Komarkcorp Berhad Lot 132, Jalan 16/1, Kawasan Perindustrian … Komarkcorp Berhad (374265-A) Lot...

Komarkcorp Berhad (374265-A)

Lot 132, Jalan 16/1, Kawasan Perindustrian Cheras Jaya43200 Balakong, Selangor Darul Ehsan, Malaysia

Tel: 603 9080 3333Fax: 603 9080 5233

Email: [email protected]: www.komark.com.my

CONTENTSCorporate Information 2

Corporate Structure 3

Chairman’s Statement 4

Product Review 6

Distribution Network 8

Five-Years Group Financial Highlights 9

Notice of Annual General Meeting 10

Appendix 1 14

Profile of Directors of Komarkcorp Berhad 15

Statement on Corporate Governance 19

Statement on Internal Control 28

Audit Committee Report 29

Other Information 33

Financial Statements 35

Analysis of Shareholdings 82

List of Properties 85

Proxy Form

CORPORATEINFORMATION

Koh Hong Muan @ Koh Gak Siong(Group Chairman/Chief Executive Officer)

Koh Chie Jooi(Managing Director)

Koh Chee Mian(Deputy Managing Director)

Koh Chee Kian(Executive Director)

Koh Chee Hao(Executive Director)

Datuk Ng Peng Hong @ Ng Peng Hay (Independent Non-Executive Director)

Chew Chee Chek (Independent Non-Executive Director)

Ihsan bin Ismail(Independent Non-Executive Director)

Management Team

Ong Ann Boon(Director)

General Labels & Labelling Pte. Ltd.

Chong Jiun Shyang(Group Financial Controller)

Dr. Victor Chong Yoon Soon(Group Deputy General Manager

- QAQC &System)

Leonard Tan Chee Leong(Deputy General Manager)

Tan Kay Yee(Assistant General Manager)

Simon Yam Kok Mun(Production Manager)

General Labels & Labelling (M) Sdn BhdKomark International (M) Sdn Bhd

Registered Office

Lot 6.05, Level 6, KPMG Tower8 First Avenue, Bandar Utama47800 Petaling JayaSelangor Darul EhsanTel : 03-7720 1188Fax : 03-7720 1111

Principal Place Of Business

(Headquarters)Lot 132, Jalan 16/1Kawasan Perindustrian Cheras Jaya43200 BalakongSelangor Darul EhsanTel : 03-9080 3333Fax : 03-9080 5233

Audit Committee

Datuk Ng Peng Hong @ Ng Peng HayChairman(Independent Non-Executive Director)

Chew Chee ChekMember of the Committee(Independent Non-Executive Director)

Ihsan bin IsmailMember of the Committee(Independent Non-Executive Director)

Remuneration Committee



Koh Hong Muan @ Koh Gak SiongMember of the Committee(Executive Director)

Nomination Committee



Koh Hong Muan @ Koh Gak SiongMember of the Committee(Executive Director)

Auditors

Ong & Wong (AF 0241)

Chartered AccountantsUnit C-20-5, Block C20th Floor Megan Avenue II12, Jalan Yap Kwan Seng50450 Kuala Lumpur

Registrars

Tricor Investor Services Sdn Bhd(Company No. 118401-V)

Level 17, The Gardens North TowerMid Valley CityLingkaran Syed Putra59200 Kuala LumpurTel : 03-2264 3883Fax : 03-2282 1886

Principal Bankers

Hong Leong Bank Bhd(Co No. 97141-X)

Bank of Shanghai Co.LtdMalayan Banking Berhad(Co No. 3813-K)

HSBC Bank Malaysia Bhd(Co No.127776-V)

Kuwait Finance House (Malaysia) Bhd(Co no.672174-T)

Company Secretaries

Liew Irene (MAICSA 7022609)Tai Yit Chan (MAICSA 7009143)

Stock Exchange Listing

Bursa Malaysia Securities Berhad(Co No. 635998-W)

Main Market

DIRECTORS

Komarkcorp Berhad (374265-A)2

CORPORATESTRUCTURE

GENERAL LABELS& LABELLING (M) SDN. BHD.(93225-V)

GENERAL LABELS & LABELLING(PENANG) SDN. BHD. (146231-W)

GENERAL LABELS & LABELLINGPTE. LTD. (198300123C)

GENERAL LABELS & LABELLING(IPOH) SDN. BHD. (458045-W)

KOMARK (THAILAND)CO. LTD. (1554/2358)

GENERAL LABELS &LABELLING (JB) SDN. BHD.(480867-X)

PT KOMARK LABELSAND LABELLINGINDONESIA

KOMARK ENTERPRISECO. LTD. (5053)

SHANGHAI KOMARKLABELS & LABELLINGCO. LTD. (020411)

GUANGZHOU KOMARKLABELS & LABELLINGCO. LTD. (100286)

KOMARK HONG KONGCO. LTD. (754596)

100%

100%

49%

70%100%

100%

8.4%

100%

50%

100%

KOMARK INTERNATIONAL(M) SDN. BHD. (96626-V)

KOMARK AUSTRALASIAPTY. LTD. (087852793)

KOMARK INVESTMENTHOLDINGS LTD. (440077)

KOMARK CHINA LTD.*(CR-109965)

100%

100%

100%

100%

* In the midst of striking off

50%

99%

91.6%

30%

1%

3annual report 2012

PERFORMANCE REVIEW

The global economy continues with its trend of uncertainty due to the sovereign debt levels particularly in Europe, a flat Gross Domestic Product (“GDP”) outlook in advanced economic markets and an expected slowdown in emerging markets. This combination of factors has given rise to yet another year of global economic slowdown.

The FYE 2012 presented yet another challenging year for the Group. The Group recorded an increase of 9.19% in revenue amounted to RM123.346 million compared to RM112.968 million recorded in preceding financial year. The Multinational Customers continued to contribute substantially to the Group’s turnover.

Despite increase in revenue, the Group recorded lower profit before taxation (“PBT”) of RM0.830 million and profit after taxation (“PAT”) of RM0.079 million compared to RM2.9 million and RM2.115 million respectively recorded in the preceding financial year. This is mainly attributable to higher raw material prices and higher operating cost.

MARKET OUTLOOK

The Malaysia economy is expected to register a GDP growth of 4% to 5% compared to 5.1% achieved in 2011.

The East Asia’s GDP growth is forecasted to decelerate from 8% of 2011 to 7.4% in 2012. This is mainly due to:

• Thecontinueduncertaintyineurozone;• Afurtherslumpinglobaltrade;and• AnanaemicrecoveryintheUnitedStates.

Though the East Asia economic situation is an unpleasant one, this region has the highest GDP growth in the world. As the Group has diversified its markets in different countries (mainly Malaysia, China, Singapore, Thailand, Indonesia, India and Philippines), the impact of economic slowdown shall be mitigated. The prospect of the Group’s operations in China is extremely bright given their population of approximately 1.3 billion and their projected GDP growth of 8.5% for 2012 would create huge demand for labels and related products. We will continue to capitalizeontheGroup’sestablishedbrandname,productquality,efficientserviceand wide network to strengthen its market position locally and abroad. In addition, the Group will continue to explore potential foreign markets for its products. The Group expects the performance and market outlook of Asia Pacific region in the coming years to be more challenging.

Dear Shareholders,

With great pleasure and on behalf of the Board of Directors, I present to you the Annual Report of Komarkcorp Berhad and its subsidiary companies (“Group”) for the financial year ended 30 April 2012 (“Financial Year 2012” or “FYE 2012”).

CHAIRMAN’SSTATEMENT


CHAIRMAN’SSTATEMENT

DIVIDEND

The immediate priority for the Group is to reduce its bank borrowings, which arises frompastbusinessexpansionand thus; the internallygenerated fundwouldbechanneled towards the repayment of bank borrowings. After taking into consideration of the above, the Board of Directors is not recommending any dividend payment for the financial year ended 30 April 2012.

ACKNOWLEDGEMENTS

On behalf of the Board of Directors, I wish to express our sincere appreciation to the Management and staff of the Group for their continued dedication, commitment and loyalty to the Group. I also wish to express our sincere appreciation to our valued shareholders, customers, business associates, government authorities and bankers for their continued support and cooperation.

Koh Hong Muan @ Koh Gak SiongGroup Chairman

5annual report 2012

PRODUCTREVIEW

Pressure Sensitive LabelsIn Reel / Sheet

Multiform (Booklet) Labels

Heat Shrink Sleeves

Barcode & Computer Labels

PP Roll-Fed Labels

In-Mould Labels

RFID Smart Labels

Fabric Labels

PACKAGING SOLUTION

PUMA SERIES TIGER SERIES LION SERIES K3000 SERIES

Four Label Applicator Heads

for 2 Sides & Non-Stop Labelling With Stepper MotorDrive System

Pressure Sensitive LabelApplicator

With Servo Motor Drive System Double Side Labelling

(Tiger Series)

Pressure Sensitive Label Applicator

With Fully Synchronised StepperMotor Drive System - 2 Sides Labelling

With Wraparound Station (Lion Series)

Pressure Sensitive Label Applicator

With Clutch And Brake Drive System - Wraparound

Labelling

Pressure Sensitive LabelHigh Speed Rotary Labelling

Machine

Pressure Sensitive LabelApplicator

For Tube Labelling

Fully CustomisationLabelling System

For Pharmaceuticals Industry

Semi Automatic Labelling Machine

Pressure Sensitive LabelDispenser

Automatic Label Dispenser With Hot Printer

High Speed LabelsInspection Machine

(LIM380)

Pressure Sensitive Labels Inspection Machine

(PIM300S)

LABELLING & LABELS SOLUTION


PRODUCTREVIEW

Pricing Labeller - Single Liner

Digital ComputingScale

Scale Labels, PricingLabels & Tag

Axon Automatic Heat Shrink Band and Sleeve Applicator & Heat Tunnel

Cocito Pressure Sensitive Label Rotary High Speed

Labelling Machine

Pricing Labeller - Three Liner

Barcode Labels Printer cumApplicator

Labels Rewinder for Pricing Labels

With or Without Slitter

Cocito RotaryLabelling Machine

“Etina” for Roll-Fed Label

Styrotech PEStretch Sleeve

Label Applicator

Pricing Labeller - Double Liner

BarcodeScanner / Printer

Rotary Press (1 - 2 Colours)

Komark Automatic Heat Shrink Band and Sleeve

Applicator and Heat Tunnel

Cocito RotaryCold Glue / Hot

Mett Labelling Machine

Tag Guns & Pins

Barcoding SystemSoftware

Mini Slitter for Labels

RETAILING & BARCODING SYSTEM SOLUTION

OEM & AGENCY PRODUCTS

7annual report 2012

DISTRIBUTIONNETWORK

MALAYSIA HEADQUATERS

KUALA LUMPUR

Penang

Shanghai

Singapore

Ipoh

Langfang

Thailand

Johor Bahru

GuangZhou

Indonesia


FIVE-YEARS GROUP FINANCIAL HIGHLIGHTSYEAR ENDED 30 APRIL

2012 2011 2010 2009 2008

Operating Result (RM’000)

Revenue 123,346 112,968 111,998 117,757 116,086

Profit Before Tax 830 2,900 2,900 875 2,649

Profit After Tax 79 2,115 2,020 347 1,667

Key Balance Sheet Data (RM’000)

Total Assets 214,793 217,314 221,369 244,380 236,378

Total Interest Bearing Borrowings 66,019 75,710 82,856 90,379 92,631

Total Liabilities 94,891 99,003 104,904 126,870 121,540

Paid-Up Capital 81,275 81,275 81,275 81,275 81,275

ShareholdersEquity 119,902 118,311 116,465 117,510 114,838

Per Share (sen)

Basic EPS 0.10 2.65 2.53 0.44 2.10

Gross Dividend 0.00 0.00 0.00 0.00 0.00

Net Assets 147.53 145.57 143.30 144.58 141.30

Financial Ratio (%)

ReturnonEquity 0.07 1.79 1.73 0.30 1.45

Return on Total Assets 0.04 0.97 0.91 0.14 0.71

Gearing ratio 79.14 83.68 90.07 107.97 105.84

Revenue(RM’000)

Profit Before Tax(RM’000)

Profit After Tax(RM’000)

2008

2008

2008

2009

2009

2009

2010

2010

2010

2011

2011

2011

2012

2012

2012

100,000 500 100

105,000 1,000 500

110,000 1,500 1,000

115,000 2,000 1,500

120,000 2,500 2,000

125,000 3,000 2,500

9annual report 2012

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN THAT the Sixteenth Annual General Meeting of the Company will be convened and held at Langkawi Room, Bukit Jalil Golf & Country Resort, Jalan 3/155B, Bukit Jalil, 57000 Kuala Lumpur on Monday, 29 October 2012 at 10.00 a.m. to transact the following businesses:-

AGENDAAs Ordinary Business

1. To receive and adopt the Audited Financial Statements for the financial year ended 30 April 2012 together with the Directors’ and Auditors’ Reports thereon.

2. To approve the Directors’ Fees for the financial year ended 30 April 2012.

3. To re-elect the following Directors who are retiring under Article 93.1 of the Articles of Association of the Company:-

(i) Mr Koh Hong Muan @ Koh Gak Siong (ii) Datuk Ng Peng Hong @ Ng Peng Hay (iii) Encik Ihsan bin Ismail

4. To re-appoint Messrs Ong & Wong as Auditors of the Company and to authorise the Directors to fix their remuneration.

As Special Business

To consider and, if thought fit, to pass the following resolutions:-

5. Proposed Renewal of Share Buy-Back Mandate

THAT, subject to the Companies Act, 1965 (“Act”), the Articles of Association of the Company,MainMarketListingRequirements (“MMLR”)ofBursaMalaysiaSecuritiesBerhad (“Bursa Securities”) and any other relevant authorities, the Company be and is hereby authorised to purchase such number of ordinary shares of RM1.00 each in the Company (“Shares”) (“Proposed Share Buy-Back”) as may be determined by the Directors of the Company from time to time through Bursa Securities upon such terms and conditions as the Directors may deem fit in the interest of the Company provided that the aggregate number of Shares purchased pursuant to this resolution does not exceed ten percent (10%) of the total issued and paid-up share capital of the Company and that an amount not exceeding the Company’s share premium account of RM15.3 million as at 30 April 2012, would be allocated by the Company for the Proposed Share Buy-Back. The unaudited share premium account of the Company as at 31 July 2012 was RM15.3 million.

THAT the authority conferred by this resolution will commence immediately upon the

passing of this resolution and will continue to be in force until:-

(i) the conclusion of the next Annual General Meeting (“AGM”) of the Company following the Sixteenth AGM at which this ordinary resolution was passed at which time it will lapse unless by ordinary resolution passed at that meeting, the authority isrenewed,eitherunconditionallyorsubjecttoconditions;

(ii) theexpirationoftheperiodwithinwhichthenextAGMafterthatdateisrequiredbylawtobeheld;or

(iii) revoked or varied by ordinary resolution passed by the shareholders of the Company in general meeting,

whichever occurs first.

Ordinary Resolution 1




Ordinary Resolution 4Ordinary Resolution 5


NOTICE OF ANNUAL GENERAL MEETING (CONT’D)

THAT the Directors be and are hereby authorised to take all steps necessary to implement, finalise and to give full effect to the Proposed Share Buy-Back and further THAT authority be and is hereby given to the Directors to decide in their absolute discretion to either retain the SharespurchasedbytheCompanyastreasuryshares,tobeeithersubsequentlycancelledor distributed as share dividends and/or re-sold on Bursa Securities, or to cancel the Shares so purchased or a combination of both.

6. Proposed Renewal of General Mandate for Recurrent Related Party Transactions

THAT the proposed renewal of general mandate pursuant to Paragraph 10.09 of the MMLR of Bursa Securities, authorising the subsidiaries of the Company to enter into recurrent transactions of a revenue or trading nature as set out in paragraph 3.2.1 of the Circular to Shareholders dated 5 October 2012 with the related party mentioned therein which are necessary for the Komarkcorp group’s day-to-day operations (“Proposed Renewal of General Mandate for Recurrent Related Party Transactions”), be and is hereby approved provided that:-

(i) the transactions are in the ordinary course of business and on normal commercial terms which are not more favourable to the related parties than those generally available to the public and are not to the detriment of the minority shareholders of theCompany;and

(ii) in making the disclosure of the aggregate value of recurrent transactions conducted pursuant to the general mandate in the Annual Report, the Company will provide a breakdown of the aggregate value of the recurrent transactions and type of recurrent transaction made during the financial year.

THAT the authority conferred by such mandate shall continue to be in force until:-

(i) the conclusion of the next AGM of the Company following the Sixteenth AGM at which the Proposed Renewal of General Mandate for Recurrent Related Party Transactions is approved, at which time it will lapse, unless by a resolution passed attheAGM,themandateisagainrenewed;

(ii) the expiration of the period within which the next AGM of the Company after the SixteenthAGMisrequiredtobeheldpursuanttoSection143(1)oftheCompaniesAct, 1965 (but shall not extend to such extensions as may be allowed pursuant to Section143(2)oftheCompaniesAct,1965);or

(iii) revoked or varied by a resolution passed by the shareholders in general meeting,

whichever is earlier.

AND THAT the Directors of the Company be and are hereby authorised to complete and do all such acts and things as they may consider expedient or necessary to give effect to the Proposed Renewal of General Mandate for Recurrent Related Party Transactions.



11annual report 2012


7. Proposed Authority under Section 132D of the Companies Act, 1965 for the Directors to issue shares

THAT pursuant to Section 132D of the Companies Act, 1965, the Directors be and are hereby authorised to issue shares in the Company at any time until the conclusion of the next AGM 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 to be issued does not exceed ten percent (10%) of the issued share capital of the Company for the time being, subject always to the approval of all relevant regulatory bodies being obtained for such allotment and issue.

8. Proposed Amendments to the Articles of Association

THAT the deletions, alterations, modifications, variations and additions to the Articles of Association of the Company as set out in Appendix I attached with the Annual Report for the financial year ended 30 April 2012 be and are hereby approved.

BY ORDER OF THE BOARDLIEW IRENE (MAICSA 7022609)TAI YIT CHAN (MAICSA 7009143)Secretaries

Selangor Darul EhsanDate: 5 October 2012

NOTES

1. A member of the Company entitled to attend and vote at the meeting is entitled to appoint a proxy or proxies to attend and vote in his stead. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company.

2. A member may appoint not more than two (2) proxies to attend and vote at the same meeting. Where a member appoints two (2) proxies, the appointments shall be invalid unless he specifies the proportions of his shareholdings to be represented by each proxy.

3. Where a member of the Company is an exempt authorised nominee which holds shares in the Company for multiple beneficial owners in one securities account (“omnibus account”) as defined under the Securities Industry (Central Depositories) Act, 1991, there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

4. 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 Common Seal or under the hand of the attorney.

5. The instrument appointing a proxy, with the power of attorney or other authority (if any) under which it is signed or a notarially certified or office copy of such power or authority, must be deposited at the Company’s Share Registrars’ office at Level 17, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur not less than 48 hours before the time set for holding the meeting or any adjournment thereof.

Special Resolution




EXPLANATORY NOTES TO THE SPECIAL BUSINESS

6. Ordinary Resolution 7, if passed, will give the Directors of the Company authority to take all such steps as are necessary or expedient to implement, finalise, complete and/or to effect the purchase(s) of ordinary shares by the Company as the Directors may deem fit and expedient in the best interest of the Company. The authority will, unless revoked or varied by the Company in general meeting, continue to be in force until the conclusion of the next Annual General Meeting of the Company or the expiry of the period withinwhichthenextAnnualGeneralMeetingoftheCompanyfollowingtheSixteenthAnnualGeneralMeetingisrequiredbylawto be held.

7. Ordinary Resolution 8, if passed, will allow Komarkcorp Group to enter into recurrent related party transactions in the ordinary

course of business and the necessity to convene separate general meetings from time to time to seek shareholders’ approval as and when such recurrent related party transactions occur would not arise. This would reduce the expenses associated therewith, improve administrative efficiency and allow human resources and time to be channelled towards attaining corporate objectives. The shareholders’ mandate is subject to renewal on an annual basis.

8. The Company had, during its Fifteenth AGM held on 28 October 2011, obtained its shareholders’ approval for the general mandate for issuance of shares pursuant to Section 132D of the Companies Act, 1965 (“the Act”). The Company did not issue any shares pursuant to this mandate obtained.

The Ordinary Resolution 9 proposed under item 7 of the Agenda is a renewal of the general mandate for issuance of shares by the Company under Section 132D of the Act. The mandate, if passed, will provide flexibility for the Company and empower the Directors to allot and issue new shares speedily in the Company up to an amount not exceeding in total 10% of the issued share capital of the Company (excluding treasury shares) for purpose of funding the working capital and future investment of the Group. This would eliminate any delay arising from and cost involved in convening a general meeting to obtain approval of the shareholders for such issuance of shares. This authority, unless revoked or varied by the Company at a general meeting, will expire at the next AGM.

9. The Special Resolution, if passed, will render the Articles of Association of the Company to be in line with the Main Market Listing RequirementsofBursaMalaysiaSecuritiesBerhadwhichtookeffecton3January2012andtoupdatetheArticlesofAssociationoftheCompanytobeconsistentwiththeprevailinglaws,guidelinesorrequirementsoftherelevantauthoritiesandtofurtherenhanceadministrative efficiency of the Company.


PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION

The Articles of Association of the Company are proposed to be amended in the following manner:

Article No.

Existing Articles Amended Articles

2.1 WORDS MEANINGS

New definition

New definition

WORDS MEANINGS

Exempt Authorised Nominee

Share Issuance Scheme

An authorised nominee defined under the Central Depositories Act which is exempted from compliance with the provisions of subsection 25A(1) of Central Depositories Act.

means a scheme involving a new issuance of shares to the employees.

4.4 every issue of shares or options to employees and/or Directors shall be approved by the members in general meeting and no Director shall participate in such an issue of shares or options unless the members in general meeting have approved of the specific allotment to be made to such Director.

every issue of shares or options to employees and/or Directors and any participation in share issuance scheme by Directors shall be approved by the members in general meeting and no Director shall participate in such an issue of shares or options unless the members in general meeting have approved of the specific allotment to be made to such Director.

61. In every notice calling a meeting of the Company, there shall appear with reasonable prominence a statement that a member entitled to attend and vote is entitled to appoint a proxy to attend and vote instead of him and that a proxy need not also be a member.

In every notice calling a meeting of the Company, there shall appear with reasonable prominence a statement that a member entitled to attend and vote is entitled to appoint a proxy to attend and vote instead of him and that a proxy need not be a member of the Company.

72.1 Provided that no poll shall be demanded on the election of a chairmanofameetingoronanyquestionofadjournment.

Any poll duly demanded on the election of a Chairman of a meeting or on any question of adjournment shall be taken forthwith at the meeting and without adjournment.

80.2 Subject to any special rights or restrictions as to voting attached to any class or classes of shares by or in accordance with these Articles, on a show of hands every person present who is a holder of ordinary shares or preference shares or a member’s representative or proxy or attorney and entitled to vote shall be entitled to one vote and in the case of a poll every member present in person or by proxy or by attorney or other duly authorised representative shall have one vote for every share held by him. A person entitled to more than one vote need not use all his votes or cast all the votes he uses on a poll in the same way. A member may appoint not more than two proxies to attend at the same meeting. Where a member appoints two proxies, he shall specify the proportion of his shareholdings to be represented by each proxy.

Subject to any special rights or restrictions as to voting attached to any class or classes of shares by or in accordance with these Articles, on a show of hands every person present who is a holder of ordinary shares or preference shares or member’s representative or proxy or attorney and entitled to vote shall be entitled to one vote on any question at any general meeting and in the case of a poll every member present in person or by proxy or by attorney or other duly authorised representative shall have one vote for every share held by him. A person entitled to more than one vote need not use all his votes or cast all the votes he uses on a poll in the same way. A member may appoint not more than two proxies to attend at the same meeting. Where a member appoints two proxies, the appointment shall be invalid unless he specifies the proportions of his shareholdings to be represented by each proxy and only one of those proxies is entitled to vote on a show of hands. A proxy appointed to attend and vote at a meeting shall have the same rights as the member to speak at the meeting.

86. The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing or, if the appointor is a corporation, either under the corporation’s seal or under the hand of an officer or attorney duly authorised. TheDirectorsmay,butshallnotbeboundtorequireevidenceof the authority of any such attorney or officer. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Act shall not apply to the Company. A member may appoint not more than two (2) proxies to attend and vote at the same meeting.

The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing or, if the appointor is a corporation, either under the corporation’s seal or under the hand of an officer or attorney duly authorised. TheDirectorsmay,butshallnotbeboundtorequireevidenceof the authority of any such attorney or officer. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Act shall not apply to the Company. A member may appoint not more than two (2) proxies to attend and vote at the same meeting. There shall be no restriction as to the qualification of the proxy.

87. Appointment of at least one proxy for authorised nominee company

Where a member of the Company is an authorised nominee as defined under the Central Depositories Act, it may appoint not more than two (2) proxies in respect of each Securities Account it holds with ordinary shares of the Company standing to the credit of the said Securities Account.

Appointment of multiple nominees

Where a member of the Company is an Exempt Authorised Nominee which holds ordinary shares in the Company for multiple beneficial owners in one securities account (“omnibus account”), there shall be no limit to the number of proxies which the Exempt Authorised Nominee may appoint in respect of each omnibus account it holds.

APPENDIX I


PROFILE OF DIRECTORSOF KOMARKCORP BERHAD

Koh Hong Muan @ Koh Gak Siong

Age : 64Nationality : MalaysianQualifications : Malaysian Certificate of EducationDirectorate : Executive DirectorDesignation : Group Chairman / Chief Executive DirectorOther Directorships of Public Companies : NoneThe Date He Was First Appointed to the Board : 16 June 1997

The details of any Board Committee to which he belongs : Remuneration Committee and Nomination Committee of Komarkcorp Berhad

Securities holding in the company :Direct : 6,010,300 ordinary sharesIndirect : 10,906,889 ordinary shares

Securities holding in the Subsidiaries :Deemed to have interests in shares of all the subsidiaries to the extent Komarkcorp Berhad has an interest.Family Relationship With Any Director and / or Major Shareholders of the Company : Parent to Mr Koh Chie Jooi, Mr. Koh Chee Mian, Mr Koh Chee Kian and Mr Koh Chee Hao.

Conflict of Interest : None

List of Convictions for Offences Within the Past 10 YearsOther Than Traffic Offences : None

Working Experience :

Mr. Koh Hong Muan @ Koh Gak Siong is the founder of the Komarkcorp Group of Companies and is currently the Group Chairman and Chief Executive Officer of Komarkcorp Group. He is responsible for formulating the overall business development and corporate strategies for the Group. Mr. Koh has been engaged in the manufacturing of pressure sensitive labels and automatic labelling systems for over 37 years during which he gained wide experience in product development and corporate management. He co-invented two sets of patented feeding mechanism in hand-held labellers and precision products feeding device with pneumatic logistic control systems in automatic labelling machines, respectively. Mr. Koh’s efforts were recognised by the Malaysian Government when General Labels & Labelling (M) Sdn Bhd and Komark International (M) Sdn Bhd, wholly-owned subsidiaries of Komarkcorp Berhad, were granted Pioneer Status for the manufacturing of automatic labelling machines and hand-held labellers by Malaysia Industrial Development Authority (MIDA), Malaysia in 1991 and 1997, repectively. Mr. Koh is a member of The Institute of Printing of the United Kingdom.

The Number of Board Meetings Attended in the Financial Year : 4 out of 4

Koh Chie Jooi

Age : 34Nationality : MalaysianQualifications : Degree in Bachelor of CommerceDirectorate : Executive DirectorDesignation : Managing Director Other Directorships of Public Companies : NoneThe Date He Was First Appointed to the Board : 27 June 2002

The details of any Board Committee to which he belongs : None

Securities holding in the company :Indirect : 16,917,189 ordinary shares

Securities holding in the Subsidiaries :Deemed to have interests in shares of all the subsidiaries to the extent Komarkcorp Berhad has an interest.Family Relationship With Any Director and / or Major Shareholders of the Company : Child of Mr Koh Hong Muan @ Koh Gak Siong and brother of Mr Koh Chee Mian, Mr Koh Chee Kian and Mr Koh Chee Hao.


List of Convictions for Offences Within the Past 10 Years Other Than Traffic Offences : None

Working Experience :

Mr. Koh Chie Jooi was appointed to the Board of Komarkcorp Berhad as an Executive Director on 27 June 2002. On 16 May 2011, he was appointed as Managing Director of the Komarkcorp Group. He graduated from the University of Sydney, Australia with a degree in Bachelor of Commerce. Prior to joining Komarkcorp in December 2001 as Assistant Accounts Manager, he was attached to KPMG from February 2001 to November 2001, with his last held position as Audit Assistant.

Mr Koh is currently assisting the Chairman / Chief Exec-utive Officer of Komark Group to oversee the overall opera-tion and financial matters and in formulating the busi-ness development and corporate strategies for the Group.



PROFILE OF DIRECTORS (CONT’D)OF KOMARKCORP BERHAD

Koh Chee MianAge : 32Nationality : MalaysianQualifications : Degree in Bachelor of EngineeringDirectorate : Executive DirectorDesignation : Deputy Managing Director Other Directorships of Public Companies : NoneThe Date He Was First Appointed to the Board : 15 December 2003

The details of any Board Committee to which hebelongs : None


Securities holding in the Subsidiaries :Deemed to have interests in shares of all the subsidiaries to the extent Komarkcorp Berhad has an interest.Family Relationship With Any Director and / or Major Shareholders of the Company : Child of Mr Koh Hong Muan @ Koh Gak Siong and brother of Mr Koh Chie Jooi, Mr Koh Chee Kian and Mr Koh Chee Hao.



Working Experience :Mr. Koh Chee Mian was appointed to the Board of Komarkcorp Berhad as an Executive Director on 15 December 2003. On 16 May 2011, he was appointed as Deputy Managing Director of Komarkcorp Group. He graduated from the King’s College London, United Kingdom with a degree in Bachelor of Engineering.

Currently, he is the person-in-charge of the overall operations for China.

The Number of Board Meetings Attended in theFinancial Year : 4 out of 4

Koh Chee KianAge : 29Nationality : MalaysianQualifications : Degree in Bachelor of Business, majoring in Finance and ITDirectorate : Executive DirectorDesignation : Head of Customer Service DivisionOther Directorships of Public Companies : NoneThe Date He Was First Appointed to the Board :16 May 2011

The details of any Board Committee to which hebelongs : None


Securities holding in the Subsidiaries :Deemed to have interests in shares of all the subsidiaries to the extent Komarkcorp Berhad has an interest.Family Relationship With Any Director and / or Major Shareholders of the Company :Child of Mr Koh Hong Muan @ Koh Gak Siong and brother of Mr Koh Chie Jooi, Mr Koh Chee Mian and Mr Koh Chee Hao.



Working Experience :Mr Koh Chee Kian is an Executive Director and was appointed to the Board of Komarkcorp Berhad on 16 May 2011. He graduated from the University of Technology, Sydney, Australia with a degree in Bachelor of Business, majoring in Finance and IT. He is currently pursuing the CPA Australia Professional Program. In 2006, he joined Komarkcorp Group as a production planner and has more than 5 years of experience in the Labels and Labelling Machine industry and about a year of experience in the Group’s Credit Control Department.

Currently, Mr Koh is in charge of the Customer Service DivisionintheGroup’sHeadquarterinMalaysia.




Koh Chee HaoAge : 26Nationality : MalaysianQualifications : Degree in Electrical Engineering.Directorate : Executive DirectorDesignation : Head of Machine Manufacturing DivisionOther Directorships of Public Companies : NoneThe Date He Was First Appointed to the Board : 16 May 2011

The details of any Board Committee to which he belongs : None


Securities holding in the Subsidiaries :Deemed to have interests in shares of all the subsidiaries to the extent Komarkcorp Berhad has an interest.Family Relationship With Any Director and / or Major Shareholders of the Company :Child of Mr Koh Hong Muan @ Koh Gak Siong and brotherof Mr Koh Chie Jooi, Mr Koh Chee Mian and Mr Koh CheeKian.



Working Experience :Mr Koh Chee Hao is an Executive Director and was appointed to the Board of Komarkcorp Berhad on 16 May 2011. He graduated from the Purdue University, United States with a degree in Electrical Engineering. He began his career as the Machine Manufacturing Division Manager of Komarkcorp Group and has 2 years experience in the Labels and Labelling Machine industry.

Currently, Mr Koh is in charge of the overall Research & Development and Machine Manufacturing Divisions in the Group’sheadquarterinMalaysiaandShanghai,China.


Datuk Ng Peng Hong @ Ng Peng HayD.M.SM., D.SM., P.J.K.Age : 60Nationality : MalaysianQualifications : Malaysian Certificate of EducationDirectorate : Independent Non-Executive DirectorDesignation : Company DirectorOther Directorships of Public Companies :Bonia Corporation BerhadFarm’s Best BerhdTa Win Holdings BerhadWellcall Holdings BerhadICapital.BizBerhadThe Tun Hussein Onn National Eye HospitalThe Date He Was First Appointed to the Board :16 June 1997

The details of any Board Committee to which hebelongs : Audit committee, Remuneration Committee andNomination Committee of Komarkcorp Berhad

Securities holding in the company : Nil

Securities holding in the Subsidiaries : NilFamily Relationship With Any Director and / or Major Shareholders of the Company : None



Working Experience :Datuk Ng Peng Hong @ Ng Peng Hay was appointed to the Board of Komarkcorp Berhad on 16 June 1997. He was the State Assemblyman for Tengkera Constituency under Barisan Nasional between 1982 and 1986. He then served as a Senator in the Malaysian Parliament from 1987 to 1993. His first involvement in social activities was upon completing his secondary education. Datuk Ng has been appointed as the Investment Co-ordinator of the Malacca State Development Corporation to handle direct investments in the State of Melaka since 1988. Together with his team of officials and his excellent public relations, he has helped in attracting numerous Taiwanese, Singaporean and Chinese investors into the State of Melaka. In recognition of his efforts and dedication, Datuk Ng was conferred the Darjah Mulia Seri Melaka by his Excellency, the Governor of Melaka in 1992. On 17 July 1999, the Taiwanese Government awarded him the Economic Medal. Datuk Ng is the Chairman of MCA, 7th Branch Melaka since 1982. Presently, he is the Chairman of Koperasi Jayadiri Malaysia Berhad and is a Board Member of Malaysian Investment Development Authority (MIDA) and Director of The Tun Hussein Onn National Eye Hospital.




Chew Chee ChekAge : 42Nationality : MalaysianQualifications : Diploma In Commerce (Financial Accounting), Kolej Tunku Abdul Rahman The Association of Chartered Certified Accountants Directorate : Independent Non-Executive DirectorDesignation : Company DirectorOther Directorships of Public Companies :Wellcall Holdings BerhadThe Date He Was First Appointed to the Board :15 April 2003

The details of any Board Committee to which he belongs : Audit committee, Remuneration Committee and Nomination Committee of Komarkcorp Berhad

Securities holding in the company : NilSecurities holding in the Subsidiaries : NilFamily Relationship With Any Director and / or Major Shareholders of the Company : None



Working Experience :Mr. Chew Chee Chek was appointed to the Board of Komarkcorp Berhad on 15 April 2003. He is a Fellow of the Association of Chartered Certified Accountants, UK. He started his career as an Audit Assistant in BDO Binder, Kuala Lumpur, a public accounting firm, from 1994 to 1995. In 1995, he joined PricewaterhouseCoopers (then known as Coopers & Lybrand)asAuditSemiSeniorandsubsequentlypromotedto Audit Senior. In 1996, he joined Alliance Merchant Bank Berhad (then known as Amanah Merchant Bank Berhad) as aCorporateFinanceExecutivewhereheacquiredextensiveexperience in corporate restructuring exercise involving initial publicoffer,mergerandacquisition,reversetakeover,backdoor listing, debt restructuring, rights issue, private placement andbonus issue.Subsequently,hewaspromotedtotheposition of Corporate Finance Assistant Manager. In 2000, he joined Komarkcorp Berhad as the Group Financial Controller. He resigned from Komarkcorp Berhad in the same year and advanced his career by jointly setting up WCL Consulting Sdn Bhd, a management consultancy firm, with various partners where he was appointed as Director and later resigned in August 2006. In April 2006, he was appointed as the Executive Director of Wellcall Holdings Berhad. He also sits on the board of directors of several private limited companies.


Ihsan Bin IsmailAge : 49Nationality : MalaysianQualifications : Master Degree in Business AdministrationCalifornia State University, School of Business Administration, Bachelor of Science in Business Administration Oregon State University, School of Business AdministrationDirectorate : Independent Non-Executive DirectorDesignation : Company DirectorOther Directorships of Public Companies : NoneThe Date He Was First Appointed to the Board :1 January 2009

The details of any Board Committee to which he belongs : Audit committee of Komarkcorp Berhad

Securities holding in the company : Nil

Securities holding in the Subsidiaries : NilFamily Relationship With Any Director and / or Major Shareholders of the Company : None



Working Experience :Encik Ihsan Bin Ismail was appointed to the Board of Komarkcorp Berhad on 1 January 2009. He joined Lembaga Tabung Haji as an investment officer after graduating from Califonia State University, USA in 1987 with a Master degree in Business Administration. Encik Ihsan was attached to Lembaga Tabung Haji for 9 years from 1987 to 1996 and he was a special assistant to Deputy Director General in Investment and an assistant director of corporate affair prior to setting up his own business. He also represented Tabung Haji in several companies namely Peladang Tabung Haji Sdn Bhd for 7 years from 1989 to 1996 and Syarikat Times Offset Malaysia Sdn Bhd for 15 years from 1992 to 2007.

Encik Ihsan has wide experience in investment manage-ment and project evaluations.



STATEMENT ON CORPORATE GOVERNANCE

The Board of Directors appreciates the importance of adopting high standards of corporate governance within the Group. The Board views corporate governance as synonymous with three key concepts: namely transparency, accountability and corporate performance.

As such, the Board strives to adopt the substance behind corporate governance prescriptions and not merely the form. The Board is thus fully committed to the maintenance of high standards of corporate governance by supporting and implementing the prescriptions of the principles and best practices set out in the Malaysian Code on Corporate Governance (Revised 2007) (“Code”).

The Board is pleased to provide the following statement, which outlines the main corporate governance practices that were in place throughout the financial year, unless otherwise stated.

Principles Statement

The following statement sets out how the Group has applied and the extent of its compliance with the best practices set out in the Code.

A. BOARD OF DIRECTORS

Board Responsibilities

The Group acknowledges the pivotal role of the Board of Directors in the stewardship of its direction and operations, and ultimately the enhancement of long-term shareholder value. To fulfil this role, the Board is responsible for the overall corporate governance of the Group, including its strategic direction, establishing goals for management and monitoring the achievement of these goals. The role and function of the Board, as well as the differing roles of executive directors and non-executive directors are clearly delineated and defined.

The Board has a formal schedule of matters reserved to itself for decision, which includes the overall Group strategy anddirection,acquisitionandinvestmentpolicy,approvalofmajorcapitalexpenditure,considerationofsignificantfinancial matters and its review of the financial and operating performance of the Group. The schedule ensures that the governance of the Group is firmly in the Board’s hands.

Meetings

TheBoardordinarilymeetsatleastfour(4)timesayearatquarterlyintervalswithadditionalmeetingsconvenedwhen urgent and important decisions need to be taken. During the financial year ended 30 April 2012, the Board metonfour(4)occasions;whereitdeliberateduponandconsideredavarietyofmattersincludingtheGroup’sfinancial results, major investments and strategic decisions, the business plan, corporate finance and developments and directions of the Group.

PriortoeachBoardmeeting,Directorsarefurnishedwithcomprehensiveinformationonmattersrequiringtheirdeliberation. The Board papers encompass both quantitative and qualitative factors which enable informeddecision-making. All proceedings, deliberations and resolutions passed at the Board meetings are minuted by the Company Secretary and confirmed by the Chairman of the meeting.

Details of each Director’s attendance at the Board meetings held during the financial year ended 30 April 2012 are as follows:-

Name of Director Attendance %

Koh Hong Muan @ Koh Gak Siong 4/4 100

Koh Chie Jooi 3/4 75

Koh Chee Mian 4/4 100

Koh Chee Kian 4/4 100

Koh Chee Hao 3/4 75

Datuk Ng Peng Hong @ Ng Peng Hay 4/4 100

Chew Chee Chek 4/4 100

Ihsan bin Ismail 4/4 100


STATEMENT ON CORPORATE GOVERNANCE (CONT’D)

A. BOARD OF DIRECTORS (Cont’d)

Board Committees

To assist the Board in carrying out its fiduciary duties and to enhance business and operational efficiency, the Board of Directors delegates certain duties to its committees, namely the Audit Committee, Nomination Committee and Remuneration Committee.

All committees have written terms of reference and the Board receives reports of their proceedings and deliberations. The Chairman of the various committees will report to the Board the outcome of the Committee meetings which will be recorded in the minutes of the Board meeting.

Board Balance

Asat thedateof thisstatement, theBoardconsistsofeight (8)members;comprising three (3) independentnon-executive directors and five (5) executive directors. A brief profile of each director is presented on pages 15 to 18 of the Annual Report.

The concept of independence adopted by the Board is in tandem with the definition of an independent director in paragraph1.01oftheBursaSecuritiesMainMarketListingRequirements(“MMLR”)andthePracticeNote13issuedpursuant to the MMLR. The key element for fulfilling the criteria is the appointment of an independent director who is not a member of management and who is free of any relationship which could interfere with the exercise of independent judgement or the ability to act in the best interest of the Company. The Board’s composition complies withparagraph15.02oftheMMLRwhichrequiresthatat leasttwo(2)directorsorone-thirdoftheBoardoftheCompany, whichever is the higher, are independent directors.

The directors with their different backgrounds and specialisation, collectively bring with them a wide range of experience and expertise in areas such as finance, corporate affairs, marketing and operations. The executive directors are responsible for implementing the policies and decisions of the Board, overseeing the operations as well as co-ordinating the development and implementation of business and corporate strategies. The independent non-executive directors bring with them objective and independent judgement to decision-making and provide a capable check and balance for the executive directors.

There is a clear division of responsibilities at the head of the Company to ensure a balance of authority and power. The Board is led by Datuk Ng Peng Hong @ Ng Peng Hay as the independent non-executive Chairman of Audit Committee and the executive management is led by Mr Koh Hong Muan @ Koh Gak Siong, the Group Chairman/Chief Executive Officer.

The roles of Chairman of Audit Committee and the Group Chairman/Chief Executive Officer are clearly defined within each individual position description. The Chairman is responsible for running the Board and ensuring that all directors receive sufficient information on financial matters to enable them to participate actively in Board deliberations and decisions and in addition, being the Group Chairman/Chief Executive Officer, he is also responsible for the day to day management of the business as well as implementation of the Board’s policies and decisions. In order to ensure there is a balance of power and authority, the independent directors are involved in unrestricted participation in the deliberations and decisions of the Board.

In view of the current composition of the Board, particularly the separation of the roles of the independent Chairman of the Audit Committee and Group Chairman/Chief Executive Officer, and the presence of other independent directors, the Board does not consider it necessary to nominate a Senior Independent Non-Executive Director to whom concerns of shareholders may be conveyed.

The Board is also satisfied that its composition fairly reflects the investment of minority shareholders in the Company.

Supply of Information

The Chairman ensures that all directors have full and timely access to information. Prior to the meetings of the Board and the Board Committees, notice of agenda together with previous minutes and other relevant information were circulated to all directors on a timely basis in order to enable the directors to be well informed and briefed before the meetings. All directors also have full and free access to information within the Group and can as individuals or as a full Board seek independent professional advice, in furtherance of their duties, at the expense of the Group. Every director also has unhindered access to the advice and services of the Company Secretary. The Board believes that the current Company Secretaries are capable of carrying out their duties to ensure the effective functioning of the Board. In the event that any one of the Company Secretary fails to fulfil her functions effectively, the terms of the appointment permits her removal and appointment of successor which is a matter for the Board to decide.



APPOINTMENTS TO THE BOARD

Nomination Committee

1. Objective

The principal objective of the Nomination Committee is to assist the Board of Directors in its responsibilities in nominating new nominees to the Board of Directors. The Nomination Committee shall also assess the directors of the Company on an on-going basis.

2. Membership

The members of the Nomination Committee for the time being are:-

Name of Director Directorship

Datuk Ng Peng Hong @ Ng Peng Hay Independent Non-Executive Director (Chairman)

Chew Chee Chek Independent Non-Executive Director

Koh Hong Muan @ Koh Gak Siong Executive Director

3. Composition of Members

The Board of Directors shall elect the Nomination Committee members from amongst themselves, a majority of whom are independent.

4. Chairman

The Chairman of the Nomination Committee shall be elected from amongst the Nomination Committee members and shall be an Independent Director. The Chairman of the Committee shall be approved by the Board of Directors. In the absence of the Chairman, the other Independent Director shall be the Chairman for that meeting.

5. Secretary

The Secretary of the Nomination Committee shall be the Company Secretary of the Company.

6. Meetings

The Nomination Committee may meet together for the despatch of business, adjourn and otherwise regulate the meetingsatleastonceayearormorefrequentasdeemednecessary.TheChairmanmaycallforadditionalmeetingsat any time at the Chairman’s discretion.

TheSecretaryshallontherequisitionofthemembersoftheNominationCommitteesummonameetingoftheNomination Committee except in the case of an emergency, reasonable notice of every Nomination Committee meeting shall be given in writing.

Details of each Nomination Committee Member’s attendance at Nomination Committee Meeting held during the financial year ended 30 April 2012 are as follows:-

Name of Nomination Committee Member Attendance

Datuk Ng Peng Hong @ Ng Peng Hay 1/1

Chew Chee Chek 1/1

Koh Hong Muan @ Koh Gak Siong 1/1

During the year, the Nomination Committee had reviewed and assessed the mix of skills and experience including core competencies which the Directors should bring to the Board and assessed the contribution of each Director (including the independent Directors and Chief Executive Officer) and the effectiveness of the committees of the Board and the Board as a whole.

7. Quorum

Aquorumshallconsistoftwo(2)members,oneofwhomshallbeanIndependentDirector.



APPOINTMENTS TO THE BOARD (Cont’d)

8. Authority

The Nomination Committee shall in accordance with a procedure or process to be determined by the Board of Directors and at the expense of the Company:-

8.1 shallannuallyreviewtherequiredmixofskillsandexperienceandotherqualities,includingcorecompetencieswhichnon-executiveandexecutivedirectorsshouldhave;

8.2 shall assess on an annual basis, the effectiveness of the Board of Directors as a whole, the committees of the Boardandforassessingthecontributionofeachindividualdirector;and

8.3 shall be entitled to the services of the Company Secretary who must ensure that all appointments are properly made that all necessary information is obtained from the directors, both for the Company’s own records and for the purposes of meeting statutory obligations, as well as obligations arising from the MMLR or other regulatory requirements.

9. Duties and Responsibilities

The duties and responsibilities of the Nomination Committee are:-

9.1 to recommend to the Board of Directors, candidates for all directorships to be filled by the shareholders or the BoardofDirectors;

9.2 to consider, in making its recommendations, candidates for directorships proposed by the Group Managing Director, and within the bounds of practicability, by any other senior executive, director or shareholder and the NominationCommitteeshallconsiderthecandidates’;

• skills,knowledge,expertiseandexperience;• professionalism;• integrity;and• inthecaseofcandidatesforthepositionofindependentnon-executivedirectors,theNominationCommittee

shall also evaluate the candidates’ ability to discharge such responsibilities/functions as are expected from independentnon-executivedirectors;

9.3 torecommendtotheBoardofDirectors,thenomineestofilltheseatsontheboardcommittees;

9.4 to reviewannually the requiredmixofskillsandexperienceof theBoard, including thecorecompetencieswhichdirectorsshouldbringtotheBoard;

9.5 to assess annually the effectiveness of the Board of Directors as a whole, the committees of the Board and the contribution of each individual director, including the independent non-executive directors, as well as the chief executive officer. All assessments and evaluations carried out by the Nomination Committee in the discharge ofallitsfunctionsshallbeproperlydocumented;

9.6 toactinlinewiththedirectionsoftheBoardofDirectors;and

9.7 to consider and examine such other matters as the Nomination Committee considers appropriate.

The Board and the Nomination Committee considered the appointment of an Executive Director as a member of the Nomination Committee, which is a departure from the best practices of the Code, necessary to provide the Board and the Nomination Committee with the views of the executive management.



APPOINTMENTS TO THE BOARD (Cont’d)

Directors’ Training

The Group acknowledges the fact that continuous education is vital for the Board members to gain insight into the state of economy, technological advances in our core business, latest regulatory developments and management strategies. Therefore, the Directors are encouraged to evaluate their own training needs on a continuous process and to determine the relevant programmes, seminars and briefings that would enhance their knowledge to enable the Directors to discharge their responsibilities more effectively. All members of the Board have attended the Mandatory Accreditation Programme organised by the Bursa Securities’ approved organisations.

TheCompanySecretarycirculatedtherelevantguidelinesonregulatoryrequirementsfromtimetotimefortheBoard’sreferenceandbriefedtheBoardquarterlyontheseupdatesattheBoardMeetings.

For the financial year ended 30 April 2012, the trainings attended by the Directors are as follows:-

Director Course title

Koh Chie Jooi - Seminar on International Financial Reporting Standard organised by Messrs Ong & Wong, Chartered Accountants on 15 December 2011

Koh Chee Kian - Mandatory Accreditation Programme organised by the Bursa Securities’ approved organisations on 5 and 6 October 2011

- 2012 Budget Proposals Tax Changes and its impact on Business on 18 October 2011

Koh Chee Hao - Mandatory Accreditation Programme organised by the Bursa Securities’ approved organisations on 5 and 6 October 2011

- 2012 Budget Proposals Tax Changes and its impact on Business on 18 October 2011

Datuk Ng Peng Hong @ Ng Peng Hay - Briefing on the New Corporate Governance Blueprint issued by Securities Commission on 23 August 2011

- Seminar on Brief Update on 2012 Tax Budget, Corporate Governance Guide and Internal Audit Roles on 19 December 2011

Chew Chee Chek - Seminar on International Financial Reporting Standard organised by Messrs Ong & Wong, Chartered Accountants on 15 December 2011

Ihsan bin Ismai - 2012 Budget Proposals Tax Changes and its impact on Business on 18 October 2011

Re-election

The Articles of Association of the Company provide that at least one-third of the Board is subject to retirement by rotation at each Annual General Meeting and all the Directors shall retire from office once at least in each three (3) years but shall be eligible for re-election. The Directors to retire in each year are the Directors who have been longest in office since their appointment or re-appointment. A retiring Director is eligible for re-appointment. This provides an opportunity for the shareholders to renew their mandates. The election of each Director is voted on separately. To assist shareholders in their decision, sufficient information such as personal profile, meetings attendance and the shareholdings in the Group of each Director standing for election are furnished in the Annual Report.

Directorsoverseventy(70)yearsofagearerequiredtosubmitthemselvesforre-appointmentannuallyinaccordancewithSection 129(6) of the Companies Act, 1965.



B. REMUNERATION COMMITTEE

1. Objective

The principal objective of the Remuneration Committee is to assist the Board of Directors in its responsibilities in assessing the remuneration packages of the Group Chairman and Executive Directors.

2. MembershipThe members of the Remuneration Committee for the time being are:-




Koh Hong Muan @ Koh Gak Siong Executive Director

3. Composition of Members

The Board of Directors shall elect the Remuneration Committee members from amongst themselves, a majority of whom are independent.

4. Chairman

The Chairman of the Remuneration Committee shall be elected from amongst the Remuneration Committee members and shall be an Independent Director. The Chairman of the Committee shall be approved by the Board of Directors.

5. Secretary

The secretary of the Remuneration Committee shall be the Company Secretary of the Company.

6. Meetings

The Remuneration Committee may meet together for the despatch of business, adjourn and otherwise regulate themeetingsatleastonceayearormorefrequentasdeemednecessary.TheChairmanmaycallforadditionalmeetings at any time at the Chairman’s discretion.

TheSecretaryshallontherequisitionofthemembersoftheRemunerationCommitteesummonameetingofthe Remuneration Committee except in the case of an emergency, reasonable notice of every Remuneration Committee meeting shall be given in writing.

Details of each Nomination Committee Member’s attendance at Nomination Committee Meeting held during the financial year ended 30 April 2012 are as follows:-

Name of Nomination Committee Member Attendance


Koh Hong Muan @ Koh Gak Siong 1/1

Chew Chee Chek 1/1

During the year, the Remuneration Committee had reviewed the remuneration and fees payable to the Directors for recommendation to the Board of Directors for approval.

7. Quorum

Aquorumshallconsistoftwo(2)members,bothofwhomshallbeIndependentDirectors.



B. REMUNERATION COMMITTEE (Cont’d)

8. Authority

The Remuneration Committee shall in accordance with a procedure or process to be determined by the Board of Directors and at the expenses of the Company:-

8.1 shall review, assess and recommend to the Board of Directors, the remuneration packages of the executive directors in all forms, with other independent professional advice or outside advice as necessary;and

8.2 shall be entitled to the services of the Company Secretary who must ensure that all decisions made on remuneration packages of the executive directors be properly recorded and minuted in the minutes book.

9. Duties and Responsibilities

The duties and responsibilities of the Remuneration Committee are:-

9.1 to review and assess the remuneration packages of the Group Managing Director and Executive Directors inallforms,withorwithoutotherindependentprofessionaladviceorotheroutsideadvice;

9.2 to ensure the levels of remuneration be sufficiently attractive and be able to retain directors needed to run theCompanysuccessfully;

9.3 to structure the component parts of remuneration so as to link rewards to corporate and individual performanceandtoassesstheneedsoftheCompanyfortalentatboardlevelataparticulartime;

9.4 to recommend to the Board of Directors the remuneration packages of the Group Managing Director and ExecutiveDirectors;

9.5 toactinlinewiththedirectionsoftheBoardofDirectors;and

9.6 to consider and examine such other matters as the Remuneration Committee considers appropriate.

The remuneration of the Directors of Komarkcorp Berhad for the financial year ended 30 April 2012 are as follows:-

Type Executive Directors Non-Executive Directors

Aggregate Remuneration RM’000 RM’000

Directors’ Fees 604 75

Salaries 1,801 -

Allowance 10 6

Bonuses - -

Commission - -

Benefits in kind based on an estimated money value - -

Total 2,415 81

Band (RM) Executive Directors Non-Executive Directors

Below 50,000 - 3

50,001 - 100,000 2 -

550,001 - 600,000 2 -

1,100,000 - 1,150,000 1 -

Total 5 3



C. SHAREHOLDERS

The Annual General Meeting (“AGM”)

The Company recognises the importance of the accountability to its shareholders through proper communication with them. The AGM is the principal forum for dialogue with the shareholders. Shareholders are notified of the meeting and provided with a copy of the Company’s Annual Report before the meeting. All shareholders are encouraged to attend the Annual General Meeting and participate in its proceedings. Every opportunity is given to the shareholders toaskquestionsandseekclarificationonthebusinessandperformanceoftheGroup.

TheAuditCommitteeisavailableattheAGMtoanswerquestionsandconsidersuggestions.Theexternalauditorsarealso present to provide their professional and independent clarification on issues of concern raised by the shareholders, if any.

Communication with Shareholders

TheannualreportandthequarterlyannouncementsaretheprimarymodeofcommunicationstoreportontheGroup’s business activities and financial performance to all shareholders.

The Company also maintains an effective communication channel between the Board, shareholders and the general public through timely dissemination of all material information.

Corporate Web-site

The Group maintains its corporate web-site at www.komark.com.my which has made available the corporate information, financial and other pertinent information to all its shareholders, at all times.

D. ACCOUNTABILITY AND AUDIT

Audit Committee

The objective of the Audit Committee is to assist the Board of Directors in meeting its responsibilities relating to accounting and reporting practices of the Company and its subsidiary companies. In addition, the Audit Committee shall:-

(a) OverseeandappraisethequalityoftheauditsconductedbothbytheCompany’sinternalandexternalauditors;

(b) Maintain open lines of communication between the Board of Directors, the internal auditors and external auditors fortheexchangeofviewsandinformation,aswellastoconfirmtheirrespectiveauthorityandresponsibilities;and

(c) DeterminetheadequacyoftheGroup’sadministrative,operatingandaccountingcontrols.

The Audit Committee’s Report is set out on pages 29 to 32 of the Annual Report.

Financial Reporting

Through the annual financial statements as well as the Chairman’s statement and review of operations in the Annual Reportandthequarterlyannouncementsofresultstoshareholders,theBoardaimstoprovideandpresentabalancedand meaningful assessment of the Group’s financial performance and prospects. The Board is assisted by the Audit CommitteetooverseetheGroup’sfinancialreportingprocessesandqualityofitsfinancialreporting.

Directors’ Responsibility Statement in Respect of the Preparation of the Audited Financial Statements

The Board is responsible for ensuring that the financial statements of the Group give a true and fair view of the state of affairs of the Group and of the Company as at the accounting period and of their profit or loss and cashflow for the period then ended. In preparing the financial statements, the Directors have ensured that applicable approved accounting standards in Malaysia and the provisions of the Companies Act, 1965 have been applied.

In preparing the financial statements, the Directors have applied consistently suitable accounting policies and made reasonable and prudent judgements and estimates.

The Directors also have a general responsibility for taking such steps as are reasonably available to them to safeguard the assets of the Group and to prevent fraud and other irregularities.


D. ACCOUNTABILITY AND AUDIT (Cont’d)

Statement on Internal Control

The Statement on Internal Control furnished on page 28 of the Annual Report provides an overview of the system of internal controls of the Group.

Relationship with the Auditors

Key features underlying the relationship between the Audit Committee and the external auditors are included in the Audit Committee’s Report as detailed on pages 29 to 32 of the Annual Report.

TheDirectorsarerequiredbytheCompaniesAct,1965topreparefinancialstatementsforeachfinancialyearwhichgive a true and fair view of the state of affairs of the Company and Group as at the end of the financial year and of the results and cash flow of the Company and Group for the year then ended thereat.

Inpreparingthefinancialstatements,theDirectorsarerequiredtoselectappropriateaccountingpoliciesandapplythem consistently to make reasonable and prudent judgements and estimates, and to state that all accounting standardswhichtheyconsidertobeapplicablehavebeenfollowed.TheDirectorsarealsorequiredtopreparethefinancial statements on the going concern basis unless it is inappropriate to do so.

The Directors have responsibility for ensuring that the Group keeps proper accounting records which disclose with reasonable accuracy at any time the financial position of the Group and which enable them to ensure that the financial statements comply with the Companies Act, 1965. The Directors also have responsibility for taking such steps that are reasonable to safeguard the assets of the Company and Group and for prevention and detection of fraud and other irregularities.

E. CORPORATE SOCIAL RESPONSIBILITY

The Group acknowledges and integrates the Corporate Social Responsibility (“CSR”) into its operations and decision making based on ethical values and respect for the environment, community, marketplace and employees’ welfare.

a) The Environment

The Group has undertaken various measures to mitigate the adverse impact from our manufacturing operations to the environment. The Group also encourages its staff to reduce the paper usage and recycle the wastage materials.

b) The Community

The Group continues to contribute to the charitable, social and welfare programs and authorities on ad hoc basis.

c) The Marketplace

The Group engages in ethical procurement practices by adopting a standard procedure in the vendor selection andensurethatthesuppliesareinaccordancetotheGroup’smaterialsrequirements.

The Group also continues to strive to meet the expectation of its shareholders by enhancing the value of the Group in all possible ways.

d) The Employees’ Welfare

The Group recognises that employees are important assets. In line with this belief, the Group provides a safe and healthy working environment to its employees with comprehensive occupational health and safety resources.

The Group believes in promoting employees’ morale through the proper human capital development.



STATEMENT ON INTERNAL CONTROL

The Board of Directors is ultimately responsible for the Group’s system of internal control and for reviewing the effectiveness of the internal control system during the year pursuant to paragraph 15.26 (b) of the Bursa Securities Main Market Listing Requirements(“MMLR”).Internalcontrolsystemisprimarilydesignedtocaterforthebusinessneedsandmanagethepotential business risks of the Group.

The Board has overall responsibility for the Group’s system of internal control, which aims to:

• safeguardshareholders’investmentsandtheGroup’sassets;

• ensurethatproperaccountingrecordsaremaintained;and

• ensurethatthefinancialinformationprovidedwithinthebusinessandforpublicationisreliable.

In view of the limitations that are inherent in any systems of internal control, such systems are designed to mitigate rather than eliminate the likelihood of fraud and error. Accordingly, these systems can provide only reasonable and not absolute assurance against material misstatement or loss. The concept of reasonable assurance also recognises that the cost of control procedures should not exceed the expected benefits.

There are always opportunities to further improve the current internal control systems of the Group. A programme of actions to enhance the internal control systems was undertaken in line with corporate governance compliance. The Company has on 30 March 2010 outsourced the internal audit function of the Group to a professional firm.

TheInternalAuditor’smainroleistoindependentlyassessoftheadequacyandintegrityofsuchsystemofinternalcontrolestablished by the Management based on the audit plan approved by the Board and to make appropriate recommendations for Management’s implementation. The Internal Auditors presents their report to the Audit Committee for deliberation.

In seeking to achieve the objectives of the internal control systems, the following key elements will be considered:

Control Environment and Activities

It is imperative that the Group should operate on a sound system of internal control. In general, the overall line of communications across the business should be defined and there is an appropriate integrity in risk management. There is also a limit on authority that clearly defines authorisation limits to ensure proper identification of accountabilities and segregation of duties. Operation control procedures have been established according to ISO 9001 standard. This will ensure that the business process flow is accordingly and properly executed.

Risk Management

The Board recognises that the management of principal risks plays an important and integral part of the Group’s daily operations and that the identification and the management of such risk will affect the achievement of the Group’s corporate objectives.

As an ongoing process, business issues faced by the Group are identified and evaluated and consideration is given on the potential impact of achieving the business objectives. This includes examining business issues in critical areas, assessing the likelihood of material exposures and identifying the measures taken to mitigate the risks arising from these issues.

Key Internal Control Processes

The following are the key processes that have been establish as part of the Group’s internal control effort:

(a) A clearly defined organisation and hierarchical structure outlining line of reporting and job responsibilities with strong risk control culture at the operational level.

(b) In ensuring that each operating unit is functioning efficiently, emphasis is placed on personal employed where the integrity and competence of personnel are ensured through recruitment evaluation process.

(c) FinancialreportsaresuppliedtotheAuditCommitteeandtheBoardonaquarterlybasisforreviewandifnecessarycorrection action to be taken.

(d) The Board, Audit Committee and Management meets regularly to review the internal audit reports and monitor the status of the implementation of recommendations to address internal control weakness noted.

(e) Regular reporting made to the Board by the Management of corporate, legal, accounting and environmental developments.


AUDIT COMMITTEE REPORT

COMPOSITION




Ihsan bin Ismail Independent Non-Executive Director

TERMS OF REFERENCE

1. OBJECTIVE

The objective of the Audit Committee is to assist the Board of Directors in meeting its responsibilities relating to accounting and reporting practices of the Company and its subsidiary companies.

In addition, the Audit Committee shall:-

a) OverseeandappraisethequalityoftheauditsconductedbothbytheCompany’sinternalandexternalauditors;

b) Maintain open lines of communication between the Board of Directors, the internal auditors and the external auditors for the exchange of views and information, as well as to confirm their respective authority and responsibilities;and

c) DeterminetheadequacyoftheGroup’sadministrative,operatingandaccountingcontrols.

2. COMPOSITION

The Audit Committee shall be appointed by the Directors from among their number (pursuant to a resolution of the BoardofDirectors)whichfulfilsthefollowingrequirements:-

a) theauditcommitteemustbecomposedofnofewerthanthree(3)members;

b) amajorityoftheauditcommitteemustbeindependentdirectors;

c) all members of the Audit Committee should be financially literate and at least one member of the audit committee:-

i) mustbeamemberoftheMalaysianInstituteofAccountants;or

ii) if he is not a member of the Malaysian Institute of Accountants, he must have at least thee (3) years’ working experience and:-

he must have passed the examinations specified in Part 1 of the 1st Schedule of the Accountants •Act,1967;or

he must be a member of one of the associations of accountants specified in Part II of the 1st Schedule •oftheAccountantsAct,1967;or

iii) fulfilstherequirementsasmaybeprescribedorapprovedbyBursaMalaysiaSecuritiesBerhad(“BursaSecurities”)and/orotherrelevantauthoritiesfromtimetotime;and

d) no alternate Director shall be appointed as a member of Audit Committee.

The members of the Audit Committee shall elect a chairman from among their number who shall be an independent director.

In the event of any vacancy in the Audit Committee resulting in the non-compliance of item 2 (a) to (c) above, the vacancy must be filled within three (3) months of that event.

The Board of Directors must review the term of office and performance of the Audit Committee and each of its members at least once every three (3) years to determine whether the Audit Committee and members have carried out their duties in accordance with the terms of reference.


AUDIT COMMITTEE REPORT (CONT’D)

3. FUNCTIONS

The functions of the Audit Committee are as follows:-

a) review the following and report the same to the Board of Directors:-

i) withtheexternalauditors,theauditplan;

ii) withtheexternalauditors,hisevaluationofthesystemofinternalcontrols;

iii) withtheexternalauditor,hisauditreport;

iv) theassistancegivenbytheCompany’semployeestotheexternalauditors;and

v) any related party transaction and conflict of interest situation that may arise within the Company or group includinganytransaction,procedureorcourseofconductthatraisesquestionsofmanagementintegrity.

b) Toconsidertheappointmentoftheexternalauditor,theauditfeeandanyquestionsofresignationordismissalandtheletterofresignationfromtheexternalauditor,ifapplicable;

c) To discuss with the external auditor before the audit commences, the nature and scope of the audit, and ensure co-ordinationwheremorethanoneauditfirmisinvolved;

d) Toreviewthequarterlyandyear-endfinancialstatementsoftheCompany,focusingparticularlyon:-

Anychangesinaccountingpoliciesandpractices;•

Significantadjustmentsarisingfromtheaudit;•

Thegoingconcernassumption;•

Compliancewithaccountingstandardsandotherlegalrequirements;•

e) To discuss problems and reservations arising from the interim and final audits, and any matter the auditor may wishtodiscuss(intheabsenceofmanagementwherenecessary);

f) Toreviewtheexternalauditor’smanagementletterandmanagement’sresponse;

g) To do the following in relation to the internal audit function:-

Ensure the internal audit function is independent of the activities it audits and the head of internal audit •reports directly to the Audit Committee. The head of internal audit will be responsible for the regular review and/or appraisal of the effectiveness of the risk management, internal control and governance processes withintheCompany;

Reviewtheadequacyofthescope,functions,competencyandresourcesoftheinternalauditfunction,•andthatithasthenecessaryauthoritytocarryoutitswork;

Review the internal audit programme and results of the internal audit process and where necessary, ensure •thatappropriateactionistakenontherecommendationsoftheinternalauditfunction;

Reviewanyappraisalorassessmentoftheperformanceofmembersoftheinternalauditfunction;•

Approveanyappointmentsorterminationofseniorstaffmembersoftheinternalauditfunction;•

Take cognisance of resignations of internal audit staff members (for in-house internal audit function) or •the internal audit service provider (for out-sourced internal audit function) and provide the resigning staff member or the internal audit service provider an opportunity to submit his reasons for resigning.



3. FUNCTIONS (Cont’d)

h) ToconsideranyrelatedpartytransactionthatmayarisewithintheCompanyandgroup;

i) Toconsiderthemajorfindingsofinternalinvestigationsandmanagement’sresponse;

j) To consider other areas as defined by the Board, or as may be prescribed by Bursa Securities or any other relevantauthorityfromtimetotime;and

k) Toperformanyotherfunctions/responsibilitiesasmayberequiredofthembyBursaSecuritiesorsuchotherrelevant authorities from time to time.

4. RIGHTS OF THE AUDIT COMMITTEE

The Audit Committee shall, wherever necessary and reasonable for the Company to the performance of its duties, in accordance with a procedure to be determined by the Board of Directors and at the cost of the Company:-

a) haveauthoritytoinvestigateanymatterwithinitstermsofreference;

b) havetheresourceswhicharerequiredtoperformitsduties;

c) havefullandunrestrictedaccesstoanyinformationpertainingtotheCompany;

d) have direct communication channels with the external auditors and person(s) carrying out the internal audit functionoractivity;

e) beabletoobtainindependentprofessionalorotheradvice;and

f) be able to convene meetings with the external auditors, the internal auditors or both, excluding the attendance of other directors and employees of the Company, whenever deemed necessary.

The Chairman of the Audit Committee shall engage on a continuous basis with senior management, such as the chairman/chief executive officer, the finance director, the head of internal audit and the external auditors in order to be kept informed of matters affecting the Company.

5. MEETINGS

The Audit Committee shall meet at least four (4) times a year and such additional meetings as the Chairman shall decide in order to fulfil its duties. However, at least twice a year the Audit Committee shall meet with the external auditors without the presence of executive Board members.

Inaddition,theChairmanmaycallameetingoftheAuditCommitteeifarequestismadebyanycommitteemember,the Company’s Chief Executive, or the internal or external auditors.

The Company Secretary or other appropriate senior official shall act as secretary of the Audit Committee and shall be responsible, in conjunction with the Chairman, for drawing up the agenda and circulating it, supported by explanatory documentation to committee members prior to each meeting.

The Secretary shall also be responsible for keeping the minutes of meetings of the Audit Committee, and circulating them to committee members and to the other members of the Board of Directors.

Aquorumshallconsistofamajorityofindependentdirectors.

By invitation of the Audit Committee, the Company must ensure that other directors and employees attend any particular audit committee meeting specific to the relevant meeting.



DETAILS OF ATTENDANCE AT AUDIT COMMITTEE MEETINGS DURING THE FINANCIAL YEAR ENDED 30 APRIL 2012

Number of Audit Committee Meetings held for the financial year: Four (4) Attendance of the Audit Committee members are shown below:-

Name of Audit Committee member Attendance


Chew Chee Chek 4/4

Ihsan bin Ismail 4/4

HIGHLIGHTS OF ACTIVITIES

During the financial year, the activities of the Audit Committee included:-

1. ReviewofthequarterlyfinancialresultspriortothereleaseoftheannouncementstoBursaSecurities.

2. Assessment of the external auditor’s findings in relation to audit and accounting issues arising from the audit of the Group’s financial statements and updates on the changes in the reporting of financial statements.

3. Discussion of audit strategy and plan with the internal and external auditors.

4. Examined findings made by the internal auditors and management’s response.

INTERNAL AUDIT FUNCTION AND SUMMARY OF ACTIVITIES

The internal audit function of the Company has been outsourced to an independent professional firm, which assists the Audit Committee in discharging its duties and responsibilities. They act independently and with due professional care and report directly to the Audit Committee.

During the financial year ended 30 April 2012, the Internal Auditors had carried out the following internal audit review:-

• CreditcontrolfunctionofGeneralLabels&Labelling(M)SdnBhd(“GLLM”)• TreasuryfunctionofGLLM

The professional fees incurred for the internal audit function in respect of financial year ended 30 April 2012 amounted to approximately RM6,143.75


OTHER INFORMATION

IncompliancewiththeBursaMalaysiaSecuritiesBerhad’sMainMarketListingRequirements,thefollowingadditionalinformation is provided:

1. Share Buy-Back

During the financial year ended 30 April 2012, the Company has purchased 2,000 of its own shares from the open market. None of the shares purchased has been sold or cancelled. The shares purchased are retained as treasury shares. Details of shares bought-back are as follows:

Month

Number ofshares

purchased

Lowestpurchase price

(RM)

Highest purchase price

(RM)

Average purchase price

(RM)

Total consideration

(RM)

Purchase

May-11 - - - - -

Jun-11 - - - - -

Jul-11 1,000 0.260 0.260 0.260 301.08

Aug-11 - - - - -

Sep-11 - - - - -

Oct-11 - - - - -

Nov-11 - - - - -

Dec-11 1,000 0.295 0.295 0.295 336.12

Jan-12 - - - - -

Feb-12 - - - - -

Mar-12 - - - - -

Apr-12 - - - - -

Total 2,000 637.20

2. Depository Receipt Programme

During the financial year, the Company did not sponsor depository receipt programme.

3. Imposition of Sanctions and/or Penalties

There were no sanctions and/or penalties imposed on the Company and its subsidiaries, Directors or Management by the relevant regulatory bodies.

4. Non-Audit Fees

The amount of non-audit fee paid or payable to external auditors and their affiliated company for the financial year ended 30 April 2012 are as follows:-

RM’000

O & W Tax Consultants Sdn. Bhd. 13.850


OTHER INFORMATION (CONT’D)

5. Profit Estimate, Forecast or Projection

There was no variance between the results of the financial year and the unaudited results previously announced.

The Company did not release any profit estimates, forecast or projections for the financial year.

6. Profit Guarantees

During the financial year, there were no profit guarantees given or received by the Company.

7. Material Contracts

During the financial year, there were no material contracts of the Company and its subsidiaries involving Directors’ and major shareholders’ interest.

8. Contracts Relating to Loans

There were no material contracts relating to loans by the Company involving Directors and major shareholders.

9. Utilisation of Proceeds

The Company did not implement any fund raising exercise during the financial year.

10. Options, Warrants or Convertible Securities

There were no options, warrants or convertible securities issued by the Company during the financial year under review.

11. Revaluation Policy

During the financial year, the Company and its subsidiaries do not have any revaluation policy on landed properties.

12. Disclosure of Recurrent Related Party Transactions

The details of the Recurrent Related Party Transactions of a revenue and trading nature carried out by the Group during the financial year ended 30 April 2012 are as follows:

Nature of transaction Company

Transacting Parties Nature of relationship

Amount transacted during the financial year(RM’000)

Sale of labels and related products to Komark Enterprise Co. Ltd (“Komark Enterprise”)

General Labels & Labelling (M) Sdn Bhd, Komark International Sdn Bhd (“KISB”)

Komark Enterprise (a 49%-owned associated company of KISB)

Koh Hong Muan @ Koh Gak Siong who is a Director and Major Shareholder of Komarkcorp, is also shareholder of Komark Enterprise via Aimas Enterprise. Koh Chie Jooi, Koh Chee Mian, Koh Chee Kian and Koh Chee Hao who are Directors of Komarkcorp, are also directors and shareholders of Aimas Enterprise and persons connected to Koh Hong Muan @ Koh Gak Siong. In addition, Koh Hong Muan @ Koh Gak Siong, Koh Chie Jooi, Koh Chee Mian, Koh Chee Kian, Koh Chee Hao and Aimas Enterprise have no direct shareholdings in Komark Enterprise other than via Komarkcorp.

181


Group2012 2011

RM'000 RM'000

Corporate guarantees in respect of credit facilitiesgranted to subsidiaries 72,000 112,854


FINANCIALSTATEMENTS

Directors’ Report 36

Statement by Directors 39

Statutory Declaration 39

Independent Auditors’ Report 40

Statements of Financial Position 42

Statements of Comprehensive Income 43

ConsolidatedStatementofChangesinEquity 44

StatementofChangesinEquity 45

Statements of Cash Flows 46

Notes to the Financial Statements 48

DIRECTORS’ REPORTFOR THE YEAR ENDED 30 APRIL 2012

The directors have pleasure in submitting their report and the audited financial statements of the Group and of the Company for the financial year ended 30 April 2012.

PRINCIPAL ACTIVITIES

The principal activities of the Company are investment holding and provision of management services to its subsidiaries. The principal activities of the subsidiaries are as set out in Note 6 to the financial statements. There have been no significant changes in these activities during the financial year.

RESULTS

GroupRM’000

CompanyRM’000

Profit/(loss) for the year 79 (2,599)

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

DIVIDEND

No dividend was paid nor declared since the end of the previous financial year and the directors do not recommend any dividend to be paid for the financial year.

RESERVES AND PROVISIONS

There were no material transfers to or from reserves or provisions during the financial year other than those disclosed in the financial statements.

ISSUE OF SHARES

During the financial year, there was no issue of shares.

TREASURY SHARES

During the financial year, the Company repurchased 2,000 ordinary shares from the open market at an average price of approximately RM0.32 per share. The total consideration paid for the repurchase including transaction costs was RM637 and this was financed by internally generated funds.

TheremainingrepurchasedsharesareheldastreasurysharesinaccordancewiththerequirementofSection67AoftheCompanies Act, 1965, and are disclosed in Note 16 to the financial statements.

SHARE OPTION

During the financial year, the Company did not grant any option to any person to take up the unissued shares of the Company.

SIGNIFICANT EVENT

On 18 July 2011, Komark International (M) Sdn. Bhd., a wholly-owned subsidiary of the Company had entered into a sale and purchase agreement with Auravilla Project Sdn. Bhd. to dispose of a piece of freehold land of the subsidiary for a consideration of RM8,000,000. This disposal was completed on 29 May 2012.

SUBSEQUENT EVENT

On 29 June 2012, the Company announced that an application will be made to the General Registry, Cayman Islands to strike off Komark China Ltd., a wholly-owned subsidiary of the Company from the Register of Companies pursuant to Section 156 of the Companies Act of Cayman Islands.


DIRECTORS’ REPORT (CONT’D)FOR THE YEAR ENDED 30 APRIL 2012

DIRECTORS

The directors who served from the date of the last report to the date of this report are:

Koh Hong Muan @ Koh Gak Siong Datuk Ng Peng Hong @ Ng Peng HayKoh Chie JooiChew Chee ChekKoh Chee MianIhsan Bin Ismail Koh Chee Kian Koh Chee Hao

DIRECTORS’ INTERESTS IN SHARES

According to the Register of Directors’ Shareholdings, the interests of directors in office at the end of the financial year in shares in the Company during the financial year were as follows:

Number of ordinary shares of RM1.00 each

Balance at Balance at01.05.2011 Bought Sold 30.04.2012

(Direct Interest)

Koh Hong Muan @ Koh Gak Siong 6,010,300 - - 6,010,300

(Indirect Interest)

Koh Hong Muan @ Koh Gak Siong 10,906,889# - - 10,906,889#

Koh Chie Jooi 16,917,189* - - 16,917,189*

Koh Chee Mian 16,917,189* - - 16,917,189*

Koh Chee Kian - 16,917,189* - 16,917,189*

Koh Chee Hao - 16,917,189* - 16,917,189*

# Deemed interested in shares held by an affiliated company, Aimas Enterprise Sdn. Bhd., a company incorporated in Malaysia, by virtue of Section 6A(4)(c) of the Companies Act, 1965.

* Deemed interested in the shares held by persons connected under Section 122A(1)(a) of the Companies Act, 1965.

By virtue of their interests in the shares of the Company, Koh Hong Muan @ Koh Gak Siong, Koh Chie Jooi, Koh Chee Mian, Koh Chee Kian and Koh Chee Hao are also deemed to have an interest in the shares of all the subsidiaries of the Company to the extent the Company has an interest.

Other than as disclosed above, none of the other directors in office at the end of the financial year had any interest in the shares of the Company or its related companies during the financial year.

DIRECTORS’ BENEFITS

Since the end of the previous financial year, no director has received or become entitled to receive any benefit (other than a benefit included in the aggregate amount of emoluments received or due and receivable by the directors shown in thefinancial statements or the fixed salary of a full-time employee of the Company) by reason of a contract made by the Company or a related corporation with any 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 Note 22 to the financial statements.

Neither during nor at the end of the financial year was the Company a party to any arrangements which object was to enablethedirectorstoacquirebenefitsbymeansoftheacquisitionofsharesinordebenturesoftheCompanyoranyother body corporate.


DIRECTORS’ REPORT (CONT’D)FOR THE YEAR ENDED 30 APRIL 2012

REMUNERATION COMMITTEE

The members of the Remuneration Committee who have served since the date of the last report are:

Datuk Ng Peng Hong @ Ng Peng HayKoh Hong Muan @ Koh Gak Siong Chew Chee Chek

OTHER STATUTORY INFORMATION

a. Before the financial statements 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 allowancefordoubtfuldebts;and

(ii) to ensure that any current assets which were unlikely to realise their book values in the ordinary course of business had been written down to an amount which they might be expected so to realise.

b. At the date of this report, the directors are not aware of any circumstances:

(i) which would render the amount written off as bad debts, or the amount of the allowance for doubtful debts in thefinancialstatementsoftheGroupandoftheCompanyinadequatetoanysubstantialextent;

(ii) which would render the value attributed to the current assets in the financial statements of the Group and of the Companymisleading;

(iii) which have arisen which render adherence to the existing methods of valuation of assets or liabilities in the financialstatementsoftheGroupandoftheCompanymisleadingorinappropriate;and

(iv) not otherwise dealt with in this report or in the financial statements of the Group and of the Company, that would render any amount stated in the respective financial statements misleading.

c. At the date of this report, there does not exist:

(i) any charge on the assets of the Group and of the Company that has arisen since the end of the financial year whichsecurestheliabilitiesofanyotherperson;or

(ii) any contingent liability in respect of the Group and of the Company that has arisen since the end of the financial year.

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

e. 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 and of the Company for the financial year in which this report is made.

AUDITORS

The Auditors, ONG & WONG, have indicated their willingness to continue in office.

Signed in accordance with a resolution of the directors

KOH HONG MUAN @ KOH GAK SIONGDirector

KOH CHIE JOOIDirector

Dated: 30 August 2012Kuala Lumpur


STATEMENT BY DIRECTORS(PURSUANT TO SECTION 169[15] OF THE COMPANIES ACT, 1965)

STATUTORY DECLARATION(PURSUANT TO SECTION 169[16] OF THE COMPANIES ACT, 1965)

We, KOH HONG MUAN @ KOH GAK SIONG and KOH CHIE JOOI, being two of the directors of KOMARKCORP BERHAD, do hereby state that, in the opinion of the directors, the financial statements set out on pages 42 to 81 are drawn up in accordance with the provisions of the Companies Act, 1965 and applicable Financial Reporting Standards in Malaysia so as to give a true and fair view of the states of affairs of the Group and of the Company as at 30 April 2012 and of the resultsoftheiroperations,changesinequityandcashflowsoftheGroupandoftheCompanyforthefinancialyearendedon that date.

Signed in accordance with a resolution of the directors

KOH HONG MUAN @ KOH GAK SIONGDirector

KOH CHIE JOOIDirector


I, KOH HONG MUAN @ KOH GAK SIONG, being the director primarily responsible for the financial management of KOMARKCORP BERHAD, do solemnly and sincerely declare that the financial statements set out on pages 42 to 81 are, to the best of my knowledge and belief, correct and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declaration Act, 1960.

Subscribed and solemnly declared bythe abovenamed, at Kuala Lumpur in Wilayah Persekutuan on 30 August 2012

KOH HONG MUAN @ KOH GAK SIONG

Before me,


INDEPENDENT AUDITORS’ REPORTTO THE MEMBERS OF KOMARKCORP BERHAD

Report on the Financial Statements

We have audited the financial statements of Komarkcorp Berhad, which comprise the statements of financial position as at 30 April 2012 of the Group and of the Company, and the statements of comprehensive income, statements of changes inequityandcashflowstatementsoftheGroupandoftheCompanyforthefinancialyearthenended,andasummaryofsignificant accounting policies and other explanatory notes, as set out on pages 42 to 81.

Directors’ Responsibility for the Financial Statements

The directors of the Company are responsible for the preparation of financial statements that give a true and fair view in accordance with Financial Reporting Standards and the Companies Act 1965 in Malaysia, and for such internal control as the directors determine are necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordancewithapprovedstandardsonauditinginMalaysia.Thosestandardsrequirethatwecomplywithethicalrequirementsandplanandperformtheaudittoobtainreasonableassurancewhetherthefinancialstatementsarefreefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgment, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Company’s preparation and fair presentation of the financial statements 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 Company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Company as of 30 April 2012 and of their financial performance and cash flows for the financial year then ended.

Report on Other Legal and Regulatory Requirements

InaccordancewiththerequirementsoftheCompaniesAct,1965inMalaysia,wealsoreportthefollowing:

a) Inouropinion,theaccountingandotherrecordsandtheregistersrequiredbytheActtobekeptbytheCompanyand its subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the Act.

b) We have considered the financial statements and the auditors’ reports of all the subsidiaries of which we have not acted as auditors, which are indicated in Note 6 to the financial statements.

c) We are satisfied that the financial statements of the subsidiaries that have been consolidated with the Company’s financial statements are in form and content appropriate and proper for the purposes of the preparation of the financial statementsoftheGroupandwehavereceivedsatisfactoryinformationandexplanationsrequiredbyusforthosepurposes.

d) Theauditreportsonthefinancialstatementsofthesubsidiariesdidnotcontainanyqualificationoranyadversecomment made under Section 174(3) of the Act.


INDEPENDENT AUDITORS’ REPORT (CONT’D)TO THE MEMBERS OF KOMARKCORP BERHAD

Other Matters

This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.

ONG & WONG WONG SHAN TYAF 0241 2837/06/13(J)Chartered Accountants Partner of Firm



STATEMENTS OF FINANCIAL POSITION AS AT 30 APRIL 2012

Group Company

Note 2012 2011 2012 2011RM’000 RM’000 RM’000 RM’000

(Restated)

ASSETS

Non-current assetsProperty,plantandequipment 3 125,413 135,167 - - Prepaid lease payments on land 4 1,701 1,658 - - Investment property 5 190 195 - - Investments in subsidiaries 6 - - 31,683 31,683 Investment in associate 7 - - - - Other investment 8 4 4 - - Development expenditure 9 2,656 510 - - Goodwill on consolidation 10 1,750 1,750 - -

131,714 139,284 31,683 31,683

Current assetsInventories 11 38,023 36,992 - - Receivables 12 38,750 35,105 54 50 Amount due from related companies 13 - - 40,945 43,681 Tax recoverable 140 53 - - Cash and bank balances 14 6,166 5,880 3 3

83,079 78,030 41,002 43,734

TOTAL ASSETS 214,793 217,314 72,685 75,417

EQUITY AND LIABILITIES

Equity attributable to equity holders of the CompanyShare capital 15 81,275 81,275 81,275 81,275 Treasury shares 16 (437) (437) (437) (437)Share premium 15,289 15,289 15,289 15,289 Reserves 17 23,775 22,184 (28,357) (25,758)

Total equity 119,902 118,311 67,770 70,369

Non-current liabilitiesBorrowings 18 13,150 20,130 - - Deferred tax liabilities 19 1,406 1,525 - -

14,556 21,655 - -

Current liabilities 20 26,253 20,418 627 761 Payables 13 - - 1,300 1,300 Amount due to related company 18 52,869 55,580 2,988 2,987 Borrowings 1,213 1,350 - -

Tax payable 80,335 77,348 4,915 5,048

Total liabilities 94,891 99,003 4,915 5,048

TOTAL EQUITY AND LIABILITIES 214,793 217,314 72,685 75,417

The annexed notes form an integral part of these financial statements.


STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 APRIL 2012

Group Company

Note 2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Revenue 123,346 112,968 - 101 Cost of sales (66,146) (62,643) - -

Gross profit 57,200 50,325 - 101 Other operating income 21 783 909 - - Depreciation and amortisation (11,651) (11,461) - - Staff costs and employee benefits (20,927) (17,655) (1,966) (2,334)Other operating expenses (19,793) (14,424) (377) (529)

Profit/(loss) from operations 5,612 7,694 (2,343) (2,762)Finance costs (4,782) (4,794) (256) (245)

Profit/(loss) before tax 22 830 2,900 (2,599) (3,007)Tax expense 23 (751) (785) - -

Profit/(loss) for the year 79 2,115 (2,599) (3,007)Other comprehensive income- Foreign currency translation 1,512 (268) - -

Total comprehensive income/(loss) for the year 1,591 1,847 (2,599) (3,007)

Profit/(loss) for the year attributable to:-EquityholdersoftheCompany 79 2,115 (2,599) (3,007)- Minority interest - - - -

Total comprehensive income/(loss) for the year attributable to:-EquityholdersoftheCompany 1,591 1,847 (2,599) (3,007)- Minority interest - - - -

Basic earnings per share attributable toequityholdersoftheCompany(sen) 24 0.1 2.7



CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 APRIL 2012

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 APRIL 2012

STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 APRIL 2012

Non-

distributable

Share Treasury Share Accumulated Total

Note capital shares premium losses Equity

RM’000 RM’000 RM’000 RM’000 RM’000

At 1 May 2010 81,275 (436) 15,289 (22,751) 73,377

Total comprehensive loss for the year - - - (3,007) (3,007)

Treasury shares 16

- repurchased - (1) - - (1)

At 30 April 2011/1 May 2011 81,275 (437) 15,289 (25,758) 70,369

Total comprehensive loss for the year - - - (2,599) (2,599)

Treasury shares 16

- repurchased - -# - - -#

At 30 April 2012 81,275 (437) 15,289 (28,357) 67,770

# Amount less than RM1,000.



STATEMENTS OF CASH FLOWS FOR THE YEAR ENDED 30 APRIL 2012

Group Company

Note 2012 2011 2012 2011RM’000 RM’000 RM’000 RM’000

(Restated)

CASH FLOWS FROM OPERATING ACTIVITIESProfit/(Loss) before tax 830 2,900 (2,599) (3,007)Adjustments for: Amortisation of development expenditure 357 373 - - Amortisation of prepaid lease payment on land 43 42 - - Bad debt written off 92 - - - Netgainondisposalofproperty,plantandequipment (289) (164) - - Depreciationofproperty,plantandequipmentand investment property 11,251 11,169 - - Loss/(gain) on foreign exchange, unrealised 125 (289) - - Interest expense 4,782 4,794 256 245 Interest income (70) (73) - -

Operating profit/(loss) before working capital changes 17,121 18,752 (2,343) (2,762)(Increase)/decrease in inventories (1,031) 320 - - (Increase)/decrease in receivables (3,862) (147) 2,731 3,150 Increase/(decrease) in payables 5,835 1,075 (133) (151)

Cash generated from operations 18,063 20,000 255 237 Tax paid (1,094) (510) - - Interest paid (4,782) (4,794) (256) (245)Interest received 70 73 - -

Net cash generated from/(used in) operating activities 12,257 14,769 (1) (8)

CASH FLOWS FROM INVESTING ACTIVITIESAcquisitionofproperty,plantandequipment A (5,674) (8,164) - - Proceedsfromdisposalofproperty,plantandequipment 8,727 696 - - Development expenditure paid (2,497) (106) - -

Net cash generated from/(used in) investing activities 556 (7,574) - -

CASH FLOWS FROM FINANCING ACTIVITIESPurchase of treasury shares -# (1) -# (1)Decrease in deposits pledged with licensed banks 1,699 - - - Proceeds from loan 13,349 8,868 - - Repayment of term loans and other borrowings (16,598) (5,684) - - Repayment of hire purchase and lease financing (3,641) (4,778) - - Net change in bills payable (3,344) (2,081) - -

Net cash used in financing activities (8,535) (3,307) -# (1)

Netincrease/(decrease)incashandcashequivalents 4,278 3,888 (1) (9)Effects of exchange rate changes (1,026) (6,853) - - Cashandcashequivalentsatbeginningofyear (17,760) (14,795) (2,984) (2,975)

Cashandcashequivalentsatendofyear B (14,508) (17,760) (2,985) (2,984)



STATEMENTS OF CASH FLOWS (CONT’D) FOR THE YEAR ENDED 30 APRIL 2012

NOTE

A. ACQUISITION OF PROPERTY, PLANT AND EQUIPMENT

Duringthefinancialyear,theGroupandtheCompanyacquiredtheproperty,plantandequipmentby:

Group Company

2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Cash 5,674 8,164 - - Hire purchase 1,810 1,809 - -

7,484 9,973 - -

B. CASH AND CASH EQUIVALENTS

Cashandcashequivalentsincludedinthecashflowstatementcomprisethefollowingbalancesheetamounts:

Group Company

2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Cash and bank balances 6,166 5,880 3 3 Less: Deposits pledged with licensed institutions (631) (2,330) - - Bank overdrafts (20,043) (21,310) (2,988) (2,987)

(14,508) (17,760) (2,985) (2,984)


NOTES TO THE FINANCIAL STATEMENTS 30 APRIL 2012

1. GENERAL INFORMATION

The principal activities of the Company are investment holding and provision of management services to its subsidiaries. The principal activities of the subsidiaries are as set out in Note 6.

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.

The registered office is located at Lot 6.05, Level 6, KPMG Tower, 8 First Avenue, Bandar Utama, 47800 Petaling Jaya, Selangor Darul Ehsan.

2. SIGNIFICANT ACCOUNTING POLICIES

The accounting policies adopted by the Group and by the Company are consistent with those adopted in the previous years except for the adoption of the following new and revised Financial Reporting Standards (“FRSs”) effective for the financial year beginning on 1 May 2011:

FRS 1 First-time Adoption of Financial Reporting StandardFRS 3 Business Combinations Amendments to Non-current Assets Held for Sale and Discontinued FRS 5 OperationsAmendments to Consolidated and Separate Financial Statements FRS 127 Amendments to Intangible Assets FRS 138IC Interpretation 17 Distribution of Non-cash Assets to Owners Amendment to Limited Exemption from Comparative FRS 7 Disclosures for FRS 1 First-time AdoptersAmendments to Business Combinations FRS 3Amendments to Improving Disclosures about Financial Instruments FRS 7 Amendments to Financial Instruments: Presentation FRS 132

The adoption of the above did not have any significant effects on the Group and the Company results upon their initial application, other than as discussed below:

i) Amendments to FRS 127 Consolidated and Separate Financial Statements

Under the revised FRS 127, minority interest is referred to as non-controlling interest. The amendments to FRS 127requirethatachangeintheownershipinterestofasubsidiary(withoutlossofcontrol)isaccountedforasanequitytransaction.Therefore,suchtransactionswillnolongergiverisetoachangeingoodwill,norwilltheygive rise to a gain or loss. Further, losses within a subsidiary are attributed to the non-controlling interest even if that results in a deficit balance.

ii) Amendments to FRS 7: Improving Disclosures about Financial Instruments

Theamendedstandardrequiresenhanceddisclosureaboutfairvaluemeasurementandliquidityrisk.Fairvaluemeasurements related to items recorded at fair value are to be disclosed by source of inputs using a three level fair value hierarchy (Level 1, Level 2 and Level 3), by class, for all financial instruments recognised at fair value. AreconciliationbetweenthebeginningandendingbalanceforLevel3fairvaluemeasurementsisrequired.Anysignificant transfers between levels of the fair value hierarchy and the reasons for those transfers need to be disclosed.Theamendmentsalsoclarifytherequirementsforliquidityriskdisclosureswithrespecttoderivativetransactionsandassetsusedforliquiditymanagement.


NOTES TO THE FINANCIAL STATEMENTS (CONT’D) 30 APRIL 2012

2. SIGNIFICANT ACCOUNTING POLICIES (cont’d)

The Group has chosen not to early adopt the following FRSs and IC Interpretations (“ICs”) which are not yet effective but are relevant to the Group: Effective for financialFRS periods beginning on or after

IC Interpretation 19 Extinguishing Financial 1 July 2011 LiabilitieswithEquity Instruments Amendments to FRS 7 Transfers of Financial Assets 1 January 2012Amendments to FRS 112 Deferred Tax: Recovery of 1 January 2012 Underlying AssetsFRS 124 Related Party Disclosures 1 January 2012

The directors expect that the adoption of the standards and interpretations above will have no material impact on the financial statements in the period of their initial application.

On 19 November 2011, the Malaysian Accounting Standards Board (“MASB”) issued a new MASB approved accounting framework, the Malaysian Financial Reporting Standards (“MFRS”) Framework.

The MFRS Framework is to be applied by all Entities Other Than Private Entities for annual periods beginning on or after 1 January 2012, with the exception of entities that are within the scope of MFRS 141: Agriculture (“MFRS 141”) and IC Interpretation 15: Agreements for Construction of Real Estate (“IC 15”), including its parent, significant investor and venturer.

TheGroupwillberequiredtopreparefinancialstatementsusingtheMFRSFrameworkinitsfirstMFRSfinancialstatements for the year ending 30 April 2013. In presenting its first MFRS financial statements, the Group will be requiredtorestatethecomparativefinancialstatementstoamountsreflectingtheapplicationofMFRSFramework.Themajorityoftheadjustmentsrequiredontransitionwillbemade,retrospectively,againstopeningretainedprofits.

The Group has not completed its assessment of the financial effects of the differences between Financial Reporting Standards and accounting standards under the MFRS Framework. Accordingly, the consolidated financial performance and financial position as disclosed in these financial statements for the year ended 30 April 2012 could be different if prepared under the MFRS Framework.

TheGroupexpectstobeinapositiontofullycomplywiththerequirementsoftheMFRSFrameworkforthefinancialyear ending 30 April 2013.

a. Basis of Preparation

The financial statements of the Group and of the Company have been prepared in accordance with the provisions of the Companies Act, 1965 and applicable FRSs. The financial statements have been prepared under the historical cost convention, except where otherwise stated in the respective accounting policies.

The financial statements are presented in Ringgit Malaysia (“RM”) which is also the Company’s functional currency.

b. Subsidiaries and Basis of Consolidation

(i) Subsidiaries

Subsidiaries are entities over which the Group has the power, directly or indirectly, to exercise control over the financial and operating policies so as to obtain benefits from their activities.

In the Company’s separate financial statements, investments in subsidiaries are stated at cost less impairment losses, if any. On disposal of such investments, the difference between the net disposal proceeds and their carrying amounts is included in the income statement. The policy for the recognition and measurement of impairment losses is in accordance with Note 2(h).




b. Subsidiaries and Basis of Consolidation (cont’d)

(ii) Basis of Consolidation

The consolidated financial statements include the financial statements of the Company and its subsidiaries madeuptotheendofthefinancialyear.Theresultsofthesubsidiariesareconsolidatedusingtheacquisitionmethod.

Undertheacquisitionmethod,subsidiariesareconsolidatedfromthedateonwhichcontrolistransferredtotheGroupandarenolongerconsolidatedfromthedatethatcontrolceases.Thecostofacquisitionismeasured as the aggregate of fair values, at the date of exchange, of the assets given, liabilities incurred orassumed,andequityinstrumentsissued,plusanycostsdirectlyattributabletothebusinesscombination.Identifiableassetsacquired, liabilitiesandcontingent liabilitiesassumed inabusinesscombinationaremeasuredinitiallyattheirfairvaluesattheacquisitiondate,irrespectiveoftheextentofanyminorityinterest.AnydifferencebetweenthecostofacquisitionandtheGroup’sinterestinthenetfairvalueoftheidentifiableassets,liabilitiesandcontingentliabilitiesacquiredisrecognisedasgoodwillornegativegoodwill.Theaccounting policy on goodwill and negative goodwill is disclosed in Note 2(d).

Intragroup transactions, balances and resulting unrealised gains are eliminated on consolidation and the consolidated financial statements reflect external transactions only. Unrealised losses are eliminated on consolidation unless costs cannot be recovered. Consistent accounting policies are applied for transactions and events in similar circumstances.

Minority interest represents the portion of profit or loss and net assets in subsidiaries not held directly or indirectly by the Group. Minority interest is measured at the minority’s share of the fair values of the identifiable assetsandliabilitiesattheacquisitiondateandtheminority’sequitysincethen.

c. Associate

AssociateisanentityinwhichtheGrouphasalongtermequityinterestandvotingrightsofbetween20%and50% to exercise significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the associate but not in control over those policies.

Investmentinassociateisaccountedforintheconsolidatedfinancialstatementsusingtheequitymethod.TheGroup’s investment in associate is recognised in the consolidated balance sheet at cost plus the Group’s share ofpost-acquisitionnetresultsoftheassociatelessimpairmentlosses.Thepolicyfortherecognitionandmeasurement of impairment losses is in accordance with Note 2(h).

The Group’s share of results of the associate is recognised in the consolidated income statement from the date that significant influence commences until the date that significant influence ceases. Any unrealised gains and losses on transactions between the Group and the associate are eliminated to the extent of the Group’s interestintheassociate.WhentheGroup’sshareoflossesinanassociateequalsorexceedsitsinterestintheassociate, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate. Consistent accounting policies are applied for transactions and events in similar circumstances.

Goodwill relating to an associate is included in the carrying amount of the investment and is not amortised. Any excess of the Group’s share of the fair value of the associate’s net identifiable assets 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 results of the associate in the period in which the investmentisacquired.

In the Company’s separate financial statements, investment in associate is stated at cost less impairment losses, if any. On disposal of such investments, the difference between the net disposal proceeds and their carrying amounts is included in the income statement.




d. Goodwill

GoodwillrepresentstheexcessofthecostoftheacquisitionovertheGroup’sinterestinthenetfairvalueoftheidentifiable assets, liabilities and contingent liabilities of the subsidiaries.

Goodwill is measured at cost less accumulated impairment losses, if any. Goodwill is no longer amortised. Instead it is allocated to cash-generating units (“CGUs”) which are expected to benefit from the synergies of the business combination. Each CGU represents the lowest level at which the goodwill is monitored and is not larger than a segment based on either the Group’s primary or secondary reporting format. The carrying amount ofgoodwillistestedannuallyforimpairmentormorefrequentlyifeventsorchangesincircumstancesindicatethat it might be impaired. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

Negative goodwill, which represents the excess of the Group’s interest in the net fair value of the identifiable assets,liabilitiesandcontingentliabilitiesacquiredoverthecostoftheacquisitionofthesubsidiaries,isrecognisedimmediately in the income statement.

e. Foreign Currencies

The individual financial statements of each entity in the Group are measured using their respective functional currency.

(i) Foreign Currency Transactions

In preparing the individual financial statements, transactions in currencies other than the entity’s functional currency (“foreign currencies”) are translated into the functional currencies using the exchange rates prevailing at the dates of the transactions. At each balance sheet date, monetary assets and liabilities denominated in foreign currencies are translated at the rates prevailing on the balance sheet date. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated at the exchange rate prevailing at the date of the initial transaction. Non-monetary items measured at fair value in a foreign currency are translated at exchange rates at the date when the fair value is determined. Exchange differences arising on the settlement of monetary items or on translating monetary items at balance sheet date are recognised in the income statement except for those arising on monetary items that form part of the Group’s net investment in foreign operation.

(ii) Net Investment in Foreign Operations

Exchange differences arising on monetary items that form part of the Group’s net investment in foreign operation, where that monetary item is denominated in either the functional currency of the reporting entity or the foreign operation, are initially taken directly to the foreign currency translation reserve within the equityuntilthedisposaloftheforeignoperation,atwhichtimetheyarerecognisedintheincomestatement.If exchange differences arise in a currency other than the functional currency of either the reporting entity or the foreign operation, such items are recognised in the income statement for the period.

Exchange differences arising on monetary items that form part of the Company’s net investment in foreign operation, regardless of the currency of the monetary item, are recognised in the income statement of the Company or the foreign operation, as appropriate.

(iii) Foreign Operations

The results and financial position of the Group’s foreign operations are translated into presentation currency (RM) as follows:

- Assets and liabilities for each balance sheet presented are translated at the closing rate prevailing atthebalancesheetdate;

- Income and expenses for each income statement are translated at average exchange rates for theyear,whichapproximatestheexchangeratesatthedatesofthetransactions;and

- Allresultingexchangedifferencesaretakentoaforeigncurrencytranslationreservewithinequityandaresubsequentlyrecognisedintheincomestatementupondisposaloftheforeignoperations.




e. Foreign Currencies (cont’d)

(iii) Foreign Operations (cont’d)

Goodwillandfairvalueadjustmentsarisingfromtheacquisitionofaforeignoperationonorafter1January2006 are treated as assets and liabilities of the foreign operation and are translated at the closing rate at thebalancesheetdate.Foracquisitionpriorto1January2006,theexchangeratesasatthedateofinitialacquisitionwereused.

The closing rates used in the translation of foreign currency monetary assets and liabilities and the financial statements of foreign operations are as follows:

2012 2011RM RM

1 United States Dollar (USD) 3.03 2.961 Singapore Dollar (SGD) 2.45 2.421 Chinese Renminbi (RMB) 0.48 0.461 Australia Dollar (AUD) 3.16 3.23100 Thailand Baht (THB) 9.90 9.90100 Hong Kong Dollar (HKD) 39.00 38.111000 Indonesia Rupiah (INR) 0.33 0.35

f. Property, Plant and Equipment and Depreciation

Freehold land and construction work-in-progress are stated at cost and are not depreciated. All other property, plantandequipmentareinitiallyrecordedatcost.Subsequentcostsareincludedintheasset’scarryingamountor recognised as a separate asset, as appropriate, 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. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the income statement when they are incurred.

Subsequenttoinitialrecognition,property,plantandequipmentarestatedatcostlessaccumulateddepreciationand any impairment losses. The policy for the recognition and measurement of impairment losses is in accordance with Note 2(h).

Theannualratesofdepreciationusedforthemajorgroupsofproperty,plantandequipmentareasfollows:

Buildings 2% and 10%Plant and machinery 5% to 10%Officeequipment,furnitureandfittings 5% to 20%Motor vehicles 10% to 20%Mould & die cutters 10%Renovations 10% to 33 1/3 %

The residual values, useful lives and depreciation method are reviewed at each financial year end to ensure that the amount, method and period of depreciation are consistent with previous estimates and the expected pattern of consumptionofthefutureeconomicbenefitsembodiedintheitemsofproperty,plantandequipment.

Anitemofproperty,plantandequipmentisderecognisedupondisposalorwhennofutureeconomicbenefitsare expected from its use or disposal. The difference between the net disposal proceeds, if any, and the net carrying amount is recognised in the income statement.




g. Development Expenditure

Expenditure on development activities, where research findings are applied to a plan or design for the production of new or substantially improved products and processes, is capitalised if the product or process is technically and commercially feasible and the Group has sufficient resources to complete development. The expenditure capitalised includes the cost of materials, direct labour and an appropriate proportion of overheads. Other development expenditure is recognised in the income statement as incurred.

Capitalised development expenditure is stated at cost less accumulated amortisation. These expenditure are amortised and recognised as expenses on systematic basis from the date of commencement of commercial production so as to reflect the pattern in which the related economic benefits are recognised, which are over three (3) to five (5) years.

h. Impairment of Assets

The carrying amount of the Group’s assets, other than investment property and inventories, are reviewed at each balance sheet date to determine whether there are any indications of impairment. If any such indications exist, the asset’s recoverable amount is estimated to determine the amount of impairment loss. The policies on impairmentofassetsaresummarizedasfollows:

i) Goodwill

Goodwillthathasanindefiniteusefullifeistestedannuallyforimpairmentormorefrequentlyifeventsorchanges in circumstances indicate that it might be impaired. For impairment testing, goodwill from business combinations is allocated to CGUs which are expected to benefit from the synergies of the business combination.

The recoverable amount is determined for each CGU based on its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. An impairmentlossisrecognizedintheincomestatementwhenthecarryingamountoftheCGU,includingthe goodwill, exceeds the recoverable amount of the CGU. The total impairment loss is allocated, first, to reduce the carrying amount of goodwill allocated to the CGU and then to the other assets of the CGU on apro-ratabasis.Animpairmentlossongoodwillisnotreversedinsubsequentperiods.

ii) Impairment of non-financial assets

Assetssuchasproperty,plantandequipmentarereviewedforobjectiveindicationsofimpairmentateachstatement of financial position date or whenever there is any indication that these assets may be impaired. Where such indications exist, impairment loss is determined as the excess of the asset’s carrying value overitsrecoverableamount(greaterofvalueinuseorfairvaluelesscoststosell)andisrecognizedinthestatementofcomprehensiveincome.Anyreversalofanimpairmentlossfortheseassetsisrecognizedin the statement of comprehensive income. The carrying amount is increased to its revised recoverable amount, provided that the amount does not exceed the carrying amount that would have been determined (netofamortizationordepreciation)hadnoimpairmentlossbeenrecognizedfortheassetinprioryears.

If an asset is carried at a revalued amount, impairment loss is treated as a revaluation decrease to the extentofpreviouslyrecognisedrevaluationsurplusforthesameasset.Anysubsequentreversalistreatedas a revaluation increase.

iii) Impairment of financial assets

The Group and the Company assess at each reporting date whether there is any objective evidence that a financial asset is impaired.

To determine whether there is objective evidence that an impairment loss on financial assets has been incurred, the Group and the Company consider factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments.




h. Impairment of Assets (cont’d)

(iii) Impairment of financial assets (con’d)

If any such evidence exists, the amount of impairment loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the financial asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

The carrying amount of trade and other receivables is reduced by the impairment loss through the use of an allowance account. When the receivable becomes uncollectible, it is written off against the allowance account.

Ifinasubsequentperiod,theamountoftheimpairmentlossdecreasesandthedecreasecanberelatedobjectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed to the extent that the carrying amount of the asset does not exceed its amortised cost at the reversed date. The amount of reversal is recognised in profit or loss.

i. Leases

(i) Finance Leases

AssetsacquiredunderhirepurchaseorfinanceleasewheretheCompanyassumessubstantiallyallthebenefitsandrisksofownershipareclassifiedasproperty,plantandequipment.

Finance leases are capitalised at the inception of the lease at the lower of the fair value of the leased assets and the present value of the minimum lease payments. Each lease payment is allocated between the liability and finance charges so as to achieve a periodic constant rate of interest on the remaining balance. The corresponding rental obligations, net of finance charges, are included in borrowings. The interest element of the finance charge is charged to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

(ii) Operating Leases

All other leases are classified as operating leases. Lease payments under operating lease are recognised as expense in the income statement on a straight line basis over the lease term.

j. Financial Assets

Financial assets are recognised in the statements of financial position when, and only when, the Group and the Company become a party to the contractual provisions of the financial instrument. When financial asets are recognised initially, they are measured at fair value, plus, in the case of financial assets not at fair value through profit or loss, directly attributable transaction costs.

The Group and the Company determine the classification of their financial assets at initial recognition, and the categories include financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments and available-for-sale financial assets.

(a) Financial assets at fair value through profit or loss

Financial assets are classified as financial assets at fair value through profit or loss if they are held for trading or are designated as such upon initial recognition. Financial assets held for trading are derivatives (includingseparatedembeddedderivatives)orfinancialassetsacquiredprincipallyforthepurposeofsellingin the near term.

Subsequenttoinitialrecognition,financialassetsatfairvaluethroughprofitorlossaremeasuredatfairvalue. Any gains or losses arising from changes in fair value are recognised in profit or loss. Net gains or net losses on financial assets at fair value through profit or loss do not include exchange differences, interest and dividend income. Exchange differences, interest and dividend income on financial assets at fair value through profit or los are recognised separately in profit or loss as part of other losses or other income.




j. Financial Assets (cont’d)

(a) Financial assets at fair value through profit or loss (cont’d)

Financial assets at fair value through profit or loss could be presented as current or non-current. Financial assets that are held primarily for trading purposes are presented as current whereas financial assets that are not held primarily for trading purposes are presented as current or non-current based on the settlement date.

(b) Loans and receivables

Financialasetswithfixedordeterminablepaymentsthatarenotquotedinanactivemarketareclassifiedas loans and receivables.

Subsequentto initialrecognition, loansandreceivablesaremeasuredatamortisedcostusingtheeffectiveinterest method. Gains and losses are recognised in profit or loss when the loans and receivables are derecognised or impaired, and through the amortisation process.

Loans and receivables are classified as current assets, except for those having maturity dates later than 12 months after the reporting date which are classified as non-current.

(c) Held-to-maturity investments

Financial assets with fixed or determinable payments and fixed maturity are classified as held-to-maturity when the Group has the positive intention and ability to hold the investment to maturity.

Subsequenttoinitialrecognition,held-to-maturityinvestmentsaremeasuredatamortisedcostusingtheeffective interest method. Gains and losses are recognised in profit or los when the held-to-maturity investments are derecognised or impaired, and through the amortisation process.

Held-to-maturity investments are classified as non-current assets, except for those having maturity within 12 months after the reporting date which are classified as current.

(d) Available-for-sale financial assets

Available-for-sale financial assets are financial assets that are designated as available for sale or are not classified in any of the three preceding categories.

After initial recognition, available-for-sale financial assets are measured at fair value. Any gains or losses from changes in fair value of the financial assets are recognised in other comprehensive income, except that impairment losses, foreign exchange gains and losses on monetary instruments and interest calculated using the effective interest method are recognised in profit or loss. The cumulative gain or loss previously recognisedinothercomprehensiveincomeisreclassifiedfromequitytoprofitorlossasareclassificationadjustment when the financial asset is derecognised. Interest income calculated using the effective interest methodisrecognisedinprofitorloss.Dividendsonanavailable-for-saleequityinstrumentarerecognisedin profit or loss when the Group’s and the Company’s right to receive payment is established.

Investmentsinequityinstrumentswhosefairvaluecannotbereliablymeasuredaremeasuredatcostlessimpairment loss, if any.

Available-for-sale financial assets are classified as non-current assets unless they are expected to be realised within 12 months after the reporting rate.

A financial asset is derecognised when the contractual right to receive cash flows from the asset has expired. On derecognition of a financial aset in its entirety, the difference between the carrying amount and the sum of the consideration received and any cumulative gain or loss that had been recognised in other comprehensive income is recognised in profit or loss.

Regularwaypurchasesorsalesarepurchasesorsalesoffinancialassetsthatrequiredeliveryofassetswithinthe period generally established by regulation or convention in the marketplace concerned. All regular way purchases and sales of financial assets are recognised or derecognised on the trade date i.e., the date that the Group and the Company commit to purchase or sell the asset.




k. Financial Liabilities

Financial liabilities are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability.

Financial liabilities, within the scope of FRS 139, are recognised in the statement of financial position when, and only when, the Group and the Company become a party to the contractual provisions of the financial instrument. Financial liabilities are classified as either financial liabilities at fair value through profit or loss or other financial liabilities.

(a) 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 held for trading include derivatives entered into by the Group and the Company that do not meet the hedge accounting criteria. Derivative liabilities are initially measured at fair value and subsequentlystatedatfairvalue,withanyresultantgainsorlossesrecognisedinprofitorloss.Netgainsor losses on derivatives include exchange differences.

(b) 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 andsubsequentlymeasuredatamortisedcostusingtheeffectiveinterestmethod.

Loans and borrowings are recognised initially at fair value, net of transaction costs incurred, and subsequentlymeasuredatamortisedcostusingtheeffectiveinterestmethod.Borrowingsareclassifiedas curent liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

For other financial liabilities, gains and losses are recognised in profit or loss when the liabilities are derecognised, and through the amortisation process.

A financial liability is derecognised when the obligation under the liability is extinguished. 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 a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in profit or loss.

l. Revenue Recognition

Revenue is recognised when it is probable that the economic benefits associated with the transaction will flow to the enterprise and the amount of the revenue can be measured reliably.

(i) Sales of Goods

Revenue from sales of goods is measured at the fair value of the consideration receivable and is recognised in the income statement when the significant risks and rewards of ownership have been transferred to the customers.

(ii) Interest Income

Interest is recognised on an accrual basis that reflects the effective yield on the asset.




m. Employee Benefits

(i) Short Term Benefits

Wages, salaries, bonuses and allowances are recognised as expenses in the year in which the associated services are rendered by employees of the Company. 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, and short term non-accumulating compensated absences such as sick leave are recognised when the absences occur.

(ii) Defined Contribution Plans

Obligations for contributions to defined contribution plans such as the Employees Provident Fund (“E.P.F.”) are recognised as an expense in the income statement as incurred.

n. Income Tax

Income tax on the profit or loss for the year comprises current and deferred tax. Current tax is the expected amount of income taxes payable in respect of the taxable profit for the year and is measured using the tax rates that have been enacted at the balance sheet date.

Deferred tax is provided for, using the liability method, on temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts in the financial statements. In principle, deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, unused tax losses and unused tax credits can be utilised. Deferred tax is not recognised if the temporary difference arises from goodwill or negative goodwill or from the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction, affects neither accounting profit nor taxable profit.

Deferred tax is measured at the tax rates that are expected to apply in the period when the asset is realised or the liability is settled, based on tax rates that have been enacted or substantively enacted at the balance sheet date. Deferred tax is recognised in the income statement, except when it arises from a transaction which isrecogniseddirectlyinequity,inwhichcasethedeferredtaxisalsochargedorcrediteddirectlyinequity,orwhenitarisesfromabusinesscombinationthatisanacquisition,inwhichcasethedeferredtaxisincludedinthe resulting goodwill or negative goodwill.

o. Critical Judgments Made in Applying Accounting Policies

Inthepreparationofthefinancialstatements,managementhasbeenrequiredtomakejudgments,estimatesand assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the financial statements in the period in which the estimate is revised and in any future periods affected.

In the process of applying the accounting policies as described above, management is of the view that there are no instances of application of judgments which are expected to have significant effect on the amounts recognised in the financial statements.



3. PROPERTY, PLANT AND EQUIPMENT

As at Addition/ Disposal/ Exchange As at 01.05.2011 Transfer Write off differences 30.04.2012

RM’000 RM’000 RM’000 RM’000 RM’000 Group2012

COSTFreehold land 11,656 327 (6,546) - 5,437 Buildings 33,445 - (1,340) 494 32,599 Plant and machinery 149,951 6,005 (1,520) 3,019 157,455 Officeequipment,furniture and fittings 9,303 370 (83) 167 9,757 Motor vehicles 2,141 - (403) 39 1,777 Mould & die cutters 14,465 754 - 455 15,674 Renovations 5,682 28 - 101 5,811

226,643 7,484 (9,892) 4,275 228,510

As at Charge for Disposal/ Exchange As at 01.05.2011 the year Write off differences 30.04.2012

RM’000 RM’000 RM’000 RM’000 RM’000 ACCUMULATED DEPRECIATIONFreehold land - - - - - Buildings 6,032 702 (281) 67 6,520 Plant and machinery 64,555 7,964 (775) 1,227 72,971 Officeequipment,furniture

and fittings 7,755 411 (83) 160 8,243 Motor vehicles 1,865 135 (315) 34 1,719 Mould & die cutters 7,338 1,596 - 250 9,184 Renovations 3,931 438 - 91 4,460

91,476 11,246 (1,454) 1,829 103,097

As at

30.04.2012

RM’000

Net Book Value

Freehold land 5,437

Buildings 26,079

Plant and machinery 84,484

Officeequipment,furnitureandfittings 1,514

Motor vehicles 58

Mould & die cutters 6,490 Renovations 1,351

125,413



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

As at Addition/ Disposal/ Exchange As at 01.05.2010 Transfer Write off differences 30.04.2011

RM’000 RM’000 RM’000 RM’000 RM’000

2011(Restated)

COST

Freehold land 11,580 76 - - 11,656 Buildings 33,687 - - (242) 33,445 Plant and machinery 143,506 8,620 (731) (1,444) 149,951 Officeequipment,furnitureandfittings 9,283 149 (60) (69) 9,303Motor vehicles 2,167 128 (145) (9) 2,141 Mould & die cutters 13,671 1,000 (1) (205) 14,465 Renovations 5,736 - - (54) 5,682

219,630 9,973 (937) (2,023) 226,643

As at Charge for Disposal/ Exchange As at 01.05.2010 the year Write off differences 30.04.2011

RM’000 RM’000 RM’000 RM’000 RM’000

ACCUMULATED DEPRECIATION

Freehold land - - - - - Buildings 5,362 703 - (33) 6,032 Plant and machinery 57,511 7,893 (211) (638) 64,555 Officeequipment,furnitureandfittings 7,458 428 (58) (73) 7,755 Motor vehicles 1,848 170 (145) (8) 1,865 Mould & die cutters 5,974 1,484 - (120) 7,338 Renovations 3,490 491 - (50) 3,931

81,643 11,169 (414) (922) 91,476

As at 30.04.2011

RM’000 Net Book ValueFreehold land 11,656 Buildings 27,413 Plant and machinery 85,396 Officeequipment,furnitureandfittings 1,548Motor vehicles 276 Mould & die cutters 7,127 Renovations 1,751

135,167



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

Thenetbookvalueof thebuildingof thesubsidiary,GuangzhouKomarkLabels&LabellingCo.,Ltd.amounting toRM1,129,000 (2011: RM1,107,000) is built on a piece of land belonging to and leased from the authority of the People’s Republic of China. The lease term is due to expire in the year 2044.

ThenetbookvalueofplantandmachineryandmotorvehiclesoftheGroupacquiredunderhirepurchaseagreementsamounted to RM13,015,000 (2011: RM19,917,000) and RM36,000 (2011: RM529,000) respectively.

Freehold land, buildings and plant and machinery of the Group amounting to RM5,425,000 (2011: RM11,568,000), RM18,923,000 (2011: RM20,388,000) and RM22,918,000 (2011: RM21,800,000) respectively are charged to licensed banks and financial institutions as security for borrowings granted to certain subsidiaries (Note 19).

4. PREPAID LEASE PAYMENTS FOR LAND

Group

2012 2011RM’000 RM’000

Cost 1,890 1,890

Accumulated amortisationAt 1 May (220) (178)Charge for the year (43) (42)

At 30 April (263) (220)

Exchange differences 74 (12)

Net carrying amount 1,701 1,658

Leasehold land of the Group has been pledged as security to financial institution for banking facilities granted to the Group.

5. INVESTMENT PROPERTY

Group

2012 2011RM’000 RM’000

Cost 337 337

Accumulated depreciationAt 1 May 142 142 Change for the year 5 -

At 30 April 147 142

Net carrying amount 190 195

The investment property is pledged as security to financial institution for banking facilities granted to the Group.

6. INVESTMENTS IN SUBSIDIARIES

Company2012 2011

RM’000 RM’000

Unquotedshares,atcost 31,683 31,683



6. INVESTMENTS IN SUBSIDIARIES (Cont’d)

The list of subsidiaries, their places of incorporation, their principal activities and the effective interest of the Company are as follows:

Country of EffectiveName of Company incorporation Principal activities equity interest

2012 2011% %

General Labels & Labelling (M) Sdn. Bhd.

Malaysia Manufacturing of self adhesive labels and automatic labelling machines and trading of relatedtoolsandequipment

100 100

Komark International (M) Sdn. Bhd.

Malaysia Manufacturing of self adhesive labels and trading of relatedtoolsandequipment

100 100

*# General Labels & Labelling (Penang) Sdn. Bhd.


100 100

General Labels & Labelling (Ipoh) Sdn. Bhd.


100 100

^ Komark Investment Holdings Ltd.

British VirginIsland

Investment holding 100 100

^ Komark Australasia Pty Ltd. Australia Dormant 100 100

^ Komark China Ltd. Caymans Island

Dormant 100 100

General Labels & Labelling (JB) Sdn. Bhd.


100 100

* General Labels & Labelling Pte. Ltd.

Singapore Manufacturing of self adhesive labels and trading of relatedtoolsandequipment

100 100

* Komark (Thailand) Co. Ltd. Thailand Manufacturing of self adhesive labels

100 100

The subsidiaries of Komark Investment Holdings Ltd. are as follows:

Name of CompanyCountry ofincorporation Principal activities

Effectiveequity interest

2012 2011% %

* Shanghai Komark Labels & Labelling Co. Ltd.

People’sRepublic of China

Manufacturing of self adhesive labels and trading of labelling machines

100 100

* GuangzhouKomark Labels & Labelling Co. Ltd.

People’sRepublic of China

Manufacturing of self adhesive labels

100 100



6. INVESTMENTS IN SUBSIDIARIES (Cont’d)

The subsidiaries of Komark Investment Holdings Ltd. are as follows: (cont’d)


Effective equity interest

2012 2011% %

*# Komark Hong Kong Co.Ltd.

Hong Kong Dormant 100 100

The subsidiaries of Komark International (M) Sdn. Bhd. is as follow:



2012 2011% %

* PT Komark Labels and Labelling Indonesia

Indonesia Manufacturing and trading of self adhesive labels

100 100

* Audited by another firm of auditors.^ Consolidated based on management financial statements as at 30 April 2012 in which we have reviewed for

consolidation purposes.# Subsidiarywithauditor’sreportthatisnotqualifiedwhichcontainedanemphasisofmatteronitsgoing

concern, which is dependent upon continuous financial support of its holding or ultimate holding company.

7. INVESTMENT IN ASSOCIATE

Group

2012 2011RM’000 RM’000

Unquotedshares,atcost 2 2Shareofpostacquisitionresults (2) (2)

- -

Represented by:Group’s share of net assets - -

The shares of the associate are held directly by one of the subsidiaries, namely Komark International (M) Sdn. Bhd. Details of the associate are as follows:



2012 2011% %

* Komark Enterprise Co. Ltd.

Thailand Trading of self adhesive labels and related toolsandequipment

49 49

* Audited by another firm of auditors.

8. OTHER INVESTMENT

Group

2012 2011RM’000 RM’000

Quoted shares in Malaysia, at cost 4 4

Quoted shares in Malaysia, at market value 3 3



9. DEVELOPMENT EXPENDITURE

Group

2012 2011RM’000 RM’000

Automatic labelling machineriesCostAt 1 May 3,343 3,237 Addition during the year 2,231 106

At 30 April 5,574 3,343

Accumulated amortisationAt 1 May 2,982 2,711 Charge for the year 196 271

At 30 April 3,178 2,982

Net book value 2,396 361

Roto-gravure/offset combination labels press project

CostAt 1 May 3,241 3,321 Addition during the year 266 - Exchange difference (100) (80)

At 30 April 3,407 3,241

Accumulated amortisationAt 1 May 3,092 3,066 Charge for the year 161 102 Exchange difference (106) (76)

At 30 April 3,147 3,092

Net book value 260 149

Total net book value 2,656 510

The roto-gravure/offset combination labels press commenced its commercial production in December 2002. The amortisation represents the amount charged from the date of commercial production.



10. GOODWILL ON CONSOLIDATION

Group

2012 2011RM’000 RM’000

Goodwill on consolidation

Amountrecognisedonacquisitions 2,413 2,413 Accumulated amortisation (663) (663)

Net book value 1,750 1,750

Negative goodwill amounting to RM7,195,813 has been fully amortised and recognised in the income statement in the previous financial year. Goodwill on consolidation is no longer amortised since financial year 2007, instead it is subject to impairment. There is no impairment as at the end of current financial year.

11. INVENTORIES

Group

2012 2011RM’000 RM’000

Raw materials 12,337 14,244 Work-in-progress 3,496 4,704 Manufactured inventories 20,383 18,113 Others 3,302 2,606

39,518 39,667 Less : Allowance for slow-moving manufactured inventories (1,495) (2,675)

38,023 36,992

12. RECEIVABLES

Group Company2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000(Restated)

Trade receivables - Third parties 32,322 28,380 - -

- Associated company 2,132 1,783 - -

34,454 30,163 - - Less: Allowance for

impairment (1,484) (1,296) - -

Trade receivables, net 32,970 28,867 - -

Other receivables, deposits and prepayment 5,780 6,238 54 50

38,750 35,105 54 50

Trade receivables aging analysis:- 1 - 90 days 25,566 21,371 - - - 91 - 180 days 2,807 2,491 - - - 181 days and above 4,597 5,005 - -

32,970 28,867 - - Impaired 1,484 1,296 - -

34,454 30,163 - -



12. RECEIVABLES (Cont’d)

Trade receivables are non-interest bearing and are generally on 1 to 120 (2011: 1 to 120) days terms.

Trade receivables that are neither past due nor impaired are creditworthy debtors with good payment records with the Group.

At the reporting date, trade receivables that are past due but not impaired are mainly unsecured in nature. Based on their payment history, the Group believes that these debts should be recovered without material losses in the ordinary course of business.

13. AMOUNT DUE FROM/(TO) RELATED COMPANIES

These balances are non-trade in nature, unsecured and interest free.

14. CASH AND BANK BALANCES

Group Company2012 2011 2012 2011

RM'000 RM'000 RM'000 RM'000(Restated)

Deposits with licensed banks 669 2,368 - - Cash in hand and at bank 5,497 3,512 3 3

6,166 5,880 3 3

Included in deposits placed with licensed banks of the Group is RM630,520 (2011: RM2,330,000) amount pledged as security for borrowings granted to subsidiaries (Note 18).

15. SHARE CAPITAL

Group and company

2012 2011RM’000 RM’000

Ordinary shares of RM1.00 each

Authorised: At 1 May/30 April 500,000 500,000

Issued and fully paid At 1 May/30 April 81,275 81,275

16. TREASURY SHARES

Group

2012 2011Number of ordinary shares of RM1.00 each At 1 May 1,536,000 1,534,000 Repurchased during the year 2,000 2,000 At 30 April 1,538,000 1,536,000



16. TREASURY SHARES (Cont’d)

Group

2012 2011RM’000 RM’000

Ordinary shares of RM1.00 each At 1 May 437 436 Repurchased during the year -# 1

At 30 April 437 437


During the financial year, the Company repurchased 2,000 (2011: 2,000) ordinary shares from the open market at an average price of RM0.32 (2011: RM0.29) per share. The total consideration paid for the repurchase was RM637 (2011: RM577). The repurchased transactions were financed by internally generated funds.

TheremainingrepurchasedsharesareheldastreasurysharesinaccordancewiththerequirementofSection67Aofthe Companies Act, 1965.

17. RESERVES

Group Company2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Non-distributable

General reserveAt 1 May 1,703 1,703 - - Transfer from retained profits - - - -

At 30 April 1,703 1,703 - -

Translation reserveAt 1 May 2,218 2,486 - - Foreign currency translation 1,512 (268) - -

At 30 April 3,730 2,218 - -

Total non-distributable reserves 5,433 3,921 - -

Distributable

Retained profits/ (Accumulated losses)

(Accumulated losses)

At 1 May 18,263 16,148 (25,758) (22,751)Profit/(Loss) for the year 79 2,115 (2,599) (3,007)

At 30 April 18,342 18,263 (28,357) (25,758)

Total Reserves 23,775 22,184 (28,357) (25,758)



17. RESERVES (Cont’d)

a. General Reserve

SubsidiariesinthePeople’sRepublicofChina(“PRC”)arerequiredtoappropriate10%oftheirafter-taxprofit(after offsetting prior year losses), based on the respective PRC statutory financial statements, to a general reserve fund until the balance of the fund reaches 50% of the Company’s registered capital. Thereafter, any further appropriation can be made at the Directors’ discretion.

The general reserve fund can be utilised to offset prior year losses, or be utilised for the issuance of bonus shares on the condition that the general reserve fund shall be maintained at a minimum of 25% of the registered capital after such issuance.

In accordance with the relevant rules and regulations in the PRC, the subsidiaries may also appropriate a portion of its after-tax profit (after offsetting prior year losses), based on the PRC statutory financial statements, to an enterprise expansion fund and a staff and workers’ bonus and welfare fund at the Director’s discretion. No such appropriation has been made in the current and previous year.

b. Translation Reserve

This represents foreign currency exchange differences arising from the translation of the financial statements of subsidiaries which are denominated in currency other than the presentation currency of the Company, Ringgit Malaysia.

c. Additional Disclosure of realised and unrealised profits or losses

Group Company2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Total retained profits/(accumulated losses) of the Companyand its subsidiary companies

- Realised 26,077 25,716 (28,357) (25,758)- Unrealised (1,532) (1,236) - -

24,545 24,480 (28,357) (25,758)

Total share of accumulated losses from associated company

- Realised (2) (2) - - - Unrealised - - - -

24,543 24,478 (28,357) (25,758)

Less: Consolidation adjustments (6,201) (6,215) - -

Total Group/Company retained profits/(accumulated losses) as perconsolidated accounts 18,342 18,263 (28,357) (25,758)



18. BORROWINGS

Group Company2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Current

Bank overdrafts - secured 12,756 16,034 2,988 2,987 - unsecured 7,287 5,276 - -

Bankers’ acceptances - secured 12,185 15,334 - - - unsecured 1,117 1,312 - -

Term loans - secured 3,024 3,604 - - Short-term loans - secured 1,990 - - -

- unsecured 11,039 10,797 - - Hire purchase liabilities 3,471 3,223 - -

52,869 55,580 2,988 2,987

Non-currentTerm loans - secured 7,117 11,427 - -

- unsecured 452 1,043 - - Hire purchase liabilities 5,581 7,660 - -

13,150 20,130 - -

66,019 75,710 2,988 2,987

a. Term loans and repayment schedule

(i) Secured term loans

Secured term loans consist of 6 (2011: 5) term loans. Their repayment schedule is as follows:

Secured term loan of RM1,398,000 [equivalent to RMB2,915,000] (2011: RM3,876,000 [equivalent toRMB8,497,000]) isobtainedbya foreignsubsidiary froma foreignbank.This is repayablebyquarterlyinstalments over a period of five (5) years commencing May 2008.

SecuredtermloanofRM283,000(2011:RM1,383,000)isrepayablein60monthlyequalinstalmentscommencing February 2008. This term loan is obtained by a local subsidiary from a local bank.

Secured term loan of RM5,586,000 (2011: RM7,499,000) is repayable by 48 consecutive instalments commencing in February 2011. This term loan is obtained by a local subsidiary from a local bank.

Secured term loanofRM1,107,000 (2011:RM2,219,000) is repayable in48monthlyequal instalmentscommencing March 2011. This term loan is obtained by a local subsidiary from a local bank.

Additional secured term loan of RM1,767,000 [equivalent to RMB3,685,000] is repayable by quarterlyinstalments over a period of four (4) years commencing February 2012. This term loan is obtained by a foreign subsidiary from a foreign bank.

Additionalsecuredshort-termloanofRM1,990,000[equivalenttoRMB4,150,000]isrepayablewithinone(1) year commencing March 2012. This short-term loan is obtained by a foreign subsidiary from a foreign bank.

SecuredtermloansamountingtoRM54,000[equivalenttoTHB541,000]asattheendofpreviousfinancialyear have been fully settled during the current financial year.



18. BORROWINGS (Cont’d)

a. Term loans and repayment schedule (Cont’d)

(ii) Unsecured term loans

Unsecured term loans consist of 4 (2011: 3) term loans. Their repayment schedule is as follows:

UnsecuredtermloanofRM1,448,000[equivalenttoRMB3,017,000] (2011:RM9,026,000[equivalenttoRMB19,786,000]) has no fixed repayment period for this term loan.

Additionalunsecuredshort-termloanofRM7,194,000[equivalenttoRMB15,000,000]isrepayablewithinone (1) year commencing May 2011. This short-term loan is obtained by a foreign subsidiary from foreign bank.

Additionalunsecuredshort-termloanofRM2,398,000[equivalenttoRMB5,000,000]isrepayablewithinone (1) year commencing June 2011. This short-term loan is obtained by a foreign subsidiary from foreign bank.

Unsecured term loan of RM452,000 [equivalent to RMB941,000] (2011: RM1,043,000 [equivalent toRMB2,175,000]) is repayable in a period of five (5) years commencing September 2007. This term loan is obtained by a foreign subsidiary from a foreign bank.

Unsecuredshort-termloanofRM912,000[equivalenttoRMB2,000,000]andRM859,000[equivalenttoRMB1,793,000] as at the end of previous financial year have been fully settled during the current financial year.

b. Significant covenants for term loans granted to foreign subsidiaries

In connection with the borrowing facilities agreements and their supplemental agreements, foreign subsidiaries have agreed on the following significant covenants with the lender:

i) the subsidiary shall maintain a minimum net worth of RMB60,000,000 at April 2012 and at anytime thereafter, wherenetworthshallincludepaid-upcapital,shareholdersloansandretainedprofitsatanytime;

ii) the ratio of the subsidiary’s total liabilities to net worth shall not exceed 125% at 30 April 2012 and at anytime thereafterwithoutpriorconsentofthelenders;

iii) the ratio of the subsidiary’s total current assets to total current liabilities (excluding loans from related companies) shall not be below 80% as at 30 April 2012 and at anytime thereafter.

iv) not to make any advances, loans or grant any credit (save in the ordinary course of business) to or for the benefit of any other persons (including any related company) or give any guarantee or indemnity to or for the benefit of any other person or otherwise voluntarily assume any liability, whether actual or contingent, in respect of any obligation of any other person without prior consent of the lenders. The foreign subsidiary shallnotifythelendersontheratioofsaidguarantees,ifanyoveritsnettangibleassets;and

v) not to raise any additional financing from other financial institutions without prior consent from the lenders and such consent shall not be unreasonably withheld.

c. Other borrowings

The Company’s bank overdraft facility is secured by a second legal charge for RM3 million over certain land and building of the Group.

The Group’s other borrowings are secured by way of fixed charges over the freehold land and buildings of the respective subsidiaries, a negative pledge over a subsidiary’s entire present and future assets, corporate guarantees from the Company and fixed deposits of respective subsidiaries.



18. BORROWINGS (Cont’d)

d. Hire purchase liabilities Group2012 2011

RM’000 RM’000

Minimum payment - not later than one year 4,016 3,705 - later than one year and not later than five years 6,429 8,037

10,445 11,742 Future finance charges on hire purchase (1,393) (859)

Present value of hire purchase payables 9,052 10,883

Current 3,471 3,223 Non-current 5,581 7,660

9,052 10,883

Present value of hire purchase payables- not later than one year 3,471 3,223 - later than one year and not later than five years 5,581 7,660

9,052 10,883

Hire purchase liabilities are subject to effective interest rate of 2.19% to 6.30% (2011: 2.19% to 5.19%).

19. DEFERRED TAX

Group2012 2011

RM’000 RM’000

Deferred tax liabilities

At 1 May 1,525 1,846 Transfer to income statement (Note 23) (119) (321)

At 30 April 1,406 1,525

Deferred tax liabilities and assets are offset where there is a legally enforceable right to set off current tax assets against current tax liabilities and where the deferred taxes relate to the same taxation authority and same entity.

The net deferred tax liabilities/(assets) are in respect of the followings:

Group2012 2011

RM’000 RM’000

Taxable temporary differences 4,852 5,369 Allowances (311) (324)Unabsorbed capital allowances (2,093) (2,847)Unutilised tax losses (535) (545)Others (507) (128)

1,406 1,525



20. PAYABLES

Group Company2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Trade payables 17,306 12,548 - - Other payables and accrued expenses 8,947 7,870 627 761

26,253 20,418 627 761

Included in the payables of the Group is an amount of RM35,000 (2011: RM27,000) due to directors. This balance is unsecured, interest free and has no fixed terms of repayment.

21. OTHER OPERATING INCOME

Group Company2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Gain on disposal of property, plantandequipment 289 164 - - Gain on foreign exchange - Realised 222 119 - - - Unrealised - 289 - - Interest income 70 73 - - Rental income 20 61 - - Others 182 203 - -

783 909 - -


22. PROFIT/(LOSS) BEFORE TAX

The following items have been charged in arriving at profit/(loss) before tax:

Group Company2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Amortisation of development expenditure 357 373 - -Amortisation of prepaid lease payments on land 43 42 - -Auditors’ remuneration- Current year’s provision 116 117 14 14- Underprovision in prior years 1 - - -Bad debts written off 92 - - -Depreciation of property, plant andequipment 11,251 11,169 - -Directors’ remuneration- Fees 679 181 75 155- Other emoluments - Directors of the Company 1,801 1,821 1,535 1,821 - Other directors of subsidiary 312 292 - -Finance costs- Bank overdrafts 1,342 1,346 256 245- Hire purchase and finance lease 842 1,049 - -- Short term borrowings 835 938 - -- Term loans 1,758 1,461 - -- Others 5 - - -Loss on foreign exchange- Realised 120 435 - -- Unrealised 125 - - -Factory Rental 589 584 - -Rentalofequipment 11 10 - -Rental of premises 708 445 - -Staff costs- Salaries, allowances and others 16,902 14,523 241 236- Retirement benefits 1,233 838 128 122



23. TAX EXPENSE

Group Company2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Current tax expense Malaysian - Current 44 95 - - - Under/(over) provision in prior year 15 (4) - - Overseas - Current 855 1,015 - - - Overprovision (44) - - -

870 1,106 - - Deferred tax income (Note 19) (119) (321) - -

751 785 - -

Reconciliation of effective tax expense:

Profit/(loss) before tax 830 2,900 (2,594) (3,007)

Income tax using Malaysian tax rates 207 725 (649) (752)Effect of different tax rates in foreign jurisdictions (5) (30) - - Non-deductible expenses 1,797 1,443 649 752 Non-taxable income (445) (448) - - Effect of deferred tax assets not recognised (711) (705) - - Effect of utilisation of reinvestment allowance (63) (196) - -

780 789 - - Overprovision in prior years (29) (4) - -

Tax expense 751 785 - -



24. EARNINGS PER SHARE

Thebasicearningspershare iscalculatedbydividingprofitfortheyearattributabletoequityholdersoftheCompany by the weighted average number of ordinary shares of RM1.00 each in issue during the financial year excluding the weighted average treasury shares held by the Company.

Group2012 2011

RM’000 RM’000

Profitfortheyearattributabletoequityholders of the Company 79 2,115

Number of ordinary shares in issue at 1 May 79,739 79,741 Effect of shares bought back and held as treasury shares (1) (2)

79,738 79,739

Basic earnings per share (sen) 0.1 2.7

There was no dilution of earnings per share during the financial year.

25. SEGMENT INFORMATION

Segmental information is presented in respect of the Group’s business and geographical segments based on the Groups management and internal reporting structure.

Inter-segment pricing is determined based on negotiated basis in the normal course of business.

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items mainly comprise of expenses and assets of the Company and its dormant subsidiaries.

Business Segment

The Group comprises the following main business segments:

i) Manufacturingofselfadhesivelabelsandstickersandtradingofrelatedproducts;and

ii) Manufacturing of automatic labelling machineries.

Geographical segments

Manufacturing of automatic labelling machineries is principally operated in Malaysia. Other geographical areas are involved in the manufacturing of self adhesive labels and stickers and trading of related products.

In presenting information on the basis of geographical segments, segment revenue and segment assets are based on the geographical location of assets.



25. SEGMENT INFORMATION (Cont’d)

a. Business Segment

Manufacturing of self adhesive labels and

stickers and trading of related product

Manufacturing of automatic

labellingmachineries Elimination Consolidation

RM’000 RM’000 RM’000 RM’000

2012

RevenueExternal sales 121,742 1,604 - 123,346 Inter-segment sales - 1,411 (1,411) -

Total revenue 121,742 3,015 (1,411) 123,346

ResultsSegment results 7,465 482 - 7,947 Unallocated expenses (2,405)Interest income 70

Profit from operations 5,612 Finance costs (4,782)

Profit before tax 830 Tax expense (751)

Profit for the year 79 Minority interest -

Profitattributabletoequity holders of the Company 79

AssetsSegment assets 178,416 36,237 - 214,653 Unallocated assets 140

Total Assets 214,793

LiabilitiesSegment liabilities 91,045 1,227 - 92,272 Unallocated liabilities 2,619

Total Liabilities 94,891 Other InformationCapital expenditure (9,981) - (9,981)Depreciation and amortisation (11,215) (436) (11,651)



25. SEGMENT INFORMATION (Cont’d)

a. Business Segment (Cont’d)

Manufacturing of self adhesive labels and

stickers and trading of related product

Manufacturing of automatic

labellingmachineries Elimination Consolidation

RM’000 RM’000 RM’000 RM’000

2011

RevenueExternal sales 112,592 376 - 112,968 Inter-segment sales - 1,588 (1,588) -

Total revenue 112,592 1,964 (1,588) 112,968

ResultsSegment results 10,333 49 - 10,382 Unallocated expenses (2,762)Interest income 73

Profit from operations 7,693 Finance costs (4,793)

Profit before tax 2,900 Tax expense (785)

Profit for the year 2,115 Minority interest -

Profitattributabletoequity holders of the Company 2,115

AssetsSegment assets 188,739 28,522 - 217,261 Unallocated assets 53

Total Assets 217,314

LiabilitiesSegment liabilities 94,052 2,076 - 96,128 Unallocated liabilities 2,875

Total Liabilities 99,003 Other InformationCapital expenditure (10,079) - (10,079)Depreciation and amortisation (11,188) (396) (11,584)




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26. CONTINGENT LIABILITIES

Group2012 2011

RM’000 RM’000

Corporate guarantees in respect of credit facilities granted to subsidiaries 72,000 112,854

27. SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES

Controlling related party relationships are as follows:

i) Its subsidiaries as disclosed in Note 6.ii) A director of the Company, Koh Hong Muan @ Koh Gak Siong.

Significant related party transactions other than those disclosed elsewhere in the financials statements are as follows:

Group Company2012 2011 2012 2011

RM’000 RM’000 RM’000 RM’000

Associate Komark Enterprise Co. Ltd. - Sales - 35 - -

Subsidiaries Komark International (M) Sdn. Bhd.

- Sales 1,065 206 - - General Labels & Labelling (M) Sdn. Bhd.

- Sales 2,363 4,370 - - - Management fee - - - - - Rental income, premises 60 60 - - General Labels & Labelling (JB) Sdn. Bhd. - Sales 3,440 4,340 - - General Labels & Labelling (Penang) Sdn. Bhd. - Sales 312 262 - -GuangzhouKomarkLabels&LabellingCo.Ltd. - Sales 1,825 681 - - Shanghai Komark Labels & Labelling Co. Ltd. - Sales 739 898 - - - Management fee 698 - - - - Rental income of machinery 650 480 - - General Labels & Labelling Pte. Ltd. - Sales 66 43 - - General Labels & Labelling (Ipoh) Sdn. Bhd. - Sales 22 4 - - Komark (Thailand) Co. Ltd. - Sales 295 54 - -



28. FINANCIAL INSTRUMENTS

Financial Risk Management Objectives and Policies

Exposuretocredit, interestrate,currencyand liquidityrisksarises inthenormalcourseoftheGroupandoftheCompany. The Board and management reviews and agrees policies for managing each of these risks and they are summarised below:

Credit risk

The Group’s primary exposure to credit risk arises through trade and other receivables. Exposure to credit risk is monitored by management on an ongoing basis.

Allnewinvestment,ifany,inquotedandunquotedsecuritiesneedtobeapprovedbytheBoardofDirectors.Allinvestmentsinquotedsecuritiesareheldforlongtermpurposes,andtherefore,anytemporarydiminutioninvaluewill not have any significant impact to the Group and the Company.

At balance sheet date, there were no significant concentrations of credit risk. The maximum exposure to credit risk is represented by the carrying amount of each financial asset.

Interest rate risk

The Group utilises short term borrowings for working capital purposes and borrows term loans to finance capital expenditure. In view of the low interest rate scenario, exposure to fluctuation of interest rate risk is minimised.

Foreign currency risk

The Group incurs foreign currency risk on sales, purchases and borrowings that are denominated in currencies other than Ringgit Malaysia. Most of the foreign currency transactions are denominated in US Dollars, and only a small percentage of the foreign currency transactions are denominated in other foreign currencies. The Group does not hedge this exposure to the US dollars. The transactions in other foreign currencies are insignificant. The Group ascertains that the net exposure is kept to an acceptable level by buying and selling foreign currencies at spot rates where necessary action to minimise the exposure of the risk.

In respect of other monetary assets and liabilities held in currencies other than Ringgit Malaysia, the Group does not hedge this exposure as most of the monetary assets and liabilities are denominated in US Dollars or the reporting currency is used for the other monetary assets and liabilities of foreign subsidiaries in their respective countries.

The Group and the Company are also exposed to foreign currency risk in respect of their investment in foreign subsidiaries. The Group does not hedge this exposure by having foreign currency borrowings as the foreign subsidiaries operate independently from the holding company and source of their own funding to finance their operations. However, the Board and management will keep this policy under review and will taken the necessary action to minimise the exposure of this risk.

Liquidity risk

TheGroupmonitorsandmaintainsalevelofcashandcashequivalentsandbankfacilitiesdeemedadequatebymanagement to finance the Group’s operations and to mitigate the effects of fluctuations in cash flows.

The following table shows information about the Group’s exposure to interest rate risk.

Effective interest rates and repricing analysis

In respect of interest-earning financial asset and interest-bearing financial liabilities, the following table indicates their effective interest rates at the balance sheet date and the periods in which they reprice or mature, whichever is earlier.



28. FINANCIAL INSTRUMENTS (Cont’d)

Effectiveinterest

rate TotalWithin1 year

% RM’000 RM’000

Group

2012

Financial assetsDeposits placed with licensed banks 2.25 - 2.90 669 669

Financial liabilitiesBank overdrafts 8.10 - 9.10 20,043 20,043Bankers’ acceptance 4.74 - 8.10 12,479 12,479Term loans 5.65 - 8.60 10,593 3,024Short-term loans 5.59 - 8.40 13,852 13,852

2011

Financial assetsDeposits placed with licensed banks 3.00 - 3.70 2,368 2,368

Financial liabilitiesBank overdrafts 7.55 - 8.80 21,310 22,665Bankers’ acceptance 3.91 - 7.80 16,646 15,291Term loans 5.65 - 8.60 16,074 3,604Short-term loans 5.10 - 7.56 10,797 10,797

Company

2012

Financial liabilities

Bank overdraft 8.60 2,988 2,988

2011

Financial liabilities

Bank overdraft 7.75 2,987 2,987

Fair values

The aggregate fair value of the long term financial asset and long term financial liabilities carried on the balance sheet as at 30 April are shown below:

2012 2011Carrying Fair Carrying Fairamount value amount valueRM’000 RM’000 RM’000 RM’000

Group

Financial AssetsQuoted shares - long term 4 3 4 3

Thefairvalueofquotedsharesistheirquotedbidpriceatthebalancesheetdate.



28. FINANCIAL INSTRUMENTS (Cont’d)

Fair values (Cont’d)

Inrespectofcashandcashequivalents,tradeandotherreceivables,tradeandotherpayablesandshorttermborrowings, the carrying amounts approximate fair value due to the relatively short term nature of these financial instruments.

In respect of long-term borrowings, the carrying amounts approximate fair value as they are on floating rates and reprice to market interest rates for liabilities with similar risk profiles.

29. SIGNIFICANT EVENT

On 18 July 2011, Komark International (M) Sdn. Bhd., a wholly-owned subsidiary of the Company had entered into a sale and purchase agreement with Auravilla Project Sdn. Bhd. to dispose of a piece of freehold land of the subsidiary for a consideration of RM8,000,000. This disposal was completed on 29 May 2012.

30. SUBSEQUENT EVENT

On 29 June 2012, the Company announced that an application will be made to the General Registry, Cayman Islands to strike off Komark China Ltd., a wholly-owned subsidiary of the Company from the Register of Companies pursuant to Section 156 of the Companies Act of Cayman Islands.

31. COMPARATIVES

Certain comparative figures have been reclassified to conform with current year’s presentation. These changes in the comparative figures are as follows:

As previouslyreported Reclassification

Asrestated

RM’000 RM’000 RM’000

Balance Sheet

Receivables 33,322 1,783 35,105 Amount due from associated company 1,783 (1,783) -

32. AUTHORISATION FOR ISSUE

The financial statements of the Company for the financial year ended 30 April 2012 were authorised for issue in accordance with a resolution of the Board of Directors on 30 August 2012.



ANALYSIS OF SHAREHOLDINGS AS AT 14 SEPTEMBER 2012

ANALYSIS OF SHAREHOLDINGS AS AT 14 SEPTEMBER 2012

Authorised share capital : RM500,000,000.00Issued and paid-up share capital : RM 81,275,010.00Class of shares : Ordinary Shares of RM1.00 eachVoting rights : One vote per share

Size of Holdings

No. of Shareholders/

Depositors

% of Shareholders/

Depositors

No. of Shares

held*

% ofIssuedCapital

1 - 99 411 9.3601 15,110 0.0189100 - 1,000 615 14.0059 526,243 0.66001,001 - 10,000 2,501 56.9574 11,992,395 15.040110,001 - 100,000 792 18.0369 23,403,766 29.3516100,001 - 3,986,899 70 1.5942 28,891,607 36.23413,986,900 (5% of Issued Capital*) and above 2 0.0455 14,906,889 18.6953

TOTAL 4,391 100.000 79,736,010 100.0000

Note:

* Excluding a total of 1,539,000 Ordinary Shares of RM1.00 each bought back by the Company and retained as treasury shares.

SUBSTANTIAL SHAREHOLDERS AS AT 14 SEPTEMBER 2012

Direct IndirectNo. of Share

% of IssuedCapital(1)

No. of Shares

% ofIssuedCapital(1)

Aimas Enterprise Sdn Bhd 10,906,889 13.6787 - -Lim Pei Tiam @ Lim Ahat Kiat 4,000,000 5.0166 - -Koh Hong Muan @ Koh Gak Siong 6,010,300 7.5377 10,906,889(2) 13.6787

Notes:

(1) Excluding a total of 1,539,000 Ordinary Shares of RM1.00 each bought back by the Company and retained as treasury shares.

(2) Deemed interested in the shares by virtue of Section 6A(4)(c) of the Companies Act, 1965, held through Aimas Enterprise Sdn Bhd.


ANALYSIS OF SHAREHOLDINGS (CONT’D) AS AT 14 SEPTEMBER 2012

THIRTY LARGEST SHAREHOLDERS/DEPOSITORS AS AT 14 SEPTEMBER 2012

Name of Shareholders/Depositors

No. of Shares

% ofIssuedCapital*

1. EB Nominees (Tempatan) Sendirian BerhadPledged Securities Account for Aimas Enterprise Sdn Bhd (Jln Hang Lekiu)

10,906,889 13.6787

2. Lim Pei Tiam @ Liam Ahat Kiat 4,000,000 5.01663. EB Nominees (Tempatan) Sendirian Berhad

Pledged Securities Account for Koh Hong Muan @ Koh Gak Siong (Jln Hang Lekiu)3,680,000 4.6152

4. Maybank Nominees (Tempatan) Sdn BhdPledged Securities for Tan Ing Kiong

3,031,700 3.8022

5. HLB Nominees (Tempatan) Sdn BhdPledged Securities Account for Koh Hong Muan @ Koh Gak Siong (BLK 0688-8)

2,300,000 2.8845

6. Tan Kwe Hee 1,534,300 1.92427. Maybank Nominees (Tempatan) Sdn Bhd

Pledged Securities for Chai Kok Kheang1,406,100 1.7634

8. CIMSEC Nominees (Tempatan) Sdn BhdCIMB Bank for Chai Kok Kheang (MY1352)

990,000 1.2416

9. CIMSEC Nominees (Tempatan) Sdn BhdCIMB Bank for Tan Sun Ping (MY1353)

967,000 1.2128

10. Bu Yaw Seng 942,900 1.182511. SJ Sec Nominees (Tempatan) Sdn Bhd

Pledged Securities Account for Lim Boon Hong (SMT)776,233 0.9735

12. George Lee Sang Kian 730,200 0.915813. Ang Jwee Tong 563,678 0.706914. Wong Ah Yong 463,866 0.581615. AmBank (M) Berhad

Pledged Securities Account for Wong Ah Yong (SMART)453,333 0.5685

16. Tung P’ng Khai 445,500 0.558717. Mayban Nominees (Tempatan) Sdn Bhd

Pledged Securities Account for Chiah Tho Wak443,000 0.5556

18. Hsu, Yao-Jih 400,000 0.501719. TA Nominees (Tempatan) Sdn Bhd

Pledged Securities Account for Sinny United Sdn Bhd364,700 0.4574

20. Mayban Nominees (Tempatan) Sdn BhdPledged Securities Account for Tan Swee Ung

349,500 0.4383

21. Lim Kau 344,000 0.431422. HDM Nominees (Tempatan) Sdn Bhd

Pledged Securities Account for Sim Kean Hee (M06)306,000 0.3838

23. Lim Pay Kaon 300,000 0.376224. Chantika Holdings Sdn Bhd 293,232 0.367825. Mayban Nominees (Tempatan) Sdn Bhd

Fua Kia Pha286,000 0.3587

26. Tee Ah Swee 285,500 0.358127. Lim Kok Wah & Company Sdn Berhad 280,000 0.351228. TA Nominees (Tempatan) Sdn Bhd

Pledged Securities Account for Chow Kim Seng250,000 0.3135

29. Tay How Seng 249,000 0.312330. Tan Ah Tai @ Tan Ka Cheng 243,800 0.3058

TOTAL 37,586,431 47.1385

Note:

* Excluding a total of 1,539,000 Ordinary Shares of RM1.00 each bought back by the Company and retained as treasury shares.


ANALYSIS OF SHAREHOLDINGS (CONT’D)AS AT 14 SEPTEMBER 2012

DIRECTORS’ INTERESTS AS AT 14 SEPTEMBER 2012

No. of Shares

Director’s NameDirect

Interest %(1)IndirectInterest %(1)

Koh Hong Muan @ Koh Gak Siong (2) 6,010,300 7.5377 10,906,889 (3) 13.6787Koh Chie Jooi (2) - - 16,917,189 (4) 21.2165Koh Chee Mian (2) - - 16,917,189 (4) 21.2165Koh Chee Kian (2) - - 16,917,189 (4) 21.2165Koh Chee Hao (2) - - 16,917,189 (4) 21.2165Datuk Ng Peng Hong @ Ng Peng Hay - - - -Chew Chee Chek - - - -Ihsan bin Ismail - - - -

Notes:

(1) Excluding a total of 1,539,000 Ordinary Shares of RM1.00 each bought back by the Company and retained as treasury shares.

(2) By virtue of his interest in shares of the Company, the Director is also deemed to have an interest in the shares of all the subsidiaries of the Company to the extent the Company has an interest.

(3) Deemed interested in the shares by virtue of Section 6A(4)(c) of the Companies Act, 1965, held through Aimas Enterprise Sdn Bhd.

(4) Deemed interested in the shares by virtue of Section 122A(1)(a) of the Companies Act, 1965, held through his parent, namely Koh Hong Muan @ Koh Gak Siong.


Owner Title No/Location Land Area/ Build Up Area Sq.Ft

Age Of Building (Year)

Tenure Existingusage

ExpiryDate

Net bookValue as at30.04.2012

RM (‘000)

Komark International(M) Sdn. Bhd.

GM No. 439,Lot 132,Mukim of Kajang District,Hulu Langat, Selangor.

L-147,756B-150,000

10 Freehold Factory CumOffice (HQ)

- 21,427

General Labels &Labelling(M) Sdn. Bhd.

* Lot 2897, Mukim 6, District Seberang Prai Tengah, Penang.

L-10,814B-6,000

19 Freehold Factory CumOffice

- 865

General Labels & Labelling(M) Sdn. Bhd.

H.S (D) KA 39335P.T.NO 131760/23Hala Rapat Baru 22,Kawasan Perindustrian,Ringan Kinta Jaya.

L-3,640B-2,640

16 Leasehold Factory CumOffice

9/3/94 183

General Labels & Labelling(M) Sdn. Bhd.

Lot PTD 112290,Mukim of PlentongDistrict, Johor Bahru.

L-10,200B-5,394

16 Freehold Factory CumOffice

- 659

General Labels & Labelling (Penang)Sdn. Bhd.

* H.S. (M) 833, Lot 3052, Mukim 6, District of Seberang Prai Tengah, Penang.

L-2,723B-3,330

20 Freehold Factory - 190

GuongzhouKomark Labels & Labelling Co. Ltd.

Title No: 229030Second Floor,Building 2, Chunf Yie Road, Scientech Park Economic & TechnologicalDevelopment Zone, Guongzhou.

L-16,501B-17,416


9/11/44 1,129

Shanghai KomarkLabels & LabellingCo. Ltd.

Title No: 026381No.1, Baosheng Road,Songjiang Industrial Zone,Songjiang, Shanghai 201600, China.

L-89,222B-76,751


16/8/52 9,067

Note:

* These properties are in progress of disposal

LIST OF PROPERTIES


This page has been intentionally left blank.



I/We ___________________________________________________________________ (name of shareholder, in capital letters)

NRIC No./Passport No./ID No./Company No. ______________________________ (new) __________________________ (old)

of ____________________________________________________________________________________________ (full address)

being a member of KOMARKCORP BERHAD, hereby appoint ___________________________________________________

(name of proxy as per NRIC/Passport, in capital letters) NRIC No./Passport No._______________________________ (new)

___________________________ (old) of _____________________________________________________________ (full address)

and/or failing him/her _____________________________________ (name of proxy as per NRIC/Passport, in capital letters)

NRIC No./Passport No. _____________________________________ (new) ______________________________________ (old)

of _________________________________________________________________________ (full address) and/or failing him/her

* the Chairman of the Meeting as my/our proxy to vote for me/us on my/our behalf at the Sixteenth Annual General Meeting of the Company to be held at Langkawi Room, Bukit Jalil Golf & Country Resort, Jalan 3/155B, Bukit Jalil, 57000 Kuala Lumpur on Monday, 29 October 2012 at 10.00 a.m. and at each and every adjournment thereof.

* Please delete the words “the Chairman of the Meeting” if you wish to appoint some other person to be your proxy.

My/our proxy is to vote as indicated below:

RESOLUTIONS FOR AGAINST

1. Adoption of the Audited Financial Statements for the financial year ended 30 April 2012 and Directors’ and Auditors’ Reports thereon


2. Approval of Directors’ Fees Ordinary Resolution 2

3. Re-election of Mr Koh Hong Muan @ Koh Gak Siong as Director Ordinary Resolution 3

4. Re-election of Datuk Ng Peng Hong @ Ng Peng Hay as Director Ordinary Resolution 4

5. Re-election of Encik Ihsan bin Ismail as Director Ordinary Resolution 5

6. Re-appointment of Auditors Ordinary Resolution 6

7. Proposed Renewal of Share Buy-Back Mandate Ordinary Resolution 7

8. Proposed Renewal of General Mandate for Recurrent Related Party Transactions


9. Proposed authority under Section 132D of the Companies Act, 1965 for the Directors to issue shares


10. Proposed Amendments to the Articles of Association Special Resolution

(Please indicate with an “X” in the spaces provided how you wish your vote to be cast. If you do not do so, the proxy will vote or abstain from voting at his discretion.)

For appointment of two proxies, percentage of shareholdings to be represented by the proxies:

No. of shares Percentage

Proxy 1 %

Proxy 2 %

Total 100%

Signature/Common Seal

Number of shares held

Date:

PROXY FORM

CDS account no. of authorised nominee

Notes:

1. A member of the Company entitled to attend and vote at the meeting is entitled to appoint a proxy or proxies to attend and vote in his stead. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company.

2. A member may appoint not more than two (2) proxies to attend and vote at the same meeting. Where a member appoints two (2) proxies, the appointments shall be invalid unless he specifies the proportions of his shareholdings to be represented by each proxy.

3. Where a member of the Company is an exempt authorised nominee which holds shares in the Company for multiple beneficial owners in one securities account (“omnibus account”) as defined under the Securities Industry (Central Depositories) Act, 1991, there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

4. 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 Common Seal or under the hand of the attorney.

5. The instrument appointing a proxy, with the power of attorney or other authority (if any) under which it is signed or a notarially certified or office copy of such power or authority, must be deposited at the Company’s Share Registrars’ office at Level 17, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur not less than 48 hours before the time set for holding the meeting or any adjournment thereof.

Share RegistrarsKOMARKCORP BERHAD

c/o TRICOR INVESTOR SERVICES SDN BHDLEVEL 17, THE GARDENS NORTH TOWER

MID VALLEY CITYLINGKARAN SYED PUTRA

59200 KUALA LUMPURMALAYSIA

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