C O N T E N T S

Our Mission

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Corporate Data

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Our Products

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President’s Review

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Operations Review

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Board of Directors

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Key Management

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Financial Contents

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To be a leading OEM/ODM manufacturer in:

• data communication products

• personnal communication products

To be a one-stop design and contract

manufacturing service provider

Our Mission

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Corporate Data

CHAIRMAN/CEO

Michael Mun Hong Yew

DIRECTORS

Michael Mun Hong Yew

Patricia Ng Sok Cheng

Philip Tan Tee Yong

Colin Ng Teck Sim

Khoo Ho Tong

AUDIT COMMITTEE

Philip Tan Tee Yong (Chairman)

Colin Ng Teck Sim

Khoo Ho Tong

NOMINATING COMMITTEE

Colin Ng Teck Sim (Chairman)

Khoo Ho Tong

Michael Mun Hong Yew

REMUNERATION COMMITTEE

Khoo Ho Tong (Chairman)

Philip Tan Tee Yong

Patricia Ng Sok Cheng

COMPANY SECRETARIES

Pavani Nagarajah

Pradeep Kumar Singh

AUDITORS

Deloitte & Touche

6 Shenton Way, #32-00

DBS Building, Tower Two

Singapore 068809

Prakash Ambelal Desai

Partner-in-charge

Appointed May 22, 2002

REGISTRAR

B.A.C.S Pte Ltd

63 Cantonment Road

Singapore 089758

REGISTERED OFFICE

31 Ubi Road 1,

Aztech Building

Singapore 408694

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With strong design experience andtechnology focus in the Computerand Telecommunication industries,Aztech manufactures DSL modems,Analog modems, Wireless 802.11a/b/g, Powerline modems, DECTPhones and 2 Way Radios.

Our Products

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President’s Review

“We believe we will

succeed because we

have a business model

that is built on

synergies supporting

each other within a

culture that thrives on

innovation and which

embraces technology.”

A year ago I outlined Aztech’s commitment to turnaround and return toprofitability. Our commitment then was to build an efficient infrastructure withinthe Group’s production and business facilities that would improve ourperformance; our commitment was also to expand and improve on our product-mix with additional design and engineering expertise, and to deliver qualityproducts to a wide spectrum of customers through an aggressive marketingprogramme.

We have delivered on our promise and commitment for 2003. We consolidatedour manufacturing operations in China and relocated the operational supportfunctions to Hong Kong and China. Additionally, we expanded our sales andmarketing network for a wider global reach. As for the products, we extendedour product portfolio to data communication and personal communicationproducts.

The achievement of our objectives is reflected in the financial performance for2003. This solid foundation will position us for Aztech’s next stage of developmentand growth.

FINANCIAL REVIEW

Group profit after tax rose to $2.8 million, reversing a loss of $17.9 million theyear before. The gross profit margin improvement from 6.3% in 2002 to 15.2%in 2003 is due to the stringent measures we had taken to align costs to revenue.The Group concentrated on higher margin products and lowered manufacturingcost.

The consolidation of manufacturing in China and the relocation of supportservices to Hong Kong reduces costs all round as we are able to tap into a largermore economical supply base for raw materials and locate ourselves closer tothe suppliers. This reduces costs and improves turnaround time.

Group turnover fell by 26.7% to $118.0 million. The decline was caused by anoverall decline in the number of units sold which was a result of a weak economyand intense competition. However, the Group’s focus for the year was toconcentrate on product-mix with higher margin to improve the Group’s bottom-line. With our achievement on improving our gross margin, moving forward, wewill intensify our efforts to improve our turnover.

OUTLOOK

In 2003, the year had begun with heightened geopolitical tensions, weakeconomies and the unexpected outbreak of SARS. In contrast, this year the globaleconomies are showing healthy growth with the year ahead. Concurrently,industry analysts have almost unanimously supported the chorus of betterbusiness and trading conditions all around.

We are very confident that our reduced cost base and market-leading nicheproducts will provide a good opportunity for growth. The Group has continuedto maintain a strong cash position throughout 2003 which gave us the necessaryfinancial base to undertake expansion plans.

Our diversified product portfolio is continually being expanded. Our productofferings include several winning products that are in constant demand fromOEM/ODM customers. We continue to be a “quick-mover” in many productlines and bring them to market in a timely fashion in order to enhance the valueof the products and solutions to enterprises and consumers. We intend to expandour ADSL modems’ product line and introduce advanced models of DECT phones,

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President’s Review

2-way radios (PMR/FRS) and other cutting edge consumer electronic products. We will leverage on trade fairs such asthe CeBIT 2004 exhibition in Hanover, Germany and the Hong Kong Electronic Spring Fair to exhibit our new productsand create product awareness to potential customers.

We maintain leadership in the OEM/ODM division, capitalizing on the accelerating outsourcing trend. We have themanufacturing capabilities to meet the exacting standards demanded by our customers. We integrate our engineeringexpertise with our manufacturing processes to deliver a seamless supply chain to these international customers.Anticipating a higher level of orders for the OEM/ODM and EMS divisions, we will be expanding our productioncapacity in our Dong Guan, China plant by occupying 43,148 square metres of factory space, this expansion is expectedto be completed in February, 2005.

We have clearly defined goals. Building on the strength of our skilled management and employees, the strong financialposition and a global customer base, we enter 2004 with a clear focus, commitment and confidence. Our productioncapacity will be increased to meet the continual demand for our current offerings. We will concentrate our design anddevelopment on higher margin products with better yield. Geographically, we seek to expand our market share in theOEM/ODM market place with particular emphasis on tapping the European and American markets. Business developmentworldwide will be vamped up to tap the demand for consumer electronics such as ADSL modems, digital cordlessphones and 2-way radios.

I am pleased that 2003 proved to be a better year forthe Group leading the way to growth and expansion forus in the future. We made substantial progress in all ourareas of operations – marketing, manufacturing, R&Dand logistics. More importantly we have evolved tobecoming a new kind of Company – not just differentfrom the past but also differentiated from the rest in theindustry. Our sole objective is to drive Aztech to the toptier of electronics manufacturing companies.

We believe we will succeed because we have a business model that is built on synergies supporting each other withina culture that thrives on innovation and which embraces technology. We will break new ground in ODM of datacommunication and telecommunication product offerings and electronic manufacturing services, attracting customersto us because we are differentiating Aztech in more ways than one. We will constantly look for new business opportunitiesto find new ways to expand our market reach and increase our revenue.

First, we have solidified our reputation as a leader in innovative products that meet customers’ requirements and whichenable our customers to drive their own success.

Secondly, we have integrated manufacturing facilities that encompass the entire spectrum of electronics manufacturingservices and we will be one of the few companies that can build it all together on a global scale to deliver superlativeproducts, services and partnerships to customers.

Finally, we have global delivery capability with our strategically located network of offices and operations.

At Aztech, we believe we now have a real opportunity to extend on the progress we have made and increase ourleadership into the new world of pervasive telecommunications and information technology.

ACKNOWLEDGEMENT

Finally, we thank our customers, our business partners, our shareholders and our employees for their support as westrive to achieve a pattern of growth that we all can be proud of.

MICHAEL MUNPresident and CEO

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Operations Review

OVERVIEW

Established in 1986, Aztech Systems Ltd is a Singapore public listed company providing Electronic ManufacturingServices (EMS) and OEM/ODM design and manufacturing services. The Aztech Group’s headquarters is in Singaporewith offices in the USA, Germany, Malaysia, Hong Kong and China. The Hong Kong office is the main logisticssupport office where materials, purchasing, warehousing, sales, finance and management information systems arein place. The Group’s main manufacturing facilities are in China where we have two plants that can handle high-volume/low mix production as well as high-mix/low volume production. In addition, a new plant is slated for completionby end of February 2005 with a total built up area of 43,148 sq metres. This development is considered a majormilestone for Aztech with the significant groundbreaking ceremony having just taken place.

MANUFACTURING FACILITIES AND CAPABILITIES

Our manufacturing facilities are located mainly in China. We have invested in state-of- the-art manufacturing equipmentwith stringent quality control in design, raw materials handling, fabrication, assembly and packaging. Our plants inChina occupy a total of 21,602 sq metres of factory space with a production area of 12,550 sq metres. Well locatedin the industrial town of Dong Guan, China, there is a plentiful supply of skilled labour and many supporting industriesof other parts that are vital to our SMT manufacturing. Another advantage is that this factory has a 100% domesticsales license and gives us access to sell to the huge China market. In total we have more than 10 years of experiencein printed circuit board assembly and mechanical/final product assembly.

We are pleased to announce that Aztech’s manufacturingand logistics support functions were awarded the TL 9000and ISO9001:2000 Quality Management System awards bythe PSB Certification Pte. Ltd. The certifications were given inrecognition of the Company’s manufacturing capabilities inrouters, modems, PCB assemblies and Box build assemblies.Aztech’s administration, purchasing, IT and warehousingservices are also recognized under this certification. Thisaccolade further proves Aztech’s competitive advantage as aworld class provider of quality broadband products,manufactured and guided by TL9000 class qualitymanagement system.

Furthermore in China there are essentially two plants currently which are ISO 9002 certified. There is vertical integrationof plastic injection and moulding section that processes thermoplastic resins to produce high quality plastic parts.The plastic injection plant has 19 plastic injection machines and offers the complete service including injectionmoulding, spray painting, silkscreen and EMC coating. It also provides secondary services such as industrial design,mechanical design and tooling production management. As such, there is seamless production of products underone roof and this forms part of our cost containment strategies, as we do not rely on a third party.

The other plant is an electronic manufacturing plant, which is capable of SMT placement and micro BGA. This planthas production lines, which have precision equipment such as chip mounters, IC placers, MPM screen printer and X-Ray inspection equipment.

With these facilities we offer a whole range of manufacturing service, including surface mount placement, throughhole insertion, in circuit testing and functional tests, electro-mechanical assembly and Box build, plastic injectionmoulding, quality engineering, turnkey procurement and material management, prototype and mass production,worldwide logistics service and post sales services (RMA services).

Dong Guan Factory. Groundbreaking ceremony for newplant in Dong Guan.

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Operations Review

Complementing our manufacturing capabilities, we have a complete procurement and material managementservice. We are able to handle all active and passive components and with worldwide connections we sourcefor our customers the products they need at the lowest price, the highest quality and the most technologicallyadvanced.

With a full ERP system supported by Oracle, we are able to track the entire supply chain to meet the tightproduction schedules provided by our customers. The “just in time” orders of our customers are fulfilled withour efficient and fully integrated procurement and material management capabilities.

RESEARCH & DEVELOPMENT

Supporting our ISO 9002 certified manufacturing plants, are the Group’s considerable research and development(R&D) capabilities that include several test laboratories for products such as 56K modem, Broadband / ADSL,802.11x Wireless LAN, PMR/FRS/GMRS and DECT Phone. We also have EMS shield room for compliance andproduct assurance laboratories for product testing of various products. With these facilities we are able toprovide our OEM/ODM customers with the relevant product customisation to ensure that the products producedby us meet the required standards of the target market.

Our R&D capabilities is a vertically integrated operation, including Circuit Design, Printed Circuits Board Design,Firmware/Software and GHz radio frequency designs and diverse and complementary skill sets that coverIndustrial Design and Mechanical Design. We aim to drive down product costs and shorten development andengineering cycle through our dedicated R&D resources. With two R&D centres in Singapore and Shenzhen,China, we are able to transfer technology and shorten the commercialisation cycle of our products.

There are three key trends which define our R&D direction. These are, in no particular order, Convergence,Mobility and Consumer Design. These trends signify and determine the product portfolio, ID design and featuresof our current and future products.

Other specific R&D initiatives taken in 2003 include substantial improvements to our industrial design, wirelessdesign and real-time embedded operating systems. Taken together, we have made significant progress in ourability to offer intelligent and aesthetically appealing designs for our customers as well as enhancing thetechnical competencies of our products.

BUSINESS SEGMENTS

The Group’s primary focus in moving forward would be on data communications and networking, personalcommunications, audio/visual products and consumer electronics devices. In a world enhanced by more andmore computer related electronics, telecommunications devices, wireless applications and handheld gadgetry,we see remarkable growth opportunities for the deployment and capture of these market opportunities. Wenow offer a wide range of data communications and personal communication products which we manufactureon OEM and ODM basis. These products are targeted to form the backbone of our future success.

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Additionally, operating in an industry that places a premium on fast turnaround and exceptional product reliability,we are proud of our commitment to engineering and manufacturing excellence. While precedents may exist onother genres of what we do, we believe that our range is wide and our capabilities powerful – all manufactured andtested at our state-of-the-art ISO certified world class manufacturing facilities in China.

With the telecommunications and IT industries making a robust rebound in response to the global economy’sturnaround, we are optimistic this will boost demand for our variety of products.

OEM/ODM BUSINESS

Turnover for the data-communication segment came mainly from the production and sale of OEM/ODM productsdesigned for the personal computer and telecommunications industry. Supported by strong R&D capabilities, theGroup’s products include the full range of analog modems, broadband ADSL modems and Wireless LAN products.Our ADSL modem has been a leading product for Aztech’s OEM division and to keep abreast of consumer trends,new and upgraded models have been introduced to the market. Industry sources state ADSL is fast evolving into amainstream residential broadband access technology. This growth of 77.8% meant that the total number of DSLsubscribers around the world reached 63.84 million by end of the year 2003, according to figures prepared byindustry analyst firm, Point Topic for the international DSL Forum. As for our 56K modem, it remains a popularcomponent of the PC bundle and hence forms a stable product for Aztech. In addition our range broadband ofrouters, wireless lan, power line products and VOIP products make up the wide range of product offerings.

Aztech is a leading supplier for DECT Phone. We have a full range of design and manufacturing capabilities. In 2004,we will expand our product offering in personal communications product category to include 2 way radios (PMR/FRS/GMRS) and home digital cordless phone systems or more specifically a wireless networking standard calledDigital Enhanced Cordless Telecommunications (DECT). As a DECT phone maker, Aztech will continue to keep addingfeatures such as clock radio, weather station and SMS to our range of DECT phones and making technology upgradesto cater to its gaining popularity. There are several choices of DECT phones with varying functions for differentmarkets. Another new product, Aztech’s 2-way radio which was presented at CeBIT in Germany is making its markas a personal communication product. There is growing interest in this product stemming from the current popularityof wireless communication gadgets and Aztech can expect growth in our personal communication products sector.We are participating in major trade show such as CeBIT and Hong Kong Electronics Trade fair to create awareness inour products.

With our varied product mix, our aim is to generate better margins and deliver a steady flow of orders. In addition,our ability to identify market trends and design and manufacture the corresponding products is essential to ourOEM/ODM division.

We are also exploring and developing high end products such as Set Top Box, VOIP products, Home gateways,Bluetooth handsets and Bluetooth car kits. These product launches will depend on market requirements. We expectour customers to demand for these new products when the market trend for them picks up.

Overall, we are positive on the outlook for our OEM/ODM division, as we have been able to secure customers thatare leading companies in their respective countries, which seek high quality, good price, exceptional performanceand latest products with strong R&D. We also have a dedicated customer program team assigned to every customerto cater to their requirements for quality, timely delivery and cost target.

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Operations Review

EMS

We have provided OEM and ODM services to some of the top-tiers in the electronics industry. Our customers arefrom the main countries that outsource their production, namely, US, Europe and Asia Pacific.

With our state-of-the-art facilities in China, we provide a complete turnkey service with worldwide logistics supportand post sale services to our customers. Our technical capabilities include surface mount placement, through holeinsertion, plastic mould injections, electron mechanical assembly, Box build and prototype /mass production.

Our plans for 2004 in this segment include the expansion of production facilities with additional machinery such aschip on board (COB). The EMS segment is expected to not only widen its product range but also its market reach asit penetrates other countries that have yet to give us significant orders.

Industry observations on the trend for outsourcing by major brand name companies indicate that whether it is cellphones, base stations, game consoles, PCs, PDAs or printers – these companies are all looking for a total manufacturingpackage. We believe we have the capability to provide a total outsourcing solutions package that will appeal tothese brand name companies who can focus on their core strengths - which is design and marketing of theirproducts.

Consequently, with our new production facilities, we will be well positioned to capture the opportunities as theyarise and cater to the increasing demand.

DISTRIBUTION

One of Aztech’s business expansion strategies is to establish a worldwide distribution network to enable fasterproduct roll out into the market and achieve greater growth, hence the establishment of Shiro, a fully ownedsubsidiary. This demonstrates Aztech’s commitment to developing enterprises that will complement our core businessand create more growth opportunities.

Shiro’s objective is to create “Shiro” as a household brand focusing on the computer peripherals andtelecommunications products such as Digital Camera, MP3 Player, Monitor, Optical Mouse, Hard Disk Enclosure,Flash Drive, USB Hub Port and Data Communications and Connectivity products to name a few. Our mission is todeliver the best designed products under one brand to the mass markets. More importantly it is to make productsmore affordable to consumers.

Offering a diverse and far-reaching product mix of computer peripherals and telecommunications products, Shiroproducts are high in performance, quality and style, enhancing our consumers’ lives now and in the future. With ourstrong and rich product offerings, consistent quality and affordable pricing, our distributors can enjoy higher salesgrowth and profitability.

Board of Directors

Mr Michael Mun Hong Yew

Is one of the co-founders of

Aztech. He was appointed as

President and CEO of Aztech

Systems Ltd since 1986. Mr Mun

honed his managerial and entre-

preneurial skills early in his

working career with the Singapore

office of a British consumer

electronics distributor. He is

currently a Director of UOB

Venture Investments (II) Ltd. He

was a Board Member of the

National Science and Technology

Board from 11 January 1995 to 10

January 1999.

Ms Patricia Ng Sok Cheng

Is an Executive Director of Aztech

Systems Ltd and was appointed in

1993. She is also the Senior Vice

President of the Company. Ms Ng’s

experience includes developing

business for OEM/ODM products,

contract manufacturing services,

distribution and retail sector. She

also has experience in materials

management and product develop-

ment. She currently holds the post

of General Manager of the

Company’s wholly-owned subsidi-

ary, Shiro Corporation Pte Ltd. She

also holds directorships in some of

Aztech’s subsidiaries. Ms Ng has

been with Aztech since 1986.

Mr Philip Tan Tee Yong

Is an Independent Director appointed

in 1993. He was re-elected to the

Board in 2002. Mr Tan is the owner

and Managing Director of PTMC

Outsourcing Pte. Ltd. A Fellow of the

Chartered Institute of Management

Accountants, he has 38 years of

experience in banking, accounting,

finance, marketing and sales, com-

mercial & banking software develop-

ment, consulting, manufacturing and

entrepreneurship. Having worked in

MNC and local companies, he is

familiar with the two different

management styles. He has also

assisted in 3 IPOs and a Rights Issue.

Mr Tan was a Member of Parliament

for 2 terms aggregating 7 years.

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Board of Directors

Mr Khoo Ho Tong

Is an Independent Director of

Aztech Systems Ltd. He has been

practicing as a Public Accountant for

over 20 years. Mr Khoo is also

involved in a number of professional

associations. He is a treasurer,

council member and member of

various sub-committees of the

Institute of Certified Public Account-

ants, Singapore. He is also a

member of the Public Accountants

Board and the Treasurer of the

Asean Federation Accountants. His

other posts include being an

Independent Director and non-

executive Director of various listed

companies. Mr Khoo is a Certified

Public Accountant in Singapore.

Mr Colin Ng Teck Sim

An Independent Director of Aztech

Systems Ltd, is a practising lawyer

with over 20 years of experience. His

practice focuses on corporate

banking and finance including

public listings of companies and also

on securities and capital market

instruments. He has also advised on

a number of public listings for

companies in and outside of

Singapore. Mr Ng was educated at

the National University of Singapore

and admitted as advocate & solicitor

in the Supreme Court of Singapore

in 1982. He was also admitted in

2000 as solicitor in the Supreme

Court of England and Wales. He is

also a Notary Public and Commis-

sioner of Oaths and a member of

the Singapore Stock Exchange Ltd’s

Appeals Committee.

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Key Management

DR HASSAN FARHANGI (AGE 49) Chief Technical Officer

Dr Hassan Farhangi, joined Aztech in 2002 as the Company’s Chief Technical Officer and is responsible

for the Group’s Research and Development activities. Dr Hassan previously served Aztech as Acting

VP of Aztech R&D and later as General Manager of a subsidiary of Aztech between 1994 and 1997.

From 1997 to 1998, he was appointed as Vice President of Design Services for Cadence Design

Systems, Milpitas California and later from 1998 to 2002, he was appointed as Professor of

Information Technology at The Technical University of British Columbia in Vancouver, Canada. Dr

Hassan holds a Ph.D in Electronics Engineering from University of Manchester, UK.

MARTIN CHIA HEOK MIIN (AGE 42) Vice President, Sales and Marketing

Mr Martin Chia joined Aztech in 1989. He is currently a Vice President in the Marketing and Sales

Division of the Group and is responsible for product marketing and sales activities. Prior to joining

Aztech, Mr Chia was a marketing executive in a multinational sales company dealing in semiconductor

and computer peripherals. He holds a Diploma in Electronics and Communication Engineering from

the Singapore Polytechnic.

TONY TAN HUI KIAT (AGE 42) General Manager, Group Manufacturing Operations

Mr Tony Tan joined Aztech in 1992. He is currently the General Manager of Aztech Communication

Device (DG) Ltd. Mr Tan is responsible for overseeing the Group’s factory operations in Dong Guan,

China. Prior to joining Aztech, Mr Tan was appointed as a Production Manager by a local manufacturer

of computer peripherals. He graduated from Singapore Polytechnic with a Diploma in Electronics &

Communication Engineering and subsequently obtained a Diploma in Industrial Management from

Singapore Polytechnic.

CHEN HSIEN-FU a.k.a TONY TAN (AGE 37) Director, Research and Development

Mr Chen joined Aztech in 1991. He is currently the Director of Research and Development and is

responsible for overseeing the Group’s R&D centre in Singapore. His main portfolio includes planning,

coordination, and execution of product design and development within R&D. He is also responsible

for technical support of Aztech ODM products. Prior to the above, he was the Product Marketing

Manager for Data Communications products in Aztech. He started his career as a Technical Support

Engineer in a multinational corporation dealing in computer systems and peripherals. He graduated

with a Bachelor of Science in Computer Engineering.