ANNUAL REPORT - 早报 · 2013. 5. 13. · #11-00 PWC Building Singapore 048424 Auditors Chio Lim & Associates Certified Public Accountants 18 Cross Street ... Vietnam the new plant

30 Gul Crescent, JurongSingapore 629535Telephone (65) 6861 5503Facsimile (65) 6861 9162Email: [email protected]: www.aplube.com

Alpha Pacific Petroleum (S) Pte Ltd

18 Pioneer Sector 1, JurongSingapore 628428Telephone (65) 6862 2765Facsimile (65) 6861 0259Email: [email protected]: www.aplube.com

A.I.M Chemical Industries Pte Ltd

19 Tractor Road, JurongSingapore 627977Telephone (65) 6265 4700Facsimile (65) 6266 5082Email: [email protected]: www.aimchem.com.sg

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02A N N U A L R E P O R T

Chairman’s Message 3

Operations Review 7

Board of Directors 9

Corporate Governance Statement 11

Group Financial Highlights 16

Financial Contents 17

Information on Shareholdings 53

Notice of Annual General Meeting 55

Proxy Form

Corporate Information inside back cover

contents

Company SecretariesMs Tan Siok Kheng, ACIS, LLB (Hons) (London)Ms Lau Woon Chan, BA (Nanyang)

Registered Office30 Gul CrescentJurongSingapore 629535Telephone (65) 6861 5503Facsimile (65) 6861 9162Email: [email protected]: www.aplube.com

RegistrarBarbinder & Co Pte Ltd8 Cross Street#11-00 PWC BuildingSingapore 048424

AuditorsChio Lim & AssociatesCertified Public Accountants18 Cross Street#09-01China Square CentralSingapore 048423

Principal BankersThe Development Bank of Singapore Ltd6 Shenton WayDBS Building Tower OneSingapore 068809

The Hongkong and Shanghai Banking Corporation Limited21 Collyer Quay #08-01HSBC BuildingSingapore 049320

Standard Chartered Bank6 Battery Road#07-00Singapore 049909

Bank of ChinaSingapore Branch4 Battery RoadBank of China BuildingSingapore 049908

corporate information

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chairman’s message


Despite the depressed world economic environment and thechallenging market conditions, I am pleased to report that AP Oilhas managed well and achieved a good set of results for thefinancial year 2002. Group turnover soared 121% to S$76.5 million.The profit before tax of the Group rose by 30% to S$3.29 millionand net profit after tax increased 26% to S$2.39 million.

Net tangible asset (NTA) per share rose from 11.67 cents in FY2001to 14.16 cents in FY2002 while the earnings per share (EPS) wasup from 2.37 cents to 2.73 cents.

The sterling results reflect the success of the Group’s business policyand strategy in penetrating new markets, expanding market sharein existing markets as well as our product and quality enhancementefforts to position ourselves well to take advantage of the risingopportunities in the Asia Pacific region. In the past year, we havesecured some prestigious major customers especially state-ownedcompanies and made significant progress in driving growth in ournew marine business sector.

Positive performance was recorded in all our key markets andbusiness sectors. Our key markets - IndoChina and Southeast Asiamarkets registered revenue growth of 273.5% and 100.6%respectively. Our key business segments – manufacturing, tradingand marine divisions all performed well. Our manufacturingsegment rose by 4.7% and trading segment grew by 211.5%. Themarine segment registered the highest growth of 3244.2% as itrecognised its maiden full-year contributions to the Group’srevenue.

The higher sales generated helped to boost our bottomline. Weenjoyed profit growth in all our key business segments and keymarkets in FY2002.

“AP Oil has managed well and achieved a good set of results for the financial year 2002. Group turnover soared 121% toS$76.5 million. The profit before tax of the Group rose by 30% to S$3.29 million and net profit after tax increased 26% toS$2.39 million.”

“The Company is expected to turn in a satisfactory performance in FY2003.”

A N N U A L R E P O R T 2 0 0 24


ACHIEVEMENTS OF FY2002

In addition to delivering superior results, the Group has also madepositive strides that strengthened our plans for long-term growthand excellence.

Expansion in Manufacturing Operations

To meet the increasing demand for our products and enhanceour competitive edge in our core businesses, we have upgradedthe production facilities and equipment at the Singapore plants.We have added a new grease-packing machine and two fillinglines for lubricating oils.

A water purification system for DI water and a new blending vesselwere also introduced for specialty chemical products.

In Vietnam, the land reclamation and levelling works have beencompleted for the new plant. The licence for the proposed 15,000mt jetty has also been approved by the authorities.

New Product Development

During the last financial year, the Group’s R&D team has developed12 new lubricant products. These new products have beensuccessfully launched and marketed with positive reception amongtheir target markets and made contribution to the bottomline.

New Licences

We have obtained a total of 7 licences from reputable carmanufacturers such as Daimler Chrysler and Volkswagen, as wellas international renowned marine engine builders such as MANand MACK, and American Petroleum Institute (API).

ISO Certifications Upgrading

To underscore our commitment to the highest quality standards,AP Oil has also successfully upgraded its QA status from ISO9001(1994) to ISO9001 (2000), while A.I.M.’s upgrading from ISO9002(1994) to ISO9001 (2000) is in progress.

New Markets and Major Customers

FY2002 was a fruitful year for our achievements in new markets.Both new markets in China and the Philippines made positive salescontributions of 26% and 16% to the Group’s revenue respectively.We also managed to secure new major customers in these newmarkets as well as in existing markets, particularly the national oilcompanies in the region. The volume of orders from theseprestigious national companies is usually substantial.

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Market Expansion Through Branding

We have appointed new agents for AP brand in the Philippines,Hong Kong and Fiji, as well as established new distributionnetworks for SIN-O in the Philippines and for AP in Northern China.

Brand names are important assets of our business. We havesuccessfully promoted our brands – AP and SIN-O to be oneof the most popular names in countries such as Myanmar,Bangladesh, etc.

GROWTH STRATEGIES AND FUTURE PLANS

Strengthen R&D & QA for New Product Development

With four laboratories and a team of highly-qualified researchengineers and chemists, we will continue to build our strengths inR&D and QA to drive growth in our product development.

We have planned to work with A-star to further strengthen ourR&D capabilities. Our R&D team will constantly upgrade ourexisting products and develop new ones to meet changing marketdemands. A new research laboratory will be set up in the newplant in Vietnam to conduct R&D programmes. Our R&D strengthswill continue to make contributions to our market growth andbottomline.

Enhancing Brand Presence

As part of the Group’s plans to promote our long-term presencein new markets, our emphasis will be placed on building our brandnames - AP and SIN-O – both regionally and internationally. Thiswill include enhancing product image through the re-designingand re-packaging for small packs.

Growth Through Joint Ventures, Strategic Partnerships andAcquisitions

The Group is exploring opportunities further in China by eithersetting up JV plants or strategic partnerships with suitable partners.The target is to establish three footholds along coastal provinces.The Group is also planning to implement a franchising scheme toseek new markets in countries where we currently do not have apresence, due to barriers and restrictions to the import of finishedlubricant products. Where opportunity arises, the Group will alsoconsider mergers and acquisitions, both in Singapore and overseas,as a means for growth.

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Future Expansion

To meet the growing demands for specialty chemicals, productionlines at A.I.M. will be upgraded. Apart from this, it is our policythat future expansion of production facilities shall be overseas. InVietnam the new plant with bulk storage terminal and 15,000-mtberthing jetty is scheduled for operation by Q4 of 2003.

BUSINESS OUTLOOK AND PROSPECTS FOR FY2003

The overall business climate remains uncertain, especially in lightof the current Middle East war. However, the outlook for thepetrochemical industry seems promising. According to the EDB,Singapore aims to build and develop itself as a world-class hubfor petrochemicals, with a target output of S$75 billion by 2010.

We expect that customers in our newly established markets willcontinue to contribute to our revenue. Our sales and order bookin the first quarter of FY2003 have met management’sexpectations.

Barring unforeseen circumstances and unexpected developments,the Company is expected to turn in a satisfactory performance inFY2003.

DIVIDENDS

The Board of Directors is pleased to recommend a final dividendof 0.156 cent per ordinary share net of tax and a special dividendof 0.741 cent per ordinary share net of tax. Taking intoconsideration our interim dividend, the total dividend for FY2002is 27% before tax. This is in line with our philosophy of deliveringpositive returns to our shareholders and to reward them for theirenduring support.

In fact, AP Oil has been cited by Business Times (15 March 2003)as among the top 10 listed companies in Singapore which havedelivered one of the highest dividends to its shareholders.

IN APPRECIATION

On behalf of the Board of Directors, I wish to express my deepestappreciation to all shareholders and staff members for theirsupport and dedication. We look forward to your continuedsupport and cooperation in 2003.

Dr Ho Leng WoonChairman and Managing Director

A N N U A L R E P O R T 2 0 0 2 7

operations review

operations review

“The Group registered healthy performance in all its business segments for FY2002. “

PERFORMANCE BY BUSINESS SEGMENTS

The Group registered healthy performance in all its businesssegments for FY2002.

Manufacturing

The revenue of manufacturing sector increased by 4.7% to S$18.69million and the pre-tax profit rose by 13.3% to S$1.78 million inFY2002. This business sector also contributed to the bulk of theprofit after tax of the Group.

We have expanded and upgraded our production facilities andequipment in Singapore. At the AP plant, a new grease packingmachine for 3-16kg packs was introduced, a 6-nozzle automaticfilling line for 0.5 to 5-litre pack and two semi-auto filling lines for18 to 25-litre cans were also installed.

As for our specialty chemicals subsidiary, A.I.M., we have added awater purification system for DI water of 16 tonnes per day usingReverse Osmosis (RO) method as well as a new blending vessel(10-tonne capacity) for petrochemical products.

In Vietnam, our 80%-owned JV plant is under construction. Thenew plant with a bulk storage terminal and a jetty for berthing15,000-mt vessels is scheduled to be operational by end FY2003.

Trading

Trading activities registered a surge of 211.5% in sales and pre-tax profit rose sharply by 113.2% to reach S$0.81 million in FY2002.

The strong improvement in profits reflected the enhanced marginsand higher trading volume that we achieved in the past year fromnew major customers secured – especially the prestigious nationaloil companies and state-owned enterprises. In FY2002, there werea total of five national oil companies on our major customer list.

Marine

Our marine sector recorded maiden full-year sales of S$18 million– up 3244.2% compared to less than $0.5m in FY2001. The salesaccounted for 23.4% of the total revenue of the Group. Thisbusiness sector also achieved a pre-tax profit of S$0.23 million.

A N N U A L R E P O R T 2 0 0 28

operations review

Franchising & Outsourcing

Our franchising and outsourcing activities also showedencouraging results. The turnover grew by 5.7% to reach S$5.4million while pre-tax profit also rose by 70% to about S$0.2 million.

PERFORMANCE BY GEOGRAPHICAL SEGMENTS

Our lubricant products are largely marketed under the brandnames of AP and SINO (literally signifying Singapore Oils). Morethan 90% of AP Oil’s products are now exported to some 20countries. However, the majority of specialty chemicals wemanufacture are supplied locally to multinationals based inSingapore. The surge in the Group’s turnover in FY2002 wasattributed to significantly stronger sales from all our key markets.Contributions from two new markets, i.e., China and thePhilippines were most outstanding. China accounted for 26% ofthe Group’s revenue, while the Philippines contributed 16%.

In terms of sales by region, we saw robust growth in SoutheastAsian markets as well as in IndoChina and East Asia. This is partlydue to the increased demand for lubricant products in the regionand our strong marketing efforts in securing new major customers,in new markets as well as key accounts in existing markets.

Sales to Southeast Asia was robust – rising by 100.6% to S$30.3million, which represents about 40% of the total revenue of theGroup.

Contributions from the IndoChina and East Asia region also roseby 273.5% to S$39.2 million, representing about 51% of the totalrevenue.

Geographically, Southeast Asia remained the single largest profitcontributor, which accounted for about 69% of the pre-tax profit.The Group recorded a significant rise of 68.4% in pre-tax profitfrom the IndoChina and East Asian region – which amounted toS$0.64 million. Pre-tax profits from the Group’s other regionstotalled S$0.38 million, an increase of 52% from the previous year.

Others

Indonesia

China

Philippines

VietnamBangladesh

Sales Contributions From Key Markets

Others

Indochine& E. Asia

S.E. Asia

PBT Contributions by Region

A N N U A L R E P O R T 2 0 0 2 9

board of directors

board of directors

Ms Lau Woon ChanDirector (Finance)Member, Remuneration Committee

Ms Lau founded the Company (formerlyknown as Huan Chew Oil Trading (S)Pte Ltd) in 1975. As the Finance Director,she is responsible for all financialmanagement and accounting matters ofthe Group. Ms Lau also assists theManaging Director to explore andevaluate new business opportunities andthe setting of Group’s policy and strategy,she is also looking after the managementof the subsidiary A.I.M. Prior to foundingthe Company, she was a bank officer atBanque IndoSuez Singapore Branch.Ms Lau graduated from NanyangUniversity with a Bachelor of Arts degree.

Dr Ho Leng WoonChairman & Managing DirectorMember, Audit Committee

As Chairman and Managing Director,Dr Ho is responsible for the Group’soverall strategic planning, business andcorporate directions. Dr Ho also overseesour Marketing Department and plays aleading role in formulating the Group’smarketing policies and strategies. Hespearheads our Group’s businessdevelopment activities and looks after ourGroup’s key accounts. Prior to joining theCompany in 1981, he was a SeniorHydrologist with the Public Utilities Boardof Singapore for 5 years. Dr Ho graduatedwith a Bachelor of Arts (1st Class Honours)degree from Nanyang University. Heholds a Ph.D. in Hydrology from theUniversity of Hull, UK and a Diploma ofBusiness Studies from the GraduateSchool of Business of the University ofChicago. He is a member of the Societyof Tribologists and Lubrication Engineers,USA.

A N N U A L R E P O R T 2 0 0 210

board of directors

Mr Ang Luck SehDirector (Operations)Member, Nominating Committee

Mr Ang was appointed as a Director ofthe Company in March 2001. As Director(Operations), he is responsible foroperational management of theCompany and APP(S). In addition tooverseeing the day-to-day businessactivities, he is also responsible forevaluation of new projects and theManagement Representative of ourCompany’s ISO Committee. Prior tojoining our Group in 1993, he was aSuperintendent with the Customs andExcise Department for 20 years. Mr Angholds a Bachelor of Arts (Honours) degreefrom Nanyang University and a Diplomaof Management Studies from theSingapore Institute of Management.

Dr Lim Heng KowIndependent DirectorChairman, Remuneration CommitteeMember, Audit CommitteeMember, Nominating Committee

Dr Lim was appointed an IndependentDirector of the Company in March 2001.He is currently a Director of ChinaMerchants Holdings (Pacific) Ltd and WeePoh Holdings Ltd. Dr Lim was anExecutive Director and Managing Directorrespectively of Apollo Enterprise Ltd in1989 and 1990. He was a GeneralManager (Overseas Development) of CityDevelopment Ltd in 1991. Dr Lim hasserved as a senior consultant in Shenzhen,Hainan, Chongqing, China over the years.He holds a Ph.D from the University ofLondon, a Master degree from Universityof Ibadan (formerly a London UniversityCollege) and a Bachelor degree fromNanyang University.

Mr Ong Sim HoIndependent DirectorChairman, Audit CommitteeChairman, Nominating CommitteeMember, Remuneration Committee

Mr Ong is a practicing lawyer, headinghis own firm which specializes in tax lawand corporate oil and gas laws. He haspublished a few tax law books and hasrecently been regarded by the Asian LegalBusiness Legal Who's Who 2003 as oneof the best lawyers in Tax Law categoryin Singapore. Mr Ong is also a CertifiedPublic Accountant and prior to privatelegal practice, he was legal counsel in theInland Revenue Authority of Singapore.He graduated with both a law honoursdegree from London University and anaccountancy honours degree from NTUin 1993.

A N N U A L R E P O R T 2 0 0 2 11

corporate governance statement

Board of Directors

Board’s Conduct of its Affairs (Principle 1)

The principal functions of the Board are:

1) Approval of broad policies, strategies and financial objectives of the Company and monitoring the performance of management

2) Approval of nominations of board directors

3) Appointment and removal of auditor with nomination and recommendation from Audit Committee

4) Approval of major investment and divestment proposals

5) Assuming responsibility for corporate governance

The Board meets at least twice a year. When the need arises, ad-hoc meetings are arranged. The attendance of the directors at meetings of theBoard and Board Committees, as well as frequency of such meetings, are disclosed in this Report.

The Company works closely with a professional corporate secretarial firm, FMG Corporate Services Pte Ltd, to provide its directors with regularupdates on the latest governance and listing policies. All directors are also updated regularly concerning changes in Company policies.

As an integral element of on-going training, the Nominating Committee (NC) encourages the existing directors to attend conferences andseminars, or any course of instruction/training program in connection with their duties as directors.

Directors are also welcome to request further explanations, briefings or informal discussions on any aspect of the Company’s operations orbusiness issues from the management. The Chairman/CEO will make the necessary arrangements for the briefing, informal discussions orexplanations required by the directors.

Board Composition and Balance (Principle 2)

The Board consists of two non-executive and independent directors and three executive directors. A brief description on the background ofeach director is presented in pages 9 and 10.

Non-executive directors provide effective contributions to the Board in terms of knowledge, business contacts as well as broad and in-depthbusiness and commercial experience. This balance is particularly important in ensuring that the strategies proposed by the executive managementare fully discussed and examined taking into account the long-term interests of the Company and of the Group.

The Board is of the view that its current size, comprising five directors is appropriate, taking into account the size, nature and scope of theCompany’s operations.

The Article of the Company requires one third of the Board (other than the Managing Director) to retire by rotation at every AGM and anyretiring director shall be eligible for election.

Role of Chairman and Chief Executive Officer (Principle 3)

The Company has the same Chairman and CEO, Dr. Ho Leng Woon, and he is an executive director.

The Board believes that the independent directors have demonstrated high commitment in their role as directors and have ensured that thereis a good balance of power and authority. As such there is no need for the role of the Chairman and CEO to be separated.

The Chairman is the most senior executive in the Company and bears executive responsibility for the Company’s business and also bearsresponsibility for the workings of the Board. The Chairman ensures that Board meetings are held when necessary and sets the board meetingagenda in consultation with the directors. The Chairman reviews most board papers before they are presented to the Board and ensures that


A N N U A L R E P O R T 2 0 0 212

board members are provided with complete, adequate and timely information. As a general rule, board papers are sent to directors in advancein order for directors to be adequately prepared for the meeting. Management staff who have prepared the papers, or who can provideadditional insight into the matters to be discussed, are invited to present the paper or attend at the relevant time during the Board meeting.

Access to information (Principle 6)

In order to ensure that the Board is able to fulfill its responsibilities, management provides the Board members with regular updates of thefinancial position of the Company. With effect from the current year, a quarterly report of the Company’s activities is also provided to theBoard. The directors have also been provided with the phone numbers and e-mail particulars of the Company’s senior management and thecompany secretary to facilitate access.

Where directors need independent professional advice, the Board may appoint a professional advisor selected by the directors and approved bythe Chairman and CEO to render the advice. The Company shall bear the cost of such professional advice.

The company secretaries attend all Board meetings and are responsible to ensure that Board procedures are followed. It is the Board’s responsibility,with the assistance of the company secretaries to ensure that the Company complies with the Companies Act, Cap. 50 and SGX regulations.

Board Committees

Nominating Committee (“NC”) (Principle 4)

The NC comprises of three members, two of whom are independent non-executive directors.

The Chairman of the NC, Mr. Ong Sim Ho, is an independent non-executive director.

The NC’s principal functions are:

• To identify candidates and review all nominations for the appointment of members of the Board of Directors; the CEO of the Company;and members of the various Board committees for the purpose of proposing such nominations to the Board for its approval;

• To determine the criteria for identifying candidates and reviewing nominations for the appointments referred to above. One of thecriteria for appointment of a director is the independent status of the candidate; and

• To decide how the Board’s performance may be evaluated and propose objective performance criteria for the Board’s approval.

Board Performance (Principle 5)

The NC in considering the re-appointment of any directors, evaluates the performance of the director. With effect from 2003 the Chairman/CEOwill assess each director’s contribution to the Board, and discuss the results with the Chairman of the NC. The assessment parameters includeattendance record at meetings of the Board and Board committees, participation at meetings, quality of interventions and special contributions.

The Company has just set up the NC and no meeting was held in 2002. The NC will evaluate the Board’s performance as a whole with effectfrom 2003. The assessment process shall adopt both quantitative and qualitative criteria, such as profitability, the success of strategic and long-term objectives set by the Board and the effectiveness of the Board in monitoring management’s performance against the goals that have beenset by the Board.

Audit Committee (“AC”)

Audit Committee (Principle 11)Internal Controls (Principle 12)

The AC comprises three members, two of whom are independent non-executive directors.


A N N U A L R E P O R T 2 0 0 2 13

The chairman of the AC, Mr. Ong Sim Ho, is a Solicitor and Accountant by profession with many years of experience in tax and corporate lawservices. The other members of the AC have wide experience in business management.

The AC performs the following main functions:

• Recommends to the Board the external auditors to be nominated and reviews the scope and results of the audit and its cost effectiveness;

• Reviews results reporting to SGX and year end financial statements of the Group before submission to the Board;

• Recommends to the Board independent professional internal auditors to be nominated and reviews scope and any significant findingsof the internal auditors with the Board; and

• Reviews interested party transactions and conflict of interest situation that may arise within the Group or Company.

The AC is authorised by the Board to conduct investigations into any matters within its terms of reference.

The Company’s external auditors, Chio Lim & Associates, carry out in the course of their statutory audit, a review of the effectiveness of theCompany’s internal controls, including financial and compliance controls and risk management annually to the extent of their scope as laid outin their audit plan. Non-compliance and internal control weaknesses noted during their audit and the auditors’ recommendations are reportedto the AC. The Management follows up on the auditors’ recommendations and takes steps to implement the agreed recommendations.

The AC has reviewed the Company’s risk management. Based on the external auditors’ reports and management controls in place, the AC issatisfied that there are adequate internal controls in the Company. The AC shall seek independent professional internal audit services witheffect from 2003.

There was no material contract with the Company and its subsidiaries which involved the directors or controlling shareholders.

Internal Audits (Principle 13)

The main function of internal audit is to review the effectiveness of the system of internal control and this is performed with impartiality,proficiency and due professional care.

The AC and the Board agreed that it would be more cost effective to outsource the internal audit function. The AC recommended and theBoard appointed Nexia Tan & Sitoh to carry out the internal audit functions with effect from 2003.

Remuneration Committee (‘RC”)

Procedures for Developing Remuneration Policies (Principle 7)Level and Mix of Remuneration (Principle 8)Disclosure on Remuneration (Principle 9)

The RC consists of three members, of whom two are independent and non-executive directors.

The Chairman of the RC is Dr. Lim Heng Kow, an independent and non-executive director.

The RC’s principal responsibilities are to:

• Approve the structure of the compensation program for directors and senior management to ensure that the program is competitiveand sufficient to attract, retain and motivate senior management of the required quality to run the Company successfully; and

• Review directors’ and senior management’s compensation annually and determine appropriate adjustments.


A N N U A L R E P O R T 2 0 0 214

The CEO and executive directors’ remuneration packages include a variable bonus element which is performance related.

Directors’ fees are set in accordance with remuneration framework comprising basic fees. Executive directors do not receive directors’ fees. Non-executive directors are paid directors’ fees subject to approval at AGM.

The Company is disclosing the band of remuneration of directors in note 33 to the financial statements.

The Company adopts a remuneration policy for staff comprising a fixed component and a variable component. The fixed component is in formof a basic salary. The variable component is in the form of a variable bonus that is linked to the Company’s and individual’s performance.

The Company has just set up the RC. No meeting was held in 2002.

Communication with Shareholders

Accountability and Audit (Principle 10)Communication with Shareholders (Principle 14)Greater Shareholder Participation (Principle 15)

The Company adopts results reporting in compliance with SGX’s regulations and the annual report to the shareholders. The Company heldbriefings for the media and analysts for its half-year and full-year results. This is carried out with the assistance of a professional public andinvestor relations firm. In addition, appropriate news releases on the results are disseminated to the major media in Singapore. The results andthe relevant press releases are published through the MASNET and Zaobao.com. The AC assists the Board in scrutinizing information fordisclosure to ensure accuracy and completeness.

In developing and implementing an investor relations program, regular discussions are held between the CEO and analyst/bankers/stakeholders/investors throughout the year. Presentations based on permissible disclosure are made to explain the Group’s performance and majordevelopments. Price sensitive information about the Group is not disclosed in these discussions until after the announcement to SGX has beenmade. Results and annual reports are announced or issued within the mandatory period.

The Company communicates with its investors on regular basis and attends to their queries. The Company’s investor relations programme iscarried out by a professional public and investor relations firm, on a retainer basis. All shareholders of the Company receive the annual reportand notice of AGM. The notice is also advertised in newspapers and made available on the MASNET. At AGMs, shareholders are given theopportunity to air their views and ask directors or management questions regarding the Company.

The Articles allow a member of the Company to appoint one or two proxies to attend and vote for the member.

Dealing in Securities

The Company has adopted internal codes pursuant to SGX-ST Best Practice Guide applicable to all officers in relation to dealings in the Company’ssecurities. Its officers are not allowed to deal in the Company’s shares during the period commencing one month before the announcement ofthe Company’s results and ending one day after the date of the announcement of the results.

Dr. Ho Leng WoonChairman and Managing Director


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Board of Directors Audit Committee

Name No. of No. of No. of No. ofmeetings held meetings attended meetings held meetings attended

Dr Ho Leng Woon 3 3 4 4

Mdm Lau Woon Chan 3 3 na na

Mr Ang Luck Seh 3 3 na na

Dr Lim Heng Kow 3 3 4 4

Mr Ong Sim Ho 2 2 3 3(appointed on 1 June 2002)

Dr Tan Poi Sik 1 1 1 1(resigned on 1 June 2002)

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group financial highlights

REVENUE AND PROFIT

Group Company

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Net Revenue (S$’000) 76,490 34,596 70,945 28,592

Gross profit margin

- In S$’000 8,491 5,738 6,719 4,228

- In % 11.1% 16.6% 9.5% 14.7%

Net profit before tax

- In S$’000 3,288 2,526 3,410 2,119

- In % 4.3% 7.3% 4.8% 7.4%

Net profit after tax & minority interest

- In S$’000 2,392 1,905 2,618 1,659

- In % 3.1% 5.5% 3.7% 5.8%

GROUP SUMMARY

Net profit after tax & minority interest

- % of issued capital and reserves 18.9% 18.0%

Earning per sharea (cents)

- Basic 2.73 2.37

- Diluted 2.73 2.37

Net tangible asset backing per ordinary shareb (cents) 14.16 11.67

Number of shares at par value of $0.05 each

a. Weighted average 87,750,000 80,437,500

b. Total outstanding 87,750,000 87,750,000

group financial highlights

A N N U A L R E P O R T 2 0 0 2 17

Report of the Directors 18

Statement of Directors 23

Auditors’ Report 24

Balance Sheets 25

Income Statements 27

Statements of Changes in Equity 28

Consolidated Cash Flow Statement 30

Notes to Financial Statements 32

financial contents

A N N U A L R E P O R T 2 0 0 218

report of the directors


The directors of the Company are pleased to present their report together with the audited financial statements of the Company and of theGroup for the financial year ended 31 December 2002.

1. DIRECTORS AT DATE OF REPORT

The directors of the Company in office at the date of this report are:

Ang Luck SehHo Leng Woon, DrLau Woon ChanLim Heng Kow, DrOng Sim Ho – appointed on 1 June 2002

2. PRINCIPAL ACTIVITIES

The principal activities of the Company are those of manufacturing lubricating oil, importers and exporters of oil and fuel, and dealersin paraffin wax, lubricating oil and grease and investment holding.

The principal activities of the subsidiary companies are as disclosed in Note 9 to the financial statements.

There have been no significant changes in the nature of these activities during the financial year.

3. RESULTS FOR THE FINANCIAL YEARGroup Company

$’000 $’000

Net profit for the year 2,392 2,618Accumulated profits at beginning of year 3,985 3,495Dividend paid (303) (303)

Accumulated profits at end of year 6,074 5,810

4. MATERIAL TRANSFERS TO OR FROM RESERVES OR PROVISIONS

During the financial year, there were no material transfers to or from reserves and provisions other than those disclosed in the financialstatements.

5. ACQUISITIONS AND DISPOSALS OF SUBSIDIARIES

During the financial year, the Group incorporated a subsidiary in Vietnam known as AP Petrochemical (Vietnam) Co., Ltd. The Group’s80% interest in this subsidiary is held through AP Petrochemical Pte Ltd.

There were no disposals of subsidiaries during the financial year.

A N N U A L R E P O R T 2 0 0 2 19

6. ISSUE OF SHARES AND DEBENTURES

During the financial year, the Company or subsidiaries in the Group did not issue any shares or debentures except as follows :

The Group has an 80% interest in AP Petrochemical (Vietnam) Co., Ltd. In accordance with the joint venture agreement, the Group isrequired to contribute USD1,200,000 as its 80% share of the legal capital of AP Petrochemical (Vietnam) Co., Ltd. The Group hascontributed capital of USD233,520 (S$405,386 equivalent) during the year, with a balance of USD966,480 (approximately S$1.7million)to be contributed.

7. ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE BENEFITS BY MEANS OF THE ACQUISITION OF SHARES AND DEBENTURES

Neither at the end of the financial year nor at any time during the financial year did there subsist any arrangement whose object is toenable the directors of the Company to acquire benefits by means of the acquisition of shares or debentures in the Company or anyother body corporate.

8. DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES

The directors holding office at the end of the financial year had no interests in the share capital and debentures of the Company andrelated corporations as recorded in the register of directors’ shareholdings kept by the Company under section 164 of the CompaniesAct, Cap. 50 except as follows:

Held in the name of directors

At 1/1/2002 or date At Atof appointment, if later 31/12/2002 21/1/2003

In the Company – Ordinary shares Ordinary shares Ordinary sharesof $0.05 each of $0.05 each of $0.05 each

AP Oil International LtdAng Luck Seh 450,000 570,000 620,000Ho Leng Woon, Dr 38,250,000 38,250,000 38,250,000Lau Woon Chan 14,850,000 14,850,000 14,850,000Lim Heng Kow, Dr 150,000 150,000 150,000

Ho Leng Woon, Dr is deemed to be interested in the 14,850,000 shares held by his wife, Lau Woon Chan.

Lau Woon Chan is deemed to be interested in 38,250,000 shares held by her husband, Ho Leng Woon, Dr.

By virtue of Section 7 of the Companies Act, Cap. 50 Ho Leng Woon, Dr and Lau Woon Chan are deemed to have an interest in all therelated companies of the Company.


A N N U A L R E P O R T 2 0 0 220


9. DIVIDENDS

Dividends paid or declared since the end of the Company’s last financial year were as follows:

(i) A final dividend of 0.242 cents per ordinary share less tax on the ordinary shares of the Company totalling $165,848 in respectof the previous year and included in the previous report of the directors.

(ii) An interim dividend of 0.20 cents per ordinary share less tax on the ordinary shares of the Company totalling $136,890 inrespect of the financial year just ended.

(iii) A proposed final dividend of 0.20 cents per ordinary share less tax on the ordinary shares of the Company totalling $136,890 inrespect of the financial year just ended.

(iv) A proposed special dividend of 0.95 cents per ordinary share less tax on the ordinary shares of the Company totalling $650,228in respect of the financial year just ended.

10. ACTIONS RELATING TO BAD AND DOUBTFUL DEBTS

Before the income statement and the balance sheet were made out, the directors of the Company took reasonable steps to ascertainthat proper action had been taken in relation to the writing off of and the making of provision for bad and doubtful debts of theCompany and have satisfied themselves that all known bad debts if any of the Company have been written off and that wherenecessary adequate provision has been made for doubtful debts.

At the date of this report, the directors of the Company are not aware of any circumstances which would render amounts if any writtenoff or the amount of provision for bad and doubtful debts for the Group of Companies in the consolidated financial statements of theCompany inadequate to any substantial extent.

11. ACTIONS RELATING TO CURRENT ASSETS

Before the income statement and the balance sheet were made out, the directors of the Company took reasonable steps to ascertainthat any current assets of the Company which were unlikely to realise in the ordinary course of business their book values have beenwritten down to their estimated realisable values or were adequately provided for.

At the date of this report, the directors of the Company are not aware of any circumstances which would render the value attributableto current assets in the consolidated financial statements misleading.

12. CHARGES ON ASSETS AND EXISTENCE OF CONTINGENT LIABILITIES AFTER YEAR END DATE

At the date of this report:

a) there does not exist any charge on the assets of the Company or any corporation in the Group which has arisen since the endof the financial year which secures the liability of any other person; and

b) there does not exist any contingent liability of the Company or any corporation in the Group which has arisen since the end ofthe financial year.

A N N U A L R E P O R T 2 0 0 2 21

13. ABILITY TO MEET OBLIGATIONS

No contingent or other liability of the Company or any corporation in the Group has become enforceable or is likely to becomeenforceable within the period of twelve months after the end of the financial year which, in the opinion of the directors of theCompany, will or may substantially affect the ability of the Company or any corporation in the Group to meet their obligations as andwhen they fall due.

14. OTHER CIRCUMSTANCES AFFECTING FINANCIAL STATEMENTS

At the date of this report, the directors of the Company are not aware of any circumstances not otherwise dealt with in the report orconsolidated financial statements which would render any amount stated in the financial statements of the Company and the consolidatedfinancial statements misleading.

15. UNUSUAL ITEMS DURING THE YEAR

In the opinion of the directors of the Company, the results of the operations of the Company and of the Group have not beensubstantially affected by any item, transaction or event of a material and unusual nature during the financial year.

16. UNUSUAL ITEMS AFTER YEAR END DATE

In the opinion of the directors of the Company, no item, transaction or event of a material and unusual nature has arisen in the intervalbetween the end of the financial year and the date of the report which would affect substantially the results of the operations of theCompany and of the Group for the financial year in which this report is made.

17. CONTRACTUAL BENEFITS OF DIRECTORS

Since the beginning of the financial year, no director has received or become entitled to receive a benefit which is required to bedisclosed under section 201(8) of the Companies Act, Cap. 50 by reason of a contract made by the Company or a related corporationwith the director or chief executive officer or controlling shareholder or with a firm of which he is a member, or with a company inwhich he has a substantial financial interest. Certain directors of the Company received remuneration from related corporations in theircapacity as directors and or executives of those related corporations.

18. OPTIONS TO TAKE UP UNISSUED SHARES

During the financial year, no option to take up unissued shares of the Company or any corporation in the Group was granted.

19. OPTIONS EXERCISED

During the financial year, there were no shares of the Company or any corporation in the Group issued by virtue of the exercise of anoption to take up unissued shares.

20. UNISSUED SHARES UNDER OPTION

At the end of the financial year, there were no unissued shares of the Company or any corporation in the Group under option.


A N N U A L R E P O R T 2 0 0 222

report of directors

21. AUDIT COMMITTEE

The members of the Audit Committee at the date of this report are as follows:-

Ong Sim Ho (Chairman and Independent Director)Lim Heng Kow, Dr (Independent Director)Ho Leng Woon, Dr (Managing Director)

The audit committee performed the functions specified by section 201B of the Companies Act, Cap 50, and the Listing Manual and theBest Practices Guide of the Singapore Exchange (“SGX”). The audit committee held two meetings since the last directors’ report. It metwith the Company’s external auditors to discuss the scope of their work and the results of their examination and evaluation of theCompany’s internal accounting control system.

The audit committee also reviewed the following:-

• Assistance provided by the Company’s officers to the external auditors;

• Financial statements of the Group and the Company prior to their submission to the directors of the Company for adoption;and

• Interested person transactions (as defined in Chapter 9 of the Listing Manual of SGX), if any.

The audit committee has full access to management and is given the resources required for it to discharge its functions. It has fullauthority and discretion to invite any director or executive officer to attend its meetings.

The audit committee has recommended to the board of directors that the auditors, Chio Lim & Associates, be nominated forre-appointment as auditors at the next annual general meeting of the Company.

22. AUDITORS

The auditors, Chio Lim & Associates, have expressed their willingness to accept re-appointment.

23. DEVELOPMENTS SUBSEQUENT TO THE ANNOUNCEMENT OF RESULTS

There are no significant developments subsequent to the release of the Group’s and Company’s preliminary financial statements, asannounced on 7 March 2003, which would materially affect the Group’s and Company’s operating and financial performance as of thedate of this report.

On behalf of the Directors,

Ho Leng Woon, Dr Lau Woon ChanDirector Director

8 March 2003

A N N U A L R E P O R T 2 0 0 2 23

statement of directors

In the opinion of the directors, the accompanying financial statements are drawn up so as to give a true and fair view of the state of affairs ofthe Company and of the Group as at 31 December 2002 and of the results of the business and changes in equity of the Company and of theGroup and cash flows of the Group for the financial year then ended and at the date of this statement there are reasonable grounds to believethat the Company will be able to pay its debts as and when they fall due.

On behalf of the Directors,

Ho Leng Woon, Dr Lau Woon ChanDirector Director

8 March 2003

statement of directors

A N N U A L R E P O R T 2 0 0 224

auditors’ report

AUDITORS’ REPORT TO THE MEMBERS OF AP OIL INTERNATIONAL LTD

We have audited the accompanying financial statements of AP Oil International Ltd and of the Group for the year ended 31 December 2002 setout on pages 25 to 52. These financial statements are the responsibility of the Company’s directors. Our responsibility is to express an opinionon these financial statements based on our audit.

We conducted our audit in accordance with Singapore Standards on Auditing. Those Standards require that we plan and perform the audit toobtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a testbasis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principlesused and significant estimates made by the directors, as well as evaluating the overall financial statement presentation. We believe that ouraudit provides a reasonable basis for our opinion.

In our opinion:

a) the accompanying financial statements and consolidated financial statements are properly drawn up in accordance with the provisionsof the Singapore Companies Act, Cap. 50 (“the Act”) and Statements of Accounting Standard in Singapore and interpretations of thosestandards and so as to give a true and fair view of:

i) the state of affairs of the Company and of the Group as at 31 December 2002, and of the results and changes in equity of theCompany and of the Group and cash flows of the Group for the financial year then ended; and

ii) the other matters required by section 201 of the Act to be dealt with in the financial statements and consolidated financialstatements;

b) the accounting and other records and the registers required by the Act to be kept by the Company and those subsidiaries incorporatedin Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act.

We have considered the financial statements and auditors’ reports of all subsidiaries of which we have not acted as auditors, being financialstatements included in the consolidated financial statements. The names of these subsidiaries are stated in note 9 to the financial statements.

We are satisfied that the financial statements of the subsidiaries that are consolidated with the financial statements of the Company are in formand content appropriate and proper for the purposes of the preparation of the consolidated financial statements, and we have receivedsatisfactory information and explanations as required by us for those purposes.

The auditors’ reports on the financial statements of the subsidiaries were not subject to any qualification and in respect of the subsidiariesincorporated in Singapore, did not include any comment made under section 207(3) of the Act.

Chio Lim & AssociatesCertified Public Accountants

Partner-in-charge of audit: Paul Lee Seng Meng

Effective from financial year ended: 31 December 1999

Singapore8 March 2003

auditors’ report

A N N U A L R E P O R T 2 0 0 2 25

balance sheets

balance sheetsas at 31 December 2002

Group Company

Notes 2002 2001 2002 2001

$’000 $’000 $’000 $’000

ASSETS

Current assets:

Cash and cash equivalents 4 5,413 4,927 3,637 3,519

Marketable securities 5 81 102 - -

Trade receivables 6 9,833 10,903 8,644 9,684

Other receivables and prepayments 7 46 65 562 242

Inventories 8 2,587 3,326 2,447 3,182

Total current assets 17,960 19,323 15,290 16,627

Non-current assets:

Investment in subsidiaries 9 - - 2,877 2,877

Other investments 10 8 11 8 11

Property, plant and equipment 11 3,701 3,175 1,119 1,120

Goodwill 12 251 351 - -

Total non-current assets 3,960 3,537 4,004 4,008

Total assets 21,920 22,860 19,294 20,635

LIABILITIES AND EQUITY

Current liabilities:

Short-term borrowings 13 - 1,922 - 1,922

Trade payables and accrued liabilities 14 6,981 8,840 5,938 7,725

Other payables 15 62 41 - -

Income tax payable 1,168 972 767 714

Provisions 16 203 207 - -

Current portion of finance leases 17 72 - - -

Total current liabilities 8,486 11,982 6,705 10,361

A N N U A L R E P O R T 2 0 0 226

balance sheets

Group Company

Notes 2002 2001 2002 2001

$’000 $’000 $’000 $’000

Non-current liabilities:

Deferred tax 24 243 287 173 173

Finance leases 17 35 - - -

Total non-current liabilities 278 287 173 173

Minority interests 476 - - -

Capital and reserves:

Issued capital 18 4,388 4,388 4,388 4,388

Reserves 8,292 6,203 8,028 5,713

12,680 10,591 12,416 10,101

Total liabilities and equity 21,920 22,860 19,294 20,635

See accompanying notes to financial statements.

A N N U A L R E P O R T 2 0 0 2 27

income statements

income statementsfor the year ended 31 December 2002

Group Company

Notes 2002 2001 2002 2001

$’000 $’000 $’000 $’000

Revenue 19 76,490 34,596 70,945 28,592

Cost of sales (67,999) (28,858) (64,226) (24,364)

Gross profit 8,491 5,738 6,719 4,228

Other operating income 20 485 469 751 180

Distribution expenses (1,190) (1,181) (1,124) (1,064)

Administrative expenses (3,349) (2,795) (1,758) (1,497)

Other credits/(charges) 21 (1,067) 468 (1,098) 442

Profit from operations 22 3,370 2,699 3,490 2,289

Finance costs 23 (82) (173) (80) (170)

Profit before income tax 3,288 2,526 3,410 2,119

Income tax expense 24 (929) (621) (792) (460)

Profit after income tax 2,359 1,905 2,618 1,659

Minority interests 33 - - -

Net profit for the year 2,392 1,905 2,618 1,659

Earning per share (cents) 25

- Basic 2.73 2.37

- Diluted 2.73 2.37


A N N U A L R E P O R T 2 0 0 228

statements of changes in equity

statements of changes in equityfor the year ended 31 December 2002

Issued Share Accumulated

Capital Premium Profits Total

$’000 $’000 $’000 $’000

Group

Balance at 31 December 2000 1,560 - 4,030 5,590

Net profit for the year - - 1,905 1,905

Issue of share capital 878 3,247 - 4,125

IPO expenses not recognised in the income statement - (1,029) - (1,029)

Bonus issue by way of capitalisation 1,950 - (1,950) -

Balance at 31 December 2001 4,388 2,218 3,985 10,591


Dividends (Note 26) - - (303) (303)


Company

Balance at 31 December 2000 1,560 - 3,786 5,346


Issue of share capital 878 3,247 - 4,125

IPO expenses not recognised in the income statement - (1,029) - (1,029)

Bonus issue by way of capitalisation 1,950 - (1,950) -



Dividends (Note 26) - - (303) (303)


A N N U A L R E P O R T 2 0 0 2 29

(i) As at 31 December 2002, the distributable and non-distributable reserves are analysed as follows :

Group Company

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Distributable 6,074 3,985 5,810 3,495

Non-distributable 2,218 2,218 2,218 2,218

8,292 6,203 8,028 5,713

(ii) Included in listing expenses for 2001 was an amount of $86,000 paid to the company’s auditors for services rendered as Reporting

Accountant.

statements of changes in equity

A N N U A L R E P O R T 2 0 0 230

consolidated cash flow statement

consolidated cash flow statementfor the year ended 31 December 2002

2002 2001

$’000 $’000

Cash flows from operating activities:

Profit before income tax 3,288 2,526

Adjustments for:

Amortisation of goodwill 100 101

Depreciation expenses 723 812

Gain on disposal of investment property - (404)

Marketable securities written down 24 -

Gain on disposal of plant and equipment (54) (5)

Preliminary expenses written-off - 12

Product warranty provision (4) -

Interest income (65) (56)

Interest expense 82 173

Operating profit before working capital changes 4,094 3,159

Trade receivables 1,070 (6,988)

Other receivables and prepayments 19 418

Inventories 739 366

Marketable securities - (102)

Trade payables and accrued liabilities (1,859) 5,403

Other payables 21 (124)

Cash generated from operations 4,084 2,132

Interest income received 65 56

Interest expense paid (82) (173)

Income tax paid (777) (1,086)

Net cash from operating activities 3,290 929

Cash flows from investing activities:

Acquisition of property, plant and equipment (Note 27) (1,095) (198)

Proceeds from disposal of plant and equipment 55 14

Proceeds from disposal of investment property - 4,500

Net cash (used in)/from investing activities (1,040) 4,316

A N N U A L R E P O R T 2 0 0 2 31

2002 2001

$’000 $’000

Cash flows from financing activities:

Decrease in finance leases (48) (63)

Decrease in borrowings (1,811) (6,574)

Dividends paid (303) (349)

Proceeds from issue of new shares, net of expenses - 3,096

Minority contribution to capital 509 -

Net cash used in financing activities (1,653) (3,890)

Net increase in cash 597 1,355

Cash at beginning of year 4,816 3,461

Cash at end of year (Note 27) 5,413 4,816


consolidated cash flow statement

A N N U A L R E P O R T 2 0 0 232

notes to financial statements

notes to financial statements31 December 2002

1. GENERAL

The Company is incorporated in Singapore. The financial statements are expressed in Singapore dollars. They are drawn up in accordancewith the provisions of the Companies Act, Cap 50 and Statements of Accounting Standard in Singapore and related interpretations ofthose standards. The financial statements were approved and authorised for issue by the board of directors on 8 March 2003.

The Company is listed on the Stock Exchange of Singapore Dealing and Automated Quotation System (“SESDAQ”)

The principal activities of the Company are those of manufacturing lubricating oil, importers and exporters of oil and fuel, and dealersin paraffin wax, lubricating oil and grease and investment holding.

The principal activities of the subsidiaries are as disclosed in Note 9 to the financial statements.

The registered office address of the Company is: 30 Gul Crescent Jurong Singapore 629535. The Company is domiciled in Singapore.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ACCOUNTING CONVENTION – The financial statements are prepared under the historical cost convention.

BASIS OF PRESENTATION – The consolidation accounting method is used for the consolidated financial statements which include thefinancial statements made up to 31 December each year of the Company and of those companies in which it holds, directly or indirectlythrough subsidiaries, over 50 percent of the shares and voting rights. All significant intercompany balances and transactions have beeneliminated on consolidation. The results of the investees acquired or disposed of during the financial year are consolidated from therespective dates of acquisition or up to the dates of disposal. On disposal the attributable amount of unamortised goodwill is includedin the determination of the gain or loss on disposal.

GOODWILL – Goodwill or negative goodwill arising on acquisition is based on the purchase method. Goodwill arising on consolidationrepresents the excess of the cost of acquisition over the Group’s interest in the fair value of the identifiable assets and liabilities of asubsidiary, associate or jointly controlled entity at the date of acquisition. Goodwill is recognised as an asset and is amortised over 5years.

MINORITY INTERESTS – Minority interests are stated at the appropriate proportion of the post-acquisition values of the identifiableassets and liabilities of the subsidiaries.

SUBSIDIARIES – In the Company’s own financial statements, the investments in subsidiaries are carried at cost less any provision forimpairment in value which is other than temporary. The book values of the subsidiaries are not necessarily indicative of the amountsthat would be realised in a current market exchange.

REVENUE RECOGNITION – Revenue from sale of goods is recognised when significant risks and rewards of ownership are transferredto the buyer and the amount of revenue and the costs of the transaction (including future costs) can be measured reliably. Revenuefrom rendering of services that are of short duration is recognised when services are completed. Revenue from rental is recognised ona time-proportion basis over the tenancy period.

Dividend revenue is recognised when the shareholders’ right to receive the dividend is legally established.

INVENTORIES – Inventories are measured at the lower of cost weighted average method and net realisable value. In respect offinished goods, cost includes material, direct labour and an appropriate portion of production overheads expenditure.

A N N U A L R E P O R T 2 0 0 2 33

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

FINANCE LEASES – A finance lease is recognised as an asset and as liability in the balance sheet at amounts equal at the inception of thelease to the fair value of the leased assets or, if lower, at the present value of the lease payments based on the interest rate implicit inthe lease. The excess of the lease payments over the recorded lease obligations are treated as finance charges which are allocated toeach lease term so as to produce a constant rate of charge on the remaining balance of the obligations. The assets are depreciated asowned depreciable assets.

FOREIGN CURRENCY TRANSACTIONS – Transactions in foreign currencies are recorded in Singapore dollars at the rates ruling at thedates of the transactions. At each balance sheet date, recorded monetary balances and balances carried at fair value that are denominatedin foreign currencies are reported at the rates ruling at the balance sheet date. All realised and unrealised exchange adjustment gainsand losses are dealt with in the income statement.

FOREIGN CURRENCY FINANCIAL STATEMENTS – Assets and liabilities of self-sustaining subsidiaries denominated in currencies otherthan Singapore dollars are translated at the year end rates of exchange and the results of their operations are translated at averagerates of exchange for the year. The resulting translation adjustments are accumulated in a separate component of shareholders’ equityuntil the disposal of the subsidiary.

RETIREMENT BENEFITS COSTS – Contributions to defined contribution retirement benefit plans are recorded as an expense as they falldue. Contributions made to government managed retirement benefit plan such as the Central Provident Fund in Singapore whichspecifies the employer’s obligations are dealt with as defined contribution retirement benefit plans.

NON-CURRENT INVESTMENTS – Non-current listed and unlisted investments held as available-for-sale financial assets included undernon-current assets are stated at cost and any impairment in value which is other than temporary is recognised in the income statement.

DEPRECIATION – Depreciation is computed to write off the cost of the assets over their estimated useful lives. The annual rates ofdepreciation are as follows:-

Leasehold properties – over term of leases which are from 2.5% to 5%Plant and equipment – 10% to 33.3%

Fully depreciated assets still in use are retained in the financial statements.

NON-CURRENT ASSETS – Non-current assets such as property, plant and equipment and investments are reviewed for impairmentwhenever events or changes in circumstances indicate that the net book value of these assets may not be recoverable. Impairmentlosses are determined based on the difference between fair value, which would generally approximate estimated future cashflowsdiscounted at the Group’s cost of capital or where appropriate the sale value and net book value.

INCOME TAX – The income taxes are accounted using the asset and liability method which requires the recognition of taxes payable orrefundable for the current year and deferred tax liabilities and assets for the future tax consequence of events that have been recognisedin the financial statement or tax returns. The measurements of current and deferred tax liabilities and assets are based on provisions ofthe enacted tax laws; the effects of future changes in tax laws or rates are not anticipated. The measurement of deferred tax assets isreduced, if necessary, by the amount of any tax benefits that, based on available evidence, are not expected to be realised.

MARKETABLE SECURITIES – Marketable securities held as trading financial assets included under current assets are stated at fair valueusing the portfolio basis. The transactions are recorded at the trade date. A gain or loss on remeasuring trading financial assets to fairvalue (other than those relating to hedges) is recognised in the income statement.


A N N U A L R E P O R T 2 0 0 234


2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

ACCOUNTING ESTIMATES – The preparation of financial statements in conformity with generally accepted accounting principlesrequires the directors to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure ofcontingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during thereporting period. Actual results could differ from those estimates.

CASH – Cash for the cashflow statement includes cash and cash equivalents less bank overdrafts.

FAIR VALUE OF FINANCIAL INSTRUMENTS – The carrying value of cash, accounts receivable, other current assets, short-term borrowings,accounts payables and other current liabilities approximate their fair market values due to the short-term maturity of these instruments.The fair vaue of long-term debt was not determined as there are no significant items as at the end of the year.

LIABILITIES AND PROVISIONS – A liability and provision is recognised when there is a present obligation (legal or constructive) as aresult of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligationand a reliable estimate can be made of the amount of the obligation.

CREDIT RISK ON FINANCIAL ASSETS – Financial assets that are potentially subject to concentrations of credit risk consist principally ofcash, cash equivalents and trade and other accounts receivable. The directors believe that the financial risks associated with thesefinancial instruments are minimal. The Group and Company place their cash and cash equivalents with high credit quality institutions.The Group and Company perform ongoing credit evaluation of their debtors’ financial condition and maintains a provision for doubtfulaccounts receivable based upon the expected collectibility of all accounts receivable.

OTHER RISKS ON FINANCIAL INSTRUMENTS – The Group and Company monitor their interest, foreign exchange risks, and changes infair values from time to time and any gains and losses are included in the income statement. The Group and Company do not utiliseforward contracts or other arrangements for trading or speculative purposes. At 31 December 2002 there were no such arrangements,interest rate swap contracts or other derivative instruments outstanding. The Group and Company are exposed to interest rate pricerisk for financial instruments with a fixed interest rate and to interest rate or cash flow risk for financial instruments with a floatinginterest rate that is reset as market rates change. The Group and Company are also exposed to changes in foreign exchange rates andliquidity of businesses.

3. RELATED COMPANIES

Related companies in these financial statements refer to subsidiaries of the Company.

4. CASH AND CASH EQUIVALENTSGroup Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Unrestricted 5,413 2,152 3,637 744Restricted (a) - 2,775 – 2,775

5,413 4,927 3,637 3,519

A N N U A L R E P O R T 2 0 0 2 35

(a) This is for fixed deposits pledged to a bank for credit facilities granted.

Analysis of above amount by foreign currency (‘000): Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

United States $ 2,171 1,933 1,960 1,875

5. MARKETABLE SECURITIESGroup Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Listed equity shares in corporations - at cost – 102 – –- at fair value 81 – – –

81 102 – –

Fair value at end of year 81 110 – –

The investments represent short-term investments in listed equity securities which provide an opportunity for return through dividendincome and trading gains. The fair values of these securities approximates to their market value.

6. TRADE RECEIVABLESGroup Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Outside parties 10,681 11,153 9,472 9,915Less: provision for doubtful debts (848) (250) (828) (231)

9,833 10,903 8,644 9,684

Movements in above provision:Balance at beginning of year 250 109 231 85Charge to income statement 598 141 597 146

Balance at end of year 848 250 828 231


A N N U A L R E P O R T 2 0 0 236


6. TRADE RECEIVABLES (Cont’d)

Analysis of above amount by foreign currency:Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

United States $ 5,197 5,080 5,133 5,044

Concentration of customers:Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Top 1 customer 3,236 4,867 3,236 4,867

The average credit period taken by customers is 44 days (2001 : 124 days). A provision is made for estimated irrecoverable amountsfrom the customers. This provision is determined by reference to past default experience. The directors consider that the carryingamount of trade receivables approximates to their fair value.

7. OTHER RECEIVABLES AND PREPAYMENTSGroup Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Subsidiaries (Note 3 and 9) – – 540 230Other receivables 30 52 13 5Prepayments 16 13 9 7

46 65 562 242

8. INVENTORIESGroup Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Finished goods at cost 662 586 644 565Raw materials carried at cost 1,925 2,740 1,803 2,617

2,587 3,326 2,447 3,182

A N N U A L R E P O R T 2 0 0 2 37

9. INVESTMENT IN SUBSIDIARIESCompany

2002 2001$’000 $’000

Unlisted equity shares at cost 2,877 2,877

Net book value of subsidiaries 3,403 3,016

Name of subsidiaries, country of incorporation, Cost in Effective percentage ofplace of operations and principal activities books of company equity held by group

2002 2001 2002 2001$’000 $’000 % %

Alpha Pacific Petroleum (S) Pte Ltd (a) 500 500 100 100SingaporeImporters, exporters and blending of lubricating oil and grease

A.I.M. Chemical Industries Pte Ltd (a) 2,377 2,377 100 100SingaporeToll-blending and manufacturing of speciality chemicals

AP Petrochemical Pte Ltd (a) (d) (d) 100 100SingaporeInvestment holding

2,877 2,877

Held through Alpha Pacific Petroleum (S) Pte Ltd

Alpha Pacific Petroleum Company Limited (b) – – 100 100United KingdomDormant

Held through AP Petrochemical Pte Ltd

AP Petrochemical (Vietnam) Co., Ltd (c) – – 80 –VietnamProduction processing, export and import of lubricantsand chemical products (plant under construction)


A N N U A L R E P O R T 2 0 0 238


9. INVESTMENT IN SUBSIDIARIES (Cont’d)

The Company also owns the business names of “Sino Petroleum”, “Krex International” and “Polaris Petrochemical”.

(a) Audited by Chio Lim & Associates

(b) The financial statements of this subsidiary is not required to be audited under the laws of United Kingdom and it is not material.

(c) Other auditors. Audited by firms of accountants other than member firms of Howarth International of which Chio Lim &Associates, Singapore is a member. The name of the auditors is Thuy Chung Auditing & Accounting Financial ConsultativeService Co., Ltd

(d) Cost of investment is less than $1,000.

10. OTHER INVESTMENTSGroup Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Listed equity shares in corporations at cost 8 11 8 11

Fair value at end of year 8 6 8 6

11. PROPERTY, PLANT AND EQUIPMENT

Group Leasehold Plant andproperties equipment Total

$’000 $’000 $’000

Cost:At beginning of year 5,186 5,454 10,640Additions 786 465 1,251Disposals - (255) (255)

At end of year 5,972 5,664 11,636

Accumulated depreciation:At beginning of year 2,965 4,500 7,465Charge for the year 272 451 723Disposals - (253) (253)

At end of year 3,237 4,698 7,935

Depreciation for last year 266 546 812

A N N U A L R E P O R T 2 0 0 2 39

11. PROPERTY, PLANT AND EQUIPMENT (Cont’d)

Group Leasehold Plant andproperties equipment Total

$’000 $’000 $’000

Net book value:At beginning of year 2,221 954 3,175

At end of year 2,735 966 3,701

Company Leasehold Plant andproperties equipment Total

$’000 $’000 $’000

Cost:At beginning of year 1,377 2,109 3,486Additions 23 152 175Disposals – (129) (129)

At end of year 1,400 2,132 3,532

Accumulated depreciation:At beginning of year 608 1,758 2,366Charge for the year 35 141 176Disposals – (129) (129)

At end of year 643 1,770 2,413

Depreciation for last year 34 178 212

Net book value:At beginning of year 769 351 1,120

At end of year 757 362 1,119

(i) The Group and Company’s leasehold properties are mortgaged for banking facilities as disclosed in Note 13.

(ii) A motor vehicle with a net book value of $45,666 (2001 : $91,331) is registered in the name of a director who holds the assetin trust for the Company.

(iii) Certain items are under hire purchase or finance lease agreements (see Note 17).

(iv) The following are properties held by the Group and Company at end of the year:-


A N N U A L R E P O R T 2 0 0 240


11. PROPERTY, PLANT AND EQUIPMENT (Cont’d)

Location of Tenure Gross land Gross Built-in Existingproperties of land area (sqm) area (sqm) use

No. 30 Gul Crescent A 30+30 year lease with 5,217 1,550 Manufacture ofJurong effect from 1 April 1981 lubricating oils and fluidsSingapore 629535

No. 18 Pioneer A 30-year lease with 8,426 1,837 Manufacture ofSector 1 effect from 1 February lubricating oils and fluidsSingapore 628428 1979 with an option to

extend another 10 years

No. 19 Tractor Road A 22-year-and-4-month 5,988 1,853 Toll-blend and manufacturerSingapore 627977 lease with effect from of chemicals and speciality

29 October 1985 chemicals

Ong Keo Industrial Park A 50 years lease with 63,239 - Construction in progress

Phuoc Khanh Ward effect from 16 NovemberNhon Trach District 2001Dong Nai Province

12. GOODWILL

Group

2002 2001$’000 $’000

Goodwill on acquisition of subsidiaries, at cost 502 502Accumulated amortisation (251) (151)

251 351

Movements in accumulated amortisation:Balance at beginning of year 151 50Charge to income statement 100 101

Balance at end of year 251 151

A N N U A L R E P O R T 2 0 0 2 41

13. SHORT-TERM BORROWINGS

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Bank overdrafts - 111 - 111Trust receipts and bills payable to banks - 1,811 - 1,811

- 1,922 - 1,922

The short-term borrowings are secured by the following:

(i) assignment and mortgage of the Company’s equity shares in a subsidiary;

(ii) first and legal mortgage of the Group’s leasehold properties; and

(iii) pledge of fixed deposits (Note 4).

The short-term borrowings bear interest of 2.8% to 4.8% (2001 : 3.9% to 5.1%) per annum.

The borrowings were fully repaid as at 31 December 2002.

14. TRADE PAYABLES AND ACCRUED LIABILITIES

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Subsidiary (Note 3 and 9) – – 32 26Outside parties and accrued liabilities 6,981 8,840 5,906 7,699

6,981 8,840 5,938 7,725

Analysis of above amount by foreign currency:Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

United States $ 2,513 3,230 2,447 3,408

The average credit period taken to settle payables is about 33 days.


A N N U A L R E P O R T 2 0 0 242


15. OTHER PAYABLES

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Rental deposits received 31 41 – –Other payables 31 – – –

62 41 – –

16. PROVISIONS

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Provision for product warranty: 203 207 – –

Movements in above provision:Balance at beginning of year 207 207 – –Used (4) – – –

Balance at end of year 203 207 – –

17. OBLIGATIONS UNDER FINANCE LEASES

Group Minimum Finance PresentPayments charges value

2002 $’000 $’000 $’000

Minimum lease payments payable:Due within one year 76 4 72Due within 2 to 5 years 37 2 35

Total 113 6 107

Net book value of plant and equipment under finance leases 154

It is the Group policy to lease certain of its plant and machinery under finance leases. The average lease term is 2 years. The rate ofinterest for finance leases is about 3% per year. Interest rates are fixed at the contract date. All lease are on a fixed repayment basis andno arrangements have been entered into for contingent rental payments. All lease obligations are denominated in S$. The fair value ofthe lease obligations approximates to their carrying amount. The obligations under finance leases are secured by the corporate guaranteefrom the Company.

A N N U A L R E P O R T 2 0 0 2 43

18. ISSUED CAPITAL

Group and Company

2002 2001$’000 $’000

Authorised1,000,000,000 ordinary shares of $0.05 each as at end of the year 50,000 50,000

Issued and fully paid87,750,000 ordinary shares of $0.05 each as at end of the year 4,388 4,388

19. REVENUE

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Sale of goods 74,841 32,787 70,945 28,592Rendering of services 1,649 1,809 – –

76,490 34,596 70,945 28,592

20. OTHER OPERATING INCOME

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Dividend income from unlisted subsidiary, gross – – 484 –Dividend income from listed corporation, gross 6 6 – –Interest income from non-related companies 65 56 63 43Rental and service income 197 272 – 3Other income 217 135 204 134

485 469 751 180


A N N U A L R E P O R T 2 0 0 244


21. OTHER CREDITS / (CHARGES)

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Bad debts written off – trade – (1) – (1)Cost of oil spilt (68) – (68) –Foreign exchange adjustment (loss)/gain (460) 171 (446) 165Gain on disposal of investment property – 404 – 404Gain on disposal of plant and equipment 54 5 28 4Government grant received – 14 – –Miscellaneous 40 16 – 16Provision for doubtful debts – trade (598) (141) (598) (146)Trademarks written-off (11) – (11) –Written down of investment in marketable securities (24) – (3) –

(1,067) 468 (1,098) 442

22. PROFIT FROM OPERATIONS

In addition to the charges and credit disclosed elsewhere in the notes to the financial statements, this item includes the following(charges)/credits:

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Auditors’ remuneration:- company’s auditors 34 29 24 20- other auditors 1 – – –

Other fees to auditors:- company’s auditors – – – –- other auditors – – – –

Directors’ fees 40 30 40 30Directors’ remuneration:

- directors of company 862 714 802 654- directors of subsidiaries 299 299 – –

Depreciation expense 723 812 176 212Changes in inventories of finished goods (76) (6) (79) (27)Raw materials and consumables used 65,749 26,926 62,950 23,580Amortisation of goodwill 100 101 – –Preliminary expenses written off – 12 – –

A N N U A L R E P O R T 2 0 0 2 45

23. FINANCE COSTS

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Interest expense to non-related companies 82 173 80 170

24. INCOME TAX EXPENSE

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Current 973 621 792 460Deferred (44) – – –

Total income tax expenses 929 621 792 460

The income tax expense varied from the amount of income tax expense determined by applying the Singapore income tax rate of 22%(2001 : 24.5%) to profit before income tax as a result of the following differences:

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Income tax expense at statutory rate 723 619 796 519Non-allowable items 251 60 11 9Exempt income (36) (39) (12) (13)Deferred tax assets not recognised – 36 – –Over provision of income tax in respect of prior years (6) (55) – (55)Other items (3) – (3) –

Total income tax expense 929 621 792 460


A N N U A L R E P O R T 2 0 0 246


24. INCOME TAX EXPENSE (Cont’d)

The net deferred tax amount in the balance sheet is as follows:

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Deferred tax liabilities:Excess of net book value of property, plant and equipment 206 302 173 173Foreign exchange adjustments 37 (15) – –

Total deferred tax liabilities 243 287 173 173

At the balance sheet date, the aggregate amount of temporary differences associated with investments in subsidiaries for whichdeferred tax liabilities have not been recognised is insignificant.

There are no income tax consequences of dividends to shareholders of the Company.

25. EARNINGS PER SHARE

The earnings per share is calculated by dividing the Group’s profit after taxation of $2,392,000 (2001 : $1,905,000) by the weightednumber of shares of $0.05 each in issue during the year which is 87,750,000 (2001 : 80,437,500).

26. DIVIDENDS

On 20 June 2002, a final dividend of 0.242 cents per ordinary shares less tax on the ordinary shares of the Company totalling $165,848in respect of the financial year ended 31 December 2001 was paid to shareholders.

During the year, an interim dividend of 0.20 cents less tax (2001 : NIL) cents per ordinary share was paid to shareholders.

In respect of the current year, the directors propose that a final dividend of 0.20 cents and a special dividend of 0.95 cents less tax pershare be paid to shareholders after the annual general meeting. This dividend is subject to approval by shareholders at the annualgeneral meeting and has not been included as a liability in these financial statements. The proposed dividend for 2002 is payable inrespect of all shares in issue at the date of these financial statements.

A N N U A L R E P O R T 2 0 0 2 47

27. CASH IN THE CASH FLOW STATEMENT

Group

2002 2001$’000 $’000

Cash and cash equivalents 5,413 4,927Bank overdraft – (111)

5,413 4,816

NON CASH TRANSACTIONS – Additions to plant and equipment during the year amounting to $156,000 (2001: NIL) were financed bynew finance leases.

28. STAFF COSTS

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Staff costs, excluding directors 1,764 1,676 885 801Contributions to defined contribution plan 192 195 88 87

Total staff costs 1,956 1,871 973 888

29. NUMBER OF EMPLOYEES

Group Company

2002 2001 2002 2001

Number of employees, excluding directors, at end of year 76 69 32 30

30. CAPITAL COMMITMENTS

The Group has committed USD1,200,000 (SGD2,080,800) to a joint venture company in Vietnam (“JVC”) over 3 years, starting fromyear 2002 as the Group’s share of equity contribution to the JVC. As at balance sheet date, the Group has contributed USD233,520(S$ 405,386) with a balance of USD966,480 (approximately S$1.7 million) to be contributed.


A N N U A L R E P O R T 2 0 0 248


31. OPERATING LEASE COMMITMENTS

The commitments in respect of operating leases with a term of more than one year are as follows:

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Within 1 year 286 282 66 66Within 2 to 5 years 1,143 1,070 265 202After next 5 years 2,812 2,490 2,536 2,248

Rental expense for the year 370 311 164 98

Operating lease payments represent rentals payable by the Group and Company for certain of its factory properties. The lease rentalterms are negotiated for a term of 3 to 30 years and rentals are subject to an escalation clause but the amount of the rent increase isnot to exceed a certain percentage. Such increases are not included in the above amounts.

32. CONTINGENT LIABILITIES

Group Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Bankers’ guarantees - Secured (Note 13) 639 1,237 639 1,232 - Unsecured 347 – 347 –

Letters of credit - Secured (Note 13) 103 7,298 103 6,063

Performance guarantee 5 – 5 –

Corporate guarantee issued for a subsidiary’s 145 500 145 500hire purchase/bank facilities

A N N U A L R E P O R T 2 0 0 2 49

33. DIRECTORS’ REMUNERATION

The number of directors in remuneration bands are as follows :

Group

2002 2001

$500,000 and above – –$250,000 to $499,999 1 1Below $250,000 5 5

Total 6 6

The service agreements between the respective directors and executive officers and the Company provided for a profit share of thepre-tax operating profits of the group. This amounted to $212,000 (2001: $58,000) for the financial year ended 2002.

34. ADOPTION OF ACCOUNTING STANDARDS

For the year ended 31 December 2002, the Group adopted the following new accounting standards for the first time:

SAS 12 Income Taxes (effective from 1 April 2000).

Revision to SAS 26 Consolidated Financial Statements and Accounting for Investments in Subsidiaries(effective from 1 July 2001).

SAS 34 Interim Financial Reporting (effective from 1 October 2001).

None of the above accounting standards required material modification of the measurement method or the presentation in thefinancial statements.

35. SEGMENTAL INFORMATION

The Group’s operating businesses are organised according to the nature of products and services provided. These are grouped intofour segments and formed the basis on which the Group reports its primary segment information. The manufacturing segmentmanufactures a range of lubricating oils and fluids and speciality chemicals for industrial, automotive and marine applications andprovides blending services to its customers. The trading segment trades in base oil and additives and speciality chemicals. The marinesegment supplies fuel oil to the ships and the franchising and outsourcing segment trades in base oil and additives using the Company’sbrand name.

Revenue and assets are attributed to geographical areas based on the location of the customers and assets respectively.

The following tables present the segment revenue and profit for the year and certain assets and liabilities information regardingsegments as at 31 December 2002 and 2001.


A N N U A L R E P O R T 2 0 0 250


35. SEGMENTAL INFORMATION (Cont’d)

Business Segments

Manufacturing Trading Marine

In thousands of S$ 2002 2001 2002 2001 2002 2001

Segment revenue

Sales to external customers 18,688 17,857 34,436 11,055 17,925 536

Total revenue 18,688 17,857 34,436 11,055 17,925 536

Segment result 4,678 4,128 3,053 1,252 268 10

Unallocated other operating income

Unallocated expenses

Profit from operations

Finance costs

Profit before income tax

Income tax expense

Net profit for the year

Segment assets 10,813 10,780 5,250 1,196 472 143

Unallocated assets

Total assets

Segment liabilities 1,883 737 2,526 290 1,388 138

Unallocated liabilities -- -- -- -- -- --

Total liabilities

Other business segment information

Capital expenditure 639 170 -- -- -- --

Depreciation 432 546 -- -- -- --

Amortisation -- -- -- -- -- --

A N N U A L R E P O R T 2 0 0 2 51


Franchising and

Outsourcing Others Consolidated

2002 2001 2002 2001 2002 2001

5,441 5,148 -- -- 76,490 34,596

5,441 5,148 -- -- 76,490 34,596

492 348 -- -- 8,491 5,738

485 469

(5,606) (3,508)

3,370 2,699

(82) (173)

3,288 2,526

(929) (621)

2,359 1,905

255 250 -- -- 16,790 12,369

5,130 10,491

21,920 22,860

-- -- -- -- 5,797 1,165

-- -- -- -- 2,967 11,104

8,764 12,269

-- -- 612 28 1,251 198

-- -- 291 266 723 812

-- -- 100 101 100 101

A N N U A L R E P O R T 2 0 0 252


35. SEGMENTAL INFORMATION (Cont’d)

Geographical segments

The Group’s sales are mainly to South East Asia, Indochina and East Asia and others. The Group’s manufacturing of lubricating oil is

carried out in Singapore.

The following table provides an analysis of the Group’s sales by geographical market, irrespective of the origin of the goods:

Sales revenue by

geographical market

2002 2001

$’000 $’000

South East Asia 30,313 15,110

Indochina and East Asia 39,158 10,485

Other 7,019 9,001

76,490 34,596

The following is an analysis of the carrying amount of segment assets, and additions to property, plant and equipment and intangible

assets, analysed by the geographical area in which the assets are located:-

Carrying amount of Additions to property,

segment assets plant and equipment

and intangible assets

Year ended Year ended

2002 2001 2002 2001

$’000 $’000 $’000 $’000

South East Asia 14,337 20,934 1,251 198

Indochina and East Asia 6,472 1,171 - -

Other 1,111 755 - -

21,920 22,860 1,251 198

A N N U A L R E P O R T 2 0 0 2 53

information on shareholdings


INFORMATION ON SHAREHOLDINGS AS AT 8 APRIL 2003

Authorised share capital : SGD 50,000,000

Issued and fully paid : SGD 4,387,500

Number of shares : 87,750,000

Class of shares : ordinary shares of SGD 0.05

Voting rights : one vote per share

DISTRIBUTION OF SHAREHOLDERS BY SIZE OF SHAREHOLDINGS AS AT 8 APRIL 2003

Size of Holdings No. of Holders % No. of Shares %

1 - 999 0 0.00 0 0.00

1,000 - 10,000 597 63.99 3,227,000 3.68

10,001 - 1,000,000 328 35.15 19,920,000 22.70

1,000,001 AND ABOVE 8 0.86 64,603,000 73.62

933 100.00 87,750,000 100.00

SHAREHOLDING HELD BY THE PUBLIC

Based on the information available to the Company as at 8 April 2003, approximately 33.33% of the issued ordinary shares of the Company is

held by the public and, therefore, Rule 723 of the Listing Manual issued by the Singapore Exchange Securities Trading Limited is compiled with.

SUBSTANTIAL SHAREHOLDERS

Name of shareholders Direct interest % of shares Deemed interest % of shares

No. of Shares No. of Shares

Dr Ho Leng Woon1 38,250,000 43.59 14,850,000 16.92

Lau Woon Chan 14,850,000 16.92 38,250,000 43.59

Lau Tong Hong2 4,505,000 5.135 -- --

Notes:

1) Dr Ho Leng Woon is the husband of Lau Woon Chan. They are deemed to be interested in the shares held by each other. Of the

38,250,000 shares in which Dr Ho Leng Woon has an interest, 8,000,000 shares are held through Hong Leong Finance Nominees Pte Ltd.

2) Ms Lau Tong Hong is the sister of Mdm Lau Woon Chan.

A N N U A L R E P O R T 2 0 0 254


LIST OF TOP TWENTY SHAREHOLDERS AS AT 8 APRIL 2003

S/N Name of Shareholder No. of Shares % of Shares

1 Ho Leng Woon, Dr 30,250,000 34.47

2 Lau Woon Chan 14,850,000 16.92

3 Hong Leong Finance Nominees Pte Ltd 8,080,000 9.21

4 Lau Tong Hong 4,500,000 5.13

5 Tan Kia Choo David 2,400,000 2.73

6 Ho Aye Eng 2,025,000 2.31

7 Koh Kwee Kee 1,330,000 1.52

8 United Overseas Bank Nominees Pte Ltd 1,168,000 1.33

9 Syn Chee Fong Elizabeth @ Tay Syn Chee Fong 950,000 1.08

10 Ker Boon Kee or Lee Mien Yong 837,000 0.95

11 Ang Luck Seh 755,000 0.86

12 DBS Nominees Pte Ltd 581,000 0.66

13 Ang Chian Poh 541,000 0.62

14 OCBC Securities Private Ltd 508,000 0.58

15 Yuen Keng Mun 490,000 0.56

16 Ho Kei Wen 481,000 0.55

17 Singapore Nominees Pte Ltd 426,000 0.49

18 Oversea-Chinese Bank Noms Pte Ltd 418,000 0.48

19 Yong Yuen Pun Michael 400,000 0.45

20 UOB Kay Hian Pte Ltd 363,000 0.41

TOTAL: 71,353,000 81.31

A N N U A L R E P O R T 2 0 0 2 55

notice of annual general meeting


To: All Shareholders

Dear Sirs,

NOTICE IS HEREBY GIVEN that the 2003 Annual General Meeting of the shareholders of the Company will be held on Monday, 12 May 2003

at 30 Gul Crescent Jurong Singapore 629535 at 2.30 p.m. to transact the following businesses :

AS ORDINARY BUSINESS

1. To receive the audited financial statements of the Company and the Reports of the Directors Resolution 1

and Auditors for the year ended 31 December 2002.

2. To declare a final dividend of 0.156 cents per ordinary share net of tax and a special dividend Resolution 2

of 0.741 cents per ordinary share net of tax for the year ended 31 December 2002.

3. To re-elect the following directors retiring pursuant to the Company’s Articles of Association :

Lau Woon Chan (Article 107) Resolution 3

Ong Sim Ho (Article 117) Resolution 4

[Note: Mr Ong Sim Ho is considered an independent Director and will, upon re-election as Director

of the Company, remain as Chairman of the Audit Committee and Nominating Committee and as

a member of the Remuneration Committee.]

4. To approve the Directors’ fees for the year ended 31 December 2002. Resolution 5

5. To re-appoint Chio Lim & Associates as the auditors for the ensuing year and to authorise the Directors to fix Resolution 6

their renumeration.

AS SPECIAL BUSINESS

To consider and, if thought fit, to pass the following Resolutions as Ordinary Resolutions,

with or without amendments:

6. “That pursuant to Section 161 of the Companies Act, Chapter. 50 and the Listing Manual of the Resolution 7

Singapore Exchange Securities Trading Limited, authority be and is hereby given to the Directors

to issue shares in the Company (whether by way of rights, bonus or otherwise) at any time and

upon such terms and conditions and for such purposes and to such persons as the Directors may

in their absolute discretion deem fit provided that the aggregate number of shares to be issued

pursuant to this Resolution does not exceed 50 per cent (50%) of the issued share capital of the

Company for the time being of which the aggregate number of shares to be issued other than on

a pro rata basis to shareholders of the Company does not exceed 20 per cent (20%) of the issued

share capital of the Company for the time being, and unless revoked or varied by the Company in

general meeting, such authority shall 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 the earlier.”

[See Explanatory Note (i)]

A N N U A L R E P O R T 2 0 0 256


7. And to transact any other business which may be properly transacted at an Annual General Meeting.

NOTICE IS ALSO HEREBY GIVEN that the Transfer Books and Register of Members of the Company will be closed on 23 May 2003 for the

purpose of determining shareholders’ entitlements to the proposed final dividend of 0.156 cents per ordinary share net of tax and a special

dividend of 0.741 cents per ordinary share net of tax in respect of the financial year ended 31 December 2002 (the “Proposed Dividends”).

Duly completed transfers received by the Company’s Registrars, Barbinder & Co Pte Ltd at 8 Cross Street #11-00 PWC Building Singapore 048424

up to 5.00 p.m. on 22 May 2003 will be registered before entitlements to the Proposed Dividends are determined. The Proposed Dividends, if

approved by shareholders at the 2002 Annual General Meeting, will be paid on 6 June 2003.

Members whose Securities Accounts with The Central Depository (Pte) Limited (“CDP”) are credited with shares at 5.00 p.m. on 22 May 2003

will be entitled to the Proposed Dividends.

In respect of shares in Securities Accounts with CDP, the said dividend will be paid by the Company to CDP which will in turn distribute the

dividend entitlements to such holders of shares in accordance with its practice.

BY ORDER OF THE BOARD

Lau Woon Chan

Tan Siok Kheng

Company Secretaries

Singapore

Date : 24 April 2003

Explanatory Note:

(i) The Ordinary Resolution proposed in item 6 above, if passed, will empower the Directors of the Company from the date of the above

meeting until the next Annual General Meeting to issue shares in the Company up to the limit as specified in the Resolution for such

purposes as they consider would be in the interests of the Company. This authority will continue in force until the next Annual General

Meeting of the Company, unless previously revoked or varied at a general meeting.

Note:

a) A member entitled to attend and vote at this meeting is entitled to appoint a proxy to attend and vote in his stead. A proxy need not

be a member of the Company.

b) If a proxy is to be appointed, the form must be deposited at the registered office of the Company at 30 Gul Crescent Jurong Singapore

629535 not less than 48 hours before the meeting.

c) The form of proxy must be signed by the appointor or his attorney duly authorised in writing.

d) In the case of joint shareholders, all holders must sign the form of proxy.

A N N U A L R E P O R T 2 0 0 2 57

proxy form

proxy form

I/We

of

being a member/members of AP OIL INTERNATIONAL LIMITED (the “Company”), hereby appoint

Total Number of Shares Held

IMPORTANT

1. For investors who have used their CPF monies to buy the Company’s shares, this AnnualReport is forwarded to them at the request of their CPF Approved Nominees and is sentsolely FOR INFORMATION ONLY.

2. The Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents andpurposes if used or purported to be used by them.

Name Address NRIC/Passport Number Proportion of Shareholdings

Name Address NRIC/Passport Number Proportion of Shareholdings

and/or (delete as appropriate)

as my/our proxy/proxies to attend and to vote for me/us on my/our behalf and, if necessary, to demand a poll at the 2003 Annual GeneralMeeting of the Company to be held at 30 Gul Crescent Jurong Singapore 629535 on Monday, 12 May 2003 at 2.30 p.m. and at any adjournmentthereof.

(Please indicate with an ‘X’ in the spaces provided whether you wish your vote(s) to be cast for or against the resolutions as set out in the noticeof Annual General Meeting. In the absence of specific directions, the proxy/proxies will vote or abstain as he/they may think fit, as he/they willon any other matter arising at the Annual General Meeting.)

No. Resolutions relating to For Against

1 Directors’ Report and Audited Accounts for the year ended 31 December 2002

2 Declaration of a final dividend of 0.156 cents per ordinary share net of tax anda special dividend of 0.741 cents per ordinary share net of tax for the yearended 31 December 2002

3 Re-election of Mdm Lau Woon Chan as Director

4 Re-election of Mr Ong Sim Ho as Director

5 Approval of Directors’ fees for the year ended 31 December 2002

6 Re-appointment of Chio Lim & Associates as Auditors

7 Authority to issue shares pursuant to Section 161 of the Companies Act, Cap. 50and the Listing Manual of the Singapore Exchange Securities Trading Limited

Dated this day of 2003.

Signature(s) of member(s)/Common Seal

IMPORTANT: PLEASE READ NOTES OVERLEAF

A N N U A L R E P O R T 2 0 0 258

proxy form

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), 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.

If no number is inserted, this form of proxy will 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 not more than two proxies

to attend and vote on his behalf. A proxy need not be a member of the Company.

3. Where a member appoints more than one proxy, he shall specific the proportion of his shareholding to be represented by each proxy.

4. The instrument appointing a proxy or proxies must be under the hand of the appointer or his 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 common seal or

under the hand of its attorney or duly authorised officer.

5. A corporation which is a member of the Company may authorise by resolution of its directors or other governing body such person as

it thinks fit to act as its representative at the Annual General Meeting, in accordance with its Articles of Association and Section 179 of

the Companies Act, Chapter 50.

6. The instrument appointing a proxy or proxies, together with the power of attorney or other authority (if any) under which it is signed,

or notarially certified copy thereof, must be deposited at the registered office of the Company at 30 Gul Crescent Jurong Singapore

629535 not later than 48 hours before the time set for the Annual General Meeting.

7. 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 members of the Company whose shares are entered against their

names in the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if such members are

not shown to have shares entered against their names in the Depository Register at 48 hours before the time appointed for holding the

Annual General Meeting as certified by The Central Depository (Pte) Limited to the Company.

Chairman’s Message 3

Operations Review 7

Board of Directors 9

Corporate Governance Statement 11

Group Financial Highlights 16

Financial Contents 17

Information on Shareholdings 53

Notice of Annual General Meeting 55

Proxy Form

Corporate Information inside back cover

contents

Company SecretariesMs Tan Siok Kheng, ACIS, LLB (Hons) (London)Ms Lau Woon Chan, BA (Nanyang)

Registered Office30 Gul CrescentJurongSingapore 629535Telephone (65) 6861 5503Facsimile (65) 6861 9162Email: [email protected]: www.aplube.com

RegistrarBarbinder & Co Pte Ltd8 Cross Street#11-00 PWC BuildingSingapore 048424

AuditorsChio Lim & AssociatesCertified Public Accountants18 Cross Street#09-01China Square CentralSingapore 048423

Principal BankersThe Development Bank of Singapore Ltd6 Shenton WayDBS Building Tower OneSingapore 068809

The Hongkong and Shanghai Banking Corporation Limited21 Collyer Quay #08-01HSBC BuildingSingapore 049320

Standard Chartered Bank6 Battery Road#07-00Singapore 049909

Bank of ChinaSingapore Branch4 Battery RoadBank of China BuildingSingapore 049908

corporate information

30 Gul Crescent, JurongSingapore 629535Telephone (65) 6861 5503Facsimile (65) 6861 9162Email: [email protected]: www.aplube.com

Alpha Pacific Petroleum (S) Pte Ltd

18 Pioneer Sector 1, JurongSingapore 628428Telephone (65) 6862 2765Facsimile (65) 6861 0259Email: [email protected]: www.aplube.com

A.I.M Chemical Industries Pte Ltd

19 Tractor Road, JurongSingapore 627977Telephone (65) 6265 4700Facsimile (65) 6266 5082Email: [email protected]: www.aimchem.com.sg

AP

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ANNUAL REPORT - 早报 · 2013. 5. 13. · #11-00 PWC Building Singapore 048424 Auditors Chio Lim & Associates Certified Public Accountants 18 Cross Street ... Vietnam the new plant