C O N T E N T S NOTICE OF ANNUAL GENERAL MEETING 2-3 CORPORATE INFORMATION 4 PENYATA PENGERUSI 6 CHAIRMAN'S STATEMENT 7 DIRECTORS REPORT 8-10

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1 C O N T E N T S Page NOTICE OF ANNUAL GENERAL MEETING 2-3 CORPORATE INFOATION 4 AUDIT COMMITTEE 5 PENYATA PENGERUSI 6 CHAIAN'S STATEMENT 7 DIRECTORS REPORT 8-10 STATEMENT BY DIRECTORS 11 STATUTORY DECLARATION 11 AUDITORS REPORT 12 CONSOLIDATED BALANCE SHEET 13 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 14 CONSOLIDATED INCOME STATEMENT 15 CONSOLIDATED CASH FLOW STATEMENT BALANCE SHEET 18 STATEMENT OF CHANGES IN EQUITY 19 INCOME STATEMENT 20 CASH FLOW STATEMENT 21 NOTES TO THE ACCOUNTS LIST OF PROPERTIES SHAREHOLDING STATISTICS DIRECTORS' SHAREHOLDINGS 33 FO OF PROXY 1

2 NOTICE OF ANNUAL GENERAL MEETING NOTICE IS HEREBY GIVEN that the Tenth Annual General Meeting of the Company will be held at Ponderosa Golf & Country Club, 10-C, Jalan Bumi Hijau Tiga, Taman Molek, Johor Bahru, Johor Darul Ta zim on Thursday, 14 December 2000 at a.m. for the following purposes:- A G E N D A 1. To receive and adopt the audited accounts for the year ended 31 July, 2000 and the Resolution 1 Reports of the Directors and the Auditors thereon. 2. To declare a Final dividend of 10% (tax exempt) for the year ended 31 July, 2000 Resolution 2 3. To approve the payment of Directors fee for the year ended 31 July, 2000 Resolution 3 4. To re-elect the retiring Directors :- 1. Goh Chai Siong Resolution 4 2. Dato' Haji Sulaiman Bin Ahmad Resolution 5 5. To re-appoint Messrs Arthur Andersen & Co. as Auditors of the Company until the conclusion Resolution 6 of the next Annual General Meeting and to authorise the directors to fix their remuneration. 6. Special Business To consider and if thought fit to pass the following ordinary resolutions : - Resolution 7 i) 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 Annual General Meeting and upon such terms and conditions and for such purposes as the Directors may in their absolute discretion deem fit provided that the aggregate number of shares to be issued does not exceed 10 per cent of the issued share capital of the Company for the time being, subject always to the approval of all the relevant regulatory bodies being obtained for such allotment and issue. 7. Any Other Business To transact any other ordinary business of which due notice shall have been given. 2

3 N O T I C E O F B O O K C L O S U R E NOTICE IS HEREBY GIVEN that the Share Transfer Books and Register of Members will be closed on 4 January, 2001 for the preparation of the dividend entitlement. Subject to the approval of the shareholders at the Tenth Annual General Meeting, the final dividend of 10% per share (tax exempt) will be paid on 19 January, 2001 to depositors who are registered in the Record of Depositors as at the close of business on 3 January, A depositor shall qualify for entitlement to the dividend only in respect of:- a) shares transferred into the Depositor's securities account before p.m. on 3 January, 2001 in respect of ordinary transfers; and b) shares bought on the Kuala Lumpur Stock Exchange on a cum entitlement basis according to the rules of the Kuala Lumpur Stock Exchange. BY ORDER OF THE BOARD, TAN SOI LIM (LS00565) SUJATA MENON A/P K.R.D.S. CHANDRAN (LS 02004) Secretaries Johor Bahru 24 November 2000 Notes: (a) A member of the Company entitled to attend and vote at this Meeting is entitled to appoint a proxy to attend and vote instead of him. A proxy need not be a member of the Company but must attend the meeting in person to vote. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised in writing or if such appointer is a corporation, under its Common Seal or the hand of its attorney. (b) Where a member appoints two proxies, the appointments shall be invalid unless he specifies the proportions of his holding to be represented by each proxy. (c) The Proxy Form must be deposited with the Secretary at the Registered Office of the Company at Suite 11.2B, Level 11, Menara Pelangi, No. 2, Jalan Kuning, Taman Pelangi, Johor Bahru, Johor, Malaysia not less than 48 hours before the time set for the meeting or any adjournament thereof. (d) Explanatory Note to Special Business The proposed Resolution 7 is in line with the Company's expansion plan which may involve the issue of new shares (other than bonus or rights issues). Under the Companies Act, 1965, the Directors would have to call for a general meeting to approve the issue of new shares even though the number of shares involved is less than 10 per cent of the issued capital of the Company for the time being. In order to avoid any delay and costs involved in convening a general meeting, it is thus considered appropriate to seek shareholders' approval for the Directors to issue shares (other than bonus or rights issues) in the Company up to an aggregate amount not exceeding 10 per cent of the issued capital of the Company for the time being and also to empower the Directors to obtain approval from the Kuala Lumpur Stock Exchange for the listing of and quotation for the additional shares so issued. This authority unless revoked or varied at a general meeting will expire at the next Annual General Meeting of the Company. 3

4 CORPORATE INFOATION BOARD OF DIRECTORS Chairman Dato' Haji Sulaiman Bin Ahmad Managing Director Goh Tong Huat Directors Goh Chai Siong Nora Lam Siew Wan Chang Choon Chang Chu Chen Mohd. Nadzir bin Mahmud Goh Wan Sing (Alternate Director to Chang Choon Chang Chu Chen) AUDIT COMMITTEE Chairman Mohd. Nadzir bin Mahmud (Independent Non-Executive Director) Members Goh Tong Huat (Managing Director) Nora Lam Siew Wan (Independent Non-Executive Director) SECRETARIES Tan Soi Lim (LS00565) Sujata Menon A/P K.R.D.S. Chandran (LS02004) REGISTERED OFFICE Suite 11.2B, Level 11, Menara Pelangi, No 2, Jalan Kuning, Taman Pelangi, Johor Bahru, Johor. Tel: REGISTRAR Securities Services (Holdings) Sdn Bhd (36869-T) Level 22, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, Kuala Lumpur. AUDITORS Messrs Arthur Andersen & Co. PRINCIPAL BANKERS Public Bank Berhad Malayan Banking Berhad RHB Bank Berhad SUBSIDIARIES Beaucar Accessories (M) Sdn Bhd ( P) Plasmet Industries (M) Sdn Bhd ( K) ASSOCIATED COMPANY Wirapadu Sistem Sdn Bhd ( M) STOCK EXCHANGE LISTING Second Board of The Kuala Lumpur Stock Exchange 4

5 AUDIT COMMITTEE TES OF REFERENCE OF AUDIT COMMITTEE THAT the following terms of reference of the Audit Committee be and are hereby adopted:- COMPOSITION The Committee shall be appointed by the directors from among them and shall consist of not less than three in numbers of whom a majority shall not be:- a) Executive directors of the Company or any relevant corporation, b) a spouse, parent, brother, sister, son or adopted son, daughter or adopted daughter of an executive director of the Company or any related corporation, or c) spouse of brother, sister, son or adopted son, daughter or adopted daughter of an executive director or any related corporation, or d) any person having a relationship which, in the opinion of the Board of Directors, would interfere with the exercise of the independent judgement in carrying out the functions of the Committee. The members of the Committee shall elect a Chairperson from among their number who is not an executive director or employee of the Company or any related corporation. If a member of the Committee resigns, dies, or for any other reason ceases to be a member with the result that the number of members is reduced to less than three (3), the Board of Directors shall within three (3) months of that event, appoint such number of new members as may be required to make up the minimum number of three members. AUTHORITY The Committee is authorised by the Board to investigate any activity within its terms of reference. It is authorised to seek any information it requires from any employees and all employees are directed to co-operate with any request made by the Committee. The Committee shall also have the authority to consult independent experts where they consider it necessary to carry out their duties. MEETING The Committee shall meet at least twice a year and such meetings as the Chairperson shall decide in order to fulfill its duties. The Secretary of the Committee shall be responsible, in conjunction with the Chairperson, for drawing up the agenda and circulating to the Committee prior to each meeting. The Secretary will also be responsible for keeping the minutes of the meetings of the Committee, and circulating them to Committee members and to other members of the Board of Directors. A quorum shall consist of a majority of Committee members. FUNCTIONS The functions of the Committee are as follows:- 1. review the audit plan with the external auditor 2. review with the external auditor his evaluation of the system of internal controls 3. review the audit report with the external auditor 4. review the assistance given by the company s officer to the auditor 5. review the scope and effectiveness of the internal procedures 6. review the balance sheet and profit and loss account before public release 7. review any related party transactions that may arise within the Company or the Group 8. to consider the nomination of a person or persons as auditors; and 9. to perform any other work that is required or empowered to do so by statutory legislation or guidelines as prepared by the relevant Government authorities 5

6 PENYATA PENGERUSI Bagi pihak Lembaga Pengarah, saya dengan sukacitanya ingin membentangkan Laporan Tahunan Multi-Code Electronics Industries (M) Berhad ("MCE" atau 'Syarikat") dan anak-anak syarikatnya ("Kumpulan") untuk tahun kewangan berakhir 31 Julai, ULASAN KEWANGAN Bagi tahun kewangan ini, Kumpulan telah mencapai jumlah perolehan sebanyak juta berbanding dengan juta pada tahun 1999 yang mewakili peningkatan sebanyak 86.74%. Kumpulan telah mencatatkan pendapatan sebelum cukai sebanyak juta berbanding dengan 4.81 juta pada tahun lepas. Keputusan yang menggalakkan ini adalah selaras dengan pencapaian yang cemerlang dalam pasaran otomotif. DIVIDEN Pihak Lembaga Pengarah telah mencadangkan untuk pengesahan, dividen akhir yang dikecualikan dari cukai sebanyak 10% berjumlah 3,964,700 untuk tahun kewangan berakhir 31 Julai 2000 di Mesyaurat Agung Tahunan yang akan datang. PERKEMBANGAN KORPORAT Keadaan positif ekonomi negara kita yang berterusan, dapat menjangkakan prestasi Kumpulan yang lebih baik. Kumpulan akan meneruskan pengurusan berhemah dan cuba mencari peluang baru untuk meningkatkan keuntungan Kumpulan. Perkilangan dan pembekalan alat penggera kawalan jauh automatik, kunci berpusat dan tingkap berkuasa untuk kenderaan bermotor akan terus menjadi perniagaan asas Kumpulan dan penyumbang utama pendapatan tahun kewangan semasa berakhir 31 Julai Pihak Lembaga menjangkakan prestasi Kumpulan akan meningkat, melainkan berlakunya situasi diluar jangkaan. PENGHARGAAN Bagi pihak Lembaga Pengarah, saya ingin merakamkan penghargaan dan mengucapkan terima kasih kepada pelanggan yang dihargai, para rakan niaga, institusi kewangan dan para pembekal kerana memberikan sokongan dan keyakinan yang berterusan kepada Kumpulan. Saya ingin merakamkan rasa syukur kepada para pekerja dan pihak pengurusan di atas usaha, perkhidmatan yang bernilai, sumbangan dan dedikasi yang diberikan kepada Kumpulan. Akhir sekali, saya ingin mengucapkan terima kasih kepada rakan-rakan sekerja dalam Lembaga Pengarah di atas sokongan yang diberikan, juga kepada para pemegang saham di atas keyakinan mereka terhadap Lembaga Pengarah dan pihak pengurusan Kumpulan. DATO' HJ. SULAIMAN BIN AHMAD Pengerusi 6

7 CHAIAN'S STATEMENT On behalf of the Board of Directors, I would like to present the Annual Report of Multi-Code Electronics Industries (M) Berhad ("MCE" or "the Company") and its Subsidiaries ("the Group") for the financial year ended 31 July FINANCIAL OVERVIEW For the year under review, the Group achieved a turnover of million compared to million in 1999, representing an increase of 86.41%. The Group recorded a pre-tax profit of million compared to 4.81 million in the previous year. The improvement in the result is in tandem with the improved performance of the automotive market. DIVIDENDS The Board of Directors has recommend for approval a final 10% tax exempt dividend amounting to 3,964,700 for the financial year ended 31 July 2000 at the forthcoming Annual General Meeting. CORPORATE DEVELOPMENTS The continuing positive outlook of our country's economy should augur well for the Group's operation. The Group shall continue prudent management and source for new opportunities to increase the profitability of the Group. Manufacture and supply of remote control, auto alarm, central locks and power window for motor vehicles will remain the Group's core business and earning contributor for the current financial year ending 31 July Barring unforeseen circumstances, the Board expects the Group's performance to improve. APPRECIATION On behalf of the Board, I wish to record my appreciation and to thank our valued customers, business associates, financiers and suppliers for their continued support and confidence in the Group. I would like to express my gratitude to the staff and management of the Group for their hard work, invaluable service, contribution and dedication. Finally, I wish to thank my fellow collegues on the Board of Directors for their support and the shareholders for their confidence in the Board of Directors and Management of the Group. DATO' HJ. SULAIMAN BIN AHMAD Chairman 7

8 DIRECTORS REPORT The directors hereby submit their report together with the audited accounts of the Company and of the Group for the financial year ended 31 July, PRINCIPAL ACTIVITIES The principal activities of the Company are the manufacture and supply of remote control auto alarm, central locks and power window for motor vehicles. The principal activities of the subsidiaries are described in Note 8 to the accounts. There have been no significant changes in these principal activities during the financial year. RESULTS Group Company Net profit for the year 8,463,979 6,748,897 DIVIDENDS The amount of dividends paid by the Company since 31 July, 1999 were as follows : In respect of the previous financial year ended 31 July, 1999 Final tax exempt dividend of 8% paid on 21 January, ,171,760 The directors recommend a final dividend of 10% tax exempt amounting to 3,964,700 in respect of the current financial year. RESERVES AND PROVISIONS There were no material transfers to or from reserves or provisions during the financial year. BAD AND DOUBTFUL DEBTS Before the income statements and balance sheets were made out, the directors took reasonable steps to ascertain that action had been taken in relation to the writing off of bad debts and the making of provision for doubtful debts and have satisfied themselves that all known bad debts had been written off and that no provision for doubtful debts is required. At the date of this report, the directors are not aware of any circumstances which would require any debts to be written off or a provision for doubtful debts in the accounts of the Company and the Group. CURRENT ASSETS Before the income statements and balance sheets were made out, the directors took reasonable steps to ensure that any current assets which were unlikely to be realised in the ordinary course of business including their values as shown in the accounting records of the Company and the Group have been written down to an amount which they might be expected so to realise. At the date of this report, the directors are not aware of any circumstances which would render the values attributed to the current assets in the accounts of the Company and the Group misleading. 8

9 VALUATION METHODS At the date of this report, the directors are not aware of any circumstances which have arisen which render adherence to the existing methods of valuation of assets or liabilities of the Company and the Group misleading or inappropriate. CONTINGENT AND OTHER LIABILITIES At the date of this report, there does not exist: (a) (b) any charge on the assets of the Company or of the Group which has arisen since the end of the financial year which secures the liabilities of any other person; or any contingent liability of the Company or of the Group which has arisen since the end of the financial year. No contingent or other liability have 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 Company or of the Group to meet their obligations when they fall due. CHANGE OF CIRCUMSTANCES At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this report or the accounts of the Company or of the Group which would render any amount stated in the accounts misleading. ITEMS OF AN UNUSUAL NATURE The results of the operations of the Company and of the Group during the financial year were not, in the opinion of the directors, substantially affected by any item, transaction or event of a material and unusual nature. There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature likely, in the opinion of the directors, to affect substantially the results of the operations of the Company or of the Group for the financial year in which this report is made. DIRECTORS The directors who served since the date of the last report are : Dato Hj Sulaiman bin Ahmad Goh Tong Huat Goh Chai Siong Nora Lam Siew Wan Chang Choon Chang Chu Chen Goh Wan Sing (Alternate director to Chang Choon Chang Chu Chen) Mohd. Nadzir Bin Mahmud In accordance with the Company s Articles of Association, Dato Hj Sulaiman bin Ahmad and Goh Chai Siong retire at the forthcoming Annual General Meeting and being eligible, offer themselves for re-election. DIRECTORS BENEFITS During and at the end of the financial year, no arrangements subsisted to which the Company or its subsidiary is a party with the object of enabling directors of the Company to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate. 9

10 10 Since the end of the previous financial year, no director has received or become entitled to receive a benefit (other than a benefit included in the aggregate amount of emoluments received or due and receivable by the directors as shown in Note 14 to the accounts 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 the director or with a firm of which he is a member, or with a company in which he has a substantial financial interest. DIRECTORS INTERESTS 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 Shares of 1 each 1 August, 31 July, 1999 Bought Sold 2000 Dato Hj Sulaiman bin Ahmad - indirect 2,201, ,201,000 Goh Tong Huat - direct 10,928, ,928,655 - indirect 456, ,471 Chang Choon Chang Chu Chen 7,908, ,908,660 Goh Chai Siong 3,206, ,206,214 Other than as disclosed above, the directors in office at the end of the financial year had no interest in shares of the Company and its subsidiaries during the financial year. NUMBER OF EMPLOYEES AND REGISTERED OFFICE The number of employees as at 31 July, 2000 in the Company and the Group were 364 and 487 respectively. The registered office address of the Company is located at Suite 11.2B, Level 11, Menara Pelangi, No.2, Jalan Kuning, Taman Pelangi, Johor Bahru. AUDITORS Arthur Andersen & Co. retire and have indicated their willingness to accept re-appointment. Signed on behalf of the Board in accordance with a resolution of the directors DATO HJ SULAIMAN BIN AHMAD Johor Bahru 2 October 2000 GOH TONG HUAT

11 11 STATEMENT BY DIRECTORS We, DATO HJ SULAIMAN BIN AHMAD and GOH TONG HUAT, being two of the directors of MULTI-CODE ELECTRONICS INDUSTRIES (M) BERHAD, do hereby state that, in the opinion of the directors, the accompanying balance sheets of the Company and the Group as at 31 July, 2000 and the statements of changes in equity, income and cash flow statements of the Company and of the Group for the year then ended, together with the notes thereto, give a true and fair view of the state of affairs of the Company and of the Group as at 31 July, 2000 and of its results and cash flows for the year then ended, and have been properly drawn up in accordance with applicable approved accounting standards in Malaysia. Signed on behalf of the Board in accordance with a resolution of the directors DATO HJ SULAIMAN BIN AHMAD Johor Bahru 2 October 2000 GOH TONG HUAT STATUTORY DECLARATION I, GOH TONG HUAT, the director primarily responsible for the financial management of MULTI-CODE ELECTRONICS INDUSTRIES (M) BERHAD, do solemnly and sincerely declare that the accompanying balance sheets of the Company and the Group as at 31 July, 2000 and the statements of changes in equity, income and cash flow statements of the Company and of the Group for the year then ended, together with the notes thereto 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 Declarations Act, Subscribed and solemnly declared by ) the abovenamed GOH TONG HUAT ) at Johor Bahru in the state of Johor ) on 2 October 2000 ) GOH TONG HUAT Before me: Commissioner for Oaths

12 12 AUDITORS REPORT To the Shareholders of MULTI-CODE ELECTRONICS INDUSTRIES (M) BERHAD We have audited the accounts of MULTI-CODE ELECTRONICS INDUSTRIES (M) BERHAD (the Company) and the consolidated accounts of MULTI-CODE ELECTRONICS INDUSTRIES (M) BERHAD AND ITS SUBSIDIARIES (the Group) as at 31 July, These accounts are the responsibility of the Company s directors. Our responsibility is to express an opinion on these accounts based on our audit. We conducted our audit in accordance with approved Standards on Auditing in Malaysia. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the accounts are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the accounts. An audit also includes assessing the accounting principles used and significant estimates made by the directors, as well as evaluating the overall accounts presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, (a) (b) the accounts give a true and fair view of the state of affairs of the Company and of the Group as at 31 July, 2000 and of the results and cash flows of the Company and of the Group for the year then ended, and have been properly drawn up in accordance with the provisions of the Companies Act, 1965 and applicable approved accounting standards in Malaysia; and the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiaries have been properly kept in accordance with the provisions of the Act. We are satisfied that the accounts of the subsidiaries that have been consolidated with the Company s accounts are in form and content appropriate and proper for the purposes of the preparation of the consolidated accounts and we have received satisfactory information and explanations required by us for these purposes. The audit reports on the accounts of the subsidiaries were not subject to any qualification or any comment made under subsection (3) of Section 174 of the Act. Arthur Andersen & Co. No. AF0103 Public Accountants Bala Krishnan A/L Ponniah No. 1394/7/01(J) Partner of the Firm Johor Bahru 2 October 2000

13 13 CONSOLIDATED BALANCE SHEET - 31 JULY, 2000 CURRENT ASSETS Note Cash and bank balances 3 20,650,416 21,059,850 Trade debtors less provision for doubtful debts of 235,734 (1999 : 90,000) 6,853,237 9,049,081 Other debtors, deposits and prepayments 1,185, ,338 Stocks 4 21,705,586 17,652,677 Due from an associated company 6 6,264,219 - CURRENT LIABILITIES 56,659,354 48,481,946 Trade creditors 5,318,346 3,125,488 Other creditors and accruals 4,604,046 4,555,001 Taxation 2,921, ,551 Proposed dividend 3,964,700 3,171,760 16,808,270 11,652,800 NET CURRENT ASSETS 39,851,084 36,829,146 FIXED ASSETS 7 26,125,788 25,191,635 ASSOCIATED COMPANY 9 881,032 5,000 MINORITY INTERESTS (1,102,802) (769,958) 65,755,102 61,255,823 SHAREHOLDERS FUNDS Share capital 10 39,647,000 39,647,000 Reserves 26,108,102 21,608,823 65,755,102 61,255,823 The accompanying notes are an integral part of this balance sheet.

14 14 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 JULY, 2000 Share buy Share Share Revaluation Reserve on back Retained capital premium reserve consolidation reserve profits Total At 1 August, ,750,000 4,448,713 1,438, , ,000 13,796,283 59,903,180 Shares bought back and cancelled (103,000) (103,000) Net profit for the year ,658,803 4,658,803 Dividend (Note 18) (3,171,760) (3,171,760) Transfer to share buy back ,400 (134,400) - Excess of nominal value over price paid for shares bought back (31,400) - (31,400) At 31 July, ,647,000 4,448,713 1,438, , ,000 15,148,926 61,255,823 Net profit for the year ,463,979 8,463,979 Dividend (Note 18) (3,964,700) (3,964,700) At 31 July, ,647,000 4,448,713 1,438, , ,000 19,648,205 65,755,102 The accompanying notes are an integral part of this statement.

15 15 CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 JULY, 2000 Note Revenue 12 59,412,221 31,865,890 Other operating income , ,087 Changes in inventories of finished good and work-in-progress (517,624) 1,798,703 Raw materials and consumables used (32,050,512) (12,983,642) Purchase of trading inventories (5,390,716) (7,268,039) Staff costs 14 (6,553,684) (5,325,914) Depreciation (1,924,747) (2,060,339) Other operating expenses 15 (4,234,960) (2,789,319) Profit from operations 9,107,109 3,400,427 Interest income, net ,834 1,408,605 Share of results in associated company 2,228,067 - Profit before taxation 11,897,010 4,809,032 Taxation 17 (3,100,187) 5,918 Profit after taxation 8,796,823 4,814,950 Minority interests (332,844) (156,147) Net profit for the year 8,463,979 4,658,803 Earnings per share sen 11.8 sen The accompanying notes are an integral part of this statement.

16 16 CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 JULY, 2000 CASH FLOWS FROM OPERATING ACTIVITIES Net profit before taxation 11,897,010 4,809,032 Adjustments for : Depreciation 1,924,747 2,060,339 Share of profit in an associated company (2,228,067) - Interest income (593,276) (1,420,924) Provision for doubtful debts 145,734 18,000 Gain on disposal of fixed assets (187,425) (62,890) Operating profit before working capital changes 10,958,723 5,403,557 Debtors 1,584,552 (5,988,239) Stocks (4,052,909) 3,223,556 Creditors 2,241,903 (1,019,672) Associated company (6,264,219) - Cash generated from operations 4,468,050 1,619,202 Income tax paid (537,830) (1,479,542) Net cash from operating activities 3,930, ,660 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investment - (5,000) Dividend from an associated company 910,305 - Interest received 593,276 1,420,924 Purchase of fixed assets (2,940,475) (461,969) Proceeds from disposal of fixed assets 269,000 65,200 Net cash (used in)/from investing activities (1,167,894) 1,019,155 CASH FLOWS FROM FINANCING ACTIVITIES Shares bought back Dividend paid - (134,400) (3,171,760) (2,775,290) Net cash used in financing activities (3,171,760) (2,909,690)

17 17 CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 JULY, 2000 (Cont d) NET DECREASE IN CASH AND CASH EQUIVALENTS (409,434) (1,750,875) CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 21,009,850 22,760,725 CASH AND CASH EQUIVALENTS AT END OF THE YEAR 20,600,416 21,009,850 The accompanying notes are an integral part of this statement.

18 18 BALANCE SHEET - 31 JULY, 2000 CURRENT ASSETS Note Cash and bank balances 3 20,143,719 20,709,757 Trade debtors 5,484,391 7,334,911 Other debtors, deposits and prepayments 1,106, ,837 Stocks 4 20,227,473 16,382,473 Due from subsidiary companies 5-713,909 Due from an associated company 6 6,264,219-53,226,320 45,790,887 CURRENT LIABILITIES Trade creditors 4,644,669 2,605,710 Other creditors and accruals 4,312,357 4,287,994 Due to subsidiary companies 5 923,617 - Taxation 2,564, ,215 Proposed dividend 3,964,700 3,171,760 16,409,924 10,795,679 NET CURRENT ASSETS 36,816,396 34,995,208 FIXED ASSETS 7 23,786,184 22,823,175 SUBSIDIARIES 8 2,391,942 2,391,942 ASSOCIATED COMPANY 9 5,000 5,000 SHAREHOLDERS FUNDS 62,999,522 60,215,325 Share capital 10 39,647,000 39,647,000 Reserves 23,352,522 20,568,325 62,999,522 60,215,325 The accompanying notes are an integral part of this balance sheet.

19 19 STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 JULY, 2000 Share buy Share Share Revaluation back Retained capital premium reserve reserve profits Total At 1 August, ,750,000 4,448,713 1,438, ,000 13,997,418 59,883,816 Shares bought back and cancelled (103,000) (103,000) Net profit for the year ,637,669 3,637,669 Dividend (Note 18) (3,171,760) (3,171,760) Transfer to share buy back ,400 (134,400) - Excess of nominal value over price paid for shares bought back (31,400) - (31,400) At 31 July, ,647,000 4,448,713 1,438, ,000 14,328,927 60,215,325 Net profit for the year ,748,897 6,748,897 Dividend (Note 18) (3,964,700) (3,964,700) At 31 July, ,647,000 4,448,713 1,438, ,000 17,113,124 62,999,522 The accompanying notes are an integral part of this statement.

20 20 INCOME STATEMENT FOR THE YEAR ENDED 31 JULY, 2000 Note Revenue 12 57,948,955 30,056,815 Other operating income 13 1,286, ,819 Changes in inventories of finished good and work-in-progress (509,677) 1,576,965 Raw materials and consumables used (40,135,885) (21,278,745) Staff costs 14 (5,126,480) (4,351,877) Depreciation (1,469,015) (1,612,724) Other operating expenses 15 (3,588,784) (2,369,455) Profit from operations 8,405,536 2,227,798 Interest income, net ,361 1,409,871 Profit before taxation 8,967,897 3,637,669 Taxation 17 (2,219,000) - Profit after taxation 6,748,897 3,637,669 The accompanying notes are an integral part of this statement.

21 21 CASH FLOW STATEMENT FOR THE YEAR ENDED 31 JULY, 2000 CASH FLOWS FROM OPERATING ACTIVITIES Net profit before taxation 8,967,897 3,637,669 Adjustments for : Gain on disposal of fixed assets (178,425) (24,890) Depreciation 1,469,015 1,612,724 Interest income (590,651) (1,418,974) Operating profit before working capital changes 9,667,836 3,806,529 Debtors 1,393,839 (5,637,815) Stocks (3,845,000) 3,543,201 Subsidiary companies 1,637, ,163 Creditors 2,063,322 (1,063,761) Associated company (6,264,219) - Cash generated from operations 4,653,304 1,237,317 Income tax paid (384,634) (1,377,050) Net cash from/(used in) operating activities 4,268,670 (139,733) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investment - (5,000) Dividend paid (3,171,760) (2,775,290) Proceeds from disposal of fixed assets 260,000 27,200 Purchase of fixed assets (2,513,599) (363,437) Interest received 590,651 1,418,974 Net cash used in investing activities (4,834,708) (1,697,553) CASH FLOWS FROM FINANCING ACTIVITIES Shares bought back - (134,400) Net cash used in financing activities - (134,400) NET DECREASE IN CASH AND CASH EQUIVALENTS (566,038) (1,971,686) CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 20,684,757 22,656,443 CASH AND CASH EQUIVALENTS AT END OF THE YEAR 20,118,719 20,684,757 The accompanying notes are an integral part of this statement.

22 22 NOTES TO THE ACCOUNTS - 31 JULY, PRINCIPAL ACTIVITIES The principal activities of the Company are the manufacture and supply of remote control, auto alarm, central locks and power window for motor vehicles. The principal activities of the subsidiaries are described in Note 8 to the accounts. There have been no significant changes in these principal activities during the financial year. 2. SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Accounting The accounts of the Company are prepared under the historical cost convention modified by the revaluation of certain land and buildings and comply with applicable approved accounting standards in Malaysia. (b) Basis of Consolidation The consolidated accounts include the accounts of the Company and its subsidiaries made up to the end of the financial year. The results of the subsidiary acquired during the year are included in the consolidated income statement from the date of acquisition. Intragroup transactions are eliminated on consolidation and the consolidated accounts reflect external transactions only. The difference between the purchase price and the fair value of the net assets of the subsidiaries at the date of acquisition is included in the consolidated balance sheet as goodwill or reserve arising on consolidation. The goodwill on consolidation is amortised over the period of 20 years. (c) Associated Company The Group treats as associated company those company in which the Group has a long term equity interest and where it exercises significant influence through management participation. The Group s share of profits less losses of associated company is included in the consolidated income statement and Group s interest in associated Company is stated at cost plus adjustments to reflect changes in the Group s share of the net assets of the associated company. (d) Stocks Stocks are stated at the lower of cost and net realisable value. Cost is determined principally on the first-in first-out (FIFO) basis. For work-in-progress and finished goods, cost includes raw materials, direct labour and appropriate production overheads. (e) Fixed Assets and Depreciation Fixed assets are stated at cost or valuation less accumulated depreciation. No depreciation is provided on freehold land. Depreciation on the other fixed assets is provided on the straight line basis calculated to write off the cost of each asset over its estimated useful life. The principal annual rates of depreciation are : Buildings 2% Plant and machinery 20% Equipment, furniture and fittings 10% Motor vehicles 20% Renovation 10% Electrical installation 10% Loose tools 50% Moulds 15% Computer 50% The Group and the Company adopted the policy of revaluing the land and building once in every five years.

23 23 (f) Currency Conversion and Translation Transactions in foreign currencies during the year are converted into Ringgit Malaysia at rates of exchange approximating those ruling at the transaction dates. Foreign currency monetary assets and liabilities at the balance sheet date are translated into Ringgit Malaysia at rates of exchange approximating those ruling at that date. All exchange gains or losses are dealt with in the income statement. The exchange rates ruling at balance sheet date used are as follows : United States Dollar Singapore Dollar New Taiwan Dollar (g) Deferred Taxation Deferred taxation is provided under liability method for all material timing differences except where there is reasonable evidence that these timing differences will not be reversed in the foreseeable future. (h) Investment Investment in subsidiaries are stated at cost less provision for diminution in value which is considered to be permanent. (i) Cash and Cash Equivalents Cash and cash equivalents include fixed deposit, cash and bank balances that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in values. 3. CASH AND BANK BALANCES Group Company Cash in hand and at banks 5,600,416 1,439,453 5,118,719 1,114,360 Fixed deposit with licensed banks 15,050,000 19,620,397 15,025,000 19,595,397 20,650,416 21,059,850 20,143,719 20,709,757 Included in the fixed deposit of the Group and the Company is an amount of 50,000 (1999 : 50,000) and 25,000 (1999 : 25,000) respectively which are pledged to a bank as security for bank guarantee facility.

24 24 4. STOCKS Group Company Raw materials 14,585,853 10,015,320 14,078,227 9,723,550 Work-in-progress 633,732 1,126, , ,039 Finished goods 6,486,001 6,510,584 5,762,431 5,764,884 21,705,586 17,652,677 20,227,473 16,382, DUE (TO)/FROM SUBSIDIARY COMPANIES Company Due from subsidiaries - 713,909 Due to subsidiaries (923,617) - The amounts due (to)/from subsidiaries are trade-in-nature. (923,617) 713, DUE FROM AN ASSOCIATED COMPANY Group and Company The amount due from an associated company is trade in nature. 7. FIXED ASSETS At Valuation < At Cost > Freehold Freehold Group land and Land and Plant and *Other 2000 buildings Buildings machinery assets Total COST/VALUATION At 1 August, ,698,206 12,367,041 2,333,230 15,717,885 37,116,362 Additions - 1,869, , ,083 2,940,475 Disposals (470,378) (470,378) At 31 July, ,698,206 14,236,949 2,719,714 15,931,590 39,586,459 ACCUMULATED DEPRECIATION At 1 August, , ,951 1,249,543 10,242,972 11,924,727 Charge for the year 55, , ,569 1,334,197 1,924,747 Disposals (388,803) (388,803) At 31 July, , ,098 1,613,112 11,188,366 13,460,671

25 25 At Valuation < At Cost > Freehold Freehold Group land and Land and Plant and *Other 2000 buildings Buildings machinery assets Total NET BOOK VALUE At 31 July, ,477,111 13,798,851 1,106,602 4,743,224 26,125,788 At 31 July, ,532,945 12,100,090 1,083,687 5,474,913 25,191,635 Depreciation charge for ,389 89, ,625 1,470,074 2,060,339 Company 2000 COST/VALUATION At 1 August, ,868,206 12,367, ,877 14,918,597 33,776,721 Additions - 1,869,908 1, ,391 2,513,599 Disposals (407,878) (407,878) At 31 July, ,868,206 14,236, ,177 15,153,110 35,882,442 ACCUMULATED DEPRECIATION At 1 August, , , ,572 9,907,292 10,953,546 Charge for the year 55, , ,242,902 1,469,015 Disposals (326,303) (326,303) At 31 July, , , ,371 10,823,891 12,096,258 NET BOOK VALUE At 31 July, ,652,641 13,800,518 3,806 4,329,219 23,786,184 At 31 July, ,708,475 12,100,090 3,305 5,011,305 22,823,175 Depreciation charge for ,724 89, ,687 1,359,062 1,612,724 * Other assets comprise of equipment, furniture and fittings, motor vehicles, renovation, electrical installation, loose tools, moulds and computer. Certain freehold land and buildings of the Group and the Company are stated at valuation determined on the existing use basis which was carried out by independent professional valuers in The surplus arising from the revaluation of the freehold land and buildings is credited to the revaluation reserve.

26 26 Had the revalued fixed assets been stated at historical cost less depreciation, the net book value of each class of fixed assets that would have been included in the accounts at the end of the financial year are as follows : Group Company Freehold land 2,526,520 2,526,520 2,352,327 2,352,327 Buildings 1,190,773 1,216,659 1,166,187 1,191,539 3,717,293 3,743,179 3,518,514 3,543, SUBSIDIARIES Unquoted shares, at cost 2,391,942 2,391,942 Effective Place of interest Name of Company incorporation Principal activities % % Beaucar Accessories (M) Sdn. Bhd. Malaysia Trading in auto accessories. Plasmet Industries (M) Sdn. Bhd. Malaysia Manufacturers of precision plastic, metal parts, precision moulds and toolings. 9. ASSOCIATED COMPANY Group Company Unquoted shares, at cost 5,000 5,000 5,000 5,000 Share of post acquisition reserves 876, Represented by : Share of net tangible assets 881,032 5, ,032 5,000 5,000 5,000 The results of the associated company are based on the audited accounts as at 31 December, 1999 and management accounts for the seven months ended 31 July, The associated company is : Effective Place of interest Name of Company incorporation Principal activities % % Wirapadu Sistem Sdn. Bhd. Malaysia Trading in auto accessories

27 SHARE CAPITAL Ordinary shares at 1 each : Authorised 50,000,000 50,000,000 Issued and fully paid : As at 1 August 39,647,000 39,750,000 Shares bought back and cancelled - (103,000) As at 31 July 39,647,000 39,647, DEFERRED TAXATION Deferred taxation of 71,934 (1999 : 71,934) is not provided on the surplus arising from the revaluation of freehold land and buildings as it is not the intention of the directors to dispose these properties. 12. REVENUE Revenue of the Group and of the Company consist of invoiced value of sales of goods less returns and discounts. 13. OTHER OPERATING INCOME Included in other operating income of the Group and the Company are the following : Group Company Rental received (56,600) (68,300) (159,776) (166,676) Gain on disposal of fixed assets (187,425) (62,890) (178,425) (24,890) Gross dividend from an associated company - - (910,305) - Management fee from an (24,000) - (24,000) - associated company 14. STAFF COSTS Included in staff costs of the Group and the Company are the following : Group Company Salaries paid to : - directors of the Company 498, , , ,796 - a director of a subsidiary 15,658 97,

28 OTHER OPERATING EXPENSES This is stated after charging/(crediting) : Group Company Directors fee 288, , , ,000 Auditors remuneration : - current year 38,000 32,000 28,000 22,000 - over provision in prior year (1,000) (1,000) - - Rental of hostels 56,100 29,340 56,100 29,340 Provision for doubtful debts 145,734 18, Bad debts written off - 13, Loss on currency exchange - realised 39,968 15,020 39,602 16, INTEREST INCOME, NET Included in interest income of the Group and the Company are interest income of 593,276 (1999 : 1,420,924) and 590,651 (1999 : 1,418,974) respectively. 17. TAXATION Group Company Current year s provision 2,657,700-2,219,000 - Under/(Over) provision in prior years 757 (5,918) - - Share of taxation of an associated company 441, ,100,187 (5,918) 2,219,000 - The effective rate of taxation of the Group for the year is lower than the statutory income tax rate primarily due to tax exempt dividends received being not taxable and utilisation of brought forward tax losses by a subsidiary company. The effective rate of taxation of the Company for the year is lower than the statutory income tax rate primarily due to tax exempt dividends received being not taxable. The Company has tax credits and tax exempt accounts to frank the payment of dividends out of its retained profits under the following Act subject to agreement with the Inland Revenue Board : (a) (b) (c) Tax credits under Section 108 of Income Tax, 1967 of approximately 9,692,000 (1999 : 7,649,000). Tax exempt account under Section 133A of Income Tax Act, 1967 of approximately 3,936,000 (1999 : 3,936,000). Tax exempt account arising from pioneer status of approximately 14,811,000 (1999 : 18,775,000). (d) Tax exempt account under Section 12 of Income Tax (Amendment) Act, 1999 of approximately 4,158,000 (1999 : 4,158,000).

29 DIVIDEND Amount Dividend per share Sen Sen Proposed final dividend : 10% (1999 : 8%) tax exempt 3,964,700 3,171, EARNINGS PER SHARE The basic earnings per share is calculated by dividing the Group earnings of 8,463,979 (1999 : 4,658,803) by the weighted average number of shares in issue during the year of 39,647,000 (1999 : 39,651,036) shares. 20. SIGNIFICANT RELATED PARTIES TRANSACTIONS Sales to a subsidiary 4,854,920 6,575,139 Sales to an associated company 12,918,424 - Purchases from a subsidiary 5,481,053 3,051,480 Rental income from a subsidiary 136, ,776 The directors of the Company are of the opinion that the above transactions have been entered into in the normal course of business. 21. SEGMENT INFOATION No segmental reporting is prepared as the Group s activities are carried out entirely in Malaysia and the Group s operations are in the trading and manufacturing of automobile parts. 22. CURRENCY All amounts are stated in Ringgit Malaysia (), unless otherwise stated.

30 30 LIST OF PROPERTIES Tenure Area (approximate in square Net Book Value Location age of building) Description metres Registered Owner as at No. 6, Jalan Waja 7, Freehold 2-storey 1,280 Multi-Code Electronics 1,991,768 Kawasan Perindustrian (7 years) semi-detached Industries (M) Berhad Pandan, Johor Bahru, factories Johor Darul Takzim. No. 8, Jalan Waja 7, Freehold 2-storey 1,280 Multi-Code Electronics 1,991,768 Kawasan Perindustrian (7 years) semi-detached Industries (M) Berhad Pandan, Johor Bahru, factories Johor Darul Takzim. HS(D) to Freehold 6 continuous 893 Multi-Code Electronics 3,430,107 PTD34424 to (3 years) units of Industries (M) Berhad Mukim of Tebrau, District of 3-storey Johor Bahru, State of Johor. shop/office No. 24, Lebuh Pulau Pinang Freehold 4 1/2 storey 240 Multi-Code Electronics 2,026,926 Pusat Perniagaan NBC, (4 years) shop/office Industries (M) Berhad Batu 1 1/2, Jalan Meru, Klang, Selangor. No. 2, Jalan Waja 7, Freehold 2-storey 1,281 Multi-Code Electronics 2,570,269 Kawasan Perindustrian Pandan, (7 years) semi-detached Industries (M) Berhad Johor Bahru, factories Johor Darul Takzim. No. 4, Jalan Waja 7, Freehold 2-storey 1,280 Multi-Code Electronics 2,259,200 Kawasan Perindustrian Pandan, (7 years) semi-detached Industries (M) Berhad Johor Bahru, factories Johor Darul Takzim. No. 10, Jalan Permatang, Freehold 1 1/2 storey 641 Multi-Code Electronics 539,770 Taman Desa Jaya, (6 years) semi-detached Industries (M) Berhad Johor Bahru, workshop Johor Darul Takzim. No. 12, Jalan Permatang, Freehold 1 1/2 storey 641 Multi-Code Electronics 539,770 Taman Desa Jaya, (6 years) semi-detached Industries (M) Berhad Johor Bahru, workshop Johor Darul Takzim. No. 6, Jalan Permatang 17, Freehold 1 1/2 storey 641 Multi-Code Electronics 539,905 Taman Desa Jaya, (6 years) semi-detached Industries (M) Berhad Johor Bahru, workshop Johor Darul Takzim.

31 31 LIST OF PROPERTIES (Cont'd) Tenure Area (approximate in square Net Book Value Location age of building) Description metres Registered Owner as at No. 8, Jalan Permatang 17, Freehold 1 1/2 storey 641 Multi-Code Electronics 539,905 Taman Desa Jaya, (6 years) semi-detached Industries (M) Berhad Johor Bahru, workshop Johor Darul Takzim. No. 33, Jalan Permatang 21, Freehold 2-storey 143 Multi-Code Electronics 192,215 Taman Desa Jaya, (6 years) terrace house Industries (M) Berhad Johor Bahru, Johor Darul Takzim. No. 15, Jalan Kakak Tua, Freehold Single-storey 186 Multi-Code Electronics 124,920 Taman Eng Ann, (33 years) terrace house Industries (M) Berhad Klang, Selangor. Off Sungai Rasah, Freehold 3 continuous 453 Multi-Code Electronics 855, Klang, Selangor. (7 years) units of 2-storey Industries (M) Berhad HS(M)No 2845 to 2847 terrace light PT No 494 to 496 industrial (Lots to 13284) buildings No. 7, Jalan Waja 8, Freehold 1 1/2 storey 1,366 Multi-Code Electronics 1,851,209 Kawasan Perindustrian Pandan, (7 years) semi-detached Industries (M) Berhad Johor Bahru, factories Johor Darul Takzim. No. 92 & 92A, Jalan Meranti Freehold 2-storey 156 Beaucar Accessories 822,803 Taman Melodies, (17 years) shophouse (M) Sdn Bhd Johor Bahru, Johor Darul Takzim.

32 32 SHAREHOLDING STATISTICS AS AT 24 OCTOBER 2000 SHARE CAPITAL : Authorised 50,000,000 : Issued & Paid Up 39,647,000 CLASS OF SHARES : Ordinary Share of 1 each VOTING RIGHTS : One vote per Ordinary Share DISTRIBUTION OF SHAREHOLDINGS Size of Holdings No. of Shares Percentage No. of Holders Percentage 1-1,000 1,518, , ,001-5,000 1,635, ,001-10, , ,001 and above 35,972, ,647, , TWENTY LARGEST SHAREHOLDERS No. Name No. of Shares Percentage 1. GOH TONG HUAT 6,271, AMANAH RAYA NOMINEES (TEMPATAN) SDN BHD 6,000, SKIM AMANAH SAHAM BUMIPUTERA 3. CHANG CHOON CHANG CHU CHEN 5,916, GOH CHAI SIONG 3,206, ARAB-MALAYSIAN FINANCE BERHAD 2,196, PLEDGED SECURITIES ACCOUNT FOR REGENSI MOTOR SDN BHD 6. MAYFIN NOMINEES (TEMPATAN) SDN BHD 2,100, PLEDGED SECURITIES ACCOUNT FOR GOH TONG HUAT 7. PENINSULA NOMINEES (TEMPATAN) SDN BHD PLEDGED SECURITIES ACCOUNT FOR GOH TONG HUAT 1,546, MAYFIN NOMINEES (TEMPATAN) SDN BHD PLEDGED SECURITIES ACCOUNT FOR ESTATE OF ONG SEE GOH SEE CHUAN 1,200, PEODALAN NASIONAL BERHAD 1,200, ARAB-MALAYSIAN NOMINEES (TEMPATAN) SDN BHD ARAB-MALAYSIAN FINANCE BERHAD FOR GOH TONG HUAT 1,010, ARAB-MALAYSIAN NOMINEES (TEMPATAN) SDN BHD ARAB-MALAYSIAN FINANCE BERHAD FOR ESTATE OF ONG SEE GOH SEE CHUAN 988, PENINSULA NOMINEES (TEMPATAN) SDN BHD PLEDGED SECURITIES ACCOUNT FOR LEE PUAY HENG 733, LEE SEONG SAN 547, LEE SIEW KIAT 456, ARAB-MALAYSIAN FINANCE BERHAD PLEDGED SECURITIES ACCOUNT FOR YEE ENG KING 449, KOTA BHARU SECURITIES SDN BHD 335, CHENG PAO-YUAN 256, AMANAH RAYA NOMINEES (TEMPATAN) SDN BHD AMANAH SAHAM SELANGOR 200, NG GEK HOON 129, ARAB-MALAYSIAN FINANCE BERHAD PLEDGED SECURITIES ACCOUNT FOR MOHD ARIFF BIN MOHD NOOR 122, TOTAL 34,863,