Shares could only be made out of the Company’s distributable profits that are available for
payment as dividends. However the Companies Act, as amended by the Companies Amendment Act 2005, now permits
the Company to also purchase its own Shares out of capital, as well as from its distributable profits, provided that:–
(a) the Company is able to pay its debts in full at the time it purchases the Shares and will be able to pay its debts
as they fall due in the normal course of business in the twelve (12) months immediately following the purchase;
and
(b) the value of the Company’s assets is not less than the value of its liabilities (including contingent liabilities)
and will not after the purchase of Shares become less than the value of its liabilities (including contingent
liabilities).
Further, for the purpose of determining the value of a contingent liability, the Directors or managers of the Company
may take into account the following:
(a) the likelihood of the contingency occurring; and
(b) any claim the Company is entitled to make and can reasonably expect to be met to reduce or extinguish the
contingent liability.
The Company intends to use its internal resources and/or external borrowings to finance purchases of its Shares pursuant
to the proposed Share Buyback Mandate.
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1.6 Financial Effects of the Share Buyback Mandate
It is not possible for the Company to realistically calculate or quantify the financial effects on the Company and the
Group arising from purchases or acquisitions of Shares that may be made pursuant to the Share Buyback Mandate on
the NTA and EPS as the resultant effect would depend on, inter alia, the aggregate number of Shares purchased or
acquired, whether the purchase or acquisition is made out of capital or profits, the purchase price paid for such Shares
and the amount borrowed (if any) by the Company to fund the purchase or acquisition of the Shares and whether the
Shares purchased or acquired are cancelled or held as Treasury Shares.
The financial effects on the Company and the Group, based on the audited financial statements of the Company and
the Group for the financial year ended 30 June 2011, are based on the assumptions set out below:
Share Buyback made out of capital or profits
Under the Companies Act, Share Buyback may be made out of the Company’s profits and/or capital so long as the
Company is solvent.
Where the consideration paid by the Company for a Share Buyback is made out of profits, such consideration (excluding
related brokerage, goods and services tax, stamp duties and other related expenses) will correspondingly reduce the
amount available for the distribution of cash dividends by the Company. Where the consideration paid by the Company
for Share Buyback is made out of capital, the amount available for the distribution of cash dividends by the Company
will not be reduced.
Maximum Price to be Paid for Share Buyback
Based on 93,501,600 Shares in issue as at the Latest Practicable Date, the exercise in full of the Share Buyback Mandate
will result in the purchase or acquisition of 9,350,160 Shares, representing approximately ten per cent. (10%) of the
issued Shares.
For illustrative purposes only, in the case of an On-Market Purchase by the Company and assuming that the Company
purchases or acquires the 9,350,160 Shares at the Maximum Price of approximately 0.5544 for one Share (being
five per cent. (5%) above the average of the closing market prices of the Shares over the last five Market Days on
which transactions in the Shares were recorded on the Catalist immediately preceding the Latest Practicable Date),
the maximum amount of funds required for the purchase or acquisition of the 9,350,160 Shares is approximately
S$5.2 million.
For illustrative purposes only, in the case of an Off-Market Purchase by the Company and assuming that the Company
purchases or acquires the 9,350,160 Shares at the Maximum Price of approximately 0.6336 for one Share (being the
price equivalent to twenty per cent. (20%) above the average of the closing market prices of the Shares over the last
five Market Days on which transactions in the Shares were recorded on the Catalist immediately preceding the Latest
Practicable Date), the maximum amount of funds required for the purchase or acquisition of the 9,350,160 Shares is
approximately S$5.9 million.
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103
For illustrative purposes, on the basis of the foregoing assumptions, the financial effects of the purchase or acquisition
of such Shares by the Company on the audited accounts of the Company and the Group for the financial year ended
30 June 2011 are set out in the following pages.
As at 30 June 2011
ON-MARKET PURCHASES
(A) Purchases made entirely out of capital and cancelled
(B) Purchases made entirely out of capital and held as Treasury Shares
Group Company
Before
Share
Buyback
After Share
Buyback
and
cancelled(1)
After Share
Buyback
and held
as Treasury
Shares(1)
Before
Share
Buyback
After Share
Buyback
and
cancelled(1)
After Share
Buyback
and held
as Treasury
Shares(1)
(‘000) (‘000) (‘000) (‘000) (‘000) (‘000)
As at 30 June 2011
Total equity 19,732 14,548 14,548 11,183 5,999 5,999
NTA(2) 19,509 14,325 14,325 10,960 5,776 5,776
Current assets 31,341 28,749 28,749 9,696 7,104 7,104
Current liabilities 14,064 16,656 16,656 541 3,133 3,133
Working capital 17,277 12,093 12,093 9,155 3,971 3,971
Total borrowings(3) 235 2,827 2,827 235 2,827 2,827
Number of Shares(4) 93,501,600 84,151,440 93,501,600 93,501,600 84,151,440 93,501,600
Financial ratios
NTA per Share (cents) 20.86 17.02 15.32 11.72 6.86 6.18
Gearing(5) (%) 1.19 19.43 19.43 2.10 47.12 47.12
Current Ratio(6) (times) 2.23 1.73 1.73 17.92 2.27 2.27
Notes:
(1) The above is calculated on the assumption that Share Buybacks by the Group are funded by 50% of internal sources
of funds and 50% of current borrowings with no interest charge on the borrowings.
(2) NTA equals total equity less intangible assets.
(3) Total borrowings equal aggregate of short-term loans, long-term loans and finance lease obligations.
(4) Based on issued Share capital of 93,501,600 Shares as at 30 June 2011.
(5) Gearing equals total borrowings divided by total equity.
(6) Current ratio equals current assets divided by current liabilities.
(7) All discrepancies in the figures included herein between the listed and total amounts thereof are due to rounding.
Accordingly, figures shown as totals in this addendum may not be an arithmetic aggregation of the figures that
precede them.
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104EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
OFF-MARKET PURCHASES
(A) Purchases made entirely out of capital and cancelled
(B) Purchases made entirely out of capital and held as Treasury Shares
Group Company
Before
Share
Buyback
After Share
Buyback
and
cancelled(1)
After Share
Buyback
and held
as Treasury
Shares(1)
Before
Share
Buyback
After Share
Buyback
and
cancelled(1)
After Share
Buyback
and held
as Treasury
Shares(1)
(‘000) (‘000) (‘000) (‘000) (‘000) (‘000)
As at 30 June 2011
Total equity 19,732 13,808 13,808 11,183 5,259 5,259
NTA(2) 19,509 13,585 13,585 10,960 5,036 5,036
Current assets 31,341 28,379 28,379 9,696 6,734 6,734
Current liabilities 14,064 17,026 17,026 541 3,503 3,503
Working capital 17,277 11,353 11,353 9,155 3,231 3,231
Total borrowings(3) 235 3,197 3,197 235 3,197 3,197
Number of Shares(4) 93,501,600 84,151,440 93,501,600 93,501,600 84,151,440 93,501,600
Financial ratios
NTA per Share (cents) 20.86 16.14 14.53 11.72 5.98 5.39
Gearing(5) (%) 1.19 23.15 23.15 2.11 60.79 60.79
Current Ratio(6) (times) 2.23 1.67 1.67 17.92 1.92 1.92
Notes:
(1) The above is calculated on the assumption that Share Buybacks by the Group are funded by 50% of internal sources
of funds and 50% of current borrowings with no interest charge on the borrowings.
(2) NTA equals total equity less intangible assets.
(3) Total borrowings equal aggregate of short-term loans, long-term loans and finance lease obligations.
(4) Based on issued Share capital of 93,501,600 Shares as at 30 June 2011.
(5) Gearing equals total borrowings divided by total equity.
(6) Current ratio equals current assets divided by current liabilities.
(7) All discrepancies in the figures included herein between the listed and total amounts thereof are due to rounding.
Accordingly, figures shown as totals in this addendum may not be an arithmetic aggregation of the figures that
precede them.
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105
The actual impact will depend on the number and price of the Shares bought back. The Directors do not propose to
exercise the Share Buyback Mandate to such an extent that it would have a material adverse effect on the working capital
requirements and capital adequacy position of the Company. Share Buyback will only be effected after assessing the
relative impact of a Share Buyback taking into consideration both financial factors (such as cash surplus, debt position
and working capital requirements) and non-financial factors (such as share market conditions and performance of the
Shares). The Directors will be prudent in exercising the Share Buyback Mandate only to such extent which the Directors
believe will enhance Shareholders’ value giving consideration to the prevailing market conditions, the financial position
of the Group and other relevant factors.
Shareholders should note that the financial effects illustrated above are based on certain assumptions and
are purely for illustration purposes only. In particular, it is important to note that the above analysis is based
on the audited accounts of the Company and the Group as at 30 June 2011 is not necessarily representative
of the future financial performance of the Group or the Company or the Shares.
Although the Share Buyback Mandate would authorise the Company to buy back up to ten per cent. (10%)
of the Company’s issued Shares, the Company may not necessarily buy back or be able to buy back the total
number of Shares that may be purchased or acquired in accordance to or as permitted under the Share
Buyback Mandate. In addition, the Company may cancel all or part of the Shares repurchased or hold all or
part of the Shares repurchased as Treasury Shares.
1.7 Requirements under the Companies Act and Catalist Rules
Within thirty (30) days of the passing of a Shareholders’ resolution to approve the Share Buyback Mandate, the Company
shall lodge a copy of such resolution with ACRA.
Within thirty (30) days of a Share purchase or acquisition on the Catalist or otherwise, the Company shall lodge with
ACRA a notification of the Share purchase or acquisition in the prescribed form. Such notification shall include, inter
alia, the date of the purchase, the number of Shares purchased, the number of Shares cancelled and/or the number of
Shares held as Treasury Shares, the Company’s issued share capital before and after the Share purchase, the amount
of consideration paid by the Company for the purchase and whether the Shares were purchased out of the profits or
capital of the Company.
Under the Catalist Rules, a listed company may purchase shares by way of On-Market Purchases at a price per share
which is, inter alia, not more than five per cent. (5%) above the average of the closing market prices of the shares
over the last five (5) Market Days, on which transactions in the shares were recorded, preceding the day on which the
purchases were made (the “average closing market price”). The Maximum Price for a Share in relation to On-Market
Purchases by the Company conforms to this restriction.
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The Catalist Rules also specify that a listed company shall announce all purchases or acquisitions of its shares via SGXNET
not later than 9.00 a.m.:–
(a) in the case of an On-Market Purchase, on the Market Day following the day of purchase of any of its shares;
and
(b) in the case of an Off-Market Purchase under an equal access scheme, by 9.00 a.m. on the second Market Day
after the close of acceptances of the offer.
Such announcement shall be in the form of Appendix 8D of the Catalist Rules which includes, without limitation, details
of the total number of shares authorised for purchase, the date of purchase, prices paid for the total number of shares
purchased, the purchase price per share, the highest and lowest shares purchased to date and the number of issued
shares after purchase.
While the Catalist Rules do not expressly prohibit any purchase of shares by a listed company during any particular
time(s), because the listed company would be regarded as an “insider” in relation to any proposed purchase or
acquisition of its issued shares, the Company will not undertake any purchase of Shares pursuant to the Share Buyback
Mandate at any time after any matter or development of a price-sensitive nature has occurred or has been the subject
of consideration and/or a decision of the Board until such price-sensitive information has been publicly announced.
In particular, in line with the best practices guide on securities dealings under Rule 1204(18) of the Catalist Rules, the
Company will not purchase or acquire any Shares through On-Market Purchases and/or Off-Market Purchases during
the period of one month immediately preceding the announcement of the half year or the annual (full-year) results.
1.8 Listing Status
The Company is required under Rule 723 of the Catalist Rules to ensure that at least ten per cent. (10%) of its Shares
are in the hands of the public at all times. The “public”, as defined under the Catalist Rules, are persons other than the
Directors, chief executive officer, substantial shareholders or controlling shareholders of the Company and its subsidiaries,
as well as the associates (as defined in the Catalist Rules) of such persons.
As at the Latest Practicable Date, there are 26,830,800 Shares in the hands of the public (as defined above), representing
approximately 28.7 per cent. (28.7%) of the issued share capital of the Company. Assuming that the Company purchases
its Shares through Market Purchases up to the full ten per cent. (10%) limit pursuant to the Share Buyback Mandate and
all such Shares purchased are held by the public, the number of Shares in the hands of the public would be reduced
by approximately 9,350,160 Shares, the resultant percentage of the issued Shares held by public Shareholders would
be reduced to approximately 20.8 per cent. (20.8%). Accordingly, based on the data available as the Latest Practicable
Date as aforesaid, and assuming that there is no change in the individual shareholdings of the respective public and
non-public shareholders of the Company, the Company is of the view that there is a sufficient number of the Shares
in issue held by public Shareholders which would permit the Company to undertake purchases or acquisitions of its
Shares through On-Market Purchases up to the full ten per cent. (10%) limit pursuant to the Share Buyback Mandate
without affecting the listing status of the Shares on the Catalist and the number of Shares remaining on the hands of
the public will not fall to such a level as to cause market illiquidity.
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In undertaking any purchases of its Shares through Market Purchases, the Directors will use their best efforts to ensure
that a sufficient number of Shares remain in public hands so that the Share Buyback(s) will not:–
(a) adversely affect the listing status of the Shares on the Catalist; or
(b) adversely affect the orderly trading of Shares.
1.9 Take-over Implications
Appendix 2 of the Take-over Code contains the Share Buy-Back Guidance Note applicable as at the Latest Practicable
Date. The take-over implications arising from any purchase or acquisition by the Company of its Shares are set out
below.
(i) Under Appendix 2 of the Take-over Code, an increase of a Shareholder’s proportionate interest in the voting
rights of the Company resulting from a Share Buyback by the Company will be treated as an acquisition for the
purpose of Rule 14 of the Take-over Code (“Rule 14”). Consequently, a Shareholder or group of Shareholders
acting in concert with a Director could obtain or consolidate effective control of the Company, and become
obligated to make a take-over offer for the Company under Rule 14.
(ii) Pursuant to Rule 14, a Shareholder and persons acting in concert with the Shareholder will incur an obligation
to make a mandatory take-over offer if, inter alia, he and persons acting in concert with him increase their voting
rights in the Company to thirty per cent. (30%) or more or, if they, together holding between thirty per cent.
(30%) and fifty per cent. (50%) of the Company’s voting rights, increase their voting rights in the Company by
more than one per cent. (1%) in any period of six (6) months.
(iii) 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 effective control of that company. Unless the contrary is established, the following persons will be
presumed to be acting in concert, namely (i) a company with any of its Directors; and (ii) a company, its parent,
subsidiaries and fellow subsidiaries, and their associated companies, and companies of which such companies
are associated companies, all with each other. For this purpose, ownership or control of at least twenty per cent.
(20%) but not more than fifty per cent. (50%) of the voting rights of a company will be regarded as the test of
associated company status.
(iv) The effect of Rule 14 and Appendix 2 of the Take-over Code is that, unless exempted, Directors and persons
acting in concert with them will incur an obligation to make a take-over offer under Rule 14 if, as a result of the
Company purchasing or acquiring its Shares, the voting rights of such Directors and their concert parties would
increase to thirty per cent. (30%) or more, or if the voting rights of such Directors and their concert parties fall
between thirty per cent. (30%) and fifty per cent. (50%) of the Company’s voting rights, the voting rights of
such Directors and their concert parties would increase by more than one per cent. (1%) in any period of six
(6) months. In calculating the percentage of voting rights of such Directors and their concert parties, treasury
shares shall be excluded.
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Under Appendix 2 of the Take-over Code, a Shareholder not acting in concert with the Directors will not be
required to make a take-over offer for the Company under Rule 14 if, as a result of Share Buybacks, the voting
rights of such Shareholder would increase to thirty per cent. (30%) or more, or, if such Shareholder holds
between thirty per cent. (30%) and fifty per cent. (50%) of the Company’s voting rights, the voting rights of such
Shareholder would increase by more than one per cent. (1%) in any period of six (6) months. Such Shareholder
need not abstain from voting in respect of the resolution authorising the Share Buyback Mandate. Shareholders
will be subject to the provisions of Rule 14 if they acquire any Shares after Share Buybacks by the Company. For
the purpose of the Take-over Code, an increase in the percentage of voting rights as a result of Share Buybacks
will be taken into account in determining whether a Shareholder and persons acting in concert with him have
increased their voting rights by more than one per cent. (1%) in any period of six (6) months.
(v) If the Company decides to cease the purchase of Shares before it has purchased such number of Shares
authorised by its Shareholders at the latest annual general meeting, the Company will promptly inform its
Shareholders of such cessation. This will assist Shareholders to determine if they can buy any more Shares
without incurring an obligation under Rule 14.
Based on the shareholdings of the Directors and Substantial Shareholders of the Company as at the Latest
Practicable Date, the Share Buyback Mandate is not expected to result in any Director or Substantial Shareholder
incurring an obligation to make a general offer for the Shares of the Company under Rule 14 or Appendix 2 of
the Take-over Code.
Shareholders who are in doubt as to their obligations, if any, to make a mandatory takeover offer
under the Take-over Code as a result of Share Buybacks by the Company are advised to consult their
professional advisers and/or the Securities Industry Council and/or other relevant authorities at the
earliest opportunity.
Purely for illustrative purposes, on the basis of 93,501,600 Shares in issue as at the Latest Practicable Date, and
assuming that no further Shares are issued on or prior to the AGM, not more than 9,350,160 Shares (representing
ten per cent. (10%) of the Shares in issue as at that date) may be purchased or acquired by the Company pursuant
to the Share Buyback Mandate, if so approved by Shareholders at the AGM.
Assuming that such granted Share Buyback Mandate is validly and fully exercised prior to the next AGM for it
to re-purchase the maximum allowed number of Shares being 9,350,160 Shares (on the basis that there would
have been no change to the number of Shares in issue at the time of such exercise) and that such re-purchased
Shares are not acquired from Directors and the Substantial Shareholders and are deemed cancelled immediately
upon purchase, based on the Register of Directors’ Shareholdings and Register of Substantial Shareholders of
the Company as at the Latest Practicable Date, the shareholdings of the Directors and Substantial Shareholders
would be changed as follows:
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Before the Share Buyback After the Share Buyback
Direct interest Deemed interest Direct interest Deemed interest
No. of
Shares %
No. of
Shares %
No. of
Shares %
No. of
Shares %
Directors
Directors
Jimmy Fong Teck Loon(1) 50,369,800 53.87 630,000 0.67 50,369,800 59.86 630,000 0.75
Brenda Yeo(1) 630,000 0.67 50,369,800 53.87 630,000 0.75 50,369,800 59.86
Siow Chee Kheong 100,000 0.11 – 0.00 100,000 0.12 – 0.00
Substantial Shareholders
Johnson Goh Ann Ann 10,710,000 11.45 – 0.00 10,710,000 12.73 – 0.00
Rowsley Sports Pte. Ltd. 4,861,000 5.20 – 0.00 4,861,000 5.78 – 0.00
Rowsley Ltd(2) – 0.00 4,861,000 5.20 – 0.00 4,861,000 5.78
Garville Pte Ltd(2) – 0.00 4,861,000 5.20 – 0.00 4,861,000 5.78
Lim Eng Hock(2) – 0.00 4,861,000 5.20 – 0.00 4,861,000 5.78
Notes:
(1) Mr Jimmy Fong Teck Loon is deemed to be interested in the 630,000 shares held by his wife, Ms Brenda Yeo and vice
versa by virtue of Section 7 of the Companies Act, Cap. 50.
(2) Rowsley Ltd, Garville Pte Ltd and Lim Eng Hock are deemed to be interested in the 4,861,000 shares held by Rowsley
Sports Pte. Ltd. by virtue of Section 7 of the Companies Act, Cap. 50.
1.10 No Shares Purchased or Acquired in the Previous Twelve Months
The Company has not made any purchase or acquisition of its Shares (whether via On-Market Purchases or Off-Market
Purchases in the 12 months preceding the Latest Practicable Date).
1.11 Taxation
Shareholders who are in doubt as to their respective tax positions or any tax implications, or who may be subject to
tax in a jurisdiction outside Singapore, should consult their own professional advisers.
2. DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTERESTS
The interests of the Directors and Substantial Shareholders of the Company as at the Latest Practicable Date, as recorded
in the Company’s Register of Directors’ Shareholdings and the Register of Substantial Shareholders respectively, are
set out as follows.
addendum
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
110EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
Directors’ Interests
Direct interest Deemed interest
No. of Shares % No. of Shares %
Directors
Jimmy Fong Teck Loon(1) 50,369,800 53.87 630,000 0.67
Brenda Yeo(1) 630,000 0.67 50,369,800 53.87
Siow Chee Kheong 100,000 0.11 – 0.00
Substantial Shareholders’ Interests
Direct interest Deemed interest
Johnson Goh Ann Ann 10,710,000 11.45 – 0.00
Rowsley Sports Pte. Ltd. 4,861,000 5.20 – 0.00
Rowsley Ltd(2) – 0.00 4,861,000 5.20
Garville Pte Ltd(2) – 0.00 4,861,000 5.20
Lim Eng Hock(2) – 0.00 4,861,000 5.20
Notes:
(1) Mr Jimmy Fong Teck Loon is deemed to be interested in the 630,000 shares held by his wife, Ms Brenda Yeo and vice versa
by virtue of Section 7 of the Companies Act, Cap. 50.
(2) Rowsley Ltd, Garville Pte Ltd and Lim Eng Hock are deemed to be interested in the 4,861,000 shares held by Rowsley Sports
Pte. Ltd. by virtue of Section 7 of the Companies Act, Cap. 50.
3. ACTIONS TO BE TAKEN BY SHAREHOLDERS
Shareholders who are unable to attend the AGM and wish to appoint a proxy to attend and vote on their behalf should
sign and return the Proxy Form attached to the Notice of AGM in accordance with the instructions printed thereon
as soon as possible and in any event so as to arrive at the registered office of the Company at 37 Jalan Pemimpin
#07-04 Clarus Centre, Singapore 577177, not later than forty-eight (48) hours before the time fixed for the AGM. The
appointment of a proxy by a Shareholder does not preclude him/her from attending and voting in person at the AGM
if he/she subsequently wishes to do so, in place of his/her proxy.
CPF investors may wish to check with their CPF Approved Nominees on the procedure and deadline for the submission
of their written instructions to their CPF Approved Nominees to vote on their behalf.
A Depositor shall not be regarded as a Shareholder entitled to attend the AGM and to speak or vote thereat unless
he/she is shown to have Shares entered against his/her name in the Depository Register, as certified by the CDP, as at
forty-eight (48) hours before the AGM.
addendum
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
111
4. DIRECTORS’ RECOMMENDATION
The Directors are of the opinion that the renewal of the Share Buyback Mandate is in the best interests of the Company.
Accordingly, they recommend that Shareholders vote in favour of the Resolution 14 relating to the renewal of the Share
Buyback Mandate at the forthcoming AGM.
5. DIRECTORS’ RESPONSIBILITY STATEMENT
The Directors collectively and individually accept full responsibility for the accuracy of the information given in this
Addendum and confirm after making all reasonable enquiries, that to the best of their knowledge and belief, this
Addendum constitutes full and true disclosure of all material facts about the Proposed Renewal of the Share Buyback
Mandate, the issuer and its subsidiaries, and the Directors are not aware of any facts the omission of which would make
any statement in this Addendum misleading. Where information in the Addendum has been extracted from published or
otherwise publicly available sources or obtained from a named source, the sole responsibility of the Directors has been
to ensure that such information has been accurately and correctly extracted from those sources and/or reproduced in
the Addendum in its proper form and context.
6. DOCUMENTS FOR INSPECTION
Copies of the Company’s annual report for FY 2011 and its memorandum and articles of association are available for
inspection at the registered office of the Company at 37 Jalan Pemimpin #07-04 Clarus Centre, Singapore 577177 during
normal business hours from the date hereof up to and including the date of the forthcoming AGM.
Yours faithfully
For and on behalf of the Board of Directors
Epicentre Holdings Limited
Jimmy Fong Teck Loon
Executive Chairman and Chief Executive Officer
notice of annual general meeting
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
112EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
NOTICE IS HEREBY GIVEN that the Annual General Meeting of EPICENTRE HOLDINGS LIMITED (the “Company”) will be held
at 1 Orchid Club Road, Orchid Country Club, Level 1, Golf Clubhouse, Octagon, Singapore 769162 on Friday, 28 October 2011
at 10.00 a.m. for the following purposes:
AS ORDINARY BUSINESS
1. To receive and adopt the Directors’ Report and the Audited Accounts of the Company for the financial year ended 30
June 2011 together with the Auditors’ Report thereon.
(Resolution 1)
2. To declare a tax exempt one-tier final dividend of 2 Singapore cents per share for the financial year ended 30 June 2011
(2010: 2 Singapore cents per share).
(Resolution 2)
3. To declare a tax exempt one-tier special one-off dividend of 2 Singapore cents per share for the financial year ended
30 June 2011 (2010: Nil).
(Resolution 3)
4. To re-elect the following Directors of the Company retiring pursuant to Article 92 and Article 93 of the Articles of
Association of the Company:
Mr Azman Hisham Bin Jaafar (Retiring under Article 92) (Resolution 4)
Ms Brenda Yeo (Retiring under Article 93) (Resolution 5)
[See Explanatory Note (i)]
5. To approve the payment of Directors’ Fees of S$261,668 for the financial year ended 30 June 2011 (2010: S$100,000).
(Resolution 6)
6. To re-appoint Messrs BDO LLP as the Auditors of the Company and to authorise the Directors of the Company to fix
their remuneration.
(Resolution 7)
7. To transact any other ordinary business which may properly be transacted at the Annual General Meeting.
notice of annual general meeting
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
113
AS SPECIAL BUSINESS
To consider and if thought fit, to pass the following resolutions as Ordinary Resolutions, with or without any modifications:
8. Authority to issue shares in the capital of the Company pursuant to Section 161 of the Companies Act, Cap. 50
and Rule 806 of the Listing Manual Section B: Rules of Catalist of the Singapore Exchange Securities Trading
Limited
That pursuant to Section 161 of the Companies Act, Cap. 50 and Rule 806 of the Listing Manual Section B: Rules of Catalist
of the Singapore Exchange Securities Trading Limited (the “SGX-ST”), the Directors of the Company be authorised and
empowered to:
(a) (i) issue shares in the Company (“shares”) whether by way of rights, bonus or otherwise; and/or
(ii) make or grant offers, agreements or options (collectively, “Instruments”) that might or would require
shares to be issued, including but not limited to the creation and issue of (as well as adjustments to)
options, warrants, debentures or other instruments convertible into shares,
at any time and upon such terms and conditions and for such purposes and to such persons as the Directors
of the Company may in their absolute discretion deem fit; and
(b) (notwithstanding the authority conferred by this Resolution may have ceased to be in force) issue shares in
pursuance of any Instrument made or granted by the Directors of the Company while this Resolution was in
force,
(the “Share Issue Mandate”)
provided that:
(1) the aggregate number of shares (including shares to be issued in pursuance of the Instruments, made or granted
pursuant to this Resolution) and Instruments to be issued pursuant to this Resolution shall not exceed 100%
of the total number of issued shares (excluding treasury shares) in the capital of the Company (as calculated
in accordance with sub-paragraph (2) below), of which the aggregate number of shares and Instruments to be
issued other than on a pro rata basis to existing shareholders of the Company shall not exceed 50% of the total
number of issued shares (excluding treasury shares) in the capital of the Company (as calculated in accordance
with sub-paragraph (2) below);
(2) (subject to such calculation as may be prescribed by the SGX-ST) for the purpose of determining the aggregate
number of shares and Instruments that may be issued under sub-paragraph (1) above, the percentage of issued
shares and Instruments shall be based on the number of issued shares (excluding treasury shares) in the capital
of the Company at the time of the passing of this Resolution, after adjusting for:
(a) new shares arising from the conversion or exercise of the Instruments or any convertible securities;
notice of annual general meeting
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
114EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
(b) new shares arising from exercising share options or vesting of share awards outstanding and subsisting
at the time of the passing of this Resolution; and
(c) any subsequent bonus issue, consolidation or subdivision of shares;
(3) in exercising the Share Issue Mandate conferred by this Resolution, the Company shall comply with the provisions
of the Listing Manual Section B: Rules of Catalist of the SGX-ST for the time being in force (unless such compliance
has been waived by the SGX-ST) and the Articles of Association of the Company; and
(4) unless revoked or varied by the Company in a general meeting, the Share Issue Mandate shall continue in force
(i) until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual
General Meeting of the Company is required by law to be held, whichever is earlier or (ii) in the case of shares
to be issued in pursuance of the Instruments, made or granted pursuant to this Resolution, until the issuance
of such shares in accordance with the terms of the Instruments.
(Resolution 8)
[See Explanatory Note (ii)]
9. Authority to issue shares under the Epicentre Holdings Limited Performance Share Plan
That pursuant to Section 161 of the Companies Act, Cap. 50, the Directors of the Company be authorised and empowered
to offer and grant awards under the Epicentre Holdings Limited Performance Share Plan (the “Plan”) and to issue from
time to time such number of shares in the capital of the Company as may be required to be issued pursuant to the
vesting of awards under the Plan, whether granted during the subsistence of this authority or otherwise, provided always
that the aggregate number of additional ordinary shares to be issued pursuant to the Plan shall not exceed fifteen
per centum (15%) of the total number of issued shares (excluding treasury shares) in the capital of the Company from
time to time and that such authority shall, unless revoked or varied by the Company in a general meeting, continue in
force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual
General Meeting of the Company is required by law to be held, whichever is earlier.
(Resolution 9)
[See Explanatory Note (iii)]
10. Authority to issue shares under the Epicentre Holdings Limited Scrip Dividend Scheme
That pursuant to Section 161 of the Companies Act, Cap. 50 and Rule 806 of the Listing Manual Section B: Rules of Catalist
of the Singapore Exchange Securities Trading Limited, the Directors of the Company be authorised and empowered
to issue such number of shares in the Company as may be required to be issued pursuant to the Epicentre Holdings
Limited Scrip Dividend Scheme (the “Scheme”) from time to time in accordance to the “Terms and Conditions of the
Scheme as set out on pages 81 to 86 of the Circular dated 7 June 2010” and that such authority shall, unless revoked
or varied by the Company in a general meeting, continue in force until the conclusion of the next Annual General
Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law
to be held, whichever is earlier.
(Resolution 10)
[See Explanatory Note (iv)]
notice of annual general meeting
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
115
11. The proposed Participation by an Associate of the Controlling Shareholder under the Epicentre Holdings
Limited Performance Share Plan
THAT Ms Brenda Yeo, an Associate of the Controlling Shareholder, be authorised to participate in the Epicentre Holdings
Limited Performance Share Plan provided always that the Performance Shares to be issued to the Associate of the
Controlling Shareholder pursuant to the Plan, shall not exceed 10% of the aggregate number of Performance Shares
issued under the Plan in conformity with the limits prescribed therein.
(Resolution 11)
12. The proposed Grant of Award to the Controlling Shareholder under the Epicentre Holdings Limited
Performance Share Plan
THAT the proposed grant of Award to Mr Jimmy Fong Teck Loon, the Controlling Shareholder, in accordance with the
terms under the Epicentre Holdings Limited Performance Share Plan and the following terms, is hereby approved:
Proposed date of grant of Award : 1 November 2011
Number of Shares in the proposed grant of Award : 1,400,000 Shares
Date of issue and allotment of Shares : 31 October 2013
(Resolution 12)
13. The proposed Grant of Award to an Associate of the Controlling Shareholder under the Epicentre Holdings
Limited Performance Share Plan
THAT subject to and contingent upon the passing of Resolution 11 above, the proposed grant of Award to Ms Brenda
Yeo, an Associate of the Controlling Shareholder, in accordance with the terms under the Epicentre Holdings Limited
Performance Share Plan and the following terms, is hereby approved:
Proposed date of grant of Award : 1 November 2011
Number of Shares in the proposed grant of Award : 1,200,000 Shares
Date of issue and allotment of Shares : 31 October 2013
(Resolution 13)
14. Renewal of Share Buyback Mandate
That:
(a) for the purposes of the Companies Act Cap. 50 (the “Act”), the exercise by the Directors of the Company of all
the powers of the Company to purchase or otherwise acquire the ordinary shares in the capital of the Company
not exceeding in aggregate the Prescribed Limit (as hereafter defined), at such price(s) as may be determined
by the Directors of the Company from time to time up to the Maximum Price (as hereafter defined), whether
by way of:
(i) market purchases (“On-Market Purchase”), transacted on the Catalist through the Singapore Exchange
Securities Trading Limited’s Central Limit Order Book trading system or, as the case may be, any other
securities exchange on which the Shares may for the time being be listed and quoted, through one or
more duly licensed stockbrokers appointed by the Company for the purpose; and/or
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EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
116EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
(ii) off-market purchases (each an “Off-Market Purchase”) effected otherwise than on the Catalist in
accordance with any equal access schemes (subject to Section 76C of the Act) as may be determined
or formulated by the Directors of the Company as they consider fit, which schemes shall satisfy all the
conditions prescribed by the Act, and otherwise in accordance with all other listing rules and regulations
of the Singapore Exchange Securities Trading Limited as may for the time being be applicable, be and
is hereby authorised and approved generally and unconditionally (the “Share Buyback Mandate”);
(b) unless varied or revoked by an ordinary resolution of shareholders of the Company in general meeting, the
authority conferred on the Directors of the Company pursuant to the Share Buyback Mandate may be exercised
by the Directors at any time and from time to time during the period commencing from the passing of this
Resolution and expiring on the earlier of:
(i) the date on which the next Annual General Meeting of the Company is held or required by law to be
held; or
(ii) the date on which the authority contained in the Share Buyback Mandate is varied or revoked by an
ordinary resolution of shareholders of the Company in general meeting;
(c) in this Resolution:
“Prescribed Limit” means ten per centum (10%) of the total number of ordinary shares of the Company as at
the date of the last Annual General Meeting or as at the date of passing of this Resolution (whichever is the
higher) unless the Company has effected a reduction of the share capital of the Company in accordance with
the applicable provisions of the Act, at any time during the Relevant Period, in which event the total number of
ordinary shares of the Company shall be taken to be the amount of the total number of ordinary shares of the
Company as altered (excluding any treasury shares that may be held by the Company from time to time);
“Relevant Period” means the period commencing from the date on which the last Annual General Meeting
was held and required by law to held and expiring on the date the next Annual General Meeting is held or is
required by law to be held, whichever is the earlier, after the date of this Resolution; and
“Maximum Price” in relation to a Share to be purchased, means an amount (excluding brokerage, stamp duties,
applicable goods and services tax and other related expenses) not exceeding:
(i) in the case of an On-Market Purchase: 105% of the Average Closing Price; and
(ii) in the case of an Off-Market Purchase: 120% of the Average Closing Price:
notice of annual general meeting
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
117
where:
“Average Closing Price” means, in the case of a Market Purchase, the average of the closing market prices of
the Shares over the last five (5) market days, on which transactions in the Shares on the Catalist were recorded,
before the day on which an On-Market purchase was made by the Company or, in the case of an Off-Market
Purchase, the date of the announcement of the offer pursuant to an Off-Market Purchase, and deemed to be
adjusted in accordance with the Catalist Rules for any corporate action which occurs after the relevant period
of five (5) market days; and
(d) the Directors of the Company and each of them be and are hereby authorised and empowered to complete
and do all such acts and things (including executing such documents as may be required) as they may consider
desirable, expedient or necessary in the interest of the Company in connection with or for the purposes of giving
full effect to the Share Buyback Mandate.
(Resolution 14)
[See Explanatory Note (v)]
By Order of the Board
Chew Kok Liang
Nathaniel C. V.
Company Secretaries
Singapore
11 October 2011
Explanatory Notes:
(i) Mr Azman Hisham Bin Jaffar will, upon re-election as a Director of the Company, remain as Chairman of the Nominating Committee,
a member of the Audit Committee and Remuneration Committee respectively and will be considered independent.
(ii) the Ordinary Resolution 8 in item 8 above, if passed, will empower the Directors of the Company from the date of this Annual General
Meeting until the date of the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of
the Company is required by law to be held or such authority is varied or revoked by the Company in a general meeting, whichever is
the earlier, to issue shares, make or grant instruments convertible into shares and to issue shares pursuant to such instruments, up to
a number not exceeding, in total, 100% of the total number of issued shares (excluding treasury shares) in the capital of the Company,
of which up to 50% may be issued other than on a pro rata basis to existing members of the Company.
(iii) The Ordinary Resolution 9 in item 9 above, if passed, will empower the Directors of the Company, from the date of this Meeting until
the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is required
by law to be held or such authority is varied or revoked by the Company in a general meeting, whichever is the earlier, to issue shares
in the Company pursuant to the vesting of awards under the Epicentre Holdings Limited’s Performance Share Plan up to a number
not exceeding in total (for the entire duration of the Plan) fifteen per centum (15%) of the total number of issued shares (excluding
treasury shares) in the capital of the Company from time to time.
notice of annual general meeting
EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
118EPICENTRE HOLDINGS LIMITED ANNUAL REPORT 2011
(iv) The Ordinary Resolution 10 in item 10 above, if passed, will empower the Directors of the Company, from the date of this Meeting
until the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is
required by law to be held or when varied or revoke by the Company in a general meeting, whichever is the earlier, to issue shares in
the Company from time to time pursuant to the Epicentre Holdings Limited’s Scrip Dividend Scheme.
(v) The Ordinary Resolution 14 in item 14 above, if passed, will empower the Directors of the Company from the date of the above Meeting
until the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is
required by law to be held, whichever is the earlier, to repurchase ordinary shares of the Company by way of on-market purchases or
Off-Market Purchase of up to ten per centum (10%) of the total number of issued shares (excluding treasury shares) in the capital of
the Company at the Maximum Price as defined in Addendum.
Notes:
1. A Member entitled to attend and vote at the Annual General Meeting (the “Meeting”) is entitled to appoint not more than two proxies
to attend and vote in his/her stead. A proxy need not be a Member of the Company.
2. If the appointer is a corporation, the instrument appointing a proxy must be executed either under its seal or under the hand of an
officer or attorney duly authorised.
3. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 37 Jalan Pemimpin #07-04 Clarus
Centre, Singapore 577177 not less than forty-eight (48) hours before the time appointed for holding the Meeting.
4. This notice has been prepared by the Company and its contents have been reviewed by the Company’s sponsor (“Sponsor”), Asian
Corporate Advisors Pte. Ltd., for compliance with the relevant rules of the Singapore Exchange Securities Trading Limited (“Exchange”).
The Company’s Sponsor has not independently verified the contents of this notice including the correctness of any of the figures
used, statements or opinions made.
This notice has not been examined or approved by the Exchange and the Exchange assumes no responsibility for the contents of this
notice including the correctness of any of the statements or opinions made or reports contained in this notice.
The contact person for the Sponsor is Mr Liau H.K.
Telephone number: 6221 0271
notice of book closure date
ANNUAL REPORT 2011 EPICENTRE HOLDINGS LIMITED
119
NOTICE IS HEREBY GIVEN that the Share Transfer Books and Register of Members of the Company will be closed on
9 November 2011 for the purpose of determining the members’ entitlements to the tax exempt one-tier final dividend and
tax exempt one-tier special one-off dividend to be proposed at the Annual General Meeting of the Company to be held on
28 October 2011.
Duly completed registrable transfers in respect of the shares of the Company received by the Company’s Share Transfer Agent
in Singapore, Boardroom Corporate & Advisory Services Pte. Ltd. up to 5.00 p.m. on 8 November 2011 will be registered to
determine members’ entitlements to such dividends. Member whose Securities Accounts with The Central Depository (Pte) Ltd
are credited with shares of the Company as at 5.00 p.m. on 8 November 2011 will be entitled to such proposed dividends.
Payment of the said dividends, if approved by the members at the Annual General Meeting, will be paid on 23 November
2011.
By Order of the Board
Chew Kok Liang
Nathaniel C. V.
Company Secretaries
Singapore
11 October 2011
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EPICENTRE HOLDINGS LIMITED(Company Registration No. 200202930G)
(Incorporated in the Republic of Singapore)
PROXY FORM(Please see notes overleaf before completing this Form)
IMPORTANT:
1. For investors who have used their CPF monies to buy Epicentre Holdings Limited’s shares, this Report is forwarded to them at the request of the CPF Approved Nominees and is sent solely FOR INFORMATION ONLY.
2. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them.
3. CPF investors who wish to attend the Meeting as an observer must submit their requests through their CPF Approved Nominees within the time frame specified. If they also wish to vote, they must submit their voting instructions to the CPF Approved Nominees within the time frame specified to enable them to vote on their behalf.
I/We,
of
being a member/members of EPICENTRE HOLDINGS LIMITED (the “Company”), hereby appoint:
Name NRIC/Passport No. Proportion of Shareholdings
No. of Shares %
Address
and/or (delete as appropriate)
Name NRIC/Passport No. Proportion of Shareholdings
No. of Shares %
Address
or failing the person, or either or both of the persons, referred to above, the Chairman of the Meeting as my/our proxy/proxies to vote for me/us on my/our behalf at the Annual General Meeting (the “Meeting”) of the Company to be held at 1 Orchid Club Road, Orchid Country Club, Level 1, Golf Clubhouse, Octagon, Singapore 769162 on Friday, 28 October 2011 at 10.00 a.m. and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the Meeting as indicated hereunder. If no specific direction as to voting is given or in the event of any other matter arising at the Meeting and at any adjournment thereof, the proxy/proxies will vote or abstain from voting at his/her discretion. The authority herein includes the right to demand or to join in demanding a poll and to vote on a poll.
(Please indicate your vote “For” or “Against” with a tick [√] within the box provided.)
No. Resolutions relating to: For Against
1. Directors’ Report and Audited Accounts for the financial year ended 30 June 2011
2. Payment of proposed tax exempt one-tier final dividend of 2 Singapore cents per ordinary
share for the financial year ended 30 June 2011
3. Payment of proposed tax exempt one-tier special one-off dividend of 2 Singapore cents per
ordinary share for the financial year ended 30 June 2011
4. Re-election of Mr Azman Hisham Bin Jaafar as a Director
5. Re-election of Ms Brenda Yeo as a Director
6. Approval of Directors’ Fees amounting to S$261,668
7. Re-appointment of Messrs BDO LLP as Auditors
8. Authority to issue shares
9. Authority to issue award of shares under the Epicentre Holdings Limited Performance
Share Plan
10. Authority to issue shares under the Epicentre Holdings Limited Scrip Dividend Scheme
11. The proposed Participation by an Associate of the Controlling Shareholder under the
Epicentre Holdings Limited Performance Share Plan
12. The proposed Grant of Award to the Controlling Shareholder under the Epicentre
Holdings Limited Performance Share Plan
13. The proposed Grant of Award to an Associate of the Controlling Shareholder under the
Epicentre Holdings Limited Performance Share Plan
14. Renewal of Share Buyback Mandate
Dated this day of 2011
Total number of Shares in: No. of Shares
(a) CDP Register
(b) Register of Members
Signature of Shareholder(s)
or, Common Seal of Corporate Shareholder
IMPORTANT: PLEASE READ NOTES OVERLEAF
Notes:
1. Please insert the total number of Shares held by you. If you have Shares entered against your name in the Depository Register
(as defined in Section 130A of the Companies Act, Chapter 50 of Singapore), you should insert that number of Shares. If you
have Shares registered in your name in the Register of Members, you should insert that number of Shares. If you have Shares
entered against your name in the Depository Register and Shares registered in your name in the Register of Members, you
should insert the aggregate number of Shares entered against your name in the Depository Register and registered in your
name in the Register of Members. If no number is inserted, the instrument appointing a proxy or proxies shall be deemed to
relate to all the Shares held by you.
2. A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies
to attend and vote in his/her stead. A proxy need not be a member of the Company.
3. Where a member appoints more than one proxy, he/she shall specify the proportion of his/her shareholding to be represented
by each proxy. If no such proportion or number is specified the appointments shall be invalid unless he/she specifies the
proportion of his/her shareholding (expressed as a percentage of the whole) to be represented by each proxy.
4. Completion and return of this instrument appointing a proxy shall not preclude a member from attending and voting at the
Meeting. Any appointment of a proxy or proxies shall be deemed to be revoked if a member attends the meeting in person,
and in such event, the Company reserves the right to refuse to admit any person or persons appointed under the instrument
of proxy to the Meeting.
5. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at 37 Jalan Pemimpin
#07-04 Clarus Centre, Singapore 577177 not less than forty-eight (48) hours before the time appointed for the Meeting.
6. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his/her attorney duly authorised
in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under
its seal or under the hand of an officer or attorney duly authorised. Where the instrument appointing a proxy or proxies is
executed by an attorney on behalf of the appointor, the letter or power of attorney or a duly certified copy thereof must be
lodged with the instrument.
7. A corporation which is a member may authorise by resolution of its directors or other governing body such person as it thinks fit
to act as its representative at the Meeting, in accordance with Section 179 of the Companies Act, Chapter 50 of Singapore.
General:
The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or
illegible, or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the
instrument appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company may
reject any instrument appointing a proxy or proxies lodged if the member, being the appointor, is not shown to have Shares entered
against his/her name in the Depository Register as at forty-eight (48) hours before the time appointed for holding the Meeting, as
certified by The Central Depository (Pte) Limited to the Company.
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stakeholders.
Total Commitment to Customers, unmatched
service excellence and innovative services
for their one stop Digital Lifestyle needs.
Innovation Learning Ownership
Vision Excellence Integrity Teamwork
This document has been prepared by the Company and its contents have been reviewed by the Company’s sponsor (“Sponsor”), Asian Corporate Advisors Pte. Ltd., for compliance with the relevant rules of the Singapore Exchange Securities Trading Limited (“Exchange”). The Company’s Sponsor has not independently verifi ed the contents of this document including the correctness of any of the fi gures used, statements or opinions made.
This document has not been examined or approved by the Exchange and the Exchange assumes no responsibility for the contents of this document including the correctness of any of the statements or opinions made or reports contained in this document.
The contact person for the Sponsor is Mr Liau H.K.Telephone number: 6221 0271
Designed and produced by
(65) 6578 6522
Epicentre Holdings Limited
37 Jalan Pemimpin
#07-04 Clarus Centre
Singapore 577177
Telephone: +65 6601 9100
Facsimile: +65 6601 9133
Website: www.epicentreasia.com
EpiCentre Holdings Limited37 Jalan Permimpin, Clarus Centre
Block A, #08-02B, Singapore 577177
Tel: +65 6100 9100 Fax: +65 6101 9111
Annual Report 2011
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