World’s Largest - topglove.com · PAGE PAGE PAGE 1 Export Markets 2 Corporate Vision and Mission 3 Contents 4 Corporate Structure 7 International Quality Awards and Certifications

Incorporated in Malaysia ( Company No. : 474423-X )A Public Company Listed on the Main Market of Bursa Malaysia and Main Board of Singapore Exchange

ANNUALREPORT

FINANCIAL YEAR ENDED 2018

31 AUGUST 2018

TheWorld’sLargest Manufacturer

of Gloves

THE WORLD IS OUR MARKET

EXPORTS TO 195

COUNTRIES WORLDWIDE

NORTH AMERICA

1. CANADA2. USA

LATIN AMERICA

3. ANGUILLA 4. ANTIGUA AND

BARBUDA5. ARGENTINA 6. ARUBA 7. BAHAMAS 8. BARBADOS 9. BELIZE

10. BOLIVIA 11. BRAZIL 12. BRITISH VIRGIN

ISLANDS13. CAYMAN ISLANDS14. CHILE15. COLOMBIA16. COSTA RICA17. DOMINICA18. DOMINICAN

REPUBLIC19. ECUADOR20. EL SALVADOR21. GRENADA22. GUADELOUPE23. GUATEMALA24. GUYANA

NORTH AMERICA

LATIN AMERICA

25. HAITI26. HONDURAS27. JAMAICA28. MARTINIQUE29. MEXICO30. MONTSERRAT31. NETHERLANDS

ANTILLES32. NICARAGUA33. PANAMA34. PARAGUAY35. PERU36. PUERTO RICO37. SAINT BARTHELEMY38. SAINT KITTS

AND NEVIS39. SAINT LUCIA40. SAINT MARTIN41. SAINT VINCENT

AND GRENADINES42. SURINAME43. TRINIDAD &

TOBAGO44. TURKS AND

CAICOS45. U.S. VIRGIN

ISLANDS46. URUGUAY47. VENEZUELA

EUROPE

48. ALBANIA49. ANDORRA50. AUSTRIA51. BELGIUM52. BOSNIA

HERZEGOVINA53. BULGARIA54. CROATIA55. CZECH REPUBLIC56. DENMARK57. ESTONIA58. FINLAND59. FRANCE60. GERMANY61. GREECE62. HUNGARY63. ICELAND64. IRELAND65. ITALY66. KOSOVO67. LATVIA68. LIECHTENSTEIN69. LITHUANIA70. LUXEMBOURG71. MACEDONIA, FYR72. MALTA73. MOLDOVA74. MONACO75. MONTENEGRO76. NETHERLANDS

77. NORWAY78. POLAND79. PORTUGAL80. ROMANIA81. RUSSIA82. SAN MARINO83. SERBIA84. SLOVAKIA85. SLOVENIA86. SPAIN87. SWEDEN88. SWITZERLAND89. UNITED KINGDOM

AFRICA

90. ALGERIA91. ANGOLA92. BENIN93. BOTSWANA94. BURKINA FASO95. BURUNDI96. CAMEROON97. CAPE VERDE98. CHAD99. COMOROS

100. REPUBLIC OF THECONGO

101. DJIBOUTI 102. EGYPT 103. EQUATORIAL

GUINEA

OCEANIA

ASIA

MALAYSIA

EUROPE

AFRICA

104. ETHIOPIA 105. ERITREA 106. GABON 107. GAMBIA 108. GHANA 109. GUINEA 110. GUINEA-BISSAU 111. KENYA 112. LESOTHO 113. LIBERIA 114. MADAGASCAR 115. MALAWI 116. MALI 117. MAURITANIA 118. MAURITIUS 119. MOROCCO 120. MOZAMBIQUE 121. NAMIBIA 122. NIGER 123. NIGERIA 124. RWANDA 125. SAO TOME AND

PRINCIPE 126. SENEGAL 127. SEYCHELLES 128. SIERRA LEONE 129. SOUTH AFRICA 130. SWAZILAND 131. TANZANIA 132. TOGO 133. TUNISIA

134. UGANDA 135. ZAMBIA

ASIA

136. AFGHANISTAN 137. ARMENIA 138. AZERBAIJAN 139. BAHRAIN 140. BANGLADESH 141. BHUTAN 142. BRUNEI 143. CAMBODIA 144. CHINA 145. CYPRUS 146. EAST TIMOR 147. GEORGIA 148. HONG KONG 149. INDIA 150. INDONESIA 151. ISRAEL 152. JAPAN 153. JORDAN 154. KAZAKHSTAN 155. KUWAIT 156. KYRGYZSTAN 157. LAOS 158. MACAU 159. MALAYSIA 160. MALDIVES 161. MONGOLIA

162. NEPAL 163. OMAN 164. PAKISTAN 165. PALESTINE 166. PHILIPPINES 167. QATAR 168. SAUDI ARABIA 169. SINGAPORE 170. SOUTH KOREA 171. SRI LANKA 172. TAIWAN 173. TAJIKISTAN 174. THAILAND 175. TURKEY 176. TURKMENISTAN 177. UAE 178. UZBEKISTAN 179. VIETNAM

OCEANIA

180. AMERICAN SAMOA 181. AUSTRALIA 182. FIJI 183. GUAM 184. KIRIBATI 185. MARSHALL

ISLANDS 186. MICRONESIA 187. NAURU 188. NEW CALEDONIA

189. NEW ZEALAND 190. PALAU 191. PAPUA NEW

GUINEA 192. SAMOA 193. SOLOMON

ISLANDS 194. TONGA 195. VANUATU

TOP GLOVE CORPORATION BHD ANNUAL REPORT 2018 1

MISSION To be a world class glove manufacturer by providing top quality products with excellent services through continuous improvement and innovation.

QUALITY POLICY • Quality and productivity

are our business• Continuous improvement

and innovation are ourduties

• Towards zero defects isour target

• Compliance withcustomers’ and regulatoryrequirements is ourresponsibility

BUSINESS RULES• Do not lose our

shareholders’ money• Do not lose our health• Do not lose our temper• Do not lose our customers

BUSINESS ETHICS• Honesty• Integrity• Transparency

CORPORATE VALUES • Respect• Integrity• Value• Empowerment• Relationship

VISION We strive to be the world’s leading manufacturer with excellent quality glove products and services that enrich and protect human lives.

TAN SRI DR LIM WEE CHAIExecutive Chairman Top Glove Corporation Bhd

CORPORATE VISION AND MISSION

2 TOP GLOVE CORPORATION BHD ANNUAL REPORT 2018

PAGE PAGE PAGE

1 Export Markets 2 Corporate Vision and

Mission 3 Contents 4 Corporate Structure 7 International

Quality Awards and Certifications

8 Corporate Information 9 Board of Directors 10ProfileofDirectors 18 Senior Management

Team 19ProfileofKeySenior

Management 22 Financial Highlights 23 6-Year Financial Review

24 Enhancing Shareholders’Value

25 Letter to Stakeholders and Management Discussion & Analysis (English, BM & Mandarin)

48 Sustainability Statement

60 Financial Calendar 61 Top Glove Corporate

Song 62 Corporate Governance

Overview Statement 86 Statement on Risk

Management and Internal Control

89 Audit Committee Report

93Directors’Responsibility Statement

94 Financial Statements forthefinancialyearended 31 August 2018

187 List of Properties 201 Analysis of

Shareholdings 204 Notice of the

20th Annual General Meeting

211 Administrative Details for the 20th AGM

213 Form of Proxy215 Media Highlights216 Corporate Directory

CONTENTS

USA GERMANY

BRAZIL

THAILAND

SINGAPORE

MALAYSIA

CHINA

INDONESIA

TOP GLOVE’S GLOBAL OFFICES


TOP GLOVE CORPORATION BHD(Malaysia)(Listed on the Main Marketof Bursa Malaysia &Main Board ofSingapore Exchange)

100% TOP GLOVE SDN BHD (Malaysia)

100% EASTERN PRESS SDN BHD (Malaysia)

100% GMP MEDICARE SDN BHD (Malaysia)

100% GREAT GLOVE SDN BHD (Malaysia)

100% TG MEDICAL (U.S.A.), INC (USA)

100% TOP GLOVE ENGINEERING SDN BHD (Malaysia)

100% TOP GLOVE GLOBAL SDN BHD (Malaysia)

100% TOP GLOVE LABUAN LTD (Labuan)

100% TOP QUALITY GLOVE SDN BHD (Malaysia)

TOP GLOVE FOUNDATION* (Malaysia)

100% TOP FEEL SDN BHD (Malaysia)

100% TG MEDICAL SDN BHD (Malaysia)

100% TOP CARE SDN BHD (Malaysia)

100% FLEXITECH SDN BHD (Malaysia)

70% TG FMT SDN BHD (Malaysia)

100% TG PORCELAIN SDN BHD (Malaysia)

75% TGGD MEDICAL CLINIC SDN BHD (Malaysia)

100% TOP GLOVE CHEMICALS SDN BHD (Malaysia)

100% TOP GLOVE INTERNATIONAL SDN BHD (Malaysia)

100% TOP GLOVE PROPERTIES SDN BHD (Malaysia)

27% VALUE ADD SDN BHD (Malaysia)

100% MEDI-FLEX PTE LTD (Singapore)

97.5% TOP GLOVE EUROPE GMBH (Germany)

100% GREAT GLOVE (XINGHUA) CO LTD (China)

100% TG MEDICAL SUZHOU CO LTD (China)

100% BESTSTAR ENTERPRISE LTD (BVI)

100% B TECH INDUSTRY CO LTD (Thailand)

74% GREAT GLOVE (THAILAND) CO LTD (Thailand)

100% TOP GLOVE MEDICAL (THAILAND) CO LTD (Thailand)

100% TOP GLOVE TECHNOLOGY (THAILAND) CO LTD (Thailand)

100% TOP QUALITY GLOVES (THAILAND) CO LTD (Thailand)

CORPORATE STRUCTURE

85% DURAMEDICAL SDN BHD (Malaysia)

100% TOP HEALTHY FITNESS SDN BHD (Malaysia)

100% ASPION SDN BHD (Malaysia)

100% BEST ADVANCE RESOURCES LIMITED (Labuan)

100% GREEN RESOURCES LIMITED (Labuan)


Notes:1. Top Glove has in total 51

companies within the group.2. * Top Glove Foundation is a

member of Top Glove Group.

100% TG MEDICAL (PUTIAN) CO LTD (China)

100% TG MEDICAL (XINGHUA) CO LTD (China)

100% ADVENTA HEALTH SDN BHD (Malaysia)

100% CYTOTEC (M) SDN BHD (Malaysia)

100% SENTIENX SDN BHD (Malaysia)

100% SUIZZE HEALTH LTD (Hong Kong)

100% TERANG NUSA SDN BHD (Malaysia)

100% ULMA INTERNATIONAL GMBH (Germany)

100% TERANG NUSA (MALAYSIA) SDN BHD (Malaysia)

95.2% PURNABINA SDN BHD (Malaysia)

100% BEIJING ADVENTA HEALTH SUPPLIES CO LTD (China)

100%KEVENOLL DO BRASIL (Brazil)

2%

95% PT. AGRO PRATAMA SEJAHTERA (Indonesia)

PT. TOPGLOVE INDONESIA (Indonesia)

99.9%

0.1%

5TOP GLOVE CORPORATION BHD ANNUAL REPORT 2018

AIMING HIGHAt 27 years of age, Top Glove is a vibrant and dynamic company, with ambitious goals of becoming a Bursa Malaysia Top 20 company by 2020 and Fortune Global 500 company by 2040.

Our dreams may be big, but our resolve is strong. We believe that as we strategically expand our operations and penetrate new markets, we will be well able to achieve all we aspire to.

INTERNATIONAL QUALITY AWARDSAND CERTIFICATIONS

GRC Wickham Awards 2017 Technology Commercialization Awardby Global Rubber Conference (GRC)

The Edge Billion Ringgit Club 2017 Highest growth in profit after tax over three years (Silver)by The Edge

Winner: Healthiest Employeesby AIA Vitality 2017

MCBC Business Excellence Awards 2017(Category: World Market Leader)by Malaysia Canada Business Council

Gold Recipient- Large Catagory 2017FMM Excellence Award 2017by Federation of Malaysia Manufacturers

Winner: Manufacturing - Chemicals & Heavy Industriesby Malaysia’s 100 Leading Graduate Employers 2017, GTI Media

Certificate of ExcellenceHuman Resource Development Awards 2017by HRDF Malaysia

Asia Pacific Entrepreneurship Awards 2017 Lifetime Achievement Awardby Enterprise Asia

Most Innovative Award 2018Export Excellence Award 2018by Malaysian Rubber Export Promotion Council (MREPC)

Winner of Malaysia’s Best Companies to Work For in Asia 2018 by HR Asia

International Iconic Brand 2018 by The BrandLaureate Awards

Nanyang Superb Brand Award 2018(Category: Glove Innovation)by Nanyang Siang Pau

MSWG - Asean Corporate Governance Award 2016 (Categories: Merit Award for Most Improved & Industry Excellence - Manufacturing)by MSWG

Malaysian Fujian Exemplary Leader Award 2017by The Federation of Hokkien Associations of Malaysia (FHAM)

FTSE4Good Bursa Malaysia Index

FTSE4Good Bursa Malaysia Index

Winner of Malaysia’s Best Companies to Work For in Asia 2017 by HR Asia

MSWG - Asean Corporate Governance Award 2017(Categories: Merit Award for Most Improved Corporate Governance Disclosure & Industry Excellence for Manufacturing)by MSWG

NEW LEVELS OF EXCELLENCE2018


CORPORATE INFORMATION

BOARD OF DIRECTORS1. Tan Sri Dr Lim Wee Chai Executive Chairman2. Tan Sri Dato’ Seri Utama Arshad Bin Ayub Senior Independent Non-Executive Director3. Tan Sri Rainer Althoff Independent Non-Executive Director4. Dato’ Lee Kim Meow Managing Director5. Puan Sri Tong Siew Bee Executive Director6. Lim Hooi Sin Executive Director7. Lim Cheong Guan Executive Director8. Dato’ Lim Han Boon Independent Non-Executive Director9. Datuk Noripah Binti Kamso Independent Non-Executive Director10. Sharmila Sekarajasekaran Independent Non-Executive Director11. Tay Seong Chee, Simon Independent Non-Executive Director12. Datuk Dr. Norma Mansor Independent Non-Executive Director

REGISTERED & CORPORATE OFFICE

Level 21, Top Glove Tower, 16, Persiaran Setia Dagang,Setia Alam, Seksyen U13,40170 Shah Alam,Selangor D.E., Malaysia.Tel. : +603-3362 3098Fax : +603-3362 3860E-mails :(i) [email protected](ii) [email protected](iii) [email protected](iv) [email protected] : www.topglove.com

SENIOR INDEPENDENTNON-EXECUTIVE DIRECTOR

Tan Sri Dato’ Seri Utama Arshad Bin AyubTel. : +603-3362 3098E-mail :[email protected]

CHARTERED SECRETARIES

Chua Siew Chuan(MAICSA No.: 0777689)

Chin Mun Yee(MAICSA No.: 7019243)

Lim Keat See(MAICSA No.: 7020290)Tel. : +603-3362 3098E-mail : [email protected]

STOCK EXCHANGE LISTING

Main Market of Bursa MalaysiaSecurities BerhadStock Code : 7113Stock Name : TOPGLOVListing Date : 27 March 2001

Main Board of Singapore ExchangeStock Code : BVAStock Name : Top GloveListing Date : 28 June 2016

ADR Programme(Depository Receipt Programme) USAADR Symbol : TGLVY

REGISTRAR IN MALAYSIA

Securities Services (Holdings)Sdn BhdLevel 7, Menara Milenium,Jalan Damanlela,Pusat Bandar Damansara,Damansara Heights,50490 Kuala Lumpur, Malaysia.Tel. : +603-2084 9000Fax : +603-2094 9940/

+603-2095 0292E-mail : [email protected]

SHARE TRANSFER AGENT IN SINGAPORE

Boardroom Corporate & AdvisoryServices Pte Ltd50 Raffles Place,#32-01 Singapore Land Tower,Singapore 048623.Tel. : +65-6536 5355Fax : +65-6438 8710Email : [email protected]

AUDITORS

Ernst & YoungChartered AccountantsLevel 23A, Menara Milenium,Jalan Damanlela,Pusat Bandar Damansara,50490 Kuala Lumpur, Malaysia.

PRINCIPAL BANKERS

• Bank of Tokyo-Mitsubishi UFJ(Malaysia) Berhad

• BNP Paribas Malaysia Berhad• CIMB Bank Berhad• Citibank Berhad• Deutsche Bank (Malaysia)

Berhad• Hong Leong Bank Berhad• HSBC Bank Malaysia Berhad• Industrial and Commercial

Bank of China (Malaysia)Berhad

• Malayan Banking Berhad• Mizuho Bank (Malaysia) Berhad• OCBC Bank (Malaysia) Berhad• Public Bank Berhad• Siam Commercial Bank Public

Company Limited• Standard Chartered Bank

Malaysia Berhad• Sumitomo Mitsui Banking

Corporation Malaysia Berhad• The Bank of Nova Scotia

Berhad• United Overseas Bank

(Malaysia) Berhad


BOARD OF DIRECTORS

1 TAN SRI DR LIM WEE CHAI

2 PUAN SRI TONG SIEW BEE

3 DATO’ LEE KIM MEOW

4 TAN SRI RAINER ALTHOFF

5 LIM CHEONG GUAN

6 LIM HOOI SIN

7 TAN SRI DATO’ SERI UTAMA ARSHAD BIN AYUB

8 DATUK NORIPAH BINTI KAMSO

9 DATUK DR. NORMA MANSOR

10 SHARMILA SEKARAJASEKARAN

11 TAY SEONG CHEE, SIMON

12 DATO’ LIM HAN BOON

OUR BUSINESS DIRECTION IS:TO PRODUCE CONSISTENTLY HIGH QUALITY GLOVES AT EFFICIENT LOW COST

12 11 10 9 8 7 1 2 3 4 5 6


TAN SRI DR LIM WEE CHAI EXECUTIVE CHAIRMAN

PROFILE OF DIRECTORS

Nationality/ Age : Malaysian/ 60Gender : MaleDate of Appointment : 4 September 2000 (Founder)Length of Service : 18 years 3 months(as at 14 November 2018)Date of Last Re-election : 5 January 2017Board Committees : • Chairman of Investment Committee(as at 14 November 2018) • Chairman of ESOS Option Committee

• Chairman of Employees’ Share Grant Plan CommitteeBoard meetings attended : 7/7in the Financial YearQualification(s) : • Honorary Doctorate in Entrepreneurship from Management & Science University, Malaysia

• Honorary Doctorate in Business Administration from Oklahoma City University, UnitedStates of America

• Doctor of Philosophy in Management from University of Selangor, Malaysia• Master of Business Administration from Sul Ross State University, Texas, United

States of America• Bachelor of Science Degree with Honours in Physics from University of Malaya, Malaysia

Present Directorship(s) : Listed entity : Tropicana Corporation Berhad Other public company : Trustee of Top Glove Foundation

Present Appointment(s) : • Honorary President of the Associated Chinese Chambers of Commerce and Industry since 2017

• Life Honorary President of the Federation of Hokkien Associations of Malaysia since 2017• Honorary President of the Kuala Lumpur and Selangor Chinese Chamber of

Commerce and Industry since 2017• Director and Board Member of the Employees Provident Fund since 2015• Honorary President of the Malaysia-China Chamber of Commerce since 2012• Life Honorary Advisor of the Federation of Chinese Association Malaysia since 2011• Honorary Advisor of the Klang Chinese Chamber of Commerce since 2011• Honorary Advisor of the Lim Association of Malaysia since 2011• Director of Kuen Cheng High School since 2008

Past Appointment and : Tan Sri Dr Lim has been actively involved in many associations and organisations inWorking Experience Malaysia. He is the immediate Past President of the Federation of Malaysian Manufacturers

(FMM), having been in office in 2016/17. He served as the Director and Board Member of University of Malaya from 2015 to 2018, Council Member of the East Asia Business Council (EABC) from 2011 to 2015, and Director of the Association of Malaysia Medical Industries (AMMI). In addition, he was also the President of the Malaysian Rubber Glove Manufacturers’ Association (MARGMA) from 1997 to 1999. Prior to that, he served as Vice-President, Honorary Secretary and Treasurer of MARGMA for seven years.

Family Relationship with : Spouse of Puan Sri Tong Siew Bee and the brother of Mr. Lim Hooi Sin, both any Director(s) and/or are the Directors and Substantial Shareholders of the Company. He is also theSubstantial Shareholder(s) father of Mr. Lim Jin Feng, a Substantial Shareholder of the Company.of the Company


TAN SRI DATO’ SERI UTAMA ARSHAD BIN AYUB SENIOR INDEPENDENT NON-EXECUTIVE DIRECTOR

Nationality/ Age : Malaysian/ 90Gender : MaleDate of Appointment : 4 September 2000

(Re-designated as Senior Independent Non-Executive Director on 12 May 2017)Length of Service : 18 years 3 months(as at 14 November 2018) Date of Last : 9 January 2018Re-appointment Board Committees : • Chairman of Audit Committee(as at 14 November 2018) • Chairman of Nomination and Remuneration Committee

• Member of Investment CommitteeBoard meetings attended : 6/7in the Financial YearQualification(s) : • Postgraduate Diploma in Business Administration from Management Development

Institute (IMEDE) (Now IMD), Lausanne, Switzerland • Bachelor of Science (Hons) Economics and Statistics from University College of

Wales, Aberystwyth, United Kingdom• Diploma in Agriculture from College of Agriculture, Serdang, Malaysia

Present Directorship(s) : Listed entities :• Chairman of Malayan Flour Mills Bhd • Chairman of Tomypak Holdings Berhad • Chairman of Karex Berhad

Other public company : NilPresent Appointment(s) : • Pro Chancellor of Universiti Teknologi Mara (UiTM)

• Chancellor of KPJ International University College of Nursing & Health Sciences• Chancellor of INTI International University• Governor of Tuanku Ja’afar College

Past Appointment and : • President of the Malaysian Rubber Products Manufacturers Association (MRPMA)Working Experience • Chairman of Malaysian Rubber Export Promotion Council (MREPC)

• Member of the Malaysian Rubber Board (MRB)• Chairman of Board of Directors of University of Malaya Had a distinguished career in the Malaysian Civil Service, had held various senior positions in various Ministries in the Malaysian Government from 1958 to 1983, including serving as Economic Officer Penang and Deputy Controller Industrial Development Division of the then Ministry of Trade and Industry, Deputy Governor of Bank Negara Malaysia (1975 to 1977), Deputy Director General in the Economics Planning Unit of the Prime Minister’s Department (1977 to 1978) and as Secretary General in the Ministry of Primary Industries (1978), Ministry of Agriculture (1979 to 1981) and Ministry of Land and Regional Development (1981 to 1983). Tan Sri Arshad was a Member of Justice Harun’s Salaries Commission for statutory bodies and local government.

PROFILE OF DIRECTORS(CONT’D)


Nationality/ Age : Malaysian/ 59Gender : MaleDate of Appointment : 15 October 2003Date of Re-designated : 7 April 2009as Managing DirectorLength of Service : 15 years 1 month(as at 14 November 2018)

Date of Last Re-election : 6 January 2016Board Committees : Member of Risk Management Committee(as at 14 November 2018)

Board meetings attended : 7/7in the Financial YearQualification(s) : • Bachelor of Law Degree from University of London, United Kingdom

• Bachelor of Commerce Degree from University of New South Wales, Australiamajoring in Accounting, Finance and Information System

Present Directorship(s) : Listed entity : Nil Other public company : Trustee of Top Glove Foundation

Present Appointment(s) : • Chairman of the Asean Rubber Glove Manufacturers Association (ARGMA) since 2013

• Trustee of MARGMA Foundation since 2015• Board member of the Malaysian Rubber Export Promotion Council (MREPC)

since April 2018

Past Appointment and : Dato’ Lee has more than 15 years of experience in financial services, trading and Working Experience manufacturing business having worked in established financial institutions and with

a well-known conglomerate with diversified interest in the ASEAN region.

In the past 16 years, Dato’ Lee has been actively contributing to the development of the rubber glove industry in Malaysia as well as the ASEAN region. He has served for 14 years as a board member of the Malaysian Rubber Export Promotion Council (MREPC) from 2002 to 2016. He was a board member of the Malaysian Rubber Board (MRB) and the Tun Abdul Razak Research Centre (TARRC) from 2010 to 2011; and a past President of the Malaysian Rubber Glove Manufacturers’ Association (MARGMA). He was also the Chairman of the Organising Committee of the International Rubber Glove Conference and Exhibition (IRGCE) from 2014 to 2016.

DATO’ LEE KIM MEOW MANAGING DIRECTOR



Nationality/ Age : Malaysia Permanent Resident/ 72Gender : MaleDate of Appointment : 14 March 2013Length of Service : 5 years 8 months(as at 14 November 2018)

Date of Last : 9 January 2018Re-appointment Board Committees : Member of Risk Management Committee(as at 14 November 2018)

Board meetings attended : 7/7in the Financial YearQualification(s) : Master degree (Diploma) in Electronics and Electrical Engineering from Bergische

University of Wuppertal, GermanyPresent Directorship(s) : Listed entity : Nil

Other public company : Trustee of Jeffrey Cheah Foundation

Present Appointment(s) : • Member of Rotary Club Kuala Lumpur DiRaja since 2001• Chief Executive Officer of ALC International Sdn. Bhd., Kuala Lumpur since 2009• Member of International Advisory Panel to the Board of Directors of CIMB Bank

since 2009• Executive Director of Lauda Interactive AG, Darmstadt/ Germany since 2015• (Non-Administrative) Chairman of The Brand Laureate Foundation, Petaling Jaya

since 2016• Executive Chairman of RaceRoom Sdn. Bhd., Kuala Lumpur since 2017• Senior Advisor to T-Systems Malaysia Sdn Bhd, Cyberjaya since 2017

Past Appointment and : Has experiences in the fields of Electrical Engineering and Electronics which spans for Working Experience more than 45 years. Tan Sri Rainer Althoff was the President and CEO of Siemens

Malaysia Sdn Bhd, Petaling Jaya for more than 11 years and also the spokesperson of Siemens for all Siemens operations and its affiliated companies in Malaysia. He was a Non-Executive Director of Proton Holdings Berhad, Subang Jaya for 3.5 years and also the Chairman of Nokia Siemens Networks Sdn Bhd, Kuala Lumpur and Chairman of Coriant Malaysia Sdn. Bhd., Kuala Lumpur.

TAN SRI RAINER ALTHOFF INDEPENDENT NON-EXECUTIVE DIRECTOR



Nationality/ Age : Malaysian/ 60

Gender : Female

Date of Appointment : 4 September 2000 (Co-Founder)

Length of Service : 18 years 3 months(as at 14 November 2018)

Date of Last Re-election : 6 January 2016

Board Committees : Nil(as at 14 November 2018)

Board meetings attended : 6/7in the Financial Year

Qualification(s) : • Master of Business Administration from Sul Ross State

University, Texas, United States of America• Bachelor of Science Degree with Honours in Computer

Science from University of Science, Malaysia

Present Directorship(s) : • Listed entity : Nil• Other public company :

Trustee of Yayasan Pendidikan Tzu Chi Malaysia

Present Appointment(s) : Nil

Past Appointment and Working Experience: Worked in the banking industry in the information technology field for more than ten (10) years, she was formerly attached to United Overseas Bank Berhad and Utama Bank Berhad.

Family Relationship with any Director(s) and/or Substantial Shareholder(s) of the Company: Spouse of Tan Sri Dr Lim Wee Chai and sister-in-law of Mr. Lim Hooi Sin, both are the Directors and Substantial Shareholders of the Company. She is also the mother of Mr. Lim Jin Feng, a Substantial Shareholder of the Company.

PUAN SRI TONG SIEW BEEEXECUTIVE DIRECTOR


Gender : Male

Date of Appointment : 4 September 2000


Date of Last Re-election : 6 January 2016Board Committees : Nil(as at 14 November 2018)


Qualification(s) :

• Charter Financial Consultant Diploma from AmericanCollege, PA, United States of America

• Master Degree in Business Administration (Specialised inApplied Statistics) from Arizona State University, UnitedStates of America

• Bachelor of Science Degree in Management Science fromOklahoma State University, United States of America

Present Directorship(s) : • Listed entity : Nil• Other public company : Nil

Present Appointment(s) : Nil

Past Appointment and Working Experience: Mr. Lim spent fourteen (14) years of his career with MetLife Financial Services, one of the largest insurance and financial services company in the USA. Prior to this appointment, he was a Management Trainee, Associate Branch Manager, Regional Marketing Specialist, Agency Director and a Director of Asian Market. His experiences include product development, marketing, recruiting, training and supervision of a large highly productive sales force. He was previously a Director of AAAA (Arizona Asian American Association). He has more than 20 years of experience in the USA glove market, having been the founder of TG Medical USA, Inc. (a wholly-owned subsidiary of the company) in 1994, and served as its Executive Vice President from 2001 to 2005 and President since 2005. He also sits on the Board of several private limited companies.

Family Relationship with any Director(s) and/or Substantial Shareholder(s) of the Company: Brother of Tan Sri Dr Lim Wee Chai and brother-in-law of Puan Sri Tong Siew Bee, both are Directors and Substantial Shareholders of the Company.

LIM HOOI SINEXECUTIVE DIRECTOR




Gender : Male

Date of Appointment : 31 August 2006



Board Committees (as at 14 November 2018) :• Member of Risk Management Committee• Member of Investment Committee• Member of ESOS Option Committee• Member of Employees’ Share Grant Plan Committee


Qualification(s) :• Member of Malaysian Institute of Accountants• Member of Malaysian Institute of Certified Public

Accountants• Bachelor Degree in Accounting, University of Malaya,

Malaysia


Present Appointment(s) :• Advisor to the Management Committee of Top Glove

Foundation since year 2008• Chairman of the Risk Working Committee since year 2014

Past Appointment and Working Experience : Began his career with Price Waterhouse in 1990 and subsequently held various key positions in a number of public listed companies in Malaysia whose business activities spanned over manufacturing, plantation, trading and property development.


Gender : Male

Date of Appointment : 21 February 2011



Board Committees (as at 14 November 2018) :• Chairman of Risk Management Committee• Member of Audit Committee• Member of Nomination and Remuneration Committee• Member of Investment Committee• Member of ESOS Option Committee• Member of Employees’ Share Grant Plan Committee


Qualification(s) : • Master of Business Administration Degree from the

University of South Australia, Australia• Fellow of the Association of Chartered Certified

Accountants, United Kingdom• Chartered Accountant of the Malaysian Institute of

Accountants• Member of the Chartered Management Institute,

United Kingdom• Attended the Harvard Business School Senior

Management Development Program


Present Appointment(s) :• Independent Non-Executive Director of OCC Cables

Limited, listed in Hong Kong Stock Exchange• Founder/ Director of Envo BPO Services Sdn Bhd• Advisor to Outsourcing Malaysia, a Chapter of PIKOM,

the National ICT Association• Board Member of Kuen Cheng High School Kuala Lumpur

Past Appointment and Working Experience : Dato’ Lim started his career in the Chartered Accounting firm of Binder Hamlyn (now known as BDO). Subsequently, Dato’ Lim spent more than twenty (20) years in the transportation and maritime logistics industry having worked for Kontena Nasional Berhad, Northport (Malaysia) Berhad as its General Manager, Corporate Services and NCB Holdings Berhad as the Group Financial Controller and Company Secretary.

He is also no stranger in the Global Business Services/Outsourcing Industry having spent more than ten (10) years in this line, being the founder of Envo BPO Services Sdn Bhd.

LIM CHEONG GUANEXECUTIVE DIRECTOR

DATO’ LIM HAN BOONINDEPENDENT NON-EXECUTIVE DIRECTOR



DATUK NORIPAH BINTI KAMSOINDEPENDENT NON-EXECUTIVE DIRECTOR

SHARMILA SEKARAJASEKARANINDEPENDENT NON-EXECUTIVE DIRECTOR


Gender : Female

Date of Appointment : 18 March 2015

Length of Service : 3 year 8 months(as at 14 November 2018)


Board Committees (as at 14 November 2018) : • Member of Nomination and Remuneration Committee• Member of Audit Committee• Member of ESOS Option Committee• Member of Employees’ Share Grant Plan Committee


Qualification(s) : • Barrister-At-Law, Middle Temple, United Kingdom• Advocate & Solicitor, High Court of Malaya, Malaysia• B.A. Law & Economics (Hons.), Keele University, United

Kingdom• Adjudicator, Kuala Lumpur Regional Centre for Arbitration

Present Directorship(s) :• Listed entity : Nil• Other public company : Nil

Present Appointment(s) :• Consultant in the Legal, Operations and Industry

Development Departments of the RIM Group• Partner of Jerald Gomez & Associates since 2011, areas

of practice are Intellectual Property, Banking Litigation,Corporate Advisory and Family & Estate Claims

Past Appointment and Working Experience: Began her career as legal assistant in year 1998 with Messrs. Chooi & Co., and joined Messrs. Tay & Partners as Senior Legal Assistant in the Intellectual Property Department in 2000.She joined the RIM Group in year 2005 and held various positions in the RIM Group.


Gender : Female

Date of Appointment : 18 March 2015

Length of Service : 3 year 8 months(as at 14 November 2018)


Board Committees (as at 14 November 2018) : • Member of Audit Committee• Member of Investment Committee• Member of ESOS Option Committee• Member of Employees’ Share Grant Plan Committee


Qualification(s) : • Master in Business Administration, Marshall University,

Huntington, West Virginia, United States of America• Bachelor of Science, Northern Illinois University, Dekalb,

Illinois, United States of America• Diploma in Business Studies, Institute Technology Mara,

Malaysia

Present Directorship(s) : • Listed entity : Nil• Other public company :

Director of BIMB Investment Management Berhad

Present Appointment(s) : • Chairman of the Islamic Finance Council, Malaysia US

Chamber of Commerce, Washington DC• Member of Securities Industry Dispute Resolution Center,

Appeal Committee

Past Appointment and Working Experience: Began her career as Development Officer, Project Division with Urban Development Authority (“UDA”) from 1980 to 1983 and joined Bank of Commerce (M) Berhad as Senior Corporate Banker from 1983 to 1986. She joined the CIMB group since year 1993 to 2014 and held various key positions in CIMB Group.She was the Chief Executive Officer of CIMB Futures Sdn. Bhd. from 1996 to 2012, the Chief Executive Officer of CIMB Principal Asset Management Berhad from 2005 to 2013 and the founding Chief Executive Officer of CIMB Principal Islamic Asset Management Sdn. Bhd. from 2008 to 2012. Since 2008, she has successfully established a global platform for the firm to extend its reach to UK, Europe, GCC, Asia, USA and Australia. Datuk Noripah Kamso was a former Advisor of CIMB Islamic from 2013 to 2014. She was also the Past President of the Malaysian Futures Brokers Association (MFBA). She was formerly a Global Practitioner in Residence in Principal Financial Group Centre for Global Citizenship, USA in 2015. In the academic year 2016/17, she was a Fellow in Islamic Finance in Oxford Centre for Islamic Studies (OCIS), an independent college of the University of Oxford, United Kingdom.



Note : Save as disclosed, all other Directors have no family relationship with any Director(s) and/or Substantial Shareholder(s) of the Company, have no conflict of interest with the Company, have not been convicted of any offence within the past 5 years other than traffic offences, if any, and have no public sanction or penalty imposed by the relevant regulatory bodies during the financial year.


Gender : Female

Date of Appointment : 12 May 2017

Length of Service : 1 year 6 months(as at 14 November 2018)Date of Last Re-election : 9 January 2018

Board Committees (as at 14 November 2018 ) : • Member of Risk Management Committee• Member of Nomination and Remuneration Committee• Member of ESOS Option Committee• Member of Employees’ Share Grant Plan CommitteeBoard meetings attended : 7/7 in the Financial Year Qualification(s) : • Doctor of Philosophy (Ph.D.) from University of Liverpool• Master of Public Administration (MPA) from University of

Liverpool • Bachelor of Economics (Honours) Degree from University

of Malaya Present Directorship(s) : • Listed entity : Nil• Other public company : NilPresent Appointment(s) :• Director of Social Security Research Centre of University

of Malaya• President of Malaysian Economic AssociationPast Appointment and Working Experience : Datuk Norma started her career as a lecturer at the Department of Administrative Studies & Politics at University of Malaya in 1985. She was promoted as Associate Professor in 1992 and as Head of Department & Professor in 2000. She holds the position as an Executive Director of International Institute of Public Policy and Management from 2001 to 2004 and was subsequently appointed as Dean of the Faculty of Economics and Administration from 2004 to 2009. Her past appointment includes the Ragnar Nurkse Visiting Professor of the School of Innovation and Governance, Talinn University of Technology, Estonia in 2015; seconded to the Prime Minister’s Department as Secretary to the National Economic Advisory Council (NEAC) from 2009 to 2011. Datuk Norma’s main research interests are associated with topics relating to Social Protection, Ageing, Public Policy, Development and Governance. She has published eight books and more than hundred academic journal articles, book chapters and media articles; and she has spoken in more than 80 conferences and events.

Nationality/ Age : Singaporean/ 57Gender : MaleDate of Appointment : 15 June 2016Length of Service : 2 Year 5 months(as at 14 November 2018)Date of Last Re-election : 5 January 2017Board Committees : Nil(as at 14 November 2018)Board meetings attended : 7/7 in the Financial Year Qualification(s) :• Bachelor of Laws, LLB (Honours) from the National University

of Singapore• Masters in Law, LLM from Harvard Law SchoolPresent Directorship(s) : • Listed entity : Nil• Other public company : NilPresent Appointment(s) : • Advocate and solicitor of the Supreme Court of Singapore• Chairman, Singapore Institute of International Affairs• Associate Professor, Faculty of Law, National University

of Singapore• Senior Consultant, WongPartnership• Global Advisory Board Member, Mitsubishi UFJ Financial

Group of Japan• Independent & Non-Executive Director, LGT Bank

(Singapore) Ltd• Independent & Non-Executive Director, Far East

Organisation• Independent Director, Hyflux Ltd. (publicly listed on the SGX)• Commissioner, PT Oasis Waters InternationalPast Appointment and Working Experience : His previous corporate appointments include the Toyota Motor Corporation Global Advisory Board (2010 to 2015), as a Corporate Advisor to Temasek Holdings (2006 to 2009) and Independent Director of Eurex Clearing Asia Pte Ltd (a subsidiary of the Deutsche Bourse). He has spoken at leading business conferences including the World Economic Forum, APEC CEO Summits and SIBOS, and briefed major corporate boards and financial institutions about the politics and economics that matter to businesses. From 1992 to 2008, he served in a number of public appointments for Singapore. These included serving as Chairman of the National Environment Agency, a major government agency with over 3,000 civil servants, reporting to the Minister (2002 to 2008); an independent Member of Parliament (1997 to 2001); and to coordinate the Singapore Volunteers Overseas, the country’s equivalent of the Peace Corps (1990 to 1993). He was Chair or Co-Chair for a number of public commissions such as Singapore 21, the Singapore Green Plan and the Singapore Concept Plan 2010. In 2006, Prof Tay received a National Day Award. He continues to serve Singapore in a number of roles including as an Expert and Eminent Person in the ASEAN Regional Forum, a member of the government’s Climate Change Network and as Vice-Chairman of the Asia Pacific Water Forum.

DATUK DR. NORMA MANSORINDEPENDENT NON-EXECUTIVE DIRECTOR

TAY SEONG CHEE, SIMONINDEPENDENT NON-EXECUTIVE DIRECTOR



SENIOR MANAGEMENT TEAM2N

D ROW

3RD R

OW

2nd row (left to right)

Hue Kon FahWong Chong BanDato ̓Ir Haji AhmadThomas PetermoellerNoraziah MahmudJeremy LiewLew Sin ChiangEric Hoo Saw HoAaron LamRavi A/L Supramaniam Chookiad UsahaLeong Chew Mun

Puon Tuck SengOng Ah ChyeLee Shin HwaiTan Chee HoongTan Kian GuanDorothy ResselLim Hwa ChuanApple LauThomas BuriMichelle AngCalvin Ng Ng Yong Lin

Ngian Yoke FungNoor Akilah SaidinWilawan SakulsongboonsiriMansor Bin DaudLoke Kean MunSee Sook FongWendy YeohLoo Sun NooiChang Chee KeongPhattaraporn FueangthongTan Lee SemNg Seow Wei

Seah Chong ShewLooi Guat KianChen Chew LanAileen ChohChan Siew LanEdwyn PoonSiah Ming LeiMichelle VoonCheong Yan TattLim Jin FengKassy Lim

3rd row (left to right) 4th row (left to right) 5th row (left to right)

Lim Hooi Sin Puan Sri Tong Siew Bee Tan Sri Dr Lim Wee Chai Dato’ Lee Kim Meow Lim Cheong Guan


4TH R

OW5T

H ROW

The Management team is headed by the Executive Chairman, Tan Sri Dr Lim Wee Chai and Managing Director, Dato’ Lee Kim Meow. They are assisted by the Executive Directors, Puan Sri Tong Siew Bee, Mr. Lim Hooi Sin and Mr. Lim Cheong Guan; and the following key senior management team:

Qualification(s) :1. Bachelor of Arts (Hons) Economics2. Diploma of the Plastics and Rubber Institute

Malaysia3. Member of Malaysian Institute of ManagementExperience :More than 37 years of experience in the electronic, plastic and glove manufacturing industry.

Qualification(s) :1. Bachelor of Science, Mechanical Engineering

(UK England)2. Master Degree in Marine Technology

(UK England)Experience :Total 48 years of working experience in the Royal Malaysia Police (PDRM) and qualified as Professional Engineer P.Eng of Malaysia.

HUE KON FAHExecutive Director (Subsidiary Company), ManufacturingNationality : MalaysianAge/ Gender : 61/ MaleDate of appointment : 9 January 2003

Qualification(s) :Bachelor of Science, ChemistryExperience :More than 20 years of experience in the glove manufacturing industry.

WONG CHONG BANExecutive Director (Subsidiary Company), ManufacturingNationality : MalaysianAge/ Gender : 46/ MaleDate of appointment : 9 March 1998

Qualification(s) :Bachelor Degree of Management Systems (Hons)Experience :More than 24 years of experience in the field of marketing.

NORAZIAH MAHMUDSenior General Manager, MarketingNationality : MalaysianAge/ Gender : 49/ FemaleDate of appointment : 13 December 1993

DATO’ IR HAJI AHMAD B. HASSANAdvisor, Govt. Affairs, Project &SecurityNationality : MalaysianAge/ Gender : 71/ MaleDate of appointment : 3 September 2009

Qualification(s) :Bachelor of Science, Industrial ChemistryExperience :More than 20 years of experience in the glove manufacturing industry.

Mr. Lew is the brother-in-law of both Tan Sri Dr Lim Wee Chai and Puan Sri Tong Siew Bee.

LEW SIN CHIANGSenior General Manager, ManufacturingNationality : MalaysianAge/ Gender : 45/ MaleDate of appointment : 16 March 1998

PROFILE OF KEY SENIOR MANAGEMENT


Notes:

Save as disclosed above, none of the key senior management has:

(a) any directorship in public companies and listed issuers;(b) any family relationship with any directors and/or major shareholders of the Company;(c) any conflict of interest with the Company;(d) any conviction for offences (other than traffic offences) within the past five (5) years; and(e) any public sanction or penalty imposed by the relevant regulatory bodies during the financial year.

Qualification(s) :1. Certificate in Material Engineering2. Diploma in Material EngineeringExperience :More than 19 years of experience in the field of marketing.

Qualification(s) :Bachelor Degree of Finance & AccountingExperience :More than 32 years of experience in the field of accounting and finance.

Qualification(s) :Bachelor of Science, Mechanical EngineeringExperience :More than 30 years of experience in the field of manufacturing.

Qualification(s) :1. Bachelor of Science, Electrical Engineering2. Diploma in Management3. Member, Institution of Engineers MalaysiaExperience :More than 35 years of experience in various manufacturing environment.

AARON LAM YAT HINGSenior General Manager, MarketingNationality : MalaysianAge/ Gender : 52/ MaleDate of appointment : 17 January 2011

JEREMY LIEW SAY KEONGSenior General Manager, FinanceNationality : MalaysianAge/ Gender : 59/ MaleDate of appointment : 3 May 2005

CHOOKIAD USAHASenior General Manager, ManufacturingNationality : MalaysianAge/ Gender : 59/ MaleDate of appointment : 1 November 2003

RAVI A/L SUPRAMANIAMGeneral Manager, ManufacturingNationality : MalaysianAge/ Gender : 53/ MaleDate of appointment : 11 January 2006

PROFILE OF KEY SENIOR MANAGEMENT(CONT’D)


INTENSIFYING OUR FOCUS ON R&D, AUTOMATION AND ADVANCED TECHNOLOGYWe continue to increase our investment in R&D, innovation and automation initiatives, while embracing advanced technologies such as Industry 4.0.

These enable us to keep improving our product quality and cost efficiency, which is essential to delighting our customers and maintaining our leadership position in the international arena.

FINANCIAL HIGHLIGHTS

5,27

0.6

2,70

1.1

2,99

0.2

1,93

3.2

1,77

1.4

2,68

7.9

TOTAL ASSETS (RM MILLION)

’13 ’14 ’15 ’16 ’17 ’18

REVENUE (RM MILLION)

4,21

4.5

3,40

9.2

2,88

8.5

2,51

0.5

2,27

5.4

2,31

3.2

’13 ’14 ’15 ’16 ’17 ’18

PROFIT BEFORE TAX (RM MILLION)

528.

6

442.

2

385.

0

363.

5

216.

3

242.

2

’13 ’14 ’15 ’16 ’17 ’18

NET PROFIT (RM MILLION)

437.9

362.

4

330.

5

281.

2

183.

6

202.

8

’13 ’14 ’15 ’16 ’17 ’18

RETURN ON EQUITY (%)

18.319

.3

16.017.4

14.9

13.1

REVENUE (+23.6%) NET PROFIT (+32.3%)

RM4,214MILLION

(2017 : RM3,409 MILLION)

RM438MILLION

(2017 : RM331 MILLION)

TOTAL ASSETS (+76.3%)

RM5,271MILLION

(2017 : RM2,990 MILLION)

ROE (IMPROVED 2.3%)

18.3%(2017 : 16.0%)

EPS (+29.9%)

16.97SEN

(2017 : 13.06 SEN)

NET DIVIDENDPER SHARE (+17.2%)

8.50SEN

(2017 : 7.25 SEN)

’13 ’14 ’15 ’16 ’17 ’18


GROWTH

31.8.18 31.8.17** 31.8.16** 31.8.15 31.8.14 31.8.13Group (RM’000) (RM’000) (RM’000) (RM’000) (RM’000) (RM’000)

Turnover 4,214,482 3,409,176 2,888,515 2,510,510 2,275,366 2,313,234

Earning Before Interest, Depreciation & Taxation 694,063 483,992 524,682 441,714 301,800 310,618

Profit Before Taxation 528,595 385,043 442,202 363,538 216,310 242,204

Taxation 90,689 54,514 79,763 82,346 32,745 39,375

Profit After Tax 437,906 330,529 362,439 281,192 183,565 202,829

Profit Attributable toOwners of the Parent 434,215 330,664 360,729 279,781 180,523 196,500

Net (Borrowings) / Cash (1,854,384) 70,584 303,747 180,106 157,633 158,390

Total Equity / Net Assets 2,393,768 2,064,432 1,875,697 1,614,393 1,397,550 1,357,841

Return on Equity (%) 18.3 16.0 19.3 17.4 13.1 14.9

Net Assets Per Share (RM)*# 0.94 0.82 0.75 0.65 0.57 0.55

Basic Earnings Per Share (RM)*# 0.17 0.13 0.15 0.11 0.07 0.08

Net Dividend (sen)* 8.50 7.25 7.25 5.75 4.00 4.00

Number of Shares in Issue (’000)# 1,278,158 1,254,135 1,252,648 620,860 620,664 620,220

Share Price (RM)^ 11.14 5.61 4.25 7.72 4.79 6.14

Market Capitalisation# 14,238,680 7,035,697 5,323,754 4,793,039 2,972,981 3,808,151

* The comparative net assets per share, basic earnings per share and net dividend have been restatedtaken into account the effect of bonus issue on the basis of one new ordinary share for every one existingordinary share held in FY2018.

# Based on Company’s issued and paid up share capital, excluding treasury shares.^ As at the last trading day of the financial year.** Figures have been restated.

The Group registeredCompounded Annual Growth Rates (CAGR) for revenue and net profit attributable to equity of 24% and 27% respectively, since listing in 2001.

6-YEAR FINANCIAL REVIEW


EQUITY HOLDERS STRUCTURE (MALAYSIAN & FOREIGNER)as at 31 August 2018

SHAREHOLDER MIX(MALAYSIA VS. FOREIGN)as at 31 August 2018

Investor Relations ContactAll investors are welcome to contact the Investor Relations (IR) team directly at [email protected] or visit the Investor Relations section on our website at www.topglove.com

Note: The dividends have been restated taken into account the effect of bonus issue.

Malaysian Substantial Shareholders

Malaysian Institution

Other Malaysian Shareholders

Malaysia Retail

Foreign Shareholders

Foreign Institution

Foreign Retail

47.77% 57.78%

29.27%

7.26%

22.96%

34.91%

0.05%

Total Dividend (sen)Proposed Final Dividend (sen) Final Dividend (sen)Interim Dividend (sen)

DIVIDEND POLICY :50% OF PROFIT AFTER TAX AND MINORITY INTEREST

2013 2014 2015 2016 2017 2018Total Dividend (RM million) 99.3 99.0 143.1 181.6 181.9 217.3Payout Ratio (%) 51 55 51 50 55 50

TOTAL DIVIDEND PAYMENT OF RM1,250 MILLION SINCE LISTED IN YEAR 2001.

DIVIDEND PAYOUT

4.00

2.25 2.253.75

4.25 4.25

5.00

1.75 1.75 2.003.00 3.00 3.50

4.00

5.75

7.25 7.25

8.50

TOTAL EQUITY(RM million)

MARKET CAPITALISATION (RM million)(as at last trading day of financial year end)

2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018

1,87

5.7

2,06

4.4

2,393

.8

1,61

4.4

1,39

7.6

1,35

7.8

4,79

3.0

5,32

3.8

7,03

5.7

14,23

8.7

2,97

3.0

3,80

8.2

ENHANCING SHAREHOLDERS’ VALUE


OUR BUSINESS PHILOSOPHIES ARE:

DATO’ LEE KIM MEOWManaging DirectorTop Glove Corporation Bhd

TAN SRI DR LIM WEE CHAIExecutive ChairmanTop Glove Corporation Bhd

1WE WORK FOR OUR

CUSTOMERS

2WE TAKE CARE OF

THE INTEREST OF OUR SHAREHOLDERS

3WE ENSURE THAT OUR

EMPLOYEES CONTINUE TO CONTRIBUTE

POSITIVELY TO THE COMPANY AND WE

TAKE GOOD CARE OF THE WELL-BEING OF

OUR EMPLOYEES

4

WE WORK CLOSELY WITH OUR BANKERS,

SUPPLIERS, BUSINESS ASSOCIATES,

GOVERNMENT AUTHORITIES AND

FRIENDS

LETTER TO STAKEHOLDERS ANDMANAGEMENT DISCUSSION & ANALYSIS


DEAR FELLOW STAKEHOLDERS,FY2018 has been another exciting year for Top Glove, with many positive developments.

It has emerged another record year for us, where once again, we delivered an unmatched financial performance for our full financial year 2018. While steadily expanding organically, we also concluded several M&A exercises which unlocked synergistic opportunities for the Group. These include the acquisition of Aspion Sdn Bhd, which has enabled Top Glove to emerge the world’s largest surgical glove manufacturer and Duramedical Sdn Bhd, which saw us further diversifying into healthcare related products. Our condom factory also commenced operations, enhancing our non-glove product range offerings. In addition, we levelled up our human capital management platform to align with our future growth aspirations. In recognition of business excellence and good corporate governance, we also garnered several awards and were included on some of the most prestigious indices.

A YEAR OF RECORD HIGHS

We are very pleased to have charted another historical high with our best full-year performance yet, particularly given the challenging operating environment.

The Board of Directors and Management of Top Glove at the 27th Anniversary & Appreciation Dinner in August 2018

LETTER TO STAKEHOLDERS AND MANAGEMENT DISCUSSION & ANALYSIS

(CONT’D)

HIGHEST FULL YEAR REVENUE

RM4.2BILLION

HIGHEST FULL YEAR PROFIT AFTER TAX

RM438MILLION

HIGHEST QUARTERLY REVENUE

RM1.2BILLION

(4QFY2018)

HIGHEST FULL YEAR VOLUME SOLD

49BILLIONGLOVES

For FY2018, Top Glove once again registered record-breaking Sales Revenue of RM4.21 billion, surpassing the RM4 billion threshold and representing a 23.6% growth from FY2017. Profit Before Tax was also at an all-time high of RM528.6 million, an exceptional 37.3% jump compared with FY2017. Meanwhile, Sales Volume (quantity sold) reached its peak, surging 26% year-on-year. In FY2018, the Group also delivered its highest ever quarterly Revenue of RM1.2 billion (4QFY2018).

The Group’s favourable results were attributed to ongoing internal improvements, particularly involving the application of advanced technology which led to breakthroughs in quality enhancement and cost efficiency, and also reduced manpower requirements. Meanwhile, the uptrend in Sales Revenue followed increased demand across all glove segments, highlighting the importance of gloves as an essential item to the medical sector, increasingly stringent health requirements and rising healthcare awareness globally.



The record increase in Sales Volume of 26% versus FY2017 stemmed both from developed and developing countries, with increases recorded across all regions. Developing countries where glove usage is relatively low but rapidly rising, accounted for 72% of the growth in Sales Volume with the bulk of orders being for latex gloves, largely due to increased healthcare spending and awareness, coupled with intense marketing activities to leverage the burgeoning demand. Asia (ex-Japan) in particular experienced a 58% rise in Sales Volume while Eastern Europe was up 39.6%. The Middle East and Africa where demand is notably starting to increase, showed an uptrend in Sales Volume of 38.7% and 35.3% respectively, compared with FY2017. Meanwhile, in developed markets such as Western Europe, Sales Volume continued to move up albeit by a smaller percentage, especially for nitrile examination gloves.

Latex gloves (powdered and powder-free) were the highest contributors to total Sales Revenue, accounting for 45%, while nitrile gloves accounted for 40%. While surgical gloves comprised only 2% of our product mix, their Revenue contribution was 9% owing to higher selling prices.

The strong demand growth also led to a higher utilisation rate, resulting in improved efficiency and margins. These, coupled with targeted internal improvement initiatives were instrumental in achieving Top Glove’s highest ever Profit Before Tax (PBT) as well as better EBITDA in FY2018.

Our Sales Volume by region is depicted below:

Raw material prices for FY2018 were mixed. Natural rubber latex prices averaged at RM4.51/kg, down 21.7% against FY2017, while the average nitrile latex price was USD1.13/kg, up 2.7% compared with the previous financial year. However, we were able to offset the uptrend in nitrile latex prices by increasing our average selling prices (ASPs). We also benefited from the decrease in natural latex cost, owing to our balanced product mix which comprises both nitrile and latex gloves. Top Glove was also able to mitigate the impact of other headwinds which included the weakening of the USD and an increase in the natural gas tariff with the cost pass through system.

Meanwhile, both our Thailand and China operations continued to contribute positively to the Group with additional capacity coming on-stream as well as increased operational efficiency arising from higher utilisation. However, competition in China has intensified as more glovemakers comply with regulations or move to areas which are not affected by the country’s strict enforcement against polluting industries.

MANAGEMENT DISCUSSION AND ANALYSIS

Top Glove’s all-time high Sales Revenue of RM4.21 billion in FY2018 came on the back of an increase in demand across all glove segments, underscoring the importance of maintaining a comprehensive range of gloves and balanced product mix which is aligned with global demand. In particular, surgical gloves sales saw a surge of 76% vis-à-vis FY2017, which includes 5 months’ contribution from Aspion from the time of completion of the M&A exercise in April 2018.

(CONT’D)

OCEANIA

ASIA

EASTERNEUROPE

NORTH AMERICA

LATIN AMERICA

AFRICA

WESTERNEUROPE

Western EuropeFY18 vs FY17

35.8%

North AmericaFY18 vs FY17

1.6%

Latin AmericaFY18 vs FY17

21.8%

Eastern EuropeFY18 vs FY17

39.6%

AfricaFY18 vs FY17

35.3%

Middle EastFY18 vs FY17

38.7%

Asia ex JapanFY18 vs FY17

58.0%

JapanFY18 vs FY17

7.0%

STRONG GROWTH IN DEVELOPING COUNTRIES

SALES VOLUME (QUANTITY) COMPARISON BY REGION


The geographical breakdown of Sales Volume for FY2018 is depicted below:

FY2018 Sales Volume by Geography

Our product mix by Sales Volume (Quantity Sold) and Sales Revenue for FY2018 is depicted below:

a) Product mix by Sales Volume from FY2014 toFY2018

b) Product mix by Sales Revenue for FY2018

We are optimistic that global glove demand will continue to rise steadily going forward, and expect around 10% growth yearly, as gloves represent an indispensable item in the healthcare sector for which there is presently no replacement. Gloves are also a disposable item for one-time use; hence demand is recurring. Glove usage is also expected to increase as hygiene standards continue to rise and health regulations become progressively stringent, mandating the use of gloves. Growing awareness of the importance of healthcare along with the emergence of new health threats like H1N1, bird flu and Ebola, also keep gloves at the forefront. Additionally, a growing ageing population, which is susceptible to disease and requires more medical attention will boost glove usage considerably.

Top Glove’s consistently strong performance underscores the effectiveness of internal improvement initiatives pursued on a continuous basis in the following areas:

i) Utilities

• Natural Gas For better gas energy savings, we invested inhigher efficiency heating elements and specialthermal insulation, and also replaced metals with engineering plastics. In addition, we improvedhot air circulation and maximised the recoveryof usable heat in production. Combustionemissions are continuously monitored, whilecombustion equipment is serviced regularly toensure consistent combustion efficiency. Thesehave enabled us to mitigate the cost impact ofthe 23.5% hike in the gas tariff which came intoeffect January 2018.


(CONT’D)

Africa

Japan

Middle East

Latin America

Asia ex Japan

North America

Europe

31%Europe

3%Africa

25%North America

15%Asia ex Japan

11%Latin

America

8%Middle

East

7%Japan

0%

10%

20%

30%

40%

50% 48%

24%

20%

6%

2%

46%

28%

18%

6%

2% 2% 2% 2%

39%

32%

19%

8%

32%

20%

10%

31%

36%

20%

11%

FY2014 FY2015 FY2016 FY2017 FY2018

36%

Nitrile gloves

Latex powdered gloves

Latex powder-free gloves

Vinyl / TPE / CPE gloves

Surgical gloves

TPE/CPE

Vinyl

Surgical

Powder-free latex

Powdered latex

Nitrile

1%TPE/CPE

40%Nitrile

26%Powdered latex

19%Powder-free

latex

9%Surgical

5%Vinyl



(CONT’D)

• Water Our ongoing water saving projects includerain water harvesting, water recycling andautomation of water supply and control. Toensure an adequate supply is available foreveryday operations, we invested in a ReverseOsmosis Treatment Plant (ROTP) which treatswastewater discharged from the surroundingfactories, converting it into clean water, whichis then channeled back into the factories forreuse in production. This has yielded a 15.7%reduction in average water consumption volume per glove.

• Electricity Our initiatives to minimise wastage of electricityinclude stabilising the electric power quality,investing in more efficient equipment andconducting regular maintenance on electricaldistribution systems.

ii) Automation and Digitalisation We continue to automate our operations, enablingus to reduce manpower dependency and cost, aswell as human error. As we move towards Industry4.0, we are also increasingly focusing on processdigitalisation for better data accuracy and big datatraceability.

Factory Country Glove Type Number of production lines

Capacity (pieces per annum)

Current: 32 glove factories All 648 lines 60.5 bn

Expansion in progress:

F32 1st Phase (Early 2019) Malaysia Nitrile 22 lines 2.2 bn

F32 2nd Phase (End 2019) Malaysia Nitrile 12 lines 1.2 bn

F33 New Block (Early 2019) Malaysia Nitrile 12 lines 1.2 bn

F5A New Block (End 2019) Malaysia Nitrile 20 lines 2.0 bn

F8A 1st Phase (Early 2020) Thailand Nitrile/Latex 32 lines 3.2 bn

F40 2nd Phase (Mid 2020) Malaysia Nitrile 22 lines 2.2 bn

F41 1st Phase (End 2020) Malaysia Nitrile 12 lines 1.2 bn

Total Expansion 132 lines 13.2 bn

Total by 2020 : 36 glove factories 780 lines 73.7 bn

iii) Downtime Reduction With the widespread implementation of predictiveand preventive maintenance for critical machineryand equipment, we have minimised the occurrenceof unscheduled downtime thereby ensuringcontinuity of operations, which translates intohigher productivity.

iv) Productivity Improvement To enhance productivity, we are working towardsincreasing production line speed by focusing onbreakthroughs from engineering, structural andmechanical improvements. Other initiatives includeincreasing heating and drying efficiency, betterchemical formulation and process control, as wellas overhauling of under-performing productionlines, the result of which production efficiency forexisting factories has increased by an average of12% in FY18.

CORPORATE MILESTONES

Organic expansion

To ensure we are well-positioned to meet the robust global demand for gloves and achieve our ambitious Fortune Global 500 dream, Top Glove will continue to pursue strategic expansion.

Our blueprints for expansion are detailed in the diagram below.

Organic Expansion Plans for Top Glove

Top Glove is also looking to expand its operations to Vietnam and has entered into an agreement to acquire a piece of land for a factory which is expected to commence operations within the next 2 years. Meanwhile, Top Glove’s condom manufacturing facility commenced production in July 2018 and is presently awaiting certification.


On an acquisition trail: M&A’s and JV’s

In support of its ambitious growth agenda Top Glove will also continue to explore inorganic expansion via mergers and acquisitions, joint ventures as well as new set-ups in related industries in order to grow faster and more efficiently. In April 2018, we completed the acquisition of Aspion Sdn Bhd, one of the largest surgical glove producers globally, making Top Glove the world’s largest surgical glove manufacturer and providing our enlarged customer base with an enhanced range of high quality, cost-effective medical gloves.

In line with the Group’s plans to further diversify into medical products, we also acquired Duramedical Sdn Bhd, a company manufacturing dental hygiene products and exercise bands. This, along with the establishment of our condom factory, marks the start of the Group’s venture into other rubber related businesses, which we aim to grow over time.

In addition, to improve our supply chain coordination as well as cost and quality control for glove packaging materials, we acquired Eastern Press Sdn Bhd, a printing and packaging material manufacturer.

Top Glove also established a majority held joint venture with Fimatec to produce ground calcium carbonate slurry (a raw material) for use in glove production, for better cost efficiency.


(CONT’D)

Other developments

The Group also proposed to undertake a bonus issue of 1,280,229,124 new ordinary shares in Top Glove Corporation Bhd on the basis of 1 bonus share for every existing Top Glove share held on the entitlement date, which was approved at an EGM held on 10 October 2018 and completed on 29 October 2018. The said EGM also approved a proposal to undertake a bonds issue to raise funds for the repayment of bank borrowings, as well as amendments to the Company’s Constitution to facilitate the issuance of bonus shares for the bonus issue.

Underscoring the Group’s commitment to enhance shareholder value, the Board recommended a final dividend of 5 sen per share, subject to shareholders’ approval at the upcoming AGM in January 2019. This would bring the total FY2018 dividend payout to 8.5 sen per share, an increase of 1.25 sen or 17% over FY2017, representing a net profit payout ratio of 50%.

In recognition of its product excellence, Top Glove garnered the Most Innovative Award 2018 and Export Excellence Award 2018 by the Malaysian Rubber Export Promotion Council (MREPC). In addition, Top Glove was named one of the Best Companies to Work for in Asia 2018 by HR Asia. Top Glove was also included in the MSCI Global Standard Index and maintained its inclusion on the FTSE4Good Bursa Malaysia Index, both tributes to its strong, consistent growth and good corporate governance.

Towards strengthening our people processes, the Group also invested in SAP SuccessFactors to transform its Human Capital Management (HCM) platform, with a view to attracting and on-boarding the right talent.

Top Glove’s Board of Directors at the 19th Annual General Meeting held on 9 January 2018


Tan Sri Dr Lim Wee Chai and Dato’ Lee Kim Meow present the Best Factory 2017/2018 Award to Mr. Ravi (4th from left) accompanied by Mr. Ho Kim Nam (representing Factory 14). The runner-up award went to Factory 13 headed by Mr. Lew Sin Chiang (far right) and accompanied by Mr. Selvan Murugan while the Most Improved Factory Award was given to M02 headed by Mr. Wong Chong Ban (2nd from left) accompanied by Mr. Kelvin Lee.

BUILDING A BUSINESS FOR GOOD

We are mindful that our duty to create value does not only extend to our immediate shareholders but the society in which we operate. Accordingly, even as we set and pursue greater goals for the expansion of our business, a foremost consideration is to ensure that our growth does not come at the expense of society or the environment.

Our Sustainability Statement which discusses our custodianship of the 3 sustainability pillars covering Environmental, Social and Economic aspects may be found on pages 48 to 59.

R&D AND TECHNOLOGICAL ADVANCEMENT

Our dedicated R&D Centre is charged with driving R&D initiatives and innovation at Top Glove. Since its inception in 2013, the centre has undergone rapid expansion in terms of facilities and workforce, underscoring its increasing importance in Top Glove. The R&D team’s total headcount of 151 (as at 31 August 2018) includes 86 researchers comprised of 16 PhD, 19 Master’s and 47 Bachelor’s degree holders. Investments have also been made to equip the R&D Centre with the latest analytical and characterisation instruments such as SEM-EDX, HPLC and GCMS.

Our R&D initiatives have enabled new ideas and concepts to be translated into commercially viable products for our customers such as GripPlusTM Nitrile Examination Gloves, CPE Double Textured Gloves and Accelerator-Free Damp Donning Nitrile Gloves. Efforts have also been made to ensure the newly-developed products meet stringent international directives and regulations. Additionally, investments have been made towards obtaining product certifications such as FDA’s 510(k), chemotherapy drug testing, modified Draized-95 test and others. Top Glove factories are also certified with ISO9001 and ISO13485 to ensure our products fulfill GMP requirements. Top Glove will continue to focus on product innovation to ensure we remain relevant and competitive in the global arena.

Towards remaining market-responsive, we are also pursuing process innovation. This is especially important in our industry where rapid technological advancements, evolving industrial standards and volatile raw material prices have significantly increased competition between market players.

In 2015, Top Glove established an in-house former repair service to improve cost efficiency in this area. Where previously, former repair was outsourced, we are now able to do this in-house enabling us to save on purchasing new formers as well as time taken to send for external repair. Top Glove also invested approximately RM7 million to develop an innovative method to repair formers through reglazing, which reduces the need to purchase new formers, the cost of which amounts to RM2 million a month. As of now, a total of seven kilns (former repair facilities) have been set up, with five in Malaysia and two more in Thailand.

A chemical dispersion plant was established for in-house chemical dispersions like functionalised reinforcing agents, latex dispersion stabilisers and curing agents. This opens up the possibility of modifying glove formulations faster to meet market demand at an efficient cost, while improving the consistency of glove quality and ultimately reducing the lead time for glove product enhancement.

Moving towards automation and digitalisation, we also invented an online defective glove inspection system. This serves to reduce our manpower dependency and increase the efficiency of the glove inspection process. The robotic simulation system in our R&D Centre also expedites the research process through a programming system which enables us to simulate the processing of glove products in different parameters.

In line with our commitment to the environment, we have adopted a ‘Zero Waste’ concept, which involves managing processes to avoid, conserve, recover and reuse waste for other purposes. With this in mind, we developed an environmentally-friendly cleaning agent for online former washing, which uses wastewater generated from the glove manufacturing process. This innovative process not only reduces production cost but is also proven to be more efficient in prolonging former shelf life.

Top Glove works with experienced IP attorneys and agents, to manage the IP filing and application process, towards properly protecting its intellectual property. As at FYE2018, we had filed a total of 84 patents and patent applications locally and internationally, which includes 22 granted patents. In addition, we also filed 42 trademarks in multiple classes and 5 industrial designs locally and internationally.


(CONT’D)


Top Glove’s directors and key management at the company’s Board Offsite Meeting in Thailand led by its Corporate Advisor, Tan Sri Megat Zaharuddin


(CONT’D)

LOOKING AHEAD

Even as we chart our growth for the year ahead, Top Glove is mindful of potential challenges which include cost increases and intensifying competition. Nonetheless, we remain confident of industry prospects and that demand will continue expanding healthily by 10% yearly.

While the ongoing trade war between US and China may represent an area of concern for the business community, we believe the impact on our business will be minimal as our industry is relatively resilient to political and economic uncertainty. However, we remain watchful of developments in this area and it is our hope that business will be allowed to flourish freely without sanctions being imposed.

In the dawn of a new Malaysia, we continue to be highly supportive of the government’s anti-corruption drive, to free Malaysia from all forms of corrupt practices, towards a more business-friendly environment. We also hope that the water crisis in Selangor will be fully resolved expeditiously for the benefit of the rakyat and business communities.

We also look forward to expanding our footprint into Vietnam, upon receiving approval from the investment authority of Vietnam.

While we are aware that challenges will always be present, our approach has always been to focus on what is within our control, rather than external factors which are not. As we continue to pursue internal improvement initiatives in line with our Business Direction to produce high quality gloves at an efficient low cost, I believe we will be well-positioned to overcome any obstacles and stay on course to achieve our business goals.

IN APPRECIATION

On behalf of the Board, I would like to extend my gratitude to my fellow Top Glovers for their level of dedication, which is second to none. Your positive contributions have resulted in the resounding success we enjoy today and we are excited to pursue our ambitious growth agenda together with you.

We also wish to express our deepest appreciation to our valued shareholders, customers, vendors and business associates for your unwavering support and continued confidence in the Group. We look forward to deepening our relationship with you for many years to come.

Lastly, we would like to express our thanks to our fellow board members for their invaluable guidance and unparalleled commitment to take Top Glove to the next level of success.

We have set ourselves very big goals which will certainly stretch us beyond the familiar. Indeed, the level of transformative growth we are pursuing lies outside the limits of our comfort zone. However, we believe that with your loyal support and the indomitable spirit that Top Glove has come to be known for, there is no dream out of our reach and nothing we cannot achieve.

Thank you.

TAN SRI DR LIM WEE CHAI DATO’ LEE KIM MEOWExecutive Chairman Managing DirectorTop Glove Corporation Bhd Top Glove Corporation Bhd31 October 2018 31 October 2018


KEHADAPAN PARA PIHAK BERKEPENTINGAN,Tahun Kewangan 2018 (TK2018) merupakan satu lagi tahun yang menarik bagi Top Glove, dengan pelbagai perkembangan positif.

Ia tahun penciptaan rekod untuk kami, di mana kami sekali lagi menyampaikan prestasi kewangan cemerlang untuk tahun kewangan penuh 2018. Sementara masih berkembang secara organik, kami juga telah menyimpulkan beberapa penggabungan dan pengambilalihan yang membuka peluang sinergi kepada Kumpulan. Ini termasuk pengambilalihan Aspion Sdn Bhd, yang telah membolehkan Top Glove muncul sebagai pengeluar sarung tangan pembedahan terbesar di dunia dan Duramedical Sdn Bhd, yang membolehkan kami mempelbagaikan campuran keluaran untuk termasuk produk penjagaan kesihatan selain sarung tangan. Kilang pengeluaran kondom kami juga telah mula beroperasi, lalu mengukuhkan rangkaian produk bukan sarung tangan kami. Di samping itu, kami telah meningkatkan platform pengurusan sumber manusia selaras dengan pertumbuhan masa depan kami. Sebagai pengiktirafan kecemerlangan perniagaan dan tadbir urus korporat yang baik, kami juga telah memperoleh beberapa anugerah dan tersenarai dalam beberapa indeks berprestij.

TAHUN REKOD TERTINGGI

PENDAPATAN TAHUN PENUH TERTINGGI

RM4.2BILION

KEUNTUNGAN SELEPAS CUKAI TAHUN PENUH

TERTINGGI

RM438JUTA

PENDAPATAN SUKU TERTINGGI

RM1.2BILION

(4STK2018)

VOLUM JUALANTAHUN PENUH

TERTINGGI

49BILION

SARUNG TANGAN

Dato’ Lee Kim Meow menerima sijil ISO 37001 Sistem Pengurusan Anti-Rasuah daripada SIRIM pada bulan Disember 2017 bagi pihak Top Glove

Kami dengan sukacitanya telah mencatat satu lagi tahun bersejarah dengan prestasi tahun kewangan penuh terbaik, walaupun dalam persekitaran operasi yang mencabar.

Bagi TK2018, Top Glove sekali lagi memecah rekod dengan mencatatkan Pendapatan Jualan tertinggi pada RM4.21 bilion, mengatasi ambang RM4 bilion dan mewakili peningkatan sebanyak 23.6% berbanding TK2017. Keuntungan Sebelum Cukai juga mencatat jumlah tertinggi pada RM528.6 juta, pelonjakan sebanyak 37.3% berbanding TK2017. Sementara itu, Volum Jualan (kuantiti dijual) mencapai puncaknya dengan peningkatan 26% tahun-ke-tahun. Pada TK2018, Kumpulan turut mencapai Pendapatan tertinggi bagi satu suku kewangan dengan RM1.2 bilion (4STK2018).

PERUTUSAN KEPADA PIHAK BERKEPENTINGAN & PERBINCANGAN DAN ANALISIS PIHAK PENGURUSAN

LETTER TO STAKEHOLDERS : BAHASA MALAYSIA VERSION


Rangkaian produk sarung tangan Top Glove

Para belia syarikat yang menghadiri Sidang Kepimpinan Belia Top Glove 2018 yang diadakan dua tahun sekali


LETTER TO STAKEHOLDERS : BAHASA MALAYSIA VERSION (SAMB.)

Keputusan positif Kumpulan dikaitkan dengan usaha penambahbaikan dalaman yang berterusan. Khususnya, penggunaan teknologi baharu menyumbang kepada peningkatan kualiti dan kecekapan kos, serta mengurangkan keperluan tenaga manusia. Tambahan lagi, peningkatan Pendapatan Jualan disumbang oleh pertumbuhan permintaan yang kukuh merentasi semua segmen sarung tangan, membuktikan keperluan sarung tangan sebagai alat penting dalam sektor perubatan, piawaian kesihatan yang semakin ketat dan peningkatan kesedaran penjagaan kesihatan secara global.

Harga bahan mentah sewaktu TK2018 pula bercampur-campur. Harga purata susu getah asli dinyatakan pada RM4.51/kg, turun 21.7% berbanding TK2017, manakala harga purata lateks nitril pula USD1.13/kg, naik 2.7% berbanding tahun kewangan sebelumnya. Namun, kami dapat mengimbangi kenaikan harga lateks nitril dengan menaikkan harga purata jualan. Kami juga bermanfaat daripada penurunan harga susu getah asli, dikaitkan dengan campuran keluaran seimbang kami yang terdiri daripada sarung tangan nitril dan getah asli. Top Glove juga mampu mengurangkan impak lain termasuk mata wang dolar Amerika Syarikat yang semakin lemah dan kenaikan tarif gas asli melalui pemindahan kos.

Sementara itu, operasi kami di China dan Thailand terus menyumbang secara positif kepada Kumpulan dengan kapasiti tambahan dan peningkatan kecekapan operasi yang timbul daripada penggunaan yang lebih tinggi. Walaubagaimanapun, persaingan di China semakin meningkat berikutan lebih banyak pengeluar sarung tangan yang mematuhi penguatkuasaan atau memindahkan operasi pengeluaran mereka ke kawasan yang tidak diliputi oleh penguatkuasaan negara yang tegas terhadap pencemaran industri.

PERBINCANGAN DAN ANALISIS PENGURUSAN

Pendapatan tertinggi Top Glove sebanyak RM4.21 bilion pada TK2018 disokong dengan peningkatan permintaan bagi semua segmen sarung tangan, lalu menekankan kepentingan untuk mengekalkan produk sarung tangan yang komprehensif dan campuran keluaran yang seimbang, sejajar dengan permintaan global. Khususnya, jualan sarung tangan pembedahan meningkat sebanyak 76% berbanding TK2017, termasuk sumbangan 5 bulan daripada Aspion dari tarikh selesai pengambilalihan pada April 2018.

Peningkatan Volum Jualan sebanyak 26% berbanding TK2017 berpunca daripada negara-negara maju dan membangun, dengan peningkatan dicatat di semua rantau. Negara-negara membangun dimana penggunaan sarung tangan masih rendah tetapi pantas meningkat, menyumbang sebanyak 72% pertumbuhan pada Volum Jualan dengan pesanan besar untuk sarung tangan getah asli, sebahagian besarnya disebabkan oleh peningkatan perbelanjaan dan kesedaran penjagaan kesihatan, ditambah pula dengan aktiviti pemasaran sengit untuk menyokong permintaan yang semakin meningkat. Volum Jualan pada Asia (kecuali Jepun) meningkat 58% sementara Eropah Timur naik 39.6%. Timur Tengah dan Afrika pula, dimana permintaan semakin meningkat, menunjukkan kenaikan pada Volum Jualan masing-masing sebanyak 38.7% dan 35.3% berbanding TK2017. Sementara itu, Volum Jualan bagi pasaran maju seperti Eropah Barat, terus meningkat walaupun dengan peratusan yang kecil terutamanya bagi sarung tangan pemeriksaan nitril.




Sarung tangan getah asli (berserbuk dan bebas serbuk) merupakan penyumbang tertinggi kepada jumlah Pendapatan Jualan, dengan sumbangan 45% sementara sarung tangan nitril menyumbang 40%. Walaupun sarung tangan pembedahan hanya terdiri daripada 2% campuran keluaran kami, sumbangan Pendapatan Jualan segmen tersebut adalah sebanyak 9% disebabkan harga jualan yang lebih tinggi.

Pertumbuhan permintaan yang kukuh juga membawa kepada kadar penggunaan yang lebih tinggi, lalu menghasilkan peningkatan pada kecekapan dan margin. Faktor-faktor ini serta inisiatif-inisiatif penambahbaikan dalaman memainkan peranan penting dalam mencapai Keuntungan Sebelum Cukai (PBT) tertinggi Top Glove serta EBITDA yang lebih baik pada TK2018.

Volum Jualan mengikut rantau adalah seperti berikut:

Sesi bergambar bersama ahli-ahli Majlis Pelabur Institusi Malaysia (IICM) sewaktu lawatan mereka ke Top Glove pada bulan September 2018

OCEANIA

ASIA

EROPAH TIMUR

AMERIKA UTARA

AMERIKA LATIN

AFRIKA

EROPAH BARAT

Eropah BaratTK18 vs TK17

35.8%

Amerika UtaraTK18 vs TK17

1.6%

Amerika LatinTK18 vs TK17

21.8%

Eropah TimurTK18 vs TK17

39.6%

AfrikaTK18 vs TK17

35.3%

Timur TengahTK18 vs TK17

38.7%

Asia (kecuali Jepun)TK18 vs TK17

58.0%

JepunTK18 vs TK17

7.0%

PENINGKATAN KUKUH BAGI NEGARA-NEGARA MEMBANGUN

PERBANDINGAN VOLUM JUALAN (KUANTITI) MENGIKUT RANTAU


Volum Jualan mengikut geografi bagi TK2018 adalah seperti berikut:

Volum Jualan TK2018 mengikut geografi

Campuran keluaran mengikut Volum Jualan (Kuantiti Dijual) dan Pendapatan Jualan bagi TK2018 adalah seperti berikut:

a) Campuran keluaran mengikut Volum Jualandari TK2014 ke TK2018

b) Campuran keluaran mengikut PendapatanJualan bagi TK2018

Kami kekal optimis bahawa permintaan global bagi sarung tangan akan terus meningkat pada masa akan datang, dan menjangka pertumbuhan sekitar 10% setahun, kerana sarung tangan merupakan antara barangan keperluan dalam sektor penjagaan kesihatan yang tiada gantinya. Sarung tangan juga merupakan barangan pakai buang yang digunakan sekali sahaja; maka permintaan baginya akan berulang. Penggunaan sarung tangan pula dijangka bertambah disebalik piawain kebersihan yang semakin meningkat dan pengawalan kesihatan yang semakin ketat, seterusnya membuktikan keperluan bagi sarung tangan. Kesedaran yang semakin meningkat tentang kepentingan penjagaan kesihatan serta kemunculan ancaman kesihatan baru seperti H1N1, selsema burung dan Ebola, juga menyumbang kepada keutamaan sarung tangan. Lanjutan daripada itu, peningkatan masyarakat berumur yang lebih senang terdedah kepada penyakit dan memerlukan lebih perhatian kesihatan, juga akan menyumbang kepada peningkatan penggunaan sarung tangan.

Keputusan tekal kukuh Top Glove dikaitkan dengan keberkesanan kepada inisiatif-inisiatif penambahbaikan dalaman yang dilakukan secara berterusan dalam beberapa kawasan berikut:

i) Utiliti• Gas Asli

Demi menjimat tenaga gas, kami telahmembuat pelaburan untuk elemenpemanasan yang lebih cekap danpenebat termal pemanasan khas, sertamenggantikan logam dengan plastikkejuruteraan. Sehubungan dengan itu,kami telah mengambil langkah untukmeningkatkan peredaran udara panas danmemaksimumkan pemulihan haba yangboleh digunakan dalam proses pengeluaran.Pelepasan pembakaran sentiasa dipantau,sementara peralatan pembakaran kerapmenjalani penyelenggaraan bagi memastikankecekapan pembakaran yang konsisten.Inisiatif-inisiatif ini telah membolehkankami mengurangkan kesan kos kenaikanharga tarif gas sebanyak 23.5% yang telahberkuatkuasa pada Januari 2018.

Africa

Japan

Middle East

Latin America

Asia ex Japan

North America

Europe

31%Eropah

3%Afrika

25%Amerika Utara

15%Asia

(kecuali Jepun)

11%Amerika

Latin

8%Timur

Tengah

7%Jepun

0%

10%

20%

30%

40%

50% 48%

24%

20%

6%

2%

46%

28%

18%

6%

2% 2% 2% 2%

39%

32%

19%

8%

32%

20%

10%

31%

36%

20%

11%

TK2014 TK2015 TK2016 TK2017 TK2018

36%

Sarung tangan nitril

Sarung tangan getah berserbukSarung tangan getah bebas serbuk

Sarung tangan Vinil / TPE / CPESarung tangan pembedahan

TPE/CPE

Vinyl

Surgical

Powder-free latex

Powdered latex

Nitrile

1%TPE/CPE

40%Nitril

26%Getah berserbuk

19%Getah bebas

serbuk

9%Pembedahan

5%Vinil




Pelaburan dalam Penyelidikan dan Pembangunan (R&D) memainkan peranan penting dan sentiasa menjadi tunggak utama Top Glove

• Air Projek-projek penjimatan air kami yangberterusan termasuk penuaian air hujan,kitaran semula air dan automasi bekalan dankawalan air. Demi memastikan bekalan yangmencukupi untuk operasi harian, kami telahmembuat pelaburan bagi Kitaran RawatanLoji Osmosis (ROTP) yang merawat airkumbahan yang dilepaskan dari kilang-kilangsekeliling, mengubahnya menjadi air bersih,dan kemudian disalurkan semula ke kilang-kilang untuk digunakan. Rawatan ini telahmengurangkan jumlah purata penggunaan airbagi setiap sarung tangan sebanyak 15.7%.

• Elektrik Inisiatif-inisiatif untuk mengurangkanpembaziran elektrik termasuk menstabilkankualiti tenaga elektrik, melabur dalamperalatan yang lebih cekap dan menjalankanpenyelenggaraan rutin sistem pengedaranelektrik.

Kilang Negara Jenis sarung tangan

Bilangan barisan pengeluaran

Kapasiti (keping setahun)

Semasa: 32 kilang sarung tangan Semua 648 barisan 60.5 bn

Perkembangan dalam proses:

F32 Fasa 1 (Awal 2019) Malaysia Nitril 22 barisan 2.2 bnF32 Fasa 2 (Akhir 2019) Malaysia Nitril 12 barisan 1.2 bnF33 Blok Baru (Awal 2019) Malaysia Nitril 12 barisan 1.2 bnF5A Blok Baru (Akhir 2019) Malaysia Nitril 20 barisan 2.0 bnF8A Fasa 1 (Awal 2020) Thailand Nitril/Getah Asli 32 barisan 3.2 bnF40 Fasa 2 (Pertengahan 2020) Malaysia Nitril 22 barisan 2.2 bnF41 Fasa 1 (Akhir 2020) Malaysia Nitril 12 barisan 1.2 bnJumlah perkembangan 132 barisan 13.2 bnJumlah menjelang 2020: 36 kilang sarung tangan 780 barisan 73.7 bn

ii) Automasi dan digitalisasi Kami terus mengautomasikan operasiyang membolehkan kami mengurangkanpergantungan pada tenaga manusia dan kos,serta kesilapan manusia. Ke arah Industri 4.0,kami juga menumpukan perhatian kepada prosesdigitalisasi untuk ketepatan data yang lebih baikdan kebolehkesanan data yang besar.

iii) Pengurangan masa henti Dengan pelaksanaan penyelenggaraan ramalandan pencegahan untuk jentera dan peralatankritikal, kami telah meminimumkan terjadinyamasa henti tidak terjadual dengan memastikankesinambungan operasi, yang diterjemahkan kedalam produktiviti yang lebih tinggi.

iv) Peningkatan produktiviti Demi meningkatkan produktiviti, kami sedangberusaha untuk meningkatkan kelajuan barisanpengeluaran dengan memberi tumpuankepada kelebihan kejuruteraan, struktur danpenambahbaikan mekanikal. Inisiatif-inisiatif laintermasuk peningkatan kecekapan pemanasandan pengeringan, perumusan kimia danpengendalian proses yang lebih baik, sertamembaikpulih barisan pengeluaran yang kurangberprestasi. Hasilnya, kecekapan pengeluaranbagi kilang sedia ada telah meningkat sebanyak12% pada TK18.

PENCAPAIAN KORPORAT

Perkembangan organik

Demi memastikan kami berada di kedudukan yang baik untuk memenuhi peningkatan permintaan global dan mencapai matlamat Fortune Global 500 kami, Top Glove akan terus berkembang secara strategik.

Butiran terperinci perkembangan kami adalah seperti rajah berikut:

Top Glove juga ingin memperluaskan operasi ke Vietnam dan telah memeterai perjanjian untuk memperoleh sebidang tanah bagi pembangunan sebuah kilang yang dijangka memulakan operasi dalam tempoh 2 tahun akan datang. Di samping itu, kilang pengeluaran kondom Top Glove telah mula beroperasi pada Julai 2018 dan sedang menunggu pensijilan.




Lawatan kehormatan H.E. Mr. Narong Sasitorn (ke-4 dari kiri), Duta Thailand ke Malaysia di Menara Top Glove pada bulan September 2018.

Pengembaraan pemerolehan: penggabungan, pengambilalihan dan usaha sama

Demi mencapai agenda perkembangannya, Top Glove juga akan terus usaha untuk berkembang secara bukan organik melalui penggabungan dan pengambilalihan, usaha sama serta pembangunan baru dalam industri yang berkaitan sebagai cara yang lebih cepat dan cekap. Pada April 2018, kami telah selesai mengambilalih Aspion Sdn Bhd, antara pengeluar sarung tangan pembedahan terbesar di dunia, seterusnya menjadikan Top Glove pengeluar sarung tangan pembedahan terbesar di dunia dan memperbesarkan pangkalan pelanggan kami dengan penambahan pada rangkaian sarung tangan perubatan berkualiti tinggi dan kos efektif.

Selaras dengan rancangan perkembangan Top Glove dalam mempelbagaikan produk perubatan lain, ia telah memperoleh Duramedical, sebuah syarikat pengeluar produk pembersihan gigi dan pita senaman. Ditambah lagi dengan kilang kondomnya, ini menandakan usaha permulaan Kumpulan dalam mempelbagaikan perniagaan ke produk getah yang berkaitan, yang mana Kumpulan harap akan terus berkembang dari semasa ke semasa.

Selain itu, Top Glove telah memperoleh Eastern Press Sdn Bhd, sebuah syarikat pengeluar bahan pencetakan dan pembungkusan, bagi meningkatkan koordinasi rantaian bekalan pembungkusan Kumpulan serta pengawalan pada kualiti dan kos.

Top Glove juga telah menubuhkan usaha sama majoriti bersama Fimatec untuk menghasilkan buburan kalsium karbonat tanah (bahan mentah) untuk digunakan dalam pengeluaran sarung tangan, untuk kecekapan kos yang lebih baik.

Perkembangan lain

Di samping itu, cadangan Kumpulan untuk menerbit bonus sebanyak 1,280,229,124 saham biasa baru Top Glove Corporation Bhd berdasarkan 1 saham bonus bagi setiap saham yang dipegang pada tarikh kelayakan telah diluluskan pada EGM bertarikh 10 Oktober 2018 dan telah selesai pada 29 Oktober 2018. EGM tersebut juga meluluskan cadangan menerbit jaminan bon boleh ditukar untuk mengumpul dana bagi pembayaran balik pinjaman bank, serta pindaan kepada Perlembagaan Syarikat untuk memudahkan pengeluaran saham bonus bagi terbitan bonus.

Menekankan komitmen Kumpulan untuk meningkatkan nilai pemegang saham, Lembaga Pengarah mencadangkan dividen akhir sebanyak 5 sen sesaham, tertakluk kepada kelulusan pemegang saham pada AGM yang akan datang pada Januari 2019. Ini akan membawa jumlah dividen FY2018 kepada 8.5 sen sesaham, peningkatan sebanyak 1.25 sen atau 17% berbanding TK2017, mewakili nisbah pembayaran untung bersih sebanyak 50%.

Sebagai pengiktirafan keatas keunggulan produknya, Top Glove telah menerima Anugerah Paling Inovatif 2018 dan Anugerah Kecemerlangan Eksport 2018 daripada Majlis Promosi Eksport Getah Malaysia (MREPC). Tambahan pula, Top Glove dinamakan antara Syarikat Terbaik untuk Bekerja di Asia 2018 oleh HR Asia. Top Glove turut tersenarai dalam Indeks Piawaian Global MSCI dan kekal tersenarai dalam Indeks FTSE4Good Bursa Malaysia, sebagai bukti pertumbuhan Top Glove yang kukuh dan konsisten serta tadbir urus korporat yang baik.

Demi memperkukuhkan proses-proses sumber manusia, Kumpulan juga telah membuat pelaburan untuk SAP SuccessFactors dalam mengubah platform pengurusan sumber manusia, dengan tujuan untuk menarik dan rekrut bakat yang betul.

MEMBINA PERNIAGAAN YANG BAIK

Kami sedar bahawa kewajipan kami untuk mencipta nilai tidak hanya melangkaui pemegang saham terdekat kami tetapi masyarakat sekeliling operasi kami. Sehubungan itu, walaupun kami menetapkan dan meneruskan matlamat yang lebih besar untuk mengembangkan perniagaan kami, pertimbangan utama adalah untuk memastikan pertumbuhan kami tidak datang dengan membawa padah kepada masyarakat mahupun alam sekitar.

Laporan Kemapanan kami yang membincangkan 3 tiang mapan yang terdiri daripada Alam Sekitar, Sosial dan Ekonomi boleh didapati di muka surat 48 hingga 59.




Lawatan dari Kelab 30% Malaysia: Puan Fatimah Merican (ketiga dari kiri) and Datin Sunita Rajakumar (kelima dari kiri) bersama ahli-ahli Lembaga Nominasi dan Saraan.

KEMAJUAN PENYELIDIKAN DAN PEMBANGUNAN (R&D) DAN TEKNOLOGI

Pusat R&D kami diamanahkan untuk memandu inisiatif R&D dan inovasi di Top Glove. Sejak penubuhannya pada tahun 2013, ia telah berkembang pesat dari segi kemudahan dan tenaga kerja, menekankan kepentingannya di Top Glove. Kini, jabatan ini mempunyai 151 jumlah tenaga kerja (pada 31 Ogos 2018) termasuk 86 orang penyelidik yang terdiri daripada 16 pemegang PhD, 19 pemegang ijazah Sarjana dan 47 pemegang ijazah Sarjana Muda. Pelaburan juga telah dibuat untuk melengkapkan Pusat R&D dengan peralatan analitik dan pencirian terkini seperti SEM-EDX, HPLC dan GCMS.

Inisiatif-inisiatif R&D kami telah membolehkan idea dan konsep baru diterjemahkan ke dalam produk yang berdaya maju untuk pelanggan kami seperti sarung tangan pemeriksaan nitril GripPlus™, sarung tangan dwi-tekstil CPE dan sarung tangan nitril lembap tanpa accelerator. Usaha juga telah dibuat untuk memastikan produk baru memenuhi arahan dan peraturan antarabangsa yang ketat. Pelaburan juga telah dibuat untuk mendapatkan pensijilan produk seperti 510 (k) FDA, ujian ubat kemoterapi, ujian Draized-95 yang diubah suai dan lain-lain. Kilang-kilang Top Glove juga disijilkan ISO9001 dan ISO13485 untuk memastikan produk kami memenuhi keperluan GMP. Top Glove akan terus memberi tumpuan kepada inovasi produk untuk memastikan kami kekal relevan dan berdaya saing di arena global.

Ke arah memenuhi keperluan pasaran, kami juga akan menjayakan inovasi pemprosesan. Ini penting terutamanya dalam industri kami di mana kemajuan teknologi yang pesat, piawaian industri yang berkembang dan harga bahan mentah yang tidak menentu telah meningkatkan persaingan antara pemain pasaran.

Pada 2015, Top Glove menubuhkan perkhidmatan pembaikan acuan sarung tangan dalam syarikat untuk meningkatkan kecekapan kos. Dimana pembaikan acuan sarung tangan sebelum ini dilakukan oleh sumber luar, kini kami boleh lakukannya sendiri seterusnya menijmatkan dari membeli acuan baru serta masa yang diperlukan untuk menghantar pembaikan ke luar. Top Glove juga telah melabur sebanyak RM7 juta untuk mereka satu kaedah inovatif bagi pembaikan acuan secara gilap semula, seterusnya mengurangkan keperluan untuk membeli semula acuan baru dimana kosnya berjumlah RM2 juta sebulan. Setakat ini, sebanyak tujuh tanur (kemudahan membaiki acuan) telah ditubuhkan, lima daripadanya di Malaysia dan dua lagi di Thailand.

Sebuah loji penyebaran kimia telah dibangunkan untuk penyebaran kimia seperti agen pengukuhan berfungsi, penstabil penyebaran getah dan agen pengawetan. Ini membuka peluang kemungkinan R&D untuk mengubahsuai formasi sarung tangan lebih cepat demi memenuhi permintaan pasaran dengan kos yang cekap, sambil meningkatkan konsistensi kualiti sarung tangan dan sejurusnya mengurangkan masa untuk meningkatkan produk sarung tangan.

Ke arah automasi dan digitalisasi, kami juga telah menghasilkan sebuah sistem pemeriksaan dalam talian bagi sarung tangan yang rosak. Sistem ini berfungsi untuk mengurangkan pergantungan tenaga pekerja dan meningkatkan kecekapan proses pemeriksaan. Sistem simulasi robotik R&D kami juga mempercepatkan proses penyelidikan melalui sistem pengaturcara yang membolehkan kami mensimulasikan pemprosesan produk sarung tangan dalam pelbagai jenis parameter.

Selaras dengan tanggungjawab kami terhadap alam sekitar, kami telah mengguna konsep ‘Tiada Sisa,’ yang melibatkan pengurusan proses untuk mengelakkan, memelihara, memulih dan menggunakan semula sisa untuk tujuan lain. Dengan itu, kami telah menghasilkan agen pembersihan mesra alam untuk mencuci bekas acuan, yang menggunakan air buangan dihasilkan daripada proses pembuatan sarung tangan. Proses inovatif ini bukan sahaja mengurangkan kos pengeluaran tetapi juga terbukti lebih berkesan untuk memanjangkan hayat acuan tersebut.

Top Glove bekerjasama dengan peguam-peguam dan ejen hak milik intelektual (IP) untuk menguruskan proses pemfailan dan permohonan IP, ke arah melindungi hak milik intelektual dengan betul. Setakat akhir TK2018, kami berjaya memfailkan 84 paten dan aplikasi paten di peringkat tempatan dan antarabangsa termasuk 22 paten diberi. Top Glove juga telah memfailkan 42 tanda dagangan dalam pelbagai kelas dan 5 reka bentuk perindustrian peringkat tempatan dan antarabangsa.




MASA DEPAN

Walau membentangkan pelan perkembangan kami untuk tahun-tahun yang akan datang, Top Glove sedar akan potensi cabaran termasuk kenaikan kos dan persaingan yang semakin sengit. Namun, kami tetap yakin pada jangkaan industri dan permintaan yang akan terus berkembang dengan sihat sebanyak 10% setahun.

Sementara perang perdagangan antara Amerika Syarikat dan China mungkin dianggap sebagai faktor keprihatinan kepada komuniti perniagaan, kami percaya kesan terhadap perniagaan kami adalah minimum kerana industri kami mampu bertahan disebalik ketidakpastian politik dan ekonomi. Namun, kami akan mengawasi dengan teliti perkembangan mengenai perang perdagangan ini dan harap bahawa perniagaan akan terus berkembang dengan bebas tanpa dikenakan sekatan.

Pada fajar Malaysia baru, kami terus menyokong usaha-usaha kerajaan demi membebaskan Malaysia dari semua amalan rasuah, ke arah persekitaran yang lebih mesra perniagaan. Kami juga harap krisis air di Selangor dapat diselesaikan sepenuhnya dengan segera untuk kebaikkan rakyat dan komuniti perniagaan.

Kami juga ingin memperluaskan jejak kami ke Vietnam, setelah mendapat kelulusan daripada pihak berkuasa pelaburan Vietnam.

Walau kami sedar bahawa cabaran akan selalu ada, pendekatan kami adalah dengan sentiasa memberi tumpuan kepada perkara-perkara yang berada dalam kawalan kami, berbanding faktor-faktor di luar kawalan kami. Selaras dengan Arah Perniagaan kami untuk menghasilkan sarung tangan berkualiti tinggi dengan kecekapan kos yang rendah, kami percaya dengan inisiatif-inisiatif penambahbaikan dalaman, kami akan berada dalam kedudukan yang baik untuk mengatasi sebarang halangan dan kekal ke arah untuk mencapai matlamat perniagaan kami.

PENGHARGAAN

Bagi pihak Lembaga Pengarah, kami ingin mengucapkan ribuan terima kasih kepada para Top Glovers untuk tahap dedikasi mereka, yang tiada tandingannya. Sumbangan anda telah menghasilkan kejayaan gemilang yang kami nikmati hari ini dan kami gembira dapat berkongsi pengembaraan untuk mencapai agenda pertumbuhan Syarikat bersama-sama anda.

Kami juga ingin meluahkan penghargaan kepada para pemegang saham, pelanggan, vendor dan rakan perniagaan kami atas sokongan teguh dan keyakinan berterusan anda terhadap Kumpulan. Kami harap dapat memperkukuhkan lagi hubungan kita pada tahun-tahun yang akan datang.

Akhirnya, kami ingin mengucapkan terima kasih kepada para ahli Lembaga Pengarah atas bimbingan dan komitmen anda dalam usaha untuk memajukan Top Glove ke peringkat seterusnya.

Dalam setiap penetapan matlamat yang besar, akan datangnya cabaran. Namun, kami yakin dengan sokongan daripada pasukan yang berdedikasi dan semangat Top Glove, kami berada di kedudukan yang baik untuk mencapai matlamat-matlamat ini.

Terima kasih.

TAN SRI DR LIM WEE CHAI DATO’ LEE KIM MEOWPengerusi Eksekutif Pengarah UrusanTop Glove Corporation Bhd Top Glove Corporation Bhd31 Oktober 2018 31 Oktober 2018

Top Glove dianugerahi Anugerah Merit untuk Pembentangan Tadbir Urus Korporat Paling Meningkat dan Kecemerlangan Industri untuk Pengeluaran oleh Minority Shareholders Watch Group




创下新高纪录的一年

致权益持有人及管理层讨论与分析的信函

诸位权益持有人，

2018财务年对于顶级手套是非常振奋的一年，这一年有多项积极的发展。

对集团而言，2018财务年再次为集团创下另一个记录，取得了卓越的财务业绩。集团正稳步地有机扩展，同时也成功完成了多项并购活动并为集团带来了协同机会。这包括了对稳利私人有限公司及DURAMEDICAL私人有限公司的收购，分别使集团成为了全球最大的手术手套制造商以及让集团进一步迈向医疗保健相关产品的领域。我们的安全套工厂也已开始营运，增强了集团的非手套产品系列。此外，集团亦提升了人力资源管理平台，以配合未来的增长宏愿。集团卓越的经营认可及良好的公司治理，为集团获得了多个奖项，同时也被列入数个著名的指数。

最高全年营业额

马币42亿

最高全年净利润

马币4亿3800万

最高季度营业额

马币12亿(2018财务年第4季度)

最高全年销售量

490亿只手套

集团非常荣幸能在充满挑战的市场环境中创下了历史新高，取得最佳的全年业绩。

LETTER TO STAKEHOLDERS : MANDARIN VERSION

顶级手套2017/2018年最佳员工得奖者

顶级手套于2018财务年的营业额达马币42.1亿，成功突破了40亿的门槛，与2017财务年相比增长了23.6%。此外，税前利润亦处于马币5亿2860万的新高，相比2017财务年大幅度上升了37.3%，双双创下历史新高。同时，销售量达到顶峰，与上一财务年相比增长了26%。于2018财务年，集团以马币12亿成功为其第4季度创下史上最高的季度营业额。

集团卓越的业绩归功于内部不断地追求改善，特别是应用先进技术，提升产品质量及有效地改进成本效率，同时亦减少了人力的需求。与此同时，营业额的提升主要是因为各类手套需求量强劲增长，并且凸显手套于医疗行业中不可或缺的地位、日益严格的保健需求及全球医疗保健意识的提升。

在2018财务年，集团的原材料价格有起有落。与2017财务年相比，天然乳胶的价格下滑了21.7%至平均每公斤马币4.51，而丁腈乳胶的价格则处于上升趋势，增长了2.7%至平均每公斤美元1.13。然而，集团能通过提高手套的平均售价，抵消丁腈乳胶价格的上升。基于集团均衡的丁腈及乳胶产品组合，天然乳胶价格的下降亦为集团带来了益处。同时，顶级手套亦有能力通过成本转嫁，减轻逆境所带来的影响，其中包括了美元的贬值及天然气关税的增长。


F15 慈善事业（帮扶贫困农村）

与此同时，位于泰国及中国的业务持续地为集团带来积极的贡献，通过新增的产能及更高的使用率使营运效率提高。然而，随着中国的竞争日益激烈，许多手套制造商遵守法规或将其生产业务搬迁至不受该国对污染行业有着严厉执法的地区。

管理层讨论与分析

顶级手套2018财务年的营业额达至马币42.1亿，主要因为各种手套需求量的增长，凸显了维持全方位手套系列及均衡产品组合的重要性，并与全球需求量保持一致。值得一提的是随着稳利的加入，与2017财务年相比，手术手套的销售量提升了76%，包含了自2018年4月份并购稳利以来对集团5个月的贡献。

2017财务年销售量的26%增长来自于发达及发展中国家的各个地区。发展中国家的手套需求量相对较低但正迅速增加，销售量迅速上涨并占据了总增长数额的72%，而大部分订单来自乳胶手套。这主要因为医疗支出增加以

及卫生意识提升，再加上激烈的营销活动以应付新兴市场的需求量。亚洲地区（日本除外）的销售量提升58%，而东欧则增长39.6%。与2017财务年相比，中东地区及非洲地区的需求量明显开始增加从而使销售量处于上升趋势，分别为38.7%及35.3%。与此同时，在西欧等发达市场的销售量逐渐上升，尤其为丁腈检验手套，尽管其上升的比例较小。

乳胶手套（有粉及无粉）占了总营业额最高的百分率，即45%；而丁腈手套占了营业额的40%。虽然手术手套仅占了产品组合的2%，基于销售价格较高，而致使其营业额占据了总营业额的9%。

在手套强劲的需求量下以致于手套使用率提高，从而提升效率及利润率。加上集团于内部针对性的改进措施，有助于顶级手套于2018财务年取得有史以来最高的税前利润及营运盈利。

我们的销售量根据地区分类如下：

致权益持有人及管理层讨论与分析的信函LETTER TO STAKEHOLDERS : MANDARIN VERSION (继续)

丹斯里林伟才博士及潘斯里董秀美于华人农历新年的庆祝晚宴

OCEANIA

ASIA

EASTERNEUROPE

NORTH AMERICA

LATIN AMERICA

AFRICA

WESTERNEUROPE

西欧FY18 vs FY17

35.8%

北美洲FY18 vs FY17

1.6%

拉丁美洲FY18 vs FY17

21.8%

东欧FY18 vs FY17

39.6%

非洲FY18 vs FY17

35.3%

中东FY18 vs FY17

38.7%

亚洲（日本除外）FY18 vs FY17

58.0%

日本FY18 vs FY17

7.0%

于发达国家的强劲增长

销售量根据地区分类比较


2018财务年，根据地理分布的销售产品分类如下：

2018财务年根据地理分布的销售量

2018财务年，我们的销售产品组合（数量）及营业额如下：

a) 2014财务年至2018财务年销售产品组合（数量）

Africa

Japan

Middle East

Latin America

Asia ex Japan

North America

Europe

31%欧洲

3%非洲

25%北美洲

15%亚洲（日本除外）

11%拉丁美洲

8%中东

7%日本

0%

10%

20%

30%

40%

50% 48%

24%

20%

6%

2%

46%

28%

18%

6%

2% 2% 2% 2%

39%

32%

19%

8%

32%

20%

10%

31%

36%

20%

11%

FY2014 FY2015 FY2016 FY2017 FY2018

36%

丁腈手套

有粉乳胶手套

无粉乳胶手套

PVC手套 / TPE手套 /

CPE手套

手术手套

b) 2018财务年产品组合营业额

由于手套是医疗行业中不可或缺的物品，且目前尚无替代品，我们坚信未来全球手套需求量将持续稳步上升，并预计每年大约10%的增长率。此外，手套属于一次性用品，同时，随着卫生标准不断地提高及卫生条规逐渐严格并强制性使用手套，手套的使用量亦有望提升。H1N1 、禽流感和伊波拉病毒等健康威胁的出现使人们逐渐意识医疗保健的重要性，而防范的第一步即是开始使用手套。此外，人口老龄化使得人们较易被感染疾病并需要更多的医疗照顾，这大大提升了手套使用量。

顶级手套稳定和强劲的表现凸显了集团内部于以下领域进行持续性的发展措施：

i) 基础设施费用

• 天然气为了高效节能天然气，我们将资金投入于更高效的加热元件及特殊的隔热材料，并使用工程塑料替代金属。此外，我们亦改善热空气循环，并以最大限度地回收在生产过程中所产生的热能。为了确保一致的燃烧效率，我们观察燃烧过程中的排放物，也定期为燃烧设备进行维修。这减轻了天然气价格于2018年1月起上涨23.5%所带来的成本影响。

• 水目前集团进行节水项目包括了雨水收集、水源循环和自动化水源供应及操控。为了确保有足够的水源供应以应付日常操作，集团建立逆渗透处理厂（ROTP），首先处理由周围工厂所排放的废水，接着转化为清水，再引回工厂重复使用。这使每只手套的手套平均耗水量减少了15.7%。

• 电集团减少电源流失的措施包括了稳定电力质量、投资更高效的设备及定期维修配电系统。


TPE/CPE

Vinyl

Surgical

Powder-free latex

Powdered latex

Nitrile

1%TPE手套/CPE手套

40%丁腈手套

26%有粉乳胶手套

19%无粉乳胶手套

9%手术手套

5%PVC手套


ii) 自动化及数据化集团持续将其业务自动化，以减少对人力的依赖、改善成本及减少人为过失。此外，随着集团朝工业4.0迈进，集团专注于过程数据化以提高数据准确性及大数据的可追溯性。

iii) 减少停机全面地对重要的机械及设备实施预测性及预防性的维修措施，以最大限度地降低了突发停机的次数，从而确保持续操作并提升生产力。

工厂国家手套种类生产线数量年产量（只）

目前: 32间手套工厂所有 648 条 605 亿

扩充计划：手套

第32厂首阶段（2019年初）马来西亚丁腈 22 条 22 亿

第32厂第二阶段（2019年末）马来西亚丁腈 12 条 12 亿

第33厂新楼（2019年初）马来西亚丁腈 12 条 12 亿

第5A厂新楼（2019年末）马来西亚丁腈 20 条 20 亿

第8A厂首阶段（2020年初）泰国丁腈/乳胶 32 条 32 亿

第40厂首阶段（2020年中）马来西亚丁腈 22 条 22 亿

第41厂首阶段（2020年末）马来西亚丁腈 12 条 12 亿

总扩充 132 条 132 亿

截至2020年：36间手套工厂 780 条 737 亿

iv) 提升生产率为了提升生产力，集团专注于工程、结构及机械的突破性改进，以提高生产线速度。除此之外，其它举措包括提高加热及烘干的效率、更好的化学配方及流程控制，以及对表现不佳的生产线进行检修。固此，现有工厂的生产力在2018财务年增长了12%。

企业里程碑

有机扩展

为了确保集团有能力满足全球庞大的手套需求量及实现集团列入《财富》世界500强的宏愿，顶级手套将继续寻找扩展的机会。

我们的扩展蓝图如下：

顶级手套有机的扩展计划


顶级手套计划将业务扩展至越南，并签订了收购土地的合约，用于建设工厂，而此工厂预计在未来两年内投入运作。与此同时，顶级手套安全套生产设施已于2018年7月投入生产，目前处于等待认证的阶段。

F15 参加市政府举办的长跑活动泰国员工参与于泰国泼水节期间的庆祝活动


于收购方面：并购与合资

为了实现“顶级梦”，顶级手套将通过并购及投资于相关行业，持续有机地扩展，以便更快速及更有效地扩大业务。于2018年4月，顶级手套完成了对稳利集团（一家全球最大手术手套生产商之一）的收购，使集团成为了全球最大的手术手套制造商并为其扩大的客户群提供了更优质及更具成本效益的医疗手套产品系列。

配合集团进一步地多元化其医疗产品，我们亦收购了Duramedical私人有限公司（一家制造牙科卫生产品及运动带的公司），加上新增的安全套工厂，标志着集团开始进军其它橡胶相关的业务，这也是集团期许的发展目标。

此外，为了让顶级手套得以改善其供应链协调，以及为手套包装材料提供更好的成本和质量管理，集团亦收购了东方印刷有限公司（一家印刷及包装材料的制造商）。

不仅如此，为了提升成本效益，顶级手套与Fimatec达成了合资企业，主要生产研磨碳酸钙浆料（一种用于手套制造过程的原料）。

其他发展

此外，集团亦提出1送1比例发行红股的建议，于2018年10月10日召开的股东特别大会上提呈与批准，并于2018年10月29日完成。此股东特别大会亦通过了一项债券发行协议，以筹集资金偿还银行借款，以及修改公司章程以促进发行红利的红股。

为了实现对股东的承诺，董事会建议派发每股5仙的终期股息，而此建议将于2019年1月召开的股东常年大会中提呈与批准。这将使全年总派息为8.5仙，相比上个财务年增长了1.25仙，而净利润派息比率则为50% 。

顶级手套获得了由马来西亚橡胶出口促进会（MREPC）颁发的2018年最具创新奖及2018年出口卓越奖，以表彰其卓越的产品。此外，顶级手套也被HR Asia 评为2018年亚洲最佳公司之一。另外，顶级手套也被纳入MSCI全球标准指数，并保持于富时4Good 指数，这全都归功于其强劲，持续增长和良好的公司治理。

为了进一步加强其人员流程，集团也投资于 S A P SuccessFactors以便改善其人力资本管理（HCM）平台，以吸引及引进合适的人才。

建立一个良好企业

集团时刻铭记我们的责任，不仅仅是为我们的股东带来效益，更为我们的社会带来更好的发展。因此，即使我们制定业务扩展及追求更大的目标，最主要的考量还是确保集团的发展不会对社区或环境带来负面的影响。

集团的可持续发展声明中提到了我们对环境、社会及经济方面的三大可持续发展支柱的职务，请参考第48至59页。

研发与技术的进步

我们的专业研发中心负责推动顶级手套的研发及创新计划。自2013年成立以来，此中心的设施及人力方面迅速的扩张，凸显研发对顶级手套的重要性。该研发团队总人数为151名（截至2018年8月31日），目前有86 名研究人员，包括了16名博士、19名硕士和47名学士学位。此外，集团也投入资金以提供研发中心最新的分析和表征仪器，如SEM-EDX、HPLC机GCMS。

我们的研发计划能让新的想法及概念转化为可推出市场的产品，如：GripPlusTM丁腈检查手套、CPE双纹理手套及无增速剂的潮湿丁腈手套。集团亦努力确保新研发的产品符合严格的国际指令及法规。此外，集团也投资在产品认证，以获得FDA’s 510（k），化疗药物测试，改良的Draized-95测试等等的认证。顶级手套也通过了ISO9001及ISO13485的认证，以确保我们的产品符合了GMP的要求。顶级手套将持续专注于产品创新，以确保集团得以在全球舞台上保持相应性及竞争能力。

为了保持市场反应，我们也正追求过程创新。因迅速的技术进步、不断发展的工业标准及不稳定的原材料价格已明显增加了市场上的竞争，这对于此行业而言尤为重要。

2015年，顶级手套推出了一个内部手模维修服务，以提升该领域的成本效益。相比前段日子，手模的维修交于外包商，而如今集团内部能够完成这项工作，得以省下购买新手模的费用及将手模送往维修所需的时间。顶级手套亦投资了约马币700万，开发一种再生产的方式修复手模，从而减少了购买新手模的需求，并降低了每月马币200万的成本。目前为止，已设立了7个手模维修设施，其中五个位于马来西亚，另两个位于泰国。

集团成立了一家化学分散剂厂，作为内部的化学分散用途，如：功能化增强剂、乳胶分散稳定剂和固化剂。该工厂能快速改良手套配方，以有效的成本满足市场需求，同时提升手套一贯性的质量，并缩短手套产品的交货时间。

迈向自动化及数据化的过程中，集团还发明一个在线缺陷手套检测系统。这有助于减少对于人力的依赖并提升手套检验过程的效率。研发中心的机械人仿真系统也通过编程系统加速研究过程，以模拟不同参数的手套产品制造过程。

为了符合集团对环境的责任，集团采纳了“零废弃物”的概念，在管理过程中防止、保存、回收及再使用其废弃物于其他用途。考虑这一点，集团研发了以在手套制造过程中产生的废水制造而成的洗涤清洁剂以在线洗涤手模。这创新的过程不仅降低了生产成本，也证明了可以更有效地延长手模的保质期。

顶级手套与经验丰富的知识产权律师和代理商合作，以管理知识产权申请和申请流程，以妥善保护其知识产权。截至2018财务年，集团成功于本地及国际提交了84项专利及专利申请，其中包括了22项授权专利。此外，集团亦于本地及国际提交了42个多级别商标及5个工业设计。



展望未来

虽然集团能预计未来几年的增长，管理层对未来可能面临的挑战保持警觉，包括成本提升及竞争加剧。尽管如此，我们仍对行业前景充满信心，手套需求量将每年以10％健康地增长。

中美之间的贸易战也许是商业界关注的一个焦点，但我们认为，此战对我们业务的影响微乎其微，因我们的领域与政治及经济的关联不大。然而，我们仍时时关注此领域的发展并希望在没有实施制裁的情况下，企业能够自由蓬勃发展。

展望一个全新的马来西亚，我们继续全力地支持政府的反腐运动，使马来西亚摆脱各种形式的腐败行为，迈向更加商业化的环境。此外，我们也希望雪兰莪的水供危机能迅速解决，以为人民和商界带来益处。

集团也希望在获得越南投资当局的批准后，将其足迹扩展至越南。

虽然我们意识到挑战时时存在，但我们始终关注于我们所能控制的范围内，而非无法掌控的外来因素。随着集团持续推行内部改善措施，并配合集团的商业方针：以低成本生产高质量手套，集团相信我们将有能力克服种种障碍，坚持不懈地往我们的商业目标迈进。

感言

我谨代表董事会感谢顶级手套伙伴们无私的奉献精神。您积极的贡献促成了集团今天亮眼的成绩，我们很高兴能与您共同实现我们伟大的发展议程。

我们希望借此机会向我们尊贵的股东、客户、供应商及商业伙伴表示最深切的谢意，感谢您们对本集团一路以来坚定的支持和持续的信心。我们期望在未来的日子里与您有着更进一步的关系。

最后，我们也衷心感谢董事会成员宝贵的指导和承诺，带领顶级手套迈向成功。

我们为集团设立了庞大的目标，这无疑超越集团一般的目标。实际上，我们追求的变革性增长水平超出了我们的舒适范围。然而，我们坚信凭着您们衷心的支持和顶级手套一直以来不屈不挠的精神，没有我们无法实现的梦想，亦没有我们无法达成的目标。

谢谢。

丹斯里林伟才博士拿督李金谋执行主席董事经理顶级手套集团顶级手套集团2018年10月31日 2018年10月31日


顶级手套团队为了2018年Bursa Bull Charge慈善益跑整装待发


SUSTAINABILITY: THE WAY FORWARDAt Top Glove, creating value through sustainable practices ranks high on our corporate agenda.

We’ve always believed in doing well by doing good and remain committed to managing our business in a way that respects and contributes positively to the environment, resources and greater community.

MESSAGE FROM THE EXECUTIVE CHAIRMAN

Dear Fellow Stakeholders,

Welcome to our Sustainability Statement for FY2018, which builds on our maiden report issued in FY2017. In line with our commitment to continuous improvement, I am pleased to note we have stepped up both our sustainability practices as well as efforts to encompass broader and more in-depth reporting.

At Top Glove, we understand that our business does not operate in a vacuum. Our activities have the ability to impact lives and the communities we serve. As a corporate citizen, more so as an industry leader, we have a tremendous responsibility to ensure we impact our world positively. Hence, stewardship of our environment, resources and community is a responsibility we take very seriously.

In preparation for our maiden Sustainability Report in FY2017, we embarked on a materiality assessment with an independent consultancy. It was a thorough process during which we engaged key internal stakeholders to identify sustainability issues for the organisation under our 3 pillars of sustainability: Environmental, Social and Economic. These issues have since been validated and approved by the Board and are depicted in our Materiality Matrix on page 49.

As with FY2017, Environmental and Social themes remain high priority indicators for us in FY2018. Accordingly, throughout this report, we present metrics reporting on our performance and progress towards our sustainability goals in terms of the material matters subsumed under these two important categories. As we progressively deepen our reporting efforts, we have alsoidentifiedcontentfortheEconomicaspectaswell.

As a growing and dynamic company, we remain mindful that it is not just about selling more gloves but doing so in a way that respects both people and planet. We believe it is not a right but a privilege for us to do business in society, and count it an honor to be a part of creating a better future and leaving a positive legacy for the world we work, play and live in. Not just for us but for future generations to come.

Our pursuit of sustainability is an ongoing journey, for which we can never say that we have truly arrived. AccordingIy, we assure you that we will keep raising the bar and asking ourselves how we can do better, to ensure that we continue to meet the high-quality standards that you have come to expect of Top Glove.

TAN SRI DR LIM WEE CHAIExecutive ChairmanTop Glove Corporation Bhd

SUSTAINABILITY STATEMENT


Materiality Matrix for Top Glove

Internal Stakeholders

Note: All information mentioned is based on Malaysian operations only unless stated otherwise

i. A Robust Environmental Policy

ENVIRONMENTALWe believe environmental sustainability is as important as business sustainability. As the world’s largest manufacturer of gloves, a foremost business priority is to responsibly manage our carbon footprint to which end, we have undertaken several initiatives in the following areas:

ENVIRONMENTAL MANAGEMENT AND COMPLIANCE

EnvironmentalA EmissionsB Waste & EffluentC Water ManagementD Energy EfficiencySocialE Supply ChainF DiversityG ComplianceH Labour PracticesI Human RightsJ CorruptionK Product Services ResponsibilityL Security ManagementM Occupational Health & SafetyN Talent ManagementEconomicalO Procurement PracticesP Community InvestmentQ Indirect Economic Impact

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ii. Environmental Management System (EMS)

ALL FACTORIES MAINTAIN ENVIRONMENTAL MANAGEMENT SYSTEM BASED ON ISO14001 FRAMEWORK

Three of our manufacturing plants (Factory 12 in Klang, Factory 5 and 23 in Ipoh) are ISO14001:2015 EMS certified and we continue to evaluate the suitability of our remaining facilities for future certification. We target to certify another 3 factories in 3 years as the duration for the certification process is extensive. In tandem, for all non-certified factories, Top Glove maintains an EMS based on the ISO14001 framework as well as industry best practices, thereby ensuring a standardised and systematic workflow throughout all areas of our operations.

The efficiency and environmental performance of the EMS is continuously evaluated and improved on yearly, to ensure we maintain our certification and update/upgrade accordingly based on the ISO requirement. Other standard operating procedures throughout our manufacturing sites are assessed through monthly spot-checks and annual internal audit programs conducted in preparation for official certification/surveillance audits by external parties, such as SIRIM.

SUSTAINABILITY STATEMENT(CONT’D)

To comply with all relevant regulatory, statutory and applicable requirements.

To proactively prevent environmental pollution via an established Environmental Management System (EMS).

To implement efficient environmental initiatives promoting sustainability.

To systematically promote and provide education and training on environmental protection and responsibilities across all levels within the Company.

An extract from THE TOP GLOVE ENVIRONMENTAL POLICY 2018


In 2018, Top Glove generated approximately 0.092 kg of hazardous waste per carton of gloves, primarily end products from the wastewater treatment processes. Moving forward, we aim to maintain the average hazardous waste generated.

v. Product Innovation

RM150,000 INVESTMENT IN R&D FOR DEVELOPING GREEN PRODUCTS

To ensure we continue managing our waste well as our operations expand, a total of RM10 million has been invested in R&D for product innovation, RM150,000 of which is specifically for developing green products.

BIODEGRADABLE (ACCELERATOR-FREE) GLOVES AVAILABLE IN FY2019

In a move towards preserving the environment, we have also developed the new “BioGreen” Biodegradable (Accelerator-Free) Nitrile Examination Glove which is designed to biodegrade in both anaerobic and aerobic conditions at landfills. Through Biomethane Potential Testing (BMP), the glove has a proven 21% biodegradation rate in a span of 66 days under accelerated condition. The ambidextrous glove provides an “end life solution” for both landfill and recyclability to reduce accumulation of solid waste. This product is also accelerator-free, specially formulated to minimise Type I and Type IV allergies while providing a high level of barrier protection similar to those not exceeding the conventional Sulphur and accelerator cross-linking system. This product is targeted to be launched in FY2019.

Our aim is for accelerator-free and biodegradable accelerator-free gloves to comprise at least 20% of our glove product portfolio by 2030.

BIODEGRADABLE CPE GLOVES AVAILABLE BY END OF FY2019

Currently, Top Glove’s CPE gloves are 100% recyclable but not biodegradable. By end 2019, we target to develop CPE gloves that are bio-based and biodegradable which conform to ASTM D5511 standards and bio-methane potential (BMP) testing for biodegradability, as well as ASTM D6866 for bio-based content.


UP TO

RM2 MILLION INVESTED IN IETS FACILITIES

We are actively exploring innovative technologies to improve our existing facilities, which range from the upgrading of existing water recycling processes to the automated sampling and monitoring of effluent discharges.

iii. Compliance with Malaysian Department ofEnvironment requirements

Effluent Discharges

99% COMPLIANCEACHIEVED BY ALL FACTORIES

In FY2018, Top Glove achieved 99% compliance in terms of effluent discharges amongst all factories. On-going efforts are in place to ensure our factories remain compliant such as regular training programs for employees, as well as more automation and digitalisation initiatives, which include an online monitoring system that enables us to keep track of our effluent discharge parameters at any given moment.

Prior to being released into the environment, effluent discharges are monitored and assessed daily in dedicated on-site laboratories.

All manufacturing facilities within Top Glove have their own on-site wastewater treatment plant. Wastewater generated from the glove manufacturing process is channeled to our wastewater treatment systems, where the contaminants are concentrated into sludge and clean treated water is discharged into the environment. As an added assurance, water quality analysis is also conducted twice monthly by an accredited third-party laboratory.

iv. Waste Management

We have in place Standard Operating Procedures(SOPs) to ensure the best possible measures aretaken throughout all our facilities to reduce anyadverse environmental impacts arising from thedischarge of waste.

All hazardous waste generated from ourmanufacturing processes are sent to a DOElicensed hazardous waste recycling facility,where the waste is recycled or converted intoenvironmentally-friendly products. Regularcompliance and evaluation audits are alsoconducted to ensure the integrity of these licensedfacilities.


MOISTURISING NITRILE EXAMINATION GLOVESTO BE LAUNCHED IN FY2019

Top Glove’s moisturising nitrile examination glove is dermatologically tested and suitable for users with dry and itchy skin. With kind-to-skin ingredients such as almond oil and vitamin E, it helps to protect, improve and provide long lasting hydration during use. The accelerator-free variant of the glove, helps to minimise risk of Type IV delayed allergic contact dermatitis.

INTELLECTUAL PROPERTIES (IP)

Our IP filing is as follows:

Type of IP

The 2 green patents filed were for Top Glove’s CPE and TPE gloves. The CPE and TPE gloves produced by Top Glove are more environmentally-friendly with zero discharge or emissions to the environment, as compared to latex or nitrile gloves. In addition, less chemicals are used, resulting in minimal material wastage (defective gloves are recycled into raw materials) and wastewater generation. The machines for CPE gloves are also designed with minimal noise generation and the workers will not experience heat stress from drying or curing processes in the CPE and TPE glove production. These gloves are clean and safe to be used in food handling.


ENERGY EFFICIENCY

i. Gas consumption

MORE THAN 20% REDUCTION IN GAS CONSUMPTION (PER CARTON OF GLOVES) OVER 2 YEARS (FY2017 & FY2018)

Natural gas is the primary energy source used in the glove manufacturing process, mainly for oven and tank heating. Our gas saving initiatives are focused on drying efficiency, heat recovery, heat loss and heating element efficiency. These have enabled Top Glove to achieve 19.4% energy savings (per carton of gloves) compared with 8.1% in FY2017.

9.5% REDUCTION INCARBON DIOXIDE EMISSIONS FOR FY2018 (PER CARTON OF GLOVES) COMPARED WITH 2.99% IN FY2017

In financial year 2018, our gas consumption was at 16.98kg carbon dioxide emissions per carton of gloves produced, which has since reduced by 9.5% as compared with FY2017. Our target is to reduce carbon emissions by 8% annually. To achieve this, we aim to have higher efficiency heating elements, special heating insulation, replace metals with engineering plastics, improve hot air circulation and recover usable heat. We will also continue to monitor our combustion equipment and ensure monthly maintenance is conducted.

ii. Water

RM15 MILLION INVESTMENT IN INFRASTRUCTURE AND EQUIPMENT FOR REVERSE OSMOSIS WATER TREATMENT PLANT

To ensure that an adequate supply of water is available for everyday operations, we invested close to RM15 million in the infrastructure and equipment for a Reverse Osmosis Treatment Plant (ROTP). The ROTP treats wastewater discharged from the surrounding factories to produce clean water, which is then channeled back into the factories for reuse in production.

Total filing as at FYE2018

Patent

84 patents and patent applications filed locally and internationally including 22 granted patents and 2 green patents

Trade mark (TM)

42 TM’s in multiple classes locally and internationally

Industrial Design (ID)

5 ID’s locally and internationally


LINEAR REDUCTION OF

14.9% PER CARTONOF GLOVES

Water consumption per carton of glove saw a linear reduction of 14.9% equivalent to a reduction of 55.2 litres of water consumption for every carton of gloves produced in FY2018. Other ongoing water saving projects include rain water harvesting, water recycling and automation for water supply.

iii. Electricity

2.5% ELECTRICITYSAVINGS (PER CARTON OF GLOVES)

Towards minimising energy wastage, efforts in the area of stabilising electrical power quality, investment in higher efficiency equipment and regular maintenance of electrical distribution systems are carried out. In the pipeline are also other new initiatives as well, such as power supply optimisation.

SOCIALWe believe engaging and nurturing our people is one of the most effective ways to ensure our business continues to grow healthily. To this end, Top Glove has implemented people-focused policies and practices, so as to create a safe and harmonious environment, conducive both for career and personal growth. We pay particular attention to the following areas:

SAFETY AND SECURITY

In FY2018, the incident and severity rate saw a slight increase compared to FY2017.

The total incident rate saw an increase from 2.31 cases /1000 employees to 3.82 cases/1000 employees in FY2018. Whereas the severity rate increased from 14.05/million hours worked with average lost time injury of 15.2 days/accident in FY2017 to 21.29/million hours worked with average of lost time injury of 13.9 days/accident in FY2018. However, there were no fatality cases reported within this period.

To mitigate this, we will continue to prioritise safety at the work place by increasing safety awareness initiatives and trainings including conducting daily spot checks for all potential hazards that can lead to accidents, and increase safety enforcement to all staff and workers in order to prevent accidents.


In addition, we will establish a more structured safety training module to ensure the effectiveness of trainings conducted for staff and workers. We will also increase the emphasis on Safety Operating Procedure training for experienced and new workers in order to increase their awareness and competence.

i. Harmonised Integrated Management System

Towards standardisation across Top Glovemanufacturing facilities, we are in the processof consolidating our internal health and safetysystems into a single combined HarmonisedIntegrated Management System which will berolled out to all factories in Malaysia by December2018.

ii. Fire Safety Training

15 FACTORIES COMPLIANTWITH BOMBA FIRE SAFETY STANDARDS

Our Emergency Response Team (ERT) has been trained by the Fire and Rescue Department of Malaysia (BOMBA) and are well-prepared for emergencies. As a result, BOMBA awarded Fire Certificates to 6 of our Malaysian factories while 9 of our factories received exemption letters, certifying they are safe to occupy and do not require fire certificates due to design and size. We continue to ensure the remaining factories adhere to internal fire safety practices.

For FY2018 as with previous years, we have conducted fire drills for all locations including our corporate headquarters, Top Glove Tower in compliance with BOMBA requirements. In FY2018, Factory 19/20 specially conducted a fire drill with BOMBA in May 2018 while other factories are scheduled to hold theirs starting October 2018.

iii. Control of Industrial Major Accident Hazards(CIMAH)

As a dynamic and growing company, Top Glove’s manufacturing process consumes a significant level of chemicals. In compliance with the Occupational Safety & Health Act (OSHA) 1994 and CIMAH Regulations, we recently renewed the CIMAH report and submitted an Industry Activity and Emergency Preparedness report to the Department of Occupational Safety & Health (DOSH HQ) at Putrajaya and Selangor which requires updates on the company’s operations every 3 years.

To ensure we are well-prepared for emergencies, programs are also conducted with residents within close proximity of our factories to keep them informed on our company’s activities, as well as preparations in case of emergencies.


We have also collaborated with the BOMBA Hazmat team who have both trained and shared their knowledge with our team.

iv. Road Safety Programs

We organised a Road Safety Campaign in March2018, in collaboration with Jabatan KeselamatanJalan Raya (JKJR), Fire Department (BOMBA),Jabatan Pengangkutan Jalan (JPJ) and HospitalTengku Ampuan Rahimah (HTAR). Activitiesheld during this campaign include Road SafetyAwareness talks, demonstrations by BOMBAand information booths by various governmentagencies.

v. Ongoing initiatives

We also have ongoing efforts to increase safetyawareness through talks, workshops, anddemonstrations as well as safety measures takensuch as 24-hour security and ensuring compliancewith safety laws.

We encourage employees to declare unsafeacts and/or conditions (UAUC) to the safetydepartment. From the UAUC statistic compiled,we can then take necessary measures to improvesafety and prevent any occurrence of accidents.

vi. Cybersecurity

85% REDUCTION ININVOICE FRAUD CASES FROM 2014

Top Glove and our customers, vendors and business partners have not been spared the global problem of phishing scams. These refer to the use of social techniques to gain information pertaining to individual user identifications and passwords to various systems, emails in particular. In Top Glove’s case, we have seen this resulting in “man-in-the-middle” compromises, leading to invoice fraud and monetary loss.

No.

of c

ases

Amou

nt (U

SD)

Financial Year2014 2015 2016

1312

6

4

2

2017 2018 2019

14

12

10

8

6

4

2

0

700,000

600,000

500,000

400,000

300,000

200,000

100,000

-

Invoice Fraud Cases from FY2014 to FY2018


Amount (USD) Cases

In FY2018, we encountered 2 such fraud cases amounting to a loss of USD 6,000, which is a significant reduction compared to 13 fraud cases amounting to a loss of USD 577,000 in 2014.

We will continue to address the occurrence of fraud cases. To which end, Top Glove has invested in IT security systems and the development of cybersecurity policies and procedures that comply with best practices. In addition, we have intensified effort to educate stakeholders on the importance of cybersecurity.

CORPORATE WELLNESS

The well-being of our employees continues to be one of the main priorities of our unique health-centric culture. Underscoring the importance of employee welfare, we have in place numerous initiatives aimed at increasing health awareness levels amongst our employees.

1. Health and wellness initiatives

i. Top Glove Breakfast Day 2018

To inculcate the habit of having a healthybreakfast, employees were treated to a healthier version of Nasi Lemak, a popular Malaysianbreakfast dish during the program which tookplace in January 2018.

• Low fat milk used for the rice (to replacesantan)

• 1 tablespoon of sambal bawang with less oil• 1 teaspoon of fried anchovies and peanuts• More cucumbers• A choice of 1 hard-boiled egg or tofu

(vegetarian)

for Top Glove’s healthier version of nasi lemak


ii. “Eat Less, Move More” Workshops

A series of “Eat Less, Move More” Workshops,encouraging employees to eat healthy portions inaccordance with the Malaysian Healthy Plate, aswell as to stay physically active, was also conducted throughout all Malaysian factories with a total of 27sessions completed within the financial year.

The Malaysian Healthy Plate is based on the “suku suku separuh” guideline, comprising a quarter portion of carbohydrates, a quarter portion of protein and a half portion of fruits and vegetables

iii. Educational talks and visits

We organised an Educational Visit to the DialysisCentre aimed at kidney disease awareness andprevention, as well as workshops on Diabetesand Hypertension as a health interventioninitiative for a focused group of at-riskpersonnel.

iv. Health Day at newly acquired facilities

Health Day was held at our newly acquiredfacilities Eastern Press (Factory 34) and Aspion(Factories 36, 37 & 38) to introduce our newcolleagues to Top Glove’s wellness initiativesand culture of good health. Activities conductedincluded basic health screening on BMI, bodyfat and muscle percentage, blood pressure,blood sugar, as well as talks on leading ahealthy lifestyle.

v. Healthy Food Competition

A Healthy Food Competition was organisedamong Top Glove Canteens in Klang, Malaysiato encourage preparation of healthier meals,with the winning dishes introduced to thecanteen menu.

vi. Hand Hygiene campaign

We also organised a Hand Hygiene Campaignto educate Top Glove’s Canteen Operators onproper hand cleaning guidelines in addition tothe introduction of using serving trays whileeating to improve canteen cleanliness.

vii. Maintaining existing initiatives

We continue to maintain and enhance ourexisting health practices such as monthlyhealth talks, Malaysian Healthy Plate menu forbirthday and training meals, monthly Fruit Dayand canteen inspections.

Our comprehensive Monthly Health TalkTopics include:

Importance of Vaccination

Oral Health: Mouth Problems

Oral Health: The Smile Makeover

Foot and Leg Trauma

Healthy Working Mother (Pregnant & Breastfeeding Women Wellness)

Women Wellness (Endometriosis)

Diabetes Mellitus Type 2

2. Dental Health

ABOUT

RM195,000 INVESTMENT IN FY2018 FOR DENTAL CARE

Top Glove provides complimentary dental kits for all employees, as well as visitors and guests. Annual expenses for this initiative amounted to RM 194,580 in FY2018 compared to RM189,485 in FY2017, attributed to the increase in employees resulting from newly built facilities as well as our recent expansions via acquisitions.

In FY2018, the company also established its own Top Glove branded Dental Kit consisting of toothbrush, toothpaste, tongue cleaner and dental floss. This in turn improved cost efficiency and brand awareness.

3. Research collaborations

In FY2018, Top Glove collaborated with UCSIUniversity through its subsidiary Top Glove GlobalDoctors Medical & Dental Clinic on a dental healthand nutrition study among employees with a highBMI score.

The research found that there was a markedlylower intake of fruits and vegetables amongthis group of employees which correlated witha prevalence of dental caries. These findingshave helped direct efforts to raise awarenessand promote higher consumption of fruits andvegetables amongst this specific group.



4. Downtrend in the number of employees withHigh BMI

DECREASE IN OVERWEIGHT AND OBESE EMPLOYEES

Percentage of employees with high BMI

17% 14.41%FY

2018FY

2017

Employees with BMI 25 kg/m² and above

Employees with BMI below 25 kg/m²

Top Glove measures the BMI of its employees every quarter. In FY2018, 14.41% of employees fell under the overweight and obese category (BMI 25 kg/m² and above) which is about 15% lower than FY17. The percentage of overweight staff in Top Glove is also significantly lower compared with the Malaysian average of 47.7% (NHMS 2015 data).

5. Average man-days lost/month due to sickleave

0.72% 0.78%

FY2018

FY2017

Man-days lost per month

Working man-days

The average for man-days lost per month in FY2018 increased marginally to 0.78% compared to 0.72% in FY2017 owing to an enhancement in the data extraction method which generated data with higher accuracy.

The reason for most cases of prolonged medical leave was accidents, either workplace, household or motor-vehicle related, while common acute sicknesses such as fever, cold, Upper Respiratory Tract Infection (URTI) mainly accounted for sick leave. We are aware of the need for more safety awareness and accident prevention measures and are working towards implementing more effective wellness programmes.


6. Employee health score

EMERGED HEALTHIESTEMPLOYEES (LARGE ORGANISATION) IN AIA VITALITY MALAYSIA’S HEALTHIEST WORKPLACE AWARD 2017

In FY2018, Top Glove participated in AIA Vitality Malaysia’s Healthiest Workplace Award 2017, and emerged winner in the Healthiest Employees (Large organisation) category in November 2017.

The personalised survey report which Top Glove received from AIA Vitality reported a high level of participation by employees in nutrition and physical activity interventions, and which positively impacted their health. This is indicative of the effectiveness of our programs which focus on healthy eating and an active lifestyle.

Top Glove saw 98.4% participation in at least one nutrition intervention (of those who are aware), which is significantly higher than the country’s 94% benchmark. 82.4% of participants also felt the interventions positively impacted their health.

However, the report also revealed areas in which there was room for improvement in terms of psychological well-being. Survey findings reported that 56% of the respondents are subject to at least one dimension of work-related stress, with overall depression and anxiety risk profiles among employees higher than the country’s benchmark. However, Top Glove scored well in other areas such as health facilities and nutrition.

We note the survey results are not an accurate representation of the average employee’s health score as the percentage of survey respondents comprises just 1.2% (157 people) of Top Glove’s 13,000 employees (as at August 2017). Nevertheless, the total well-being of our employees continues to rank high on our business agenda and to address the concerns raised, we are already looking into programs to improve outcomes in these areas, such as sports tournaments amongst employees and collaboration with healthcare professionals that focus on stress management.

GROWING OUR TALENT

Our success would not have been possible without the many contributions of our people. Our HR mission statement, “To ensure our employees are performing now and prepared to perform in the future” continues to drive our initiatives in creating an engaged and inclusive work culture that focuses on quality for an increasingly competitive business market. As an equal opportunity employer, we embrace diversity in terms of ethnicity, age, gender, race and cultural background towards better serving our customer base and community.


i. Embracing A Growing Multi-Cultural Talent Pool

17,000*TOP GLOVERS IN FY2018 30.77% INCREASE FROM FY2017

* Based on total group figures

At the close of FY2018 we were employer of choice to over 17,000* Top Glovers, a figure that has increased significantly by 30.77% from 13,000* employees in FY2017, following recent expansions both organically as well as via mergers and acquisitions. Ours is a diverse workforce, a substantial percentage of which comprises foreign workers. We respect the rights of our people and take a strong stand against discrimination of any kind at the workplace. Whenever we operate, we adhere to the socially ethical standards of employment practices and policies, and regularly communicate with our business partners to ensure they are aligned with our social compliance initiatives.

FY2017

FY2018

Local

Local

Non-Local

Non-Local

2,165* employees

9,033* employees

3,605* employees

11,575* employees

* Based on Malaysian Operations

ii. Cultivating A Diverse Workforce

Accordingly, our management team comprises a good balance of female and male employees. Technical roles, traditionally held by men are now also increasingly accorded to women.

Females In The Workforce (2018)

FEMALES

52% OFLEADERSHIP POSITIONS ARE HELD BY


Male

Male

Female

Female

54.1%

53.1%

FY 2017

FY 2017

Percentage of female employees

Percentage of females in leadership positions

FY 2018

FY 2018

52%

53.5%

The majority of our employees fall within the 20 to 35 age group, which consists of executives and managers. This age group saw a 7% increase from FY2017, following an increase in demand for talents due to rapid expansion. The company saw a slight decrease in age groups 36 to 45 and 46 to 60 by 5.5% and 2.3% respectively, as more younger executives take up leadership positions.

iii. Talent Management

a. Employee Engagement

INCREASE OF

23.3% INEMPLOYEE SATISFACTION SCORES

Total employees by age group

2017 2018

Below 20

20 to 35

36 to 45

46 to 60

Above 60

0.8%

74%

19.1%

5.7%

0.4%

1.6%

81.1%

13.6%

3.4%

0.3%



Ongoing efforts to encourage employee engagement and feedback include the annual Employee Satisfaction Survey. Based on responses garnered for FY2018, we observed a significant improvement in our overall employee satisfaction score, where 58.79% of our people rated their working experience in Top Glove as above average or one of the best as compared to 47.67% in FY2017. Our improved results are attributed to the company’s employee-centric initiatives and benefits including a regular review of our employees’ salary scale to ensure our remuneration package remains competitive.

Between March and May 2018, the management team also held several town halls at our recently acquired factories towards a smoother integration process for the businesses. Additionally, the Chairman and top management hold weekly birthday luncheons with employees, during which there are knowledge sharing sessions conducted by managers. Employees are also encouraged to submit monthly suggestions for improvement via an online portal.

Awards and recognitions

Certificate of ExcellenceHuman Resource Development Awards 2017 by HRDF Malaysia

Winner: Healthiest Employees by AIA Vitality 2017

Winner: Manufacturing - Chemicals & Heavy Industries by Malaysia’s 100 Leading Gradute Employers 2017, GTI Media

Best Companies To Work For In Asia 2017 by HR Asia

47.67%Above Average

FY 2017

Level of employee satisfaction

FY 2018

58.79%Above Average

In October 2017, Top Glove was named by HR Asia as 1 of 45 Best Companies To Work For, for the second consecutive year. Top Glove scored higher than the industry average particularly in employee engagement, workplace culture, as well as advancement and development opportunities. Top Glove also emerged winner: Manufacturing-Chemicals & Heavy Industries, rising to top 5 employers among Malaysia’s 100 Leading Graduate Employers. These recognitions continue to inspire us to do even better in our quest to deliver excellence for our employees.

Employee Turnover Rate (%)

12.30%

17.73% 17.76%

FY 2017(Top Glove)

FY 2018(Top Glove)

2017(Manufacturing

Industry Average)

While our employee turnover is on par with the market average, we note it has gone up by 5% as compared with last year. We believe a contributing factor for this is related to our rapid business expansion which requires adaptability on our talents’ part to transformative changes. We recognise that talents are the lifeblood of our company and will continue reviewing and strengthening our employee retention strategies and developing an agile workforce in the years to come.

b. Performance-Linked-Rewards

PRACTICE OF MERITOCRACY AND PERFORMANCE-BASED REWARDS

Employees are assessed against agreed-upon KPIs rendering our Performance Management System fair and objective. The system is structurally linked to various rewards, and performing employees enjoy incentives, ESOS/share grants as well as contributions to a Private Retirement Scheme Fund. Opportunities for career advancement are earned based on performance, which underlines the caliber of our pool of leaders.


c. Succession Planning

Top Glove Succession Plan Crystalised

In FY2018, we crystalised our SuccessionPlan, the first phase (identifying and assessingcandidates) of which has already beencompleted and resulted in a healthy ratio of 2:1Succession Bench Strength ie. 2 successors toevery 1 mission critical position. In the secondongoing phase, nominated successors areassessed in two areas: Potential and Top GloveLeadership Competencies. Thereafter for Phase3, candidates will undergo a robust IndividualDevelopment Plan (IDP) which consists of70% stretched assignments, 20% formal/informal coaching sessions and 10% coursedevelopment (the 70/20/10 DevelopmentModel), to ensure our successors receive thedevelopment they need.

d. Learning and Development

TARGETED AVERAGE LEARNING HOURS EXCEEDED IN FY2018

Talent development is one of the core aspects of the organisation’s continued growth and success. Underscoring the importance of continuous learning within the organisation, we increased the targeted learning hours per employee from an average of 32 hours in FY2017 to 36 hours in FY2018. In FY2018, Top Glove achieved an average of 39 learning hours/employee, exceeding the targeted learning hours set. However, the average training hours decreased by 9% compared to the previous financial year, attributed to an increase in employees from our recent acquisitions. To mitigate this, the Group has developed a number of new approaches in learning and development programmes such as:

i. DEVELOPED VIDEO-BASED LEARNING

We developed approximately 60 videos relating to work instructions to complement classroom training sessions. These enabled employees to learn at their own pace and in smaller groups without affecting daily business operations. The videos were also translated into Nepali, accommodating the majority of our foreign workers, in addition to having subtitles in Bahasa Malaysia and English.


ii. SPECIALISED R&D TRAINING TO ENHANCE JOB KNOWLEDGE

Specialised trainings were also conducted for the R&D team, who are charged with driving innovation initiatives within the company. In FY2018, we arranged for a series of R&D Capability Building Technical Programs and also enrolled them in various public programs and workshops to enhance job knowledge.

iii. INTERNAL TRAIN-THE-TRAINER PROGRAM

To strengthen our Learning & Development team, we also selected 20 internal candidates from various departments to undergo a 5-day development Train-The-Trainer program by Human Resources Development Fund (HRDF), starting them on their internal trainer journey. This is also in line with Top Glove’s Culture of Must Know, Must Do, Must Teach which encourages continuous learning and knowledge sharing among employees.

HUMAN CAPITAL MANAGEMENT SYSTEM TRANSFORMATION IN FY2019: TG REACH

The Company invested RM6 million in an SAP SuccessFactors HR System, to transform its human capital management system in order to better support its regional and global expansion. Named TG REACH, it comprises six modules namely Performance & Goals, Compensation, Learning, Recruitment, On-boarding, Succession & Development. The first module for TG Reach officially went live in early September 2018 with the implementation of the entire system expected to be completed within 14 months. In FY2019, Top Glove’s reward management will be reviewed and redesigned to ensure its competitiveness against market benchmarks.

COMMUNITY

Corporate responsibility continues to be an important focus of our business agenda. Our community outreach program encompasses education, environment, community welfare and charities, for which Top Glove Foundation contributed close to RM4 million for FY2018.

RM6 MILLIONINVESTED IN AN SAP SUCCESSFACTORS HR SYSTEM



A key area we aim to create value in is education, which we believe is the cornerstone of an advanced and progressive nation. Since the inception of Top Glove Foundation, it has offered 59 scholarships to students, for various degree courses in local public universities. Top Glove also donated to institutes for redevelopment and facility improvement projects such as Sekolah Rendah Jenis Kebangsaan (C) Chun Yin and Huaren Education Foundation.

In line with our commitment to give back to society, Top Glove also organises charitable visits and donations every year, especially during festive seasons in Malaysia such as the Lunar New Year, Eid Mubarak, and Deepavali. Different teams from Top Glove visited charitable associations namely Padmasambhava Children Loving Association Klang, Rumah Penyayang Hembusan Kasturi, and Chik Sin Thong Old Folks Home Klang.

Further adding value to the community, Top Glove also organised a blood donation drive across our factories, participated in charity runs, as well as performed maintenance works to resurface the road and clear the drainage system within the factories’ vicinity. We also sponsored 2000 cartons of gloves to St John Ambulance Malaysia and donated to 1MCA Medical Foundation.

ECONOMICAL

Top Glove is committed to upholding a good corporate governance framework that promotes fairness, transparency and accountability. Top Glove’s Business Ethics, of Honesty, Integrity and Transparency have shaped our culture over the years and we continue to manage our business based on these values. As the world’s largest manufacturer of gloves, we are cognisant of our immense responsibility to ensure we operate safely, responsibly, honestly, transparently and with integrity, which we believe is fundamental to our strong financial performance year after year.

CODE OF CONDUCT

On our website is the Director’s Code of Conduct and the Employee’s Code of Conduct reflecting the underlying shared values we uphold. The company also provides an avenue for Whistleblowing for office-based staff and workers, as well as the general public, for which there were no formal and reportable cases in FY2018.

TOP GLOVE PREVENTION AND ANTI-CORRUPTION COMMITTEE (TGPAC)

Reflecting our commitment to uphold integrity and prevent corruption in the conduct of our business and interactions with the government, we established the Top Glove Prevention and Anti-Corruption Committee (TGPAC) in 2009 headed by our Managing Director, Dato’ Lee Kim Meow.

The committee also aims to promote an anti-corruption mindset amongst Top Glove’s employees, as well as to provide an avenue for employees and the public to lodge complaints of any corrupt practices in the company.

TGPAC is also empowered to conduct investigations in the event of any corruption acts or bribery cases.

ISO 37001: 2016 ANTI-BRIBERY MANAGEMENT SYSTEM

In November 2017, Top Glove became the first private company in Malaysia to receive the ISO37001:2016 Anti-Bribery Management System (ABMS) certification. Top Glove’s Factory 9 in Meru, Klang was the first manufacturing facility to be certified and plans are underway to implement the ABMS practices in every factory starting September 2018. This will include the enhancement of the current anti-corruption training module enforcement of the gift policy, whistle blowing policy and Letter of Enforcement of Corporate Culture (LECC) as well as due diligence in recruitment and supplier selection. A special Integrity Unit, was also formed to oversee its implementation as well as provide advice and guidance.

We are also able to enhance existing bribery controls systematically by executing the anti-bribery and anti-corruption control plan for our day-to-day tasks. Whereas, the implementation of the bribery risk assessment helps to identify key areas of business processes that require control in order to mitigate bribery risks. The implementation of the bribery risk assessment is a requirement under ISO 37001:2016 that we have maintained and continue to conduct annually to ensure all our business processes are executed in an ethical, transparent and fair manner.

ACCOLADES FOR GOOD CORPORATE GOVERNANCE

Emerged winner at the MSWG - Asean Corporate Governance Award 2017

In recognition of our high standards of corporate governance, Top Glove garnered the Merit Award for Most Improved Corporate Governance Disclosure and Industry Excellence for Manufacturing at the MSWG ASEAN Corporate Governance Award 2017.

LISTED IN THE MSCI GLOBAL STANDARD INDEX AND MAINTAINED LISTING AS A FTSE4GOOD CONSTITUENT

Top Glove was recently included as a constitutent of the MSCI Global Standard Index effective June 2018, in recognition of its strong and consistent growth. Top Glove is also amongst an elite 34 out of over 700 PLCs in Malaysia to be listed as a constituent of the FTSE4Good Bursa Malaysia Index. It has maintained its standing since it was first included on the index in 2016, having demonstrated a leading approach to addressing Environmental, Social and Governance (ESG) risks in accordance to globally recognised standards.


NOVEMBER, 14Notice Date and Issuance of Annual Report 2018

DECEMBER(3RD WEEK)Unaudited consolidated results for the 1st quarter ending 30 November 2018

AGM

JANUARY, 820th Annual General MeetingTime : 10.30 a.m.Venue : Top Glove Tower

Proposed Final Dividend of 5.0 senEntitlement Date : 11 January 2019Payment Date : 25 January 2019

MARCH(3RD WEEK)Unaudited consolidated resultsfor the 2nd quarter ending 28 February 2019

JUNE(3RD WEEK)Unaudited consolidated resultsfor the 3rd quarter ending 31 May 2019

OCTOBER(2ND WEEK)Unaudited consolidated resultsfor the 4th quarter and financial year ending 31 August 2019

2NDQUARTER

FY2019

3RDQUARTER

FY2019

4THQUARTER

FY2019

2018

1STQUARTER

FY2019

2019

FINANCIAL CALENDARFOR FINANCIAL YEAR END 31 AUGUST 2019


English

All over the world, We are known,For our superior quality gloves,

Through the years we have grown,We have shown,

Our gloves stand out superior in the world,Top Glove is the best, Better than the rest,

Quality, Reliability and Consistency,Remain our policy,

At Top Glove’s Group of Companies.

Mandarin

Bahasa Malaysia

Dari mulanya, hingga terkini,Nama Top Glove diberi,

Pengeluar sarung tangan yang berkualiti,Yakinlah hasil pengeluaran kami,

Yang bermutu dan berkualiti tinggi,Sentiasa menuju kejayaan,

Untuk mencapai keunggulan.

Thai

TOP GLOVE CORPORATE SONG


The Board of Directors of Top Glove Corporation Bhd (“Top Glove” or “the Company”) (“the Board”) remains committed to embrace across organisation high standards of corporate governance and integrity whilst pursuing its corporate objectives in creating long-term shareholders’ value and competitiveness. The Board is always mindful on the importance of governance and acknowledges to continue delivering sustainable performance and instilling best corporate governance practices in building a sustainable business.

Top Glove’s commitment on corporate governance was testified by the following testament:

Malaysia-ASEAN Corporate Governance Transparency Index, Findings and Recognition 2017, the Company had achieved the following: i. Rank No. 14 in the list of top 100 companies with good disclosures (2016: No. 18); and ii. Rank No. 6 in the list of top 100 companies for overall corporate governance and performance

(2016: No. 7).

Top Glove’s exemplary corporate governance practices have received many recognitions including the following in the financial year ended 31 August 2018 (“FY2018”):

(a) Merit Award for Most Improved Corporate Governance Disclosure, MSWG~ASEAN CorporateGovernance Award 2017; and

(b) Industry Excellence in Manufacturing, MSWG~ASEAN Corporate Governance Award 2017.

Top Glove continues to be the selected constituents of the FTSE4Good Bursa Malaysia Index (“F4GBM”). Top Glove is included in the F4GBM Index since December 2015, having demonstrated a leading approach in addressing Environmental, Social and Governance (ESG) risks, in accordance to globally recognised standards. The aforesaid achievement reflects greater recognition of and better adherence to higher sustainability disclosure.

Top Glove is also one of the component stocks of the MSCI Global Standard Index, FBM Mid 70 Index, FBM Top 100 Index, FBM EMAS Syariah Index and FBM Hijrah Shariah Index.

Top Glove and its subsidiaries (“the Group”) will continue to endeavour its efforts in evaluating its governance practices in response to the evolving best practices and the changing requirements. The Board is pleased to present the Corporate Governance Overview Statement for the FY2018 outlining the application of the principles and recommendations as set out in the following guides:

(a) Companies Act 2016 (“CA 2016”);(b) Bursa Malaysia Securities Berhad (“Bursa Securities”) Main Market Listing Requirements (“Main LR”);(c) Malaysian Code on Corporate Governance (“MCCG”); and(d) Corporate Governance Guide 3rd Edition issued by Bursa Malaysia Berhad.

The Group noted on the principles and recommendations of the above-mentioned guides and will further review its corporate governance practices to bring the same to be in line with the recommendations under those guides.

As part of its efforts to enhance its practices, Top Glove has also taken the initiative to benchmark itself against leading corporate governance standards of reputable public listed companies in Malaysia.

CORPORATE GOVERNANCE OVERVIEW STATEMENT


Release of Annual Report and Quarterly Financial Results and holding of Annual General Meeting (“AGM”) and Analyst Briefing

Date of Issue/Release

No. of Days after end of Year/ Quarter

Bursa SecuritiesDeadline for the Issue/ Release

Date of AGM/ Analyst Briefing

No. of Days after date of Issue/ Release

Annual Report 2017 13 November 2017 74 31 December 2017 9 January 2018 56

Annual Report 2016 14 November 2016 75 31 December 2016 5 January 2017 51

2018 Quarterly Results

First Quarter 19 December 2017 19 31 January 2018 12 January 2018 24

Second Quarter 15 March 2018 15 30 April 2018 16 March 2018 1

Third Quarter 19 June 2018 19 31 July 2018 19 June 2018 same day1

Fourth Quarter 11 October 2018 41 31 October 2018 17 October 2018 6

Note:1 AnalystBriefingwasheldthroughtele-conferencing.

The MCCG covers three (3) broad Principles, which are (A) Board leadership and effectiveness; (B) Effective audit and risk management; and (C) Integrity in corporate reporting and meaningful relationship with stakeholders.

This statement is prepared in compliance with Bursa Securities Main LR and it is to be read together with Corporate Governance Report 2018 (“CG Report”) of the Company based on a prescribed format pursuant to Paragraph 15.25 of Bursa Securities Main LR. The CG Report is available on Top Glove’s website: http://www.topglove.com/corporate-governance/

The CG Report provides the details on how the Company has applied the 32 Practices and 4 Step-Ups as set out in the MCCG during the FY2018.

PRINCIPLE A: BOARD LEADERSHIP AND EFFECTIVENESS

Board’s Responsibilities

Top Glove is led by an experienced Board comprising members who are specialised in the glove manufacturing and various business sectors supported by a wide range of other professionals in the economics, engineering, legal and accounting sectors. This wide spectrum of skills and experience provide the strength that is needed to lead the Company to meet its objectives and enable the Company to rest in the firm control of an accountable and competent Board.

During our Board strategic planning (offsite) meeting held on 17 January 2018, as part of the Board’s function to set the strategic direction of the Company, the Board has carved the strategic statements focussing on key strategic areas as the Group’s strategy plan to support the Group’s long-term value creation and sustainability businesses. The Board has also identified the key management personnel responsible for each key strategic area and they have to provide progressive report on its implementation to the Board. The Board will review, monitor and oversee the implementation of the key strategic areas at its quarterly Board meeting.

The annual budget meeting is held every year for the Board to review and oversee the Group’s budget together with the strategy plan of each business unit. During the FY2018, a brainstorming session was organised amongst the Board members and key management personnel to draft the new Vision and Mission Statement of the Company.

Presently, the Board is supported by four (4) Board Committees namely, Audit Committee (“AC”), Risk Management Committee (“RMC”), Nomination and Remuneration Committee (“NRC”) and Investment Committee (“IC”) that are delegated with specific responsibilities to oversee the Group’s affairs, with authority to act on behalf of the Board in accordance with their respective Terms of Reference (“TOR”). Each Board Committee will review, report and make recommendation to the Board during the Board meeting on matters relevant to their roles and responsibilities. The Board Committees also table the minutes of the Board Committees meetings at the quarterly Board meetings as to keep the Board abreast of the decision and discussion made by each Board Committee.



(CONT’D)

The Board Charter duly adopted by the Board clearly established the functions reserved for the Board, Directors’ roles and responsibilities and those delegated to Management. It is a reference and induction literature in providing the Board members and Management insight into the functions of the Board. The Board Charter is accessible through the Company’s website: http://www.topglove.com/corporate-governance/

Role of Chairman, Managing Director, Executive Directors and Independent Non-Executive Directors (“INED”)

The Executive Chairman, Tan Sri Dr Lim Wee Chai is primarily responsible for the orderly conduct of the Board meetings and ensure effectiveness of the Board.

The Managing Director, Dato’ Lee Kim Meow will assist the Executive Chairman in the effectiveness of implementation of the Board policies, making operational decisions and monitoring the day-to-day running of the businesses, including defining the limits of Management’s responsibilities.

The Executive Directors are responsible for the day-to-day operations of the Group whereby operational issues and problems are discussed, major transactions and matters relating to the Group are reviewed and operational strategies are formulated.

INEDs are to deliberate and discuss policies and strategies formulated and proposed by Management with the view of long-term interests of all stakeholders. The INEDs provide independent and unbiased view, advice and judgement to ensure a balanced and unbiased decision making process to safeguard the long-term interests of all stakeholders and the community.

The Senior INED, Tan Sri Dato’ Seri Utama Arshad Bin Ayub (“Tan Sri Arshad Ayub”), acts as a point of contact for shareholders and other stakeholders with concerns which have not been resolved or those deemed inappropriate to be communicated through the normal channels.

Role of Company Secretaries

The Company Secretaries play significant role in supporting the Board for ensuring that all governance matters and Board procedures are followed and that applicable laws and regulations are complied with. The Company Secretaries also highlight all compliance and governance issues that required the Board’s attention.

The Company Secretaries also facilitate the communication of key decisions and policies between the Board, Board Committees and senior management.

Board Meetings

The dates of the meetings of the Board, Board Committees and AGM for each financial year were fixed in advance for the whole year to ensure all Directors/Board Committees members’ dates are booked and also to facilitate Management’s planning for the whole financial year.

The Board meets quarterly to review its quarterly performance and discuss new policies and strategies. Additional meetings will be called as and when necessary. During the FY2018, seven (7) Board meetings were held and the attendance of the Board and Board Committees members are as follows:

FY2018 meeting calendar for the Board and Board Committees

Sept ‘17

Oct ‘17

Nov ‘17

Dec ‘17

Jan ‘18

Feb ‘18

Mar ‘18

Apr ‘18

May ‘18

June ‘18

July ‘18

Aug ‘18

BOD √ √ √ √ √ √ √

AC √ √ √ √ √ √

NRC* √ √ √ √

IC √ √

RMC √ √ √ √ Note:* NominationandRemunerationCommitteehadbeenmergedon13October2017.Themeetingsincluded

NominationCommitteeMeetingheldon12October2017andRemunerationCommitteeMeetingheldon15September2017.



(CONT’D)

Attendance of Directors and Board Committees members at the respective meetings held during the FY2018

Name of Directors Board ofDirectors GMΩ

Board Committees

AC@ RMC NRC¥ IC

1. Tan Sri Dr Lim Wee Chai(Executive Chairman)

7/7(100%)#

3/3(100%)#

1/1(100%)§

2/2(100%)#

2. Tan Sri Arshad Ayub 6/7(85.7%)

3/3(100%)

7/8(87.5%)#

3/3(100%)#

2/2(100%)§

3. Tan Sri Rainer Althoff 7/7(100%)

3/3(100%)

4/4(100%)§

4. Puan Sri Tong Siew Bee 6/7(85.7%)

3/3(100%)

5. Dato’ Lee Kim Meow 7/7(100%)

3/3(100%)

4/4(100%)§

6. Lim Hooi Sin 7/7(100%)

2/3(66.7%)

7. Lim Cheong Guan 7/7(100%)

3/3(100%)

4/4(100%)§

1/2(50%)§

8. Dato’ Lim Han Boon 7/7(100%)

3/3(100%)

8/8(100%)§

4/4(100%)#

4/4(100%)§

2/2(100%)§

9. Datuk Noripah Binti Kamso 7/7(100%)

3/3(100%)

7/8(87.5%)§

2/2(100%)§

10. Sharmila Sekarajasekaran 7/7(100%)

3/3(100%)

8/8(100%)§

3/3(100%)§

11. Tay Seong Chee Simon 7/7(100%)

3/3(100%)

12. Datuk Dr. Norma Mansor 7/7(100%)

3/3(100%)

4/4(100%)§

3/3(100%)§

13. Low Chin Guan(appointed as Executive Director on 4 April 2018 and removed on 10 October 2018)

2/2(100%)

Total no. of Meetings: 7 3 8 4 4 2

Note:# Chairman§ MemberΩ Generalmeetings.One(1)AGMheldon9January2018.Two(2)EGMsheldon9January2018and8March2018.@ AChadeight (8)meetings, includes two (2)meetingswithExternalAuditors (withoutExecutiveDirectors’

and Management’s presence), one (1) meeting with Internal Auditors (without Executive Directors’ andManagement’spresence)andone(1)meetingoninternalauditmatters.

¥ NominationandRemunerationCommitteehadbeenmergedon13October2017.

All the above meetings were held in the Company’s Corporate Office at Top Glove Tower, 16, Persiaran Setia Dagang, Setia Alam, Seksyen U13, 40170 Shah Alam, Selangor Darul Ehsan except for the Board Offsite meeting which was held at Phuket, Thailand.

In the intervals between Board meetings, any matters requiring urgent Board’s decisions or approvals will be sought via circular resolutions which are supported with all the relevant information and explanations required for an informed decision to be made and the same for the Board Committees.

The Board decisions made at the Board meetings shall be by a majority as prescribed by the Constitution of the Company.



(CONT’D)

During the FY2018, some of the Board agenda items are as follows:

(a) Strategic planning for the Group;(b) Budget review;(c) Quarterly Unaudited Consolidated Results;(d) Half-year Financial Performance Report; (e) Business Plan and Development; (f) Proposals and updates on Investment Projects; (g) Corporate proposals on Mergers and Acquisitions;(h) Progress updates on implementation of Key Strategic Areas; (i) Regulatory and Compliance updates; (j) Share performances on Bursa Malaysia Securities Berhad and Singapore Exchange Limited; (k) Capital Structure review and Balance Sheet Management; (l) Sustainability initiatives of the Group and reporting;(m) Analysis of Corporate Governance disclosure;(n) Dividend proposal; and (o) Board Committees composition, board processes and governance review.

All AC members are financially literate. Dato’ Lim Han Boon is a member of the Malaysian Institute of Accountants, the Chartered Management Institute, United Kingdom (“UK”) and fellow of the Association of Chartered Certified Accountant, UK which fulfilled the financial expertise requirement by Bursa Securities Main LR.

Our Executive Director and Senior General Manager, Finance attend all meetings of the AC, other than meetings held between the AC and External Auditors (without Executive Directors’ and Management’s presence) as well as the meeting held between the AC and Internal Auditors (without Executive Directors’ and Management’s presence).

During the FY2018, the AC met with the External Auditors (without Executive Directors’ and Management’s presence) twice and met with the Internal Auditors (without Executive Directors’ and Management’s presence) once.

Further details on the summary of activities of the AC during the FY2018 is set out separately in the AC Report on pages 90 to 91 of this Annual Report.

Supply of Information to the Board

All Directors are provided with an agenda of the meeting and board papers which contain the Company’s financial performance, business outlook, various Board Committees’ reports and disclosures by Directors of their interests in the shares and their interests in contracts, properties and offices pursuant to Section 219 and Section 221 of the CA 2016, respectively prior to the Board meeting. The board papers are issued in advance and in a timely manner to facilitate informed decision making. The Managing Director and Executive Directors would lead the presentation of board papers and provide comprehensive explanations of business plans, business performance, potential mergers and acquisitions and other pertinent issues.

Any proposal and recommendation by Management will be deliberated and discussed by the Board before a decision is made. All matters raised, discussions, deliberations, decisions and conclusions including dissenting views made at the Board meetings with clear actions to be taken by responsible parties are recorded in the minutes.

The Notices of the Board and Board Committees’ meetings are send within fourteen (14) days prior to the meetings and at all times, endeavour to deliver the non-financial meeting materials within seven (7) days prior to the meetings whereas the financial materials would be delivered in average within two (2) days prior to the meetings as the aforesaid materials are sensitive information.

Notices on the closed period for trading in Top Glove’s securities are served to Directors, key management personnel and principal officers who are deemed to have privy to any sensitive information for the applicable periods especially the regular annual scheduled Board meetings to approve the quarterly financial results. This is to comply with Bursa Securities Main LR and the Capital Markets and Services Act 2007 requirements where Directors, key management personnel and principal officers of the Company and the Group are prohibited from trading in securities or any kind of property based on price sensitive information which have not been publicly announced within 30 calendar days before the targeted date of announcement of the quarterly financial results up to the date of announcement. In the FY2018, none of the Directors dealt in Top Glove’s securities during the closed period.



(CONT’D)

The Directors are also notified of any corporate announcement released to Bursa Securities and the impending restrictions on dealing with the securities of the Company prior to the announcement of the quarterly financial results.

All Directors and Company Secretaries have been issued with the Code of Conducts for Directors and Secretaries. The Company Secretaries also act as the Secretaries for all the Board Committees.

Board Composition and Balance

The Board currently comprises twelve (12) members, made up of five (5) Executive Directors including the Executive Chairman and Managing Director and seven (7) INEDs. The roles and responsibilities of the Executive Chairman and the Managing Director are distinctive and have been clearly segregated to further enhance and preserve a balance of authority and accountability to avoid unfettered powers of decision making. The composition reflects a balance of Executive Directors and Non-Executive Directors (including INEDs); ensuring that all Board’s discussions or decisions have the benefit of predominantly outside views and experiences, and that the INEDs are free from interests and influences that may conflict with their duties to the Company.

The majority number of INEDs help to ensure effective check and balance of the Board’s function as the INEDs are often the carers of the minority shareholders in providing constructive feedbacks to the proposals of the Company.

There are four (4) female Board members, representing 33% of the total Board members. The aforesaid female Board members provide the Board with gender diversity that bring value to the Board’s deliberations from the different perspectives and insights of the female Board members.

During the FY2018, Mr. Low Chin Guan was appointed to the Board on 4 April 2018 as Executive Director due to acquisition of Aspion group of companies. Subsequently, he had been removed from the Board on 10 October 2018 via an Extraordinary General Meeting.

The profile of each of the Board members is as presented on pages 10 to 17 of this Annual Report.

Independence

The Board recognises the significant contribution by INEDs to the Company in bringing independent and objective judgement to the Board in decision making.

The term “independence” as prescribed under Bursa Securities Main LR states that INEDs should be independent of management and free from any business or other relationships which could interfere with the exercise of independent judgement or the ability to act in the best interests of the Company. INED is willing to express his/her opinion to the Board free of concern about his/her position or the position of any third party. Nevertheless, none of the INEDs engage in the day-to-day management of the Company, participate in any business dealings or is involved in any other relationships with the Company (other than in situations permitted by the applicable regulations).

An annual independency assessment has been carried out by the NRC to ensure the independency of all INEDs. The assessment is based on the criteria on independence as set out in Bursa Securities Main LR and Practice Notes of Bursa Securities Main LR, including a self-declaration of any involvement or relation which could interfere an independent judgement and ability to act in the best interests of the Company. An independent confirmation is obtained based on the independency assessment before the appointment of INED and INEDs are assessed annually to re-affirm their independence based on the provisions of Bursa Securities Main LR.

During the FY2018, the Board was satisfied that none of the INEDs had any relationship that could materially interfere with, or perceived to be materially interfere with their unfettered and independent judgement and ability to act in the best interests of the Company.



(CONT’D)

Gender Diversity on Board and Management

The Company takes diversity not only at the Board level but also at the workplace as it is an essential measure of good governance, critically attributing to a well-functioning organisation and sustainable development of the Company. Diversity encapsulates not only gender but also age and ethnicity, if well-managed, can drive performance and strengthen governance.

Despite of the importance of Boardroom diversity, the Board is of the view that the selection criteria of a Director, based on effective blend of competencies, skills, extensive experience and knowledge in areas identified by the Board, should remain a priority, not compromising on qualification, experience and capabilities.

A Board Diversity Policy was adopted by the Board in 2014 setting out the principles of Top Glove in maintaining a diversify Board. A copy of the Board Diversity Policy is made available on the Company’s website: http://www.topglove.com/corporate-governance/

Currently, the Board has 33% female representation. Aside from achieving the gender diversity aspect, the Board also aspires to achieve significant benefits by focusing on individual talents, abilities and experiences to meet the Group’s objectives of being the world’s leading gloves manufacturer; hence, requiring a Board with broader range of competence, skills and experience.

Below sets the summary of the gender, ethnicity and age mix of our Management team, excluding workers:

A) Gender (data compiled as at 26 September 2018)

Category Total Headcount Male Employees Female Employees

Headcount % Headcount %

All Staff 3,426 1,593 46.50 1,833 53.50

Management staff(Manager & above)

463 228 49.24 235 50.76

Directors on Board 13 9 69.23 4 30.77

B) Ethnicity

Category Total Headcount Malay Chinese Indian Others

Headcount % Headcount % Headcount % Headcount %

All Staff 3,426 1,613 47.08 864 25.22 375 10.95 574 16.75


463 109 23.54 282 60.91 33 7.13 39 8.42

Directors on Board 13 3 23.08 8 61.54 1 7.69 1 7.69



(CONT’D)

C) Age

Category Total Headcount 70 & Above 60 to 69 50 to 59 40 to 49 30 to 39 20 to 29 Below 20

Headcount % Headcount % Headcount % Headcount % Headcount % Headcount % Headcount %

All Staff 3,426 2 * 26 * 184 5 396 11 861 25 1,942 57 15 *


463 1 * 10 2 51 11 123 27 205 44 73 16 - *

Directors on Board 13 2 15 5 39 6 46 - - - - - - - -

Re-election and Re-appointment of Directors

In accordance with the Company’s Constitution, all Directors who are appointed by the Board are subject to retirement at the first AGM of the Company subsequent to their appointment. One third (1/3) of all the other Directors shall retire by rotation at each AGM provided always that all Directors shall retire from office at least once in every three (3) years. The Directors retiring from office shall be eligible for re-election by the shareholders.

The Directors due for re-election by rotation pursuant to Article 94 of the Company’s Constitution at the forthcoming AGM are Dato’ Lee Kim Meow, Puan Sri Tong Siew Bee and Mr. Lim Hooi Sin. Their profiles are set out on pages 12 and 14 of this Annual Report.

The Company has not established a term limit of the INEDs as the Board believes that a term limit does not in any way interfere with their contributions in terms of skills, experience, professionalism and integrity including core competencies in exercising their objectivity and independent judgement to discharge their responsibilities in good faith and in the best interests of the Company which are more critical in ascertaining the function and effectiveness of their independence than the number of years served on the Board. The on-going evaluation also further ensure the effectiveness of the Board as a whole in discharging their duties and responsibilities despite the duration of service for one (1) INED has exceeded nine (9) years.

Directors’ Training

During the FY2018, the Directors have continued to participate in training programmes to equip themselves and to effectively discharge their duties as Directors as and when beneficial. The Directors have constantly kept themselves updated on both local and international affairs and to changes in regulations affecting the Company through advisories from regulatory bodies, Management and through self-reading.

The Directors are also updated by the Company Secretaries on any change to legal and governance practices of the Group, and new accounting and auditing standards that may have impact on the Company’s businesses via email and at every AC and Board meetings.

It is of the Company’s intention that each new Director is given a comprehensive briefing on the Company’s history, operations, financial control system and plant visit to enable him/her to have first-hand understanding of the Company’s operations.



(CONT’D)

During the FY2018, all Directors had collectively or individually attended/participated in the following seminars/forums/conferences/training programmes:

Directors Seminars/Forum/Conference/Training attended Date

Tan Sri Dr Lim Wee Chai 1. Forbes Global CEO Conference & Forbes 100th Anniversary celebration, Hong Kong

25 to 28 September 2017

2. 企业分享及展望世界500强, Wisma Huazong, Selangor

20 October 2017

3. Taiwan-Malaysia Industrial Collaboration Summit,Taichung, Taiwan

24 to 25 October 2017

4. Workshop on Face to Face with VIP, Top Glove Tower, Setia Alam, Selangor

2 December 2017

5. Mastering Creativity Workshop by Tan Sri Megat, Top Glove Tower, Setia Alam, Selangor

3 January 2018

6. Bank of Singapore Global Outlook, Kuala Lumpur 10 January 2018

7. Nikkei Asia 300 Summit, Singapore 18 January 2018

8. UOB Private Bank First Market Outlook 2018, Kuala Lumpur

27 February 2018

9. B-connected by UBS, Beijing, China 26 to 28 April 2018

10. The JP Morgan Tech Ex-change, Shenzhen, China 10 May 2018

11. Asia ~ The Greater Disruptor Investor Forum, Singapore

16 May 2018

12. KWSP’s strategy visit to Germany 19 to 22 May 2018

13. Stewardship Asia Roundtable 2018, Singapore 4 June 2018

14. DBS Asian Insights Conference 2018, Singapore 13 July 2018

15. Top Glove Youth Leadership Submit Top Glove Tower, Setia Alam, Selangor

14 July & 22 September 2018

16. UOB Private Bank KL Investment Forum, Kuala Lumpur

24 July 2018

17. Alliance DBS Research 2nd Half Market Outlook, Kuala Lumpur

26 July 2018

18. FMM Council Brainstorming session, Bentong, Pahang

3 to 4 August 2018

Tan Sri Arshad Ayub 1. Independent Directors’ Programme: The Essence of Independence, Kuala Lumpur

20 November 2017

Dato’ Lee Kim Meow 1. Motivational Talk from Successful Malaysian Entrepreneur, Klang, Selangor

9 September 2017

2. Synthomer Latest Technological Innovation, Kuala Lumpur

15 September 2017

3. Fraud Risk Management Workshop by Bursa Malaysia, Kuala Lumpur

26 September 2017

4. Corporate Governance Breakfast Series: Leading Change @ The Brain, Kuala Lumpur

5 December 2017

5. Mastering Creativity Workshop by Tan Sri Megat, Top Glove Tower, Setia Alam, Selangor

3 January 2018



(CONT’D)


Dato’ Lee Kim Meow (Cont’d)

6. Invest Malaysia 2018, Kuala Lumpur 23 January 2018

7. Best Practice Forum, Kuala Lumpur 30 March 2018

8. DTAP Kickoff Event by MDEC & MIDA, Kuala Lumpur 9 April 2018

9. Top Glove Youth Leadership Submit, Top Glove Tower, Setia Alam, Selangor

14 July 2018

10. Nation Building Event “New Malaysia: What's Next?”, Kuala Lumpur

11 August 2018

Tan Sri Rainer Althoff 1. Independent Directors’ Programme: The Essence of Independence, Kuala Lumpur

20 November 2017

Puan Sri Tong Siew Bee 1. Taiwan-Malaysia Industrial Collaboration Summit, Taichung, Taiwan

25 October 2017

2. MRCA Corporate Advisors ~ MRCA 25th Anniversary, Kuala Lumpur

9 November 2017

3. Integrity Talk 2017, Top Glove Tower, Setia Alam, Selangor

8 December 2017

4. Nikkei Asia 300 Summit, Singapore 18 January 2018

5. Julius Baer 2018 Market Outlook Luncheon Seminar, Kuala Lumpur

13 February 2018

6. UBS B:connected 2018, Beijing, China 25 to 28 April 2018

7. Visited Customer in SuZhou and attended J.P. Morgan Tech Exchange 2018, Shenzhen, China

9 to 12 May 2018

8. Stewardship Asia Roundtable 2018, Themed “Stewardship in a Disruptive World”, Singapore

4 June 2018

9. FMM Selangor 'Nite 2018 27 June 2018

10. FMM Council Brainstorming session, Bentong, Pahang 3 to 4 August 2018

Lim Hooi Sin 1. J.P. Morgan Asia Pacific CEO-CFO Conference, New York 6 to 7 September 2017

2. MEDICA Conference, Germany November 2017

3. Daiwa Investment Conference, New York 29 to 30 May 2018

Lim Cheong Guan 1. Morgan Stanley Sixteenth Annual Asia Pacific Summit, Singapore

15 to 17 November 2017

2. CIMB 10th Annual Malaysia Corporate Day, Kuala Lumpur

4 January 2018

3. DBS Pulse of Asia 2018, Singapore 11 January 2018

4. Invest Malaysia 2018, Kuala Lumpur 23 to 24 January 2018

5. Nomura Malaysia Focus, Kuala Lumpur 13 February 2018

6. Corporate Governance Briefing session: MCCG Reporting & CG Guide, Kuala Lumpur

28 February 2018

7. Credit Suisse Asian Investment Conference, Hong Kong

19 to 20 March 2018

8. SGX Corporate Connect Seminar, Singapore 22 March 2018

9. Invest ASEAN Singapore 2018 27 to 28 March 2018

10. Macquarie ASEAN Conference, Singapore 28 August 2018



(CONT’D)


Dato’ Lim Han Boon 1. Fraud Risk Management Workshop by Bursa Malaysia, Kuala Lumpur

26 September 2017

2. Smart Sourcing Summit ~ Sustainable Growth in a “VUCA” environment, Kuala Lumpur

2 November 2017

3. CG Breakfast Series with Directors ~ Integrating an Innovation Mindset with Effective Governance, Kuala Lumpur

7 November 2017

4. 8th International TEMOS Conference ~ Dusseldorf/Germany "Healthcare Abroad & Medical Tourism"

3 to 5 December 2017

5. Valuation on Mergers and Acquisitions, Kuala Lumpur 25 June 2018

6. Corporate Liability Provisions by MACC, Petaling Jaya, Selangor

2 July 2018

7. Sustainable Capitalism Forum by Securities Commission, Kuala Lumpur

16 July 2018

8. International Professional Practices Framework for Audit Committee by Bursa Malaysia, Kuala Lumpur

28 August 2018

Datuk Noripah Binti Kamso 1. Valuation on Mergers and Acquisitions, Kuala Lumpur

25 June 2018

2. Sustainability Engagement Series for Directors/Chief Executive Officers for 2018, Kuala Lumpur

5 July 2018

3. Series 6 (The Role of Boards in Fraud Risk Management), Petaling Jaya, Selangor

20 August 2018

Tay Seong Chee, Simon 1. Arbitration: What Every Corporate Lawyer Should Know, Singapore

4 September 2017

2. Arbitration: Fundamentals Matters & Recent Developments, Singapore

5 September 2017

3. International Law Year in Review, Singapore 8 February 2018

Datuk Dr. Norma Mansor 1. Mandatory Accreditation Programme, Kuala Lumpur 25 to 26 September 2017

2. CG Breakfast Series with Directors ~ Integrating an Innovation Mindset with Effective Governance, Kuala Lumpur

7 November 2017

3. Sustainability Engagement Series for Directors/ Chief Executive Officers, Kuala Lumpur

5 July 2018

Sharmila Sekarajasekaran 1. IP : Moving Towards 2050, Kuala Lumpur 10 April 2018

2. National Consultation in Gender Equality, Kuala Lumpur 24 to 25 July 2018

Succession Planning

The Board is responsible for reviewing candidates for key positions namely, the Executive Chairman, Managing Director, Executive and Non-Executive Directors and all Head of Divisions. The succession planning is to ensure all candidates appointed to senior management positions are of sufficient calibre. The Board had adopted a Succession Planning Policy in September 2013 ensuring that there are platforms in place to provide for the orderly succession of senior management.

The Succession Planning Policy is made available on the Company’s website: http://www.topglove.com/corporate-governance/

Ethical Standards, the Codes and Policy

The Directors’ Code of Conduct (“Directors’ Code”) was adopted by the Board in September 2013. The Directors’ Code covers the principles of conflict of interests, insider dealings, integrity, law compliance obligation and others.



(CONT’D)

Directors are expected to conduct themselves with the highest ethical standards and to behave ethically and professionally at all times to promote and protect reputation and performance of the Company.

As part of the enforcement, Directors are required to submit their declaration adhering and observing to the provisions in the Directors’ Code annually.

The Directors’ Code is made available on the Company’s website: http://www.topglove.com/corporate-governance/

Employees’ Code of Conduct and Ethics (“Employees’ Code”) is a manual applicable to employees of Top Glove and the Group. It guides the employee’s conduct in the workplace, business conduct when dealing with external parties, key issues such as bribery, conflict of interests, insider trading as well as data integrity and retention. The Employees’ Code is disseminated to the Group’s employees through its intranet.

The Employees’ Code is made available on the Company’s website: http://www.topglove.com/corporate-governance/

The Board believes that having a Whistle-Blowing Policy in place strengthens, supports good management and at the same time demonstrates accountability, good risk management and sound corporate governance practice. A Whistle-Blowing Policy was adopted by the Board in year 2010 and is made available on the Company’s website: http://www.topglove.com/whistle-blowing/

The Board aims to provide a platform and to act as a mechanism for parties to channel their complaints or to provide information on fraud, wrongdoings or non-compliance to any rule or procedure by employees or Management of the Company. The Whistle-Blowing Policy outlines when, how and to whom a concern may be properly raised, distinguishes a concern from a personal grievance and allows the whistle-blower the opportunity to raise a concern outside their management line and in confidence. The identity of the whistle-blower is kept confidential and protection is accorded to the whistle-blower against any form of reprisal or retribution. Any concern raised will be investigated by the Top Glove Prevention and Anti-Corruption Committee and Whistle Blowing Committee and a report and update will be provided to the Board, through the AC.

Whistle-blowers may write to the AC to communicate on any information about fraudulent actions and breaches of ethics directly and anonymously to [email protected].

NRC

The Board had merged the Nomination Committee and Remuneration Committee into a new Committee, known as NRC in October 2017, which aimed to improve its efficiency and effectiveness in discharging its duties. The composition of the NRC is as follows:

(1) Tan Sri Arshad Ayub ~ Chairman(2) Dato’ Lim Han Boon ~ Member(3) Datuk Dr. Norma Mansor ~ Member(4) Sharmila Sekarajasekaran ~ Member

The Board through the NRC reviewed its required mix of skills and experience and other qualities, including core competencies in which the Director should bring to the Board. The Board has also implemented a process to be carried out by the NRC annually for continuous assessment and feedback to the Board on the effectiveness of the Board as a whole, the Board Committees and the contribution of each individual Director and AC member. During the deliberation of the performance of a particular Director who is also a member of the NRC, that member abstains from the discussions in order to avoid any conflict of interest.

During the FY2018, the NRC met four (4) times and the following key activities were deliberated:

(a) Discussed and recommended the appointment of Executive Director of the Company.(b) Reviewed the Succession Planning and Leadership Development of the Board and senior management

team of the Company.(c) Discussed the allocation of Employees’ Share Option Scheme (“ESOS”) to INEDs.(d) Reviewed its TOR and recommended the same to the Board for adoption.(e) Reviewed the Organisation Chart of the Company.(f) Deliberated on the findings of the Board’s and Board Committees’ assessments and reported the findings

in the Board meeting.(g) Discussed and recommended to the Board the proposed Directors’ fees and Board Committees’ fees for

the FY2018, benchmarked with industry survey.(h) Reviewed the payment of Directors’ benefits (excluding Directors’ fees) to Non-Executive Directors.(i) Reviewed and recommended to the Board for approval of the remuneration packages for Executive Directors

and related employees.(j) Recommended the re-election, re-appointment and retention of Directors.



(CONT’D)

Board Mix and Skillsets Matrix

The Board is ultimately responsible for the oversight and review of the management, administration, compliance and overall governance of Top Glove. Consequently, the Board has been evaluated based on the following matrixes, which capture the key skills of the Board members which it believes are critical to succeeding in its objectives.

The Board presently possesses the following blend of skills, which are the appropriate mix of skills and experience required for the Board:

(a) Corporate Governance, Risk Management and Internal Controls(b) Financial, Audit, Accounting and Taxation(c) Strategic Planning(d) Human Resource/Executive Performance Review(e) Legal, Regulatory and Compliance(f) Market Development

The evaluation result allows the NRC to address the evaluation assessment and the training needs of the Directors effectively.

Board Membership Criteria

In reviewing and recommending to the Board any new Director appointment, the NRC considers:

(a) Age, skills, knowledge, expertise, experience, professionalism, integrity, capabilities and such other factors which would contribute to the Board’s collective skills;

(b) Competing time commitments if the candidate has multiple board representations; (c) Composition requirements for the Board and Board Committees; and(d) Independence, for the appointment of an INED.

Boardroom Appointments

The selection, nomination and appointment of suitable candidates to the Board follow a transparent process.

Review of candidates for Board’s appointment has been delegated to the NRC. The NRC is also responsible to review the existing composition of the Board, identifying the gaps and subsequently review and recommend to the Board a suitable candidate with the relevant skillsets, expertise and experience.

Top Glove’s Boardroom appointment process is as follows:

Board Induction/Orientation Programme

The Board’s Induction/Orientation is a programme co-ordinated by the Company Secretaries together with the Executive Director and head of business units with the objectives of providing newly appointed Directors the necessary information and overview to assist them in understanding the operations, corporate strategies, current issues and challenges, structure and the management of the Company, as well as on-site briefings or site visits for better understanding of the operations aspect of the Company.

Board, Board Committees and Individual Director Assessment

The Board undertakes annual evaluation for the FY2018 via an Online Assessment system to review their own performance, the effectiveness of the Board as a whole, the contribution of each individual Director and peers, independency of INEDs and the Board’s mix and skillset.

NRC conducts annual

assessment and review,

identify gaps/ vacancy

NRC identifies the “Potential Candidates”

Evaluation on the “Potential Candidates”

Interviews the shortlisted candidates

Final recommendation

to the Board

Board approves the appointment of Director



(CONT’D)

The assessment of the Board covers areas such as the Board structure, operation, roles and responsibilities, Chairman’s roles and responsibilities and the performance of the Board Committees. For self and peer assessments, the assessment criteria have included Board interaction and contribution, quality of input to the Board and Directors’ calibre and personality.

As for the AC, an effective evaluation as a whole and member’s self and peers’ evaluation, Internal Audit function and the External Auditors performance and independence, were assessed. The assessment criteria include the quality and composition, skills and competencies, meeting administration and conduct, the effectiveness of Internal Audit function and the quality, performance, independency and the adequacy of audit scope of External Auditors.

NRC conducts review annually on its required mix of skills and experience and other qualities, including core competencies in which the Directors should bring to the Board.

The NRC is entrusted with the responsibility of carrying out annual Board effectiveness evaluation, the annual AC’s term of office and performance evaluation and to authorise the evaluation process to ensure it meets the objectivity, including to review and approve all the evaluation forms/questionnaires, review the results of the evaluation and finally to convey the results to the respective parties for improvement and enhancement.

The evaluations were facilitated by the Company Secretaries making references to the guides available and the good corporate governance compliance companies.

The results of the evaluations indicated that the Board comprised highly competent Directors and has been effective in discharging its oversight responsibilities. The suggested areas for improvement were in respect of succession planning for the Board Committees. The results and comments from the Directors, concerning the Board as a whole and the general performance of the Directors, were also presented to the Board upon reviewed by the NRC and the NRC had also made its recommendations to the Board.

Time Commitment

Paragraph 15.06 of Bursa Securities Main LR provides a director of a listed company must not hold more than five (5) directorships in listed companies.

Save for the Executive Chairman, Tan Sri Dr Lim Wee Chai, who was appointed as Deputy Chairman (Non-Independent Non-Executive) of Tropicana Corporation Berhad, none of the Executive Directors of the Company serve as a director of other listed companies.

Key Information on Directors

A brief description of the background of each Director is presented on pages 10 to 17 of this Annual Report. The Directors proposed for re-election are stated in the Notice of AGM.

No alternate Director has been appointed in respect of any of the Directors, during the FY2018.

Greater Transparency on Remuneration

A Remuneration Policy was adopted by the Board in October 2015. The Remuneration Policy was adopted to ensure that the Non-Executive Directors are commensurate according to their level of responsibilities and experience and to structure the component parts of remuneration so as to link rewards to corporate and individual performance of Executive Directors and ensure it was aligned with the business strategy and long-term objectives of the Company. The performance of the Executive Director is measured based on the achievements of his annual key performance indicators as well as the performance of the Group.

The Company rewards its employees and the Executive Directors with options under the ESOS and shares under the Employees’ Share Grant Plan (“ESGP”). The Executive Directors are not entitled to receive meeting allowances for the Board and Board Committees meetings they have attended. The details of the vesting of options under the ESOS and awards of shares under the ESGP are set out on pages 98 to 99 of this Annual Report under the Directors’ Report of the Audited Financial Statements for the FY2018.

Whereas, the Non-Executive Directors are entitled to receive meeting allowances for the Board and Board Committees meetings they have attended but are not entitled to participate in the ESOS and ESGP.



(CONT’D)

The details of the Directors’ remuneration comprising remuneration received/receivable from the Company and the subsidiaries in FY2018 are as follows:

(i) Received from Top Glove

SalariesRM

FeesRM

BonusRM

ESOSRM

OtherEmolument

RM

Benefit-in-kind

RMTotal

RM

Executive Directors

1. Tan Sri Dr Lim Wee Chai 2,301,910 119,000 281,905 112,850 236,380 31,150 3,083,195

2. Puan Sri Tong Siew Bee - 73,000 - - - - 73,000

3. Dato’ Lee Kim Meow - 83,000 - - - - 83,000

4. Lim Hooi Sin - 73,000 - 15,006 - - 88,006

5. Lim Cheong Guan 523,112 73,000 91,190 33,184 74,612 19,290 814,388

6. Low Chin Guan (appointed as Executive Director on 4 April 2018 and removed on 10 October 2018)

- 28,000 - - 1,000 - 29,000

Non-Executive Directors

7. Tan Sri Arshad Ayub - 117,500 - - 15,032 - 132,532

8. Dato’ Lim Han Boon - 91,000 - - 18,282 - 109,282

9. Tan Sri Rainer Althoff - 79,500 - - 11,032 - 90,532

10. Datuk Noripah Binti Kamso

- 81,200 - - 12,532 - 93,732

11. Sharmila Sekarajasekaran - 82,800 - - 13,032 - 95,832

12. Tay Seong Chee, Simon* - SGD 72,600

- - SGD 677

- SGD73,277

13. Datuk Dr. Norma Mansor - 82,800 - - 12,532 - 95,332

Total 2,825,022 1,201,600 373,095 161,040 396,466 50,440 5,007,663

Note:*Mr.TaySeongChee,Simon’sDirector’sfeesandotheremolumentwerereceivedorreceivableinSingaporeDollar.



(CONT’D)

(ii) Received on Group Basis

SalariesRM

FeesRM

BonusRM

ESOSRM

OtherEmolument

RM

Benefit-in-kind

RMTotal

RM

Executive Directors

1. Tan Sri Dr Lim Wee Chai 2,301,910 119,000 281,905 112,850 236,380 31,150 3,083,195

2. Puan Sri Tong Siew Bee 168,196 73,000 16,570 5,551 22,294 35,200 320,811

3. Dato’ Lee Kim Meow 587,356 83,000 92,874 37,210 81,637 19,371 901,448

4. Lim Hooi Sin 726,984 77,039 - 15,006 - - 819,029

5. Lim Cheong Guan 523,112 73,000 91,190 33,184 74,612 19,290 814,388

6. Low Chin Guan (appointed as Executive Director on 4 April 2018 and removed on 10 October 2018)

440,000 28,000 - - 83,949 - 551,949

Non-Executive Directors

7. Tan Sri Arshad Ayub - 117,500 - - 15,032 - 132,532

8. Dato’ Lim Han Boon - 91,000 - - 18,282 - 109,282

9. Tan Sri Rainer Althoff - 79,500 - - 11,032 - 90,532

10. Datuk Noripah Binti Kamso

- 81,200 - - 12,532 - 93,732

11. Sharmila Sekarajasekaran - 82,800 - - 13,032 - 95,832

12. Tay Seong Chee, Simon* - SGD 72,600

- - SGD 677

- SGD73,277

13. Datuk Dr. Norma Mansor - 82,800 - - 12,532 - 95,332

Total 4,747,558 1,205,639 482,539 203,801 583,346 105,011 7,327,894

Note:*Mr.TaySeongChee,Simon’sDirector’sfeesandotheremolumentwerereceivedorreceivableinSingaporeDollar.

Other Board Committees

The following Board Committees were established to support and strengthen the Board:

• AC, details as stated on page 89 of this Annual Report.• RMC, details as stated on page 86 of this Annual Report.• NRC, details as stated on page 73.• IC, details as stated below.

The IC was established to provide guidance on the fund investments of the Company. The existing members of IC consist of the following:

(1) Tan Sri Dr Lim Wee Chai ~ Chairman(2) Tan Sri Arshad Ayub ~ Member(3) Dato’ Lim Han Boon ~ Member(4) Dato’ Noripah Binti Kamso ~ Member(5) Lim Cheong Guan ~ Member

For the FY2018, the IC met twice and the key activities undertaken by the IC are as follows:

(a) Reviewed the Bond investment portfolios of the Company to ensure that the target yield is achieved.(b) Reviewed the overseas investment and potential of listing of overseas subsidiary.(c) Briefed on the global market outlook by bankers.



(CONT’D)

ESOS Committee

The Company, with approval from the shareholders in its Extraordinary General Meeting held on 9 January 2008, had established the ESOS II and the ESOS II was officially implemented on 1 August 2008 and expired on 1 August 2018. The Company had also obtained its shareholders’ approval on the establishment of ESOS III during its EGM held on 9 January 2018. The ESOS III had been duly implemented with effect from 1 June 2018.

The ESOS Committee established by the Board on 11 April 2003 continued to oversee the administration as well as to ensure proper implementation of ESOS according to the By-laws of ESOS. In order to institute a good corporate governance practice, the Board had at its meeting held on 11 October 2018 revamped the composition of the ESOS Committee which now consisted of majority INEDs, as below:

(1) Tan Sri Dr Lim Wee Chai ~ Chairman(2) Lim Cheong Guan ~ Member(3) Lim Jin Feng ~ Member(4) Dato’ Lim Han Boon ~ Member(5) Datuk Noripah Binti Kamso ~ Member(6) Datuk Dr. Norma Mansor ~ Member(7) Sharmila Sekarajasekaran ~ Member

During the FY2018, the ESOS Committee had considered and approved the options offer factors under the ESOS to the eligible employees of the Group.

ESGP Committee

The ESGP was approved by the shareholders of the Company at the Extraordinary General Meeting held on 6 January 2016.

The Board had established the ESGP Committee to administer the ESGP in accordance to the By-laws of ESGP. In order to institute a good corporate governance practice, the Board had at its meeting held on 11 October 2018 revamped the composition of the ESGP Committee which now consisted of majority INEDs, as below:

(1) Tan Sri Dr Lim Wee Chai ~ Chairman(2) Lim Cheong Guan ~ Member(3) Lim Jin Feng ~ Member(4) Dato’ Lim Han Boon ~ Member(5) Datuk Noripah Binti Kamso ~ Member(6) Datuk Dr. Norma Mansor ~ Member(7) Sharmila Sekarajasekaran ~ Member

During the FY2018, the ESGP Committee had considered and approved the award factors under the ESGP to the eligible employees of the Group.

Senior Management Team

The Board is not involved in the day-to-day operations whereby the Board has delegated the authority and accountability for the day-to-day business operations of the Company, its subsidiaries and their respective operations to the senior management team led by the Managing Director and Executive Directors who report periodically to the Group Executive Chairman, Board and Board Committees. The senior management team is responsible for assisting the Managing Director and Executive Directors in implementing the policies and procedures adopted by the Board to achieve the Group’s objectives.

The Board has unrestricted access to any information pertaining to the Group and any assistance of the senior management team. The senior management team would be invited to attend the Board and the Board Committees meetings as and when required and to provide explanations or clarifications on their respective areas of responsibility.



(CONT’D)

The Board acknowledged the recommendation of MCCG to disclose the remuneration of top nine (9) senior management on a named basis in bands of RM50,000. However, the Board took cognisance of the confidentiality and sensitiveness of the staff’s remuneration and competitiveness from the outside world, the Board wished to stress the importance of the stability and continuity of the business operations supported by a competent and experienced executive team in place. For this disclosure, the Board is of the view that the disclosure be made on the following aggregate basis is suffice for stakeholders to make an appreciable link between remuneration of senior management and the performance of the Group:

Range of Remuneration (Annual basis) (RM) Top Nine (9) Senior Management Team

150,001 to 200,000 1

250,001 to 300,000 1

350,001 to 400,000 2

400,001 to 450,000 3

450,001 to 500,000 1

600,001 to 650,000 1

PRINCIPLE B: EFFECTIVE AUDIT AND RISK MANAGEMENT

Strengthen the Independence and Effectiveness of the AC

The Board is committed to provide a balanced, fair and comprehensive assessment of the Company’s state of affairs in its financial statements. To ensure this, adequate financial processes are in place, aimed at keeping the Group’s accounting records and transactions in accordance with accepted accounting standards. This also helps to safeguard the preparation of annual financial statements which present a true and fair view of the state of affairs of the Group and the Company at the reporting dates.

The Board is also committed to ensure that it presents a balanced and comprehensive assessment of the operations and financial results of the Group on a quarterly basis. It releases the quarterly financial report upon the Board’s approval and in any event not later than two (2) months after the end of each quarter of its financial year for public announcement together with the required disclosure of Bursa Securities Main LR.

These quarterly reports are published in a condensed format with full financial statements prepared.

The AC was established to assist the Board in overseeing the Group’s activities within its clearly defined TOR.

The Directors’ Responsibility Statement for the Audited Financial Statements of the Company is set out on page 93 of this Annual Report. The details of the Company and the Group’s Audited Financial Statements for the FY2018 are made available on pages 95 to 186 of this Annual Report.

The NRC shall review the term of office and performance of the AC and each of its members annually to determine whether such AC and its members have carried out their duties in accordance with their TOR.

The Board has full access to both Internal and External Auditors and receives reports on all audits performed by them via the reports made by AC in Board meetings.

External Auditors and its Independence

The AC maintains a transparent and professional relationship with the External Auditors of the Company.

The AC is assigned to assess, review and supervise the performance, suitability and independence of the External Auditors. An External Auditors Assessment Policy was adopted by the AC which outlined the guidelines and procedures for the AC to assess and review the performance, suitability and independence of External Auditors.

The AC invites the External Auditors to attend all its meetings as and when required. The External Auditors had met the AC six (6) times during the reporting year. During the meetings, the External Auditors highlighted and discussed the nature, scope of the audit, audit programme, internal controls and issues that required the attention of the AC or the Board.

The AC had met with the External Auditors separately without the presence of Executive Directors and Management twice during the FY2018 to discuss on matters relating to the Group and its audit activities.



(CONT’D)

The External Auditors Assessment Policy adopted by the Company restricts the type of non-audit services that can be provided by the External Auditors of the Group and the approval process related to them. Under this Policy, only non-audit services which are able to provide clear efficiencies and value-added benefits to the Group are accepted by the AC. The External Auditors Assessment Policy in place also ensure that the External Auditors’ independence and the provision of non-audit works does not impede the External Auditors’ audit works.

The AC remains confident that the objectivity and independence of the External Auditors are not in any way impaired by reason of the non-audit services provided to the Group.

The External Auditors have confirmed to the AC that they are, and have been, independent throughout the conduct of the audit engagement in accordance with the independence criteria set out by the International Federation of Accountants’ Code of Ethics for Professional Accountants and the Malaysian Institute of Accounts’ By-Law (on Professional Ethics, Conduct and Practice).

Details of statutory audit, audit-related and non-audit fees paid/payable in the FY2018 to the External Auditors are set out below:

Type of Fees Top Glove (RM)

Top Glove Group (RM)

(a) Audit fees ~ Ernst & Young Malaysia 85,000 316,000

(b) Non-audit fees ~ Ernst & Young Malaysia~ Affiliate to Ernst & Young Malaysia

91,000850,000

215,000850,000

(c) Tax compliance fees ~ Ernst & Young Malaysia - 51,000

Total: 1,026,000 1,432,000

Related Party Transactions (“RPT”)

A RPT Policy was developed and put in place in June 2016 to provide an avenue for employees to understand the policies and procedures that need to be adhered to in identifying and treating RPTs to ensure compliance with Bursa Securities Main LR and other applicable laws. The said Policy outlines the framework and the processes for purposes of identifying, monitoring, evaluating, reporting and approving the RPTs and recurrent related party transactions (“RRPTs”). It also serves as a guide to the AC and Board in discharging its role, which is to provide oversight over RPTs and RRPTs within the Group.

Significant RPTs of the Group for the FY2018 are set out on page 173 of this Annual Report. The AC had reviewed the RPTs that arose within the Group to ensure that the transactions were fair, reasonable and on normal commercial terms as well as not detrimental to the minority shareholders and were in the best interests of the Company.

Facilitate Objective Oversight by the Board of the AC

Minutes of each AC meeting is noted by the Board via distribution to each Board member and the Chairman of the AC highlights on key issues at each Board meeting.

The performance and effectiveness of AC would be assessed annually through AC evaluation and AC members self’s and peers’ evaluation conducted by the AC, and NRC reviewed the results of such assessments. The NRC reviews the term of office and performance of the AC members annually. During the FY2018, the Board is satisfied that the AC and its members have been able to discharge their functions, duties and responsibilities in accordance with the TOR of the AC.

Dedicated RMC

The Board and Management have embarked on the risk management culture and endeavour to ensure that the Group’s employees have a good understanding and application of risk management principles towards cultivating a sustainable risk management culture. The Board undertakes to conduct regular risk awareness sessions at the operational level to promote the understanding of risk management principles and practices across different functions within the Group. The Board is responsible of identifying principal risks and ensures the implementation of a dynamic system to manage risk exposure within the acceptable level of tolerance. To fulfil its oversight responsibility, the Board, as a whole or through delegation to the RMC reviews the adequacy and integrity of the Group’s risk management system which encapsulates the key processes of risk identification, assessment, mitigation, monitoring and reporting.



(CONT’D)

Ensure the Internal Audit function is effective and independent

The Internal Audit (“IA”) Department carries out the IA function, which reports directly to the AC on its activities based on the approved annual IA plan.

The Board acknowledges its responsibility for maintaining a sound system of internal controls, which provides reasonable assessment of effective and efficient operations, internal financial controls, and compliance with laws and regulations as well as with internal procedures and guidelines.

The AC had met with the Internal Auditors separately without the presence of Executive Directors and Management once (1) during the FY2018 on any matters relating to the Group and IA activities.

The appointment, resignation and dismissal of the Head of IA is reviewed and approved by the AC and the Head of IA has unfettered access to the AC, the Board and the Management.

An IA Charter was adopted in year 2013 aimed to formalise the Mission Statement of Top Glove’s IA Department and established its position within the Company to ensure its access to various records, departments and activities, its responsibility and independence.

The Mission Statement of IA is to provide an independent, objective assurance and consulting activity designed to add value and improve Top Glove’s operations and internal controls and assist the Company to accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes.

An overview of the state of internal control within the Group, which includes the risk and key internal control structures, are set out in the Statement on Risk Management and Internal Control on pages 86 to 88 of this Annual Report.

PRINCIPLE C: INTEGRITY IN CORPORATE REPORTING AND MEANINGFUL RELATIONSHIP WITH STAKEHOLDERS

Corporate Disclosure

The Board reviews and approves all quarterly and other important announcements. The Company announces its quarterly and full year results within the mandatory period. The financial statements and press releases including material and price sensitive information are disseminated and publicly released via Bursa LINK on a timely basis to ensure effective dissemination of information relating to the Group.

The Board has formalised a set of Corporate Disclosure Policy to ensure that communications to the public regarding the Group are timely, factual, accurate and complete. The said Policy outlines the central principles and practices in communicating with the investors, shareholders, medias and regulators.

Effective Dissemination of Information

An effective communication channel between the Board, stakeholders, institutional investors and the investing public at large is essential to provide a clear and complete picture of the Group’s performance and development, in a comprehensive, timely and continuing disclosure manner. Essentially, the Board is fully committed in maintaining a high standard in the dissemination of relevant and material information on the development of the Group.

The Company has had always been providing as much information on a voluntary basis in addition to complying with Bursa Securities Main LR through media releases. The Board is mindful of the legal and regulations governing the release of material and sensitive information so as not to mislead shareholders. Therefore, information that is price-sensitive or any undisclosed material information about the Group is not disclosed to any party until it is ready for simultaneous distribution.



(CONT’D)

The Company has been using the following formal channels to communicate with shareholders and stakeholders:

• AnnualReport

The Annual Report remains a major channel of communication disclosing information not only on the Group’s businesses, financials and additional information such as the Company’s mission and vision, operations performance, outlooks and senior management team. The Board constantly improve the contents of the Annual Report to incorporate developments among others, in corporate governance and reports of Board Committees and ensure the accuracy of the information as the Annual Report is a vital and convenience source of essential information for investors, shareholders and other stakeholders.

The Chairman and Executive Director oversee the production of the Annual Report and review its contents before it is published.

Annual Reports of the Company are available online at the Company’s website: http://www.topglove.com/annual-report/

Corporate related queries may be referred to the Company Secretary, Ms. Kassy Lim (Contact no.: +603-3362 3098, Fax no.: +603-3362 3860, E-mail: [email protected]).

• AnnouncementstoBursaSecurities

All announcements are made via Bursa LINK. Examples of announcements are the quarterly financial results, circulars, corporate exercises, corporate changes and others. The Board is entrusted to review and approve the announcements ensuring its full compliance with regulatory authorities’ disclosure requirements.

All announcements are made available at the Company’s website: http://www.topglove.com/bursa-announcements/

Announcements related queries may be referred to the Company Secretary, Ms. Kassy Lim (Contact no.: +603-3362 3098, Fax no.: +603-3362 3860, E-mail: [email protected]).

• QuarterlyResultsandAnalystandMediaBriefings

Analyst and media briefing via conference call is usually held immediately after the release of quarterly financial results to Bursa Securities or an actual briefing is held a week after the release of the quarterly financial results and chaired by the Executive Chairman, Managing Director and Executive Director. This briefing provides an avenue for fund managers, research analysts and media to have dialogue with the Group’s Management to facilitate the receiving of a balanced and complete view of the Group’s performance and challenges at the timeliest manner.

• InvestorRelations(“IR”)

The IR team has been scheduling regular engagement sessions with investors and are usually attended by the Executive Director and the IR team.

The IR team also attends to conferences, non-deal roadshows, and one-on-one meetings with equity analysts, fund managers and institutional shareholders to provide updates on the Company’s quarterly financial performance, corporate and regulatory developments as well as to discuss on strategic matters and address issues that the investing community may have with respect to the businesses or operations of the Company.



(CONT’D)

Some of the investor conferences and roadshows attended by our IR team in FY2018 are as follows:

No. Conference Date

1. Daiwa Investment Conference Hong Kong 2017 November 2017

2. Morgan Stanley Sixteenth Annual Asia Pacific Summit November 2017

3. CIMB 10th Annual Malaysia Corporate Day January 2018

4. DBS Pulse of Asia 2018 January 2018

5. Invest Malaysia 2018 January 2018

6. Nomura Malaysia Focus Kuala Lumpur February 2018

7. Credit Suisse Asian Investment Conference March 2018

8. SGX Corporate Connect Seminar Singapore March 2018

9. Invest ASEAN Singapore 2018 March 2018

10. SGX-MKES Healthcare Day May 2018

11. Invest Malaysia United Kingdom 2018 June 2018

12. Invest Malaysia Tokyo 2018 July 2018

13. Macquarie ASEAN Conference, Singapore August 2018

Investor queries pertaining to financial performance or developments may be directed to the Executive Director, Mr. Lim Cheong Guan (Contact no.: +603-3362 3098, Fax no.: +603-3362 3860, E-mail: [email protected])

• CompanyWebsite

The Group has established a comprehensive website at www.topglove.com which includes a dedicated section on IR to further enhance shareholders’ communication.

The Group has also included a Corporate Governance section on its website where information such as the Board Charter, Directors’ Code, Employees’ Code, Succession Planning Policy, Corporate Disclosure Policy, Whistle-Blowing Policy and various governance compliance statements are made available to the shareholders and public at http://www.topglove.com/corporate-governance/

To better serve stakeholders of the Group, a feedback page on the website provides an avenue for stakeholders to suggest improvements to the Group via email: [email protected]. In addition, stakeholders who wish to reach the respective divisions of the Group can do so through the ‘Contact Us’.

Encourage shareholders’ participation at general meetings

The Company despatches its Annual Report to all shareholders of the Company which includes the notice of AGM at least 28 days prior to the AGM. In addition to sending the notice, the Company also published the Notice of AGM on its website and released via Bursa LINK.

The AGM is the principal forum for dialogue with shareholders. A member of the Company entitled to attend and vote at the meeting is entitled to appoint not more than two (2) proxies to attend and vote in his stead. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy. There shall be no restriction as to the qualification of the proxy. A proxy appointed to attend and vote at the meeting shall have the same rights as the member to speak at the meeting.

During the AGM, a presentation is given by the Chairman, Managing Director and Executive Director to explain on the Group’s strategy, performance and major developments to shareholders. The Board encourages shareholders to participate in the questions and answers session at every general meeting. The Directors also shared with the shareholders of the Company’s responses to questions raised by Minority Shareholder Watch Group, submitted in advance of the AGM.

Outcome of the AGM on all resolutions proposed at the AGM is submitted to Bursa Securities at the end of the meeting day. The Board has ensured that each item of special businesses included in the notice of the AGM is accompanied by a full explanation of the effects of a proposed resolution.



(CONT’D)

The extract of minutes of general meetings (including the attendance of Directors, questions raised by shareholders and the respective responses, outcome of the voting results and the reply to the Minority Shareholder Watch Group’s queries) are made available to the shareholders and public for reference at http://www.topglove.com/general-meeting/

Using technology to facilitate voting and shareholders participation at meetings

The Company had implemented the poll voting via electronic means for past AGMs. The verification and counting of votes were done expeditiously. In addition, the Company has appointed a scrutineer to validate the votes cast at the AGM.

The result of each resolution was announced, which includes votes in favour and against and upon which the Chairman declared whether the resolutions were carried. The poll results were also announced by the Company via Bursa LINK on the same day for the benefit of all shareholders.

Effective communication and proactive engagement

The Company endeavours to maintain an open and transparent channel of communication with its stakeholders, institutional investors and the investing public at large with the objective of providing as clear and complete picture of the Group’s performance and financial position as possible.

The Chairman of the AC, NRC and the External Auditors were present at the last AGM and will endeavour to be present at the forthcoming AGM to assist the Directors in addressing queries raised by the shareholders. Based on the past, the Company’s AGM have been well attended. It has always been the practice for the Chairman to provide ample time for the questions and answers sessions during the AGM.

Shareholders were given a copy of suggestion form to invite shareholders to feedback and comment for notation by Management for consideration. Shareholders were also invited to submit any additional questions they might have had via help desk counter at the venue of the general meeting so that these could be responded to in writing after the meeting. Officers of the Company were present to assist and answer any queries raised by shareholders.

During the FY2018, the Company also had regular meetings with analysts and institutional fund managers, participated roadshows and investors conferences, both domestically and internationally, and hosted teleconferences with investors and analysts.

Summary of Corporate Governance Practices

Overall, the Company has applied all the Practices encapsulated in MCCG for the FY2018 except for the following:

• Practice 7.2: The board discloses on a named basis the top five senior management’s remuneration component including salary, bonus, benefits in-kind and other emoluments in bands of RM50,000.

• Practice 8.2: The AC has a policy that requires a former key audit partner to observe a cooling-off period of at least two (2) years before being appointed as a member of the AC.

• Practice 11.2: Large companies are encouraged to adopt integrated reporting based on a globally recognised framework.

• Practice 12.3: Listed companies with a large number of shareholders or which have meetings in remote locations should leverage technology to facilitate:

** voting including voting in absentia; and ** remote shareholders’ participation of General Meetings.

The Company has provided explanations for the departures from the said Practices and measures that the Company will take to achieve the intended outcome of the departed Practices in the CG Report.



(CONT’D)

OTHER COMPLIANCE INFORMATION

1. Utilisation of Proceeds

The Company did not raise funds through any corporate proposal during the financial year ended 31 August 2018 (“FY2018”).

2. Recurrent Related Party Transactions of a Revenue or Trading Nature

The Shareholders’ Mandate for the Recurrent Related Party Transactions of a Revenue or Trading Nature was not renewed since the Nineteenth Annual General Meeting (“AGM”).

3. Material Contracts

During the FY2018, there were no material contracts entered into by the Company and its subsidiaries involving Directors’, chief executive’s and/or major shareholders’ interests.

4. Material Contracts Relating to Loans

During the FY2018, there were no material contracts relating to loans entered into by the Company and its subsidiaries involving Directors’, chief executive’s and/or major shareholders’ interests.

5. Insider Trading

During the FY2018, there was no insider trading reported.

6. Employees’ Share Option Scheme (“ESOS”)

During the FY2018, a total of 3,425,360 new ordinary shares were issued and allotted pursuant to the exercise of the ESOS. The details of the issued and paid-up share capital of the Company as at 31 August 2018 are as follows:

No. of Shares RM

As at 1 September 2017 1,256,298,764 636,643,620.16

Ordinary shares issued pursuant to the ESOS 3,425,360 11,971,936.00

Ordinary shares issued as satisfaction of consideration for acquisition of Aspion Sdn Bhd

20,505,000 137,000,000.00

ESOS compensation reserve - 2,093,269.00

As at 31 August 2018 1,280,229,124 787,708,825.16

During the financial year, the number of ESOS option granted under ESOS III was 3,166,600 options. The percentage of ESOS option granted to the Directors and senior management was 21.9% of the total ESOS option granted.

The number of ESOS option granted and exercised by the Directors are disclosed on page 98 of this Annual Report.

7. Employees’ Share Grant Plan (“ESGP”)

During the financial year, 93,700 shares were awarded to the eligible employees under the ESGP. The percentage of shares awarded to the senior management was 0.35% of the total shares awarded.

There were no shares awarded to the Directors pursuant to the ESGP in FY2018.



(CONT’D)

BOARD RESPONSIBILITY

The Board is committed to establish and maintain a sound, effective and efficient system of risk management and internal control to safeguard shareholders’ investment and the Group’s asset. There is an ongoing review process undertaken by the Board to ensure adequacy and integrity of the system mentioned.

The system of risk management and internal control is designed to identify and manage the Group’s risk within the acceptable risk tolerance, rather than to eliminate the risk of failure in achieving the Group’s corporate objective in accordance with the Group’s strategy. Accordingly, it can only provide reasonable assurance but not absolute assurance against material misstatement, financial loss or fraud.

RISK MANAGEMENT GOVERNANCE

The Board regards risk management as an integral part of all business operations. Hence, the Board explicitly assumes the responsibility of identifying principal risks and ensures the implementation of a dynamic system to manage risk exposure within the acceptable level of tolerance.

To fulfill its oversight responsibility, the Board, as a whole or through delegation to the Risk Management Committee (“RMC”), reviews the adequacy and integrity of the Group’s risk management system which encapsulates the key processes of risk identification, assessment, mitigation, monitoring and reporting.

The members of RMC, comprising of three Independent Non-Executive Directors and two Executive Directors, are as follows:(1) Dato’ Lim Han Boon ~ Chairman(2) Tan Sri Rainer Althoff ~ Member(3) Datuk Dr. Norma Mansor ~ Member(4) Dato’ Lee Kim Meow ~ Member(5) Lim Cheong Guan ~ Member

A Risk Working Committee (‘RWC”) has been formed in May 2013 to facilitate the group-wide risk management initiative from an operational perspective. RWC serves as the driving force behind the routine risk management activity. Its main function encompasses provision of regular feedback on risk factors’ status for informed management decision making, execution of appropriate risk mitigation measures and progress monitoring thereof, and identification of new and emerging risk factors.

RWC is headed by an Executive Director and comprises of heads of business units or support functions, who are risk owners themselves, as members.

RISK MANAGEMENT SYSTEM

At the Group level, inherent risk factors arising from business operation are continuously identified. These identified risk factors are incorporated into the risk register and individually rated as Extreme, High, Medium or Low risk. The rating process is guided by a matrix of possibility of occurrence and the associated impacts, of which both financial and non-financial consequences are duly considered. Thereafter, owners of these risk factors will drive the implementation of risk mitigation measures towards achieving a residual risk that is within the acceptable tolerance.

Progress updates on the mitigation measures will be furnished on a quarterly basis by risk owners for deliberation at the RWC meeting from an operational perspective. Adequacy and effectiveness of the mitigation measures will be assessed and further enhanced where necessary. In addition, any identified emerging critical risk factors will be incorporated into the risk register and managed in accordance to the Group’s risk management methodology. Outcome of RWC meetings will subsequently be escalated upwards to the RMC for further deliberation in a strategic manner. Direction of mitigation measures will be fine-tuned as it deems fit to ensure action plans are on track in addressing the significant risk factors. This approach creates a robust risk management system that is self-sustaining and will continue to evolve in response to changing business environment.

SIGNIFICANT RISK

As depicted in the Group’s risk management framework, risks are broadly categorized into the aspects of Business, Information, Production, Credit, Financial, Operational, Information System and Human Resources. Identified individual risk factors under the broad risk categories have undergone comprehensive reviews in line with the Group’s risk management methodology.

STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL


For financial year ended 31 August 2018, the key risks that warrant highlighting are as outlined below:

1. Business Execution of Merger and Acquisition exercises poses certain associated risks, notably the evaluation

of target company and its subsequent integration with the Group. Various measures such as M&A procedures, strengthening internal management team’s capability to handle operations after take-over and engaging external adviser for further advice have been carried out. M&A policies are still in the midst of being formalized.

2. Production Due to unforeseen circumstances, the Group’s factory production lines can face unplanned downtimes

and thus result in productivity and financial losses. The 3 major risk factors which potentially contribute to the above are identified as fire outbreak, flooding and water shortage. Ongoing mitigation measures are implemented and tested by the Group to curb occurrences of these risk factors to prevent interruption to production or temporary shutdown of factory.

3. Information System The Group’s business may be vulnerable to security breaches to key systems, assets and facilities resulting

from cyber vandalism or sabotage. Potential disruptions to operational systems or destruction of facilities from such security breaches can adversely affect the Group’s reputation, business and financial result. To mitigate the risk, the Group is vigilant on potential cyber threats and has been continuously upgrading and enhancing the Group’s security system.

4. Financial As an export-oriented manufacturing entity, the Group’s financial performance is exposed to the risks of

fluctuation in foreign currency exchange rates and volatility in commodity prices; particularly the main raw material in glove manufacturing which are natural rubber latex and nitrile latex. Major movements in key foreign currency exchange rates, such as US Dollar, and the related commodity prices will create a short-term impact on the Group’s financial performance due to time lag effect of the cost pass-through mechanism. The Group is thus constantly monitoring these risk factors and endeavors to achieve an effective and efficient cost pass-through mechanism to minimize the impact on its financial performance caused by macro factors.

INTERNAL CONTROL GOVERNANCE

The Management team, led by Executive Chairman, Managing Director and Executive Directors, comprises experienced personnel who are subject matter experts in their own specialized fields. These individual members in the Management team are held accountable for the conduct and performance within their assigned business units/ support functions. Internal control principles are strongly advocated and thus embedded into the various day-to-day operational policies and procedures of the business units/ support functions concerned. At regular intervals, these assigned business units/ support functions will conduct management meetings for the business objectives of, among others, performance assessment, action plan progress monitoring and feedback for improvement.

To fulfill its oversight responsibility, the Audit Committee (“AC”) is committed to review the adequacy and effectiveness of the Group’s internal control system. In this respect, the Group’s Internal Audit Department (”IAD”) has been set up in financial year ended 31 August 2003 to undertake the obligation to provide control assurance services to the Group.

The External Auditor provides further assurance to the AC in the form of annual statutory audit of the financial statements. Areas of concern identified during the course of external audit examination will be brought to the attention of the AC through management letters and discussion at AC Meeting.

INTERNAL AUDIT FUNCTION

The Group has in place an in-house IAD which provides to the Board, through the AC, independent assessment and assurance on the adequacy and effectiveness of the Group’s system of internal controls.



(CONT’D)


(CONT’D)


The scope of work of IAD encompasses the examination and evaluation of the adequacy, existence and effectiveness of the system of internal control, risk management framework and corporate governance of the group, which include, inter alia, the following:

• Reviewing the reliability and integrity of financial and operating information and the means used to identify, measure, classify and report such information;

• Evaluating the system established to ensure compliance with policies, plans, procedures, laws, and regulations which could have significant impact on operations;

• Examining the means of safeguarding assets and, as appropriate, verifying the existence of such assets;• Assessing the economy and efficiency with which resources are employed;• Appraising operations to ascertain whether results are consistent with established objectives and goals

and whether the operations are being carried out as planned;• Report significant issues related to the business and operational processes for controlling the activities of

the Group together with recommendations for improvements by issuing periodic audit reports summarizing results of audit activities and follow-up reports on timely basis to AC and management; and

• Assist in the investigation of significant suspected fraudulent activities and notify the AC and Top Management of the results.

The audit reports are presented and tabled at AC meetings quarterly to preserve its independence and objectivity. Significant internal audit findings and status update on outstanding management action plan will be brought to the attention of AC. If deemed necessary, management representative will be required to attend AC meeting to provide explanation and propose an action plan on the unresolved issues.

REVIEW OF EFFECTIVENESS

The Board is dedicated to operating a sound system of risk management and internal controls, and recognizes that the system must continuously evolve to support the progressive business growth of the Group.

The process for identifying, evaluating and managing risks as outlined in this Statement has been in place for the year under review and up to the date of approval of this statement. During the financial year ended 31 August 2018, a number of improvements to internal control gaps has been implemented. There has been no material adverse impact to the financial performance of the Group as a result of the internal control gaps detected.

The Board, with the assurance received from the Executive Chairman, Managing Director and its Executive Director, concludes that the Group’s risk management and internal control system is operating adequately and effectively, in all material aspects. This statement does not include the state of internal control in associate companies, which has not been dealt with as part of the Group and is made in accordance with a resolution of the Board of Directors dated 11 October 2018.

REVIEW OF THE STATEMENTS BY EXTERNAL AUDITORS

The External Auditors have performed limited assurance procedures on this Statement on Risk Management and Internal Control pursuant to the scope set out in Audit and Assurance Practice Guide (“AAPG”) 3, Guidance for Auditors on Engagements to Report on the Statement on Risk Management and Internal Control included in the Annual Report issued by the Malaysian Institute of Accountants for inclusion in the Annual Report of the Group for the FY2018, and reported to the Board that nothing has come to their attention that causes them to believe that this Statement included in the Annual Report is not prepared, in all material respects, in accordance with the disclosures required by Paragraphs 41 and 42 of the Statement on Risk Management and Internal Control: Guidelines for Directors of Listed Issuers , nor is the Statement factually inaccurate.

AAPG 3 does not require the External Auditors to consider whether the Directors’ Statement on Risk Management and Internal Control covers all risk and controls, or to form an opinion on the adequacy and effectiveness of the Group’s risk management and internal control system including the assessment and opinion by the Directors and Management thereon. The report from External Auditors was made solely for, and directed solely to the Board of Directors in connection with their compliance with the Bursa Malaysia Securities Berhad Main Market Listing Requirements and for no other purposes or parties. The External Auditors do not assume responsibility to any person other than the Board of Directors in respect of any aspect of this Statement.

AUDIT COMMITTEE REPORT


The Audit Committee (“AC”) of Top Glove Corporation Bhd (“the Company”) is pleased to present the AC Report for the financial year ended 31 August 2018 (“FY2018”).

AC COMPOSITION AND ATTENDANCE

The AC comprises four (4) members and all of whom are Independent Non-Executive Directors, which meets the requirements of paragraphs 15.09(1)(a) and (b) of Bursa Malaysia Securities Berhad (“Bursa Securities”) Main Market Listing Requirements (“Main LR”).

Tan Sri Dato’ Seri Utama Arshad Bin Ayub (“Tan Sri Arshad”), Chairman of AC, had a distinguished career in the Malaysian Civil Service, held various positions, including Deputy Governor of Bank Negara Malaysia and Deputy Director General in the Economics Planning Unit of the Prime Minister’s Department. Nevertheless, Tan Sri Arshad has other directorships in several public listed companies where he is also the member of AC.

Dato’ Lim Han Boon, member of AC, is a member of the Malaysian Institute of Accountants, the Chartered Management Institute, United Kingdom (“UK”) and fellow of the Association of Chartered Certified Accountants, UK, fulfills the financial expertise as required by Bursa Securities Main LR. He also has vast working experience in areas of corporate finance.

Datuk Noripah Binti Kamso, member of AC, has vast experience in the Banking and Investment industry. She was the former Advisor of CIMB Islamic and the founding Chief Executive Officer of CIMB-Principal Islamic Asset Management Sdn Bhd. She was also the Past President of the Malaysian Futures Brokers Association (MFBA). She was formerly a Global Practitioner in Residence in Principal Financial Group Centre for Global Citizenship, United States of America.

Ms. Sharmila Sekarajasekaran, member of AC, was in legal practice for many years, and joined the RIM Group in year 2005 and held various positions in the RIM Group.

In FY2018, the AC had met eight (8) times, two (2) of which were meeting with the External Auditors, without Executive Directors’ and Management’s presence and one (1) of which was meeting with the Internal Auditors, without Executive Directors’ and Management’s presence. The Executive Director, Head of Internal Audit, Senior Management, External Auditors, other Board members and the Company Secretary will attend the AC meetings upon invitation, as and when necessary. The attendance record of AC members was as follows:

Members Directorship Meeting Attendance

Tan Sri Dato’ Seri Utama Arshad Bin Ayub (Chairman)

Senior Independent Non-Executive Director 7/8 (87.5%)

Dato’ Lim Han Boon Independent Non-Executive Director 8/8 (100%)

Datuk Noripah Binti Kamso Independent Non-Executive Director 7/8 (87.5%)

Sharmila Sekarajasekaran Independent Non-Executive Director 8/8 (100%)

During the FY2018, the AC had constantly engaged with the External Auditors and the Head of Internal Audit to keep abreast with the key audit issues and audit concerns affecting the Company.

Minutes of each AC meeting are noted by the Board via distribution to each Board member and the Chairman of the AC highlights on key issues discussed in the AC meeting at each Board meeting.

The performance and effectiveness of AC would be assessed annually through AC evaluation and AC members’ self and peer evaluation conducted by the AC, and the Nomination and Remuneration Committee (“NRC”) reviewed the results of such assessments. The NRC reviews the term of office and performance of the AC members annually. During the FY2018, the Board is satisfied that the AC and its members have been able to discharge their functions, duties and responsibilities in accordance with the terms of reference (“TOR”) of the AC.



TOR OF THE AC

The AC had discharged its functions and carried out its duties as set out in the TOR of the AC.

The TOR of the AC is available for reference on the Company’s website at http://www.topglove.com/corporate-governance/

SUMMARY OF ACTIVITIES FOR THE FY2018

1. Financial Reporting (a) Reviewed all the four (4) Quarter’s Financial Statements and the annual Audited Financial Statements of

the Company and recommended the same for the Board’s approval. Discussions focused particularly on any change in the accounting policies and its implementation; significant and unusual events arising from the audit; the going concern assumption; compliance with accounting standards and other legal requirements; significant matters highlighted in the financial statements; and significant judgements made by Management.

(b) Reported its findings on the financial and Management performance, and other material matters to the Board.

2. Internal Audit (a) Reviewed and approved the three years Internal Audit Plan for FY2018, FY2019 and FY2020 proposed

by the Internal Auditors to ensure the adequacy of the scope, coverage of works and that it has the necessary authority to carry out its works.

(b) Reviewed the Internal Audit programme and results of Internal Audit together with the recommendations from the Internal Auditors. The AC considered the Internal Auditors’ recommendations taken into account Management’s responses and upon which approved the Internal Auditors’ proposals for rectification and implementation of the agreed remedial actions for improvement.

(c) Undertook assessment of the performance of the Internal Audit function and reviewed its effectiveness of the audit processes and assessed the performance of the overall Internal Audit Department (“IAD”).

(d) Held separate meetings to discuss the result of assessment with the Internal Auditors and other areas of Internal Audit’s concern, without the presence of Executive Directors and Management.

(e) Conducted interviews with the potential candidates to fill the vacancy as the Head of Internal Audit.

3. External Audit (a) Discussed with the External Auditors before the audit commences, the audit plan, nature and scope

of the audit, areas of audit emphasis, and ensured co-ordination where more than one (1) audit firms are involved; as well as the External Auditors’ evaluation of the system of internal controls and audit reports.

(b) Discussed and deliberated on the External Auditors’ reports and recommendations regarding opportunities for improvement to the significant risk areas, internal controls and financial matters areas based on observations made in the course of interim and final audits.

(c) Held two (2) private meetings with the External Auditors without the presence of the Executive Directors and Management to discuss on the areas of audit concern.

(d) Discussed the results of annual assessment on the suitability and the independence of the External Auditors pursuant to the Company’s External Auditors’ Assessment Policy.

(e) Reviewed the performance of the External Auditors and recommended its re-appointment and remuneration to the Board.

(f) Reviewed and approved the provision of non-audit services rendered by the External Auditors.

(CONT’D)



4. Related Party Transactions (a) Reviewed and recommended on quarterly basis the related party transactions presented by

Management to the Board for approval, to ensure that these transactions are undertaken in the best interest of the Company, fair, reasonable and on normal commercial terms as well as not detrimental to the interest of the minority shareholders.

(b) Monitored the thresholds of the related party transactions and recurrent related party transactions to ensure compliance with Bursa Securities Main LR.

5. Annual Reporting Reviewed the AC Report, Statement on Risk Management and Internal Control and Corporate Governance

Statement to ensure adherence to legal and regulatory reporting requirements and appropriate resolution of all accounting matters requiring significant judgement and recommended the same to the Board for approval.

6. Others (a) Reviewed the progress of all investment projects of the Company. (b) Reviewed the Investment Portfolios of the Company. (c) Deliberated the emerging financial reporting issues pursuant to the introduction of new accounting

standards and additional statutory/regulatory disclosure requirements. (d) Considered and discussed new business ventures of the Company for the Board’s approval. (e) Verified the share buy-back of the Company. (f) Verified the allocation of Employees’ Share Option Scheme (“ESOS”) and Employees Share Grant Plan

(“ESGP”) complied with the criteria as stipulated in the by-laws of ESOS and ESGP of the Company, respectively.

(g) Reviewed Whistle-Blowing Policy and cases of the Company. (h) Reviewed the term of office of the AC members.

TRAINING

During the FY2018, all of the AC members have attended various seminars, training programme and conferences. The list of trainings attended is disclosed in the Corporate Governance Overview Statement on pages 70 to 72 of this Annual Report.

INTERNAL AUDIT FUNCTION

The IAD is led by Lim Lung Fui @ Jack, a member of Malaysian Institute of Accountants who reports directly to the AC. The principal objective of IAD is to undertake regular reviews of the systems of controls, procedures and operations so as to provide reasonable assurance that the internal control system is sound, adequate and satisfactory. The function of the IAD is to provide the AC with independent and objective reports on the state of internal controls of the operating units within the Group and the extent of compliance by such units with the Group’s established policies and procedures and the regulatory requirements of the relevant authorities. The AC reviews and approves the Internal Audit plan of the Group submitted by the Head of Internal Audit.

During the FY2018, the areas audited included audits of the various departments covering all the factories and subsidiaries within the Group. Internal Audit reports were issued to the AC regularly and tabled in the AC meetings. The reports are also issued to the respective operations management, incorporating audit recommendations and Management’s responses with regards to any audit finding on the weaknesses in the systems and controls of the operations. The IAD conducted follow-up audit to ensure the agreed audit recommendations were implemented appropriately.

The total costs incurred for the in-house Internal Audit function for the FY2018 was RM605,096.48 (2017: RM522,156.00).

(CONT’D)

AUDIT COMMITTEE REPORT(CONT’D)


RISK MANAGEMENT

The Board and Management have embarked on the risk management culture and endeavour to ensure that the Group’s employees have a good understanding and application of risk management principles towards cultivating a sustainable risk management culture. The Board undertakes to conduct regular risk awareness sessions at the operational level to promote the understanding of risk management principles and practices across different functions within the Group.

RISK MANAGEMENT COMMITTEE (“RMC”) COMPOSITION AND ATTENDANCE

In FY2018, the RMC had met four (4) times. The composition and the attendance record of the RMC members were as follows:

Directors Directorship Meeting Attendance

Dato’ Lim Han Boon (Chairman of RMC) Independent Non-Executive Director 4/4 (100%)

Tan Sri Rainer Althoff Independent Non-Executive Director 4/4 (100%)

Dato’ Lee Kim Meow Managing Director 4/4 (100%)

Lim Cheong Guan Executive Director 4/4 (100%)

Datuk Dr. Norma Mansor Independent Non-Executive Director 4/4 (100%)

TOR OF THE RMC

The RMC had discharged its functions and carried out its duties as set out in the TOR of the RMC.

The TOR of the RMC is available for reference on the Company’s website at http://www.topglove.com/corporate-governance/

The aforesaid matter is further elaborated in details under a separate statement known as “Statement on Risk Management and Internal Control” on pages 86 to 88 of this Annual Report.

TopGlove’scondomfactorycommencedoperationsinJuly2018


The Directors are required by the Companies Act 2016 (“CA”) to cause Management to prepare the financial statements for each financial year which have been made out in accordance with the provision of the CA and applicable approved accounting standards.

The Directors are required to prepare financial statements which give a true and fair view of the state of affairs of the Group and of the Company at the end of the financial year, and of the results and cash flows of the Group and of the Company for the financial year.

In preparing the financial statements, the Directors shall ensure that Management have:

a) Adopted appropriate accounting policies and applied them consistently;b) Made judgements and estimates that are reasonable and prudent; c) Ensured that all applicable approved accounting standards in Malaysia have been followed; andd) Prepared the financial statements on a going concern basis.

The Directors are responsible to ensure that the Group and the Company keep accounting records that disclose with reasonably accuracy the financial position of the Group and of the Company, and which enable them to ensure that the financial statements comply with the CA.

The Directors have general responsibilities for taking such steps as are reasonably available to them to safeguard the assets of the Group and of the Company, and to detect and prevent fraud and other irregularities.

TheExtraordinaryGeneralMeetingheldon10thOctober2018

DIRECTORS’ RESPONSIBILITY STATEMENTFOR THE AUDITED FINANCIAL STATEMENTS


PAGEPAGE 95 Directors’ Report

101 Statement by Directors

101 Statutory Declaration

102 Independent Auditors’ Report

106 Statements of Profit or Loss

107 Statements of Comprehensive Income

108 Statements of Financial Position

111 Statements of Changes in Equity

114 Statements of Cash Flows

117 Notes to the Financial Statements

ThestampingprocessintheproductionofCastPolyethylene(CPE)gloves

FINANCIAL STATEMENTSFOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018


The directors have pleasure in presenting their report together with the audited financial statements of the Group and of the Company for the financial year ended 31 August 2018.

Principal activities

The principal activities of the Company are investment holding and provision of management services.

The principal activities and other information of the subsidiaries are described in Note 19 to the financial statements.

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

Results

Group Company RM’000 RM’000

Profit net of tax 437,906 233,759

Profit attributable to:Owners of the parent 434,215 233,759Non-controlling interests 3,691 -

437,906 233,759

There were no material transfers to or from reserves or provisions during the financial year other than as disclosed in the financial statements.

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

Dividends

The amount of dividends paid by the Group and the Company since 31 August 2017 were as follows:

Group and Company RM’000

In respect of the financial year ended 31 August 2017:

Final tax exempt single tier dividend of 8.5 sen per share on 1,255,159,000 ordinary shares, declared on 10 November 2017 and paid on 25 January 2018 106,691

In respect of the financial year ended 31 August 2018:

First tax exempt interim single tier dividend of 7 sen per share on 1,277,926,000 ordinary shares, declared on 19 June 2018 and paid on 17 July 2018 89,454

196,145

Further details on dividends recognised during the financial year are disclosed in Note 44.

At the forthcoming Annual General Meeting, a single tier final dividend of 5 sen per share on 2,556,316,000 ordinary shares amounting to RM127,817,000 in respect of the financial year ended 31 August 2018 will be proposed for shareholders’ approval. The financial statements for the current financial year do not reflect this proposed dividend. Such dividend, if approved by the shareholders, will be accounted for in equity as an appropriation of retained earnings in the financial year ending 31 August 2019.

DIRECTORS’ REPORT


Directors of the Company

The directors of the Company in office since the beginning of the financial year to the date of this report are:

Tan Sri Dr Lim Wee Chai*Tan Sri Dato’ Seri Utama Arshad bin AyubTan Sri Rainer AlthoffDato’ Lee Kim Meow*Puan Sri Tong Siew Bee*Lim Hooi Sin*Lim Cheong Guan*Dato’ Lim Han BoonDatuk Noripah Binti KamsoSharmila SekarajasekaranTay Seong Chee, SimonDatuk Dr. Norma MansorLow Chin Guan* (appointed on 4 April 2018 and removed on 10 October 2018)

* These directors are also directors of the Company’s subsidiaries.

Directors of subsidiaries

The following is a list of directors of the subsidiaries (excluding directors who are also directors of the Company) in office during the financial year until the date of this report:

Dato’ IR Haji Ahmad Bin HassanDr. Pongsak KerdvonbunditChoh Ai YingChookiad UsahaHue Kon FahLew Sin ChiangLiew Say KeongLim Jin FengNg Wee ChongNg Yong LinOh Teik ChyePhattaraporn FueangthongPuon Tuck SengRavi A/L SupramaniamSaw Eng KooiSeah Chong ShewSee So Kim HuatSiow Chun MinMax Som Chai A/L PutianSvami Utama Batang TarisTan Chee HoongThomas PetermoellerWilawan SakulsongboonsiriWong Chong BanDr. Navindra A/L NageswaranHo Chee Meng EdmundMasato KatayamaHoong Hsuch LingTan Puay ChooLam Yat Hing (appointed on 30 October 2017)Ho Kim Nam (appointed on 30 October 2017)Leong Chew Mun (appointed on 21 February 2018)Zhu Bai HeVictor Daniel Angenscheidt Baridon

DIRECTORS’ REPORT(CONT’D)


Directors’ benefits

Neither at the end of the financial year, nor at any time during that year, did there subsist any arrangement to which the Company was a party, whereby the directors might acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate, other than those arising from the share options granted under the employee share options scheme (“ESOS”) and the employee share grant plan (“ESGP”).

Since the end of the previous financial year, no director has received or become entitled to receive a benefit (other than benefits included in the aggregate amount of emoluments received or due and receivable by the directors or the fixed salary of a full-time employee of the Company as shown below) by reason of a contract made by the Company or a related corporation with a director or with a firm of which the director is a member, or with a company in which the director has a substantial financial interest, except as disclosed in the Note 38 to the financial statements.

The directors’ benefits are as follows:


Salaries and other emoluments 9,555 3,292 Fees 1,256 1,202 Defined contribution plan 798 302Defined benefit plan 12 1 Share option granted under ESOS 302 161 Share option granted under ESGP 18 -Benefits-in-kind 211 50

12,152 5,008 * The Company maintains a liability insurance for directors of the Group. The total amount of sum insured for

the directors of the Group for the financial year amounted to RM5,000,000.

Directors’ interests

According to the register of directors’ shareholdings, the interests of directors in office at the end of the financial year in shares and options over shares in the Company during the financial year were as follows:

Number of ordinary shares 1 September 31 August 2017 Acquired Sold 2018

Tan Sri Dr Lim Wee Chai- direct 368,822,176 1,092,600 - 369,914,776 - indirect 88,206,208 15,400 1,000,000 87,221,608 Puan Sri Tong Siew Bee- direct 3,605,896 9,300 - 3,615,196 - indirect 453,422,488 1,098,700 1,000,000 453,521,188 Dato’ Lee Kim Meow - direct 620,100 266,700 400,000 486,800 - indirect 20,000 - - 20,000 Lim Hooi Sin- direct 20,281,824 - 1,000,000 19,281,824 - indirect 436,735,660 1,101,900 - 437,837,560 Lim Cheong Guan- direct 8,000 288,800 148,000 148,800 Tan Sri Dato’ Seri Utama Arshad bin Ayub- direct 900,000 - 100,000 800,000 - indirect 100,000 - 100,000 - Low Chin Guan- direct 400 - - 400 - indirect - 20,505,000 10,252,500 10,252,500 Sharmila Sekarajasekaran- direct - 5,000,000 - 5,000,000



Directors’ interests (Cont’d)

Number of options over ordinary shares 1 September 31 August 2017 Granted Exercised 2018

Tan Sri Dr Lim Wee Chai 92,600 185,000 92,600 185,000 Puan Sri Tong Siew Bee 9,300 9,100 9,300 9,100 Dato’ Lee Kim Meow 266,700 61,000 266,700 61,000 Lim Hooi Sin - 24,600 - 24,600 Lim Cheong Guan 288,800 54,400 288,800 54,400

Tan Sri Dr Lim Wee Chai, Puan Sri Tong Siew Bee and Lim Hooi Sin by virtue of their interest in shares of the Company are also deemed interested in shares of all the subsidiaries to the extent the Company has an interest.

None of the other directors in office at the end of the financial year had any interest in shares in the Company or its related corporations during the financial year.

Issue of shares

During the financial year, the Company increased its issued and paid-up ordinary share capital from RM636,644,000 to RM787,709,000 by way of:

(i) issuance of 3,425,000 ordinary shares pursuant to the Company’s ESOS at an option price between RM1.76 to RM10.12 per ordinary share; and

(ii) the issuance of 20,505,000 ordinary shares through a private placement at an issue price of RM6.68 per ordinary share, as partial discharge of purchase consideration for the acquisition of a subsidiary.

The new ordinary shares issued during the financial year ranked pari passu in all respects with the existing ordinary shares of the Company.

Employee share options scheme (“ESOS”)

At an Extraordinary General Meeting held on 9 January 2018, shareholders approved the ESOS for the granting of non-transferable options that are settled by physical delivery of the ordinary shares of the Company, to the eligible employees and executive directors respectively of the Company and its subsidiaries.

The committee administering the ESOS comprise two executive directors, Tan Sri Dr Lim Wee Chai and Lim Cheong Guan; four independent non-executive directors Dato’ Lim Han Boon, Datuk Noripah Binti Kamso, Sharmila Sekarajasekaran and Datuk Dr. Norma Mansor and one management staff Lim Jin Feng.

The salient features and other terms of the ESOS are disclosed in Note 37(i) to the financial statements.

During the financial year, the Company granted 3,166,600 share options under New Employee Share Option scheme. These options expire on 31 May 2028 and are exercisable if the employee has not served a notice of resignation or receive a notice of termination from the date of grant and certain conditions as detailed in Note 37(i) to the financial statements are met.




Employee share options scheme (“ESOS”) (Cont’d)

Details of the options exercised to subscribe for ordinary shares of the Company pursuant to the ESOS as at 31 August 2018 are as follows:

Exercise Number of price options Expiry date RM ’000

1 August 2018 1.76 49.6 1 August 2018 2.82 12.0 1 August 2018 2.90 1,506.8 1 August 2018 3.49 23.2 1 August 2018 3.08 129.2 1 August 2018 3.06 39.0 1 August 2018 3.43 31.6 1 August 2018 3.26 12.8 1 August 2018 2.08 21.4 1 August 2018 2.76 262.6 1 August 2018 2.32 394.1 1 August 2018 5.33 938.4 31 May 2028 10.12 4.7

3,425.4

Details of shares granted to directors are disclosed in the section on Directors’ Interest in this report.

Employee share grant plan (“ESGP”)

At an Extraordinary General Meeting held on 6 January 2016, shareholders approved ESGP for the eligible employees and executive directors of the Company and its subsidiaries.

The committee administering the ESGP comprise two executive directors, Tan Sri Dr Lim Wee Chai and Lim Cheong Guan; four independent non-executive directors Dato’ Lim Han Boon, Datuk Noripah Binti Kamso, Sharmila Sekarajasekaran and Datuk Dr. Norma Mansor and one management staff Lim Jin Feng.

The salient features and other terms of the ESGP are disclosed in Note 37(ii) to the financial statements.

During the financial year, the Company granted 93,700 share grant under ESGP amounted RM975,000 for employee and the certain conditions as detailed in Note 37(ii) to the financial statements.

Details of shares granted to directors are disclosed in the section on Directors’ Interest in this report.

Treasury shares

During the financial year, the Company transferred 93,700 treasury shares to eligible employees under employee share grant scheme at average market price of RM10.40 per share. The total transferred treasury shares net of transaction costs were RM975,000. The difference between the transferred treasury shares and the cost of the treasury shares amounted to RM561,000 was recognised in equity.

As at 31 August 2018, the Company held as treasury shares a total of 2,071,000 of its 1,280,229,000 issued ordinary shares. Such treasury shares are held at a carrying amount of RM9,325,000 and further relevant details are disclosed in Note 34 to the financial statements.

Other statutory information

(a) Before the statements of comprehensive income and statements of financial position of the Group and of the Company were made out, the directors took reasonable steps:

(i) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of provision for doubtful debts and satisfied themselves that all known bad debts had been written off and that adequate provision had been made for doubtful debts; and

(ii) to ensure that any current assets which were unlikely to realise their value as shown in the accounting records in the ordinary course of business had been written down to an amount which they might be expected so to realise.



Other statutory information (Cont’d)

(b) At the date of this report, the directors are not aware of any circumstances which would render:

(i) the amount written off for bad debts or the amount of the provision for doubtful debts in the financial statements of the Group and of the Company inadequate to any substantial extent; and

(ii) the values attributed to the current assets in the financial statements of the Group and of the Company misleading.

(c) At the date of this report, the directors are not aware of any circumstances which have arisen which would render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate.

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

(e) At the date of this report, there does not exist:

(i) any charge on the assets of the Group or of the Company which has arisen since the end of the financial year which secures the liabilities of any other person; or

(ii) any contingent liability of the Group or of the Company which has arisen since the end of the financial year.

(f) In the opinion of the directors:

(i) no contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve months after the end of the financial year which will or may affect the ability of the Group or of the Company to meet their obligations when they fall due; and

(ii) no item, transaction or event of a material and unusual nature has arisen in the interval between the end of the financial year and the date of this report which is likely to affect substantially the results of the operations of the Group or of the Company for the financial year in which this report is made.

Significant events

In addition to the significant events disclosed elsewhere in this report, other significant events are disclosed in Note 19 to the financial statements.

Subsequent events

Details of subsequent events are disclosed in Note 47 to the financial statements.

Auditors

The auditors, Ernst & Young, have expressed their willingness to continue in office.

Auditors’ remuneration is as follows:


Ernst & Young 316 85Other auditors 583 -

899 85

To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its audit engagement against claims by third parties arising from the audit. No payment has been made to indemnify Ernst & Young for the financial year ended 31 August 2018.

Signed on behalf of the Board in accordance with a resolution of the directors dated 31 October 2018.

Dato’ Lee Kim Meow Dato’ Lim Han Boon


We, Dato’ Lee Kim Meow and Dato’ Lim Han Boon, being two of the directors of Top Glove Corporation Bhd., do hereby state that, in the opinion of the directors, the accompanying financial statements set out on pages 106 to 186 are drawn up in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Company as at 31 August 2018 and of their financial performance and cash flows for the year then ended.

Signed on behalf of the Board in accordance with a resolution of the directors dated 31 October 2018.

Dato’ Lee Kim Meow Dato’ Lim Han Boon

I, Dato’ Lee Kim Meow, being the director primarily responsible for the financial management of Top Glove Corporation Bhd., do solemnly and sincerely declare that the accompanying financial statements set out on pages 106 to 186 are in my opinion correct, and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960.

Dato’ Lee Kim Meow

Before me,

Sirendar Singh Commissioner for Oaths

STATEMENT BY DIRECTORSPURSUANT TO SECTION 251(2) OF THE COMPANIES ACT 2016

STATUTORY DECLARATIONPURSUANT TO SECTION 251(1)(b) OF THE COMPANIES ACT 2016

Subscribed and solemnly declared by the abovenamed, Dato’ Lee Kim Meow at Shah Alam in the State of Selangoron 31 October 2018


INDEPENDENT AUDITORS’ REPORTTO THE MEMBERS OF TOP GLOVE CORPORATION BHD.[INCORPORATED IN MALAYSIA]

Report on the audit of the financial statements

Opinion We have audited the financial statements of Top Glove Corporation Bhd., which comprise the statements of financial position as at 31 August 2018 of the Group and of the Company, and statements of profit or loss and other comprehensive income, statements of changes in equity and statements of cash flows of the Group and of the Company for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, as set out on pages 106 to 186. In our opinion, the accompanying financial statements give a true and fair view of the financial position of the Group and of the Company as at 31 August 2018, and of their financial performance and their cash flows for the year then ended in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia.

Basisforopinion We conducted our audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing. Our responsibilities under those standards are further described in the Auditors’responsibilitiesfortheauditofthefinancialstatements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Independenceandotherethicalresponsibilities We are independent of the Group and of the Company in accordance with the By-Laws (on Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants (“By-Laws”) and the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (“IESBA Code”), and we have fulfilled our other ethical responsibilities in accordance with the By-Laws and the IESBA Code.

Keyauditmatters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the Group and of the Company for the current year. We have determined that there are no key audit matters to communicate in our report on the financial statements of the Company. The key audit matters for the audit of the financial statements of the Group are described below. These matters were addressed in the context of our audit of the financial statements of the Group as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.

We have fulfilled the responsibilities described in the Auditors’ responsibilities for the audit of the financialstatements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis of our audit opinion on the accompanying financial statements.

Review of costing of inventories(Refer to Notes 4.15, 7.2(a) and 24 to the financial statements)

At 31 August 2018, the Group held RM508 million of inventories which represent approximately 10% of total assets of the Group. Total cost of inventory charged to the consolidated income statement for the year ended 31 August 2018 amounted to RM3,368 million, accounted for 91% of total expenditure of the Group. Inventories are carried at the lower of cost and net realisable value. The cost of inventories comprises the cost of purchase of raw materials, direct labour, plus conversion costs such as variable and fixed overhead.

The inventory cost is recorded and computed via the SAP system, after incorporating actual costs from a variety of inputs. As the computation and cost allocation process involve multiple inputs and management’s judgement, the costing of inventories is considered complex and hence is a key area of audit focus.

Our audit procedures performed, amongst others are as follows:

a) Obtained an understanding of the current inventories valuation policy and its related processes in allocating, recording and computing the cost of inventories.

b) Performed walkthrough on the processes and reviewed the computation of standard costing of inventory. We have also observed the procedures of updating the standard cost into the SAP system.


Review of costing of inventories (Cont’d)

c) Performed walkthrough and tested controls over the recording of cost of purchases, which includes the raw materials, direct labour, and allocation of overheads, into the SAP system.

d) Assessed the general and logical access controls surrounding the data input process of the SAP system by involving our IT audit professionals.

Annual impairment test of goodwill arising from the acquisition of Aspion Sdn. Bhd. (“Aspion”)(Refer to Notes 4.1, 7.2(b) and 23 to the financial statements)

As at 31 August 2018, the Group recorded a provisional goodwill of RM1,258 million arising from the acquisition of Aspion, which represents 24% of the Group’s total assets. The goodwill amount has been allocated to cash generating unit (“CGU”) on a provisional basis for impairment testing purposes. The Group estimated the recoverable amount of the CGU to which the goodwill is allocated based on value-in-use (“VIU”).

Given its magnitude and the significant judgement involved in the annual impairment test, we consider this impairment test to be an area of audit focus. Specifically, we focus on the evaluation of the assumptions on the amount and timing of cash flows which are based on internal (e.g. budgets) and external market data (e.g. country specific interest rates and inflation percentages), and determination of an appropriate discount rate for Aspion.

Our audit procedures performed, amongst others are as follows:

a) Evaluated management’s key assumptions used in the cash flows projection, focusing on projected revenue, profit margins and growth rates, taking into consideration the current and expected future economic conditions. We compared the projected revenue to the past trends and compared expected growth rates to relevant market expectations.

b) Together with EY valuation specialists, we evaluated the discount rate used to determine the present value of the cash flows and assessed whether the rate used reflect the current market assessment of the time value of money and the risk specific to the asset is the return that the investors would require if they were to choose an investment that would generate cash flows of amounts, timing and risk profile equivalent to those that the entity expects to derive from the asset.

c) Assessed the sensitivity of the cash flows to changes in the key inputs to understand the impact that reasonable alternative assumptions would have on the overall carrying value.

d) Evaluated the adequacy of the Group’s disclosures in the financial statements concerning those key assumptions to which the outcome of the impairment test is most sensitive.

Informationotherthanthefinancialstatementsandauditors’reportthereon

The directors of the Company are responsible for the other information. The other information comprises the information included in the annual report, but does not include the financial statements of the Group and of the Company and our auditors’ report thereon. Our opinion on the financial statements of the Group and of the Company does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements of the Group and of the Company, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements of the Group and of the Company or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

INDEPENDENT AUDITORS’ REPORTTO THE MEMBERS OF TOP GLOVE CORPORATION BHD.[INCORPORATED IN MALAYSIA] (CONT’D)



Responsibilitiesofthedirectorsforthefinancialstatements

The directors of the Company are responsible for the preparation of financial statements of the Group and of the Company that give a true and fair view in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia. The directors are also responsible for such internal control as the directors determine is necessary to enable the preparation of financial statements of the Group and of the Company that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements of the Group and of the Company, the directors are responsible for assessing the Group’s and the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the Company or to cease operations, or have no realistic alternative but to do so.

Auditors’responsibilitiesfortheauditofthefinancialstatements

Our objectives are to obtain reasonable assurance about whether the financial statements of the Group and of the Company as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with approved standards on auditing in Malaysia and International Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements of the Group and of the Company, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s and of the Company’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.

• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s or the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements of the Group and of the Company or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group or the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements of the Group and of the Company, including the disclosures, and whether the financial statements of the Group and of the Company represent the underlying transactions and events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial statements of the Group. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.


Auditors’responsibilitiesfortheauditofthefinancialstatements(Cont’d)

From the matters communicated with the directors, we determine those matters that were of most significance in the audit of the financial statements of the Group and of the Company for the current year and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on other legal and regulatory requirements

In accordance with the requirements of the Companies Act 2016 in Malaysia, we report that the subsidiaries of which we have not acted as auditors, are disclosed in Note 19 to the financial statements.

Other matters

This report is made solely to the members of the Company, as a body, in accordance with Section 266 of the Companies Act 2016 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.

Ernst & Young Ng Kim LingAF: 0039 No. 03236/04/2020 JChartered Accountants Chartered Accountant

Kuala Lumpur, Malaysia31 October 2018



STATEMENTS OF PROFIT OR LOSSFOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018

Group Company Note 2018 2017 2018 2017 (Restated) RM’000 RM’000 RM’000 RM’000

Revenue 8 4,214,482 3,409,176 243,942 333,815 Cost of sales (3,367,611) (2,803,857) - -

Gross profit 846,871 605,319 243,942 333,815

Other items of income Interest income 9 12,256 17,232 217 1,861 Other income 10 39,752 53,488 - 10

Other items of expense Distribution and selling costs (111,692) (90,250) - - Administrative and general expenses (224,968) (193,452) (10,400) (8,413) Finance costs (35,321) (6,314) - -

Share of results of associates 1,697 (980) - -

Profit before tax 11 528,595 385,043 233,759 327,273 Income tax expense 14 (90,689) (54,514) - -

Profit net of tax 437,906 330,529 233,759 327,273

Profit attributable to:Owners of the parent 434,215 330,664 233,759 327,273 Non-controlling interests 3,691 (135) - -

437,906 330,529 233,759 327,273

Earnings per share attributable to owners of the parent (sen):

Before issuance of bonus shares - Basic 15 33.92 26.38 - Diluted 15 33.92 26.36

After issuance of bonus shares - Basic 15 16.97 13.06 - Diluted 15 16.97 13.06

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.


STATEMENTS OF COMPREHENSIVE INCOMEFOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018

Group Company 2018 2017 2018 2017 (Restated) RM’000 RM’000 RM’000 RM’000

Profit net of tax 437,906 330,529 233,759 327,273

Other comprehensive (loss)/income:Tobereclassifiedtoprofitorlossinsubsequent periods:Net movement on available-for-sale financial assets (2,465) 5,609 - -Cash flow hedges (Note 35) (41,504) - - -Foreign currency translation differences of foreign operations (17,741) 30,041 - -Foreign currency translation differences of associate - (1,252) - -

Other comprehensive (loss)/income for the year, net of tax (61,710) 34,398 - -

Total comprehensive income for the year 376,196 364,927 233,759 327,273

Total comprehensive income attributable to:Owners of the parent 372,671 364,297 233,759 327,273Non-controlling interests 3,525 630 - -

376,196 364,927 233,759 327,273



STATEMENT OF FINANCIAL POSITION (GROUP)

AS AT 31 AUGUST 2018

As at Note 2018 2017 1.9.2016 (Restated) (Restated) RM’000 RM’000 RM’000

Assets

Non-current assets Property, plant and equipment 16 2,064,817 1,498,486 1,128,937 Land use rights 17 101,675 40,457 39,461 Investment property 18 163,900 162,000 162,000 Investment in an associate 20 1,697 - 3,961 Deferred tax assets 21 14,288 14,681 7,081 Investment securities 22 392 392 145 Goodwill 23 1,304,496 22,805 22,805

3,651,265 1,738,821 1,364,390

Current assets Inventories 24 508,186 315,775 263,679 Trade and other receivables 25 646,179 419,349 345,700 Other current assets 26 106,380 51,258 24,179 Tax recoverable - 17,351 - Investment securities 22 193,714 206,910 479,081 Derivative financial instruments 27 - 645 - Cash and bank balances 28 164,836 240,068 224,099

1,619,295 1,251,356 1,336,738

Total assets 5,270,560 2,990,177 2,701,128

Equity and liabilities

Current liabilitiesLoans and borrowings 29 882,575 314,644 317,796 Trade and other payables 30 499,685 418,802 332,199 Other current liabilities 31 59,248 62,292 39,368 Income tax payable 8,680 - 1,357 Derivative financial instruments 27 856 - 189

1,451,044 795,738 690,909

Net current assets 168,251 455,618 645,829


STATEMENT OF FINANCIAL POSITION (GROUP)

AS AT 31 AUGUST 2018 (CONT’D)

As at Note 2018 2017 1.9.2016 (Restated) (Restated) RM’000 RM’000 RM’000

Non-current liabilitiesLoans and borrowings 29 1,330,359 61,750 81,637 Deferred tax liabilities 21 94,670 68,257 52,885 Provisions 719 - -

1,425,748 130,007 134,522

Total liabilities 2,876,792 925,745 825,431

Net assets 2,393,768 2,064,432 1,875,697

Equity attributable to owners of the parent

Share capital 32 787,709 636,644 627,406 Share premium 33 - - 4,781 Treasury shares 34 (9,325) (9,739) (9,739)Other reserves 35 4,551 62,499 28,508 Retained earnings 1,595,546 1,365,827 1,216,915

2,378,481 2,055,231 1,867,871 Non-controlling interests 15,287 9,201 7,826

Total equity 2,393,768 2,064,432 1,875,697

Total equity and liabilities 5,270,560 2,990,177 2,701,128



STATEMENT OF FINANCIAL POSITION (COMPANY)

AS AT 31 AUGUST 2018

Note 2018 2017 RM’000 RM’000

Assets

Non-current assetInvestment in subsidiaries 19 1,018,960 830,503

Current assetsTrade and other receivables 25 2,000 174 Other current assets 26 1,071 - Tax recoverable 12 16 Investment securities 22 2 2,583 Cash and bank balances 28 151 484

3,236 3,257

Total assets 1,022,196 833,760

Equity and liabilities

Current liabilitiesTrade and other payables 30 1,508 2,565 Other current liabilities 31 1 1

Total liabilities 1,509 2,566

Net current assets 1,727 691

Net assets 1,020,687 831,194

Equity attributable to owners of the Company

Share capital 32 787,709 636,644 Treasury shares 34 (9,325) (9,739)Other reserves 35 1,929 2,568 Retained earnings 36 240,374 201,721

Total equity 1,020,687 831,194

Total equity and liabilities 1,022,196 833,760



STATEMENTS OF CHANGES IN EQUITY

FOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018

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FOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018

Non-distributable Distributable Share Total Share Share Treasury option Retained equity capital premium shares reserve earnings RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

2018 Company

Opening balance at 1 September 2017 831,194 636,644 - (9,739) 2,568 201,721

Total comprehensive income 233,759 - - - - 233,759

Transactions with ownersIssuance of ordinary shares pursuant to ESOS (Note 37) 11,972 11,972 - - - - Issuance of ordinary shares (Note 32) 137,000 137,000 - - - - Share options granted under ESOS (Note 35) 1,932 - - - 1,932 - Transfer from share option reserve (Note 35) - 2,093 - - (2,093) - Transfer to retained earnings (Note 35) - - - - (478) 478 Transfer to ESGP 975 - - 414 - 561 Dividends on ordinary shares (Note 44) (196,145) - - - - (196,145)

Total transactions with owners (44,266) 151,065 - 414 (639) (195,106)

Closing balance at 31 August 2018 1,020,687 787,709 - (9,325) 1,929 240,374

2017Company

Opening balance at 1 September 2016 680,918 627,406 4,781 (9,739) 2,861 55,609 Total comprehensive income 327,273 - - - - 327,273 Transactions with owners Issuance of ordinary shares pursuant to ESOS (Note 37) 4,179 3,128 1,051 - - - Share options granted under ESOS (Note 35) 578 - - - 578 - Transfer from share option reserve (Note 35) - - 278 - (278) - Transition to no-par value regime - 6,110 (6,110) - - - Transfer to retained earnings (Note 35) - - - - (593) 593 Dividends on ordinary shares (Note 44) (181,754) - - - - (181,754)

Total transactions with owners (176,997) 9,238 (4,781) - (293) (181,161)

Closing balance at 31 August 2017 831,194 636,644 - (9,739) 2,568 201,721



STATEMENTS OF CASH FLOWSFOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018


Operating activitiesProfit before tax 528,595 385,043 233,759 327,273 Adjustments for : Gross dividends - - (239,030) (329,505) Depreciation on property plant and equipment (Note 16) 141,105 106,037 - - Amortisation of land use rights (Note 17) 1,298 734 - - Loss/(gain) on disposal of property, plant and equipment 904 (3,087) - - Gain on disposal of land use right (4,664) - - - Net loss from fair value remeasurement on investment property (Note 18) 721 3,096 - - Bad debts written off - 1,355 - - Gain on disposal of debt securities (273) (4,032) - - Gain on disposal of an associate - (1,205) - - Property, plant and equipment written off 8,025 5,790 - - Shares granted under ESGP 975 2,359 - 53 Share options granted under ESOS 1,932 578 167 41 Unrealised foreign exchange loss 19,630 21,490 - - Share of results of an associate (1,697) 980 - - Net fair value loss/(gain) on derivatives 2,262 (829) - - Finance costs 35,321 6,314 - - Interest income (12,256) (17,232) (217) (1,861)

Total adjustments 193,283 122,348 (239,080) (331,272)

Operating cash flows before changes in working capital 721,878 507,391 (5,321) (3,999)Changes in working capitalIncrease in inventories (106,584) (52,096) - - (Increase)/decrease in receivables (95,752) (83,129) (1,071) 20 Increase in other current assets (55,122) (27,079) - - (Decrease)/increase in payables (34,946) 109,656 (1,057) 310

Total changes in working capital (292,404) (52,648) (2,128) 330

Cash flows from/(used in) operations 429,474 454,743 (7,449) (3,669)Interest paid (35,321) (6,314) - - Purchase of shares for ESGP - (2,366) - - Income taxes (paid)/refunded (52,194) (65,473) 4 (13)Proceeds from government grant - 496 - -

Net cash flows generated from/(used in) operating activities 341,959 381,086 (7,445) (3,682)


STATEMENTS OF CASH FLOWSFOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018 (CONT’D)


Investing activitiesPurchase of property, plant and equipment (458,812) (479,252) - - Purchase of land use rights (341) (1,536) - - Additions to investment property (2,621) (2,106) - - Purchase of investment securities (170,408) (51,269) (95,296) (1,486)Proceeds from disposal of investment securities 179,953 320,892 97,877 99,066 Proceeds from disposal of land use rights 9,306 - - - Decrease/(increase) in bank balances pledged with banks (913) (606) - - Interest received 12,256 17,232 217 1,861 Dividends from subsidiaries - - 239,030 329,505 Dividend from an associate - 787 - - Proceeds from disposal of property, plant and equipment 9,610 17,404 - - Additional investment in golf club membership - (247) - - Additional investment in subsidiaries - - (51,457) (250,000)Acquisition of equity interest of NCI (3,944) - - - Net cash outflow on acquisition of subsidiaries (1,270,542) - - - Net cash inflow on disposal of an associate - 2,034 - - Repayment from subsidiaries - - 914 2,547

Net cash flows (used in)/generated from investing activities (1,696,456) (176,667) 191,285 181,493

Financing activitiesProceeds from issuance of ordinary shares pursuant to ESOS 11,972 4,179 11,972 4,179 Dividends paid on ordinary shares (Note 44) (196,145) (181,729) (196,145) (181,754)Dividends paid on non-controlling interest (5,418) - - - Issuance of shares to non-controlling interest 1,500 780 - - Repayment of loans and borrowings (292,402) (154,637) - - Drawdown of loans and borrowings 1,763,644 126,074 - -

Net cash flows generated from/(used in) financing activities 1,283,151 (205,333) (184,173) (177,575)

Net (decrease)/increase in cash and cash equivalents (71,346) (914) (333) 183 Effect of changes in foreign exchange rate (4,799) 16,277 - - Cash and cash equivalents at 1 September 2017/2016 238,519 223,156 431 248

Cash and cash equivalents at 31 August (Note 28) 162,374 238,519 98 431


STATEMENTS OF CASH FLOWSFOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018 (CONT’D)

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1. Corporate information

Top Glove Corporation Bhd. (“the Company”) is a public limited liability company incorporated and domiciled in Malaysia, and is listed on the Main Market of Bursa Malaysia Securities Berhad and Singapore Exchange Securities Trading Limited. The principal place of business of the Company is located at Level 21, Top Glove Tower, 16, Persiaran Setia Dagang, Setia Alam, Seksyen U13, 40170 Shah Alam, Selangor.

The principal activities of the Company are investment holding and provision of management services. The principal activities of the subsidiaries are described in Note 19. There have been no significant changes in the nature of the principal activities during the financial year.

2. Basis of preparation

These financial statements of the Group and of the Company have been prepared in accordance with Malaysian Financial Reporting Standards (“MFRS”) as issued by the Malaysian Accounting Standards Board (“MASB”), International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board and the requirements of the Companies Act 2016 in Malaysia.

The financial statements have also been prepared on a historical basis, unless otherwise indicated in the accounting policies below.

The financial statements are presented in Ringgit Malaysia (“RM”) and all values are rounded to the nearest thousand (RM’000) except when otherwise indicated.

During the financial year, the Group has re-assessed the current accounting policies and elected to change its accounting policy on measurement of the Group’s investment properties from the cost model to the fair value model. The effect of the change in accounting policies is accounted for retrospectively. Further details are disclosed in Note 48. Except for this change in accounting policy, the accounting policies and presentation adopted for this financial report are consistent with those adopted for the audited financial statements for the financial year ended 31 August 2017.

3. Basis of consolidation

The consolidated financial statements comprise the financial statements of the Company and of its subsidiaries as at 31 August 2018 and 2017. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee if and only if the Group has:

- Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee);

- Exposure, or rights, to variable returns from its involvement with the investee; and

- The ability to use its power over the investee to affect its returns

When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including:

- The contractual arrangement with the other vote holders of the investee;

- Rights arising from other contractual arrangements; and

- The Group’s voting rights and potential voting rights.

The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in profit or loss from the date the Group gains control until the date the Group ceases to control the subsidiary.

Profit or loss and each component of other comprehensive income (“OCI”) are attributed to the equity holders of the parent of the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit balance. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the Group’s accounting policies. All intra-group assets and liabilities, equity, income, expenses, unrealised gains and losses and cash flows relating to transactions between members of the Group are eliminated in full on consolidation.

NOTES TO THE FINANCIAL STATEMENTSFOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018


3. Basis of consolidation (Cont’d)

A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.

If the Group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities, non-controlling interest and other components of equity while any resultant gain or loss is recognised in profit or loss. Any investment retained is recognised at fair value.

4. Summary of significant accounting policies

4.1 Business combinations and goodwill

Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the consideration transferred, measured at acquisition date fair value and the amount of any non-controlling interest in the acquiree. For each business combination, the Group elects whether it measures the non-controlling interest in the acquiree either at fair value or at the proportionate share of the acquiree’s identifiable net assets. Acquisition-related costs are expensed as incurred and included in administrative expenses.

When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date. This includes the separation of embedded derivatives in host contracts by the acquiree.

If the business combination is achieved in stages, any previously held equity interests in the acquiree are re-measured to fair value at the acquisition date with any corresponding gain or loss recognised in profit or loss.

Any excess of the cost of business combination, as the case may be, over the net amount of the fair value of identifiable assets acquired and liabilities assumed is recognised as goodwill. For business combinations, provisions are made for the acquiree’s contingent liabilities existing at the date of acquisition as the Group deems that it is probable that an outflow of resources embodying economic benefits will be required to settle the obligations.

Any excess in the Group’s interest in the net fair value of the identifiable assets acquired and liabilities assumed over the cost of business combination is recognised immediately in profit or loss.

Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the acquisition date. Contingent consideration classified as an asset or liability that is a financial instrument and within the scope of MFRS 139 Financial Instruments: Recognition and Measurement, is measured at fair value with changes in fair value recognised either in profit or loss or as a change to Other Comprehensive Income (“OCI”). If the contingent consideration is not within the scope of MFRS 139, it is measured in accordance with the appropriate MFRS. Contingent consideration that is classified as equity is not re-measured and subsequent settlement is accounted for within equity.

Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred and the amount recognised for non-controlling interests, and any previous interest held, over the net identifiable assets acquired and liabilities assumed. If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the Group re-assesses whether it has correctly identified all of the assets acquired and all of the liabilities assumed and reviews the procedures used to measure the amounts to be recognised at the acquisition date. If the re-assessment still results in an excess of the fair value of net assets acquired over the aggregate consideration transferred, then the gain is recognised in profit or loss.

After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Group’s cash-generating units that are expected to benefit from the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units.

Where goodwill has been allocated to a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the disposed operation is included in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill disposed in these circumstances is measured based on the relative values of the disposed operation and the portion of the cash-generating unit retained.

NOTES TO THE FINANCIAL STATEMENTSFOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018 (CONT’D)


4. Summary of significant accounting policies (Cont’d)

4.1 Business combinations and goodwill (Cont’d)

Business combinations involving entities under common control are accounted for by applying the pooling on interest method. The assets and liabilities of the combining entities are reflected at their carrying amounts reported in the consolidated financial statements of the controlling holding company. Any difference between the consideration paid and the share capital of the entity acquired is reflected within equity as merger reserve. The statement of comprehensive income reflects the results of the combining entities for the full year, irrespective of when the combination takes place. Comparatives are presented as if the entities have always been combined since the date the entities had come under common control.

4.2 Transactions with non-controlling interests

Non-controlling interests represent the equity in subsidiaries not attributable, directly or indirectly, to owners of the Company, and is presented separately in the consolidated income statement, consolidated statement of comprehensive income and within equity in the consolidated statement of financial position, separately from equity attributable to owners of the Company.

Changes in the Company’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. In such circumstances, the carrying amounts of the controlling and non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiary. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to owners of the parent.

4.3 Investment in subsidiaries

A subsidiary is an entity over which the Group has all the following:

(i) Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee);

(ii) Exposure, or rights, to variable returns from its involvement with the investee; and

(iii) The ability to use its power over the investee to affect its returns.

In the Company’s separate financial statements, investment in subsidiaries is accounted for at cost less impairment losses. On disposal of such investment, the difference between net disposal proceeds and the carrying amount is included in profit or loss.

4.4 Investment in associates

An associate is an entity, not being a subsidiary or a joint venture, in which the Group has significant influence. An associate is equity accounted for from the date the Group obtains significant influence until the date the Group ceases to have significant influence over the associate.

The Group’s investment in associates is accounted for using the equity method of accounting. Under the equity method, the investment in associates is measured in the consolidated statement of financial position at cost plus post-acquisition changes in the Group’s share of net assets of the associates. Goodwill relating to associates is included in the carrying amount of the investment. Any excess of the Group’s share of the net fair value of the associate’s identifiable assets, liabilities and contingent liabilities over the cost of the investment is excluded from the carrying amount of the investment and is instead included as income in the determination of the Group’s share of the associate’s profit or loss for the period in which the investment is acquired.

When the Group’s share of losses in an associate equals or exceeds its interest in the associate, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.

After application of the equity method, the Group determines whether it is necessary to recognise an additional impairment loss on the Group’s investment in its associates. The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount in profit or loss.




4.4 Investment in associates (Cont’d)

The financial statements of the associates are prepared as of the same reporting date as the Group unless it is impracticable to do so. When the financial statements of associates used in applying the equity method are prepared as of a different reporting date from that of the Group, adjustments are made for the effects of significant transactions or events that occur between that date and the reporting date of the Group. When necessary, adjustments are made to bring the accounting policies in line with those of the Group.

In the Group’s separate financial statements, investment in associate is stated at cost less impairment losses. On disposal of such investment, the difference between net disposal proceeds and the carrying amount is included in profit or loss.

4.5 Current versus non-current classification

Assets and liabilities in the statements of financial position are presented based on a current/non-current classification. An asset is current when it is:

- Expected to be realised or intended to be sold or consumed in the normal operating cycle;

- Held primarily for the purpose of trading;

- Expected to be realised within twelve months after the reporting period, or

- Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is current when:

- It is expected to be settled in the normal operating cycle;

- It is held primarily for the purpose of trading;

- It is due to be settled within twelve months after the reporting period; or

- There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities.

4.6 Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

- In the principal market for the asset or liability; or

- In the absence of a principal market, in the most advantageous market for the asset or liability.

The principal or the most advantageous market must be accessible to by the Group.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.




4.6 Fair value measurement (Cont’d)

Valuation techniques that are appropriate in the circumstances and for which sufficient data are available, are used to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognised in the financial statements on a recurring basis, the Group determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

Policies and procedures are determined by senior management for both recurring fair value measurement and for non-recurring measurement.

External valuers are involved for valuation of significant assets and significant liabilities. Involvement of external valuers is decided by senior management. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained. The senior management decides, after discussions with the external valuers, which valuation techniques and inputs to use for each case.

At each reporting date, the senior management analyses the movements in the values of assets and liabilities which are required to be re-measured or re-assessed according to the accounting policies of the Group. For this analysis, the senior management verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents.

The senior management, in conjunction with the external valuers, also compares the changes in the fair value of each asset and liability with relevant external sources to determine whether the change is reasonable.

For the purpose of fair value disclosures, classes of assets and liabilities are determined based on the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

4.7 Foreign currencies

(a) Functional and presentation currency

The Group’s and the Company’s financial statements are presented in RM which is also the Company’s functional currency. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency.

(b) Transactions and balances

Transactions in foreign currencies are initially recorded by the Group entities at the functional currency spot rates at the date the transaction first qualifies for recognition. Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates at the reporting date.




4.7 Foreign currencies (Cont’d)

(b) Transactions and balances (Cont’d)

Differences arising on settlement or translation of monetary items are recognised in profit or loss with the exception of monetary items that are designated as part of the hedge of the Group’s net investment of a foreign operation. These are recognised in foreign exchange reserve OCI until the net investment is disposed of, at which time, the cumulative amount is reclassified to profit or loss. Tax charges and credits attributable to exchange differences on those monetary items are also recorded in OCI.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of gain or loss on change in fair value of the item (i.e., translation differences on items whose fair value gain or loss is recognised in OCI or profit or loss are also recognised in OCI or profit or loss, respectively).

Any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition are treated as assets and liabilities of the foreign operation and translated at the spot rate of exchange at the reporting date.

(c) Group companies

On consolidation, the assets and liabilities of foreign operations are translated into RM at the rate of exchange prevailing at the reporting date and their statements of comprehensive income are translated at exchange rates prevailing at the dates of the transactions. The exchange differences arising on translation for consolidation are recognised in OCI. On disposal of a foreign operation, the component of OCI relating to that particular foreign operation is recognised in profit or loss.

4.8 Revenue and other income recognition

Revenue and other income are recognised to the extent that it is probable that the economic benefits will flow to the Group and the Company and the revenue and other income can be reliably measured, regardless of when the payment is being made. Revenue and other income are measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duty. The Group and the Company have concluded that they are the principals in all of their revenue arrangements since they are the primary obligors in all the revenue arrangements, have pricing latitude and are also exposed to inventory and credit risks.

The specific recognition criteria described below must also be met before revenue is recognised.

(a) Sale of goods

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on delivery of the goods.

(b) Dividend income

Dividend income is recognised when the Company’s right to receive payment is established.

(c) Management fees

Management fees are recognised when services are rendered.

(d) Interest income

For all financial instruments measured at amortised cost and interest bearing financial assets classified as available-for-sale and at fair value through profit or loss, interest income or expense is recorded using the effective interest rate (EIR), which is the rate that exactly discounts the estimated future cash payments or receipts through the expected life of the financial instrument or a shorter period, where appropriate, to the net carrying amount of the financial asset or liability.Interest income is included in finance income in profit or loss.




4.8 Revenue and other income recognition (Cont’d)

(e) Rental income

Rental income is accounted for on a straight-line basis over the lease terms. The aggregate costs of incentives provided to lessees are recognised as a reduction of rental income over the lease term on a straight-line basis.

4.9 Employee benefits

(a) Short term benefits

Wages, salaries, bonuses and social security contributions are recognised as an expense in the year in which the associated services are rendered by employees. Short term accumulating compensated absences such as paid annual leave are recognised when services are rendered by employees that increase their entitlement to future compensated absences. Short term non-accumulating compensated absences such as sick leave are recognised when the absences occur.

(b) Defined contribution plans

Defined contribution plans are post-employment benefit plans under which the Group and the Company pay fixed contributions into separate entities or funds and will have no legal or constructive obligation to pay further contributions if any of the funds do not hold sufficient assets to pay all employee benefits relating to employee services in the current and preceding financial years. Such contributions are recognised as an expense in profit or loss as incurred. As required by law, companies in Malaysia make such contributions to the Employees Provident Fund (“EPF”).

(c) Employee share option plans

Employees of the Group and of the Company receive remuneration in the form of share options as consideration for services rendered. The cost of these equity-settled transactions with employees is measured by reference to the fair value of the options at the date on which the options are granted. This cost is recognised in profit or loss. The cumulative expense recognised at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Group’s and the Company’s best estimate of the number of options that will ultimately vest. The charge or credit to profit or loss for a period represents the movement in cumulative expense recognised at the beginning and end of that period.

No expense is recognised for options that do not ultimately vest, except for options where vesting is conditional upon a market or non-vesting condition, which are treated as vested irrespective of whether or not the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are satisfied.

When the options are exercised, the employee share option reserve is transferred to share capital if new shares are issued.

The employee share option reserve is transferred to retained earnings upon forfeiture or expiry of the share options.

(d) Employee share grant plan (“ESGP”)

Employees of the Group and of the Company are entitled to performance based shares as consideration for services rendered. The ESGP may be settled by way of issuance or transfer of shares of the Company or by cash at the discretion of the ESGP Committee. Trusts have been set up and are administered by an appointed trustee (“ESGP Trusts”). The trustee will be entitled from time to time, to accept advances from the Group and the Company, upon such terms and conditions as the Group and the Company and the trustee may agree to purchase the ordinary shares of the Company (“Trust Shares”) from the open market for the ESGP Trusts. The value of the ESGP Awards granted to Eligible Employees is recognised as an employee cost.

The ESGP Trusts’ asset is consolidated into the Group’s consolidated financial statements. Dividends received by the ESGP Trusts are eliminated against the Company’s dividend payment.




4.10 Taxes

(a) Current income tax

Current income tax assets and liabilities for the current period are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date in the countries where the Group operates and generates taxable income.

Current income tax relating to items recognised directly in equity is recognised in equity and not in profit or loss. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

(b) Deferred tax

Deferred tax is provided using the liability method on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.

Deferred tax liabilities are recognised for all taxable temporary differences, except:

(i) where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

(ii) in respect of taxable temporary differences associated with investments in subsidiaries and associates, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised, except:

(i) where the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

(ii) in respect of deductible temporary differences associated with investments in subsidiaries, deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax assets to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax items are recognised in correlation to the underlying transaction either in other comprehensive income or directly in equity.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.




4.11 Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are expensed in the period they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

4.12 Property, plant and equipment

Property, plant and equipment are stated at cost, net of accumulated depreciation and/or accumulated impairment losses, if any. Such cost includes the cost of replacing component parts of the property, plant and equipment and borrowing costs for long-term construction projects if the recognition criteria are met.

When significant parts of property, plant and equipment are required to be replaced at intervals, the Group derecognises the replaced part, and recognises the new part with its own associated useful life and depreciation. Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in the profit or loss as incurred. The present value of the expected cost for the decommissioning of the asset after its use is included in the cost of the respective asset if the recognition criteria for a provision are met.

Freehold land has an unlimited useful life and therefore is not depreciated. Capital work in-progress are not depreciated as these assets are not available for use. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets as follows:

Buildings 20 to 50 years Plant and equipment 10 years Other assets 5 to 10 years

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss on derecognition of the asset is included in the profit or loss in the year the asset is derecognised.

The assets’ residual values, useful lives and methods of depreciation are reviewed at each financial year end and adjusted prospectively, if appropriate.

4.13 Investment property

Investment property is property which is held either to earn rental income or for capital appreciation or for both. Investment property is initially measured at cost, including transaction costs. Subsequent to initial recognition, investment property is measured at fair value which reflects market conditions at the reporting date. Fair value is arrived at using the investment method that makes reference to estimated market rental values and equivalent yields. Valuation is performed by accredited independent valuer having an appropriate recognised professional qualification and recent experience in the location and category of the properties being valued. Gains or losses arising from changes in the fair values of investment property is included in profit or loss in the year in which they arise.

Subsequent expenditure is included in the investment property’s carrying amount only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance costs are recognised in profit or loss during the financial period in which they are incurred.

Investment property is derecognised either when it has been disposed of or when it is permanently withdrawn from use and no future economic benefit is expected from its disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in the profit or loss in the period of derecognition.

Transfers are made to (or from) investment property only when there is a change in use. For a transfer from investment property to owner-occupied property, the deemed cost for subsequent accounting is the carrying amount at the date of change in use. For a transfer from owner-occupied property to investment property, the property is accounted for in accordance with the accounting policy for property, plant and equipment set out in Note 4.12 up to the date of change in use.




4.14 Leases

The determination of whether an arrangement is, or contains, a lease is based on the substance of the arrangement at the inception date, whether fulfilment of the arrangement is dependent on the use of a specific asset or assets or the arrangement conveys a right to use the asset, even if that right is not explicitly specified in an arrangement.

(a) Group as lessee

Finance leases which transfer to the Group substantially all the risks and benefits incidental to ownership of the leased item, are capitalised at the commencement of the lease at the fair value of the leased property or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognised in finance costs in profit or loss.

A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Group will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.

Operating lease payments are recognised as an operating expense in the profit or loss on a straight-line basis over the lease term.

Land use rights are initially measured at cost. Following initial recognition, land use rights are measured at cost less accumulated amortisation and accumulated impairment losses. The land use rights are amortised over their lease terms.

Leasehold lands 50 to 100 years

(b) Group as lessor

Leases in which the Group do not transfer substantially all the risks and benefits of ownership of the asset are classified as operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income. Contingent rents are recognised as revenue in the period in which they are earned.

4.15 Inventories

Inventories are stated at the lower of cost and net realisable value. Costs incurred in bringing the inventories to their present location and condition are accounted for as follows:

- Raw materials, packing materials and consumables: purchase costs on a weighted average basis.

- Former: purchase costs on a first in, first out basis.

- Finished goods and work-in-progress: costs of direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity, excluding borrowing costs.

Net realisable value is the estimated selling price in the ordinary course of business less estimated costs of completion and the estimated costs necessary to make the sale.

4.16 Impairment of non-financial assets

At each reporting date, an assessment is made as to whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the asset’s recoverable amount is estimated. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.




4.16 Impairment of non-financial assets (Cont’d)

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators.

Impairment calculation is based on detailed budgets and forecast calculations, which are prepared separately for each CGU to which the individual assets are allocated. These budgets and forecast calculations generally cover a period of five years. For longer periods, a long-term growth rate is calculated and applied to project future cash flows after the fifth year.

Impairment losses of continuing operations, including impairment on inventories, are recognised in profit or loss in expense categories consistent with the function of the impaired asset.

Goodwill is tested for impairment annually at reporting date and when circumstances indicate that the carrying value may be impaired. Impairment is determined by assessing the recoverable amount of each CGU (or group of CGUs) to which the goodwill relates. When the recoverable amount of the CGU is less than its carrying amount, an impairment loss is recognised. Impairment losses relating to goodwill cannot be reversed in future periods.

For assets other than goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the recoverable amount of the asset or CGU is estimated. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in profit or loss.

4.17 Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

4.18 Financial assets

(a) Initial recognition and measurement

Financial assets are classified, at initial recognition, as financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, available-for-sale financial assets, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.

Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace (regular way trades) are recognised on the trade date, i.e., the date that the Group and the Company commit to purchase or sell the asset.

The Group’s and the Company’s financial assets include cash and bank balances, trade and other receivables, investments in debt securities and money market funds.




4.18 Financial assets (Cont’d)

(b) Subsequent measurement

For purposes of subsequent measurement, financial assets are classified in four categories:

(i) Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss includes financial assets held for trading and financial assets designated upon initial recognition at fair value through profit or loss. Financial assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. This category includes derivative financial instruments entered into by the Group and the Company that are not designated as hedging instruments in hedge relationships as defined by MFRS 139. Derivatives, including separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments. Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value with changes in fair value recognised in finance income or finance costs in the profit or loss.

Derivatives embedded in host contracts are accounted for as separate derivatives and recorded at fair value if their economic characteristics and risks are not closely related to those of the host contracts and the host contracts are not held for trading or designated at fair value through profit or loss. These embedded derivatives are measured at fair value with changes in fair value recognised in profit or loss. Re-assessment only occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that would otherwise be required or a reclassification of a financial asset out of the fair value through profit or loss.

The Group and the Company have designated derivatives that do not qualify for hedge accounting and money market funds as at fair value through profit or loss.

(ii) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate method (“EIR”), less impairment. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the profit or loss. The losses arising from impairment are recognised in profit or loss in finance costs for loans and in cost of sales or other operating expenses for receivables. The category generally applies to trade and other receivables.

Loans and receivables of the Group and Company comprise trade and other receivables (other than prepaid operating expenses and tax recoverable), amount due from related companies and cash and bank balances.

(iii) Held-to-maturity investments

Non-derivative financial assets with fixed or determinable payments and fixed maturities are classified as held to maturity when the Group and the Company have the positive intention and an ability to hold them to maturity. After initial measurement, held to maturity investments are measured at amortised cost using the EIR, less impairment. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance income in profit or loss. The losses arising from impairment are recognised in profit or loss as finance costs.

The Group and the Company did not have any held-to-maturity investments during the financial years ended 31 August 2018 and 2017.





(b) Subsequent measurement (Cont’d)

(iv) Available-for-sale (“AFS”) financial assets

AFS financial assets include equity investments and debt securities. Equity investments classified as AFS are those that are neither classified as held for trading nor designated at fair value through profit or loss. Debt securities in this category are those that are intended to be held for an indefinite period of time and that may be sold in response to needs for liquidity or in response to changes in the market conditions.

After initial measurement, AFS financial assets are subsequently measured at fair value with unrealised gains or losses recognised in OCI and credited in the fair value adjustment reserve until the investment is derecognised, at which time the cumulative gain or loss is recognised in other operating income, or the investment is determined to be impaired, when the cumulative loss is reclassified from the fair value adjustment reserve to profit or loss in finance costs. Interest earned whilst holding AFS financial assets is reported as interest income using the EIR method.

The Group and the Company evaluates whether the ability and intention to sell their AFS financial assets in the near term is still appropriate. When, in rare circumstances, the Group and the Company are unable to trade these financial assets due to inactive markets, the Group and the Company may elect to reclassify these financial assets if the management has the ability and intention to hold the assets for foreseeable future or until maturity.

For a financial asset reclassified from the AFS category, the fair value carrying amount at the date of reclassification becomes its new amortised cost and any previous gain or loss on the asset that has been recognised in equity is amortised to profit or loss over the remaining life of the investment using the EIR. Any difference between the new amortised cost and the maturity amount is also amortised over the remaining life of the asset using the EIR. If the asset is subsequently determined to be impaired, then the amount recorded in equity is reclassified to profit or loss.

All quoted debt securities of the Group are designated as AFS financial assets.

(c) Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e. removed from the statements of financial position) when:

- The rights to receive cash flows from the asset have expired;

- The Group and the Company have transferred their rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group and the Company have transferred substantially all the risks and rewards of the asset, or (b) the Group and the Company have neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Group and the Company have transferred their rights to receive cash flows from an asset or has entered into a pass-through arrangement, they evaluate if and to what extent they have retained the risks and rewards of ownership. When they have neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Group and the Company continue to recognise an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group and the Company have retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group and the Company could be required to repay.





(d) Impairment of financial assets

The Group and the Company assess at each reporting date whether there is any objective evidence that a financial asset or a group of financial assets is impaired. An impairment exists if one or more events that has occurred since the initial recognition of the asset (an incurred ‘loss event’), has an impact on the estimated future cash flows of the financial asset or the group of financial assets that can be reliably estimated. Evidence of impairment may include indications that the debtor or a group of debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganisation and where observable data indicate that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

Financial assets carried at amortised cost

For financial assets carried at amortised cost, the Group and the Company first assess whether objective evidence of impairment exists individually for financial assets that are individually significant, or collectively for financial assets that are not individually significant. If the Group and the Company determine that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. Assets that are individually assessed for impairment and for which an impairment loss is, or continues to be, recognised are not included in a collective assessment of impairment.

The amount of any impairment loss identified is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future expected credit losses that have not yet been incurred). The present value of the estimated future cash flows is discounted at the financial asset’s original effective interest rate.

The carrying amount of the asset is reduced through the use of an allowance account and the loss is recognised in profit or loss. Interest income (recorded as finance income in profit or loss) continues to be accrued on the reduced carrying amount and is accrued using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss. Loans together with the associated allowance are written off when there is no realistic prospect of future recovery and all collateral has been realised or has been transferred to the Group and the Company. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or reduced by adjusting the allowance account. If a write-off is later recovered, the recovery is credited to finance costs in profit or loss.

Available-for-sale (“AFS”) financial assets

For AFS financial assets, an assessment is made at each reporting date whether there is objective evidence that an assets or a group of assets is impaired.

In the case of investments classified as AFS, objective evidence would include a significant or prolonged decline in the fair value of the investment below its cost. ‘Significant’ is evaluated against the original cost of the investment and ‘prolonged’ against the period in which the fair value has been below its original cost. When there is evidence of impairment, the cumulative loss (measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that investment previously recognised in profit or loss) is removed from other comprehensive income and recognised in the statement of profit or loss. Impairment losses on equity investments are not reversed through profit or loss; increases in their fair value after impairment are recognised in other comprehensive income.

In the case of debt instruments classified as AFS, the impairment is assessed based on the same criteria as financial assets carried at amortised cost. However, the amount recorded for impairment is the cumulative loss measured as the difference between the amortised cost and the current fair value, less any impairment loss on that investment previously recognised in profit or loss.

Future interest income continues to be accrued based on the reduced carrying amount of the asset, using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss. The interest income is recorded as part of finance income. If, in a subsequent year, the fair value of a debt instrument increases and the increase can be objectively related to an event occurring after the impairment loss was recognised in profit or loss, the impairment loss is reversed through profit or loss.




4.19 Financial liabilities

(a) Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, financial guarantee contracts, payables, or as derivatives as appropriate.

All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.

The Group’s and the Company’s financial liabilities include trade and other payables, loans and borrowings, financial guarantee contracts and derivative liabilities.

(b) Subsequent measurement

The measurement of financial liabilities depends on their classification, as described below:

(i) Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss.

Financial liabilities are classified as held for trading if they are acquired for the purpose of selling in the near term. This category includes derivative financial instruments entered into by the Group and the Company that are not designated as hedging instruments in hedge relationships as defined by MFRS 139. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.

Gains or losses on liabilities held for trading are recognised in profit or loss.

The Group and the Company have designated derivatives that do not qualify for hedge accounting as at fair value through profit or loss.

(ii) Other financial liabilities

The Group’s and the Company’s other financial liabilities include trade payables, other payables and loans and borrowings.

Trade and other payables are recognised initially at fair value plus directly attributable transaction costs and subsequently measured at amortised cost using the effective interest method.

Loans and borrowings are recognised initially at fair value, net of transaction costs incurred, and subsequently measured at amortised cost using the effective interest rate method. Gains and losses are recognised in the profit or loss when the liabilities are derecognised as well as through the effective interest rate method (EIR) amortisation process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance costs in profit or loss.

(c) Financial guarantee contracts

Financial guarantee contracts issued by the Group and the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the best estimate of the expenditure required to settle the present obligation at the reporting date and the amount recognised less cumulative amortisation.




4.19 Financial liabilities (Cont’d)

(d) Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled, or expired. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in profit or loss.

(e) Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount is reported in the consolidated and separate statement of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

4.20 Derivative financial instruments and hedging activities

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value.

The method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and the nature of the item being hedged. Derivatives that do not qualify for hedge accounting are classified as held for trading and accounted for in accordance with the accounting policy set out in Note 4.18. The Group and the Company designate certain derivatives as hedges of a particular risk associated with a recognised asset or liability or a highly probable forecast transaction (cash flow hedge).

The Group and Company document at the inception of the transaction the relationship between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking various hedging transactions. The Group and Company also document their assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in cash flows of hedged items.

Cash flow hedge

The effective portion of the gain or loss on the hedging instrument is recognised in OCI in the cash flow hedge reserve, while any ineffective portion is recognised immediately in the statement of profit or loss.

Amounts recognised as OCI are transferred to profit or loss when the hedged transaction affects profit or loss, such as when the hedged financial income or financial expense is recognised or when a forecast sale occurs. When the hedged item is the cost of a non-financial asset or non-financial liability, the amounts recognised as OCI are transferred to the initial carrying amount of the non-financial asset or liability.

When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in profit or loss. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the profit or loss within ‘other gains/ (losses)’ and ‘foreign exchange gains/(losses)’.

4.21 Cash and bank balances

Cash and bank balances in the statements of financial position comprise cash at banks and on hand and short-term deposits.

For the purpose of the statements of cash flows, cash and cash equivalents consist of cash and short-term deposits with a maturity of three months or less excluding deposits pledged with banks that are not available for use.




4.22 Share capital and share issue expenses

An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Ordinary shares are equity instruments and are recorded at the proceeds received, net of directly attributable incremental transaction costs. Ordinary shares are classified as equity. Dividends on ordinary shares are recognised in equity in the period in which they are declared.

4.23 Cash dividend and non-cash distribution to equity holders of the Company

The Company recognises a liability to make cash or non-cash distributions to equity holders of the parent when the distribution is authorised and the distribution is no longer at the discretion of the Company. A distribution is authorised when it is approved by the shareholders and a corresponding amount is recognised directly in equity.

Non-cash distributions are measured at the fair value of the assets to be distributed with fair value re-measurement recognised directly in equity.

Upon distribution of non-cash assets, any difference between the carrying amount of the liability and the carrying amount of the assets distributed is recognised in profit or loss.

4.24 Provisions

Provisions are recognised when there is a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. When it is expected that some or all of a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the income statements net of any reimbursement.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

4.25 Government grants

Government grants are recognised at their fair value where there is reasonable assurance that the grant will be received and all conditions attached will be met. Government grants related to assets, measured at nominal value, shall be presented in the statement of financial position either by setting up the grant as deferred income or by deducting the grant in arriving at the carrying amount of the asset. Grants that compensate the Group for expenses incurred are recognised as income over the periods necessary to match the grant on a systematic basis to the costs that it is intended to compensate. Grants that compensate the Group for the cost of an asset are presented by deducting the grants in arriving at the carrying amount of the assets.

4.26 Contingencies

A contingent liability or asset is a possible obligation or asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of uncertain future event(s) not wholly within the control of the Group and the Company.

Contingent liabilities and assets are not recognised in the statement of financial position of the Group and of the Company.

4.27 Segment reporting

For management purposes, the Group is organised into operating segments based on their geographical location which are independently managed by the respective segment managers responsible for the performance of the respective segments under their charge. The segment managers report directly to the management of the Group who regularly review the segment results in order to allocate resources to the segments and to assess the segment performance. Additional disclosures on each of these segments are shown in Note 43, including the factors used to identify the reportable segments and the measurement basis of segment information.



5. New and amended standards

The accounting policies adopted are consistent with those of the previous financial year except for the adoption of the following new/revised MFRSs and Amendments to MFRSs:

Effective for annual periods Description beginning on or after

Amendments to MFRS 107: Disclosures Initiatives 1 January 2017 Amendments to MFRS 112: Recognition of Deferred Tax for Unrealised Losses 1 January 2017 Amendments to MFRS 12: Disclosure of Interests in Other Entities (Annual Improvement to MFRS 2014-2016 Cycle) 1 January 2017

The nature and the impact of each amendment is described below:

Amendments to MFRS 107: Disclosures Initiatives

The amendments to MFRS 107 Statement of Cash Flows requires an entity to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes. On initial application of these amendments, entities are not required to provide comparative information for preceding periods. Apart from the additional disclosures set out in the consolidated statement of cash flows, the application of these amendments has had no impact on the Group and on the Company.

Amendments to MFRS 112: Recognition of Deferred Tax for Unrealised Losses

The amendments clarify that an entity needs to consider whether tax law restricts the sources of taxable profits against which it may make deductions on the reversal of that deductible temporary difference. Furthermore, the amendments provide guidance on how an entity should determine future taxable profits and explain the circumstances in which taxable profit may include the recovery of some assets for more than their carrying amount.

The application of these amendments has had no impact on the Group and on the Company as the Group and the Company already assess the sufficiency of future taxable profits in a way that is consistent with these amendments.

Amendments to MFRS 12: Disclosure of Interests in Other Entities (Annual Improvement to MFRS 2014-2016 Cycle)

The amendments clarify that an entity need not provide summarised financial information for interests in subsidiaries, associates or joint ventures that are classified (or included in a disposal group that is classified) as held for sale. The application of these amendments has had no effect on the Group as none of the Group’s interest in these entities are classified, or included in a disposal group that is classified, as held for sale.



6. New and amended standards and interpretations issued but not yet effective

The standards and interpretations that are issued but not yet effective up to the date of issuance of the Group’s and the Company’s financial statements are discussed below. The Group and the Company intend to adopt these standards if applicable, when they become effective.

Effective for annual periods Description beginning on or after

MFRS 9 Financial Instruments 1 January 2018 MFRS 15 Revenue from Contracts with Customers 1 January 2018 Clarifications to MFRS 15 Revenue from Contracts with Customers 1 January 2018 Amendments to MFRS 2: Classification and Measurement of Share-based Payment Transactions 1 January 2018 Amendments to MFRS 4: Applying MFRS 9 Financial Instruments with MFRS 4 Insurance Contracts 1 January 2018 Amendments to MFRS 140: Transfers of Investment Property 1 January 2018 IC Interpretation 22: Foreign Currency Transactions and Advance Consideration 1 January 2018 Annual Improvements to MFRS Standards 2014 – 2016 Cycle 1 January 2018 MFRS 16 Leases 1 January 2019 Amendments to MFRS 9: Prepayment Features with Negative Compensation 1 January 2019 Amendments to MFRS 119: Plan Amendment, Curtailment or Settlement 1 January 2019 Amendments to MFRS 128: Long-term Interests in Associates and Joint Venture 1 January 2019 IC Interpretation 23: Uncertainty over Income Tax Treatments 1 January 2019 Annual Improvements to MFRS Standards 2015–2017 Cycle 1 January 2019 Amendments to References to the Conceptual Framework in MFRS Standards 1 January 2020 MFRS 17 Insurance Contracts 1 January 2021 Amendments to MFRS 10 and MFRS 128: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture Deferred

The directors expect that the adoption of the above standards and interpretations will have no material impact on the financial statements in the period of initial application as discussed below:

MFRS 9 Financial Instruments

MFRS 9 introduces new requirements for classification and measurement, impairment and hedge accounting. MFRS 9 is effective for annual periods beginning on or after 1 January 2018, with early application permitted. Retrospective application is required, but comparative information is not compulsory. During the financial year ended 31 August 2018, the Group and the Company performed a detailed impact assessment of all three aspects of MFRS 9. The assessment is based on present available information and may be subject to changes arising from further reasonable and supportable information being made available to the Group and the Company in the financial year ending 31 August 2019 when the Group and the Company adopt MFRS 9.

Based on the analysis of the Group’s and of the Company’s financial assets and liabilities as at 31 August 2018 on the basis of facts and circumstances that exist at that date, the directors of the Company have assessed the impact of MFRS 9 to the Group’s and the Company’s financial statements as follows:

(a) Classification and measurement

The Group and the Company do not expect a significant impact on its statements of financial position or equity on applying the classification and measurement requirements of MFRS 9. They expect to continue measuring at fair value all financial assets currently held at fair value.

Debt securities currently held as available-for-sale with gains and losses recorded in OCI will satisfy the conditions for classification as fair value through other comprehensive income (“FVOCI”). Fair value changes on debt securities at FVOCI are presented in OCI and are not subsequently transferred to profit or loss. Upon sale of debt securities at FVOCI, the cumulative gain or loss in OCI is reclassified to retained earnings. Money market funds currently measured at FVTPL which will continue to be measured on the same basis under MFRS 9. Debt instruments currently measured at amortised cost which meet the conditions for classification as amortised cost under MFRS 9.

There will be no impact on the Group’s and the Company’s accounting for financial liabilities, as the new requirements only affect the accounting for financial liabilities that are designated at FVTPL and modified financial liabilities, and the Group and the Company do not have any such financial liabilities.



6. New and amended standards and interpretations issued but not yet effective (Cont’d)

MFRS 9 Financial Instruments (Cont’d)

(b) Impairment

MFRS 9 requires the Group and the Company to record expected credit losses on all of its debt securities, loans and trade receivables, either on a 12-month or lifetime basis. The Group and the Company will apply the simplified approach and record lifetime expected losses on all trade receivables. Based on readily available information as at date of this report, the Group and the Company do not expect significant increase in allowance for doubtful debts.

(c) Hedging

The Group determined that all existing hedge relationships that are currently designated in effective hedging relationships will continue to qualify for hedge accounting under MFRS 9. The Group has chosen not to retrospectively apply MFRS 9 on transition to the hedges where the Group excluded the forward points from the hedge designation under MFRS 139. As MFRS 9 does not change the general principles of how an entity accounts for effective hedges, applying the hedging requirements of MFRS 9 will not have a significant impact on Group’s financial statements.

MFRS 15 Revenue from Contracts with Customers

MFRS 15 establishes a new five-step model that will apply to revenue arising from contracts with customers. MFRS 15 will supersede the current revenue recognition guidance including MFRS 118 Revenue, MFRS 111 Construction Contracts and the related interpretations when it becomes effective.

The core principle of MFRS 15 is that an entity should recognise revenue which depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

Under MFRS 15, an entity recognises revenue when (or as) a performance obligation is satisfied, such as when “control” of the goods or services underlying the particular performance obligation is transferred to the customer.

Either a full or modified retrospective application is required for annual periods beginning on or after 1 January 2018 with early adoption permitted.

The directors do not expect the application of MFRS 15 to have a significant impact on the financial statements of the Group and of the Company.

MFRS 16 Leases

MFRS 16 will replace MFRS 117 Leases, IC Interpretation 4 Determining whether an Arrangement contains a Lease, IC Interpretation 115 Operating Lease-Incentives and IC Interpretation 127 Evaluating the Substance of Transactions Involving the Legal Form of a Lease. MFRS 16 sets out the principles for the recognition, measurement, presentation and disclosure of leases and requires lessees to account for all leases under a single on-balance sheet model similar to the accounting for finance leases under MFRS 117.

At the commencement date of a lease, a lessee will recognise a liability to make lease payments and an asset representing the right to use the underlying asset during the lease term. Lessees will be required to recognise interest expense on the lease liability and the depreciation expense on the right-of-use asset.

Lessor accounting under MFRS 16 is substantially the same as the accounting under MFRS 117. Lessors will continue to classify all leases using the same classification principle as in MFRS 117 and distinguish between two types of leases: operating and finance leases.

MFRS 16 is effective for annual periods beginning on or after 1 January 2019. Early application is permitted but not before an entity applies MFRS 15. A lessee can choose to apply the standard using either a full retrospective or a modified retrospective approach. The Group and the Company plan to assess the potential effect of MFRS 16 on their financial statements in the next financial year.



7. Significant accounting judgements, estimates and assumptions

The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the end of the reporting period. However, uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in future periods.

7.1 Judgements made in applying accounting policies

In the process of applying the Group’s accounting policies, management has not made any critical judgements, apart from those involving estimations, which could have a significant effect on the amounts recognised in the financial statements except as discussed below:

Classification between investment property and property, plant and equipment

The Group has developed certain criteria based on MFRS 140 in making judgement whether a property qualifies as an investment property. Investment property is a property held to earn rentals or for capital appreciation or both.

Some properties comprise a portion that is held to earn rentals or for capital appreciation and another portion that is held for use in the production or supply of goods or services or for administrative purposes. If these portions could be sold separately (or leased out separately under a finance lease), the Group would account for the portions separately. If the portions could not be sold separately, the property is an investment property only if an insignificant portion is held for use in the production or supply of goods or services or for administrative purposes. Judgement is made on an individual property basis to determine whether ancillary services are so significant that a property does not qualify as investment property. The Group has determined that its property held to earn rental income or capital appreciation is investment property as only an insignificant portion of the property is used in the production or supply of goods or services or for administrative purposes and ancillary services are not significant to the property.

7.2 Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Group based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising beyond the control of the Group. Such changes are reflected in the assumptions when they occur.

(a) Inventories

In determining the costing of inventories, management’s judgement is required in determining the basis of finished goods and work-in-progress valuation which comprise costs of raw materials, direct labour, other direct costs, and the appropriate allocation of overheads based on normal operating capacity.

(b) Impairment of goodwill

Goodwill is tested for impairment annually and at other times when such indicators exist. This requires an estimation of the value in use of the cash-generating units to which goodwill is allocated.

When value in use calculations are undertaken, management must estimate future cash flows from the cash-generating unit and choose a suitable discount rate in order to calculate the present values of those cash flows. Further details of the carrying value, the key assumptions applied in the impairment assessment and sensitivity analysis to changes in the assumptions are disclosed in Note 23.



8. Revenue

Group Company 2018 2017 2018 2017 RM’000 RM’000 RM’000 RM’000

Sale of goods 4,214,482 3,409,176 - - Management fees from subsidiaries - - 4,912 4,310 Dividend income from subsidiaries - - 239,030 329,505

4,214,482 3,409,176 243,942 333,815

9. Interest income


Interest income from:

Available-for-sale financial assets 4,285 11,929 - - Loans and receivables 3,947 992 217 412 Financial assets at fair value through profit or loss 4,011 4,309 - 1,449 Others 13 2 - -

12,256 17,232 217 1,861

10. Other income


Realised gain on foreign exchange 2,435 26,031 - - Net gain on fair value changes of derivatives - 829 - - Rental income 9,557 6,021 - - Gain on disposal of debt securities 273 4,032 - - Gain on disposal of an associate - 1,205 - - Gain on disposal of property, plant and equipment - 3,087 - - Gain on disposal of land use rights 4,664 - - - Sales of scrap items 8,868 4,798 - - Insurance claims 4,996 - - - Sundry income 8,959 7,485 - 10

39,752 53,488 - 10



11. Profit before tax

The following items have been charged in arriving at profit before tax:


Auditors’ remuneration: Company’s auditors - Statutory audit - Current year 316 246 85 75 - Under/(over) provision in prior year 14 32 (7) - - Other services 1,065 60 941 60 Other auditors - Statutory audit - Current year 583 371 - - - (Over)/under provision in prior year (2) 19 - - Depreciation on property, plant and equipment (Note 16 and 48) 141,105 106,037 - - Amortisation of land use rights (Note 17) 1,298 734 - - Bad debt written off - 1,355 - - Direct operating expenses arising from investment property - Rental generating property 699 667 - - Net loss on foreign exchange - realised - - 6 34 - unrealised 19,630 21,490 - - Net loss on fair value changes of derivatives 2,262 - - - Employee benefits expense (Note 12) 483,635 384,861 4,085 4,192 Non-executive directors’ remuneration (Note 13) 839 745 837 742 Operating lease - Minimum lease payment for building and machinery 2,600 952 - - Net loss from fair value remeasurement on investment property (Note 18) 721 3,096 - - Loss on disposal of property, plant and equipment 904 - - - Property, plant and equipment written off (Note 16) 8,025 5,790 - -

12. Employee benefits expense


Wages and salaries 434,340 345,795 3,050 3,264 Social security costs 3,303 4,377 2 2 Pension costs - defined contribution plan 17,061 12,726 319 392 Share options granted under ESOS 1,932 578 167 41 Shares granted under ESGP 975 2,359 - 53 Other staff related expenses 25,523 18,608 98 59 Executive directors’ fees 501 418 449 381

483,635 384,861 4,085 4,192

Included in employee benefits expense of the Group and of the Company are executive directors’ remuneration amounting to RM11,102,000 (2017: RM8,514,000) and RM4,121,000 (2017: RM3,974,000) respectively as further disclosed in Note 13.



13. Directors’ remuneration


Directors of the Company

Executive: Salaries and other emoluments 4,791 4,727 3,208 3,123 Pension costs - defined contribution plan 406 474 302 375 Social security contributions 1 1 1 1 Share options granted under ESOS 204 166 161 41 Shares granted under ESGP 18 53 - 53 Fees 449 381 449 381 Benefits-in-kind 105 103 50 50

5,974 5,905 4,171 4,024

Non-executive: Fees 753 669 753 669 Other emoluments 84 73 84 73

837 742 837 742

Other directors

Executive: Salaries and other emoluments 4,680 2,450 - - Pension costs - defined contribution plan 392 143 - - Social security contributions 11 7 - - Share options granted under ESOS 98 11 - - Shares granted under ESGP - 64 - - Fees 52 37 - - Benefits-in-kind 106 22 - -

5,339 2,734 - -

Non-executive: Fees 2 3 - -

Analysis excluding benefits-in-kind: Total executive directors’ remuneration (Note 12) 11,102 8,514 4,121 3,974 Total non-executive directors’ remuneration (Note 11) 839 745 837 742

Total directors’ remuneration (excluding benefits-in-kind) 11,941 9,259 4,958 4,716 Benefits-in-kind 211 125 50 50

Total directors’ remuneration (including benefits-in-kind) 12,152 9,384 5,008 4,766



14. Income tax expense

Major components of income tax expense

The major components of income tax expense for the years ended 31 August 2018 and 2017 are as follows:


Current income tax: - Malaysian income tax 51,876 31,650 - - - Foreign tax 15,075 8,973 - - - Real property gain tax (“RPGT”) 177 258 - - - Under provision in respect of previous years 3,931 5,884 - -

71,059 46,765 - -

Deferred income tax (Note 21): - Relating to origination and reversal of temporary differences 15,199 1,261 - - - Under provision in respect of previous years 4,431 6,488 - -

19,630 7,749 - - Income tax expense recognised in profit or loss 90,689 54,514 - -

Reconciliation between tax expense and accounting profit

The reconciliation between tax expense and the product of accounting profit multiplied by the applicable corporate tax rate for the years ended 31 August 2018 and 2017 are as follows:


Profit before tax 528,595 385,043 233,759 327,273

Tax at Malaysian statutory tax rate of 24% (2017: 24%) 126,863 92,410 56,102 78,546 Adjustments: Different tax rates in other countries (1,569) (843) - - Effects of tax incentives claimed by foreign subsidiaries (6,926) (1,459) - - Income not subject to tax (35,684) (37,525) (57,418) (79,528) Non-deductible expenses 25,846 14,791 1,314 791 Effect of income subject to RPGT 177 258 - - Expenses entitled for double deduction (27) (15) - - Utilisation of tax incentives (22,982) (12,235) - - Deferred tax assets not recognised in respect of current year’s tax losses and unabsorbed capital allowance 327 3,310 2 191 Deferred tax assets recognised in respect of previously unutilised tax losses, unrecognised export allowance, reinvestment allowance and capital allowance (2,905) (14,520) - - Share of results of associate (407) 235 - - Under provision of deferred tax in respect of previous years 4,431 6,488 - - Under provision of income tax in respect of previous years 3,931 5,884 - -



14. Income tax expense (Cont’d)

Reconciliation between tax expense and accounting profit (Cont’d)

The reconciliation between tax expense and the product of accounting profit multiplied by the applicable corporate tax rate for the years ended 31 August 2018 and 2017 are as follows (Cont’d):


Utilisation of unabsorbed losses, reinvestment allowance and capital allowances (386) (2,265) - -

Income tax expense recognised in profit or loss 90,689 54,514 - -

Domestic income tax is calculated at the Malaysian statutory tax rate of 24% (2017: 24%) of the estimated assessable profit for the year.

Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions.

The above reconciliation is prepared by aggregating separate reconciliations for each national jurisdiction.

15. Earnings per share

(a) Basic

Basic earnings per share is calculated by dividing profit for the year, net of tax, attributable to owners of the parent by the weighted average number of ordinary shares outstanding during the financial year, excluding treasury shares held by the Company.

2018 2017

Profit for the year attributable to ordinary equity holders of the Company (RM’000) 434,215 330,664 Weighted average number of ordinary shares in issue (‘000) 1,280,032 1,253,286 Bonus issue subsequent to year end, excluding treasury held by the Company (‘000) (Note 47) 1,278,158 1,278,158

Adjusted weighted average number of ordinary shares in issue and issuable (‘000) 2,558,190 2,531,444

Basic EPS - before issuance of bonus shares (sen) 33.92 26.38 - after issuance of bonus shares (sen) 16.97 13.06 (b) Diluted

Diluted earnings per share is calculated by dividing profit for the year, net of tax, attributable to owners of the parent by the weighted average number of ordinary shares outstanding during the financial year plus the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares.



15. Earnings per share (Cont’d)

(b) Diluted (Cont’d)

2018 2017 Profit for the year attributable to ordinary equity holders of the Company (RM’000) 434,215 330,664 Weighted average number of ordinary shares in issue (‘000) 1,280,032 1,253,286

Effects of dilution: Assumed exercise of share options 6 1,353

1,280,038 1,254,639 Bonus issue subsequent to year end, excluding treasury held by the Company (‘000) (Note 47) 1,278,158 1,278,158

Adjusted weighted average number of ordinary shares in issue and issuable (‘000) 2,558,196 2,532,797

Diluted EPS - before issuance of bonus shares (sen) 33.92 26.36 - after issuance of bonus shares (sen) 16.97 13.06

The weighted average number of ordinary shares issued as at 31 August 2018 and 2017 have been adjusted to reflect the bonus issue of 1 for 1 existing ordinary shares which was completed on 29 October 2018. Further details are disclosed in Note 47.

16. Property, plant and equipment

* Land Plant Capital and and ** Other work-in buildings equipment assets progress Total Group RM’000 RM’000 RM’000 RM’000 RM’000

Cost

At 1 September 2016, as previously stated 551,383 1,063,597 122,047 171,550 1,908,577 Effects of changes in accounting policy (Note 48) 3,231 (35,438) - - (32,207)

At 1 September 2016, as restated 554,614 1,028,159 122,047 171,550 1,876,370 Additions # 143,535 111,859 21,008 202,850 479,252 Transfer to investment property (Note 18) (292) (701) - - (993) Reclassification 42,400 90,941 (954) (132,387) - Written off (229) (13,974) (783) (6) (14,992) Disposals (5,403) (8,684) (2,893) (2,392) (19,372) Exchange differences 8,633 21,391 1,774 3,821 35,619

At 31 August 2017/ 1 September 2017 743,258 1,228,991 140,199 243,436 2,355,884 Additions 26,342 166,447 28,647 237,663 459,099 Transfer to investment property (Note 18) - - - (2) (2) Acquisition of subsidiary companies 87,308 180,128 5,405 1,318 274,159 Reclassification 43,109 108,176 3,599 (154,884) - Written off (1,800) (19,483) (1,405) (12) (22,700) Disposals (6,946) (24,183) (2,675) (348) (34,152) Exchange differences (4,511) (8,978) (491) (206) (14,186)

At 31 August 2018 886,760 1,631,098 173,279 326,965 3,018,102



16. Property, plant and equipment (Cont’d)

* Land Plant Capital and and ** Other work-in buildings equipment assets progress Total Group RM’000 RM’000 RM’000 RM’000 RM’000

Accumulated depreciation

At 1 September 2016, as previously stated 65,741 619,483 66,586 - 751,810 Effects of changes in accounting policy (Note 48) - (4,377) - - (4,377)

At 1 September 2016, as restated 65,741 615,106 66,586 - 747,433 Depreciation charge for the year (Note 11 and 48) 8,786 84,759 16,103 - 109,648 Transfer to investment property (Note 18) (3) - - - (3) Reclassification 842 182 (1,024) - - Written off (178) (8,367) (657) - (9,202) Disposals (174) (3,754) (1,120) - (5,048) Exchange differences 1,646 15,650 885 - 18,181 Adjustment on depreciation charge (Note 48) - (3,611) - - (3,611)

At 31 August 2017/ 1 September 2017 76,660 699,965 80,773 - 857,398 Depreciation charge for the year (Note 11) 11,639 110,810 18,656 - 141,105 Reclassification (2) (10) 12 - - Written off (312) (13,162) (1,201) - (14,675) Disposals (323) (21,606) (1,709) - (23,638) Exchange differences (848) (5,750) (307) - (6,905)

At 31 August 2018 86,814 770,247 96,224 - 953,285

Net carrying amount

At 31 August 2017 666,598 529,026 59,426 243,436 1,498,486

At 31 August 2018 799,946 860,851 77,055 326,965 2,064,817

# As at 31 August 2017, there was a government grant received of RM2,489,000 deducted in arriving at

the carrying amount of plant and equipment.

** Other assets comprise motor vehicles, computer and software system, office equipment, signage, small value of assets, fire extinguisher, furniture and equipment.




*Land and buildings

Freehold land Buildings Total RM’000 RM’000 RM’000

Cost

At 1 September 2016, as previously stated 235,379 316,004 551,383 Effects of changes in accounting policy 3,231 - 3,231

At 1 September 2016, as restated 238,610 316,004 554,614 Additions 111,154 32,381 143,535 Transfer to investment property (Note 18) - (292) (292) Reclassification 8,645 33,755 42,400 Written off - (229) (229) Disposals (4,236) (1,167) (5,403) Exchange differences 1,938 6,695 8,633

At 31 August 2017/1 September 2017 356,111 387,147 743,258 Additions 1,668 24,674 26,342 Acquisition of subsidiary companies 1,477 85,831 87,308 Reclassification 67 43,042 43,109 Written off - (1,800) (1,800) Disposals - (6,946) (6,946) Exchange differences (848) (3,663) (4,511)

At 31 August 2018 358,475 528,285 886,760

Accumulated depreciation

At 1 September 2016, as restated - 65,741 65,741 Depreciation charge for the year - 8,786 8,786 Transfer to investment property (Note 18) (3) (3) Reclassification - 842 842 Written off - (178) (178) Disposals - (174) (174) Exchange differences - 1,646 1,646

At 31 August 2017/1 September 2017 - 76,660 76,660 Depreciation charge for the year - 11,639 11,639 Reclassification - (2) (2) Written off - (312) (312) Disposals - (323) (323) Exchange differences - (848) (848)

At 31 August 2018 - 86,814 86,814

Net carrying amount

At 31 August 2017 356,111 310,487 666,598

At 31 August 2018 358,475 441,471 799,946




(a) During the financial year, the Group acquired property, plant and equipment at aggregate cost of RM459,099,000 (2017: RM479,252,000) of which RM287,000 (2017: Nil) was acquired by means of finance lease.

(b) Property, plant and equipment of a subsidiary with the following net carrying amount is pledged to a bank for banking facility granted to the subsidiary as disclosed in Note 29.

2018 2017 RM’000 RM’000

Freehold land 1,080 9,106 Buildings 76,003 12,682 Plant and equipment 70,726 - Motor vehicles 122 -

147,931 21,788

(c) Property, plant and equipment of a subsidiary with the following net carrying amount is under finance lease arrangements as disclosed in Note 29.

2018 2017 RM’000 RM’000

Plant and equipment 755 - Motor vehicles 1,060 -

1,815 -



17. Land use rights

Group 2018 2017 RM’000 RM’000 Cost

At 1 September 2017/2016 45,092 43,332 Additions 341 1,536 Acquisition of subsidiary companies 67,116 - Disposals (4,923) - Exchange differences (347) 224

At 31 August 2018/2017 107,279 45,092

Accumulated amortisation At 1 September 2017/2016 4,635 3,871 Amortisation for the year (Note 11) 1,298 734 Disposals (281) - Exchange differences (48) 30

At 31 August 2018/2017 5,604 4,635

Net carrying amount 101,675 40,457

Amount to be amortised: - Not later than one year 1,781 754 - Later than one year but not later than five years 7,122 3,016 - Later than five years 92,772 36,687

101,675 40,457

The net carrying amounts of land use rights pledged as securities for loans and borrowings as disclosed in Note 29 amounted to RM62,844,000 (2017: Nil).

18. Investment property

Group 2018 2017 (Restated) RM’000 RM’000

Fair value of investment property (Note 40) 163,900 162,000

Freehold land and building 2018 RM’000

Fair value At 1 September 2017, as previously stated 83,156 Effects of change in accounting policy (Note 48) 78,844

At 1 September 2017, as restated 162,000 Additions from subsequent expenditure 2,619 Transfer from property, plant and equipment (Note 16) 2 Net loss from fair value remeasurement (Note 11) (721)

At 31 August 2018 163,900



18. Investment property (Cont’d)

Freehold land and building 2017 RM’000

Fair value At 1 September 2016, as previously stated 82,184 Effects of change in accounting policy (Note 48) 79,816

At 1 September 2016, as restated 162,000 Additions from subsequent expenditure 2,106 Transfer from property, plant and equipment (Note 16) 990 Net loss from fair value remeasurement (Note 11) (3,096)

At 31 August 2017 162,000

The fair value of the investment property was based on a valuation by an accredited independent qualified valuer. Valuation was based on current prices in an active market for certain properties and where appropriate, the investment method reflecting receipt of contractual rentals, expected future market rentals, current market yields, void periods, maintenance requirements and approximate capitalisation rates were used.

The following table shows the valuation technique used in the determination of fair value within Level 3, as well as the significant unobservable inputs used in the valuation model.

Valuation Significant unobservable Range technique inputs 2018 2017 Land and building Investment Estimated rental value per RM3.70 to RM5.00 to Method square feet per month RM5.20 RM6.00 Term yield rate 6.5% 6.5% Occupancy rate 85.0% 49.0% Long term vacancy rate 10.0% 15.0% Reversionary yield rate 7.0% 7.0%

Using the discounted cash flows method, fair value is estimated using assumptions regarding the benefits and liabilities of ownership over the asset’s life including an exit or terminal value. This method involves the projection of a series of cash flows on a real property interest. To this projected cash flow series, a market-derived discount rate is applied to establish the present value of the income stream associated with the asset. The exit yield is normally separately determined and differs from the discount rate.

The duration of the cash flows and the specific timing of inflows and outflows are determined by events such as rent reviews, lease renewal and related re-letting, redevelopment, or refurbishment. The appropriate duration is typically driven by market behaviour that is a characteristic of the class of real property. Periodic cash flow is typically estimated as gross income less vacancy, non-recoverable expenses, collection losses, lease incentives, maintenance cost, agent and commission costs and other operating and management expenses. The series of periodic net operating income, along with an estimate of the terminal value anticipated at the end of the projection period, is then discounted.

Significant increase(decrease) in estimated rental value in isolation would result in a significantly higher/(lower) fair value of the property. Significant increases/(decreases) in the long term vacancy rate and yield rates in isolation would result in a significantly lower/(higher) fair value.

Generally, a change in the assumption made for the estimated rental value is accompanied by a directionally similar change in the rent growth per annum and discount rate (and exit yield), and an opposite change in the long term vacancy rate.



19. Investment in subsidiaries

Company 2018 2017 RM’000 RM’000 Unquoted shares, at cost: - In Malaysia 1,020,077 831,620 Less: Accumulated impairment losses (4,845) (4,845)

1,015,232 826,775 - Outside Malaysia 3,728 3,728

1,018,960 830,503

Details of the subsidiaries are as follows:

Proportion of Country of ownership interest (%) Name incorporation 2018 2017 Principal activities

Held by the Company:

Top Glove Sdn. Malaysia 100 100 Manufacturing and trading Bhd. (“TGSB”)* of gloves

TG Medical Malaysia 100 100 Manufacturing and trading Sdn. Bhd. (“TGMSB”)# of gloves

Great Glove Malaysia 100 100 Provision of Sdn. Bhd.# management services Top Glove Engineering Malaysia 100 100 Property investment Sdn. Bhd.#

TG Medical United States 100 100 Trading of gloves (U.S.A.), Inc.# of America

Top Quality Malaysia 100 100 Manufacturing and trading Glove Sdn. Bhd.* of gloves

Top Care Sdn. Bhd.* Malaysia 100 100 Investment holding

GMP Medicare Malaysia 100 100 Manufacturing and trading Sdn. Bhd.* of gloves

Eastern Press Malaysia 100 - Printer and stationery Sdn. Bhd.#

Top Feel Malaysia 100 - Manufacture and sale of Sdn. Bhd.# condoms and rubber related products

Top Glove Labuan 100 - Investment holding Labuan Ltd.#

Top Glove Global Malaysia 100 - Provision of Sdn. Bhd.# management services



19. Investment in subsidiaries (Cont’d)


Held through TGSB:

Great Glove Thailand 74 74 Manufacturing and trading (Thailand) Co. Ltd.# of gloves

Top Glove Medical Thailand 100 100 Manufacturing and trading (Thailand) Co. Ltd.# of gloves

Top Glove Thailand 100 100 Producing and selling Technology concentrate latex (Thailand) Co. Ltd.#

B Tech Industry Thailand 100 100 Producing and selling Co. Ltd.# concentrate latex

Top Quality Thailand 100 100 Dormant Gloves (Thailand) Co. Ltd.#

Top Glove Europe Germany 97.5 97.5 Trading of gloves GmbH#

Great Glove The People’s 100 100 Manufacturing and trading (Xinghua) Co. Ltd.# Republic of of gloves China

TG Medical The People’s 100 100 Trading of gloves Suzhou Co. Ltd.# Republic of China

Top Glove Malaysia 100 100 Research and development International on gloves and rubber Sdn. Bhd.# goods

Top Glove Properties Malaysia 100 100 Property investment Sdn. Bhd.#

Medi-Flex Pte. Ltd. Singapore 100 100 Investment holding (“Medi-Flex”)#

BestStar Enterprise The British 100 100 Investment holding Ltd.* Virgin Islands

Flexitech Sdn. Bhd. Malaysia 100 100 Manufacturing and trading (“Flexitech”)* of gloves

TG Porcelain Sdn. Malaysia 100 100 Manufacturing of formers Bhd. (“TGPSB”)#

TGGD Medical Clinic Malaysia 75 75 Providing of clinical and Sdn. Bhd. (“TGGD”)# specialist medical services

TG FMT Sdn. Bhd.* Malaysia 70 70 Manufacturing and trading of chemicals

Top Glove Chemicals Malaysia 100 100 Manufacturing of chemicals Sdn. Bhd.# and chemical compounds





Held through TGMSB:

Top Healthy Fitness Malaysia 100 100 Fitness centre Sdn. Bhd.#

Held through Great Glove (Xinghua) Co. Ltd.:

TG Medical (Xinghua) The People’s 100 100 Trading of gloves Co. Ltd.# Republic of China

TG Medical (Putian) The People’s 100 100 Trading of gloves Co. Ltd.# Republic of China Held through Top Care Sdn. Bhd.:

Best Advance Malaysia 100 100 Investment holding Resources Limited (“Best Advance”)*

Green Resources Malaysia 100 100 Investment holding Limited (“Green Resources”)*

Aspion Sdn. Bhd. Malaysia 100 - Investment holding (“Aspion”)#

Held through Top Feel Sdn. Bhd.:

Duramedical Malaysia 85 - Manufacturing of rubber Sdn. Bhd.# dental dams and exercise bands

Held through Best Advance:

PT. Topglove Indonesia 100 100 Investment holding Indonesia (“PT Top Glove”)# ^

Held through PT Top Glove:

PT. Agro Pratama Indonesia 95 95 Plantation of rubber trees Sejahtera#

Held through Aspion:

Adventa Health Malaysia 100 - Distribution of medical Sdn. Bhd.# gloves and other hospital related products

Terang Nusa Malaysia 100 - Manufacturing and (Malaysia) Sdn. Bhd.# distribution of surgical and medical examination gloves

Cytotec (M) Malaysia 100 - Generation and supply of Sdn. Bhd.# energy and electricity using biomass technology

Purnabina Malaysia 97.2 - Manufacturing and distribution Sdn. Bhd.#** of medical gloves





Held through Aspion: (Cont’d)

Sentienx Malaysia 100 - Manufacturing and Sdn. Bhd.# distribution of medical and protection gloves

Terang Nusa Malaysia 100 - Dormant Sdn. Bhd.#

Ulma International Germany 100 - Distribution of medical GmbH# gloves and other hospital related products

Suizze Health Hong Kong 100 - Investment holding Limited#

Held through Adventa Health Sdn. Bhd.:

Beijing Adventa Health China 100 - Distribution of medical Supplies Co. Ltd.# products and medical devices

Held through Suizze Health Limited:

Kevenoll Do Brasil Brazil 100 - Distribution of medical Produtos Medicos products and medical Hospitalares LTDA# devices

* Audited by Ernst & Young, Malaysia # Audited by firms other than Ernst & Young ^ The total equity interests held by the Group is 100% and it is held by the following subsidiaries:

2018 2017 (i) Best Advance Resources Limited 99.9% 99.9% (ii) Green Resources Limited 0.1% 0.1%

** The total equity interests held by the Group is 97.2% and it is held by the following subsidiaries: 2018 2017 (i) Aspion Sdn Bhd 95.2% - (ii) Terang Nusa (Malaysia) Sdn. Bhd. 2.0% - Changes in group structure (a) Incorporation of Top Glove Global Sdn. Bhd. (“TG Global”)

On 5 September 2017, the Company incorporated TG Global, a wholly-owned subsidiary in Malaysia under the Companies Act 2016 with an issued and paid up capital of RM1.00 comprising 1 ordinary share.

(b) Incorporation of Top Glove Labuan Ltd. (“TG Labuan”)

On 31 October 2017, the Company incorporated TG Labuan, a wholly-owned subsidiary in Labuan under the Labuan Companies Act 1990 with an issued and paid up capital of USD1.00 comprising 1 ordinary share.

(c) Incorporation of Top Feel Sdn. Bhd. (“Top Feel”)

On 31 October 2017, the Company incorporated Top Feel, a wholly-owned subsidiary in Malaysia under the Companies Act 2016 with an issued and paid up capital of RM1.00 comprising 1 ordinary share.




(d) Acquisition of equity interest of NCI in Kevenoll Do Brasil Produtos Medicos Hospitalares LTDA (“Kevenoll”)

On 30 May 2018, the Group completed the acquisition of the remaining 30% equity interest in Kevenoll for a purchase consideration of USD1 million and Kevenoll became a wholly-owned subsidiary of the Group.

(e) Acquisition of Eastern Press Sdn. Bhd. (“EP”)

On 5 January 2018, the Company had acquired 5,000,000 ordinary shares representing 100% of the equity interest in EP for a cash consideration of RM46,250,000, resulting in the Company became the holding company of EP.

The acquired subsidiary has contributed the following results to the Group:

RM’000

Revenue 48,145 Profit for the year 1,262

The fair values of the identifiable assets and liabilities of EP as at the date of acquisition were:

Carrying Fair value amount RM’000 RM’000

Property, plant and equipment 32,912 33,993 Land use rights 17,100 9,887 Inventories 7,956 7,956 Trade and other receivables 20,201 20,201 Tax recoverable 81 81 Cash and bank balances 79 79

78,329 72,197

Trade and other payables 18,553 18,553 Loans and borrowings 29,153 29,153 Provision for retirement benefits 656 656 Deferred tax liabilities 5,314 3,842

53,676 52,204

Net identifiable assets 24,653 19,993

Group’s interest in the fair value of net identifiable assets 24,653 Total cost of acquisition 46,250

Goodwill on acquisition - provisional (Note 23) 21,597

The purchase price allocation for this acquisition is still incomplete as the Company is currently finalising its identification and measurement of all intangible assets and its allocated goodwill. The Company has up to 12 months to complete such allocation. Accordingly, on a provisional basis, the Company has recognised goodwill of RM21.6 million.

The effect of the acquisition on cash flows is as follows:

RM’000 Consideration settled in cash 46,250 Cash and cash equivalents of subsidiary acquired (79)

Net cash outflow on the acquisition 46,171




(f) Acquisition of Aspion Sdn. Bhd. (“Aspion”)

On 4 April 2018, Top Care Sdn. Bhd. (“TCSB”), a wholly-owned subsidiary of the Company had acquired 270,850,119 ordinary shares representing the entire equity interest in Aspion for a purchase consideration of RM1,370 million. Accordingly, Aspion has become a wholly-owned subsidiary of TCSB.

Part of the purchase consideration amounting to RM1,233 million is settled in cash while the balance of RM137 million is through issuance of 20,505,000 new ordinary shares in the Company at an issue price of about RM6.6813 each (“Consideration Shares”). The Consideration Shares is listed and quoted on the Main Market of Bursa Securities with effect from 9.00 a.m. on 5 April 2018.


2018 RM’000

Revenue 234,229 Profit for the year 9,603

The fair values of the identifiable assets and liabilities of Aspion as at the date of acquisition were:


Property, plant and equipment 238,740 238,740 Land use rights 49,358 49,358 Deferred tax assets 8,120 8,120 Inventories 77,739 77,739 Trade and other receivables 120,514 120,514 Derivative financial instruments 764 764 Cash and bank balances 11,789 11,789

507,024 507,024

Trade and other payables 93,873 93,873 Loans and borrowings 279,274 279,274 Income tax payable 7,279 7,279 Deferred tax liabilities 9,826 9,826

390,252 390,252


Net identifiable assets 116,772 Less: Non-controlling interests (4,941)

Group’s interest in the fair value of net identifiable assets 111,831 Total purchase consideration 1,370,000

Goodwill on acquisition - provisional (Note 23) 1,258,169




(f) Acquisition of Aspion Sdn. Bhd. (“Aspion”) (Cont’d)

RM’000 The purchase consideration was satisfied by: a) Cash consideration 1,233,000 b) Issuance of 20,505,000 Consideration Shares 137,000

1,370,000

The purchase price allocation for this acquisition is still incomplete as the Company is currently finalising its

identification and measurement of all intangible assets and its allocated goodwill. The Company has up to 12 months to complete such allocation. Accordingly, on a provisional basis, the Company has recognised goodwill of RM1,258 million.

Summarised financial information for non-controlling interests of the acquired subsidiary has not been disclosed as the carrying amount of the non-controlling interests in the consolidated statement of financial position is immaterial to the Group.


RM’000

Consideration settled in cash 1,233,000 Cash and cash equivalents of subsidiary acquired (11,789)

Net cash outflow on the acquisition 1,221,211

(g) Acquisition of Duramedical Sdn. Bhd. (“Duramedical”)

On 14 May 2018, Top Feel Sdn. Bhd. (“Top Feel”), a wholly-owned subsidiary of the Company had acquired 212,500 ordinary shares representing 85% of the equity interest in Duramedical for a cash consideration of RM3,778,000. Accordingly, Duramedical has become a subsidiary of Top Feel.


2018 RM’000

Revenue 727 Profit for the year 61

The fair values of the identifiable assets and liabilities of Duramedical as at the date of acquisition were:


Property, plant and equipment 2,507 2,217 Land use rights 658 312 Inventories 133 133 Trade and other receivables 89 89 Tax recoverable 32 32 Cash and bank balances 618 618

4,037 3,401




(g) Acquisition of Duramedical Sdn. Bhd. (“Duramedical”) (Cont’d)

The fair values of the identifiable assets and liabilities of Duramedical as at the date of acquisition were: (Cont’d)


Trade and other payables 63 63 Loans and borrowings 1,611 1,611 Deferred tax liabilities 183 30

1,857 1,704


Net identifiable assets 2,180 Less: Non-controlling interests (327)

Group’s interest in the fair value of net identifiable assets 1,853 Total purchase consideration 3,778

Goodwill on acquisition - provisional (Note 23) 1,925

The purchase price allocation for this acquisition is still incomplete as the Company is currently finalising its identification and measurement of all intangible assets and its allocated goodwill. The Company has up to 12 months to complete such allocation. Accordingly, on a provisional basis, the Company has recognised goodwill of RM1.925 million.

Summarised financial information for non-controlling interests of the acquired subsidiary has not been disclosed as the carrying amount of the non-controlling interests in the consolidated statement of financial position is immaterial to the Group.


RM’000

Consideration settled in cash 3,778 Cash and cash equivalents of subsidiary acquired (618)

Net cash outflow on the acquisition 3,160



20. Investment in an associate

Group 2018 2017 RM’000 RM’000

Unquoted shares at cost 12,204 12,204 Share of post-acquisition reserves (10,507) (12,204)

1,697 -

Details of the associate are as follows:

Proportion of Country of ownership interest (%) Name incorporation 2018 2017 Principal activities Held through TGSB:

Value Add Sdn. Bhd.# Malaysia 27 27 Investment holding

# Audited by firms other than Ernst & Young

The financial year end of the above associate is non-coterminous with the Group. For the purpose of applying the equity method of accounting, the latest available financial information has been used and appropriate adjustments have been made for the effects of significant transactions between the dates of the latest available financial information and financial years ended 31 August 2018 and 2017.

The summarised financial information of the associate, not adjusted for the proportion of ownership interest held by the Group, is as follows:

Group 2018 2017 RM’000 RM’000

Assets and liabilities Non-current assets 215,196 214,881 Current assets 1,442 2,463

Total assets 216,638 217,344

Non-current liabilities (190,154) (208,920) Current liabilities (20,200) (14,872)

Total liabilities (210,354) (223,792)

Net assets/(liabilities) 6,284 (6,448)

Results Revenue 15,029 22,194 Profit/(loss) for the year 12,732 (10,084)



20. Investment in an associate (Cont’d)

Reconciliation of the summarised financial information presented above to the carrying amount of the Group’s interest in associates:

Group 2018 2017 RM’000 RM’000

Net (liabilities)/assets of associates at 1 September 2017/2016 (6,448) 11,730 Profit/(loss) for the year 12,732 (10,084) Disposal of investment in an associate - (6,439) Dividend paid - (2,135) Other comprehensive income - 480

Net assets/(liabilities) of associates as at 31 August 2018/2017 6,284 (6,448)

Group’s share of net assets 1,697 -

21. Deferred tax (assets)/liabilities

Deferred income tax as at 31 August 2018 and 2017 relates to the following:

Deferredtaxliabilities Deferredtaxassets Unabsorbed export allowance, business losses, Property, capital and plant and reinvestment equipment Others allowances Total Group RM’000 RM’000 RM’000 RM’000

At 1 September 2016, as previously stated 52,272 17,300 (25,896) 43,676 Effects of changes in accounting policy (Note 48) - 2,128 - 2,128

At 1 September 2016, as restated 52,272 19,428 (25,896) 45,804

Recognised in profit or loss, as previously stated 15,019 2,361 (9,476) 7,904 Adjustment (Note 48) - (155) - (155)

As restated 15,019 2,206 (9,476) 7,749 Exchange difference - 23 - 23

At 31 August 2017/1 September 2017 67,291 21,657 (35,372) 53,576 Recognised in profit or loss 19,736 (3,497) 3,391 19,630 Acquisition of subsidiary companies - 7,203 - 7,203 Exchange difference - (27) - (27)

At 31 August 2018 87,027 25,336 (31,981) 80,382

The unutilised tax losses, unabsorbed capital allowances and other deductible temporary differences of the Group are available indefinitely for offsetting against future taxable profits of the respective entities within the Group, subject to no substantial change in shareholdings of those entities under the Income Tax Act, 1967 and guidelines issued by the tax authority.



21. Deferred tax (assets)/liabilities (Cont’d) The unutilised tax losses, unabsorbed capital allowances and other deductible temporary differences applicable

to foreign incorporated subsidiaries are pre-determined by and subject to the tax legislation of the respective countries.

Presented after appropriate offsetting as follows:

Group 2018 2017 RM’000 RM’000

Deferred tax assets (14,288) (14,681) Deferred tax liabilities 94,670 68,257

80,382 53,576

Deferred tax assets have not been recognised by the Group and the Company in respect of the following items:


Unutilised tax losses 5,787 17,094 1,895 1,895 Unabsorbed capital allowances 11,183 12,226 30 23 Unabsorbed reinvestment allowances 6,397 6,397 - -

23,367 35,717 1,925 1,918

Deferred tax assets have not been recognised by the Group and the Company in respect of these items as it is not probable that taxable profits of the Company and the subsidiaries would be available against which deductible temporary differences could be utilised.

22. Investment securities


Current

Available-for-salefinancialassets - Debt securities (quoted outside Malaysia) 106,019 125,453 - -

Financialassetsatfairvaluethrough profitorloss - Money market funds (quoted in Malaysia) 87,695 81,457 2 2,583

Total current investment securities 193,714 206,910 2 2,583

Non-current

Unquoted investments - golf club membership 392 392 - -

194,106 207,302 2 2,583

Debt securities of the Group amounting to RM10,632,000 (2017: Nil) were pledged to a bank for credit facility granted to the Group as disclosed in Note 29.



23. Goodwill

Goodwill has been allocated to Cash Generating Units (“CGUs”) identified as follows:

Group 2018 2017 RM’000 RM’000

Top Glove Medical (Thailand) Co. Ltd. 2,946 2,946 B Tech Industry Co. Ltd. 14,789 14,789 GMP Medicare Sdn. Bhd. 5,070 5,070 Eastern Press Sdn. Bhd. (Note 19(e)) 21,597 - Aspion Sdn. Bhd. (Note 19(f)) 1,258,169 - Duramedical Sdn. Bhd. (Note 19(g)) 1,925 -

1,304,496 22,805

Movement in goodwill: As at 1 September 2017/2016 22,805 22,805 Acquisition of subsdiaries 1,281,691 -

As at 31 August 2018/2017 1,304,496 22,805

Key assumptions used in value-in-use calculations

The recoverable amount of a CGU is determined based on value-in-use calculations using cash flow projections based on financial budgets approved by management covering a five years period.

The following describes each key assumption on which management has based its cash flow projections to undertake impairment testing of goodwill:

(i) Growth rate for the 5 years projection is determined based on the management’s estimate on the industry trends and past performances of the segments, thereafter terminal growth rate is assumed to be nil.

(ii) A pre-tax discount rate of 7.41% (2017: 9%) was applied in determining the recoverable amount of the unit. The discount rate was estimated based on a weighted average cost of capital of the Company.

The Group is of the opinion that any reasonably possible change in the above key assumptions would not materially cause the recoverable amount of the CGU’s to be lower than its carrying amount, other than the provisional goodwill of Aspion as disclosed below.

Sensitivity to changes in key assumptions

The sensitivity test indicated that changes in the discount rate used in the value-in-use calculation of Aspion Sdn. Bhd. will result in the recoverable amount to equal to the corresponding carrying amounts of the provisional goodwill and related assets, assuming no change in other variables, is as follows:

Increase in discount rate 0.6%



24. Inventories

Group 2018 2017 RM’000 RM’000

Cost Raw materials 140,239 80,727 Consumables and hardware 39,041 28,257 Work-in-progress 71,742 66,325 Finished goods 247,795 121,131

498,817 296,440

Net realisable value Raw materials 927 - Work-in-progress 5,570 2,509 Finished goods 2,872 16,826

508,186 315,775

During the year, the amount of inventories recognised as an expense of the Group amounted to RM3,368 million (2017: RM2,804 million).

25. Trade and other receivables


Trade receivables Third parties 629,172 394,408 - - Less: Allowance for impairment (3,422) (975) - -

Trade receivables, net 625,750 393,433 - -

Other receivables Amounts due from subsidiaries - - 1,992 166 Sundry receivables 11,467 14,036 8 8 Refundable deposits 8,962 11,880 - -

20,429 25,916 2,000 174

Total trade and other receivables 646,179 419,349 2,000 174

Total trade and other receivables 646,179 419,349 2,000 174 Add: Cash and bank balances (Note 28) 164,836 240,068 151 484

Total loans and receivables 811,015 659,417 2,151 658



25. Trade and other receivables (Cont’d)

(a) Trade receivables

Trade receivables are non-interest bearing and are generally on 30 to 90 days (2017: 30 to 90 days) terms. Other credit terms are assessed and approved on a case-by-case basis. They are recognised at their original invoice amounts which represent their fair values on initial recognition.

Ageing analysis of trade receivables

The ageing analysis of the Group’s trade receivables is as follows:

Group 2018 2017 RM’000 RM’000

Neither past due nor impaired 523,360 356,685 1 to 30 days past due not impaired 72,324 34,131 31 to 60 days past due not impaired 10,637 2,071 61 to 90 days past due not impaired 5,417 38 91 to 120 days past due not impaired 7,820 61 More than 121 days past due not impaired 6,192 447 102,390 36,748 Impaired 3,422 975

629,172 394,408

Receivables that are neither past due nor impaired

Trade and other receivables that are neither past due nor impaired are creditworthy debtors with good payment records with the Group and are mostly regular customers that have been transacting with the Group.

None of the Group’s trade receivables that are neither past due nor impaired have been renegotiated during the financial year.

Receivables that are past due but not impaired

The Group has trade receivables amounting to RM102,390,000 (2017: RM36,748,000) that are past due at the reporting date but not impaired. These receivables are unsecured in nature.

Receivables that are impaired

The Group’s trade receivables that are impaired at the reporting date and the movement of the allowance accounts used to record the impairment are as follows:

Group 2018 2017 RM’000 RM’000 Trade receivables-nominal amounts 3,422 975 Less: Allowance for impairment loss (3,422) (975)

- -



25. Trade and other receivables (Cont’d)

(a) Trade receivables (Cont’d) Movements in the allowance accounts:

Group 2018 2017 RM’000 RM’000

1 September 2017/2016 975 975 Written off (975) - Acquisition of subsidiary company 3,422 -

31 August 2018/2017 3,422 975

Trade receivables that are individually determined to be impaired at the reporting date relate to a debtor that is in significant financial difficulty and has defaulted on payment. This receivable is not secured by any collateral or credit enhancements.

(b) Related party balances

Amounts due from subsidiaries are unsecured, non-interest bearing and are repayable upon demand.

26. Other current assets


Prepaid operating expenses 28,698 13,502 1,024 - Goods and service tax refundable 52,613 35,688 47 - Advances to suppliers for raw materials 1,852 489 - - Advances to suppliers for property, plant and equipment 23,217 1,579 - -

106,380 51,258 1,071 -

27. Derivative financial instruments

Group 2018 2017 RM’000 RM’000 Contract/ Contract/ Notional Fair value Notional Fair value Amount Liabilities Amount Assets Forward currency contracts 366,378 (856) 211,595 645

At 31 August 2018, the Group held forward currency contracts designated as hedges of expected future sales to customers and repayment of loan for which the Group has firm commitments. Forward currency contracts used to hedge the Company’s sales are denominated in USD86,339,000 and EUR2,750,000 for which firm commitments existed at the reporting date, extending to January 2019 (2017: November 2017).

During the financial year, the Group recognised a loss of RM2,262,000 (2017: gain of RM829,000) in the profit or loss arising from changes in the fair value of the forward currency contracts.



28. Cash and bank balances


Cash on hand and at banks 159,979 230,005 151 484 Deposits with licensed banks and other financial institutions 4,857 10,063 - -

Cash and bank balances 164,836 240,068 151 484 Less: Deposits pledged with banks with maturity of more than 3 months (2,462) (1,549) - -

Cash and cash equivalents 162,374 238,519 151 484

Cash at banks and deposits with licensed banks and other financial institutions of the Group amounting to RM2,462,000 (2017: RM1,549,000) are pledged to banks for credit facility granted to the Group as disclosed in Note 29.

The weighted average effective interest rates and maturity days of deposits with licensed banks and other financial institutions at the reporting date were as follows:

Group 2018 2017 Weighted average effective interest rates (%) 2.26 1.59 Maturity days 7 days - 365 days 1 day - 357 days

29. Loans and borrowings

Group 2018 2017 Maturity RM’000 RM’000

Current Secured: RM Bank overdrafts On demand 1,511 - RM Bankers’ acceptances 2018 42,714 - Hire purchase payables (Note 39(c)) 2019 725 - USD Revolving credit 2018 98,146 - USD Revolving loan 2019 21,441 20,988 RM Term loan 2019 2,637 - USD Term loan 2019 90,746 267 RM Trade loan financing 2018 33,465 - USD Trade loan financing 2018 14,446 -

305,831 21,255

Unsecured: Thai Baht Promissory notes 2018 51,357 67,409 USD Revolving credit 2018 471,754 183,180 RM Revolving credit 2018 54,000 42,800 RM Term loan 2019 3,125 - Less: Unamortised transaction costs (3,492) -

576,744 293,389

Total current loans and borrowings 882,575 314,644



29. Loans and borrowings (Cont’d)

Group 2018 2017 Maturity RM’000 RM’000 Non-current Secured: Hire purchase payables (Note 39(c)) 2020 - 2024 1,038 - USD Revolving loan 2020 - 2021 35,674 60,666 RM Term loan 2020 - 2035 13,735 - USD Term loan - 1,084

50,447 61,750

Unsecured: USD Syndicated term loan 2023 1,273,325 - Less: Unamortised transaction costs (5,288) -

1,268,037 - RM Term loan 2022 11,875 -

1,279,912 -

Total non-current loans and borrowings 1,330,359 61,750

Total loans and borrowings 2,212,934 376,394

The range of interest rates at the reporting date for borrowings is as follows:

Group 2018 2017 % %

Bank overdrafts 7.5% Nil Bankers’ acceptances 3.9% to 8.1% Nil Hire purchase payables 2.5% to 5.3% Nil Promissory notes 1.9% to 7.1% 2.0% to 2.3% Trade loan financing 3.2% to 4.6% Nil Revolving credit 1.8% to 5.6% 1.8% to 3.8% Revolving loan 1.9% to 2.8% 1.93% Syndicated term loan 2.7% to 3.3% Nil Term loan 3.4% to 5.5% 0.9% to 3.3%

The remaining maturities of the loans and borrowings as at 31 August 2018 and 2017 are as follows:

Group 2018 2017 RM’000 RM’000

On demand or within one year 882,575 314,644 More than 1 year and less than 2 years 789,952 21,596 More than 2 years and less than 5 years 534,487 40,154 More than 5 years 5,920 -

2,212,934 376,394

The RM bank overdrafts, RM bankers’ acceptances, hire purchase payables, USD revolving credit, USD revolving loan, RM term loan, USD term loan, RM trade loan financing, USD trade loan financing of the Group and of the Company are secured by certain assets of the Group and of the Company as follows:

(i) fixed charge over certain property, plant and equipment and land use rights as disclosed in Note 16 and 17 respectively;

(ii) corporate guarantee from the Company as disclosed in Note 45;

(iii) USD loan at 2.2% to 2.7% p.a. was secured by charges over debt securities of the Group as disclosed in Note 22; and

(iv) deposits with licensed banks and other financial institutions as disclosed in Note 28.



30. Trade and other payables


Trade payables 275,801 233,494 - -

Other payables Accrued operating expenses 82,067 56,546 1,499 2,488 Sundry payables 141,817 128,762 9 77

223,884 185,308 1,508 2,565

Total trade and other payables 499,685 418,802 1,508 2,565 Add: Loans and borrowings (Note 29) 2,212,934 376,394 - -

Total financial liabilities carried at amortised cost 2,712,619 795,196 1,508 2,565

(a) Trade payables

These amounts are non-interest bearing. The normal trade credit term granted to the Group ranges from 30 to 90 days (2017: range from 30 to 90 days).

(b) Other payables

These amounts are non-interest bearing. Other payables are normally settled on an average term of 30 to 90 days (2017: range from 30 to 90 days).

31. Other current liabilities

These amounts represent advances received from customers for goods purchased.

32. Share capital

Group and Company 2018 2017 Number of Monetary Number of Monetary shares value shares value ‘000 RM’000 ‘000 RM’000

Issued and fully paid At 1 September 2017/2016 1,256,299 636,644 1,254,812 627,406 Exercise of ESOS 3,425 11,972 1,487 3,128 Issued for acquisition of a subsidiary (Note 19(f)) 20,505 137,000 - - Transfer from share option reserve - 2,093 - - Transition to no-par value regime* - - - 6,110

At 31 August 2018/2017 1,280,229 787,709 1,256,299 636,644

* The new Companies Act 2016 (“the Act”), which came into operation on 31 January 2017, abolished the concepts of authorised share capital and par value of share capital. Consequently, the amounts standing to the credit of the share premium account of RM6,110,000 become part of the Company’s share capital pursuant to the transitional provisions set out in Section 618(2) of the Act. Notwithstanding this provision, the Company may within 24 months from the commencement of the Act, use the amount standing to the credit of its share premium account of RM6,110,000 for purposes as set out in Section 618(3). There is no impact on the number of ordinary shares in issue or the relative entitlement of any of the members as a result of this transition.



32. Share capital (Cont’d)

On 10 October 2018, the Company obtained shareholders’ approval at its Extraordinary General Meeting for a bonus issue of 1,280,229,124 new ordinary shares on the basis of 1 bonus share for every 1 existing ordinary share. The bonus issue was completed on 29 October 2018.

The holders of ordinary shares (except treasury shares) are entitled to receive dividends as and when declared by the Company. All ordinary shares carry one vote per share without restrictions and rank equally with regard to the Company’s residual assets.

The new ordinary shares issued during the year ranked pari passu in all respects with the existing ordinary shares of the Company.

33. Share premium

This is a non-distributable reserve which arose from the issue of the Company’s shares at a premium:

Group and Company 2018 2017 RM’000 RM’000

At 1 September 2017/2016 - 4,781 Issuance of ordinary shares pursuant to ESOS - 1,051 Transfer from share option reserve - 278 Transition to no-par value regime - (6,110)

At 31 August 2018/2017 - -

34. Treasury shares

This amount relates to the acquisition cost of treasury shares net of the proceeds received on their subsequent sale or issuance.

The shareholders of the Company, by an ordinary resolution passed in an annual general meeting held on 5 January 2017, renewed their approval for the Company’s plan to repurchase its own shares. The directors of the Company are committed in enhancing the value of the Company to its shareholders and believe that the Share Buy Back can be applied in the best interests of the Company and its shareholders.

During the financial year, the Company transferred 93,700 treasury shares to eligible employees under employee share grant scheme at average market price of RM10.40 per share. The total transferred treasury shares net of transaction costs were RM975,000. The difference between the transferred treasury shares and the cost of the treasury shares amounted to RM561,000 was recognised in equity.

Of the total 1,280,229,000 issued and fully paid ordinary shares as at 31 August 2018, 2,071,000 are held as treasury shares by the Company. As at 31 August 2018, the number of outstanding ordinary shares in issue and fully paid is therefore 1,278,158,000 ordinary shares.



35. Other reserves

Foreign Share Fair value Cash flow exchange Legal option adjustment hedge reserve reserve reserve reserve reserve Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group

At 1 September 2016 25,676 4,278 2,861 (4,307) - 28,508 Gain on fair value changes - - - 9,641 - 9,641 Transfer to profit or loss upon disposal of debt securities - - - (4,032) - (4,032) Foreign currency translation 28,024 - - - - 28,024 Share options granted under ESOS - - 578 - - 578 Transfer from/(to) retained earnings - 651 (593) - - 58 Transfer to share premium - - (278) - - (278)

At 31 August 2017/ 53,700 4,929 2,568 1,302 - 62,499 1 September 2017 Loss on fair value changes - - - (2,192) (41,504) (43,696) Transfer to profit or loss upon disposal of debt securities - - - (273) - (273) Foreign currency translation (17,575) - - - - (17,575) Share options granted under ESOS - - 1,932 - - 1,932 Transfer from/(to) retained earnings - 4,235 (478) - - 3,757 Transfer to share capital - - (2,093) - - (2,093)

At 31 August 2018 36,125 9,164 1,929 (1,163) (41,504) 4,551

Share option reserve RM’000

Company

At 31 August 2016/1 September 2016 2,861 Share options granted under ESOS 578 Transfer to share premium (278) Transfer to retained earnings (593)

At 31 August 2017/1 September 2017 2,568 Share options granted under ESOS 1,932 Transfer to share capital (2,093) Transfer to retained earnings (478)

At 31 August 2018 1,929

(a) Foreign exchange reserve

The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign operations whose functional currencies are different from that of the Group’s presentation currency. It is also used to record the exchange differences arising from monetary items which form part of the Group’s net investment in foreign operations, where the monetary item is denominated in either the functional currency of the reporting entity or the foreign operation.

(b) Legal reserve

This represents a general reserve provided for in respect of subsidiaries incorporated in the People’s Republic of China and Thailand.



35. Other reserves (Cont’d)

(b) Legal reserve (Cont’d)

Under the Wholly Foreign Owned Enterprise (“WFOE”) Law in the People’s Republic of China, at least 10% of the net profit after taxation in each financial year must be credited to this reserve, until it reaches 50% of the registered paid up capital of the subsidiary.

Under the Civil and Commercial Code in Thailand, a company is required to set aside a statutory reserve equal to at least 5% of its net profit each time when the company pays out a dividend, until it reaches 10% of the registered share capital of the company.

(c) Share option reserve

The share option reserve represents the equity-settled share options granted to employees. This reserve is made up of the cumulative value of services received from employees recorded on grant of share options.

(d) Fair value adjustment reserve

Fair value adjustment reserve represents the cumulative fair value changes, net of tax, of available-for-sale financial assets until they are disposed of or impaired.

(e) Cash flow hedge reserve

The cash flow hedge reserve represents the effective portion of the cash flow hedge relationships incurred at the reporting date

36. Retained earnings

The Company may distribute dividends out of its entire retained earnings as at 31 August 2018 and 2017 under the single tier system.

37. Share based payments

(i) Employee share options scheme (“ESOS”)

The Company’s ESOS is governed by the By-Laws which was approved by the shareholders at the Extraordinary General Meeting held on 9 January 2018 and became effective on 2 August 2018.

The main features of the ESOS are as follows:

(a) The ESOS shall be in force for a period of ten years from the date of the receipt of the last of the requisite approvals.

(b) Eligible persons are employees of the Group (including executive directors) who have been confirmed in the employment of the Group and have served for at least one year before the date of the offer. The eligibility for participation in the ESOS shall be at the discretion of the Options Committee appointed by the Board of Directors.

(c) The total number of shares to be issued under the ESOS shall not exceed in aggregate 10% of the issued and paid up share capital of the Company at any point of time during the tenure of the ESOS.

(d) The option price for each share shall be the 5-days weighted average market price of the underlying shares at the time the ESOS Options are granted, with either a premium or a discount of not more than ten percent (10%).

(e) No option shall be granted for less than 100 shares to any eligible employee.

(f) An option granted under the ESOS shall be capable of being exercised by the grantee by notice in writing to the Company commencing from the vest date but before the expiry on 31 May 2028.

(g) All new ordinary shares issued upon exercise of the options granted under the ESOS will rank pari passu in all respect with the existing ordinary shares of the Company other than as may be specified in a resolution approving the distribution of dividends prior to their exercise dates.

(h) No eligible person shall participate at any time in more than one share option scheme implemented by any company within the Group unless otherwise approved by the Options Committee.

(i) The options shall not carry any right to vote at a general meeting of the Company.



37. Share based payments (Cont’d)

(i) Employee share options scheme (“ESOS”) (Cont’d)

The terms of share options outstanding as at end of the financial year are as follows:

Number of share options over the ordinary shares Grant Expiry Exercise As at As at date date price 1.9.2017 Granted Exercised Lapsed 31.8.2018 RM ‘000 ‘000 ‘000 ‘000 ‘000

2018

5.9.2008 1.8.2018 1.01 2.40 - - (2.4) - 5.3.2009 1.8.2018 1.13 2.40 - - (2.4) - 5.9.2009 1.8.2018 1.76 55.6 - (49.6) (6.0) - 5.2.2010 1.8.2018 2.82 12.0 - (12.0) - - 5.3.2010 1.8.2018 2.90 1,528.0 - (1,506.8) (21.2) - 5.4.2010 1.8.2018 3.49 23.2 - (23.2) - - 6.5.2010 1.8.2018 3.08 129.2 - (129.2) - - 5.6.2010 1.8.2018 3.06 39.0 - (39.0) - - 5.7.2010 1.8.2018 3.43 31.6 - (31.6) - - 6.8.2010 1.8.2018 3.26 12.8 - (12.8) - - 5.10.2011 1.8.2018 2.08 31.0 - (21.4) (9.6) - 3.4.2013 1.8.2018 2.76 282.2 - (262.6) (19.6) - 2.8.2014 1.8.2018 2.32 407.5 - (394.1) (13.4) - 1.6.2017 1.8.2018 5.33 938.4 - (938.4) - - 2.8.2018 31.5.2028 10.12 - 3,166.6 (4.7) - 3,161.9

3,495.3 3,166.6 (3,425.4) (74.6) 3,161.9

Number of share options over the ordinary shares Grant Expiry Exercise As at As at date date price 1.9.2016 Granted Exercised Lapsed 31.8.2017 RM ‘000 ‘000 ‘000 ‘000 ‘000

2017

5.9.2008 1.8.2018 1.01 2.4 - - - 2.4 5.3.2009 1.8.2018 1.13 7.2 - (4.8) - 2.4 5.9.2009 1.8.2018 1.76 91.8 - (36.2) - 55.6 5.11.2009 1.8.2018 2.06 28.0 - (28.0) - (0.0) 5.2.2010 1.8.2018 2.82 12.0 - - - 12.0 5.3.2010 1.8.2018 2.90 2,147.7 - (619.7) - 1,528.0 5.4.2010 1.8.2018 3.49 27.2 - (4.0) - 23.2 6.5.2010 1.8.2018 3.08 131.2 - (2.0) - 129.2 5.6.2010 1.8.2018 3.06 97.2 - (58.2) - 39.0 5.7.2010 1.8.2018 3.43 32.0 - (0.4) - 31.6 6.8.2010 1.8.2018 3.26 20.0 - (7.2) - 12.8 5.10.2011 1.8.2018 2.08 100.4 - (69.4) - 31.0 3.4.2013 1.8.2018 2.76 521.8 - (235.8) (3.8) 282.2 2.8.2014 1.8.2018 2.32 746.6 - (334.9) (4.2) 407.5 1.6.2017 1.8.2018 5.33 - 1,024.7 (86.3) - 938.4

3,965.5 1,024.7 (1,486.9) (8.0) 3,495.3





Details of share options exercised during the financial year and the fair value, at exercise date, of ordinary shares issued are as follows:

Fair value Number of Exercise of ordinary share Considerations Exercise Date price shares options received RM RM ’000 RM’000

2018

September 2017 - August 2018 1.76 5.50 - 11.56 49.6 87.3 September 2017 - August 2018 2.82 5.50 - 11.56 12.0 33.8 September 2017 - August 2018 2.90 5.50 - 11.56 1,506.8 4,369.6 September 2017 - August 2018 3.49 5.50 - 11.56 23.2 81.0 September 2017 - August 2018 3.08 5.50 - 11.56 129.2 397.9 September 2017 - August 2018 3.06 5.50 - 11.56 39.0 119.3 September 2017 - August 2018 3.43 5.50 - 11.56 31.6 108.4 September 2017 - August 2018 3.26 5.50 - 11.56 12.8 41.7 September 2017 - August 2018 2.08 5.50 - 11.56 21.4 44.5 September 2017 - August 2018 2.76 5.50 - 11.56 262.6 724.8 September 2017 - August 2018 2.32 5.50 - 11.56 394.1 914.3 September 2017 - August 2018 5.33 5.50 - 11.56 938.4 5,001.7 September 2017 - August 2018 10.12 5.50 - 11.56 4.7 47.6

3,425.4 11,971.9

2017

Before no-par value regime

September 2016 - August 2017 1.76 4.26 - 8.50 5.0 8.8 September 2016 - August 2017 2.90 4.26 - 8.50 181.7 526.9 September 2016 - August 2017 3.06 4.26 - 8.50 4.0 12.2 September 2016 - August 2017 3.43 4.26 - 8.50 0.4 1.4 September 2016 - August 2017 2.08 4.26 - 8.50 18.2 37.9 September 2016 - August 2017 2.76 4.26 - 8.50 121.3 334.8 September 2016 - August 2017 2.32 4.26 - 8.50 161.8 375.4

492.4 1,297.4 Less: Par value of ordinary shares (246.2)

Share premium 1,051.2

After no-par value regime

September 2016 - August 2017 1.13 4.26 - 8.50 4.8 5.4 September 2016 - August 2017 1.76 4.26 - 8.50 31.2 54.9 September 2016 - August 2017 2.06 4.26 - 8.50 28.0 57.7 September 2016 - August 2017 2.90 4.26 - 8.50 438.0 1,270.2 September 2016 - August 2017 3.49 4.26 - 8.50 4.0 14.0 September 2016 - August 2017 3.08 4.26 - 8.50 2.0 6.2 September 2016 - August 2017 3.06 4.26 - 8.50 54.2 165.9 September 2016 - August 2017 3.26 4.26 - 8.50 7.2 23.5 September 2016 - August 2017 2.08 4.26 - 8.50 51.2 106.5 September 2016 - August 2017 2.76 4.26 - 8.50 114.5 316.0 September 2016 - August 2017 2.32 4.26 - 8.50 173.1 401.6 September 2016 - August 2017 5.33 4.26 - 8.50 86.3 460.0

994.5 2,881.9






Fair value of share options

The fair value of share options granted during the year were estimated by using a binomial option pricing model, taking into account the terms and conditions upon which the options were granted. The fair value of share options granted on 2 August 2018 was estimated on the grant date using the following assumptions:

Fair value of share options (RM) 0.61 Weighted average share price (RM) 10.18 Weighted average exercise price (RM) 10.12 Expected volatility (%) 34.43 Expected life (years) 9.84 Risk free interest rate (%) 4.07 Expected dividend yield (%) 1.47

The expected life of the share options is based on historical data and is not necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may also not necessarily be the actual outcome.

(ii) Employee share grant plan (“ESGP”)

The Company’s ESGP is governed by the By-Laws which was approved by the shareholders at the Extraordinary General Meeting held on 6 January 2016 and became effective on 12 January 2016 and is administered by the ESGP Committee.

Under the ESGP, Eligible Employees may be granted ESGP Awards comprising shares of the Company. The ESGP Awards, once accepted, will vest without any consideration payable, subject to vesting date(s) and/or vesting conditions as may be determined at the discretion of the ESGP Committee. The ESGP Committee may, at its discretion, decide that any vesting of the Company’s shares comprised in an ESGP Awards shall be satisfied through:

(a) the issuance of new shares of the Company (b) the transfer of existing shares of the Company (c) settlement in cash; or (d) a combination of any of the above

The main features of the ESGP are as follows:

(a) The aggregate number of shares of the Company which may be awarded under the ESGP and any other schemes involving issuance of new shares of the Company to employees which are still subsisting shall not exceed 10% of the issued and paid-up share capital of the Company (“Plan Size”).

(b) Eligible persons are any employee or executive director of the Group (excluding dormant subsidiaries) who fulfills the eligibility criteria. The eligibility for participation in the ESGP shall be at the discretion of the ESGP Committee appointed by the Board of Directors.

(c) The number of shares comprised in each ESGP Award shall be determined at the discretion of the ESGP Committee after taking into consideration, inter alia, the performance and seniority, years of service and potential for future development of the Eligible Employee and the employee’s contribution to the Group as well as such other criteria as the ESGP Committee may deem relevant.

(d) The aggregate number of shares that may be allocated to any one participant shall not exceed 10% of the total number of shares to be awarded under the ESGP and any other schemes involving issuance of new shares of the Company which may be implemented from time to time by the Company.

(e) The aggregate maximum allocation to the directors and senior management of the Group (excluding dormant subsidiaries) shall not be more than 75% of the Company’s shares awarded under the ESGP.




(ii) Employee share grant plan (“ESGP”) (Cont’d)

The main features of the ESGP are as follows (Cont’d):

(f) The ESGP shall be in force for a period of ten years from the effective date of implementation which is the date the last of the requisite approvals and/or conditions have been obtained and/or complied with.

(g) The shares to be allotted and issued under the ESGP will, upon allotment and issue, rank pari passu in all respects with the existing shares of the Company, save and except that they will not be entitles to any dividends, rights, allotments and/or other distributions in respect of which the entitlement date is prior to the date of allotment and issuance of the new shares.

38. Related party transactions

(a) Sales and purchase of goods

In addition to the related party information disclosed elsewhere in the financial statements, the following significant transactions between the Group and related parties took place at terms mutually agreed between the parties during the financial year:


Gross dividends from subsidiaries - - 239,030 329,505 Management fees from subsidiaries - - 4,912 4,310 Purchase of raw materials from related to certain directors of Company 71 22,033 - -

(b) Compensation of key management personnel

The remuneration of executive directors and other key management personnel during the financial year were as follows:


Salaries and other emoluments 10,276 8,853 3,208 3,123 Pension costs - defined contribution plan 896 817 302 375 Social security contributions 14 12 1 1 Share options granted under ESOS 317 191 161 41 Shares granted under ESGP 37 168 - 53 Fees 501 418 449 381 Benefits-in-kind 230 151 50 50

12,271 10,610 4,171 4,024

39. Commitments

(a) Capital commitments

Group 2018 2017 RM’000 RM’000

Property, plant and equipment: Approved and contracted for 186,901 113,586


39. Commitments (Cont’d)

(b) Operating lease arrangements

(i) Group as lessee

In addition to the land use rights disclosed in Note 17, the Group had entered into commercial leases on certain office equipment. These leases have an average tenure of between one and five years.

Future minimum rentals payable under non-cancellable operating leases (excluding land use rights) at the reporting date are as follows:

Group 2018 2017 RM’000 RM’000

Future minimum rentals payments: Not later than 1 year 1,439 1,474 Later than 1 year and not later than 2 years 460 1,125 Later than 2 years and not later than 5 years 314 378

2,213 2,977

(ii) Group as lessor

Future minimum rentals receivable under non-cancellable operating leases at the reporting date are as follows:

Group 2018 2017 RM’000 RM’000

Future minimum rentals payments: Not later than 1 year 6,079 6,040 Later than 1 year and not later than 2 years 4,548 4,846 Later than 2 years and not later than 5 years 5,519 8,107

16,146 18,993

(c) Hire purchase payables

Group 2018 2017 RM’000 RM’000

Minimum lease payments: Not later than 1 year 774 - Later than 1 year but not later than 2 years 688 - Later than 2 years but not later than 5 years 373 - Later than 5 years 15 -

Total minimum lease payments 1,850 - Less: Amounts representing finance charges (87) -

Present value of minimum lease payments 1,763 -

Present value of payments: Not later than 1 year 725 - Later than 1 year but not later than 2 years 663 - Later than 2 years but not later than 5 years 360 - Later than 5 years 15 -

Present value of minimum lease payments 1,763 - Less: Amount due within 12 months (Note 29) (725) -

Amount due after 12 months (Note 29) 1,038 -



40. Fair values

(i) Determination of fair value of financial instruments

Financial instruments that are not carried at fair value and whose carrying amounts are reasonable approximation of fair value

The following are classes of financial instruments that are not carried at fair value and whose carrying amounts are reasonable approximation of fair value:

Note

Trade and other receivables 25 Loans and borrowings (current) 29 Loans and borrowings (non-current) 29 Trade and other payables 30

The carrying amounts of these financial assets and liabilities are reasonable approximation of fair values, either due to their short-term nature or that they are floating rate instruments that are re-priced to market interest rates on or near the reporting date.

The fair values of loans and borrowings are estimated by discounting expected future cash flows at market incremental lending rate for similar types of lending, borrowing or leasing arrangements at the reporting date.

Investment securities (current)

Fair value is determined directly by reference to their published market bid price at the reporting date.

Derivatives

Forward currency contracts are valued using a valuation technique with market observable inputs. The most frequently applied valuation techniques include forward pricing, using present value calculations. The models incorporate various inputs including the credit quality of counterparties, foreign exchange spot and forward rates.

Investment property

The fair value of the investment property was based on a valuation by an accredited independent qualified value as disclosed in Note 18.

(ii) Fair value hierarchy

The following table provides the fair value measurement hierarchy of the Group’s assets and liabilities as at reporting date:

Quoted prices in Significant Significant active observable unobservable market inputs inputs (Level 1) (Level 2) (Level 3) Total RM’000 RM’000 RM’000 RM’000

Group As at 31 August 2018

Current

Assets/(liabilities) measured at fair value Available-for-sale financial assets 106,019 - - 106,019 Financial assets at fair value through profit or loss 87,695 - - 87,695 Derivative financial instruments - (856) - (856)

Non-current

Assets measured at fair value Investment property (Note 18) - - 163,900 163,900



40. Fair values (Cont’d)

(ii) Fair value hierarchy (Cont’d)

Quoted prices in Significant Significant active observable unobservable market inputs inputs (Level 1) (Level 2) (Level 3) Total RM’000 RM’000 RM’000 RM’000

Group As at 31 August 2017

Current

Assets measured at fair value Available-for-sale financial assets 125,453 - - 125,453 Financial assets at fair value through profit or loss 81,457 - - 81,457 Derivative financial instruments - 645 - 645

Non-current

Assets measured at fair value Investment property (Note 18) - - 162,000 162,000

Company As at 31 August 2018

Current

Assets measured at fair value Financial assets at fair value through profit or loss 2 - - 2

As at 31 August 2017

Current

Assets measured at fair value Financial assets at fair value through profit or loss 2,583 - - 2,583

During the reporting period ended 31 August 2018 and 2017, there were no transfers between Level 1, Level 2 and Level 3 fair value measurements.

41. Financial risk management objectives and policies

Financial liabilities comprise loans and borrowings, trade and other payables, derivative liabilities and financial guarantee contracts. The main purpose of these financial liabilities is to finance the Group’s and the Company’s operations and to provide guarantees to support their operations. Financial assets include trade and other receivables, debt securities, derivative assets, money market funds investments and cash and short-term deposits.

The Group is exposed to market risk, credit risk and liquidity risk. The Group’s senior management oversees the management of these risks and ensures that the Group’s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Group’s policies and risk objectives. All derivative activities for risk management purposes are carried out by senior management who have the appropriate skills, experience and supervision. It is the Group’s policy that no trading in derivatives for speculative purposes may be undertaken. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below:



41. Financial risk management objectives and policies (Cont’d) (a) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprise interest rate risk, foreign exchange currency risk and other price risk such as equity price risk. Financial instruments affected by market risk include loans and borrowings, cash and short term deposits, debt securities, money market funds investments and derivative financial instruments.

(b) Credit risk

Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligations. The Group’s and the Company’s exposure to credit risk arises primarily from trade and other receivables. For other financial assets (including debt securities, money market funds investments, cash and bank balances and derivatives), the Group and the Company minimise credit risk by dealing exclusively with high credit rating counterparties.

The Group’s objective is to seek continual revenue growth while minimising losses incurred due to increased credit risk exposure. The Group trades only with recognised and creditworthy third parties. It is the Group’s policy that all customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an ongoing basis with the result that the Group’s exposure to bad debts is not significant.

Exposure to credit risk

At the reporting date, the Group’s and the Company’s maximum exposure to credit risk is represented by the carrying amount of each class of financial assets recognised in the statements of financial position, including derivatives liabilities.

Credit risk concentration profile

The Group has no significant concentration of credit risk that may arise from exposure to a single debtor or to groups of debtors.

Financial assets that are neither past due nor impaired

Information regarding trade and other receivables that are neither past due nor impaired is disclosed in Note 25(a). Deposits with banks and other financial institutions, debt securities and derivatives that are neither past due nor impaired are placed with or entered into with reputable financial institutions or companies with high credit ratings and no history of default.

Financial assets that are either past due or impaired

Information regarding financial assets that are either past due or impaired is disclosed in Note 25(a).

(c) Liquidity risk

Liquidity risk is the risk that the Group or the Company will encounter difficulty in meeting financial obligations due to shortage of funds. The Group’s and the Company’s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Group’s and the Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of stand-by credit facilities.

The table below summarises the maturity profile of the Group’s and the Company’s liabilities at the reporting date based on contractual undiscounted repayment obligations.



41. Financial risk management objectives and policies (Cont’d)

(c) Liquidity risk (Cont’d)

2018 On demand or within One to Over one year five years five years Total RM’000 RM’000 RM’000 RM’000

Group

Financial liabilities Trade and other payables, excluding bank guarantees 499,685 - - 499,685 Derivatives 856 - - 856 Loans and borrowings 933,364 1,380,443 6,856 2,320,663

Total undiscounted financial liabilities 1,433,905 1,380,443 6,856 2,821,204

Company

Financial liabilities Corporate guarantees* 1,874,167 - - 1,874,167 Trade and other payables, excluding bank guarantees 1,508 - - 1,508

Total undiscounted financial liabilities 1,875,675 - - 1,875,675

2017 On demand or within One to Over one year five years five years Total RM’000 RM’000 RM’000 RM’000

Group

Financial liabilities Trade and other payables, excluding bank guarantees 418,802 - - 418,802 Loans and borrowings 322,362 63,528 - 385,890

Total undiscounted financial liabilities 741,164 63,528 - 804,692

Company

Financial liabilities Corporate guarantees* 350,542 - - 350,542 Trade and other payables, excluding bank guarantees 2,565 - - 2,565

Total undiscounted financial liabilities 353,107 - - 353,107

* Based on the maximum amount that can be called for under the corporate guarantees. No default has occurred at the end of the financial year.




(d) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of the Group’s and the Company’s financial instruments will fluctuate because of changes in market interest rates.

The Group’s exposure to interest rate risk arises primarily from its loans and borrowings. The Group manages its interest rate exposure by maintaining a mix of fixed and floating rate borrowings. The Group actively reviews its debt portfolio, taking into account the investment holding period and nature of its assets. This strategy allows it to capitalise on cheaper funding in a low interest rate environment and achieve a certain level of protection against rate hikes.

Sensitivity analysis for interest rate risk

At the reporting date, if interest rates had been 10 basis points lower/higher, with all other variables held constant, the Group’s profit before tax would have been RM2,196,000 (2017: RM375,000) higher/lower, arising mainly as a result of lower/higher interest expense on floating rate loans and borrowings. The assumed movement in basis points for interest rate sensitivity analysis is based on the currently observable market environment.

(e) Market price risk

The Group’s quoted investment securities are susceptible to market price risk arising from uncertainties about future values of the investment securities. The Group manages the market price risk through diversification and by placing limits on individual and total investment in investment securities. Reports on the investment portfolio are submitted to the Group’s senior management on a regular basis. The Board of Directors reviews and approves all investment decisions.

The Group has an Investment Committee with the objectives of reviewing, advising and ensuring that the Group’s investment in debt securities is consistent with the delegated authority limit approved by the Board; and cash invested is within the risk appetite of the Group. The Investment Committee established certain criteria for current and future investment in debt securities. Any investment differing from the criteria established will require the Investment Committee’s approval. The Investment Committee also aims to establish an effective investment management framework for the Group.

At the reporting date, the exposure to quoted investment securities at fair value was disclosed in Note 22.

Sensitivity analysis for market price risk

The following table demonstrates the sensitivity of the Group’s debt investments to reasonably possible price movements in investments classified as available-for-sale at the reporting date:

2018 2017 RM’000 RM’000

Group

Debt investments - strengthened 5% (2017: 5%) 5,301 6,273 - weakened 5% (2017: 5%) (5,301) (6,273)

(f) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

The Group has transactional currency exposures mainly arising from revenue that are denominated in a currency other than the respective functional currencies of the Group entities. These functional currencies are Malayisan Ringgit (“RM”), Thailand Baht (“Baht”), Chinese Renminbi (“RMB”) and Australian Dollar (“AUD”). The foreign currencies in which these transactions are denominated are mainly United States Dollars (“USD”), Euro and AUD. In addition, the Group has significant borrowings in USD (Note 29). Therefore, the Group is exposed to foreign currency risk. These exposures are managed, to the extent possible, by natural hedge that arise when payments for foreign currency payables are matched against receivables denominated in the same foreign currency.




(f) Foreign currency risk (Cont’d)

The net unhedged financial assets and financial liabilities of the Group companies that are not denominated in their functional currencies are as follows:

Net financial (liabilities)/assets held in non-functional currency USD Euro Total RM’000 RM’000 RM’000

Functional currency of Group companies

At 31 August 2018: Ringgit Malaysia (462,206) (2,451) (464,657) Thailand Baht 35,893 (261) 35,632 Chinese Renminbi 20,795 - 20,795 Australian Dollars 23,827 815 24,642

(381,691) (1,897) (383,588)

At 31 August 2017: Ringgit Malaysia (175,598) (193) (175,791) Thailand Baht 20,895 - 20,895 Chinese Renminbi 13,800 - 13,800 Australian Dollars 35,667 870 36,537

(105,236) 677 (104,559)

Sensitivity analysis for foreign currency risk

The following table demonstrates the sensitivity of the Group’s profit net of tax to a reasonably possible change in the USD and EURO exchange rates against the respective functional currencies of the Group entities, with all other variables held constant.

2018 2017 RM’000 RM’000

USD/RM - strengthened 5% (2017: 5%) (23,110) (8,780) - weakened 5% (2017: 5%) 23,110 8,780 USD/Baht - strengthened 5% (2017: 5%) 1,795 1,045 - weakened 5% (2017: 5%) (1,795) (1,045) USD/RMB - strengthened 5% (2017: 5%) 1,040 690 - weakened 5% (2017: 5%) (1,040) (690) USD/AUD - strengthened 5% (2017: 5%) 1,191 1,783 - weakened 5% (2017: 5%) (1,191) (1,783) EURO/RM - strengthened 5% (2017: 5%) (123) (10) - weakened 5% (2017: 5%) 123 10 EURO/AUD - strengthened 5% (2017: 5%) 41 44 - weakened 5% (2017: 5%) (41) (44)



42. Capital management

The primary objective of the Group’s and of the Company’s capital management is to ensure that it maintains a strong credit rating and healthy capital ratios in order to support its business and maximise shareholder value.

The Group and the Company manage their capital structure and make adjustments, in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Group and the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. No changes were made in the objectives, policies or processes during the years ended 31 August 2018 and 2017.

As disclosed in Note 35(b), subsidiaries of the Group incorporated in the People’s Republic of China and Thailand are required to set aside a statutory reserve fund under local regulations. This externally imposed capital requirement has been complied with by the above-mentioned subsidiaries for the financial years ended 31 August 2018 and 2017.

The Group and the Company monitor capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Group and the Company include within net debt, loans and borrowings, trade and other payables, less cash and cash equivalents. Capital includes equity attributable to the owners of the parent less the fair value adjustment reserve and the above-mentioned restricted statutory reserve fund.

Group Company Note 2018 2017 2018 2017 (Restated) RM’000 RM’000 RM’000 RM’000

Loans and borrowings 29 2,212,934 376,394 - - Trade and other payables 30 499,685 418,802 1,508 2,565 Other current liabilities 31 59,248 62,292 1 1 Less: cash and cash equivalents 28 (162,374) (238,519) (151) (484)

Net debt 2,609,493 618,969 1,358 2,082

Equity attributable to the owners of the parent 2,378,481 2,055,231 1,020,687 831,194 Add/(less): - Fair value adjustment reserve 35 1,163 (1,302) - - - Legal reserve 35 (9,164) (4,929) - -

Total capital 2,370,480 2,049,000 1,020,687 831,194

Capital and net debt 4,979,973 2,667,969 1,022,045 833,276

Gearing ratio 52.40% 23.20% 0.13% 0.25%

43. Segment information

For management purposes, the Group is organised into business units based on their geographical areas, and has five reportable operating segments.

Management monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profit or loss which, in certain respects as explained in the table below, is measured differently from operating profit or loss in the consolidated financial statements. Group financing (including finance costs), income taxes and share of results of associate are managed on a group basis and are not allocated to operating segments.

The directors are of the opinion that all inter-segment transactions have been entered into the normal course of business and have been established on negotiated and mutually agreed terms.



43. Segment information (Cont’d)

The The People’s British Republic Virgin Malaysia Thailand of China Islands Others Eliminations Note Consolidated 31 August 2018 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Revenue External sales 3,514,891 390,050 176,748 - 132,793 - 4,214,482 Inter-segment sales 66,983 354,082 2,094 - - (423,159) A -

Total revenue 3,581,874 744,132 178,842 - 132,793 (423,159) 4,214,482

Results Interest income 10,618 107 129 4,315 - (2,913) 12,256 Depreciation and amortisation 117,655 17,973 5,751 - 1,024 - 142,403 Segment profit/(loss) 514,212 66,403 27,881 5,927 (52,204) (33,624) B 528,595

Assets Additions to non-current assets 439,382 16,264 5,944 - 469 - C 462,059 Segment assets 3,339,728 333,264 89,802 113,913 73,372 1,320,481 D 5,270,560

Liabilities Segment liabilities 1,366,564 102,211 20,417 11,878 1,272,372 103,350 E 2,876,792

Other segment information Capital commitments 181,716 4,687 498 - - - 186,901

31 August 2017

Revenue External sales 2,844,069 290,662 118,471 - 155,974 - 3,409,176 Inter-segment sales 69,891 398,026 1,655 - - (469,572) A -

Total revenue 2,913,960 688,688 120,126 - 155,974 (469,572) 3,409,176

Results Interest income 11,576 84 45 12,031 - (6,504) 17,232 Depreciation and amortisation 83,985 16,698 5,021 - 1,067 - 106,771 Segment profit/(loss) 319,250 40,921 13,487 13,451 5,228 (7,294) B 385,043




The The People’s British Republic Virgin Malaysia Thailand of China Islands Others Eliminations Note Consolidated 31 August 2017 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Assets Additions to non-current assets 430,922 45,874 6,085 - 13 - C 482,894 Segment assets 2,349,621 307,700 77,506 151,098 66,766 37,486 D 2,990,177

Liabilities Segment liabilities 717,253 108,365 22,630 - 9,240 68,257 E 925,745

Other segment information Capital commitments 109,067 4,132 387 - - - 113,586

A Inter-segment revenues are eliminated on consolidation.

B The following items are (deducted from)/added to segment profit to arrive at profit before tax presented in the consolidated income statement.

2018 2017 RM’000 RM’000

Share of results of associates 1,697 (980) Finance costs (35,321) (6,314)

(33,624) (7,294)

C Additions to non-current assets consist of:

2018 2017 RM’000 RM’000

Property, plant and equipment 459,099 479,252 Land used rights 341 1,536 Investment property 2,619 2,106

462,059 482,894

D The following items are added to segment assets to arrive at total assets reported in the consolidated statement of financial position:

2018 2017 RM’000 RM’000

Deferred tax assets (Note 21) 14,288 14,681 Investments in associates (Note 20) 1,697 - Goodwill (Note 23) 1,304,496 22,805

1,320,481 37,486




E The following items are added to segment liabilities to arrive at total liabilities reported in the consolidated statement of financial position:

2018 2017 RM’000 RM’000

Deferred tax liabilities (Note 21) 94,670 68,257

44. Dividends


Recognised during the financial year:

Dividends on ordinary shares:

- Final tax exempt single tier dividend of 8.5 sen per share on 1,255,159,000 ordinary shares, and paid on 25 January 2018 106,691 - 106,691 - - First tax exempt interim single tier dividend of 7 sen per share on 1,277,926,000 ordinary shares, and paid on 17 July 2018 89,454 - 89,454 - - Final tax exempt single tier dividend of 8.5 sen per share on 1,252,987,000 ordinary shares, and paid on 23 January 2017 - 106,508 - 106,508 - First tax exempt interim single tier dividend of 6 sen per share on 1,253,938,000 ordinary shares, and paid on 17 July 2017 - 75,221 - 75,246

196,145 181,729 196,145 181,754

At the forthcoming Annual General Meeting, a single tier final dividend of 5 sen per share on 2,556,316,000 ordinary shares amounting to RM127,817,000 in respect of the financial year ended 31 August 2018 will be proposed for shareholders’ approval. The financial statements for the current financial year do not reflect this proposed dividend. Such dividend, if approved by the shareholders, will be accounted for in equity as an appropriation of retained earnings in the financial year ending 31 August 2019.

Dividends received by the ESGP Trusts amounting to RM186 (2017: RM25,000) for the Group is eliminated against the dividend expense of the Company upon consolidation of the ESGP Trusts as disclosed in Note 4.9(d).

45. Financial guarantees

A nominal amount of RM1,874,167,000 (2017: RM350,542,000) relating to corporate guarantees has been provided by the Company to banks for its subsidiaries’ loans and borrowings.

As at reporting date, no values are ascribed on these guarantees and letter of undertaking provided by the Company to secure banking facilities described above as the directors regard the value of the credit enhancement provided by these guarantees as minimal and the probability of default, based on historical track records of the parties receiving the guarantees are remote.



46. Material litigation

The Company and its wholly-owned subsidiary, Top Care Sdn Bhd (“Top Care”) have taken the following legal proceedings:

(i) Writ action in the Kuala Lumpur High Court, against Low Chin Guan, Wong Chin Toh ACPL Sdn Bhd

(“ACPL”) and Kwek Siew Leng (“Kwek”) (collectively, the “Defendants”) (“Writ Action”).

(ii) Arbitration proceedings at the Singapore International Arbitration Centre, against Adventa Capital Pte. Ltd. (“Adventa Capital”) (“Singapore Arbitration”)

The Writ Action and the Singapore Arbitration pertain to the Sale and Purchase Agreement entered into by

the Company and Top Care on 12 January 2018 for Top Care’s purchase of all issued shares in Aspion Sdn Bhd from Adventa Capital for RM1.37 billion (“the SPA”).

The claim is RM640,470,000 as damages suffered by reason of the fraudulent misrepresentations made by Adventa Capital, Wong and Low to induce the Company and Top Care to enter into the SPA at RM1.37 billion as well as conspiracy by Adventa Capital, Wong, Low and Kwek to defraud the Company and Top Care. ACPL is named by reason of it having received RM72.3 million out of the RM1.37 billion purchase price. The Company and Top Care have elected to affirm the SPA and claim for damages.

In the Singapore Arbitration, Adventa Capital is counterclaiming against the Company and Top Care for inter alia the following:

(i) Losses suffered as a result of the Company’s and Top Care’s breach of the SPA by Adventa Capital a notice of breach under the SPA; and

(ii) Losses suffered by Adventa Capital as a result of Low’s removal from the Management of Aspion.

In aid of the Writ Action and Singapore Arbitration, the Company and Top Care had applied for: (i) A Mareva application in the Writ Action against Wong, Low and ACPL to restrain them from disposing

their assets up to RM640,470,000. The hearing for the Mareva was fixed for hearing from 29 to 31 October 2018 and 2 November 2018. In the meantime, an ad interim injunction was allowed by the KL High Court.

(ii) A Mareva Injunction application was filed against Adventa Capital ACPL to restrain it from disposing its assets up to RM640,470,000. The hearing for the Mareva was fixed for hearing from 29 to 31 October 2018 and 2 November 2018. In the meantime, an ad interim injunction was allowed by the KL High Court.

(iii) A Mareva Injunction application in the Singapore High Court was also filed to restrain Adventa Capital from disposing its assets worldwide (save for Malaysia) up to the value of RM640,470,000. The Singapore High Court granted the Singapore Mareva Injunction. The hearing for the Mareva will continue from 29 to 30 November 2018 and 8 March 2019.

On 13 July 2018, Adventa Capital filed an application to set aside the Singapore Mareva Injunction (“Singapore Set Aside Application”). The Singapore Mareva Injunction and the Singapore Set Aside Application was part heard on 23 August 2018 by the Singapore High Court and will continue on 29 November 2018, 30 November 2018 and 8 March 2019. Further, the Company and Top Care had on 14 August 2018 filed an application to file further affidavits in respect of Adventa Capital’s application to set aside the company’s and Top Care’s Mareva order in the Singapore OS (“the Leave Application”). The Leave Application will also be heard on 29 November 2018, 30 November 2018 and 8 March 2019.

The Writ Action and the Singapore Arbitration are on-going and our solicitors are of the view that the Company and Top Care have even chance of success in our claims. In the event that the Company and Top Care do not succeed in the claims under the Writ Action, Singapore Arbitration and fail to obtain the Injunctions, the Company and Top Care would be exposed to costs and damages for the Writ Action, Singapore Arbitration and the Mareva Injunctions that may be awarded to the Defendants.




47. Subsequent events

(i) On 10 October 2018, the Company obtained shareholders’ approval at its Extraordinary General Meeting (“EGM”) for a bonus issue of 1,280,229,124 new ordinary shares on the basis of 1 bonus share for every 1 existing ordinary share. The bonus issue was completed on 29 October 2018.

(ii) The outstanding corporate proposals which have been approved by shareholders at EGM held on 10 October 2018 are as follows:

a) Proposed issuance of guaranteed exchangeable bonds with an aggregate principal amount of up to USD300 million; and

b) Proposed amendment to the constitution of Top Glove.

48. Comparative figures

Effective 1 September 2018, the Group adopted the policy to state its investment property at fair value. Previously, investment property was stated at cost.

The effect of the change in accounting policies is accounted for restrospectively. As a result of adopting this changes in accounting policies, fair value gains have been made to the opening retained earnings of the Group.

The following comparative figures have been restated arising from the effects of change in accounting polices:

As previously stated Adjustments As restated RM’000 RM’000 RM’000

Group Statement of financial position

As at 1 September 2016 Property, plant and equipment 1,156,767 (27,830) 1,128,937 Investment property 82,184 79,816 162,000 Deferred tax liabilities 50,757 2,128 52,885 Retained earnings 1,167,057 49,858 1,216,915

As at 31 August 2017 Property, plant and equipment 1,523,406 (24,920) 1,498,486 Investment property 83,156 78,844 162,000 Deferred tax liabilities 66,284 1,973 68,257 Retained earnings 1,313,876 51,951 1,365,827

Statement of profit or loss

For the financial year ended 31 August 2017 Administrative and general expenses (195,390) 1,938 (193,452) Income tax expense (54,669) 155 (54,514)

Statement of cash flows

For the financial year ended 31 August 2017 Operating activities Profit before tax 383,105 1,938 385,043

Net loss from fair value remeasurement - 3,096 3,096

Depreciation: - Property, plant and equipment 109,648 (3,611) 106,037 - Investment property 1,423 (1,423) -

49. Authorisation of financial statements for issue

The financial statements for the year ended 31 August 2018 were authorised for issue in accordance with a resolution of the directors on 31 October 2018.


PARTICULARS OF PROPERTY

DATE OFACQUISITION(A)/ REVALUATION(R)

AGE OF BUILDING (YEARS)

TENURE DESCRIPTION/EXISTING USE

LAND AREA/BUILD-UP AREA

AUDITED NET BOOK VALUE AS

AT 31.8.2018(RM’000)

A) TOP GLOVE SDN BHD

1) No.18, Jalan Mempari 10,Taman Bayu, Batu 5½,Jalan Meru, 41050 Klang,Selangor.

HS (M) 15256, PT 8368, Mukim Kapar, Daerah Klang,Selangor.

23/10/1997 (A) 20 Freehold Terrace house/Accommodation

for staff

1,300 square feet/ 1,100 square feet

93

2) No.36, Jalan Mempari 1,Taman Bayu, Batu 5½, Jalan Meru, 41050 Klang,Selangor.



for staff


38

3) No.11, Jalan Mempari 11,Taman Bayu, Batu 5½, Jalan Meru, 41050 Klang,Selangor.

HS (M) 15238, PT 8349,HS (M) 15238, PT 8445,Mukim Kapar, Daerah Klang,Selangor.


for staff


87

4) Lot 4968, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang, Selangor.

EMR 6629, Lot 4968,Mukim Kapar, Daerah Klang,Selangor.

13/10/1993 (A) 24 Freehold Factory/Glovemanufacturing

3 acres/66,980 square feet

5,188

5) Lot 5136, 6th Miles, Jalan Sungai Binjai, 41050 Klang, Selangor.

GM 3057, Lot 5136,Mukim Kapar, Daerah Klang, Selangor.

15/08/2014 (A) N/A Freehold Vacant 1.8843 hectares 12,529

6) No.23, Jalan Seri Kenangan 8, Taman Meru 3, Meru, 41050 Klang, Selangor.

HS (M) 10314, PT 15442, Mukim Kapar,Daerah Klang,Selangor.


for staff


70

7) No.22, Jalan Mempari 1, Taman Bayu, Batu 5½, Jalan Meru, 41050 Klang,Selangor.

HS (M) 15304, PT 8419,Mukim Kapar,Daerah Klang,Selangor.


for staff


93


EMR 8780, Lot 5987,Mukim Kapar,Daerah Klang,Selangor.


2.8 acres/57,250 square feet

5,107

9) Lot 4969, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang, Selangor

GM 2143, Lot 4969,Mukim Kapar,Daerah Klang,Selangor.

11/10/2000 (A) 17 Freehold Factory/Officebuilding


7,375

10) Lot 18, 27, 38 & 57,Medan Tasek, Kawasan Perindustrian Tasek,31400 Ipoh, Perak.

Lot 18, 27, 38 & 57,Medan Tasek, Kawasan Perindustrian Tasek,31400 Ipoh, Perak.

22/11/1999 (A) 18 Leasehold(Expiring on:

Lot 18-30.9.2072Lot 27-28.12.2063Lot 38-23.12.2069Lot 57-1.10.2064)

Factory/Glovemanufacturing

311,192 square feet/197,675square feet

9,665

11) No.3, 5, 7, 9, 11, 13, 15, 17, 19, 21, 23, 25 & 27, Taman Mutiara, Tasek, 31400 Ipoh, Perak.

Lot 375847 - 375859Tasek Mutiara, 31400 Ipoh, Perak.

02/11/2007 (A) 10 Freehold Terrace house/ Accommodation

for worker


1,711

12) No.29, Jalan Abadi 1,Taman Daya Meru, Batu 5½, Jalan Meru, 41050 Klang, Selangor.

GM 13955, Lot 31151,Mukim Kapar,Daerah Klang,Selangor.


for staff

139 square meter 129

13) Lot 12, Medan Tasek,Kawasan Perindustrian Tasek, 31400 Ipoh, Perak.

PN 1308, Lot 56530, Mukim Hulu Kinta, Daerah Kinta, Perak.

04/02/2010 (A) 8 Leasehold (Expiring on: 05.04.2066)

Factory/Officebuilding


6,413

14) Lot 5094 & 5977, Mukim Kapar, Daerah Klang,41050 Klang, Selangor.

GM 4326, Lot 5094 & 5977 Mukim Kapar, 4 ½ Mile Sungai Binjai Road

26/01/2018 (A) N/A Freehold Factory/Water Process

and Supply

1.794 acres 5,485

15) Plot 7, Medan Tasek, Kawasan Perindustrian Tasek, 31400 Ipoh, Perak.

HS (D) 889/68, Lot 927, Mukim Hulu Kinta, Daerah Kinta, Perak.

05/07/2011 (A) 7 Leasehold(Expiring on: 02.05.2067)



2,749

FOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018LIST OF PROPERTIES








AT 31.8.2018(RM’000)

16) Lot 4960, Jalan Teratai,Batu 6, Off Jalan Meru,41050 Klang, Selangor.




7,194


HS (M) 38148, PT Nos. 63271,Mukim Kapar,Daerah Klang, Selangor.



5,824

18) Lot 4967, Jalan Teratai,Batu 6, Off Jalan Meru,41050 Klang, Selangor




6,762


HS (M) 15324, PT 8441, HS (M) 15242, PT 8353, Mukim Kapar,


for staff


96


HS (M) 18522, PT 24689, Mukim Kapar, Daerah Klang, Selangor.


for staff

1,300 square feet/1,100 square feet

110

21) No.26, Jalan Abadi 10A/KU8, Taman Daya Maju, 41050 Klang, Selangor.

HS (M) 26112, PT 39636, Mukim Kapar, Daerah Klang, Selangor.


for staff


117

22) No.21, Jalan Sesenduk 20,Off Taman Meru Jaya,41050 Klang, Selangor.

GM 7798, Lot 37307, Mukim Kapar, Daerah Klang, Selangor.


for staff


117

23) No.23, Jalan Sesenduk 20,Off Taman Meru Jaya,41050 Klang, Selangor.



for staff


117

24) No.27, Lorong Tempinis 1,Pekan Meru, 42200 Klang, Selangor.

HS (M) 3773, PT 1286 & HS (M) 3685, PT 1285, Mukim Kapar, Daerah Klang, Selangor.


for staff


95

25) No.57, Jalan Sesenduk 5,Taman Meru Utama,41050 Klang, Selangor.



for staff


117




for staff


117




for staff


110




for staff


110

29) Lot 4947, Jalan Teratai,Batu 5½, Off Jalan Meru,41050 Klang, Selangor.


23/11/2004 (A) 13 Freehold Factory/Glove manufacturing


9,815

FOR THE FINANCIAL YEAR ENDED 31 AUGUST 2018 (CONT’D)LIST OF PROPERTIES








AT 31.8.2018(RM’000)

30) No.1, 3, 5 & 7, Jalan Abadi 1A/KU8,

No.1 - 8, Jalan Abadi 1B/KU8,

No.1, 3, 5 & 7, Jalan Abadi 1C/KU8,

No.60, 62, 64, 66, 67, 69, 71, 73, 75 & 77, Jalan Abadi 4/KU8,

No.49, 51, 53, 55, 57, 59, 62, 64, 66, 68, 70 & 72, Jalan Abadi 5/KU8,

No.46, 48, 50, 52, 54 & 56, Jalan Abadi 6/KU8,Taman Daya Maju, 41050 Klang, Selangor.

HS (M) 10598 - 10601, PT 49525 - 49528,

HS (M) 10605 - 28476,PT 40356 - 40363,

HS (M) 28477 - 28480 & 28484, PT 40367 - 40370 & 40374,

HS (M) 28481 - 28483 & 28486 - 28491, PT 40371 - 40373 & 40376 - 40381,

HS (M) 28492 - 28497 & 28499 - 28504, PT 40382 - 40387 & 40389 - 40394,

HS (M) 28505 - 28510, PT 40395 - 40400,Mukim Kapar, Daerah Klang,Selangor.


for staff

70,995 square feet 5,501

31) No.41, Jalan Abadi 3,Taman Daya Meru,41050 Klang, Selangor.



for staff

1,098 square feet 90

32) No.25, Jalan Sesenduk 20,Taman Meru Jaya,41050 Klang, Selangor.

GM 7799, Lot 37308, Mukim Kapar, Daerah Klang,Selangor.


for staff


33) No.7, Lorong Abadi 2, Batu 5½, Off Jalan Meru,Taman Daya Meru,41050 Klang, Selangor.

GM 16575, Lot 31111, Batu 6, Jalan Sungai Binjai, Mukim Kapar, Daerah Klang,Selangor.


for staff


34) No.20, Jalan Sesenduk 19, Taman Meru Jaya,41050 Klang, Selangor.

GM 7804, Lot 37313, Batu 6½, Jalan Sungai Binjai, Mukim Kapar,Daerah Klang,Selangor.


for staff


35) No.31, Jalan Mempari 12, Taman Bayu, Batu 5, Jalan Meru, 41050 Klang, Selangor.

GM 14268, Lot 38295 & HS (M) 15348, PT 8466, Batu 6, Jalan Sungai Binjai, Mukim Kapar,Daerah Klang,Selangor.


for staff

121 square meter 97

36) No.8, 10, 12, 14, 16, 18, 20, 22, 24, 26, 28, 30, 32, 34, 36, 40, 42, 44 & 46, Jalan Sesenduk 21, Taman Meru Jaya, 41050 Klang, Selangor.

GM 7790, 7789, 7788, 7787, 7786, 7785, 7784, 7783, 7782, 7781, 7780, 7779, 7778, 7777, 7776, 7774, 7773, 7772, 7771, Lot 37299, 37298, 37297, 37296, 37295, 37294, 37293, 37292, 37291, 37290, 37289, 37288, 37287, 37286, 37285, 37283, 37282, 37281, 37280, Mukim Kapar,Daerah Klang,Selangor.


for staff

190 square meter/unit

3,098

37) No.47, Jalan Sesenduk 7, Taman Meru Utama,41050 Klang, Selangor.

GM 7295, Lot 43337, Mukim Kapar,Daerah Klang,Selangor.


for staff


38) No.46, Jalan Sesenduk 7, Taman Meru Utama,Off Jalan Meru, 41050 Klang, Selangor.

GM 12533, Lot 33910, Mukim Kapar, Daerah Klang,Selangor.


for staff










AT 31.8.2018(RM’000)

39) No.1, Jalan Sesenduk 3C, Taman Meru Utama 5,41050 Klang, Selangor.

GM 15282, Lot 45058, Mukim Kapar, Tempat Batu 5½, Jalan Sungai Binjai, Daerah Klang,Selangor.


for staff


40) No.69, Jalan Sesenduk 6, No.57, Jalan Sesenduk 7, & No.59, Jalan Sesenduk 5, Taman Meru Utama,41050 Klang, Selangor.

GM 7312, 7300, 7331,Lot 43354, 43342, 43376,Mukim Kapar, Tempat Batu 5, Jalan Sungai Binjai, Daerah Klang,Selangor.


for staff

133 square meter193 square meter133 square meter

287

41) No.9, 11, 17 & 21, Jalan Sesenduk 3, No.3, Jalan Sesenduk 3C, Taman Meru Utama 55,41050 Klang, Selangor.

GM 15247, 15246, 15244, 15242, 15265, Lot 45023, 45022, 45020, 45018, 45041, Mukim Kapar, Tempat Batu 5,Jalan Sungai Binjai, Daerah Klang,Selangor.


for staff

No.9 - 21:110 square meter/unit

No.3:127 square meter/unit

126


EMR 6605, Lot 4908, Mukim Kapar, Daerah Klang,Selangor.


for staff


1,867

43) Lot 4988, 5½ Miles,Sungai Binjai Road,41050 Klang, Selangor.

GM 1584, Lot 4988,Mukim Kapar, Daerah Klang,Selangor.


3 acres/12,141 square meter

9,024

44) Lot 4989,Mukim Kapar,41050 Klang, Selangor.

GM 703, Lot 4989,Mukim Kapar, Daerah Klang,Selangor.



8,636

45) Lot 4986, Batu 5,Jalan Sungai Binjai,Mukim Kapar, 41050 Klang, Selangor.




8,083

46) Lot 4987, 5th Miles,Sungai Binjai Road,Mukim Kapar, 41050 Klang, Selangor.




8,870

47) Lot 4990, Jalan Bunga Raya, Batu 5½, Off Jalan Meru, 41050 Klang, Selangor.




8,777



14/01/2008 (A) N/A Freehold Vacant 3 acres 2,718




50) Lot 4962, 5th Miles, Sungai Binjai Road, Mukim Kapar,41050 Klang, Selangor.



51) Lot 5094, Tempat Batu 4½, Jalan Sungai Binjai, 41050 Klang, Selangor.


03/10/2008 (A) N/A Freehold Vacant 3 acres 5 pole

2,532

52) Lot 5977 & 5975, Tempat Batu 4½, Jalan Sungai Binjai, 41050 Klang, Selangor.

GM 4436 & 4437, Lot 5977 & 5975,Mukim Kapar, Daerah Klang, Selangor.

03/10/2008 (A) N/A Freehold Vacant 1.794 & 0.068acres

1,531









AT 31.8.2018(RM’000)

53) Lot 4941, Tempat Batu 6,Jalan Sungai Binjai, 41050 Klang, Selangor.





07/09/2009 (A) N/A Freehold Vacant 4 acres2 rood25 pole

6,083



30/11/2009 (A) N/A Freehold Vacant 4 acres3 rood

6,085




3 acres 4,233




for worker

1.2141 hectares 17,239



15/07/2011 (A) N/A Freehold Vacant 1.2141 hectares 5

59) Lot 5991, Tempat Batu 4½,Jalan Sungai Binjai, 41050 Klang, Selangor.



60) HS (D) 129441, PT 62956,Jalan Bukit Kapar, 41050 Klang, Selangor.

HS (D) 129441, PT 62956,Mukim Kapar, Daerah Klang, Selangor.

28/02/2011 (A) N/A Freehold Vacant 131,730 square meter

14,288




for staff





for staff


63) No.15, Jalan Abadi 10B/KU8,Taman Daya Maju,41050 Klang, Selangor.



for staff





65) Lot 5105, 4½ Miles, Jalan Sungai Binjai, 41050 Klang, Selangor.


19/11/2013 (A) N/A Freehold Vacant 4.344 acres/1.7579 hectares

13,840

66) No.25, Jalan Mempari 9,Taman Bayu,41050 Klang, Selangor.

GM 13014, Lot 307, Seksyen 1, 6th Miles, Sungai Binjai Road, Pekan Meru, Daerah Klang, Selangor.


for staff





for staff


68) No.26, Jalan Mempari 1,Taman Bayu,41050 Klang, Selangor.

GM 8479, Lot 38225, Seksyen 1, Mukim Kapar, Daerah Klang, Selangor.


for staff

121 square meter 94









AT 31.8.2018(RM’000)

69) No.30, Jalan Abadi 5,Taman Daya Maju,41050 Klang, Selangor.

Lot 31191,Mukim Kapar, Daerah Klang, Selangor.


for staff

82 square meter 104

70) No.42, Jalan Mempari 10,Batu 5½, Jalan Meru, 41050 Klang, Selangor.

GM 14219, Lot 38256, Seksyen 1, Pekan Meru,Daerah Klang, Selangor.


for staff


71) No.60, Jalan Mempari 10,Taman Bayu, Batu 5½, Jalan Meru,41050 Klang, Selangor.



for staff


72) No.58, Jalan Mempari 1,Taman Bayu, Batu 5½, Jalan Meru, 41050 Klang, Selangor.



for staff


73) Lot 5002, Batu 5½,Jalan Meru, 41050 Klang, Selangor.

GM 10245, Lot 5002,(Lot 23552), Mukim Kapar, Daerah Klang, Selangor.

29/09/2015 (A) 2 Freehold Factory 10,891 square meter

11,223

74) No.64, Jalan Sesenduk 7,Off Jalan Meru,41050 Klang, Selangor.

GM 7303, Lot 43345, Mukim Kapar,Daerah Klang, Selangor.


for staff


75) No.21, Jalan Abadi 5,Taman Saujana Meru,41050 Klang, Selangor.



for staff

121 square meter 84

76) No.25, Jalan Abadi, 10D/KU8, Taman Daya Maju, 41050 Klang, Selangor.

GM 9497, Lot 48131,Mukim Kapar,Daerah Klang, Selangor.


for staff


77) No.47, Jalan Abadi 1A/KU8,Taman Daya Maju,41050 Klang, Selangor.



for staff


78) No.43, Jalan Abadi 1A/KU8,Taman Daya Maju, Batu 6½, Off Jalan Meru,41050 Klang, Selangor.



for staff





for staff





for staff





for staff





for staff





for staff





for staff










AT 31.8.2018(RM’000)




for staff





for staff





for staff





for staff





for staff





for staff


91) No.71, Jalan Abadi 1A/KU8,Taman Daya Maju, Batu 6½, 41050 Klang, Selangor.



for staff


92) 8-2, 8-3, 8-4, 8-5,Setia Avenue,Jalan Setia Prima (S),U13/5, Setia Alam, Seksyen U13, 40170, Shah Alam, Selangor.

GM 290749, Lot 59640,Mukim Bukit Raja,Daerah Petaling,Selangor.

01/02/2012 (A) 6 Freehold Building 920.77 square meter

3,117

93) No.6, Lorong Abadi 3,Pekan Meru, Taman Saujana Meru,41050 Klang, Selangor.



for staff

111.483 square meter

112

94) No.24, Lorong Hamzah Alang 77B, Off Jalan Kapar Batu 9½, Taman Jaya, 42200 Kapar, Selangor.

HS (D) 35605, PT 19713.


for staff

120.75 square meter

104

95) No.40, Jalan Mempari 10,Taman Bayu, Batu 5½,Jalan Meru, 41050 Klang, Selangor.



for staff


96) No.28, Jalan Mempari 12,5th Miles, Jalan Meru,41050 Klang, Selangor.



for staff

105 square meter 94










1.2141 hectares 24,507




1.2141 hectares 24,716









AT 31.8.2018(RM’000)

101) Lot 4991, Jalan Bunga Raya, Batu 5½, Off Jalan Meru,41050 Klang, Selangor.

HS (M) 39325, PT 64593, Mukim Kapar,Daerah Klang, Selangor.


4.3 acres 3,242

102) Unit C-34-07, Phase 2D02, Trefoil, Level 34, Tower C, Seksyen U13, Jalan Setia Dagang, AH U13/AH, Setia Alam, 40170 Shah Alam, Selangor.

GRN 308223, Lot 61049, Daerah Petaling, Selangor.

05/01/2016 (A) 2 Freehold Strata office 45.1 square meter 268

103) Unit C-34-08, Phase 2D02, Trefoil, Level 34, Tower C, Seksyen U13, Jalan Setia Dagang, AH U13/AH, Setia Alam, 40170 Shah Alam, Selangor.

GRN 308223, Lot 61049, Daerah Petaling,Selangor.

16/12/2015 (A) 2 Freehold Strata office 45.1 square meter 268

104) Lot 5090, Batu 5½,Jalan Meru, 41050 Klang, Selangor.



12,104.55 square meter

12,962

105) Lot 4961, Tempat Batu 5, Jalan Binjai, 41050 Klang, Selangor.



3 acres 3,663

B) TG MEDICAL SDN BHD


GM 3989, Lot 5091,4½ Miles, Sungai Binjai Road, Mukim Kapar, Daerah Klang, Selangor.


3 acres/ 68,490 square feet

6,328

2) No.19, Jalan Mempari 11, Batu 5½, Jalan Meru,41050 Klang, Selangor.

HS (M) 15241, PT 8352,HS (M) 15325, PT 8442, Batu 6, Jalan Sungai Binjai, Mukim Kapar, Daerah Klang, Selangor.


for staff


85

3) Lot 5972 & 5974, Jalan Teratai, Batu 5, Jalan Meru,41050 Klang, Selangor.

GM 4098 & 4099, Lot 5972 & 5974, 4½ Miles, Sungei Benjai Road, Mukim Kapar, Daerah Klang, Selangor.


Approx 1.7935 acres/

47,200 square feet

3,205


GM 5064, Lot 5104, 12½ Miles, Sungei Berinai Road, Mukim Kapar,Daerah Klang, Selangor.


3 acres/ 54,600 square feet

6,632

5) No.1, 3, 5, 7, 9 & 11, Jalan Abadi 10D/KU8,Taman Daya Maju, Meru, 41050 Klang, Selangor.

No.1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11 & 12, Jalan Abadi 10C/KU8,Taman Daya Maju, Meru, 41050 Klang, Selangor.

No.1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11 & 12, Jalan Abadi 10A/KU8, Taman Daya Maju, Meru, 41050 Klang, Selangor.

No.1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11 & 12, Jalan Abadi 10B/KU8, Taman Daya Maju, Meru, 41050 Klang, Selangor.

No.85, 87, 89, 91, 93 & 95, Jalan Abadi 1/KU8,Taman Daya Maju, Meru, 41050 Klang, Selangor.

HS (M) 33205 - HS (M) 33252,PT 50423 - PT 50470,Mukim Kapar, Daerah Klang, Selangor.


for staff and worker

Approx 108.85 square meter/unit

6,173









AT 31.8.2018(RM’000)

6) Lot 5975,Tempat Batu 4½, Jalan Sungai Binjai, 41050 Klang, Selangor.


03/10/2008 (A) N/A Freehold Vacant 0.0275 hectares 201

7) Lot 6472, Lorong Sungai Puloh/KU6, Kawasan Perindustrian Sungai Puloh,42100 Klang, Selangor.

GRN 52371, Lot 6472,Mukim Kapar,Daerah of Klang,Selangor.

01/03/2017 (A) N/A Freehold Land 34,499 square meter

13

8) Lot 5105, 4½ Miles, Jalan Sungai Binjai, 41050 Klang, Selangor.


19/11/2013 (A) N/A Freehold Vacant 4.344 acres/1.7579 hectares

128

C) TOP GLOVE ENGINEERING SDN BHD

1) GRN 285705, Lot 213, Seksyen 2, Pekan Bukit Changgang, Daerah Kuala Langat, Selangor.

GRN 285705, Lot 213, Seksyen 2, Pekan Bukit Changgang, Daerah Kuala Langat, Selangor.

18/04/1996 (A) N/A Freehold Land 3.39 acres/13,716 square meter

1,738




1,736




1,736



12/06/2012 (A) N/A Freehold Land 19.83 acres 8,304







7) No.13, Jalan Setia Wawasan, U13/35D, Bandar Setia Alam, 40170 Shah Alam, Selangor.

HS (D) 291299, PT 32070, Mukim Bukit Raja, Daerah Petaling, Selangor.

05/01/2017 (A) 1 Freehold Bungalow/ Accommodation

for staff

397 square meter 1,756

8) No.11, Jalan Setia Wawasan, U13/35D, Bandar Setia Alam, 40170 Shah Alam, Selangor.

HS (D) 291298, PT 32069, Mukim Bukit Raja, Daerah Petaling, Selangor.

05/01/2017 (A) 1 Freehold Bungalow/ Accommodation

for staff

397 square meter 1,764









AT 31.8.2018(RM’000)

D) TOP GLOVE MEDICAL (THAILAND) CO., LTD.

1) 188, Moo 5, Karnchanawanich Road, Tambon Samnakkham, Sadao, Songkhla 90320, Thailand.

60199, 60200, 60201 & 60202, Tambon Samnakkham,Sadao, Songkhla 90320, Thailand.

28/02/2003 (A)

28/02/2003 (A)

28/02/2003 (A)

01/12/2011 (A)

01/12/2011 (A)

15

15

15

6

6

Freehold

Freehold

Freehold

Freehold

Freehold

Land

Factory/Office building

Accommodation for worker

Factory building


15.8 acers

9,504 square meter

1,200 square meter


882 square meter

2,700 (Thai Baht

21,507

6,244 (Thai Baht

49,737)

1,425 (Thai Baht

11,355)

3,201 (Thai Baht

25,499)

1,274 (Thai Baht

10,147)

2) Title Deed No.39553Moo.5 Pruteaw Karnchanawanich Road, Tambon Samnakkham, Ampur Sadao, Songkhla 90320, Thailand.

Title Deed No. 39553 Moo.5 Pruteaw Karnchanawanich Road, Tambon Samnakkham, Ampur Sadao, Songkhla 90320 Thailand.

03/03/2005 (A) N/A Freehold Pond Approx 2.8 acres 716(Thai Baht

5,702)

3) Nor. Sor. 3 Kor No.637 & 638,Tambon Samnakkham,Ampur Sadao, Songkhla 90320, Thailand.

Nor. Sor. 3 Kor No. 637 & 638,Tambon Samnakkham,Ampur Sadao, Songkhla 90320, Thailand.

16/11/2010 (A) N/A Freehold Land Approx 32 acres 6,174(Thai Baht

49,178)

4) Title Deed No.38237 & 38236,Tambon Samnakkham,Ampur Sadao, Songkhla 90320, Thailand.

Title Deed No. 38237 & 38236,Tambon Samnakkham,Ampur Sadao, Songkhla 90320, Thailand.

01/12/2016 (A) N/A Freehold Land Approx 21 acres 6,566(Thai Baht

52,305)

E) TG MEDICAL (U.S.A.), INC.

1) 165 - 167 North Aspan, Avenue, Azusa, CA 91702, USA.

Assessor’s ID #8615 018 010

31/03/2005 (A) 13 Freehold Warehouse/ Office building

25,878 square feet 8,562(USD 2,085)

2) 153 - 155 North Aspan, Avenue, Azusa, CA 91702, USA.

Assessor’s ID #8615 018 011

31/07/2013 (A) 5 Freehold Warehouse/ Office building

25,950 square feet 12,022(USD 2,927)

F) TOP GLOVE TECHNOLOGY (THAILAND) CO., LTD.

1) 188, Moo 5, Tambol Pangla,Ampur Sadao, Songkhla 90170, Thailand.

Channod No.52538, 52539 & 52540,Tambol Pangla,Ampur Sadao,Songkhla, Thailand.

23/02/2006 (A) 12 Freehold Factory/Office building

Approx 40.4 acres/47,816.68

square meter

17,131(Thai Baht136,462)

G) GREAT GLOVE (XING HUA) CO., LTD.

1) South Wei Wu Lu, Xinghua Economic Development Region,Xinghua City, Jiangsu Province, China.

South Wei Wu Lu, Zhao Yang Zheng, Xinghua City, China.


Factory/Office building, Industrial usage

112,234.48square meter/


14,498(RMB

24,112)

2) No.20, Tian Shui YuanTian Shui Hua Ting,Xinghua Economic Development Region,Xinghua City, Jiangsu Province, China.

South Wei Wu Lu, Zhao Yang Zheng, Xinghua City, China.


Accommodation for staff

153.1 square meter/342.23 square

meter

446(RMB 742)









AT 31.8.2018(RM’000)

H) B TECH INDUSTRY CO., LTD.

1) 268 M.5 T.Kampangphet A.Rattaphum, Songkhla 90180, Thailand.

1. Nor Sor 3 Kor No. 23612. Nor Sor 4 Jor No. 59433. Nor Sor 4 Jor No. 5944

4. Nor Sor 4 Jor No. 59475. Nor Sor 4 Jor No. 59486. Nor Sor 4 Jor No. 59497. Nor Sor 4 Jor No. 59508. Nor Sor 4 Jor No. 5951

01/08/2006(A)

21/08/2009 (A)

12

9

Freehold

Freehold

Factory/Office building

Waste water pond

Approx 44,718 square meter/

8,754 square meter

Approx 18.64 acres

6,408(Thai Baht

51,046)

I) FLEXITECH SDN BHD

1) Lot 127, Jalan 6, Komplek Olak Lempit, Mukim Tanjung 12, 42700 Banting, Selangor.

HS (M) 5735, PT 4065, Komplek Perabot Olak Lempit, Mukim Tanjung Dua Belas, Daerah Kuala Langat, Selangor.



Approx 11,735.87 square meter/

6,826 square meter

3,913

2) Lot 128, Jalan 8, Komplek Olak Lempit,Mukim Tanjung 12, 42700 Banting, Selangor.



Production/Warehouse


6,183 square meter

11,106




Production/Office building


10,172 square meter

7,383




Production/Office building


6,813 square meter

5,134

5) No.11, Jalan Emas 28,Bandar Sungai Emas, 42700 Banting, Selangor.

GRN 108819, Lot 630, Seksyen 5, Pekan Sungai Manggis, Mukim Tanjong Dua Belas, Daerah Kuala Langat, Selangor.

29/04/2013(A) 5 Freehold Accommodation for staff

Approx 130square meter

206

6) No.7, Jalan Emas 28,Bandar Sungai Emas, 42700 Banting, Selangor.

GRN 108817, Lot 628, Seksyen 5, Pekan Sungai Manggis, Mukim Tanjong Dua Belas, Daerah Kuala Langat, Selangor.

19/06/2013(A) 5 Freehold Accommodation for staff

Approx 130square meter

217

J) TOP QUALITY GLOVE SDN BHD

1) Lot 2604, Mukim Tanjong Dua Belas,Daerah Kuala Langat,Selangor.

GRN 47717, Lot 2604,Mukim Tanjong Dua Belas,Daerah Kuala Langat,Selangor.

25/01/2013 (A) N/A Freehold Land Approx 1.9526 hectares/4 acres 3 rood 12.0 pole

2,040




2,122




1,815




2,189









AT 31.8.2018(RM’000)

5) Lot 4961, Tempat Batu 5, Jalan Binjai, 41050 Klang, Selangor.



3 acres 8,353

6) Lot 5135, Jalan Dahlia, Off Jalan Meru,41050 Klang, Selangor.


10/07/2014 (A) N/A Freehold Vacant Approx 4.656 acres/ 202,827 square feet

13,462

7) Lot 5144 & 5145, 6th Miles, Sungei Binjai Road,41050 Klang, Selangor.

GM 2306 & 5605, Lot 5144 & 5145, Mukim Kapar,Daerah Klang, Selangor.

28/12/2016 (A) N/A Freehold Vacant Approx Lot 5144: 202,824.364 square feetLot 5145:

201,468.0994 square feet

33,556

8) Lot 4977 & 4978, Jalan Dahlia, Off Jalan Meru, 41050 Klang, Selangor.

HS (M) 40486, PT 67437, Lot 4977 & 4978, Mukim Kapar,Daerah Klang, Selangor.

01/12/2016 (A)

01/12/2016 (A)

1

1

Freehold

Freehold

Land

Factory/Building

5.45 acres/ 2.21 hectares

Double storey office building 8,874 square

feet with 2 single storey warehouse 83,087 square feet

18,526

7,105



26/03/2016 (A) N/A Freehold Vacant 3 acres 98



20/05/2016 (A) N/A Freehold Vacant 3 acres 6

11) Lot 6472, Lorong Sg Puloh / KU6, Kawasan Perindustrian Sungai Puloh, 42100 Klang

GM 52371, Lot 6472,Mukim Kapar, Daerah Klang,

10/07/2018 (A) N/A Freehold Land Approx. 34499 square meters

17,856

K) GMP MEDICARE SDN BHD

1) Lot 4991, Jalan Bunga Raya, Batu 5½, Off Jalan Meru,41050 Klang, Selangor.

HS (M) 39325, PT64593, Mukim Kapar,Daerah Klang,Selangor.


75,669 square feet 13,521

2) Lot 2431, Mukim Port Dickson, Sendayan, 71100 Siliau, Port Dickson,Negeri Sembilan.

Lot 11558,(Baki Lot 2431, PA 50813)Mukim Port Dickson, Daerah Port Dickson, Negeri Sembilan.

06/12/2012 (A) Phase 1 - 19 years

Phase 2 - 13 years

Freehold Factory/Glove manufacturing

16.7 acres/22,000 square meter

26,344




3 acres 9,971

4) Lot 3726, Kawasan Perindustrian Nilai, Mukim Setul, Daerah Seremban, 71800 Nilai, Negeri Sembilan.

GRN 164813, Lot 8196, Mukim Setul,Daerah Seremban, Negeri Sembilan.

14/08/2017 (A) N/A Freehold Land Approx 4.326 acres

19,752

5) Lot 3726, Kawasan Perindustrian Nilai, Mukim Setul, Daerah Seremban,71800 Nilai, Negeri Sembilan.

Lot 3726, Kawasan Perindustrian Nilai, Mukim Setul Daerah Seremban, 71800 Nilai, Negeri Sembilan.


Approx 14,256 square meter/153,450 square meter

6,547

6) Lot 6021, Kawasan Perindustrian Bukit Bakri,84200 Muar, Johor.

PN 9632, Lot 8728,Mukim Jalan Bakri, Muar, Johor.

14/08/2017 (A) N/A Leasehold (Expiring on: 29.12.2094)

Land 7,752 square meter

1,742

7) Lot 6021, Kawasan Perindustrian Bukit Bakri,84200 Muar, Johor.

PN 9632, Lot 8728,Mukim Jalan Bakri, Muar, Johor.


Factory/Glove manufacturing

Approx 7,808.82 square

meter/83,860 square feet

4,218









AT 31.8.2018(RM’000)

L) TOP GLOVE PROPERTIES SDN BHD

1) No.16, Persiaran Setia Dagang,Bandar Setia Alam, Seksyen U13, 40170 Shah Alam, Selangor.

HS (D) 277347, PT 29363,Mukim Bukit Raja,Daerah Petaling,Selangor.

21/09/2011 (A) 6 Freehold Office Tower 2 acres 163,900

2) No.18, Persiaran Setia Dagang, Bandar Setia Alam, Seksyen U13, 40170 Shah Alam, Selangor.

HS (D) 293019, PT 32307,Mukim Bukit Raja,Daerah Petaling,Selangor.

07/05/2015 (A) N/A Freehold Vacant 6,070.30 square meter

20,830

M) PT AGRO PRATAMA SEJAHTERA

1) The City Tower, 12th Floor 1N, JL MH Thamrin No.81, Jakarta Pusat 10310, Indonesia.

Bangka Belitung Province


Industrial Forest Plantation

Including Planting and Tapping of Rubber Trees

30,773 hectares 21,474

N) TG PORCELAIN SDN BHD



01/05/2018 (A) N/A Freehold Factory/Former Manufacturing

4,878.63 square feet

6,407

0) ASPION GROUP

1) Lot E4(3) [PT 4093], No. 2, Jalan 8, Kawasan Perindustrian Pengkalan Chepa II, 16100 Kota Bharu, Kelantan.

Lot No 5052, Mukim Panchor, Daerah Kota Bharu, Kelantan.

05/04/2018 (A)

05/04/2018 (A)

15

13

Leasehold (Expiring on: 15.02.2063)

Land

Factory/Office

2.184 hectares


2,494

4,791

2) PLO 9 & 18, Jalan Mahsuri 1, 7.5km, Jalan Mersing, Kawasan Perindustrian Kluang, 86007 Kluang, Johor.

PTD 84462, Mukim Kluang, Daerah Kluang, Johor.

05/04/2018 (A)

05/04/2018 (A)

10

7


Land

Factory Building

2.2781 hectares


2,368

18,754

3) Lot E4(4) [PT 4094], Jalan 8, Kawasan Perindustrian Pengkalan Chepa II, 16100 Kota Bharu, Kelantan.

Lot No 5053, Mukim Panchor, Daerah Kota Bharu, Kelantan.

05/04/2018 (A)

05/04/2018 (A)

15

10


Land

Factory Building

2.341 hectares


2,532

5,834

4) Lot E4(6) & Lot E4(7) [PT 4092 & PT 4091], Kawasan Perindustrian Pengkalan Chepa II, 16100 Kota Bharu, Kelantan.

Lot No 5050, 5051, Mukim Panchor, Daerah Kota Bharu, Kelantan.

05/04/2018 (A)

05/04/2018 (A)

05/04/2018 (A)

15

12

4


Freehold

Land/Biomass plant

Factory/Warehouse

Office building/ Warehouse

Lot 5050: 2.640 hectares

Lot 5051: 2.366 hectares


2.64 hectares

5,423

5,977

4,072

5) PLO 5, Jalan Mahsuri 1,KM 7.5, Jalan Mersing, Kawasan Perindustrian Kluang, 86007 Kluang, Johor.

Lot PTD 38818,No. HS(D) 23914,Mukim of Kluang,Daerah Kluang, Johor .



3 acres/7,515.14

square meter

3,863

6) PLO 5, Jalan Mahsuri 1,KM 7.5, Jalan Mersing, Kawasan Perindustrian Kluang, 86007 Kluang, Johor.

Lot PTD 26427,No. HS(D) 25436,Mukim of Kluang,Daerah Kluang,Johor.



3.206 acres/ 8,929.41

square meter

7,268

7) Lot 366,GM 2547,Mukim of Kluang,Daerah Kluang, Johor.

GM 2547,Mukim of Kluang,Daerah Kluang,Johor.

05/04/2018 (A) NA Freehold Agricultural land 1.467 hectares 363

8) Lot 7, Jalan Hi Tech 12,Kulim Hi Tech Park (Phase 3), 09090 Kulim, Kedah.

Lot 7 (PT2487), Kulim Hi-Tech Park, Bandar Kulim, Daerah Kulim, Kedah Darul Aman.

05/04/2018 (A) 5 Freehold Land

Factory

2,252,052 square feet

1,316,383 square feet

33,866

29,971









AT 31.8.2018(RM’000)

9) Rua Ricardo Georg, No 1.115 Itoupava Central - CEP 89.069-100 Blumenau - Santa Catarina, Brasil.

CEP 89.069-100 Blumenau - Santa Catarina, Brasil.


Office building/ Warehouse

1,300 square meter

65

P) DURAMEDICAL SDN BHD

1) No. 39 Jalan Utarid U5/27, Bandar Pinggiran Subang, Seksyen U5, 40150 Shah Alam, Selangor.

PN 18556 Lot No.41047, Mukim of Sungai Buloh, Petaling, Selangor.


Land shop 279 square meter 2,409

2) No. 32 Jalan Meru Indah 20, Taman Perindustrian Meru Indah, Off Persiaraan Hamzah Alang, 42200 Klang, Selangor Darul Ehsan.

GRN 54893, Lot No. 34096,Mukim Kapar, Klang, Selangor.

14/05/2018 (A) 3 Freehold One and half storey Semi-

Detached Factory


Q) GREAT GLOVE (THAILAND) CO., LTD.

1) 180/3 Moo.7,Srisonthon Rd., T.Srisonthon, A.Thalang, Phuket 83110 Thailand.

180/3 Moo.7,Srisonthon Rd., T.Srisonthon, A.Thalang, Phuket 83110 Thailand.

28/02/2006 (A)

01/10/2016 (A)

12

1

Freehold

Freehold

Building Block A

Building Block B

3,832 square meter

4,616 square meter

3,227(Thai Baht

25,703)

12,279 (Thai Baht

97,811)

R) TG FMT SDN BHD

1) Lot 4987, Jalan Bunga Raya, Batu 6 Off Jalan Meru, 41050 Klang,Selangor D.E.

Block B, Lot 4987, Jalan Bunga Raya, Batu 6 Off Jalan Meru, 41050 Klang,Selangor D.E.

01/06/2017 (A) 1 Freehold Building 24,400 square feet 3,569

S) EASTERN PRESS SDN BHD

1) Lot 1, Jalan Paku 16/6,40000 Shah Alam.

HS (D) 167430 Lot 1,Mukim Damansara,Petaling Jaya, Selangor.


Production use 3,121.44 square meter

5,323


Q.T. R. 4248 L.O.No Lot 3, Jalan Paku 2/6,Mukim Damansara,District Klang.



5,096


Kawasan KilangBerderet Seksyen 16,Shah Alam, Selangor.



4,152

4) Lot 13 & Lot 15, Jalan Paku 2/6, 40000 Shah Alam.

Q.T. R. 4253 & 4254, Jalan Paku 2/6, Mukim of Damansara, District Klang.

05/01/2018 (A) 22

22

Leasehold(Expiring on: 15.01.2068)

Production use

Production use

Lot 13: 2,707.41 square meter

Lot 15: 2,856.16 square meter

7,703

5) Unit B2-602 Block 2,Pangsapuri Anggerik Indah,Jalan Sempadan 16/7, Seksyen 16, 40200 Shah Alam, Selangor.

Lot 10970, Section 16,Shah Alam / Petaling /Pajakan Negeri 110147Apartment.


Workers apartment

823 square feet 63

6) Unit B2-604 Block 2,Pangsapuri Anggerik Indah,Jalan Sempadan 16/7, Seksyen 16, 40200 Shah Alam, Selangor.

Lot 10970, Section 16,Shah Alam / Petaling /Pajakan Negeri 110147Apartment


Workers apartment

740 square feet 70



AS AT 29 OCTOBER 2018ANALYSIS OF SHAREHOLDINGS

Share Capital

Total Issued Share : 2,560,458,248 Ordinary SharesTypes of Shares : Ordinary ShareVoting Rights : One (1) vote per Ordinary Share on a poll

1. DISTRIBUTION OF SHAREHOLDINGS

Size of Holdings No. of Holders^ %^ No. of Holdings^ %^

1 to 99 168 1.08 3,726 0.00

100 to 1,000 4,000 25.75 2,314,778 0.09

1,001 to 10,000 8,225 52.96 33,771,828 1.32

10,001 to 100,000 2,318 14.92 70,239,266 2.75

100,001 to 127,815,841 (less than 5% of Issued Shares)

820 5.28 2,304,346,476 90.14

127,815,842 (5% of Issued Shares) and above

1 0.01 145,640,774 5.70

Total 15,532 100.00 2,556,316,848 100.00

Note: ^ ExcludingTreasuryShares

2. SUBSTANTIAL SHAREHOLDERS

The Substantial Shareholders of the Company based on the Register of Substantial Shareholders of the Company and their respective shareholdings are as follows:

No. Name of Substantial Shareholders

No. of Ordinary Shares Held

Direct %^ Indirect %^

1. Tan Sri Dr Lim Wee Chai 739,829,552 28.941 174,443,216 * 6.824

2. Puan Sri Tong Siew Bee 7,230,392 0.283 907,042,376 ** 35.482

3. Lim Hooi Sin 38,563,648 1.509 875,675,120 *** 34.255

4. Lim Jin Feng 34,000 0.001 875,675,120 *** 34.255

5. Firstway United Corp 128,615,176 5.031 - -

6. Employees Provident Fund Board 155,707,474 6.091 - -

7. Kumpulan Wang Persaraan (Diperbadankan)

130,801,200 5.117 12,557,766 0.491

Note: ^ Calculatedbasedon2,556,316,848OrdinaryShares(issuedsharecapitalof2,560,458,248Ordinary

ShareslessTreasurySharesof4,141,400) * DeemedinterestedthroughPuanSriTongSiewBee,Mr.LimHooiSin,Mr.LimJinFengandFirstway

UnitedCorp’sdirectinterestinTopGlove ** DeemedinterestedthroughTanSriDrLimWeeChai,Mr.LimHooiSin,Mr.LimJinFengandFirstway

UnitedCorp’sdirectinterestinTopGlove *** DeemedinterestedthroughTanSriDrLimWeeChai,PuanSriTongSiewBeeandtheirdirectinterest

inFirstwayUnitedCorp


AS AT 29 OCTOBER 2018 (CONT’D)ANALYSIS OF SHAREHOLDINGS

3. DIRECTORS’ SHAREHOLDINGS

The Directors’ Shareholdings of Top Glove based on the Register of Directors’ Shareholdings and/or Record of Depositors are as follows:

No. Name of Directors No. of Ordinary Shares HeldDirect %^ Indirect %^

1. Tan Sri Dr Lim Wee Chai 739,829,552 28.941 174,443,216* 6.8242. Tan Sri Dato’ Seri Utama Arshad Bin Ayub 1,600,000 0.063 - -3. Tan Sri Rainer Althoff - - - -4. Dato’ Lee Kim Meow 973,600 0.038 40,000** 0.0025. Puan Sri Tong Siew Bee 7,230,392 0.283 907,042,376*** 35.4826. Lim Hooi Sin 38,563,648 1.509 875,675,120**** 34.2557. Lim Cheong Guan 297,600 0.012 - -8. Dato’ Lim Han Boon - - - -9. Datuk Noripah Binti Kamso - - - -10. Sharmila Sekarajasekaran 10,000,000 0.391 - -11. Tay Seong Chee, Simon - - - -12. Datuk Dr. Norma Mansor - - - -

Note: ^ Calculatedbasedon2,556,316,848OrdinaryShares(issuedsharecapitalof2,560,458,248OrdinarySharesless

TreasurySharesof4,141,400) * DeemedinterestedthroughPuanSriTongSiewBee,Mr.LimHooiSin,Mr.LimJinFengandFirstwayUnited

Corp’sdirectinterestinTopGlove ** Deemedinterestedthroughhiswife,DatinChungLeeMoy *** DeemedinterestedthroughTanSriDrLimWeeChai,Mr.LimHooiSin,Mr.LimJinFengandFirstwayUnited

Corp’sdirectinterestinTopGlove **** DeemedinterestedthroughTanSriDrLimWeeChai,PuanSriTongSiewBeeandtheirdirectinterestinFirstway

UnitedCorp

The Directors’ Share Options held under the Employees’ Share Option Scheme of the Company based on the Register of Directors’ Shareholding are as follows:

No. Name of Directors No. of Options HeldDirect Indirect

1. Tan Sri Dr Lim Wee Chai 370,000 77,800*2. Tan Sri Dato’ Seri Utama Arshad Bin Ayub - -3. Tan Sri Rainer Althoff - -

4. Dato’ Lee Kim Meow 122,000 -5. Puan Sri Tong Siew Bee 18,200 429,600**6. Lim Hooi Sin 49,200 388,200***7. Lim Cheong Guan 108,800 -8. Dato’ Lim Han Boon - -

9. Datuk Noripah Binti Kamso - -10. Sharmila Sekarajasekaran - -11. Tay Seong Chee, Simon - -12. Datuk Dr. Norma Mansor - -

Note: * DeemedinterestedthroughPuanSriTongSiewBee,Mr.LimHooiSinandMr.LimJinFeng’soptionsheldinTop

Glove ** DeemedinterestedthroughTanSriDrLimWeeChai,Mr.LimHooiSinandMr.LimJinFeng’soptionsheldinTop

Glove *** DeemedinterestedthroughTanSriDrLimWeeChaiandPuanSriTongSiewBee’soptionsheldinTopGlove


AS AT 29 OCTOBER 2018 (CONT’D)ANALYSIS OF SHAREHOLDINGS

4. THIRTY (30) LARGEST SECURITIES ACCOUNT HOLDERS AS PER THE RECORD OF DEPOSITORSNo. Names Shareholdings %^ 1. Citigroup Nominees (Tempatan) Sdn. Bhd.

- Employees Provident Fund Board145,640,774 5.70

2. Kumpulan Wang Persaraan (Diperbadankan) 125,840,000 4.923. DB (Malaysia) Nominee (Tempatan) Sendirian Berhad

- Bank of Singapore Limited for Tan Sri Dr Lim Wee Chai105,600,000 4.13

4. RHB Capital Nominees (Tempatan) Sdn. Bhd.- Pledged securities account for Tan Sri Dr Lim Wee Chai

77,000,000 3.01

5. UOBM Nominees (Tempatan) Sdn. Bhd.- United Overseas Bank Nominees (Pte) Ltd for Tan Sri Dr Lim Wee Chai

76,000,000 2.97

6. CIMSEC Nominees (Asing) Sdn. Bhd.- CIMB Bank for Firstway United Corp

72,615,176 2.84

7. Public Nominees (Tempatan) Sdn. Bhd.- Pledged securities account for Tan Sri Dr Lim Wee Chai

62,500,000 2.44

8. CIMSEC Nominees (Tempatan) Sdn. Bhd.- CIMB Bank for Tan Sri Dr Lim Wee Chai

61,800,000 2.42

9. Maybank Nominees (Tempatan) Sdn. Bhd.- Maybank Trustees Berhad for Public Regular Savings Fund

61,538,200 2.41

10. Cartaban Nominees (Tempatan) Sdn. Bhd.- Standard Chartered Bank Singapore Branch (Private Bank) for Tan

Sri Dr Lim Wee Chai

56,000,000 2.19

11. Citigroup Nominees (Tempatan) Sdn. Bhd.- UBS AG Singapore for Tan Sri Dr Lim Wee Chai

55,000,000 2.15

12. CIMB Group Nominees (Tempatan) Sdn. Bhd.- Pledged securities account - DBS Bank Ltd for Tan Sri Dr Lim Wee Chai

50,000,000 1.96

13. MFP Capital Corporation 44,900,000 1.7614. DB (Malaysia) Nominee (Asing) Sdn. Bhd.

- Exempt an for Bank of Singapore Limited 44,024,000 1.72

15. RHB Capital Nominees (Asing) Sdn. Bhd.- Pledged securities account for Firstway United Corp (RHB Bank (L) Ltd.)

44,000,000 1.72

16. Citigroup Nominees (Asing) Sdn. Bhd.- Exempt an for the Central Depository (Pte) Limited

41,436,400 1.62

17. HSBC Nominees (Tempatan) Sdn. Bhd.- Pledged securities account - HBAP SG for Tan Sri Dr Lim Wee Chai

38,000,000 1.49

18. DB (Malaysia) Nominee (Asing) Sdn. Bhd.- State Street Australia Fund Remi for Retail Employees

Superannuation Trust

32,163,280 1.26

19. Citigroup Nominees (Asing) Sdn. Bhd.- Exempt an for State Street Bank & Trust Company (West CLT OD67)

31,516,000 1.23

20. Citigroup Nominees (Asing) Sdn. Bhd.- Exempt an for Citibank New York (Norges Bank 9)

29,855,636 1.17

21. Citigroup Nominees (Asing) Sdn. Bhd.- CBHK for Hostplus Pooled Superannuation Trust (Northcape Cap)

28,823,664 1.13

22. HSBC Nominees (Asing) Sdn. Bhd.- JPMCB na for Vanguard Emerging Markets Stock Index Fund

27,006,200 1.06

23. HSBC Nominees (Asing) Sdn. Bhd.- JPMCB na for Vanguard Total International Stock Index Fund

25,195,000 0.99

24. Citigroup Nominees (Tempatan) Sdn. Bhd.- UBS AG Singapore for Tan Sri Dr Lim Wee Chai

25,000,000 0.98

25. Malaysia Nominees (Tempatan) Sendirian Berhad- Great Eastern Life Assurance (Malaysia) Berhad (Par 1)

24,890,000 0.97

26. Cartaban Nominees (Tempatan) Sdn. Bhd.- PAMB for Prulink Equity Fund

22,539,200 0.88

27. CIMB Group Nominees (Tempatan) Sdn. Bhd.- Pledged securities account for Tan Sri Dr Lim Wee Chai (HGDL- CBM-LC1)

22,000,000 0.86

28. HSBC Nominees (Asing) Sdn. Bhd.- BPSS SYD for Northcape Capital Global Emerging Markets Fund

20,755,436 0.81

29. Lim Hooi Sin 20,578,920 0.8130. Amanahraya Trustees Berhad

- Public Islamic Dividend Fund20,539,400 0.80

Total 1,492,757,286 58.39

Note:^ Calculated based on 2,556,316,848 Ordinary Shares (issued share capital of 2,560,458,248OrdinaryShareslessTreasurySharesof4,141,400)


NOTICE IS HEREBY GIVEN THAT the Twentieth Annual General Meeting (“20th AGM”) of the Company will be held at TG Grand Ballroom 1, Level 9, Top Glove Tower of 16, Persiaran Setia Dagang, Setia Alam, Seksyen U13, 40170 Shah Alam, Selangor Darul Ehsan, Malaysia on Tuesday, 8 January 2019 at 10:30 a.m. for the following purposes:

AGENDA

1. To receive the Audited Financial Statements for the financial year ended 31 August 2018 together with the Reports of the Directors and the Auditors thereon.

2. To approve the declaration of a Single Tier Final Dividend of 5.0 sen per share for the financial year ended 31 August 2018.

3. To re-elect the following Directors who retire pursuant to Article 94 of the Company’s Constitution and being eligible, have offered themselves for re-election:

(a) Dato’ Lee Kim Meow (b) Puan Sri Tong Siew Bee (c) Lim Hooi Sin

4. To approve the payment of Directors’ Fees for the financial year ended 31 August 2018.

5. To approve the payment of Directors’ Benefits (excluding Directors’ Fees) to the Non-Executive Directors up to an amount of RM200,000.00 from 9 January 2019 until the next Annual General Meeting of the Company to be held in year 2020.

6. To re-appoint Messrs. Ernst & Young as Auditors of the Company until the conclusion of the next Annual General Meeting and to authorise the Directors to fix their remuneration.

7. As Special Business

To consider and, if thought fit, with or without any modification, to pass the following resolutions which will be proposed as Ordinary Resolutions:

(a) Ordinary Resolution No. 1

Authority to Issue Shares pursuant to the Companies Act 2016 (“the Act”)

“THAT subject to the Act, the Constitution of the Company, and the approvals from Bursa Malaysia Securities Berhad (“Bursa Securities”) and any relevant governmental/regulatory authority, the Directors of the Company be and are hereby empowered, pursuant to the Act, to issue and allot shares in the Company, at any time to such persons and upon such terms and conditions and for such purposes as the Directors may, in their absolute discretion, deem fit, provided that the aggregate number of shares issued pursuant to this resolution does not exceed ten per centum (10%) of the total number of issued shares of the Company for the time being; AND THAT the Directors be and are also empowered to obtain the approval for the listing of and quotation for the additional shares so issued on Bursa Securities; AND FURTHER THAT such authority shall commence immediately upon the passing of this resolution and continue to be in force until the conclusion of the next Annual General Meeting of the Company.”

(Refer to Note 2)

(Resolution 1)

(Resolution 2)(Resolution 3)(Resolution 4)

(Resolution 5)

(Resolution 6)

(Resolution 7)

(Resolution 8)

NOTICE OF THE TWENTIETH ANNUAL GENERAL MEETING


(b) Ordinary Resolution No. 2

Proposed Renewal of Share Buy-Back Authority

“THAT subject to the Companies Act 2016 (“the Act”), the Company’s Constitution, Bursa Malaysia Securities Berhad (“Bursa Securities”) Main Market Listing Requirements (“Main LR”) and the approvals of all relevant governmental and/or regulatory authorities (if any), the Company be and is hereby authorised to purchase such amount of ordinary shares in the Company (“Proposed Share Buy-Back”) as may be determined by the Board from time to time through Bursa Securities upon such terms and conditions as the Board may deem fit and expedient in the interest of the Company provided that the aggregate number of shares purchased pursuant to this resolution shall not exceed ten per centum (10%) of the total number of issued shares of the Company;

THAT the maximum amount of funds to be utilised for the purpose of the Proposed Share Buy-Back shall not exceed the aggregate retained profits of the Company based on its audited financial statements for the financial year ended 31 August 2018;

THAT at the discretion of the Board, the shares of the Company to be purchased are proposed to be cancelled and/or retained as treasury shares and/or distributed as dividends and/or resold on Bursa Securities and/or transferred the shares for the purposes of or under an employees’ share scheme in the manner as prescribed by the Act, rules, regulations and orders made pursuant to the Act and the Main LR of Bursa Securities and any other relevant authorities for the time being in force;

THAT such authority shall commence immediately upon passing of this resolution until:

(i) the conclusion of the next Annual General Meeting of the Company following this general meeting at which such resolution was passed at which time it will lapse unless by ordinary resolution passed at that Meeting, the authority is renewed, either unconditionally or subject to conditions;

(ii) the expiration of the period within which the next Annual General Meeting after that date is required by law to be held; or

(iii) the authority is revoked or varied by ordinary resolution passed by the shareholders of the Company in general meeting,

whichever is the earlier;

AND THAT the Board be and is hereby authorised to take such steps to give full effect to the Proposed Share Buy-Back with full power to assent to any condition, modification, variation and/or amendment as may be imposed by the relevant authorities and/or to do all such acts and things as the Board may deem fit and expedient in the best interest of the Company.”

(Resolution 9)

(CONT’D)NOTICE OF THE 20TH AGM


(c) Ordinary Resolution No. 3

Proposed Allocation of Awards to Ang Eng Li Andrea

“THAT pursuant to the Employees’ Share Grant Plan (“ESGP”) as approved by the shareholders under Ordinary Resolution 2 at the Extraordinary General Meeting held on 6 January 2016, approval be and is hereby given to the Board to authorise the ESGP Committee to award, from time to time throughout the duration of the ESGP, up to 300,000 Top Glove Shares under the ESGP to Ang Eng Li Andrea, a person connected with Tan Sri Dr Lim Wee Chai and Puan Sri Tong Siew Bee, provided that not more than ten per centum (10%) of the Top Glove Shares made available under the ESGP and any other schemes involving issuance of new Top Glove Shares to employees which may be implemented from time to time by the Company is allocated to her if she, either singly or collectively through persons connected with her, holds twenty per centum (20%) or more of the total number of issued shares of the Company (excluding treasury shares), subject always to such terms and conditions of the By-Laws and/or any adjustments which may be made in accordance with the provisions of the By-Laws and Listing Requirements, or any prevailing guidelines issued by Bursa Securities or any other relevant authorities, as amended from time to time.”

(d) Ordinary Resolution No. 4

Proposed Allocation of Options to Ang Eng Li Andrea

“THAT pursuant to the new Employees’ Share Option Scheme (“ESOS”) as approved by the shareholders under Ordinary Resolution 1 at the Extraordinary General Meeting held on 9 January 2018, approval be and is hereby given to the Board to authorise the ESOS Committee to offer, from time to time throughout the duration of the new ESOS, options to subscribe for up to 300,000 new Top Glove Shares under the new ESOS to Ang Eng Li Andrea, a person connected with Tan Sri Dr Lim Wee Chai and Puan Sri Tong Siew Bee, provided that not more than ten per centum (10%) of the Top Glove Shares made available under the new ESOS and any other employee share schemes which may be implemented from time to time by the Company is allocated to her if she, either singly or collectively through persons connected with her, holds twenty per centum (20%) or more of the total number of issued Top Glove Shares (excluding treasury shares), subject always to such terms and conditions of the new ESOS By-Laws and/or any adjustments which may be made in accordance with the provisions of the new ESOS By-Laws and Listing Requirements, or any prevailing guidelines issued by Bursa Securities or any other relevant authorities, as amended from time to time.”

(e) Special Resolution

Proposed Adoption of the New Constitution of the Company

“THAT approval be and is hereby given to revoke the existing Constitution of the Company with immediate effect and in place thereof, the proposed new Constitution of the Company, as set out in Part C of the Circular to Shareholders dated 14 November 2018 despatched together with the Company’s Annual Report 2018 be and is hereby adopted as the Constitution of the Company (“Proposed Adoption”);

AND THAT the Directors of the Company be and are hereby authorised to assent to any modification, variation and/or amendment as may be required by the relevant authorities (if any) and to do all acts and things and take all such steps as may be considered necessary to give effect to the Proposed Adoption.”

8. To transact any other ordinary business for which due notice shall have been given.

(Resolution 10)

(Resolution 11)

(Resolution 12)



NOTICE OF DIVIDEND ENTITLEMENT

NOTICE IS ALSO HEREBY GIVEN THAT a Single Tier Final Dividend of 5.0 sen per share in respect of the financial year ended 31 August 2018 will be payable on 25 January 2019 to Depositors who are registered in the Record of Depositors at the close of business on 11 January 2019, if approved by members at the forthcoming 20th AGM on 8 January 2019.

A Depositor shall qualify for entitlement only in respect of:

(a) Shares transferred into the Depositor’s Securities Account before 4:00 p.m. on 11 January 2019 in respect of ordinary transfers; and

(b) Shares bought on Bursa Malaysia Securities Berhad (“Bursa Securities”) on a cum entitlement basis according to the Rules of Bursa Securities.

By Order of the Board

CHUA SIEW CHUAN CHIN MUN YEE LIM KEAT SEE(MAICSA 0777689) (MAICSA 7019243) (MAICSA 7020290)Chartered Secretary Chartered Secretary Chartered Secretary

SHAH ALAM14 November 2018

NOTES TO THE NOTICE OF THE 20TH AGM:

1. Proxy

i. In respect of deposited securities, only members whose names appear in the Record of Depositors on 31 December 2018 (General Meeting Record of Depositors) shall be eligible to attend the Meeting.

ii. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint not more than two (2) proxies to attend and vote in his stead. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy. There shall be no restriction as to the qualification of the proxy. A proxy appointed to attend and vote at the Meeting shall have the same rights as the member to speak at the Meeting.

iii. Where a holder appoints more than one (1) proxy, the appointment shall be invalid unless he specifies the proportion of his shareholdings to be represented by each proxy.

iv. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is a corporation, either under its seal or under the hand of an officer or attorney duly authorised.

v. Where a member of the Company is an exempt authorised nominee which holds ordinary shares in the Company for multiple beneficial owners in one (1) securities account (“omnibus account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

vi. The instrument appointing a proxy must be deposited at the office of the Share Registrar, Securities Services (Holdings) Sdn. Bhd. at Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Wilayah Persekutuan, Malaysia not less than forty-eight (48) hours before the time appointed for holding the Meeting or at any adjournment thereof.



2. Audited Financial Statements for the financial year ended 31 August 2018

The Audited Financial Statements under Agenda 1 is meant for discussion only as the provision of Section 340(1) of the Companies Act 2016 (“the Act”) does not require the Audited Financial Statements to be formally approved by the shareholders. As such, this item is not put forward for voting.

3. Declaration of a Single Tier Final Dividend of 5.0 sen per share for the financial year ended 31 August 2018

The Company’s existing dividend policy provides that the Company intends to pay annual dividends of not less than 50% of its Profit after Tax and Minority Interests, subject to a number of factors including the Company’s available cash and cash equivalents, return on equity and retained earnings, the Company’s projected levels of capital expenditure and other investment plans and other factors considered relevant by the Board.

In accordance with Article 153 of the Company’s Constitution, the Company in general meeting may declare dividends, but no dividend shall exceed the amount recommended by the Directors. A Single Tier Final Dividend of 5.0 sen per share based on 2,556,365,448 ordinary shares (the adjusted issued share capital after netting 4,141,400 treasury shares) as at the date of the Notice amounting to RM127,818,272.40 in respect of the financial year ended 31 August 2018 is proposed for shareholders’ approval. The actual amount of Single Tier Final Dividend per ordinary share would be dependent on the actual number of ordinary shares as at the book closure date. Pursuant to Paragraph 8.26 of Bursa Securities Main LR , the Single Tier Final Dividend, if approved, shall be paid not later than three (3) months from the date of the shareholders’ approval.

4. Re-election of Directors who retire by rotation pursuant to Article 94 of the Company’s Constitution Article 94 of the Company’s Constitution provides that one third (1/3) of the Directors of the Company for the

time being shall retire by rotation at an Annual General Meeting (“AGM”) of the Company. All the Directors shall retire from office once at least in each three (3) years but shall be eligible for re-election.

Tan Sri Dato’ Seri Utama Arshad Bin Ayub who has served on the Board as an Independent Non-Executive Director for more than 12 years and who retires by rotation in accordance with Article 94 of the Constitution, has notified the Board that he does not wish to seek re-election as Director. Hence, he shall retires as Director at the conclusion of the 20th AGM.

The profiles of the Directors who are standing for re-election as per Agenda 3 of the Notice of the 20th AGM are stated on pages 12 and 14 of this Annual Report.

5. Determination and Payment of Directors’ Fees

Paragraph 7.24 of Bursa Securities Main LR stipulates that the fees of directors, and any benefits payable to directors shall be subject to annual shareholders’ approval at a general meeting. Therefore, shareholders’ approval is required for the determination and payment of Directors’ Fees amounting to RM1,201,600.00 for the financial year ended 31 August 2018.

6. Directors’ Benefits (excluding Directors’ Fees)

The Directors’ Benefits (excluding Directors’ Fees) comprise the meeting allowances payable to the Non-Executive Directors. The meeting allowances are fixed as follows:

Type of Meeting Meeting Allowance per Meeting (RM)

Chairman Non-Executive Director/Member

Board Nil 1,250.00

General Nil 1,250.00

Board Committee 1,000.00 750.00



In determining the estimated total Directors’ Benefits (excluding Directors’ Fees) for the period commencing 9 January 2019 until the next AGM (“Relevant Period”), the arrears payment to the Director for the period from 1 July 2018 to 8 January 2019 which exceeded the amount approved by the shareholders in the 19th AGM and the size of the Board and Board Committees as well as the estimated number of meetings scheduled to be held during the Relevant Period were taken into consideration.

7. Re-appointment of Auditors

The Audit Committee and the Board have considered the re-appointment of Messrs. Ernst & Young as Auditors of the Company and collectively agreed that Messrs. Ernst & Young have met the relevant criteria prescribed by Paragraph 15.21 of Bursa Securities Main LR.

EXPLANATORY NOTE TO SPECIAL BUSINESS:

1. Authority to Issue Shares pursuant to the Act

The proposed adoption of Ordinary Resolution No. 1 is for the purpose of granting a renewed general mandate (“General Mandate”) and empowering the Directors of the Company, pursuant to the Act, to issue and allot new shares in the Company from time to time provided that the aggregate number of shares issued pursuant to the General Mandate does not exceed ten per centum (10%) of the total number of issued shares of the Company for the time being. The General Mandate, unless revoked or varied by the Company in general meeting, will expire at the conclusion of the next AGM of the Company.

The General Mandate will provide flexibility to the Company for allotment of shares for any possible fundraising activities, including but not limited to placement of shares for the purpose of funding future investment project(s), working capital and/or acquisition(s).

As at the date of this Notice, there were no new shares issued pursuant to the mandate granted to the Directors at the Nineteenth (19th) AGM held on 9 January 2018 and which will lapse at the conclusion of the 20th AGM.

2. Proposed Renewal of Authority for Share Buy-Back

The proposed adoption of Ordinary Resolution No. 2 is for the purpose of renewing the authority granted by the shareholders of the Company at the 19th AGM held on 9 January 2018. The aforesaid proposed renewal will allow your Board of Directors to exercise the power of the Company to purchase not more than ten per centum (10%) of the total number of issued shares of the Company at any time within the time period stipulated in Bursa Securities Main LR.

3. Proposed Allocation of Awards to Ang Eng Li Andrea

The proposed adoption of Ordinary Resolution No. 3, if passed, will enable the Company to award Ang Eng Li Andrea, the person connected to Tan Sri Dr Lim Wee Chai and Puan Sri Tong Siew Bee, up to 300,000 shares of the Company (“Top Glove Shares”) to be issued to and/or vested in her pursuant to the Employees’ Share Grant Plan (“ESGP”) over a period of ten (10) years commencing from the date on which the ESGP takes effect. Ang Eng Li Andrea and persons connected to her shall abstain from voting on this resolution. Tan Sri Dr Lim Wee Chai and Puan Sri Tong Siew Bee had also abstained from all deliberation and voting on this resolution at the Board of Directors’ Meeting.

4. Proposed Allocation of Options to Ang Eng Li Andrea

The proposed adoption of Ordinary Resolution No. 4, if passed, will enable the Company to award Ang Eng Li Andrea, the person connected to Tan Sri Dr Lim Wee Chai and Puan Sri Tong Siew Bee, up to 300,000 Top Glove Shares to be issued to and/or vested in her pursuant to the new Employees’ Share Option Scheme (“ESOS”) over a period of ten (10) years commencing from the date on which the new ESOS takes effect. Ang Eng Li Andrea and persons connected to her shall abstain from voting on this resolution. Tan Sri Dr Lim Wee Chai and Puan Sri Tong Siew Bee had also abstained from all deliberation and voting on this resolution at the Board of Directors’ Meeting.



5. Proposed Adoption of the New Constitution of the Company (“Proposed Adoption”)

The proposed adoption of Special Resolution, if passed, will streamline the Company’s Constitution with the new provisions of the Companies Act 2016, amendments made to Bursa Securities Main LR and enhance administrative efficiency. The Board proposed that the existing Constitution be revoked in its entirety and the proposed new Constitution of the Company as set out in Part C of the Circular be adopted as the new Constitution of the Company.

The Proposed Adoption shall take effect once it has been passed by a majority of not less than 75% of such members who are entitled to attend and vote and do vote in person or by proxy at the 20th AGM.

Personal data privacy:

By submitting an instrument appointing a proxy(ies) and/or representative(s) to attend, speak and vote at the AGM and/or any adjournment thereof, a member of the Company (i) consents to the collection, use and disclosure of the member’s personal data by the Company (or its agents) for the purpose of the processing and administration by the Company (or its agents) of proxies and representatives appointed for the AGM (including any adjournment thereof) and the preparation and compilation of the attendance lists, minutes and other documents relating to the AGM (including any adjournment thereof), and in order for the Company (or its agents) to comply with any applicable laws, listing rules, regulations and/or guidelines (collectively, the “Purposes”), (ii) warrants that where the member discloses the personal data of the member’s proxy(ies) and/or representative(s) to the Company (or its agents), the member has obtained the prior consent of such proxy(ies) and/or representative(s) for the collection, use and disclosure by the Company (or its agents) of the personal data of such proxy(ies) and/or representative(s) for the Purposes, and (iii) agrees that the member will indemnify the Company in respect of any penalties, liabilities, claims, demands, losses and damages as a result of the member’s breach of warranty.

STATEMENT ACCOMPANYING NOTICE OF AGM As at date of this notice, there are no individuals who are standing for election as Directors (excluding the above Directors who are standing for re-election) at this 20th AGM.


Watertighttestforglovequalityinspection


Date : Tuesday, 8 January 2019

Time : 10.30 a.m.

Venue of Meeting : TG Grand Ballroom 1 Level 9, Top Glove Tower of 16, Persiaran Setia Dagang, Setia Alam, Seksyen U13, 40170 Shah Alam, Selangor Darul Ehsan, Malaysia

Time & Place of Registration : From 8.30 a.m. onwards Level 2, Top Glove Tower of 16, Persiaran Setia Dagang, Setia Alam, Seksyen U13, 40170 Shah Alam, Selangor Darul Ehsan, Malaysia

REGISTRATION

1. Registration will commence at 8.30 a.m. and will remain open until the conclusion or adjournment of the Twentieth Annual General Meeting (“AGM”) or such time as may be determined by the Chairman of the meeting.

2. Please produce your ORIGINAL National Registration Identification Card (“NRIC”)/ Passport during registration for verification. Kindly ensure that you collect your NRIC/Passport upon completion of registration. No person will be allowed to register on behalf of another person even with the original NRIC/ Passport of the other person.

3. Upon registration, you will be given a barcoded wristband, gift bag, voucher for breakfast box and lunch box redemption and AGM question form.

A shareholder or a proxy-holder is only entitled for one (1) gift bag, one (1) breakfast voucher and one (1) lunch voucher each. In the event that a shareholder is also an appointed proxy/ proxies; or if there is any subsequent appointment(s) to an already appointed proxy, he/ she will be entitled for another one (1) gift bag, one (1) breakfast voucher and one (1) lunch voucher only. Henceforth, any one (1) shareholder/ proxy may be entitled to a maximum of two (2) gift bags, two (2) breakfast vouchers and two (2) lunch vouchers.

4. Please fill up the AGM question form if you have any question to ask in the Twentieth AGM and submit the completed form at the Help Desk counter located at Level 2 before 10.00 a.m. or alternatively, you could ask the question during the AGM.

5. Only those with barcoded wristband will be allowed to enter the meeting hall. If you are attending as shareholder as well as proxy, you will only be given one identification barcoded wristband.

6. To place your votes, please produce your barcoded wristband at the designated e-voting stations in the meeting hall.

7. Should you have any queries or are unable to register, please proceed to the Help Desk counter for clarifications.

PARKING

Parking is complimentary at Top Glove Tower ONLY. Please produce your parking ticket for validation at the Help Desk counter.

BREAKFAST BOX AND LUNCH BOX REDEMPTION

Breakfast box may be redeemed upon registration at Level 2 and lunch box may be redeemed upon the conclusion of voting by shareholders and proxies at the foyer at Level 9.

HELP DESK

Please proceed to Help Desk for the following matters:1. Parking ticket validation;2. Registration of Corporate Member; 3. Any revocation of Proxy’s Appointment or any clarifications or queries or feedbacks; and4. Submission of AGM question form.

ADMINISTRATIVE DETAILS FOR THE 20TH AGM


(CONT’D)ADMINISTRATIVE DETAILS FOR THE 20TH AGM

GENERAL MEETING RECORD OF DEPOSITORS

Members whose names appear in the Record of Depositors as at 31 December 2018 shall be entitled to attend, speak and vote at the Twentieth AGM or appoint proxies to attend, speak and vote on members’ behalf.

VOTING PROCEDURE

The voting at the AGM will be conducted by poll. Poll Administrator and Independent Scrutineers will be appointed to conduct the polling process and verify the results of the poll, respectively. Poll voting for each of the resolution will be conducted upon the conclusion of the deliberations of all the businesses indicated in the Notice of the Twentieth AGM. The registration for attendance will be closed to facilitate the commencement of the poll voting.

PROXY

1. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint not more than two (2) proxies, to attend and vote on his/ her behalf. If you are unable to attend the Meeting and wish to appoint a proxy to vote on your behalf, please submit your Form of Proxy in accordance with the notes and instructions printed therein.

2. If you wish to attend the Meeting yourself, please do not submit any Form of Proxy for the Meeting that you wish to attend. You will not be allowed to attend the Meeting together with a proxy appointed by you.

3. If you have submitted your Form of Proxy prior to the Meeting and subsequently decided to attend the Meeting yourself, please proceed to the Help Desk to revoke the appointment of your proxy.

4. Please also ensure that the original Form of Proxy is deposited at the office of the Share Registrar, Securities Services (Holdings) Sdn. Bhd. at Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Wilayah Persekutuan, Malaysia not less than forty-eight (48) hours before the time appointed for holding the Meeting or at any adjournment thereof.

ENQUIRY

Please email to [email protected], if you have any queries in relation to the AGM, Form of Proxy, Administrative Details of the Meeting and the 2018 Annual Report. This email account was created for AGM enquiries and will only be valid from Wednesday, 14 November 2018 to Thursday, 10 January 2019.

Alternatively, you may contact our Share Registrar at Tel: +603-2084 9000, during office hours:1. Mr. Wong Piang Yoong ([email protected])2. Encik Mohd Hisham Hashim ([email protected])3. Puan Nurhayati Ang ([email protected])

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Top Glove Tower16, Persiaran Setia DagangSetia Alam, Seksyen U1340170 Shah Alam, Selangor D.E.Malaysia

Tel: +603-3362 3098Fax: +603-3362 3860

1) Search “Top Glove Tower” in Waze

2) GPS Coordinate: 3.107902, 101.458943


Notes:1.Inrespectofdepositedsecurities,onlymemberswhosenames

appear in the Record of Depositors on 31 December 2018(GeneralMeetingRecordofDepositors)shallbeeligibletoattendtheMeeting.

2.Amember of theCompany entitled to attend and vote at theMeeting isentitledtoappointnotmorethantwo(2)proxiestoattend and vote in his stead.Aproxymaybut need not be amemberoftheCompanyandamembermayappointanypersontobehisproxy.Thereshallbenorestrictionastothequalificationoftheproxy.AproxyappointedtoattendandvoteattheMeetingshallhavethesamerightsasthemembertospeakattheMeeting.

3.Where a holder appoints more than one (1) proxy, theappointmentshallbeinvalidunlesshespecifiestheproportionofhisshareholdingstoberepresentedbyeachproxy.

4.Theinstrumentappointingaproxyshallbeinwritingunderthehandoftheappointororofhisattorneydulyauthorisedinwritingor,iftheappointorisacorporation,eitherunderitssealorunderthehandofanofficerorattorneydulyauthorised.

5.Where a member of the Company is an exempt authorisednominee which holds ordinary shares in the Company formultiplebeneficialownersinone(1)securitiesaccount(“omnibusaccount”), there isno limit to thenumberofproxieswhichtheexempt authorised nominee may appoint in respect of eachomnibusaccountitholds.

6.TheinstrumentappointingaproxymustbedepositedattheofficeoftheShareRegistrar,SecuritiesServices(Holdings)Sdn.Bhd.at Level 7, Menara Milenium, Jalan Damanlela, Pusat BandarDamansara,DamansaraHeights,50490KualaLumpur,WilayahPersekutuan,Malaysianotlessthanforty-eight(48)hoursbeforethetimeappointedforholdingtheMeetingoratanyadjournmentthereof.

*I/WeNRIC/Passport/Company No.: Tel:CDS Account No.: Number of Shares Held: Address:

being a member of TOP GLOVE CORPORATION BHD (474423-X) hereby appoint:1) Name of Proxy: NRIC/Passport No.: Address: Tel: Percentage of Shares Represented: %2) Name of Proxy: NRIC/Passport No.: Address: Tel: Percentage of Shares Represented: %

or failing him/her, the CHAIRMAN OF THE MEETING, as my/our proxy to attend and vote for me/us, and on my/our behalf at the Twentieth Annual General Meeting of the Company to be held at TG Grand Ballroom 1, Level 9, Top Glove Tower of 16, Persiaran Setia Dagang, Setia Alam, Seksyen U13, 40170 Shah Alam, Selangor Darul Ehsan, Malaysia on Tuesday, 8 January 2019 at 10:30 a.m. and at any adjournment thereof.

Please indicate with “X” how you wish your vote to be casted. In the absence of specific instruction, your Proxy will vote or abstain from voting at his/her discretion.

No. Resolutions For AgainstORDINARY BUSINESS

1 To approve the declaration of the Single Tier Final Dividend of 5.0 sen per share.2 To re-elect the Director, Dato’ Lee Kim Meow.3 To re-elect the Director, Puan Sri Tong Siew Bee.4 To re-elect the Director, Mr. Lim Hooi Sin.5 To approve the payment of Directors’ Fees.6 To approve the payment of Directors’ Benefits (excluding Directors’ Fees).7 To re-appoint Messrs. Ernst & Young as Auditors of the Company.

SPECIAL BUSINESS8 Authority to Issue Shares Pursuant to the Companies Act 2016.9 Proposed Renewal of Share Buy-Back Authority.10 Proposed Allocation of Awards to Ang Eng Li Andrea.11 Proposed Allocation of Options to Ang Eng Li Andrea.12 Proposed Adoption of New Constitution.

Signed on this day of 2018/2019

Signature of Member/Common Seal

FORM OF PROXY

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The Share RegistrarTOP GLOVE CORPORATION BHD (474423-X)c/o: Securities Services (Holdings) Sdn. Bhd.Level 7, Menara MileniumJalan Damanlela, Pusat Bandar DamansaraDamansara Heights50490 Kuala Lumpur, Malaysia

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MEDIA HIGHLIGHTS


U.S.A. MARKETING OFFICETG Medical (U.S.A.) Inc., 155, North Aspan Avenue,Azusa CA 91702 U.S.A.Tel : +1-626-969-8808Fax : +1-626-969-7823E-mails : [email protected]

GERMANY SALES OFFICE 1Top Glove Europe GmbH,Bliersheimer Str. 80 A,47229 Duisburg,North Rhine-Westphalia, Germany.Tel : +49 (0) 2065 76421 0Fax : +49 (0) 2065 76421 19E-mail : [email protected]

GERMANY SALES OFFICE 2ulma International GmbH,Pfaffenweg 35,89231 Neu-Ulm, Germany.Tel : +49-731-926043-15Fax : +49-731-926043-10E-mail : [email protected]

BRAZIL MARKETING OFFICEKevenoll Do Brasil Produtos Medicos Hospitalares Ltda.Rodovia Antonio Heil, 1001, KM 01Complemento 203Itaipava, Itajai SC Cep 88316-001Brasil.Tel : +5547 3349-6168E-mail : [email protected]

FACTORY 2Lot 4968, Jalan Teratai, Batu 6,Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3392 1992/1905

FACTORY 3Lot 5091, Jalan Teratai, Batu 5,Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia.Tel : +603-3392 7880/7350Fax : +603-3392 9160

FACTORY 4Lot 5987, Jalan Teratai, Batu 5,Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3392 8588/8996Fax : +603-3392 6788

FACTORY 5 & 5BLot 18, 27, 38 & 57, Medan Tasek, Kawasan Perindustrian Tasek,31400 Ipoh, Perak D.R., Malaysia.Tel : +605-546 6360/547 9271Fax : +605-547 8975

FACTORY 6180/3, Moo 7, Srisoontorn Road, Tambon Srisoontorn, Amphur Thalang, Phuket 83110, Thailand.Tel : +66-76-620 190-4Fax : +66-76-620 196

FACTORY 7188, Moo 5, Karnchanawanich Road, Tambol Samnakkham, Amphur Sadao, Songkhla 90320 Thailand.Tel : +66-74-410-000Fax : +66-74-410 007/008

FACTORY 10Lot 4970, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3392 9288/ 9942/3320Fax : +603-3392 8984

FACTORY 11Lot 4967, Jalan Teratai, Batu 6,Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3392 1899/5399

FACTORY 12Lot 4960, Jalan Teratai, Batu 6,Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3392 3375Fax : +603-3392 5200

FACTORY 13Lot 4947, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3393 1288Fax : +603-3393 1993

FACTORY 13PLot 4946, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3885 3141Fax : +603-3393 1993

FACTORY 14Lot 5104, Jalan Teratai, Batu 5, Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3392 3626

FACTORY 15No. 4 Weiwu Road,Economic Development District, Xinghua City, 225700 Jiang Su Province, P. R. China.Tel : +86-523-8326 8976Fax : +86-523-8326 8676

FACTORY 16L188, Moo 5, Tambol Pangla,Amphur Sadao,Songkhla 90170 Thailand.Tel : +66-74-410 888Fax : +66-74-410 886

FACTORY 17L268, Moo 5, Tambol Kampangphet, Amphur Rattaphum,Songkhla 90180 Thailand.Tel : +66-74-302888Fax : +66-74-302889/302890

FACTORY 18B & 18GLot 124 & 126, Jalan Lapan,Kompleks Perabot Olak Lempit, 13 KM, Jalan Banting Dengkil, 42700 Banting,Selangor D.E., Malaysia.Tel : +603-3149 1998Fax : +603-3149 3008

FACTORY 19Lot 4987, Jalan Bunga Raya, Batu 6, Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3392 5900Fax : +603-3392 5910

FACTORY 19BF Lot 4987, Jalan Bunga Raya, Batu 6,Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-7890 3319

FACTORY 20 & 20BCLot 4988, Jalan Bunga Raya, Batu 6,Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3392 4211Fax : +603-3392 4200

FACTORY 21Lot 4989, Jalan Dahlia/KU8, Kawasan Perindustrian Meru Timur, 41050 Klang, Selangor D.E., Malaysia.Tel : +603-3392 4614/4642Fax : +603-3392 5068

FACTORY 22Lot 4990, Jalan Bunga Raya, Batu 6, Off Jalan Meru, 41050 Klang,Selangor D.E., Malaysia.Tel : +603-3392 1187/ +603-7890 3322Fax : +603-3392 1186

FACTORY 23Lot 12, Medan Tasek,Kawasan Perindustrian Tasek,31400 Ipoh, Perak D.R., Malaysia.Tel : +605-545 5032Fax : +605-547 8975


CORPORATE DIRECTORY

CORPORATE OFFICE, SETIA ALAMAddress : Level 21, Top Glove Tower, 16,

Persiaran Setia Dagang, Setia Alam,Seksyen U13, 40170 Shah Alam, Selangor D.E., Malaysia.

Tel : +603-3362 3098Fax : +603-3362 3860E-mails : (i) [email protected]

(ii) [email protected](iii) [email protected]

Website : www.topglove.com

FACTORY 24Lot 4986, Jalan Dahlia/KU8,Kawasan Perindustrian Meru Timur, 41050 Klang, Selangor D.E., Malaysia.Tel : +603-3392 6010/0975Fax : +603-3392 0289

FACTORY 25PT 64593, Jalan Dahlia/KU8,Kawasan Perindustrian Meru Timur, 41050 Klang, Selangor D.E., Malaysia.Tel : +603-3392 6317Fax : +603-3392 6348

FACTORY 26Lot 4961, Jalan Teratai, Batu 6,Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia.Tel : +603-3392 3375Fax : +603-3392 5200

FACTORY 27Lot 2431 Mukim Port Dickson, Sendayan, 71100 Siliau,Negeri Sembilan D.K., Malaysia.Tel : +606-651 4966/2043Fax : +606-651 6896

FACTORY 29Lot 4985, Jalan Dahlia/KU8,Kawasan Perindustrian Meru Timur, 41050 Klang, Selangor D.E., Malaysia.Tel : +603-3392 6010

FACTORY 30 Lot 4983 & 4984, Jalan Dahlia, Kawasan Perindustrian Meru Timur, 41050 Klang, Selangor D.E., Malaysia.Tel : +603-7890 3330Fax : +603-3392 5066

FACTORY 31Lot 6472, Lorong Sungai Puloh/KU06, Kawasan Perindustrian Sungai Puloh,42100 Klang, Selangor D.E., Malaysia.Tel : +603-7890 3331

FACTORY 33Lot 3726, Kawasan Perindustrian Nilai,Mukim Setul Daerah Seremban,71800 Nilai, Negeri Sembilan D.K., Malaysia.Tel : +603-7890 3333

FACTORY 34PMLot 5, Jalan Paku 16/6, 40000 Shah Alam, Selangor D.E., Malaysia.Tel : +603-5519 1576Fax : +603-5510 0072

FACTORY 35CDLot 5090, Jalan Teratai, Batu 5,Off Jalan Meru, 41050 Klang, Selangor D.E., MalaysiaTel : +603-3392 7880

FACTORY OFFICE, KLANG (FACTORY 9)Address : Lot 4969, Jalan Teratai, Batu 6,

Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia.

Tel : +603-3392 1992/1905Fax : +603-3392 8410

FACTORY 362, Jalan 8, Pengkalan Chepa 2 Industrial Zone, 16100 Kota Bharu, Kelantan D.N., Malaysia.Tel : +609 774 7171Fax : +609 771 3565/3072

FACTORY 37PLO 5, Jalan Mahsuri 1,7.5 Km, Jalan Mersing86007 Kluang, Johor D.T., Malaysia.Tel : +607 787 9731 Fax : +607 787 9733

FACTORY 381, Jalan Hi-Tech 12,Zon Industri Fasa 3,Kulim Hi-Tech Park, 09090 Kulim,Kedah D.I., Malaysia.Tel : +604 401 9888Fax : +609 771 3565

FACTORY 39DDNo. 36, Jalan Meru Indah 20,Taman Perindustrian Meru,Off Persiaran Hamzah Alang,42200 Klang, Selangor, Malaysia.Tel : +603-3392 3375Fax : +603-3392 5200

TOP GLOVE CORPORATION BHD ANNUAL REPORT 2018TOP GLOVE CORPORATION BHD ANNUAL REPORT 2018 217

ANNUALREPORT

FINANCIAL YEAR ENDED 2018

31 AUGUST 2018

Exports to 195 Countries Worldwide

MALAYSIA

Asia

Africa

Oceania

LatinAmerica

EuropeNorthAmerica

40FACTORIES

648PRODUCTION

LINES

OVER

17,000EMPLOYEES

60.5BILLION

GLOVES PERANNUM

Level 21, Top Glove Tower, 16, Persiaran Setia Dagang, Setia Alam, Seksyen U13,40170 Shah Alam, Selangor D.E., Malaysia.

Tel : +603-3362 3098 Fax : +603-3362 3860 Mobile : +6012-2896 270E-mail : [email protected] / [email protected] / [email protected]

Documents

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