XPRS Xpress Annual Report 2010 - Expanding Asia-Pacific Footprints

Expanding Footprints
ASIA PACIFIC
Xpress Holdings Ltd Annual Report
2010
Expanding ASIA PACIFIC Footprints
CONTENTS
01 02 03 04 06 08 09 10 12 13 17 18 25 F 01 Vision & Mission Financial Highlights Milestones Achievements Regional Footprints Company Prole Corporate Information Chairmans Statement Letter from the AC Chair Board of Directors Key Management Operations Review Corporate Governance Financial Statements
e tagline, meant literally to be Expanding the Xpress footprints in the Asia-Paci c region describes the companys ambition to further develop its already entrenched position in the region. Xpress Holdings is a leading global nancial and commercial printer with an established presence in the Asia-Paci c region through its network of Print Stations. Already present in 19 major cities, with 38 spots in the region, it intends to further extend its outreach, as depicted by the concentric circles of strength advancing toward the continent on the cover design. And this, is the rst stage of the companys strategic three-year roadmap.
Xpress Holdings Ltd Annual Report 2010
VISION
To be the industry leader in time-sensitive printing services with unsurpassed reputation for speed, absolute reliability and uncompromising quality.
MISSION
To exceed customer expectations through service excellence and product innovation; reach and surpass shareholder expectations by striving for new growth and cost efciencies; develop employee potential by providing a challenging, but safe and happy work environment; be considerate to supplier needs by being fair and reasonable; and be socially and environmentally conscious, and where possible, to positively contribute back to the society.
Financial Highlights
GROUP FINANCIALS AT 31 JULY INCOME STATEMENT Revenue Operating EBITDA* Prot before income tax Net prot after tax and minority interests BALANCE SHEET Total assets Net tangible assets Total equity Total liabilities Cash and cash equivalents Per Share Data (Singapore cents) Earnings per share - basic and diluted Net dividend (Final) Net dividend (Special) Net tangible assets Return on average shareholders equity 0.55 0.06 5.1 5.9% 0.93 0.11 0.04 5.2 10.20% 0.74 0.13 3.36 9.6% 0.54 0.12 2.73 7.6% 0.52 0.10 1.50 10.0% 164,678 78,517 143,001 21,677 10,772 165,819 80,558 145,042 20,777 10,775 142,882 46,865 111,349 31,533 12,813 120,498 38,148 102,632 17,866 3,323 113,186 19,863 84,347 28,839 7,543 59,545 8,476 8,916 8,470 54,999 8,927 10,291 13,025 61,290 10,861 10,311 1 0,234 35,907 9,350 6,891 7,087 28,210 8,559 6,142 4,949 2010 $000 2009 $000 2008 $000 2007 $000 2006 $000
*Operating EBITDA is dened as prot before tax excluding nancing costs, depreciation, amortization and non-operating income.
GROUP REVENUE ($M)

61.3 55.0 59.5
2009
55.0 mil
2010
59.5 mil
35.9 28.2
8% 12%
2006
2007
2008
2009
2010
OPERATING PROFIT ($M)

9.6
5.7 4.8 4.2 4.7
4.2 mil
4.7 mil
2006
2007
2008
2009
2010
Milestones
2008
Revenue in 2008 S$61.3 Mil Launch of On-Site Print Stations 3 new Print Stations in China Wuhan, Xiamen and Changsha Signed 3 years Print Management contracts worth RMB200m annually with 7 major PRC media companies Signed 2 years Print Management contracts worth RMB140m annually with 6 major PRC publishers in Hunan province Sale and leaseback of Kallang Way building for S$14m Achieved PSO certication for Xpress Print in Singapore
2009
Revenue in 2009 S$55.0 Mil Attained record Net Prot for the Group S$13.0 Mil Business focus on high margin print management services Raised S$12.1 Mil in net proceeds through 160 million new ordinary shares Fully redeemed Convertible Bonds and halved the Groups gearing Sale of 10.1% equity stake in associated company Achieved PSO Certication for Xpress Print in Shenzhen
2010
Revenue in 2010 S$59.5 Mil Operating Prot rose by 11.9% Disposal of 10% equity stake in Jiaxinda Invested in short print run facility in Beijing Launch of street-level Print Station at 80 Robinson Road in Singapore Awarded the Overall Winner of the Established Brands category at the Singapore Prestige Brand Award, 2009 Awarded The Best Innovation Solutions Suppler of the Year 2009 by GE China Awarded the Business Superbrands status for 2010
2011

in Focus
Re-focus on our core strengths of delivering incredible speed and uncompromised quality Emphasise on print-on-demand projects that allow us to deepen our relationship with existing customers, and winning new ones Setting up more street-level Print Stations within the central business districts across the Asia Pacic region to attract walk-in trafc Develop retail (walk-in) clients to larger corporate clients Develop high value corporate clients to become VIP accounts with embedded On-Site Print Stations right at their premises Develop synergistic partnerships or joint ventures with corporations possessing extensive regional networks
Achievements
Xpress Holdings Ltds outstanding achievements have been recognised locally and internationally, in recognition of our excellence in creativity and processes. Our accreditations and recent awards include:
ACCREDITATIONS
PROCESS STANDARD OFFSET PSO CERTIFICATION
PSO is an internationally recognised quality management certi cation in global standard graphic technology for o set printing accredited by Fogra. In 2008, Xpress Print Pte Ltd was the rst in Singapore to be certi ed. In 2009, our Shenzhen o ce became the rst in China to be certi ed. is system de nes the requirements from pre-press to print for predictable and reliable print quality to ensure faster turnaround time and high print quality with consistent and reproducible colour output across all print locations.
FOREST STEWARDSHIP COUNCIL FSC CERTIFICATION

Committed to the protection of the environment, Xpress adopted eco-friendly print processes which include the use of recycled/certi ed papers and soy-based inks to reduce wastage. In 2008, we were accredited with the Forest Stewardship Council (FSC) certi cation. FSC is an international, independent, non-governmental, nonpro t organisation established to promote the responsible management of the worlds forests to meet the social, economic and ecological needs of present and future generations.
AWARDS
SINGAPORE PRESTIGE BRAND AWARDS 2009
e Singapore Prestige Brand Award recognises and honours Singapore brands that have developed and managed their brands e ectively, and have become the sterling brand names in Singapore. In December 2009, Xpress Holdings Ltd was awarded the Overall winner of the Established Brands.
THE BEST INNOVATION SOLUTIONS SUPPLIER OF YEAR 2009 AWARD

Xpress Holdings Ltd was presented with the award by the General Electric (GE) China during their inaugural all-China GE procurement conference in Pudong, China on 22 July 2010. e award recognises Xpress excellent consultative customer service and Print Station infrastructure. For GE China, Xpress developed innovative solutions to allow GE Chinas management to achieve central control of print processes and quality across multiple locations.
BUSINESS SUPERBRANDS AWARD 2010

Superbrands Singapore launched Business Superbrands in 2010. Xpress Holdings Ltd was identi ed as one of the strongest examples of B2B brands in the local market and was awarded the Singapure Business Superbrands status for 2010.
Regional Footprints
For Xpress to thrive in this challenging industry, it has to be a leader in the print industry regionally. We have presence in 19 cities across the AsiaPacic region, where our Print Stations and OnSite Print Stations are linked to a robust network of print facilities.
Xpress China Footprints
Our network of Print Stations is strategically linked to print factories located within a 15 18 hour radius road transport distance.
Company Prole
Established in 1986, Xpress was listed on the SGX Mainboard on 28 June 1999. With its headquarters in Singapore, the Groups sta strength of 450 is united by its core values and commitment to excellence and quality. e Group o ers the full range of print management services that include conceptualisation, design, copywriting, translations, typesetting and colour proo ng; printing; post-press packaging; global distribution and delivery. Xpress agship Print Stations, its sales and service centres, are strategically located at the heart of the business districts in the key cities of China, Vietnam, the Philippines, Malaysia, Hong Kong, Australia and Singapore. Supported by a comprehensive network of printing facilities, Xpress Print Stations provide clients easy-access to print services at quick-turnaround time in close proximities. e On-Site Print Stations provide an extension of its services by bringing them right to the clients premises. Products of Xpress include nancial research reports, annual reports, asset management reports, IPO prospectuses, corporate brochures, yearbooks, trade directories, magazines and other commercial publications and collaterals. With innovative use of technology, Xpress will continuously revolutionise the pace of competition in the printing industry and raise the standards of customer service by o ering unsurpassed convenience, quality, speed and reliability to its customers.
Corporate Information
BOARD OF DIRECTORS
Dr Wang Kai Yuen Independent and Non Executive Chairman Mr Fong Kah Kuen @ Foong Kah Kuen Chief Executive O cer / Executive Director Mr Darlington Tseng Te-Lin Executive Director Mr Victor Khoo Choon Meng Executive Director Mr Christopher Chong Meng Tak Independent Director Ms Ong Wui Leng Alternate Director to Mr Christopher Chong Meng Tak Mr Lai Hock Meng Independent Director Dr Lee Tsu-Der Non Independent and Non Executive Director Mr Jerry Lee Yin Chia Non Independent and Non Executive Director Mr Sam Chong Keen Non Independent and Non Executive Director
AUDIT COMMITTEE
Mr Christopher Chong Meng Tak (Chairman) Dr Wang Kai Yuen Mr Jerry Lee Yin Chia Mr Lai Hock Meng
SECRETARY
INVESTMENT AND RISK MANAGEMENT COMMITTEE
Ms Yeo Poh Noi Caroline

REGISTERED OFFICE
No 1 Kallang Way 2A Communications Techno Centre Singapore 347495 Tel: (65) 6880 2828 Fax: (65) 6274 1980 Website: www.xpress.sg
SHARE REGISTRAR
Boardroom Corporate & Advisory Services Pte. Ltd. 50 Ra es Place #32-01 Singapore Land Tower Singapore 048623
AUDITORS
Foo Kon Tan Grant ornton, CPA 47 Hill Street #05-01 Chinese Chamber of Commerce Building Singapore 179365
AUDIT PARTNER-IN-CHARGE
Mr Christopher Chong Meng Tak (Chairman) Dr Wang Kai Yuen Mr Jerry Lee Yin Chia Mr Sam Chong Keen Mr Lai Hock Meng
NOMINATING COMMITTEE
Mr Robin Chin Sin Beng (Appointment since nancial year ended 31 July 2006)
Principal Bankers
United Overseas Bank Limited e Development Bank of Singapore Ltd Malayan Banking Berhad Company Registration No. 199902058Z
Dr Wang Kai Yuen (Chairman) Mr Christopher Chong Meng Tak Mr Jerry Lee Yin Chia
REMUNERATION COMMITTEE
Dr Wang Kai Yuen (Chairman) Mr Sam Chong Keen Mr Lai Hock Meng
Chairmans Statement
Dear Shareholders
It gives me great pleasure to present the annual report for Xpress Holdings Ltd (Xpress or the Group) for the nancial year ended 31 July 2010 (FY2010). Building on strong foundations, our Group performed well on many fronts in FY2010. As well as recording signi cant increases in our revenue and operating pro ts, we made signi cant strides forward, toward our goal of transforming into a global leader in time-sensitive print solutions.
Digitisation and the Proliferation of Content
e digital age has brought forward a new explosion in the production of content, driving publishing from being the province of the few, to the domain of the many. is is driving a large source of potential new revenue, as the market transforms, from a push to pull model. Traditionally, publishers have printed in large volume runs, pushing content onto consumers. Today, a large and growing section of our business is for smaller, more personalised and speedier print runs where demand is pulled by the consumer. is emergent trend o ers tremendous new opportunities for Xpress to leverage our vast experience in time-sensitive print solutions. Importantly, the key factors for success in this business are attributes that Xpress has in abundance, namely a focus on client service, innovation and talent.
Financial Performance
Our Group performed well in FY2010, despite increased competition and di cult economic conditions. is demonstrates the strength of our business strategy and the commitment of our talented sta in executing our strategic plan. Group revenue increased 8.3% to $59.5 million in FY2010. is was solid growth given our transformation to being Print Managers means that we book in only our share of revenues from projects, as compared to the past where we booked in gross revenues on projects where we acted as the main printer. Operating pro t rose by 11.9% to $4.7 million, up from $4.2 million in the prior year. e Group recorded a lower gain from sale of investments, and also did not record any tax write-backs during the year. In addition as we reduced our shareholding in one of our print partners, we did not book in any associate income during the year. As a result, net pro t for FY2010 was $8.5 million. is compares to $13.0 million in the prior year, which bene ted from the items described earlier.
Becoming a Global Leader in Print Solutions
Printing remains the single most e ective and cost e cient branding tool available to businesses today. Xpress has long been a brand of choice in the region and we have put into action strategies to leverage our brand assets and experience to capitalise on our leadership position within the region.
Our strategic roadmap focuses on three primary objectives. ese are: i) Geographical expansion; ii) Building on our hallmarks for unsurpassed quality and speed; and iii) Deepening of our engagement with our clients. Our Group has identi ed a strategy to target these three focus areas concurrently. By building many more Print Stations at street level in major commercial districts as well as setting up On-Site Print Stations within VIP clients premises, we simultaneously expand our coverage, deliver superior service and deepen our client engagement. To date we have built a strong network of 38 print stations in 19 cities across China, Singapore, Malaysia, Vietnam, the Philippines, Indonesia and Australia. Our On-Site Print Stations have also been successfully deployed within the premises of high value clients such as General Electric and Wilmar in the PRC, providing them with unparalleled service and convenience. Our strategic roadmap is driven by Mr. Fong Kah Kuen, the founder of Xpress, who took up the post of Chief Executive O cer in May 2010, following his return from the PRC where as the Chief Operating O cer, he spearheaded the Groups highly successful market entry and business development initiatives. We are con dent our business model will further build our leadership position across the Asia-Paci c region and put us on the path towards becoming a global leader in printing solutions. e strength of our business model and our brand presence has already been recognised with Xpress being honoured with a number of prestigious awards, including being named as the Overall Winner of the Established Brands Award category at the 2009 Singapore Prestige Brand Awards. is is testament to the strength of our business model, which simultaneously provides exceptional service, speed and value added printing solutions to our clients. To support our strategic initiatives, the Group disposed of 10% of our equity interest in Shenzhen Jiaxinda Co., Ltd
(Jiaxinda), incorporated in the PRC, for an aggregate consideration of RMB 37.5 million or approximately S$7.7 million. ese shares were held as an available for sale investment, and the sale reduces our equity stake in Jiaxinda from 19.9% to 9.9%.
Dividend
e Board of Directors has proposed a full and nal dividend of 0.06 cent per share for FY2010, as compared to 0.11 cent per share declared in the prior year. is re ects the lower non-operational gains made in FY2010 and our desire to preserve cash for future expansion opportunities that may arise.
Outlook
Our Group is well poised to reap the bene ts of our earlier investment in capital and human resources to transform our business. Our momentum is continuing to build and we are energized by the opportunities we see to create signi cant shareholder value in the coming years.
Our success would not be possible without the contributions of many. On behalf of my colleagues, I take this opportunity to extend my deep appreciation to our valued shareholders, clients, business associates and sta for their continued support and contributions during this period. I look forward to working closely with each of you as we scale our Group to even greater heights in the years ahead. Last and certainly not least, we extend our sincere thanks to Mr Poh Eng Seng, who retired as CEO and Executive Director this year. Mr Poh made invaluable contributions to our growth and expansion since 2007, and we are grateful he has agreed to serve as Advisor to the Board after his retirement.
anks and Appreciation
Dr Wang Kai Yuen
Independent Non-Executive Chairman 15 October 2010
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Letter from the Audit Committee Chair

I am pleased to sign this, the second letter from your Audit Committee (AC). ank you for the positive responses to last years letter. It is nice to know that our e orts to promote shareholder and stakeholder communications have been appreciated. One of the main challengers that faces management, when pursuing high margin business in China, is the lengthy working capital cycle. e situation is likely to get tougher as current PRC e orts to rein in credit, intensi es. To get good discounts, we need to pay for raw materials up front. is, coupled with production timelines and the China market practice of giving 150 days to 180 days credit, result in working capital cycles that exceed 200 days. is means that for every dollar of China sales, Xpress needs some 55 cents of working capital. As such, the AC has paid signi cant attention to, as well as expanded much e ort in ensuring adequate & appropriate funding, credit risk assessment and receivables. It has also discussed with the Board some strategies for minimising such cycles including a better balance of work (e.g. better revenue mix by doing more print management work), and sharing the funding and the margin with strategic print partners. Besides print management, Xpress is also exploring the high valueadd digital printing business segment. e AC and IRMC (Investment & Risk Management Committee) have approved capital investment during the year to further this business. To ensure that the debt-equity ratio remains healthy and to better maximise shareholder value, the Board authorised a management team to explore and report the feasibility of raising capital, by listing additional securities in another market. e teams work was closely monitored by the AC. e team recommended, and was authorised to set in train a secondary listing on the Taipei Stock Exchange. However, subsequent to the teams recommendation, the Taiwanese authorities made changes to the rules that will require further, and signi cant studies by the AC and the IRMC. Consequently, the plan for a secondary listing on the Taipei Stock Exchange has been temporarily suspended until such work is complete. e AC has close relationships with both our external and internal auditors, as well as our legal advisers. As per the ACs standard practice, it speaks to both auditors independently several times a year. For example and with respect to the latest nancial results, the AC Chair met with the external auditor for several hours. is meeting occurred prior to the commencement of the formal AC and Board meeting, to discuss management letter points, other audit issues, the new management information system and likely changes in the business environment of the year ahead. e AC Chair then followed up with a conference call with the internal auditors. e Board believes that corporate governance is a matter of culture and has directed the AC to recommend a training policy, at the same time consider a code of ethics, an enterprise risk management system and an environmental impact policy. is work is currently in progress. e business of the Company continues to grow despite the global nancial crisis and the current PRC credit squeeze. However, success brings with it other risks and dangers. Risks and dangers that AC is cognisant of.
Audit Committee Chairman 15 October 2010
Mr Christopher Chong Meng Tak
Board of Directors
Dr Wang Kai Yuen
Independent Non-Executive Chairman Dr Wang Kai Yuen was appointed as Independent Non-Executive Chairman on 25 March 2002. He chairs the Nominating Committee and Remuneration Committee, and is also a member of the Audit Committee. Formerly the Managing Director of Fuji Xerox Singapore Software Centre, he interacted with senior business and product development managers in the US, China and Japan of the global o ce equipment company. He retired from Fuji Xerox in December 2009. Because of his extensive exposure overseas, Dr Wang is familiar with American and Asian cultures, international business practices and corporate nance and governance. Dr Wang had also participated in many international meetings of parliamentarians during his tenure as Member of Parliament from 1984 to 2006. He has wide business and political contacts in China, having led many grassroots delegations to visit numerous city and state governments. In 2005, Dr Wang was appointed as a Member in the Foreign Specialist Committee Overseas Chinese A airs O ce of the State Council, Peoples Republic of China. Dr Wang graduated in 1972 with First Class Honours degree in Electrical and Electronics from the National University of Singapore, and holds a Master of Science in Electrical Engineering with a PhD in Engineering from Stanford University.
K K Fong PBM
Founder, CEO & Executive Director, Xpress Holdings Ltd Mr K K Fong (Fong Kah Kuen) was appointed as Chief Executive O cer & Executive Director on 16 May 2010. He has over 30 years of experience in the printing industry and served Xpress as its Chief Operating O cer since 2006. Based in Shenzhen, he was responsible for the general management of the Group and the promotion of its activities and expansion in the region. Mr K K Fong plays a pivotal role in setting the strategic direction for the Group and has been instrumental in the Groups expansion, particularly in the Peoples Republic of China (PRC). He is also responsible for forging the strategic relationships with the Groups major business partners. He spearheaded the business development in the PRC and built up the Groups robust print solution business, the engine of growth for Xpress. He is a recipient of various national business awards such as the National IT Award, the Enterprise of the Year Award, Enterprise 50 Awards, and the Entrepreneur of the Year Award. For his contributions to Singapore, he was conferred the Public Service Medal by the President of the Republic of Singapore in 2009.
Dr Wang Kai Yuen
Mr K K Fong
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Board of Directors
Darlington Tseng Te-Lin
Executive Director Mr Darlington Tseng was appointed as Executive Director on 1 March 2008. He joined Xpress on 2 July 2007 as Director of Business Development for Greater China. Prior to joining Xpress, Mr Tseng was holding a senior executive position at BASF Taiwan Ltd, from 2005 to 2007. He gained extensive knowledge of the regions business climate during his tenure with BASFs regional business unit, where he collected vast market analyses and formulated strong marketing strategies. Between 1998 and 2002, Mr Tseng was an Assistant Sales Manager with AGI Corporation where he helped the company increase its annual turnover by 20% through drastic expansion of the overseas markets, and successfully set up the specialty chemical producers new manufacturing plant in Mexico. With his extensive knowledge of the regional business climate, Mr Tseng is responsible for strategising the Groups penetration into the Greater China markets and is also involved in managing the development of the Groups service o erings and growth opportunities in the Asia-Paci c markets. To sustain the Groups continuing growth, he spearheaded the re-engineering of operations to strengthen the Groups business model, while enhancing customer service and attracting and nurturing talent. Mr Tseng graduated with Honours from Peking Universitys International Masters of Business Administration.
Victor Khoo Choon Meng

Executive Director Mr Victor Khoo was appointed as Executive Director on 1 March 2008. He is also the Director of Sales and Marketing, responsible for the management and supervision of the Groups sales and marketing plans. Mr Khoo rst joined Xpress in 1996 as an Account Manager, servicing the Groups nancial printing clients. He spearheaded Xpress Asset Management business, which continues to be a key product under the nancial printing market. During his tenure with Xpress, Mr Khoo has been exposed to strategic planning, sales and senior management roles. He has standardised Xpress sales and customer service methodologies, ensuring consistent products and services are o ered across all Print Stations. With vast experiences in account and project management, he is also directly involved in acquiring, servicing and retaining key strategic accounts of the Group. Mr Khoo graduated in 1994 with a Bachelor of Commerce degree in Finance and Marketing from Murdoch University, Western Australia.
Mr Darlington Tseng Te-Lin
Mr Victor Khoo Choon Meng
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Board of Directors
Christopher Chong Meng Tak
Independent Director Mr Christopher Chong, Independent Director and Chairman of the Audit and Risk Management & Investment Committees, was appointed on 5 December 2001. He was previously the CEO of HSBC Securities (Singapore) Pte Ltd and prior to that an Executive Director of Kay Hian James Capel Ltd. Mr Chong was a multi-award winning analyst, is a capital markets specialist and has signi cant expertise on Corporate Governance. Mr Chong is a partner of ACH Investments Pte Ltd, a specialist corporate advisory rm, and is an Independent Director of ASL Marine Ltd, Koda Holdings Ltd, Lorenzo International Ltd (listed on the Singapore Exchange), GLG Corp Ltd and Koon Holdings Ltd (listed on the Australian Securities Exchange). Mr Chong is a member of the Institute of Chartered Accountants of Scotland and a fellow of the HK Institute of CPAs, the Australian Institute of CPAs, the Australian Institute of Directors and the Singapore Institute of Directors. He is also a master stockbroker of SIDA. Mr Chong holds First Class Honours Bachelor of Science degree from the University College of Wales and an MBA from the London Business School. working with several listed companies in Singapore since 1992. Ms Ong held the position of Head of Issuer Regulation for the Singapore Exchange Limited (SGX) from 2005 to 2007. She currently holds directorships, including SiS International Holdings Limited and Heartware Network and is also the Executive Partner of BlackInk Corporate Partners Pte Ltd. Ms Ong holds a Bachelor of Science (Economics) in Management Studies from the University of London, United Kingdom and a Master of Practising Accounting from the Monash University, Australia.
Lai Hock Meng

Independent Director Mr Lai Hock Meng was appointed as an Independent Director on 1 March 2008. He spent more than 25 years in the nancial industry, including central banking, investment banking, private banking, stockbroking and private equity investments. Mr Lai rst started his career in the Monetary Authority of Singapore in 1980. He then moved on to the private sector and attained senior management position in various global institutions such as Deutsche Morgan Grenfell & Partners Securities, SocGen-Crosby Securities, Citigroup Private Bank and OCBC Private Bank. Presently, he is involved in private equity investments, and sits on board of several listed companies as independent director. A veteran investment banker, Mr Lai brings to the Group vast experience in the global nancial industry and extensive knowledge of the worlds capital markets. Mr Lai graduated with a Bachelor of Arts (Honours) degree in Economics from the University of Cambridge, UK. He is also a fellow of UK Chartered Institute of Marketing, and a Chartered Financial Analyst (CFA) of e CFA Institute in the United States of America.
Ong Wui Leng

Alternate Director to Mr Christopher Chong Meng Tak Ms Ong was appointed the Alternate Director to Mr Christopher Chong on 22 July 2009. She has more than 25 years of experience in corporate banking and corporate nance. Ms Ong gained some 10 years of corporate banking experience, having worked for two European banks in Singapore. Her corporate nance experience was gained from
Mr Christopher Chong Meng Tak
Mr Lai Hock Meng
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Board of Directors
Dr Lee Tsu-Der
Non-Executive Non-Independent Director Dr Lee Tsu-Der was appointed as Non-Executive NonIndependent Director on 15 December 2004. He brings with him extensive business experience and market knowledge of China, Taiwan and Hong Kong, and provides strategic development and investment guidance to the Group. With a medical background, Dr Lee joined H&Q Asia Paci c (Taiwan) in 1995 and served as the Chief Advisor for its China Investments. From 1995 to 1998, he played important roles in various key investments in China covering Pharmaceutical, Biotech, Media, and Consumer Goods industry. Between 1999 and 2003, Dr Lee served as the General Manager of H&Q Asia Paci c (China). He had also formerly served as the Chairman to Starbucks Co ee Beijing Limited, as well as Shan Dong Kexing Biotech Company. Dr Lee is currently the Vice Chairman of H&Q Asia Paci c (Taiwan), and an Independent Director for Hsu Fu Chi International Ltd. He obtained his medical degree in dentistry from Taipei Medical University in Taiwan and is now the Chairman of the Taipei Medical University. nancial knowledge and experience. Leveraging on his crossborder nancial service experience, Mr Lee has completed several sizeable investment and acquisitions in China. Mr Lee has a Bachelor degree in Finance from New York University and a MBA degree from Peking University in Beijing.
Sam Chong Keen

Non-Executive Non-Independent Director Mr Sam Chong Keen was rst appointed as an Independent Non-Executive Director on 5 December 2001. Between 2006 and 2008, he served the Group as the Chief Executive O cer, and was re-appointed as Non-Executive Non-Independent Director on 16 February 2008. Mr Sam has a wealth of management experience, having held senior/CEO positions in the Singapore Government Administrative Service, National Trades Union Congress, Intraco Ltd, Comfort Group Ltd, VICOM Ltd, Lion Asiapac Ltd, Lion Teck Chiang Ltd, Jade Technologies Holdings Ltd and Sino-Environment Technology Group Limited. Mr Sam was the Political Secretary to the Minister for Education from 1988 to 1991. He has served on various government boards and committees, including the Central Provident Fund Board and the National Co-operative Federation. Mr Sam holds a Bachelor of Arts in Engineering Science & Economics in Honours and a Master of Arts from University of Oxford, as well as a Diploma from the Institute of Marketing, United Kingdom.
Left to right: Dr Lee Tsu-Der, Mr Jerry Lee Yin Chia and Mr Sam Chong Keen
Jerry Lee Yin Chia

Non-Executive Non-Independent Director Mr Jerry Lee was appointed as Non-Executive Non-Independent Director on 15 December 2004. He has worked in various locations with focus on Corporate Finance and M&A, bringing to the Group extensive multinational
16
Key Management
Eleanor Fong Sau Kwan
Executive Director, Xpress Print Pte Ltd Ms Fong joined the Group in March 1992 and was appointed the Executive Director of Xpress Print Pte Ltd. She also served as an Executive Director for Xpress Holdings Ltd between 5 December 2001 and 26 February 2007. She brings to the Group concrete strengths in international relations and management expertise. Ms Fongs current responsibilities involve developing the Groups regional clientele, as well as oversee the activities of the sales and marketing department. University of Singapore and a Graduate Diploma in Personnel Management from the Singapore Institute of Management.
Ronnie Yo Ngan Kia

Group Financial Controller, Xpress Holdings Ltd Mr Yo joined the Group in 2007 and was appointed the Group Financial Controller in May 2009. He is responsible for the end-to-end nance operations. Functional responsibilities include nancial and management reporting, controls and compliance and strategic planning. In addition to his CPA and ACCA quali cations, Mr Yo graduated with a Bachelor of Science degree in Economics from University of London and holds a Master of Science degree in Accounting and Finance from De Montfort University.
Foong Sow Peng

Operations Director, Xpress Print Pte Ltd Ms Foong joined the Group in April 1995 and was appointed Operations Director of Xpress Print Pte Ltd. She is trained in factory management and holds a Diploma in Production Engineering from the Singapore Polytechnic. With over 30 years of experience in multinational corporations, Ms Foong is responsible for the Groups printing operations and publishing activities.
Wu Wei Dong
Chief Executive O cer, China Operations Mr Wu joined the Group in July 2007 as General Manager. He has in-depth knowledge of the PRC printing industry and extensive media contacts. He plays a crucial role in formulating strategies to bolster the Groups long term business expansion in the PRC and is also responsible for the nancial and operational procedures for the country. Mr Wu is an accounts graduate from Hunan Business College.
From left to right Ms Eleanor Fong Sau Kwan, Ms Foong Sow Peng, Ms Adeline Chee Choon Lee, Mr Ronnie Yo Ngan Kia and Mr Wu Wei Dong
Adeline Chee Choon Lee

Head of Human Resources & Administration, Xpress Holdings Ltd Ms Chee joined Xpress in March 1994 and is responsible for the Groups regional human resources. Her responsibilities include strategic human resource planning and recruitment. She holds a Bachelor of Arts degree from the National
17
Operations Review
Ful lled
VISION FUTURE
Unveiled
I am honoured that the Board of Directors has invited me to return as Chief Executive Ofcer, a post I accepted in May 2010. I regard my return to the helm of Xpress with a mixture of excitement and trepidation. But I am condent that with the collective efforts of the whole Xpress team, we will rise to the challenge and chart a new era of growth for our company.
18
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The Next Wave

Printing company Toppan is reinventing itself for the Digital Age by diversifying into a range of new businesses and markets.
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Biz IT The Business Times Published October 18, 2010
owerful rivals are entering our traditional area of business, says Shingo Kaneko, appointed president and CEO of $16 billion (1.5 trillion) Toppan Printing this June,
referring to the expansion of firms like Apple and Amazon into electronic books. Though he recognizes the structural difficulties confronting printing, Kaneko is resolutely upbeat. Do I think the future for Toppan is bleak? Absolutely not, he declares. For a start, Toppan has embraced digitization. Not only does the firm work with U.S.-based E Ink to produce key display components for e-book readers such as the Amazon Kindle and the Sony Reader, this May it joined Sony, the Asahi Shimbun newspaper, and telecom company KDDI to develop an open platform that will let Japanese publishers deliver content across a range of reading devices. Looking beyond printing, Kaneko has powerful reasons for his positive outlook. First, the printing technologies that Toppan has accumulated over its 110-year history make a solid foundation for diversifying into new niches. (Microfabrication skills based on printing technologies, for instance, were the basis of a move into electronics back in 1959, and Toppan is now the dominant producer of LCD color filters for TVs, cellphones, and PCs.) Second, Toppan has a roster of major global clients. Third, the skills of Toppan Groups more than 47,000 employees cover a broad spectrum: marketing, creative, IT, sales, and manufacturing. We have the resources. Theres no limit to what we can achieve by fine-tuning our business model, Kaneko explains. Now that the old print-based business model of massproducing a single product in response to customer orders is no longer sustainable, Kaneko wants to see the firm he heads become proactive, using its resources in a synergistic fashion to offer total solutions and building partnerships to move into new business domains. Toppans role in implementing the eco-point system, a $3 billion element of Japans recent economic stimulus package, neatly encapsulates the direction Kaneko wants the firm to take. In early 2009, the government wanted to spur consumption by incentivizing the purchase of energy-saving home appliances with eco-points that consumers could exchange for goods and services. Toppan, working with a subsidiary of Japan Post and the countrys largest advertising firm, was awarded the task of managing the complex nationwide reward system for the government, and had it up and running in under three months. Kaneko expects demand for similar business process outsourcing (BPO) projects to grow strongly in the future, with companies everywhere eager to cut costs and increase efficiency.
MPS market undergoes major restructuring
Cloud services are changing the way managed print services are offered and used, reports AMIT ROY CHOUDHURY
THE managed print services (MPS) market is undergoing a major makeover with an increased focus on services, according to a report by IT research agency IDC. Ms Narayan: The MPS market in Singapore is expected to be worth US$32 million by the end of this year IDC executive Suchitra Narayan observed that vendors are starting to expand service offerings either in-house or via partnerships to bring MPS to the boardroom.
This new focus is being reected in the market place. According to Ms Narayan, who is Asia Pacic research manager for IDCs IT Services Research, the Singapore market is expected to be worth US$32 million by the end of this year. More importantly, she told BizIT, the market is expected to expand at a compound annual growth rate (CAGR) of 12.9 per cent till 2014. Ms Narayan added that in the Asia Pacic, excluding Japan (APEJ) region, the MPS market is forecast to grow at a CAGR of 17 per cent in the period 2010-2014. It will reach US$530 million in 2010 and surpass US$990 million in 2014. IDC expects the growth to be especially strong in China and India, assuming political stability in these markets.
The Past A Strategic Overview

Having founded Xpress in 1986 and led the Company for many years, I believe it is important to set out to shareholders the context of our growth and development for the last ve years. As shareholders will recall, we undertook a major transformation with the acquisition of the Precise Media Group (PMG) in 2006, establishing a geographical footprint in China which did not exist earlier for Xpress. I have been directly involved in the formation and growth of PMG since 2002 when I stepped down from the Xpress board. Hence, I have the unique bene t of not just growing Xpress in its formative years (since 1986), but also developing PMG, witnessing its injection into Xpress, and seeing the fruits of the last ve years of integration. e Greater China region is now the largest market for Xpress. But to see the signi cance purely in geographical
Collaboration wa scheme, and Kaneko Toppans future. Al build up significant Toppans current str Since 2005 its been for next-generation technology transfer giving it the rights t mean its been manu since 2009. This May it established Ortus light-emitting diode When the oppor to make acquisitions purchased Singapor years ago and estab has large-capacity p prints 70% of the to Toppan posted a bo business developme aging market. Our lion (500 billion) China by 2015, Kan ing change and over through Toppans hi
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terms is to miss the wider strategic picture of what we have achieved. To carve a niche in China, PMG, and later Xpress e ectively disrupted part of the print industry in the country by o ering major customers a turnkey solution, with a fresh proposition embedding an Xpress Print Station within the clients premises. To compliment this and support smaller clients, we also o er close to you Print Stations emphasising digital printing. e latter strategy initially adopted in China and stress-tested in a challenging and fragmented market has been re ned and adopted across the whole Group, including Singapore. e net e ect is that we now have a network of Print Stations (38), print partners, a technologyintensive solution and a track record of world-class VIP clients. All these are the outcome of a continuing ve-year plan implemented in 2006 upon the acquisition of PMG, to position ourselves as a major player rede ning printing across the region.
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Operations Review
To recap the key strategic achievements since 2006:

2006 China and Beyond
Acquired remaining 40% of PMG that we did not own (making it a 100% subsidiary) after a placement of new shares which raised S$21.5 million; and Incorporated Xpress Print Shenzhen which now serves as the headquarters of our Greater China operations.
China... and Beyond...
Annual Report 2006
2007 Beyond China Going Global

Appointed key managers to drive PRC strategy; Incorporated Xpress Print Shenyang, thus widening our PRC footprint to North China; and Signed major clients in PRC and formed joint-venture for translation services.
Xpress Holdings Ltd
Xpress Holdings Ltd
Annual Report 2007
Beyond China...
Going Global
Print Stations in China
Harbin
Changchun Shenyang Beijing Tianjin Dalian

Beyond China...
Going Global
Chengdu
No. 1 Kallang Way 2A Singapore 347495 Tel: +65 6880 2828 Fax: +65 6880 2720 www.xpressholdings.com
Shanghai Wuhan Changsha Xiamen Guangzhou Shenzhen Dongguan Hongkong
Chongqing
Nanning
Existing Print Stations Future Print Stations
Annual Report 2007 Bangkok Beijing Changsha Chengdu Doha Ho Chi Minh City Hong Kong Jakarta Kuala Lumpur Manila Melbourne Seoul Shanghai Shenzhen Shenyang Singapore Suzhou Sydney Taipei
2008 Consolidation Strengthening Foundations

Signed long-term print management agreements with 13 major PRC media companies and publishers, establishing our credentials as a major player; Set up new Print Stations in Wuhan, Xiamen and Changsha; Secured accreditation with Forest Stewardship Council Chain of Custody; and Attained the PSO (ISO 12647-2) certification (validation for the best practice achievement of international standardisation of graphic technology for colour printing) for Xpress Print Singapore.
XPRESS HOLDINGS LTD
2009 Print Evolution New Global Alliances

Enlarged Print Station network to 32; Shifted business focus to high-margin print management services (VIP clients); Raised S$12.1 million in net proceeds from share placement; fully redeemed convertible bonds issued in 2007 and halved the Groups gearing; and Achieved PSO certification for Xpress Print Shenzhen.
New Global Alliances
e soundness of the Groups strategic decisions is underpinned by the management teams foresight, judgment and acute sensitivity to changes in market trends honed by over thirty years experience. e goals and strategies established in each years annual report evince the Groups ability to meet new challenges constantly.
ANNUAL REPORT 2009
XPRESS HOLDINGS LTD ANNUAL REPORT 2009
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Operations Review
The Present Review of FY2010 Performance

Having outlined the vision of the last four years, allow me now to focus on our performance in the year under review. FY2010 was a year of challenges for Xpress as the regional print industry continued to be impacted by adverse conditions brought about by the recent global nancial crisis and the Euro sovereign debt crisis. Consolidation within the industry has already set in, accelerated by higher paper prices, sti er competition and cost pressures. Nonetheless, the Group was successful in delivering yet another year of pro ts and continues to make signi cant progress in executing plans to position Xpress as AsiaPaci cs leading provider of time-sensitive print solutions.
The major challenges sweeping the printing industry call for further changes in the way we operate.
Contribution by Geographical Regions
China continues to be Xpress core base of operations and accounted for 69.6% of total revenue. Consistent with the current economic climate and our continued expansion in the PRC, revenue for FY2010 rose to S$41.5 million from S$38.2 million a year ago. Xpress operations in Singapore continue to grow despite increasing competition. Revenue contributions from Singapore accounted for 21.3% of total revenue, with sales for FY2010 higher at S$12.7 million compared to S$11.4 million for FY2009. While the PRC market remains the key driver of the Groups revenue growth, our operations in Malaysia, Hong Kong, Australia and other countries in the Asia-Paci c region remain vibrant and continue to contribute positively to the overall revenue and pro tability of the Group.
Print Station at the Weld, Kuala Lumpur
Business Development and International Partnerships
During the year, Xpress successfully secured the rights to be the exclusive print vendor for some of our high value clients, such as GE China. For these clients, Xpress manages all their printing needs, providing them with comprehensive print solutions that include on-site services like conceptualisation, design & layout, digital printing at their premises, o -site commercial printing, as well as access to Xpress extensive logistics and distribution network. We also forged an alliance with London-based print management leader HH Associates (HH). e collaboration leverages on Xpress Print Station network in Asia and taps into HHs large US and European client base. rough HH, Xpress will be able serve foreign clients seeking to enter Asian market and at the same time, refer Asian clients with international print needs. Moving forward, it is the Groups intention to continue exploring synergistic partnerships with international print players to further expand our global outreach.
Print Station at the 80 Robinson Road, Singapore
Signing Ceremony with HH Associates

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Operations Review
In addition, we entered into collaboration with Ra es Education Corporation Limited (REC), the largest private education group in the Asia-Paci c region. By setting up On-Site Print Stations in RECs extensive campus network, this partnership allows us to increase our penetration into more strategic cities in the Asia-Paci c, with less time and capital outlay. An internship program for REC students is also being planned. Early this year, we moved our town o ce in the CBD area to a 5,000-square-foot street level Print Station at 80 Robinson Road, a prime location at the heart of Singapore. is is the rst of a series of street-level concept Print Stations planned for launch throughout the region to increase the Xpress brand visibility and are at the forefront of our strategy to develop our relationship with new and existing clients.
Mr Poh Eng Seng speaking at the Ra es Inernational College in Vietnam
Awards, Acknowledgements and Accolades
Xpress receiving the award at the 2009 Singapore Prestige Brand Award ceremony
We are pleased to inform shareholders that Xpress received a number of distinguished awards in the year under review. ese include the overall winner of the Singapore Prestige Brand Award 2009, Established Brands, which honours Singapore brands that have become sterling brand names in Singapore and e International ARC Awards 2009, where Xpress won a total of nine awards for its excellence in design. At the same time, identi ed as one of the strongest examples of B2B brands in the local market by Superbands Singapore, we were awarded the Singapore Business Superbrands status for 2010. In July 2010, Xpress received e Best Innovation Solutions Supplier of the Year 2009 award from GE China. e award recognises Xpress excellent consultative customer service and Print Station infrastructure, as well as the work we put into developing innovative solutions to allow their management to centrally control print processes and quality across multiple locations.
Mr Darlington Tseng receiving award from GE China
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Operations Review
am very about the future I believe IXpress canpositiveregional, possibly even a global be a leader, in its niche.
The Future
Asia-Pacific
2010 - 2013
Since returning as CEO, I have presented a three-year strategic roadmap to the Board of Directors, which has been approved. e major challenges sweeping the printing industry call for further changes in the way we operate. Recognising this, the Groups major strategic initiatives under this roadmap will be in the following areas: First, we need to re-focus on our core strengths to deliver uncompromising speed and quality. ese attributes helped Xpress succeed in the past and remain the pillars of our future
Print
growth. In line with this, we will need to emphasise shortprint run projects that will allow us to retain existing and win new customers. Second, we will widen our reach in major cities across the Asia-Paci c, which will include setting up more streetlevel Print Stations. Clearly branded and located at central business districts, these service and print stations allow us to attract walk-in tra c which can be developed into larger clients. is geographical rollout had begun for several years. Apart from increasing the number of our locations, we are now relocating and rebranding existing locations to strengthen our corporate presence. Currently we have 38 Print Stations in 19 cities. ird, we will seek to strengthen our unique value proposition to clients. As customers walk into Print Stations, our speed and quality as well as depth of services are the competitive edge we have to build our business. As with high value customers, we may embed an Xpress team within such clients premises, so as to provide them fully customised print solutions.
ree-Year Roadmap
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Operations Review
To recap our annual goals for the next three years:

First Stage
While focusing on China, we will relocate Print Stations to street levels of business districts to increase visibility, with a view to transforming walk-in clients into corporate clients. rough companies with regional networks such as Ra es Education Corp, we intend to build a network of On-Site Print Stations across Asia-Paci c.
is architecture allows us to electronically beam a print order to multiple locations, ful lling the promise of uncompromising speed and quality and deriving substantial savings in logistics. ere are no direct comparables, in terms of competitors, that have attained our reach and proven track record in executing such a business model. Underpinned by our strong presence in the Asia-Paci c region, and particularly the PRC I am con dent that the three-year roadmap will not only lead Xpress to a new era of healthy growth, but also enable us to be the entrenched market leader of the region in the longer term, beyond 5 years. Going forward, we will also continue to actively review and evaluate prospective mergers and acquisitions and seek international partnerships with industry players who complement Xpress existing businesses and can contribute to our future growth. I am very positive about the future I believe Xpress can be a regional, possibly even a global leader in its niche.
Second Stage
After establishing critical mass of Print Stations and VIP clients we intend to scale up and grow the business volume in the region.
Leveraging on our brand equity and continued expansion, we seek to become the leader in the time-sensitive print industry with the biggest network in the region, with top-of-mind brand recall. As with the earlier ve-year plan, this three-year roadmap is ambitious but necessary. For this strategy to succeed, our senior must have an unrelenting focus for speed, quality and customer service. Recognising this, my role as CEO will include grooming managers for our next stage of growth. For Xpress to thrive in this challenging industry, it has to be a leader in the print industry regionally, if not globally. We already have presence in 19 cities across the region. Our Print Stations and On-Site Print Stations are linked to a robust network of print factories and third-party print partners.
ird Stage
K K Fong PBM
Chief Executive O cer 15 October 2010
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Corporate Governance
The Board of Directors (the Board) is committed to enhancing long-term shareholder value and in ensuring high standards of corporate governance to protect the interests of shareholders and adheres to the principles and guidelines set out in the Code of Corporate Governance 2005 (the Code). Where there are deviations from the Code, appropriate explanations are provided. A. Board Matters The Boards Conduct of its Affairs Principle 1: Every company should be headed by an effective Board to lead and control the company. The Board is collectively responsible for the success of the company including the enhancement of long-term shareholder value. The Board works with Management to achieve this and the Management remains accountable to the Board. The Board oversees the processes for evaluating the adequacy of internal controls, risk management, nancial reporting, performance evaluation, compliance and other monitoring and feedback responsibilities. It also approves the board policies, group strategies and nancial objectives of the Company. Major acquisitions are also approved at Board level. To facilitate effective management, certain functions have been delegated by the Board to various Board Committees. The Board Committees operate under clearly dened terms of reference. The Chairman of the respective Committees will report to the Board on the outcome of the Committee meetings. The Board conducts regular scheduled meetings during the year. Ad-hoc meetings are convened when circumstances require. Article 99(2) of the Companys Articles of Association permits meetings of the Directors to be conducted by means of telephone conference or other methods of simultaneous communication by electronic or telegraphic means. A record of the Directors attendances at Board and Board Committee meetings during the nancial year ended 31 July 2010 is disclosed as follows:
Board Name of Director No. of Attendance meetings Dr Wang Kai Yuen Mr Poh Eng Seng (1) Mr Fong Kah Kuen (2) Mr Christopher Chong Meng Tak Mr Sam Chong Keen Dr Lee Tsu-Der Mr Jerry Lee Yin Chia Mr Khoo Choon Meng Mr Darlington Tseng Te-Lin Mr Lai Hock Meng 4 4 4 4 4 4 4 4 4 4 4 3 1 4 4 4 4 4 4 4 No. of meetings 4 Not Applicable Not Applicable 4 4 Not Applicable 4 Not Applicable Not Applicable 4 Attendance 4 Not Applicable Not Applicable 4 4 Not Applicable 4 Not Applicable Not Applicable 4 Audit Committee Nominating Committee No. of meetings 3 Not Applicable Not Applicable 3 Not Applicable Not Applicable 3 Not Applicable Not Applicable Not Applicable Attendance 3 Not Applicable Not Applicable 3 Not Applicable Not Applicable 3 Not Applicable Not Applicable Not Applicable Remuneration Committee No. of meetings 3 Not Applicable Not Applicable Not Applicable 3 Not Applicable Not Applicable Not Applicable Not Applicable 3 Attendance 3 Not Applicable Not Applicable Not Applicable 3 Not Applicable Not Applicable Not Applicable Not Applicable 3 Investment and Risk Management Committee No. of meetings 4 Not Applicable Not Applicable 4 Not Applicable Not Applicable 4 Not Applicable Not Applicable 4 Attendance 4 Not Applicable Not Applicable 4 Not Applicable Not Applicable 4 Not Applicable Not Applicable 4
Note:
(1) (2)
Mr Poh Eng Seng retired as an Executive Director and CEO of the Company on 15 May 2010. Mr Fong Kah Kuen was appointed as an Executive Director and CEO of the Company on 16 May 2010.
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At meetings and as and when necessary, the directors are provided with regular updates on changes in the relevant laws and regulations to enable them to make well-informed decisions. Where possible and when opportunity arises, the directors will be invited to locations within the Groups operating businesses to enable them to obtain a better perspective of the business and enhance their understanding of the Groups operations. The Company will be considering formulating policies on a Code of Ethics, training programmes for Directors and Senior Executives, the environment and on other matters of importance. Board Composition and Guidance Principle 2: There should be a strong and independent element on the Board, which is able to exercise objective judgement on corporate affairs independently, in particular, from Management. No individual or small group of individuals should be allowed to dominate the Boards decision making. During the year, Mr Fong Kah Kuen, the Companys founder, took over as the CEO and Executive Director of the Company on 16 May 2010 from Mr Poh Eng Seng, who retired as the Companys CEO and Executive Director at the end of his contract with effect from 15 May 2010. Following his retirement, Mr Poh was appointed as an Advisor to the Board. Three out of the total nine Directors on the Board are independent, in accordance with the Codes denition of independent director and guidance as to the existence of relationships which would deem a director not to be independent. The Board comprises the following members:
Director Dr Wang Kai Yuen Christopher Chong Meng Tak (Ong Wui Leng as alternate director) Lai Hock Meng Fong Kah Kuen Darlington Tseng Te-Lin Khoo Choon Meng Dr Lee Tsu-Der Jerry Lee Yin Chia Sam Chong Keen* Function Chairman of the Board Non-Executive, Independent Non-Executive, Independent Non-Executive, Independent Executive Director Chief Executive Ofcer Executive Director Executive Director Non-Executive, Non-Independent Non-Executive, Non-Independent Non-Executive, Non-Independent Appointment Date 25 March 2002 8 June 1999 5 December 2001 23 January 2009 1 March 2008 16 May 2010 1 March 2008 1 March 2008 15 December 2004 15 December 2004 16 February 2008
*Sam Chong Keen was CEO and Executive Director of the Company for two years immediately prior to this appointment. The Company has a good balance of directors who have extensive business, nancial, accounting and management experience. The diverse and objective judgment of the independent and non-executive directors on corporate affairs and their experience and contributions are valuable to the Company. The proles of the Directors are set out on page 13 to 16 of this annual report. The Boards structure, size and composition are reviewed annually by the Nominating Committee who is of the view that the size of the Board in FY2010 was appropriate, taking into account the nature and scope of the Groups operations, to facilitate effective decision making. The Nominating Committee is satised that the Board comprises directors who, as a group, provide core competencies such as accounting, nance, business and management experience, industry knowledge, strategic planning experience and customer-based experience and knowledge to lead the Company effectively.
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Chairman and Chief Executive Ofcer Principle 3: There should be a clear division of responsibilities at the top of the company the working of the Board and the executive responsibility of the companys business which will ensure a balance of power and authority, such that no one individual represents a considerable concentration of power. The Company practices a clear division of responsibilities between the Chairman and the Chief Executive Ofcer (CEO) since its listing on the Singapore Exchange Limited in 1999. This ensures an appropriate balance of power between the Chairman and the CEO and thereby allows for increased accountability and greater capacity of the Board for independent decision-making. The Chairman and the CEO are not related to each other. The primary role of the Chairman, who performs a non-executive function, is to lead the Board effectively in all aspects, promote high standards of corporate governance and ensure that the directors receive accurate, timely and clear information. The Chairman also encourages regular and effective communications between the Board and Management, among the directors, and the shareholders. The CEO implements the Boards strategic directions and ensures compliance with regulatory standards and corporate governance guidelines. The CEO also manages the daily running of the Groups operations. The CEO is assisted by an Executive Committee. Board Membership Principle 4: There should be a formal and transparent process for the appointment of new directors to the Board. The Nominating Committee (NC) is established for the purposes of ensuring that there is a formal and transparent process for all Board appointments. The NC comprises the following three members, the majority of whom are independent non-executive directors:Dr Wang Kai Yuen Mr Christopher Chong Meng Tak Mr Jerry Lee Yin Chia (Chairman) (Member) (Member)
The NC has adopted written terms of reference dening its membership, administration and duties. Some of the duties and responsibilities of the NC include: a) to make recommendations to the Board on all board appointments having regard to the directors contribution and performance; b) determining annually whether or not a director is independent; and c) deciding whether a director is able to and has adequately carried out his duties as a director of the Company in particular where the director concerned has multiple board representations. The NC has proposed to the Board and the Board has adopted the following policies: a. b. c. d. e. f. The Chairman should be an Independent or Non-Executive Director; That at least half the Board shall comprise of Non-Executive Directors; That at least one-third of the Board shall comprise of Independent Directors; The NC shall have the right to appoint such consultants as it deems necessary during a search for new directors; That appointment of Alternate Directors shall be in accordance with the Singapore Institute of Directors SGP 11/2010; and The implementation of a succession plan.
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The NC notes that: The Chairman is an Independent Director; Non-Executive Directors comprise two-thirds of the Board; Independent Directors comprise one-third of the Board; and Ms. Ong Wui Leng is an Alternate Director to Mr. Christopher Chong Meng Tak and her appointment was primarily to assist Mr. Chong and the Board with respect to listings. The Board is considering listing one or more of its subsidiaries and/or investments and has also considered whether to seek a secondary listing for the Company. Ms. Ong is assisting the Board in its deliberations and which adviser or consultant to appoint. Ms. Ong was previously the head of listing at the Singapore Exchange Limited. The NC is considering the following policies: a. a. That the performance of the Board shall be reviewed by a competent external party every third year. That a more comprehensive Directors training program be put in place.
Each member of our NC shall abstain from voting on any resolution in respect of his re-nomination as a director. The search and nomination process for new directors, if any, will be through search companies, contacts and recommendations that go through the normal selection process, to cast its net as wide as possible for the right candidates. The Companys Articles of Association requires one-third of the Directors or the number nearest to one-third, other than the Managing Director to retire by rotation at every Annual General Meeting (AGM). Board Performance Principle 5: There should be a formal assessment of the effectiveness of the Board as a whole and the contribution by each director to the effectiveness of the Board. The NC has established processes and objective performance criteria for evaluating the effectiveness of the Board. The performance criteria used by the Nominating and Remuneration Committee includes the evaluation of the size and composition of the Board, the Boards access to information, Board processes and accountability and the Boards performance in relation to discharging its principal functions and responsibilities, the directors standards of conduct and such nancial targets as the Nominating and Remunerations Committee considers appropriate. A Board Performance Evaluation exercise is conducted on an annual basis by our external corporate service provider and the ndings are presented to the NC and the Board. The Chairman of the NC would act on the results of the performance evaluation and where appropriate, propose new members be appointed to the Board or seek the resignation of directors, in consultation with other members of the NC. Each member of the NC shall abstain from voting on any resolution in respect of his performance as a director. Notwithstanding that some of the directors have multiple board representations, the NC is satised that each Director is able to and has been adequately carrying out his duties as a director of the Company. The Board and the NC have endeavoured to ensure that directors appointed to the Board possess the experience, knowledge and expertise critical to the Groups business. The NC has recommended that Mr Darlington Tseng Te-Lin, Mr Khoo Choon Meng and Mr Lai Hock Meng, who are retiring by rotation pursuant to Article 94 of the Companys Articles of Association, and Mr Fong Kah Kuen who is retiring pursuant to Article 76 of the Companys Articles of Association, to be re-elected/re-appointed at the forthcoming AGM.
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Access to information Principle 6: In order to fulll their responsibilities, Board members should be provided with complete adequate and timely information prior to Board meetings and on an on-going basis. Management provides the Board with adequate and timely information as well as a review of the Groups performance prior to the Board meetings. All Directors have separate and independent access to the Groups senior management and company secretary, should they have any queries on the affairs of the Group. Should the directors, whether as a group or individually, require independent professional advice, the Company will bear the expenses incurred if such advice is required to enable the directors to discharge their duties professionally. Prior to each Board and Board committee meeting, notice of meeting is issued to the Board and Board Committee members containing information on the agenda and documents to be reviewed. The Company Secretary attends all Board meetings and is responsible for ensuring the Board procedures are followed and that applicable rules and regulations (in particular the Companies Act and the SGX-ST Listing rules) are complied with. B. Remuneration Matters
Procedures for Developing Remuneration Policies Principle 7: There should be a formal and transparent procedure for developing policy on executive remuneration and for xing the remuneration packages of individual directors. No director should be involved in deciding his own remuneration. The Remuneration Committee (RC) is established for the purposes of ensuring that there is a formal and transparent process for developing policy and xing the remuneration packages of individual directors. The RC comprises the following three members, majority of whom are independent non-executive directors: Dr Wang Kai Yuen Mr Sam Chong Keen Mr Lai Hock Meng (Chairman) (Member) (Member)
The RC has adopted written terms of reference dening its membership, administration and duties. Some of the duties and responsibilities of the RC include: a) recommending to the Board a framework of remuneration for the Board and key executives; b) determining specic remuneration packages which should cover all aspects of remuneration including but not limited to directors fees, salaries, allowances, bonuses, options and benets-in-kind for each Executive Director, the CEO and senior management including but not limited to senior executives, divisional directors and those reporting directly to the Managing Director, Chairman, CEO and employees related to the executive directors and controlling shareholders of the Group; c) reviewing and recommending to the Board the terms of renewal of service contracts of directors; d) the RCs recommendations would be made in consultation with the Chairman of the Board and submitted for endorsement by the entire Board. e) administers the Companys Executive Share Option Scheme; f) to retain such professional consultancy rm as the committee may deem necessary to enable it to discharge its duties hereunder satisfactory; and g) considering the various disclosure requirements for directors remuneration, particularly those required by regulatory bodies such as the SGX-ST, and ensures that there is adequate disclosure in the nancial statements to ensure and enhance transparency between the Company and relevant interested parties. No Director has or shall participate in decisions on his own remuneration.
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Level and Mix of Remuneration Principle 8: The level of remuneration should be appropriate to attract, retain and motivate the directors needed to run the company successfully but the company should avoid paying more for this purpose. A signicant proportion of executive directors remuneration should be structured so as to link rewards to corporate and individual performance. It is the Groups policy to set a level of remuneration that is appropriate to attract, retain and motivate the directors. The independent non-executive directors receive directors fees in accordance with their level of contribution, taking into account factors such as effort and time spent and responsibilities of the directors. The Board may, if it considers necessary, consult experts on the remuneration of non-executive directors and would recommend the remuneration of the non-executive directors for approval at the AGM. The RC regularly reviews the level of remuneration to ensure that it is appropriate as compared to other listed companies of similar size and draws reference from market surveys such as the Non-Executive Directors Fees for 22 Singapore-listed Companies that was conducted by FreshWater Advisers in July 2009. The fees for non-executive directors are set in accordance with a remuneration framework recommended by the Singapore Institute of Directors. Non-executive Directors shall not be over-compensated to the extent that their independence may be compromised. It comprises two components basic fee and committee fee. They are paid only after obtaining approval from shareholders at the AGM. Executive directors do not receive fees for sitting on the Board and Board committees. Fee structure for non-executive directors $ Basic fee Board chairmanship AC chairmanship Other committee chairmanship AC membership Other committee membership Disclosure on Remuneration Principle 9: Each Company should provide clear disclosure of its remuneration policy, level and mix of remuneration and the procedure for setting remuneration in the Companys annual report. It should provide disclosure in relation to its remuneration policies to enable investors to understand the link between remuneration paid to directors and key executives, and performance. 30,000 25,000 20,000 6,000 4,000 2,000
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Breakdown of Directors remuneration for the current nancial year ended 31 July 2010: Executive Directors Poh Eng Seng* Darlington Tseng Khoo Choon Meng Fong Kah Kuen^ Non-Executive Directors Dr Wang Kai Yuen Dr Lee Tsu-Der Jerry Lee Yin Chia Christopher Chong Lai Hock Meng Sam Chong Keen Total Remuneration band $500,000 and above $250,000 to $499,999 Below $250,000 Salary (%) # 67 68 69 100 Fees $73,000 $30,000 $38,000 $58,000 $38,000 $36,000 $273,000 Bonus (%) 5
Bonus (%) 33 32 31 0
Number of employees who are immediate family members of the CEO in remuneration bands: Remuneration band 2010 Salary (%) # Below $250,000 2 95
There was no immediate family member of a director or the CEO whose remuneration exceeded S$150,000 during the nancial year other than the above. # includes leave pay, shared-based payments, car benets, employers CPF. * Mr Poh Eng Seng retired as CEO and Executive Director of the Company during the nancial year on 15 May 2010. ^ Mr Fong Kah Kuen was appointed as CEO and Executive Director of the Company during the nancial year on 16 May 2010. Details of share options granted to the directors are set out in the Directors Report on page F 02 to F 07 of this annual report. The Company has not disclosed the remuneration of its key executives as it is not in the best interests of the Company and the employees to disclose such details due to the sensitive nature of such information. C. Accountability and Audit Accountability Principle 10:The Board should present a balanced and understandable assessment of the companys performance, position and prospects. One of the Boards principal duties is to enhance and protect the long-term value and returns to the shareholders of the Company. The accountability of the Board to the shareholders is demonstrated through the presentation of the periodic nancial statements as well as the timely announcements and news releases of signicant corporate developments and activities so that the shareholders can have a detailed explanation and balanced assessment of the Groups nancial position and prospects. The Management presents to the Audit Committee the interim and full-year results. The Audit Committee reviews the results and recommends them to the Board for approval. The Board approves the results and authorizes the release of the results to the SGX-ST and the public via SGXNET as required by SGX-ST Listing Manual.
31
Audit Committee Principle 11: The Board should establish an Audit Committee (AC) with written terms of reference which clearly set out its authority and duties. The AC comprises the following ve members, majority of whom are independent non-executive directors:Mr Christopher Chong Meng Tak Dr Wang Kai Yuen Mr Jerry Lee Yin Chia Mr Sam Chong Keen Mr Lai Hock Meng (Chairman) (Member) (Member) (Member) (Member)
The prole of each member of the AC is set out on page 12 to xx of this report. The Board is of the view that the members of the AC are eminently qualied; having accounting or related nancial management expertise, industry experience or such other experience as the Board interprets such qualication, to discharge their responsibilities. As a sub-committee of the Board of Directors, it assists the Board in discharging their responsibility to maximize long-term shareholder value, safeguard our assets, maintain adequate accounting records, and develop and maintain effective systems of internal control, with the overall objective of ensuring that our Management creates and maintains an effective control environment in our Group. The AC will also review and supervise the internal audit functions of the Group. Our AC will provide a channel of communication between our Board, our Management and our external auditors on matters relating to audit. Our AC has adopted written terms of reference dening its membership, administration and duties. Duties and responsibilities of the AC include: a) review with external auditors the audit plan, their evaluation of the system of internal accounting controls, their letter to Management and the Managements response; b) review the interim and annual nancial statements and balance sheet and income statements before submission to our Board for approval, focusing in particular on changes in accounting policies and practices, major risk areas, signicant adjustments resulting from the audit, compliance with accounting standards and compliance with the Listing Manual and any other relevant statutory or regulatory requirements; c) review the scope and results of the audit and its cost effectiveness and the independence and objectivity of the external auditors. Where the auditors also provide a substantial volume of non-audit services to the Company, the AC would keep the nature and extent of such services under review, seeking to balance the maintenance of objectivity and value for money; d) review the internal control procedures and ensure co-ordination between the external auditors and our Management, and review the assistance given by our Management to the auditors, and discuss problems and concerns, if any, arising from the interim and nal audits, and any matters which the auditors may wish to discuss in the absence of our Management at least annually; e) review and discuss with the external auditors any suspected fraud or irregularity, or suspected infringement of any relevant laws, rules or regulations, which has or is likely to have a material impact on our Groups operating results or nancial position, and our Managements response; f) consider the appointment or re-appointment of the external auditors and matters relating to the resignation or dismissal of the auditors;
32
g) review interested person transactions (if any) falling within the scope of Chapter 9 of the Listing Manual; h) review potential conicts of interest, if any; i) j) undertake such other reviews and projects as may be requested by the Board, and will report to the Board its ndings from time to time on matters arising and requiring the attention of the AC; and Generally undertake such other functions and duties as may be required by statute or the Listing Manual, or by such amendments as may be made thereto from time to time.
In the event that any Director has a personal material interest in any contract or proposed contract or arrangement, he will abstain from reviewing that particular transaction or voting on the particular resolution. Apart from the duties listed above, the AC shall commission and review the ndings of internal investigations into matters where there is any suspected fraud or irregularity, or failure of internal controls or infringement of any Singapore law, rule or regulation which has or is likely to have a material impact on our Companys operating results and/or nancial position. In performing its functions, the AC has the right to commission any report that it deems responsible and required in discharging the duties of the AC. In performing its functions, the AC has explicit authority to investigate any matter within its terms of reference, having full access to and co-operation by Management and full discretion to invite any director or executive ofcer to attend meetings, and reasonable resources to enable it to discharge its function properly. In accordance with the Code, the AC has in place a whistle-blowing policy to provide arrangements whereby concerns on nancial improprieties or other matters raised by whistle-blowers may be investigated and appropriate follow up action taken. Under such whistle-blowing procedures, employees are free to submit complaints condentially or anonymously to the Chairman of the AC (chris@ach.to) who is well known to many employees and easily accessible. All complaints are to be treated as condential and are to be brought to the attention of the AC. Assessment, investigation and evaluation of complaints are conducted by or at the direction of the AC, if it deems appropriate, independent advisors engaged at the Groups expense. Following investigation and evaluation of a complaint, the AC will then decide on recommended disciplinary or remedial action, if any. The action so determined by the AC to be appropriate shall then be brought to the Board or to the appropriate members of Senior Executive for authorisation or implementation respectively. Internal Controls Principle 12: The Board should ensure that the Management maintains a sound system of internal controls to safeguard the shareholders investments and the companys assets. The Board ensures that Management maintains a sound system of internal controls to safeguard shareholders interest and the Groups assets, and to manage risks. The Board also acknowledges that no cost effective internal control system will preclude all errors and irregularities. A system is designed to manage rather than eliminate the risk of failure to achieve business objectives, and can provide only reasonable and not absolute assurance against material misstatement or loss. With the assistance of the Internal Auditors and through the AC, the Board reviews the effectiveness of the key internal controls, provides its perspective on management control and ensures that the necessary corrective actions are taken on a timely basis. There are procedures in place for both the internal and external auditors to report independently conclusions and recommendations to Management and the AC.
33
Investment and Risk Management Committee Focusing on the guidance of Principle 12 of the Code, the Investment and Risk Management Committee (IRMC) was established in 2008 to assist the Board in fullling its oversight responsibilities in investment and risk management. The IRMC comprises the following four members, three of whom are independent non-executive directors:Mr Christopher Chong Meng Tak Dr Wang Kai Yuen Mr Lai Hock Meng Mr Jerry Lee Yin Chia (Chairman) (Member) (Member) (Member)
The IRMC has adopted written terms of reference dening its membership, administration and duties. Some of the duties and responsibilities of the IRMC include: a) assisting the Board to set the risk-return prole of the Group. b) consider, evaluate, review and, if deemed t, recommend to the Board proposed investments, acquisitions and disposal of assets of the Company and its subsidiaries exceeding a dened threshold amount currently set at S$200,000 per unbudgeted investment or divestment; c) review and recommend to the Board proposed investments and acquisitions of the Company and its subsidiaries which do not fall within the Companys core businesses but which are considered strategic investments for the long-term prospects of the Company; d) reviewing, evaluating and approving the risk prole and risk mitigation strategies of each investment; e) reviewing, evaluating and approving procedures governing Companys investment activities and ensuring all decisions comply with all applicable laws, regulations and guidelines relating thereto; f) monitoring the processes of investment management to ensure that they are being implemented in a professional and controlled manner according to plan; g) reviewing the adequacy and completeness of the Companys risk management processes and recommend improvements where deemed necessary; and h) reviewing the Companys key material risks that have been identied by the risk management process and whether the response action plans being developed by Management are adequate to manage these risks to an acceptable level. In addition, the Group has also put in place appropriate risk management policies and processes to evaluate the operating, investment and nancial risks of the Group. In evaluating a new investment proposal or business opportunity, several factors will be considered by Management and the Board before a decision is being made. These factors, which are essentially designed to ensure that the rate of returns commensurate with the risk exposure taken, including evaluating (i) return on investment; (ii) the pay back period; (iii) cash ow generation and certainty of cash ow generation from the operation; (iv) potential for growth; (v) specic risk; (vi) market and sector risk; and (vi) other risk such as country stability. The main areas of nancial risks faced by the Group are foreign exchange risk, interest rate risk, credit risk and liquidity risk. Further details of the nancial risks and how the Group manages them are set out in note 28 of the nancial statements.
34
Internal Audit Principle 13: The Company should establish an internal audit function that is independent of the activities it audits. The Company has outsourced its internal audit function. The scope of internal audit is to: review the effectiveness of the Groups internal controls; provide assurance that key business and operational risks are identied and managed; internal controls are in place and functioning as intended; and operations are conducted in an effective and efcient manner.
The internal auditors are able to meet the standards set by nationally or internationally recognized bodies, including the Standards for the Professional Practice of Internal Auditing set by The Institute of Internal Auditors. The annual internal audit plan is prepared in consultation with, but independently of Management, and submitted to the AC for approval. The internal auditors report directly to the AC. Communication with Shareholders Principle 14: Companies should engage in regular, effective and fair communication with shareholders. The Company endeavours to communicate regularly, effectively and fairly with its shareholders. Timely, as well as, detailed disclosure in plain English is made to the public in compliance with SGX-ST guidelines. The Company does not practice selective disclosure and endeavours not to use overly technical or legal language. All price sensitive information is announced on the SGXNET on a timely basis. Shareholders and other investors are provided regularly with: 1. An Annual Report; 2. Quarterly nancial results and other nancial announcements as required; 3. Periodic powerpoint presentation on the state of the Group; 4. Press releases and other announcements on important developments; and 5. A website and portal (www.xpress.com.sg); and 6. The presence of all members of Senior Management at the AGM. In the last nancial year, the Group released 4 reports and announcements or on average 1 per quarter. Financial results, annual reports, press releases on the performance and major developments in the business and operations of the Group and any other material announcements are released through SGXNET and are available on the Companys website. The Company also engages external investor relation consultant rm to support the Group in promoting the communication with shareholders and investment community. The Group also holds analyst brieng and entertains personal visits from investors and the brokerage industry. Principle 15: Companies should encourage greater shareholder participation at AGMs, and allow shareholders the opportunity to communicate their views on various matters affecting the Company. All shareholders of the Company receive the annual report of the Company and notice of AGM within the mandatory period. Participation of shareholders is encouraged at the Companys general meetings. To facilitate
35
voting by shareholders, the Companys article allows shareholders to appoint not more than two proxies to attend and vote at the same general meeting. The Board of Directors (including the Chairman of the respective Board committees), Management, as well as the external auditors will attend the Companys AGM to address any questions that shareholders may have. D. Dealings In Securities The Company has adopted an Internal Compliance Code on Securities Transactions to Directors and key employees (including employees with access to price-sensitive information to the Companys shares by these persons) of the Group setting out the code of conduct on transactions in the Companys shares by these persons, the implications of insider trading and the recommendations of the Best Practices Guide issued by the Singapore Exchange Securities Trading Limited. The Internal Compliance Code also prohibits dealings in securities of the Company by directors and employees during the period commencing at least 4 weeks before the announcement of the half-year and full-year nancial results, and two weeks before the announcement of the rst and third quarter results and ending on the date of the announcement. E. Interested Person Transaction
The Board had reviewed all interested person transactions for the nancial year ended 31 July 2010 and was satised that the transactions were conducted at arms length and do not require any immediate announcement or obtain shareholder approval as dened under the Listing Rules. F. Material Contracts
Pursuant to Rule 1207(8) of the Listing Manual, the Company conrms that there was no material contract entered into between the company and its subsidiaries which involved the interests of any director or controlling shareholder, either still subsisting at the end of the nancial year or if not then subsisting, which was entered into since the end of the previous nancial year. SGX Checklists The Board has accepted and uses the following checklist when required: Acquisitions and Realisations Compliance checklist. Annual Report Compliance checklist. Bonus Issue Compliance checklist. Financial Results Review checklist. Placement Compliance checklist. Rights Issue Compliance checklist. Share Split Compliance checklist.
36
Financial Contents
Directors Report Statement by Directors Independent Auditors Report Statements of Financial Position Consolidated Income Statement Consolidated statement of Comprehensive Income Consolidated Statement of Changes in Equity Consolidated Statement of Cash Flows Notes to the Financial Statement Statistics of Shareholdings Shareholders Information Notice of Annual General Meeting Proxy Form F 02 F 08 F 09 F 11 F 12 F 13 F 14 F 15 F 16 F 61 F 62 F 63 F 67
Expanding AsiA-PAcific Footprints
Directors Report
For the financial year ended 31 July 2010
The directors submit this annual report to the members together with the audited consolidated financial statements of the Group and statement of financial position of the Company for the financial year ended 31 July 2010. DIRECTORS The directors in office at the date of this report are: Dr Wang Kai Yuen Fong Kah Kuen Darlington Tseng Te-Lin Khoo Choon Meng Chong Meng Tak, Christopher Lai Hock Meng Dr Lee Tsu-Der Jerry Lee Yin Chia Sam Chong Keen (Chairman) (Chief Executive Officer- Appointed on 16 May 2010) (Alternate Director, Ong Wui Leng)
The alternate director performs the same functions as all other directors of the Company, including attendance of all board of directors meetings. ARRANGEMENTS TO ACQUIRE SHARES OR DENBENTURES During and at the end of the financial year, neither the Company nor any of its subsidiaries was a party to any arrangement the object of which was to enable the directors to acquire benefits through the acquisition of shares in or debentures of the Company or of any other corporate body. DIRECTORS INTEREST IN SHARES OR DEBENTURES According to the Register of Directors Shareholdings kept by the Company for the purposes of Section 164 of the Companies Act, Chapter 50, particulars of interests of directors who held office at the end of the financial year (including those held by their spouses or infant children) in shares and share options of the Company and its related corporations are as follows: Holdings in the name of the director, spouse and/or infant children
At beginning of the year / Date of appointment The Company Ordinary shares fully paid Dr Wang Kai Yuen Chong Meng Tak, Christopher * Fong Kah Kuen @ Foong Kah Kuen ** Darlington Tseng Te-Lin Khoo Choon Meng 845,000 15,032,830 30,081,000 11,153,000 360,000 845,000 15,032,830 30,081,000 11,153,000 360,000 At end of the year
F 02
Directors Report
DIRECTORS INTEREST IN SHARES OR DEBENTURES (CONTD) Other holdings in which the director is deemed to have an interest
At beginning of the year / Date of appointment At end of the year 77,539,000 137,943,313
Fong Kah Kuen @ Foong Kah Kuen ** Dr Lee Tsu-Der ***
77,539,000 137,943,313
Holdings in the name of the director, spouse and/or infant children

At beginning of the year / Date of appointment Options to subscribe for ordinary shares exercisable between 25.06.2002 and 24.06.2011 at an exercise price of $0.0723 per share Khoo Choon Meng Options to subscribe for ordinary shares exercisable between 11.12.2004 and 10.12.2013 at an exercise price of $0.0733 per share Khoo Choon Meng Options to subscribe for ordinary shares exercisable between 01.03.2008 and 28.02.2017 at an exercise price of $0.1650 per share Khoo Choon Meng Options to subscribe for ordinary shares exercisable between 10.03.2009 and 09.03.2018 at an exercise price of $0.1200 per share Darlington Tseng Te-Lin Khoo Choon Meng Options to subscribe for ordinary shares exercisable between 22.9.2009 and 21.09.2013 at an exercise price of $0.0700 per share Dr Wang Kai Yuen Chong Meng Tak, Christopher Lai Hock Meng Dr Lee Tsu-Der Jerry Lee Yin Chia Sam Chong Keen Options to subscribe for ordinary shares exercisable between 20.10.2009 and 19.10.2018 at an exercise price of $0.05 per share Darlington Tseng Te-Lin Khoo Choon Meng 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 300,000 300,000 200,000 200,000 150,000 150,000 At end of the year
F 03
Directors Report
* **
DIRECTORS INTEREST IN SHARES OR DEBENTURES (CONTD) Chong Meng Tak, Christopher has a total beneficial interest in 15,032,830 shares out of which 5,132,830 shares are held in the name of a nominee. Mr Fong Kah Kuen @ Foong Kah Kuen was appointed as a Director of the Company on 16 May 2010. Mr Fong is deemed to be interested in the 77,539,000 shares held by K K Fong Holdings Pte Ltd by virtue of Section 7 of the Act. Dr Lee Tsu-Der is deemed to be interested in the 137,943,313 shares held by Triumph Development Holdings Limited by virtue of Section 7 of the Companies Act, Chapter. 50.
***
There was no change in any of the above-mentioned interests in the Company between the end of the financial year and 21 August 2010. DIRECTORS BENEFITS Since the end of the previous financial year, no director has received or has become entitled to receive a benefit under a contract which is required to be disclosed under Section 201(8) of the Companies Act, Chapter 50, except as disclosed above and that certain directors received remunerations from related corporations in their capacity as directors and/or executives of those related corporations. SHARE OPTIONS a) Pursuant to the approval by the members of the Company at the Extraordinary General Meeting held on 25 June 2001, the Company adopted Xpress Holdings Executives Share Option Scheme 2001 (the SOS). It provides an opportunity for the executives of the Group who have contributed significantly to the growth and prosperity of the Group to participate in the equity of the Company. According to the revised Terms of Reference of the Remuneration Committee (RC), the SOS is administered by the RC. The members of the RC are as follows: Dr Wang Kai Yuen (Chairman) Lai Hock Meng Sam Chong Keen c) The number of options available under the SOS shall not exceed 15% of the total issued shares of the Company on the day preceding the relevant date of grant.
b)
Options granted under the SOS to full-time employees and executive directors of the Group shall be subject to an option period of 10 years, commencing from the date of grant and expiring on the day immediately preceding the 10th anniversary of the date of grant. The non-executive directors of the Group shall be subject to an option period of 5 years commencing from the date of grant and expiring on the day immediately preceding the 5th anniversary of the date of grant. The options are exercisable on the first anniversary of the date of grant. Unissued ordinary shares of the Company under options are as follows:
F 04
Directors Report
SHARE OPTIONS (CONTD)

Granted during the year Lapsed during the year Exercised during the year
Date of grant
Balance at 01.08.2009
Balance at 31.07.2010
Exercise price
Expiry date
25.06.2001 25.06.2001 07.12.2001 07.12.2001 30.06.2003 11.12.2003 04.12.2006 01.03.2007 10.03.2008 22.09.2008 20.10.2008 24.06.2009
230,000 224,000 350,000 65,000 400,000 331,000 4,100,000 3,300,000 8,000,000 22,000,000 8,000,000 1,000,000 48,000,000
(12,000) (50,000) (62,000)
230,000 212,000 350,000 65,000 400,000 281,000 4,100,000 3,300,000 8,000,000 22,000,000 8,000,000 1,000,000 47,938,000
$0.0754 $0.0723 $0.0500 $0.0550 $0.0550 $0.0733 $0.1783 $0.1650 $0.1200 $0.0700 $0.0500 $0.0850
24.06.2011 24.06.2011 06.12.2011 06.12.2011 29.06.2013 10.12.2013 03.12.2016 28.02.2017 09.03.2018 21.09.2013 19.10.2018 23.06.2019
No options were granted during the financial year (2009: 31,000,000). No options were exercised during the financial years ended 31 July 2009 and 2010.The weighted average remaining contractual life of share options outstanding at the end of the year is 5.3 (2009: 6.3) years. At 31 July 2010, 47,938,000 (2009: 17,000,000) options were exercisable. d) Information of directors of the Company participating in the SOS is as follows:
Aggregate options granted since commencement of SOS to the beginning of the financial year Aggregate options granted since commencement of SOS to the end of the financial year
Name of participants
Options granted during the financial year
Aggregate options exercised since commencement of SOS to the end of financial year
Aggregate options outstanding at end of the financial year
Dr Wang Kai Yuen Darlington Tseng Te-Lin Khoo Choon Meng Dr Lee Tsu-Der Christopher Chong Meng Tak Lai Hock Meng Khoo Choon Meng Jerry Lee Yin Chia Sam Chong Keen
2,000,000 4,000,000 4,650,000 2,000,000 2,000,000 2,000,000 4,650,000 2,000,000 2,000,000 25,300,000
2,000,000 4,000,000 4,650,000 2,000,000 2,000,000 2,000,000 4,650,000 2,000,000 2,000,000 25,300,000
2,000,000 4,000,000 4,650,000 2,000,000 2,000,000 2,000,000 4,650,000 2,000,000 2,000,000 25,300,000
F 05
Directors Report
SHARE OPTIONS (CONTD) e) f)
Since the commencement of the SOS, no participant under the SOS has been granted 5% or more of the total options available under the Scheme. These options do not entitle the holder to participate, by virtue of such holdings, to any right to participate in any share issue of any other corporation. Except as disclosed above, there were no unissued shares of the Company or its subsidiaries under options granted by the Company at the end of the financial year.
AUDIT COMMITTEE The Audit Committee (AC) comprises the following non-executive directors: Chong Meng Tak, Christopher Chairman (Alternate Director Ong Wui Leng) Dr Wang Kai Yuen Lai Hock Meng Jerry Lee Yin Chia Sam Chong Keen The AC performs the functions specified by section 201B of the Companies Act, the Listing Manual and the Best Practices Guide of the Singapore Exchange Securities Trading Limited (SGX-ST) and the Code of Corporate Governance. Alternate Director performs the same functions as all other directors of the Company, including attendance of all AC meetings. These members of the AC have had many years of experience in senior management positions in both the financial and industrial sectors. They have sufficient financial management expertise and experience to discharge the ACs functions. The AC meets at least twice a year to perform the following key functions: recommends to the Board of Directors the external auditors to be nominated, approve the compensation of the external auditors, and review the scope and results of the audit, and its cost-effectiveness; reviews with the other committees, management and the external auditors, significant risk or exposures that exist and assess the steps management has taken to minimise such risks to the Company; reviews with the external auditors the findings of the annual audit; reviews with management annually: significant internal audit observations during the year and managements responses; the effectiveness of the Companys internal controls over management, business and technology systems practices; and any changes required in the planned scope of the audit plan and any difficulties encountered in the course of the audits;
reviews legal and regulatory matters that may have a material impact on the financial statements, related exchange compliance policies, and programmes and reports received from regulators; and reports activities and minutes of the AC to the Board of Directors with such recommendations as the AC considers appropriate.
F 06
Directors Report
AUDIT COMMITTEE (CONTD) The Audit Committee is satisfied with the independence and objectivity of the external auditors and has recommended to the Board of Directors that the auditor, Foo Kon Tan Grant Thornton LLP Certified Public Accountants, , be re-appointed as auditors at the forthcoming Annual General Meeting of the Company. INDEPENDENT AUDITOR The independent auditor, Foo Kon Tan Grant Thornton LLP Certified Public Accountants, has expressed their , willingness to accept re-appointment.
On behalf of the Directors
WANG KAI YUEN Chairman
FONG KAH KUEN Chief Executive Officer
Dated: 21 October 2010
F 07
Statement by Directors
In the opinion of the directors, (i) the consolidated financial statements of the Group and the statement of financial position of the Company as set out on pages F 11 to F 60 are drawn up so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 July 2010 and of the results, changes in equity and cash flows of the Group for the financial year ended on that date; and at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they fall due.
(ii)
WANG KAI YUEN Chairman
FONG KAH KUEN Chief Executive Officer
Dated: 21 October 2010
F 08
Independent Auditors Report

We have audited the accompanying financial statements of Xpress Holdings Ltd (the Company) and its subsidiaries (the Group), which comprise the statements of financial position of the Group and the Company as at 31 July 2010, the consolidated income statement, the consolidated statement of comprehensive income, the consolidated statements of changes in equity and the consolidated statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes. Managements responsibility for the financial statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the provisions of the Singapore Companies Act, Chapter. 50 (the Act) and Singapore Financial Reporting Standards. This responsibility includes: (a) devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair income statements and balance sheets and to maintain accountability of assets; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.
(b) (c)
Auditors responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from 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 the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entitys 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 entitys internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, 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.
F 09
Independent Auditors Report

Opinion In our opinion: (a) the consolidated financial statements of the Group and the statement of financial position of the Company are properly drawn up in accordance with the Act and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 July 2010 and the results, changes in equity and cash flows of the Group for the year ended on that date; and the accounting and other records required by the Act to be kept by the Company and by those subsidiaries incorporated in Singapore of which we are the auditors, have been properly kept in accordance with the provisions of the Act.
(b)
Foo Kon Tan Grant Thornton LLP Public Accountants and Certified Public Accountants Singapore, 21 October 2010
F 10
Statements of Financial Position

As at 31 July 2010
Group 2010 Note Assets Non-Current Goodwill Plant and equipment Investments in subsidiaries Investment in associate Amounts due from subsidiaries Available-for-sale financial assets Current Inventories Trade and other receivables Amounts due from subsidiaries Amount due from related party Cash and cash equivalents Total assets Equity Capital and reserves Share capital Reserves Total equity attributable to equity holders of the Company Minority interests Total equity Liabilities Non-Current Interest-bearing borrowings Finance lease liabilities Deferred tax liabilities 15 16 17 1,761 1,208 2 2,971 Current Trade and other payables Amounts due to subsidiaries Interest-bearing borrowings Finance lease liabilities Income tax payable Total liabilities Total equity and liabilities 18 7 15 16 9,379 8,454 859 14 18,706 21,677 164,678 9,359 6,057 906 355 16,677 20,777 165,819 1,811 10,097 56 2 11,966 12,115 129,225 1,286 7,950 56 150 9,442 9,649 129,625 2,168 1,930 2 4,100 149 149 207 207 13 14 100,390 42,432 142,822 179 143,001 100,390 44,479 144,869 173 145,042 100,390 16,720 117,110 117,110 100,390 19,586 119,976 119,976 9 10 7 11 12 889 64,720 10,772 76,381 164,678 592 55,292 10,775 66,659 165,819 6,817 9,365 5,155 21,337 129,225 8,199 16,121 2 5,429 29,751 129,625 3 4 5 6 7 8 64,484 16,156 7,657 88,297 64,484 18,078 16,598 99,160 284 78,582 21,380 7,642 107,888 405 78,582 4,304 16,583 99,874 $000 2009 $000 Company 2010 $000 2009 $000
The accompanying notes form an integral part of these financial statements

F 11
Consolidated Income Statement

Year ended 31 July 2010 Note Revenue Other income Total revenue Costs and expenses Changes in inventories of raw materials and consumables Raw materials and consumables used Depreciation of plant and equipment Staff costs Other operating expenses Non-operating income Share of associates results Foreign exchange loss, net Interest income Finance costs Profit before taxation Taxation Profit after taxation Attributable to: Equity holders of the parent Minority interests 8,470 8,470 Earnings per share (cents) - Basic - Diluted 24 24 0.55 0.55 0.93 0.93 13,025 (19) 13,006 22(a) 22(b) 21(e) 23 4 21(b) 21(c) 21(d) 297 (29,990) (3,185) (11,898) (9,567) 4,343 (701) 56 (705) 8,916 (446) 8,470 87 (24,652) (3,173) (12,341) (10,486) 5,511 716 (472) 77 (974) 10,291 2,715 13,006 20 21(a) $000 59,545 721 60,266 Year ended 31 July 2009 $000 54,999 999 55,998
F 12
Consolidated Statement of Comprehensive Income

Year ended 31 July 2010 $000 Profit after taxation Other comprehensive income: Transfer of fair value gain of available-for-sale financial assets to profit or loss upon sale of investment Fair value gain on available-for-sale financial assets Translation differences arising from translation of available-for-sale financial assets Translation differences arising from translation of financial statements of foreign operations Translation differences arising from monetary items forming part of net investments in foreign operations Other comprehensive income for the year Taxation Total comprehensive income for the year Total comprehensive income attributable to: Equity holders of the parent Minority interests Total comprehensive income for the year 232 6 238 24,823 (32) 24,791 8,470 Year ended 31 July 2009 $000 13,006
(4,562) (1,222) (1,463) (985) (8,232) 238
10,279 1,612 (106) 11,785 24,791

F 13
F 14
Equity component of convertible bond Fair value reserve Retained profits $000 $000 $000 $000 Minority interests Total equity $000 (Note 4(a)) (Note 14(b)) (Note 4(c)) $000 $000 Currency translation reserve Share option reserve Total equity attributable to equity holders of the Company $000
Share capital
$000
(Note 13)
Balance at 1 August 2008 1,617 (1,617) (4,562) (3,676) 38 10,279 (302) 668 33,834 8,470 (2,317) 5,717 (3,978) 706 39,987 (1,800) (25) 25 (1,800) (1,617) 12,105 144,869 232 38 (2,317) 142,822 386 386 10,279 1,519 13,025 24,823 (1,821) 307 22,584 110,972 377
88,285
111,349 24,791 386
Total comprehensive income for the year
(32)
Share option expense
Share options lapsed
Dilution of minority interest
(172) 173 6 179
(172) (1,800) (1,617) 12,105 145,042 238 38 (2,317) 143,001
Dividend paid (Note 31)
Redemption of convertible bond
Issue of shares, net of expenses
12,105
Balance at 31 July 2009
100,390
Total comprehensive income for the year
Share option expense
Dividend paid (Note 31)
Consolidated Statement of Changes in Equity
Balance at 31 July 2010
100,390
Consolidated Statement of Cash Flows

2010 Note Cash flows from Operating Activities Profit before taxation Adjustments for: Depreciation of plant and equipment Share option expense Gain on disposal of equity interests in associate Gain on divestment/disposal of available-for-sale financial assets Plant and equipment written off Loss on disposal of plant and equipment net Interest income Interest expense Share of results of associate Operating profit before working capital changes Increase in inventories Increase in trade and other receivables Increase/(decrease) in trade and other payables Cash used in operations Income tax paid Cash flows used in operating activities Cash flows from Investing Activities Interest received Purchase of plant and equipment (Note A) Proceeds from disposal of plant and equipment Proceeds from disposal of long-term investments Cash flows generated from / (used in) investing activities Cash Flows from Financing Activities Interest paid Repayment of finance lease instalments Proceeds from borrowings Repayment of borrowings Repayment of convertible bonds Proceeds from issue of shares, net of expenses (Note 13) Deposits pledged Dividend paid to equity holders of the Company Cash flows used in financing activities Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of year Effect of exchange rate changes on cash balances held in foreign currencies Cash and cash equivalents at end of year Notes: A. Plant and equipment Plant and equipment amounting to $0.27 million (2009 - $0.04 million) was acquired through finance lease arrangements. 12 (158) 1,679 337 2,119 (787) (728) 5,000 (3,266) (2,317) (2,098) (282) 2,119 (974) (49) 1,848 (838) (12,545) 12,105 (3,000) (1,800) (5,253) (8,630) 10,412 56 (1,701) 189 9,010 7,554 77 (2,647) 64 821 (1,685) 4 21(c) 21(d) 21(d) 21(e) 21(d), 21(e) 22(a) 22(b) 3,185 38 (4,330) 16 1 (56) 705 8,475 (310) (13,323) 207 (4,951) (787) (5,738) 3,173 386 (5,065) (270) 38 (77) 974 (716) 8,734 (87) (8,373) (1,952) (1,678) (14) (1,692) 8,916 10,291 $000 2009 $000

F 15
Notes to the Financial Statement

The financial statements were authorised for issue by the directors on 21 October 2010. 1 CORPORATE INFORMATION Xpress Holdings Ltd is incorporated in the Republic of Singapore with its principal place of business and registered office at No. 1 Kallang Way 2A, Communications Techno Centre, Singapore 347495. The Company is listed on the Singapore Exchange Securities Trading Limited. The principal activities of the Company are those relating to investment holding. The principal activities of significant subsidiaries are set out in Note 5 to the accompanying financial statements. 2 2.1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of preparation The financial statements have been prepared in accordance with Singapore Financial Reporting Standards (FRS) including related Interpretations promulgated by the Accounting Standards Council. The financial statements have been prepared on the historical basis except for certain financial assets and financial liabilities which are measured at fair value. 2.2 Significant accounting estimates and judgements The preparation of financial statements in conformity with FRS requires management to make judgement, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgement about carrying amounts of assets and liabilities that are not readily apparent from other sources. 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 period in which the estimate is revised and in any future periods affected. The critical accounting estimates and assumptions used and areas involving a high degree of judgement are described below: Allowance for doubtful receivables Allowance for doubtful receivables of the Group is based on an evaluation of the recoverability of trade and other receivables. A considerable amount of judgement is required in assessing the ultimate realisation of these receivables, including their current creditworthiness, past collection history of each customer and ongoing dealings with them. If the financial conditions of the counterparties with which the Group contracted were to deteriorate, resulting in an impairment of their ability to make payments, additional allowance may be required.
F 16

2 2.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) Significant accounting estimates and judgements (contd) Impairment of goodwill and other non-financial assets Goodwill is tested for impairment at least annually, more often if indicators of impairment are identified. Assets that are subject to depreciation and amortisation are reviewed to determine whether there is any such indication that the carrying value of these assets may not be recoverable and have suffered an impairment loss. If any such indication exists, the assets are tested for impairment. The recoverable amounts of the assets are estimated in order to determine the extent of the impairment loss, if any. The recoverable amount is the higher of an assets fair value less costs to sell and value in use. Such impairment loss is recognised in the income statement. Management judgement is required in the area of asset impairment, particularly in assessing: (1) whether an event has occurred that may indicate that the related asset values may not be recoverable; (2) whether the carrying value of an asset can be supported by the net present value of future cash flows which are estimated based upon the continued use of the asset in the business; (3) the appropriate key assumptions to be applied in preparing cash flow projections including whether these cash flow projections are discounted using an appropriate rate. Changing the assumptions selected by management to determine the level, if any, of impairment, including the discount rates or the growth rate assumptions in the cash flow projections could materially affect the net present value used in the impairment test and as a result affect the Groups results. Depreciation of plant and equipment Plant and equipment are depreciated on a straight-line basis over their estimated useful lives. Management estimates the useful lives of plant and equipment to be within the range as indicated in the accounting policy for plant and equipment and depreciation. Changes in the expected level of usage and technological developments could impact the economic useful lives and the residual values of these assets, leading to potential changes in future depreciation charges, impairment losses and/or write-offs. Impairment of investment in subsidiaries Determining whether investments in subsidiaries are impaired requires an estimation of the value-in-use of these investments. The value-in-use calculation requires the Group to estimate the future cash flows expected from the cash-generating units and an appropriate discount rate in order to calculate the present value of the future cash flows. Management has evaluated the recoverability of the investments based on such estimates. Fair value of available-for-sale financial assets The fair value of available-for-sale financial assets that are not traded in an active market (Level 3 fair value measurement) is determined by using valuation techniques. These include the use of recent arms length transactions, reference to other instruments that are substantially the same and discounted cash flow analysis. The Group also estimates the fair values of the financial assets by reference to the net assets of these equity securities, adjusting where applicable using appropriate measures to fair value the underlying assets and liabilities. In determining these fair values, management evaluates, among other factors, the reliability and appropriateness of the use of the underlying net asset information provided, taking into consideration factors such as industry and sector outlook, other market comparables and other prevailing market conditions.
F 17

2 2.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) Significant accounting estimates and judgements (contd) Share-based payments Equity-settled share-based payments are measured at fair value at the date of grant. Judgement is required in determining the most appropriate valuation model for the share options granted, depending on the terms and conditions of the grant. Management are also required to use judgement in determining the most appropriate inputs to the valuation model including expected life of the option, volatility and dividend yield. The assumptions and model used are disclosed in Note 19 to the financial statements. Income tax Significant judgement is involved in determining the provision for income taxes. The Group recognises liabilities for expected tax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recognised, such differences will impact the income tax provision in the period in which such determination is made.
2.3
New accounting standards and interpretations On 1 August 2009, the Group adopted the following new or amended FRS and Interpretation to FRS (INT FRS) that are mandatory for application from that date. This includes the following new and revised standards, which are relevant to the Group:
New accounting standards and interpretations effective during current financial year
FRS 1 (Revised 2008) Amendments to FRS 1 and FRS 32 FRS 23 (Revised) Amendments to FRS 27 Amendments to FRS 39 Amendments to FRS 101 Amendments to FRS 102 Amendments to FRS 107 Amendments to FRS 107 FRS 108 Amendments to INT FRS 109 and FRS 39 INT FRS 113 INT FRS 116 Improvements to FRSs 2008 The adoption of these new/revised FRS and INT FRS did not result in substantial changes to the Groups accounting policies nor any significant impact on these financial statements except for the following: Presentation of Financial Statements - Revised presentation Amendments Relating to Puttable Financial Instruments and Obligations Arising on Liquidation Borrowing Costs Amendments Relating to Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate Amendments Relating to Reclassification of Financial Assets Amendments Relating to Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate Amendments Relating to Vesting Conditions and Cancellation Amendments Relating to Reclassification of Financial Assets Financial Instruments: Disclosures - Improving Disclosures about Financial Instruments Operating Segments Embedded Derivatives Customer Loyalty Programmes Hedges of a Net Investment in a Foreign Operation
F 18

2 2.3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) New accounting standards and interpretations (contd)
New accounting standards and interpretations effective during current financial year (contd)
FRS 1 (Revised 2008) Presentation of Financial Statements (effective from 1 January 2009) The revised standard requires an entity to present, in a statement of changes in equity, all owner changes in equity. All non-owner changes in equity (i.e. comprehensive income) are required to be presented in one statement of comprehensive income or in two statements (a separate income statement and a statement of comprehensive income). The Group has elected to present the statement of comprehensive income in two statements. Amendment to FRS 107 Improving disclosures about financial instruments (effective from 1 January 2009) The amendment requires enhanced disclosures about fair value measurement and liquidity risk. In particular, the amendment requires disclosure of fair value measurements by level of a fair value measurement hierarchy. The adoption of the amendment results in additional disclosures but does not have an impact on the accounting policies and measurement bases adopted by the Group. FRS 108 Operating Segments (effective from 1 January 2009) FRS 108, which replaces FRS 14 Segment Reporting, requires identification and reporting of operating segments based on internal reports that are regularly reviewed by the entitys chief operating decision maker in order to allocate resources to the segment and to assess its performance. The Group determined that the reportable operating segments are the same as the business segments previously identified under FRS 14 Segment Reporting.
New accounting standards and interpretations not yet adopted

At the date of authorisation of these financial statements, the following FRS and INT FRS were issued but not yet effective: FRS 24 (revised) FRS 27 (amended 2009) FRS 103 (revised 2009) Amendments to FRS 39 Amendments to INT FRS 109 Amendments to FRS 39 INT FRS 115 INT FRS 117 INT FRS 118 INT FRS 119 Improvements to FRSs 2009 The directors do not anticipate that the adoption of other FRSs and INT FRSs in future periods will have a material impact on the financial statements of the Group. Related party disclosures Consolidated and separate financial statements Business combinations Financial instruments: Recognition and measurement Eligible hedged items Reassessment of embedded derivatives Financial instruments: Recognition and measurement Embedded derivatives Agreements for the Construction of Real Estate Distributions of non-cash assets to owners Transfer of assets from customers Extinguishing financial liabilities with equity instruments
F 19

2 2.4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) Consolidation Business combinations The consolidated financial statements relate to the Company and its subsidiaries (together referred to as the Group). The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. Acquisitions of subsidiaries are accounted for using the purchase method. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. Any excess of the cost of the business combination over the Groups interest in the net fair value of the identifiable assets, liabilities and contingent liabilities represents goodwill. The goodwill is accounted for in accordance with the accounting policy for goodwill as described in Note 2.5. Any excess of the Groups interest in the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of business combination is recognised in the income statement on the date of acquisition. Minority interests represent the portion of profit or loss and net assets in subsidiaries not held by the Group. They are presented in the consolidated statement of financial position within equity, separately from the parent shareholders equity, and are separately disclosed in the consolidated income statement. Accounting for subsidiaries Investments in subsidiaries are stated in the Companys statement of financial position at cost less accumulated impairment losses. The accounting policies for subsidiaries are adjusted to be consistent with the policies adopted by the Group, only where it is material. Subsidiaries Subsidiaries are entities controlled by the Group. Control exists when the Group has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that presently are exercisable or convertible are taken into account. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. Transactions eliminated on consolidation All inter-company balances and significant inter-company transactions and resulting unrealised profits or losses are eliminated on consolidation and the consolidated financial statements reflect external transactions and balances only.
2.5
Goodwill Goodwill is initially recognised at cost and is subsequently measured at cost and tested for impairment as described in Note 2.24. On disposal of a subsidiary, the amount of goodwill attributable to the disposed subsidiary is included in the determination of the profit or loss on disposal.
F 20

2 2.6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) Functional currency The individual financial statements of each Group entity are measured and presented in the currency of the primary economic environment in which the entity operates (its functional currency). The consolidated financial statements of the Group and the statement of financial position of the Company are presented in Singapore dollars, which is the functional currency of the Company and the presentation currency for the consolidated financial statements. All financial information presented in Singapore dollars has been rounded to the nearest thousand, unless otherwise stated.
2.7
Foreign currency transactions and translation Transactions in foreign currencies are translated to the respective functional currencies of the Group entities at the exchange rate at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated to the functional currency at the exchange rate at the date on which the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Foreign currency differences arising on translation are recognised in the income statement except for (i) differences arising on the translation of monetary items that in substance form part of the Groups net investment in a foreign operation (see below) and (ii) available-for-sale equity instruments (see Note 2.10) that are recognised in other comprehensive income. Foreign subsidiaries The assets and liabilities of foreign operations are translated to Singapore dollars at exchange rates prevailing at the reporting date. The income and expenses of foreign operations are translated to Singapore dollars at average exchange rates. None of the foreign operations currencies is the currency of a hyper-inflationary economy. All resultant currency translation differences are recognised in currency translation reserve in equity. Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the closing rate. Foreign exchange differences are recognised in the currency translation reserve. When a foreign operation is disposed of, in part or in full, the relevant amount in the currency translation reserve is transferred to the income statement. Net investment in a foreign operation Exchange differences arising from monetary items that in substance form part of the Companys net investment in a foreign operation are recognised in the Companys income statement. Such exchange differences are reclassified to other comprehensive income and are accumulated in a separate component of equity in the consolidated financial statements. When the net investment is disposed of, the cumulative amount in equity is transferred to the consolidated income statement as an adjustment to the profit or loss arising on disposal.
2.8
Plant and equipment Plant and equipment are stated at cost less accumulated depreciation and impairment losses, if any. The cost of plant and equipment includes expenditure that is directly attributable to the acquisition of the items. Dismantlement, removal or restoration costs are included as part of the cost of plant and equipment if the obligation for dismantlement, removal or restoration is incurred as a consequence of acquiring or using the asset.
F 21

2 2.8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) Plant and equipment (contd) Subsequent expenditure relating to plant and equipment that has already been recognised is added to the carrying amount of the asset when it is probable that future economic benefits, in excess of the originally assessed standard of performance of the existing asset, will flow to the Group and the cost can be measured reliably. All other subsequent expenditure is recognised as an expense in the period in which it is incurred. Depreciation is charged so as to write off the cost of the assets over their estimated useful lives, using the straight-line method, as follows: Machinery Motor vehicles Office equipment Fixtures and fittings 10 years 6 years 3 to 10 years 3 to 10 years
Depreciation methods, useful lives and residual values are reviewed, and adjusted as appropriate, at each reporting date. Fully depreciated assets are retained in the financial statements until they are no longer in use. Disposal The gain or loss arising on disposal or retirement of an item of plant and equipment is determined as the difference between the sales proceeds and the carrying amounts of the asset and is recognised in the income statement. 2.9 Financial assets Financial assets can be divided into the following categories: financial assets at fair value through profit or loss, held-to-maturity investments, loans and receivables and available-for-sale financial assets. Financial assets are assigned to the different categories by management on initial recognition, depending on the purpose for which the investments were acquired. The designation of financial assets is re-evaluated and classification may be changed at the reporting date with the exception that the designation of financial assets at fair value through profit or loss is not reversible. All financial assets are recognised on their trade date - the date on which the Group commits to purchase or sell the asset. Financial assets are initially recognised at fair value, plus directly attributable transaction costs except for financial assets at fair value through profit or loss, which are recognised at fair value. Derecognition of financial instruments occurs when the rights to receive cash flows from the investments expire or are transferred and substantially all of the risks and rewards of ownership have been transferred. An assessment for impairment is undertaken at least at each reporting date whether or not there is objective evidence that a financial asset or a group of financial assets is impaired. Non-compounding interest and other cash flows resulting from holding financial assets are recognised in profit or loss when received, regardless of how the related carrying amount of financial assets is measured. The Group does not hold any financial assets at fair value through profit or loss or held-to-maturity investments. Cash and cash equivalents comprise cash balances and bank deposits. Bank overdrafts that are repayable on demand and which form an integral part of the Groups cash management are included as a component of cash and cash equivalents for the purpose of the cash flow statement.
F 22

2 2.10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) Available-for-sale financial assets The Groups investments in equity securities are classified as available-for-sale financial assets. Subsequent to initial recognition, they are measured at fair value and changes therein, other than for impairment losses and foreign exchange gains, are recognised directly in other comprehensive income and accumulated in fair value reserve. When an investment is derecognised, the cumulative gain or loss in equity is transferred to the income statement.
2.11
Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise when the Company provides money, goods or services directly to a debtor with no intention of trading the receivables. They are included in current assets, except for maturities greater than 12 months after the reporting date which are classified as non-current assets. Loans and receivables are subsequently measured at amortised cost using the effective interest method, less impairment losses, if any. Any change in their value is recognised in the income statement. Any reversal shall not result in a carrying amount that exceeds what the amortised cost would have been had any impairment loss not been recognised at the date the impairment is reversed. Any reversal is recognised in the income statement. Receivables are provided against when there is objective evidence that the Group will not be able to collect all amounts due to it in accordance with the original terms of the receivables. The amount of the write-down is determined as the difference between the assets carrying amount and the present value of estimated future cash flows. Loans and receivables are included in trade and other receivables in the statement of financial position.
2.12
Intra-group financial guarantees Financial guarantees are classified as financial liabilities. Financial guarantees are recognised initially at fair value. Subsequent to initial measurement, the financial guarantees are stated at the higher of the initial fair value less cumulative amortisation and the amount that would be recognised if they were accounted for as contingent liabilities. When financial guarantees are terminated before their original expiry date, the carrying amount of the financial guarantees is transferred to the income statement.
2.13
Share capital Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and share options are recognised as a deduction from equity.
2.14
Inventories Inventories are carried at the lower of cost and net realisable value. Cost is determined on a first-in first-out basis and includes freight and handling charges. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and selling expenses.
F 23

2 2.15
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) Provisions A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects the current market assessments of the time value of money and the risks specific to the liability. A provision for onerous contracts is recognised when the expected benefits to be derived by the Group from a contract are lower than the unavoidable cost of meeting its obligations under the contract. The provision is measured at the present value of the lower of the expected cost of terminating the contract and the expected net cost of continuing with the contract.
2.16
Leases Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. The Group as lessee Assets held under finance leases are recognised as assets of the Group at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability. Finance charges are charged directly to the income statement. Rentals payable under operating leases are charged to the income statement on a straight-line basis over the term of the relevant lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are charged to the income statement in the period in which they are incurred. In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. The Group as lessor Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease unless another systematic basis is more representative of the time pattern in which use benefit derived from the leased asset is diminished. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.
2.17
Interest income and finance costs Interest income from fixed deposits is recognised as it accrues, using the effective interest method. Finance costs, comprising interest expense on bank loans, bank overdrafts and finance lease liabilities, are recognised in the income statement using the effective interest method.
F 24

2 2.18
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) Employee benefits Short-term employee benefits Short-term benefit obligations, including accumulated compensated absences, are measured on an undiscounted basis and are expensed as the related service is provided. A provision is recognised for the amount expected to be paid under short-term cash bonuses if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably. Defined contribution plans Contributions to post-employment benefits under defined contribution plans are recognised as an expense in the income statement as incurred.
2.19
Share-based payments The Group issues equity-settled share-based payments to directors and certain employees. Equity-settled share-based payments are measured at fair value (excluding the effect of non market-based vesting conditions) at the date of grant. The fair value determined at the grant date of the equity-settled sharebased payments is expensed on a straight-line basis over the vesting period, based on the Groups estimate of shares that will eventually vest and adjusted for the effect of non market-based vesting conditions. The proceeds received net of any directly attributable transaction costs are credited to share capital when the options are exercised.
2.20
Key management personnel Key management personnel of the Company are those persons having the authority and responsibility for the planning, directing and controlling the activities of the Company. Key management personnel include Chief Operating Officer, General Manager, Group Financial Controller and certain managers.
2.21
Financial liabilities The Groups financial liabilities include trade and other payables, bank loans and finance lease liabilities. Financial liabilities are recognised when the Company and the Group become a party to the contractual agreements of the instrument. All interest-related charges are recognised as an expense in finance cost in the income statement. Financial liabilities are derecognised if the Groups obligations specified in the contract expire or are discharged or cancelled. Borrowings are recognised initially at the fair value of proceeds received less directly attributable transaction costs, if any. Borrowings are subsequently stated at amortised cost which is the initial fair value less any principal repayments. Any difference between the proceeds (net of transaction costs) and the redemption value is taken to the income statement over the period of the borrowings using the effective interest method. The interest expense is chargeable on the amortised cost over the period of borrowing using the effective interest method. Gains and losses are recognised in the income statement when the liabilities are derecognised as well as through the amortisation process. Borrowings which are due to be settled within 12 months after the reporting date are included in current borrowings in the statement of financial position even though the original terms were for a period longer than 12 months and an agreement to refinance, or to reschedule payments, on a long-term basis is completed after the reporting date. Borrowings to be settled within the Groups normal operating cycle are considered as current. Other borrowings due to be settled more than 12 months after the reporting date are included in non-current borrowings in the statement of financial position.
F 25

2 2.21
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) Financial liabilities (contd) Trade payables are initially measured at fair value, and subsequently measured at amortised cost, using the effective interest method.
2.22
Income taxes Income tax expense comprises current and deferred tax. Income tax expense is recognised in the income statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. Deferred tax is recognised using the balance sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of goodwill, the initial recognition of an asset or liability in a transaction that is not a business combination and that affects neither accounting nor taxable profit, and differences relating to investments in subsidiaries and jointlycontrolled entities to the extent that it is probable that they will not reverse in the foreseeable future. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted at the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets and they relate to income taxes levied by the same tax authorities on the same taxable entity, or on different tax entities, provided they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.
2.23
Dividends Final dividends proposed by the directors are not accounted for in shareholders equity as an appropriation of retained profit, until they have been approved by the shareholders in a general meeting. When these dividends have been approved by the shareholders and declared, they are recognised as a liability. Interim dividends are simultaneously proposed and declared, because of the articles of association of the Company grant the directors the authority to declare interim dividends. Consequently, interim dividends are recognised directly as a liability when they are proposed and declared.
2.24
Impairment of non-financial assets The carrying amounts of non-financial assets, other than inventories, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, the assets recoverable amounts are estimated. If it is not possible to estimate the recoverable amount of the individual asset, then the recoverable amount of the cash-generating unit to which the assets belong will be identified. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). As a result, some assets are tested individually for impairment and some are tested at cash-generating unit level.
F 26

2 2.24
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD) Impairment of non-financial assets (contd) Individual assets or cash-generating units that include goodwill and other intangible assets with an indefinite useful life or those not yet available for use are tested for impairment at least annually or more often if there are indicators of impairment. All other individual assets or cash-generating units are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the assets or cash-generating units carrying amount exceeds its recoverable amount. The recoverable amount is the higher of fair value, reflecting market conditions less costs to sell, and value in use, based on an internal discounted cash flow evaluation. Impairment losses recognised for cash-generating units, to which goodwill has been allocated, are credited initially to the carrying amount of goodwill. Any remaining impairment loss is charged pro rata to the other assets in the cash-generating unit. Any impairment loss is charged to the income statement unless it reverses a previous revaluation in which case it is charged to equity. With the exception of goodwill, An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount or when there is an indication that the impairment loss recognised for the asset no longer exists or decreases. An impairment loss is reversed only to the extent that the assets carrying amount does not exceed the carrying amount that would have been determined if no impairment loss had been recognised. A reversal of an impairment loss on a revalued asset is credited directly to equity under the heading revaluation surplus. However, to the extent that an impairment loss on the same revalued asset was previously recognised in the income statement, a decrease in that impairment loss is reversed through the income statement.
An impairment loss in respect of goodwill is not reversed, even if it relates to an impairment loss recognised in an interim period that would have been reduced or avoided had the impairment assessment been made at a subsequent reporting date. 2.25 Revenue recognition Revenue from the rendering of services is measured at the fair value of the consideration received or receivable, net of goods and services taxes or other sales taxes and trade discounts. Rental income is recognised on a straight-line basis over the lease term. Lease incentives, if any, are recognised as an integral part of total lease income. Dividend income is recognised when the right to receive the dividend is established. 2.26 Operating segments An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Groups other components. Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker has been identified as the Chief Executive Officer who makes strategic resources allocation decisions.
F 27

GOODWILL
Group 2010 $000 Goodwill at beginning and end of year 64,484 2009 $000 64,484
Impairment testing for cash-generating units containing goodwill The goodwill acquired in a business combination is allocated, at acquisition, to the cash-generating units (CGU) that are expected to benefit from that business combination. At the reporting date, the carrying amount of goodwill of approximately $64.5 million (2009: $64.5 million) is wholly attributable to the Precise Media Group Limiteds group of printing companies in the Peoples Republic of China and Hong Kong. The recoverable amount of the Precise Media cash-generating unit (CGU) for a 5-year period from 2011 to 2015 is determined on a value-in-use basis using financial budgets approved by the management. The cash flow projections represent the expected print media income less related costs and are based on past experience and expectations for these printing companies in general. Cash flows are projected using the anticipated revenue growth rate of 6% (2009: 8%) per annum. The growth rate used is based on historical growth and past experience and does not exceed the current estimated long-term average growth rate for the business in which the CGU operates. A pre-tax discount rate of 13.83% (2009: 15.1%) has been applied to the cash flow projections. The recoverable amount of the Precise Media CGU was determined to be higher than its carrying amount. The Group believes that any reasonably possible changes in the above key assumptions applied are not likely to materially cause the recoverable amount to be lower than its carrying amount.
F 28

PLANT AND EQUIPMENT

Motor vehicles $000 Office equipment $000 Furniture and fittings $000
Machinery $000 Group Cost At 1 August 2008 Exchange differences Additions Disposals At 31 July 2009 Exchange differences Additions Disposals Written off At 31 July 2010 Accumulated depreciation At 1 August 2008 Exchange differences Depreciation for the year Disposals At 31 July 2009 Exchange differences Depreciation for the year Disposals Written off At 31 July 2009 Carrying amount At 31 July 2010 At 31 July 2009 11,093 12,200 4,092 (68) 1,651 (479) 5,196 (55) 1,656 6,797 17,057 (6) 824 (479) 17,396 (408) 902 17,890
Total $000
2,027 32 78 (54) 2,083 (28) 61 (220) (15) 1,881
8,836 21 337 (204) 8,990 (44) 279 (35) (483) 8,707
5,552 11 1,449 (109) 6,903 (102) 727 (4) 7,524
33,472 58 2,688 (846) 35,372 (582) 1,969 (255) (502) 36,002
538 (1) 296 (53) 780 (4) 291 (38) (5) 1,024
6,771 (10) 827 (182) 7,406 (17) 594 (27) (480) 7,476
3,601 (15) 399 (73) 3,912 (6) 644 (1) 4,549
15,002 (94) 3,173 (787) 17,294 (82) 3,185 (65) (486) 19,846
857 1,303
1,231 1,584
2,975 2,991
16,156 18,078
F 29

PLANT AND EQUIPMENT (CONTD)

Motor vehicles The Company Cost At 1 August 2008, 31 July 2009 and 1 August 2009 Additions At 31 July 2010 Accumulated depreciation At 1 August 2008 Depreciation for the year At 31 July 2009 Depreciation for the year At 31 July 2010 Carrying amount At 31 July 2010 At 31 July 2009 272 395 12 10 284 405 212 123 335 123 458 10 8 18 9 27 222 131 353 132 485 730 730 28 11 39 758 11 769 $000 Office equipment $000
Total $000
(a) (b)
Plant and equipment with a carrying amount of $1.7 million (2009: 1.9 million) was pledged to secure revolving loans granted to a subsidiary (Note 15). Details of the carrying amounts of plant and equipment secured under finance lease agreements (Note 16) are as follows:
Group 2010 $000 2009 $000 491 2,442 2,933 Company 2010 $000 223 223 2009 $000 321 321
Motor vehicles Machinery
362 2,835 3,197
F 30

INVESTMENTS IN SUBSIDIARIES
2010 The Company Unquoted equity shares, at cost - Xpress Print (Pte) Ltd - Xpress Print (ShenZhen) Co., Ltd - Precise Media Group Limited - Xpress Print (Vietnam) Co., Ltd Less: Impairment losses 16,500 1,992 66,590 151 85,233 (6,651) 78,582 16,500 1,992 66,590 151 85,233 (6,651) 78,582 $000 2009 $000
Movement in impairment losses is as follows:

2010 $000 At 1 August Amount recognised At 31 July 6,651 6,651 2009 $000 6,500 151 6,651
Details of subsidiaries are as follows:

Country of incorporation/ business
Name of subsidiary
Groups effective equity interest 2010 % 2009 %
Principal activities
Held by Company Xpress Print (Pte) Ltd Singapore 100% 100% Providing general printing, multimedia and pre-press work Providing general printing, multimedia and pre-press work Investment holding General printers
Xpress Print (ShenZhen) Co., Ltd
PRC
100%
100%
Precise Media Group Limited Xpress Print (Vietnam) Co., Ltd (1)
British Virgin Islands Vietnam
100% 100%
100% 100%
F 31

INVESTMENTS IN SUBSIDIARIES (CONTD)

Country of incorporation/ business
Name of subsidiary
Groups effective equity interest 2010 % 2009 %
Held by subsidiaries Xpress Print (K.L.) Sdn Bhd Xpress Media Pte Ltd Xpress Print (Australia) Pty Ltd (2) Xpress Print (H.K.) Limited (3) Print Planner (Hong Kong) Limited Malaysia Singapore Australia Hong Kong Hong Kong 100% 100% 76% 100% 100% 100% 100% 76% 100% 100% General printers General printers Pre-press work General trading Provision of one-stop print-related services and printer consultancy services Provision of pre-press production related technical support service Provision of print-related services and printer consultancy services Provision of print-related services and printer consultancy services # Pre-press work Provision of pre-press production related technical support service Provision of pre-press production related technical support service
Print Planner (Shanghai) Limited
PRC
100%
100%
Print Planner (Shenzhen) Limited
PRC
100%
100%
Print Planner (Intl) Limited
Hong Kong
100%
Xpress Media Philippines Inc. (4) Print Planner (Chengdu) Limited
Philippines PRC
80% 100%
80% 100%
Print Planner (Beijing) Limited
PRC
100%
100%
Held by subsidiaries Shenzhen Xpress Print Technology Co., Ltd Print Planner (Shenyang) Co., Ltd PRC 100% 100% Provision of pre-press production related technical support service Provision of pre-press production related technical support service
PRC
100%
100%
During the financial year, Print Planner (Intl) Limited (PPIL) was incorporated in Hong Kong as a wholly owned subsidiary of Print Planner (Shenzhen) Limited with an initial paid-up capital of HKD 10,000. PPIL has yet to commence operations to provide print-related services and printer consultancy services.
F 32

INVESTMENTS IN SUBSIDIARIES (CONTD)
Notes on Auditor:
All subsidiaries are audited by Foo Kon Tan Grant Thornton LLP Singapore or member firms of Grant Thornton , International except for the following:
(1) (2) (3) (4)
Audited by BDO Auditing and Accounting Financial Consulting Company, Ho Chi Minh City Audited by HC and Associates, Australia Audited by Kingston C.P Limited, Hong Kong .A. Audited by Fernandez, Santos & Lopez, Philippines
In conformity with the requirements of Rule 716 of the Listing Manual of The SGX-ST, the Audit Committee and the Board of Directors of the Company confirm that they are satisfied that the appointment of different auditors for certain of its overseas subsidiaries would not compromise the standard and effectiveness of the audit of the Group. Impairment loss During the last financial year, having regard to the financial performance of a subsidiary, an impairment loss of $0.15 million, determined based on estimated recoverable amount of the subsidiary, was recognised by the Company in respect of the Companys investment in this subsidiary. The recoverable amount of the investment in the subsidiary was determined based on the value in use of the subsidiary, and determined using a pre-tax discount rate of 15.1%. The valuein-use calculation was based on projected cash flows derived from the financial budgets approved by the management covering a five-year period. Cash flows were projected using the estimated growth rate of 8% per annum which was consistent with the forecasts included in industry reports. The discount rate was derived from the Companys average cost of capital and reflected market assessments of specific risks relating to the business of the subsidiary at the reporting date. 6 INVESTMENT IN ASSOCIATE
Group 2010 $000 Unquoted shares, at cost Groups share of post -acquisition profits Exchange differences Disposal # Transfer to available-for-sale financial assets (Note 8)* Carrying value at the end of the year 2009 $000 6,122 3,486 (92) 9,516 (3,212) (6,304) Company 2010 $000 2009 $000 6,122 6,122 (2,061) (4,061)
F 33

INVESTMENT IN ASSOCIATE (CONTD) Details of the Groups associate were as follows:

Country of incorporation/ business Groups effective equity interest 2010 % Shenzhen Jiaxinda Printing Co., Ltd (Jiaxinda) PRC 2009 % Provision of print-related services
Name of associate
Summarised financial information in respect of the Groups associate was set out below:
2010 $000 Revenue Expenses Profit before tax Income tax expense Profit after tax 2009 $000 28,475 (25,982) 2,493 (106) 2,387
The Groups investment in associate was stated at cost as adjusted for post-acquisition changes in the Groups share of net assets of the associate based on its unaudited management accounts, less any impairment in the value of the individual investment. During the last financial year, the Groups share of post-acquisition profits of the associate until the date of disposal, after deducting the related share of associates tax of $32,000 was $716,100.
#
During the last financial year, the Group disposed of 10.1% equity interest in Jiaxinda with a carrying amount of approximately $3.2 million for a consideration of approximately $8.4 million.The gain on the divestment, net of expenses, was approximately $5 million. Consequently, the Groups stake in Jiaxinda was reduced from 30.0% to 19.9%. The Group ceased applying the equity method of accounting for the investment in Jiaxinda because it was no longer able to exert significant influence over the investee. The Group adopts the fair value method as the new basis of accounting for the investment in Jiaxinda. The remaining carrying amount of the investment in Jiaxinda of $6.3 million at the date that it ceased to be an associate was regarded as the cost of the available-for-sale financial assets (Note 8).
F 34

AMOUNTS DUE FROM / TO SUBSIDIARIES

Company 2010 $000 Non-current Amounts due from subsidiaries non-trade Current Amounts due from subsidiaries - trade - non-trade Less: Impairment losses Amounts due to subsidiaries - trade - non-trade 71 10,026 10,097 7,950 7,950 8,349 1,347 (331) 9,365 15,673 779 (331) 16,121 21,380 4,304 2009 $000
The non-current non-trade amounts due from subsidiaries are unsecured and have no fixed terms of repayment. These amounts bear interest at 6% (2009: 6%) per annum based on 1% above the prevailing market interest rate. The current non-trade amounts due from/to subsidiaries comprise mainly advances. The current trade/non-trade amounts due from/to subsidiaries are unsecured, interest-free and repayable on demand. 8 AVAILABLE-FOR-SALE FINANCIAL ASSETS
Group 2010 $000 Unquoted equity shares, at fair value Balance at 1 August Additions Transfer from investment in associate (Note 6) Change in fair value Translation difference Disposals # Balance at 31 July 16,598 (1,222) (7,719) 7,657 334 15 6,304 10,279 (334) 16,598 16,583 (1,222) (7,719) 7,642 4,061 12,522 16,583 2009 $000 Company 2010 $000 2009 $000
F 35

AVAILABLE-FOR-SALE FINANCIAL ASSETS (CONTD)

#
During the financial year, the Group divested of 10% equity interest in Shenzhen Jiaxinda Printing Co., Ltd (Jiaxinda) with a carrying amount of approximately $7.7 million for a consideration of approximately $7.7 million. Consequently, the Groups stake in Jiaxinda was reduced from 19.9% to 9.9%. The Group recorded a gain on disposal of the divestment amounting to approximately $4.3 million after taking into account expenses incurred of $232,000 and the transfer of the accumulated fair value gain on the 10% equity interest divested of $4.5 million from fair value reserve to the income statement.
At 31 July 2010, $1.2 million of the sales proceeds had been received. Payment of the remaining balance of $6.5 million (Note 10) is due in October 2010 in accordance with the contractual arrangements with the purchasers of the investment. 9 INVENTORIES
Group 2010 $000 Raw materials and consumables Cost of inventories recognised as expense included in Raw materials and consumables used in the consolidated income statement 889 2009 $000 592
29,990
24,652
10
TRADE AND OTHER RECEIVABLES

Group 2010 $000 Trade receivables Less: Impairment losses on trade receivables Project receivables Other receivables Sundry receivables Advances to staff Receivable from sale of investment Deposits Advance payment to paper suppliers Prepayments 1,173 77 6,496 1,833 6,393 4,605 20,577 64,720 3,593 890 7,787 2,602 8,314 4,195 27,381 55,292 247 26 6,496 26 22 6,817 6,817 252 7,787 132 28 8,199 8,199
#
Company 2009 $000 2010 $000 2009 $000
35,337 (253) 35,084 9,059 44,143
28,372 (461) 27,911 27,911
Project receivables arose from revenue related to a print project with a publisher.
F 36

10
TRADE AND OTHER RECEIVABLES (CONTD) Trade receivables generally have payment terms of 120 days. The Groups and Companys trade receivables that are not denominated in the functional currencies of the respective entities are as follows:
Group 2010 $000 United States dollars New Taiwan dollars Australian dollars Hong Kong dollars Chinese Renminbi Others 67 103 303 1,749 2 2009 $000 10 7 80 34 177 6 Company 2010 $000 2009 $000
The following is an analysis of the movement in impairment loss in respect of trade receivables:
Group 2010 $000 Impairment loss At beginning of the year Amounts written off Amounts recovered Amount recognised # Exchange difference 461 (78) (162) 32 253 565 (43) (141) 84 (4) 461 2009 $000 Company 2010 $000 2009 $000
During the financial year, having regard to uncertainties surrounding the collectibility of certain trade receivables, the Group recorded impairment losses amounting to $32,000 (2009: $84,000).
F 37

10
TRADE AND OTHER RECEIVABLES (CONTD) The table below is an analysis of trade receivables at 31 July:
Group 2010 $000 Not past due and not impaired Past due but not impaired (a) Past due and impaired Less: Impairment losses Trade receivables, net Notes: (a) Aging of receivables that are past due but not impaired Less than 3 months More than 3 months but less than 6 months More than 6 months but less than 12 months More than 12 months 1,946 5,890 12,640 524 21,000 2,470 84 251 2,805 23,143 21,000 253 44,396 (253) 44,143 2009 $000 25,106 2,805 461 28,372 (461) 27,911 Company 2010 $000 2009 $000
11
AMOUNT DUE FROM RELATED PARTY

Group 2010 $000 Amount due from related party (non-trade) 2009 $000 Company 2010 $000 2009 $000 2
At 31 July 2009, the non-trade amount due from a related party, comprising advances, was unsecured, interest-free and repayable on demand. At the reporting date, the Group held 9.9% (2009: 19.9%) equity interest in this related party (Note 8). 12 CASH AND CASH EQUIVALENTS
Group 2010 $000 Cash on hand and at bank Fixed deposits 5,352 5,420 10,772 2009 $000 5,355 5,420 10,775 Company 2010 $000 155 5,000 5,155 2009 $000 429 5,000 5,429
F 38

12
CASH AND CASH EQUIVALENTS (CONTD)

Group 2010 $000 Cash and cash equivalents in the consolidated statement of financial position Bank overdraft (Note 15(4)) Fixed deposits pledged as security for the Groups banking facilities (Notes 15 Fixed deposits pledged as security for a related partys banking facilities Cash and cash equivalents in the consolidated statement of cash flows
(2)
2009 $000 10,775 (3,236) (3,420) (2,000) 2,119
10,772 (3,673) and 15 )

(4)
(3,420) (2,000) 1,679
The weighted effective interest rate on fixed deposits, with an average maturity of 6 months, is 0.79% (2009 0.5%) per annum. Cash and cash equivalents that are not denominated in the functional currencies of the respective entities are as follows:
Group 2010 $000 Japanese Yen 1 1 2009 $000 1 1 Company 2010 $000 2009 $000
13
SHARE CAPITAL
Group and Company No. of shares 2010 000 Issued and fully paid, with no par value At 1 August Issue of new shares # Share issue expenses At 31 July 1,544,520 1,544,520 1,384,520 160,000 1,544,520 100,390 100,390 88,285 12,816 (711) 100,390 2009 000 2010 $000 2009 $000
All issued shares are fully paid and have no par value. The Company has one class of ordinary shares which carries no right to fixed income. The holders of ordinary shares are entitled to receive dividends as and when declared by the Company. All ordinary shares carry one vote per share without restriction.
#
During the last financial year, the Company issued 160,000,000 new ordinary shares by way of a private share placement at an issue price of $0.0801 per share. Net proceeds of $12.1 million received from the share placement were utilised as follows: (i) $10.0 million used for repaying outstanding convertible bonds; and (ii) $2.1 million used for repaying short-term bank borrowings.
F 39

14
RESERVES
Group 2010 $000 Fair value reserve Currency translation reserve Share option reserve Retained profits 5,717 (3,978) 706 39,987 42,432 2009 $000 10,279 (302) 668 33,834 44,479 Company 2010 $000 5,622 706 10,392 16,720 2009 $000 12,522 668 6,396 19,586
Movements in reserve for the Group and the Company are set out in the Statements of Changes in Equity. (a) Fair value reserve The fair value reserve relates to the cumulative net changes in the fair values of available-for-sale financial assets until the investments are derecognised or impaired. (b) Currency translation reserve The currency translation reserve comprises foreign exchange differences arising from the translation of the financial statements of foreign operations whose functional currencies are different from the functional currency of the Company, as well as foreign exchange differences arising from the translation of monetary items that in substance form part of the Companys net investment in foreign operations. (c) Share option reserve The share option reserve comprises the cumulative value of employee services received for the issue of share options. 15 INTEREST-BEARING BORROWINGS
Effective interest rate Year of maturity
Group Non-current Term loans (unsecured) (1) Term loans (secured) (2)
2010 $000
2009 $000 500 1,668 2,168
5.00% 5.13%
2013 2011
1,761 1,761
Current Term loans (unsecured) (1) Term loans (secured) (2) Revolving loans (secured) (3) Bank overdraft (secured) (4) Total 5.00% 5.94% 5.59% 5.00% 2011 2011 2011 2011 1,792 573 2,416 3,673 8,454 10,215 500 2,321 3,236 6,057 8,225
F 40

15
INTEREST-BEARING BORROWINGS (CONTD) The bank loans bear interest at fixed rates and the bank overdraft bears interest at the banks prime rate.
(1)
This relates to a $5 million bridging loan. $2 million of the loan principal is repayable over 24 months from June 2009 and $3 million of the loan principal is repayable over 48 months from October 2009. The bank loans are secured by fixed deposits of $0.42 million (2009: $0.42 million) (Note 12). The revolving loans are secured by plant and equipment with a carrying amount of $1.7 million (2009: $1.9 million) (Note 4(a)). The bank overdraft is secured by fixed deposits of $3 million (2009: $3 million) (Note 12).
(2)
(3)
(4)
The bank loans are denominated in the functional currencies of the respective entities. 16 FINANCE LEASE LIABILITIES
Group 2010 $000 Not later than one year Later than one year and not later than five years Later than five years Total minimum lease payments Less: Amounts representing future finance charges Present value of minimum lease payments Lease payments due: Not later than one year Presented as current liabilities Lease payments due: Later than one year and not later than five years Later than five years Presented as non-current liabilities 1,208 1,208 2,067 1,429 501 1,930 2,836 149 149 205 206 1 207 263 859 859 906 906 56 56 56 56 950 1,369 2,319 (252) 2,067 2009 $000 1,029 2,181 1 3,211 (375) 2,836 Company 2010 $000 69 177 246 (41) 205 2009 $000 69 245 1 315 (52) 263
The weighted average effective interest rates of the finance lease liabilities are as follows:
Group 2010 3.37% 2009 2.67% Company 2010 3.5% 2009 3.5%
All finance lease liabilities are on a fixed repayment basis and there are no arrangements for contingent rental payments.
F 41

16
FINANCE LEASE LIABILITIES (CONTD) Finance lease liabilities of the Group were secured by the leased assets (Note 4(b)). The finance lease liabilities are denominated in the functional currencies of the respective entities as follows:
Group 2010 $000 Singapore dollars Chinese Renminbi 1,481 586 2,067 2009 $000 2,736 100 2,836 Company 2010 $000 205 205 2009 $000 263 263
17
DEFERRED TAX ASSETS/LIABILITIES

Group Assets $000 At 1 August 2008 Recognised in income statement (Note 23) Exchange difference At 31 July 2009 Recognised in income statement (Note 23) Exchange difference At 31 July 2010 24 (24) Liabilities $000 (1,634) 1,634 (2) (2) (2) Company Assets $000 24 (24) Liabilities $000
Deferred tax assets and liabilities are offset when there is legally enforceable right to set-off current tax assets against current tax liabilities and when the deferred taxes relate to the same taxation authority. The amounts determined after appropriate offsetting are included in the statement of financial position as follows:
Group 2010 $000 Deferred tax liabilities Plant and equipment (2) (2) 2009 $000 Company 2010 $000 2009 $000
At the reporting date, the Group had unutilised tax losses of approximately $10.3 million (2009 - $10.4 million) which was available for carry forward and set-off against future taxable income, subject to agreement by the tax authorities and compliance with certain provisions of the tax legislations of the respective countries in which the subsidiaries operate. Deferred tax assets in respect of the tax losses have not been recognised due to the unpredictability of future profit streams.
F 42

18
TRADE AND OTHER PAYABLES

Group 2010 $000 Trade payables Other payables Accrued expenses Purchase of plant and equipment Accrued directors fees Others 2,466 339 237 469 3,511 9,379 2,297 381 225 371 3,274 9,359 1,253 237 7 1,497 1,811 871 225 1,096 1,286 5,868 2009 $000 6,085 Company 2010 $000 314 2009 $000 190
The Groups and Companys trade payables were denominated in the functional currencies of the respective entities. Further details of liquidity risks on trade and other payables are disclosed in Note 28(d). 19 EQUITY COMPENSATION Share option scheme The Xpress Holdings Executives Share Option Scheme (the SOS) was approved by its members at an Extraordinary General Meeting held on 25 June 2001. The SOS is administered by the Remuneration Committee which comprises the following directors: Dr Wang Kai Yuen (Chairman) Lai Hock Meng Sam Chong Keen Other information regarding the SOS is set out below: (a) Options granted to employees and executive directors shall be subject to an option period of 10 years commencing from the date of grant and expiring on the day immediately preceding the 10th anniversary of the date of grant. Options granted to non-executive directors of the Group shall be subject to an option period of 5 years commencing from the date of grant and expiring on the day immediately preceding the 5th anniversary of the date of grant. The options vest one year from the date of grant. All options are settled by physical delivery of shares.
(b)
(c) (d)
F 43

19
EQUITY COMPENSATION (CONTD) (e) Details of the share options are as follows:
Granted during the year Lapsed during the year (12,000) (50,000) (62,000) Exercised during the year
Date of grant 25.06.2001 25.06.2001 07.12.2001 07.12.2001 30.06.2003 11.12.2003 04.12.2006 01.03.2007 10.03.2008 22.09.2008 20.10.2008 24.06.2009
Balance at 01.08.2009 230,000 224,000 350,000 65,000 400,000 331,000 4,100,000 3,300,000 8,000,000 22,000,000 8,000,000 1,000,000 48,000,000
Balance at 31.07.2010 230,000 212,000 350,000 65,000 400,000 281,000 4,100,000 3,300,000 8,000,000 22,000,000 8,000,000 1,000,000 47,938,000
Exercise price $0.0754 $0.0723 $0.0500 $0.0550 $0.0550 $0.0733 $0.1783 $0.1650 $0.1200 $0.0700 $0.0500 $0.0850
Expiry date 24.06.2011 24.06.2011 06.12.2011 06.12.2011 29.06.2013 10.12.2013 03.12.2016 28.02.2017 09.03.2018 21.09.2013 19.10.2018 23.06.2019
No options were granted during the financial year (2009: 31,000,000). No options were exercised during the financial years ended 31 July 2009 and 2010. At 31 July 2010, 47,938,000 (2009: 17,000,000) options were exercisable. The weighted average remaining contractual life of share options outstanding at the end of the year is 5.3 (2009 6.3) years. Fair value of share options and assumptions The fair value of share options was determined using the Black-Scholes valuation model with the following inputs:
Grant date Fair value at measurement date Exercise price at grant date Expected volatility Risk -free interest rate Expected dividend yield Expected option life 22.09.2008 $0.0650 $0.0700 71.64% 3.625% 10% 3 years 20.10.2008 $0.0450 $0.0500 55.05% 3.625% 10% 3 years 24.06.2009 $0.0800 $0.0850 57.18% 3.625% 10% 3 years
The exercise price at the grant date is based on volume-weighted share price for 3 consecutive trading days prior to the grant date. The expected volatility is measured by the standard deviation of 36 months average intra-day high and low share prices prior to the grant date. The risk-free interest rates are based on the 10year zero-coupon Singapore Government bond yields on the grant date. Expected dividend yield is based on expected dividend payout over the 1 year volume-weighted average share price prior to the grant date.
F 44

20
REVENUE
Group 2010 $000 Print media services 59,545 2009 $000 54,999
Revenue represents invoiced sales for services rendered, net of goods and services taxes or other sales taxes and after allowance for trade discounts. Intra-group revenue was eliminated on consolidation and excluded from group revenue. 21 (a) PROFIT BEFORE TAXATION Other income
Group 2010 $000 Rental income Miscellaneous income 434 287 721 2009 $000 364 635 999
(b)
Staff costs
Group 2010 $000 Directors fees: directors of the Company - current year - prior year directors of a subsidiary directors of the Company directors of a subsidiary contributions to defined contribution plans salaries, wages and other related costs contributions to defined contribution plans salaries, wages and other related costs contributions to defined contribution plans 237 12 19 1,140 320 21 1,512 50 8,055 532 11,898 225 31 5 863 358 21 1,466 45 8,701 626 12,341 2009 $000
Directors remuneration other than fees
Key management personnel (other than directors):
Other than directors and key management personnel:
F 45

21 (c)
PROFIT BEFORE TAXATION (CONTD) Other operating expenses Other operating expenses mainly comprise the following:
Group 2010 $000 Marketing expenses Corporate and legal expenses Operating lease expense - offices, factories and warehouses Utilities Share option expense Repair and maintenance of equipment Upkeep of motor vehicles Telecommunication expense Others 3,125 1,563 2,295 760 38 311 376 221 878 9,567 2009 $000 2,654 2,403 2,369 750 386 260 311 233 1,120 10,486
(d)
Non-operating income
Group 2010 $000 Gain on disposal of plant and equipment net Gain on disposal of equity interests in associate Gain on divestment/disposal of available-for-sale financial assets Others 13 4,330 4,343 2009 $000 5,065 270 176 5,511
(e)
Profit before taxation In addition to those disclosed elsewhere in these financial statements, the following items have been included in arriving at profit before taxation:
Group 2010 $000 Depreciation of plant and equipment (Note 4) Plant and equipment written off Loss on disposal of plant and equipment Bad debts written off, trade Share option expense included in other operating expenses (Reversal of allowance)/allowance for doubtful trade receivables, net 3,185 16 14 38 38 (130) 2009 $000 3,173 38 386 (57)
F 46

21 (f)
PROFIT BEFORE TAXATION (CONTD) Compensation of directors The remuneration of directors of the Group during the year was as follows:
Group 2010 $000 Directors fees: (Note 21(b)) Directors of the Company - current year - prior year Directors of a subsidiary 237 12 19 1,481 20 1,769 225 31 5 1,242 280 1,783 2009 $000
Directors remuneration other than fees (Note 21(b)) Share option expense (Included as part of share option expense in Note 21(c))
The remuneration information of the directors of the Company as categorised into remuneration bands is as follows:
Company 2010 Number $500,000 above $250,000 to $499,999 Below $250,000 2 7 9 2009 Number 2 7 9
22
INTEREST INCOME AND FINANCE COST

Group 2010 $000 2009 $000
(a)
Interest Income
Interest income on fixed deposits 56 77
F 47

22
INTEREST INCOME AND FINANCE COST (CONTD)

Group 2010 2009 $000 9 618 96 251 974
(b)
Finance Costs
Interest expense - Bank overdraft - Bank loans - Finance lease liabilities - Convertible bonds
$000 145 471 89 705
23
TAXATION
Group 2010 $000 Current income tax - current year - Under / (over) - provision in prior years Deferred income tax - Over provision in prior years (Note 17) Total income tax expense / (credit) 446 (1,634) (2,715) 60 386 446 370 (1,451) (1,081) 2009 $000
Reconciliation of effective tax rate

Group 2010 $000 Profit before taxation Tax calculated using Singapore tax rate of 17% (2009: 17%) Non-allowable items Utilisation of previously unrecognised tax benefits Deferred tax benefit not recognised Effects of tax rates in different tax jurisdictions Income not subject to tax Under / (over) - provision in prior years Tax effect of share of results of associate 8,916 1,516 733 (210) 1,117 294 (3,390) 386 446 2009 $000 10,291 1,626 635 415 (68) (2,116) (3,085) (122) (2,715)
Singapore income tax was calculated at 17% (2009 - 17%) of the estimated assessable profit for the year. Taxation for other countries was calculated at rates prevailing in the relevant countries between 16.5% and 30%.
F 48

24
EARNINGS PER SHARE

2010 $000 Basic earnings per share is based on: Profit after taxation attributable to equity holders of the parent 8,470 13,025 2009 $000
Number of shares (000) Number of shares outstanding at the beginning of the year Weighted average number of new shares issued Weighted average number of shares in issue during the year 1,544,520 1,544,520 1,384,479 15,780 1,400,259
In calculating diluted earnings per share, the weighted average number of shares in issue during the year is adjusted to take into account the dilutive effect arising from the dilutive share options with the potential ordinary shares weighted for the year outstanding.
Number of shares (000) 2010 Weighted average number of shares used in calculation of basic earnings per share Adjustment for potential dilutive ordinary shares Weighted average number of shares used in calculation of diluted earnings per share 1,544,520 5,431 1,549,951 2010 Earnings per share (cents) - Basic - Diluted 0.55 0.55 0.93 0.93 2009 1,400,259 1,209 1,401,468 2009
25
CONTINGENT LIABILITIES AND GUARANTEES

Group 2010 $000 Guarantees provided to subsidiaries in respect of banking facilities Corporate guarantees given to a subsidiary in respect of credit facilities Fixed deposits pledged as security for a related partys banking facilities # 2009 $000 Company 2010 $000 2009 $000
1,232 2,000
1,632 2,000
11,361
8,320
The related party is Jiaxinda in which the Group holds a 9.9% (2008: 19.9%) equity interest (Note 8). Jiaxinda had yet to utilise the banking facilities as at 31 July 2009 and 2010.
F 49

26
COMMITMENTS Operating lease commitments
The Group as lessor

The Group sublets part of its leasehold building to third parties. The subleases contain initial non-cancellable periods of two to three years with options to renew at market rates thereafter. Non-cancellable operating lease rentals are receivable as follows:
Group 2010 $000 Lease rentals receivable: Not later than one year Later than one year and not later than five years 429 215 644 436 473 909 2009 $000
During the year ended 31 July 2010, rental income of $434,000 (2009: $364,000) was recognised as other income in the income statement (Note 21(a)).
The Group as lessee Non-cancellable operating lease rentals are payable as follows:
Group 2010 $000 Lease rentals payable: Not later than one year Later than one year and not later than five years Later than five years 2,031 6,177 8,208 1,601 5,142 640 7,383 2009 $000
The operating leases related to the Groups and the Companys offices, factories and warehouses expire between 2 and 5 years, with an option to renewal upon maturity. 27 OPERATING SEGMENTS For management reporting purposes, the Group is organised into the following reportable operating segments: (a) (b) Print Media - involved in the printing of time-sensitive Stock Market Research Reports, Fund Management Reports, Annual Reports, IPO Prospectus, Trade Directors and Corporate Brochures and Collaterals. Corporate - includes Corporate Office which incurs general corporate expense and derives revenue from management fees and interest income from subsidiaries.
F 50

27
OPERATING SEGMENTS (CONTD) Segment accounting policies are the same as the policies described in Note 2. The Group generally accounts for inter-segment sales and transfers on terms agreed between the parties. Segment revenue and expense: Segment revenue and expenses are the operating revenue and expenses reported in the Groups income statement that are directly attributable to a segment and the relevant portion of such revenue and expense that can be allocated on a reasonable basis to a segment. Segment revenue and expenses include transfers between business segments. Inter-segment sales are charged at cost plus a percentage profit mark-up. These transfers are eliminated on consolidation. Segment assets and liabilities: Segment assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Capital expenditure includes the total cost incurred to acquire plant and equipment directly attributable to the segment. Unallocated assets comprise cash and cash equivalents. Unallocated liabilities comprise interest-bearing borrowings, finance lease liabilities and income tax payable. The Group Chief Executive Officer (Groups CEO) monitors the operating results of its operating segments for the purpose of making decisions about resource allocation and performance assessment. Information regarding the results of each reportable segment is included below. Performance is measured based on segment profit before income tax, as included in the internal management reports that are reviewed by the Groups CEO. Segment profit is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries.
Corporate and Others 2010 $000 10,482 10,482 2,379 2009 $000 8,279 8,279 1,357
Print Media 2010 $000 Sales to external customers Inter-segment sales Segment revenue Segment results Finance costs Share of results of associate Gain on divestment/disposal of available-for-sale financial assets Gain on disposal of associate Profit before taxation Income tax (expense) / credit Profit for the year 59,545 4,630 64,175 2,912 2009 $000 54,999 3,971 58,970 3,857
Eliminations 2010 $000 (15,112) (15,112) 2009 $000 (12,250) (12,250)
Consolidated 2010 $000 59,545 59,545 5,291 (705) 2009 $000 54,999 54,999 5,214 (974) 716
4,330 8,916 (446) 8,470
270 5,065 10,291 2,715 13,006
F 51

27
OPERATING SEGMENTS (CONTD)

Corporate and Others 2010 $000 2009 $000
Print Media 2010 $000 Assets and liabilities: Segment assets Unallocated assets Total assets Segment liabilities Income tax payable Deferred tax liabilities Unallocated liabilities Total liabilities Other segment information: Capital expenditure Depreciation 1,968 3,053 2,688 3,042 7,553 7,868 139,163 129,857 2009 $000
Eliminations 2010 $000 2009 $000
Consolidated 2010 $000 2009 $000
14,743
25,187
153,906 10,772 164,678
155,044 10,775 165,819 9,004 355 2 11,416 20,777
1,809
1,136
9,365 14 2 12,296 21,677
132
131
1,969 3,185
2,688 3,173
Segment revenue is analysed based on the location of customers regardless of where the goods and services are produced. Total assets and capital expenditure are based on the geographical location of the assets. The following table presents revenue, total assets and capital expenditure information regarding the Group geographical segments as at and for the years ended 31 July 2009 and 2010.
Revenue 2010 $000 Singapore Malaysia Hong Kong Australia China Others Total 12,655 1,335 1,325 1,099 41,466 1,665 59,545 2009 $000 11,374 1,256 1,586 810 38,150 1,823 54,999 Total assets 2010 $000 28,700 883 211 238 134,296 350 164,678 2009 $000 39,790 888 568 293 124,036 244 165,819 Capital expenditure 2010 $000 449 5 1,515 1,969 2009 $000 320 79 2,289 2,688
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28 (a)
FINANCIAL RISK MANAGEMENT Financial risk management objectives and policies The Group and the Company are exposed to credit risk, market risk (including foreign currency and interest rate risks) and liquidity risk in the normal course of the Groups business. The Board of Directors has overall responsibility for the establishment and oversight of the Groups risk management framework.The Groups risk management policies are established to set out its overall business strategies, tolerance of risk and general risk management philosophy. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Groups activities.
(b)
Credit risk Credit risk refers to the risk that counterparties may default on their contractual obligations resulting in financial loss to the Group. The Groups exposure to credit risk arises primarily from trade and other receivables. The Group manages these risks by monitoring credit-worthiness and limiting the aggregate risk to any individual counterparty. The Group has adopted a policy of only dealing with creditworthy counterparties as a means of mitigating the risk of financial loss from such defaults. The Group does not require collateral from its customers. Cash balances and fixed deposits are placed with reputable financial institutions of high credit rating. The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and other receivables. The main components of this allowance are a specific loss component that relates to individually significant exposures. The allowance account in respect of trade and other receivables is used to record impairment losses unless the Group is satisfied that no recovery of the amount owing is possible. At that point, the financial asset is considered irrecoverable and the amount charged to the allowance account is written off against the carrying amount of the impaired financial asset. At the reporting date, other than the allowance that has been made as disclosed in Note 10, no further allowances for impairment have been considered necessary in respect of trade and other receivables based on the creditworthiness of the counterparties and credit quality and past collection history of the customers. The Group does not require collateral from its customers. At the reporting date, 5 customers of a subsidiary collectively accounted for approximately 41% (2009: 48%) of total gross trade receivables of the Group as at 31 July 2010. There are no other significant concentration of credit risk to the Group and the Company. The credit risk for trade receivables after allowance for doubtful debts by geography is as follows:
Group 2010 $000 By Geographical areas Singapore Malaysia Hong Kong Australia China Others 2,689 249 38,876 2 2,239 88 44,143 2,428 214 21,022 3 4,204 40 27,911 2009 $000 Company 2010 $000 2009 $000
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28 (c)
FINANCIAL RISK MANAGEMENT (CONTD) Market risk Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates will have on the Groups income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return on risk.
Foreign currency risk

The Groups subsidiaries operate mainly in Singapore, China and Hong Kong. The Group has exposure to foreign currency movements on financial assets and financial liabilities denominated in foreign currencies other than their respective functional currencies. The currencies giving rise to this risk are the Singapore Dollar (SGD), United States Dollar (USD), Australian Dollar (AUD), New Taiwan Dollar (NTD), Chinese Renminbi (RMB) and Hong Kong Dollar (HKD). Such risks are managed by matching sales with corresponding purchases, and assets and liabilities of the same currencies and amounts. The Group does not enter into currency options and does not use forward exchange contracts to protect against volatility associated with foreign currency sales and purchases. The Group is also exposed to currency translation risk on its net investments in foreign operations. Such exposures are reviewed and monitored on a regular basis. The Groups exposure to foreign currencies are as follows: Group
USD SGD equivalent At 31 July 2010 Financial assets: Trade and other receivables Cash and cash equivalents Net currency exposure At 31 July 2009 Financial assets: Trade and other receivables Cash and cash equivalents Net currency exposure 10 10 80 80 7 7 34 34 177 177 6 1 7 314 1 315 67 67 103 103 303 303 1,749 1,749 2 1 3 2,224 1 2,225 $000 AUD $000 NTD $000 HKD $000 RMB $000 Other currencies $000 Total $000
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28 (c)
FINANCIAL RISK MANAGEMENT (CONTD) Market risk (contd)
Foreign currency risk (contd) Sensitivity analysis - Foreign currency risk

A 5% strengthening of the above currencies against the functional currencies of the respective subsidiaries of the Group at the reporting date would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis is based on foreign currency exchange rate variances that the Group considered to be reasonably possible at the end of the reporting period. The analysis assumes that all other variables, in particular interest rates, remain constant and does not take into account the associated tax effects. A 5% weakening of the above currencies against the functional currencies of the respective subsidiaries of the Group would have had the equal but opposite effect to the amounts shown above, on the basis that all other variables remain constant.
Other currencies $000
USD SGD equivalent Group 2010 Increase / (decrease) in profit and loss Increase / (decrease) in equity 2009 Increase / (decrease) in profit and loss Increase / (decrease) in equity 1 1 3 3 $000
AUD $000
NTD $000
HKD $000
RMB $000
Total $000
(5) (5)
15 15
87 87
1 1
101 101
(7) (7)
1 1
1 1
9 9
1 1
6 6
The Companys exposure to foreign currencies are as follows: Company

RMB SGD equivalent At 31 July 2010 Financial assets: Amounts due from subsidiaries Net currency exposure At 31 July 2009 Financial assets: Amounts due from subsidiaries Net currency exposure 593 593 3,589 3,589 122 122 4,304 4,304 599 599 20,673 20,673 108 108 21,380 21,380 $000 HKD $000 Other currencies $000 Total $000
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28 (c)
FINANCIAL RISK MANAGEMENT (CONTD) Market risk (contd)
Foreign currency risk (contd) Sensitivity analysis - Foreign currency risk (contd)
A 5% strengthening of the above currencies against the functional currency of the Company at the reporting date would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis is based on foreign currency exchange rate variances that the Company considered to be reasonably possible at the end of the reporting period. The analysis assumes that all other variables, in particular interest rates, remain constant and does not take into account the associated tax effects. A 5% weakening of the above currencies against the functional currency of the Company would have had the equal but opposite effect to the amounts shown above, on the basis that all other variables remain constant.
Other currencies $000
RMB SGD equivalent Company At 31 July 2010 Increase / (decrease) in profit and loss Increase / (decrease) in profit and loss At 31 July 2009 Increase/(decrease) in profit and loss Increase/(decrease) in equity 30 30 30 30 $000
HKD $000
Total $000
1,034 1,034
5 5
1,069 1,069
179 179
6 6
215 215
Cash flow and fair value interest rate risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates.The Groups bank loans and finance lease liabilities are at fixed rates. The Group is exposed to interest rate risk in respect of fixed deposits and bank overdraft at variable rates.
Sensitivity analysis - Interest rate risk

For fixed deposits at variable rates, an increase of 50 basis points in interest rate at the reporting date would increase profit before tax and equity by less than $1,000. A decrease of 50 basis points in interest rate would have an equal but opposite effect. The magnitude represents managements assessment of the likely movement in interest rates under normal economic conditions. This analysis has not taken into account the associated tax effects and assumes that all other variables, in particular foreign currency rates, remain constant.
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28 (d)
FINANCIAL RISK MANAGEMENT (CONTD) Liquidity risk The Group actively manages its debt maturity profile, operating cash flows and the availability of funding so as to ensure that all refinancing, repayment and funding needs are met. As part of the overall prudent liquidity management, the Group maintains sufficient level of cash to meet its working capital requirement. In addition, the Group strives to maintain available banking facilities of a reasonable level to its overall debt position. The table below analyses the maturity profile of the Groups and Companys financial liabilities based on contractual undiscounted cash flows, including estimated interest payment.
Contractual cash flows Carrying amount $000 Group At 31 July 2010 Trade and other payables Interest-bearing borrowings Finance lease liabilities 9,379 10,215 2,067 21,661 At 31 July 2009 Trade and other payables Interest-bearing borrowings Finance lease liabilities 9,359 8,225 2,836 20,420 Company At 31 July 2010 Trade and other payables Finance lease liabilities 1,811 205 2,016 At 31 July 2009 Trade and other payables Finance lease liabilities 1,286 263 1,549 1,286 315 1,601 1,286 69 1,355 245 245 1 1 1,811 246 2,057 1,811 69 1,880 177 177 9,359 8,730 3,211 21,300 9,359 6,433 1,029 16,821 2,297 2,181 4,478 1 1 9,379 10,818 2,319 22,516 9,379 8,953 950 19,282 1,865 1,369 3,234 Less than 1 year $000 Between 2 and 5 years $000 Over 5 years $000
Total $000
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28 (e)
FINANCIAL RISK MANAGEMENT (CONTD) Estimating the fair values
Available-for-sale financial assets

At the reporting date, the fair value of the available-for-sale unquoted investment is measured using inputs for the asset that are not based on observable market data (unobservable inputs) (Level 3 Fair value hierarchy). It is determined by reference to the latest transaction price.
Finance lease liabilities

The fair value of finance lease liabilities is estimated as the present value of future principal and interest cash flows, discounted at market interest rates for homogeneous lease agreements at the reporting date.
Non-current interest-bearing bank loans

Fair value is estimated as the present value of future cash flows discounted at current interest rates for similar instruments at the balance sheet date.
Financial assets and liabilities

The notional amounts of financial assets and liabilities with a maturity of less than one year (including trade and other receivables, balances with related parties, cash and cash equivalents, trade and other payables, current interest-bearing bank loans and bank overdraft) approximate their fair values because of the short period to maturity. All other financial assets and liabilities are discounted to determine their fair values. The aggregate net fair values of financial assets and liabilities which are not carried at fair value in the balance sheet as at 31 July are presented in the following table:
2010 Carrying amount $000 Group Fixed rate: Finance lease liabilities 1,208 1,208 1,059 1,059 1,930 1,930 1,895 1,895 Fair value $000 Carrying amount $000 2009 Fair value $000
2010 Carrying amount $000 Company Fixed rate: Finance lease liabilities 149 149 140 140 207 207 Fair value $000 Carrying amount $000
2009 Fair value $000
195 195
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29
CAPITAL MANAGEMENT The Groups objectives when managing capital are to safeguard the Groups ability to continue as a going concern and to maintain an optimal capital structure so as to maximise shareholder value. The Group strives to maintain a prudent capital structure. The capital structure of the Group comprises debt, which includes bank loans, bank overdraft, finance lease liabilities and total equity. The Company and its subsidiaries are not subject to externally imposed capital requirements. The Board of Directors monitors capital based on a debt-to-capital ratio. This ratio is calculated as net debt divided by capital. Net debt comprises bank loans, bank overdraft, finance lease liabilities less cash and cash equivalents. Capital comprises total equity. The Groups capital management strategy remains unchanged from 2009.
Group 2010 $000 Total debt - Bank loans and bank overdraft (Note 15) - Finance lease liabilities (Note 16) Less: Cash and cash equivalents Net debt (A) Total equity (B) Debt-to-capital ratio (times) (A)/(B) 10,215 2,067 12,282 (10,772) 1,510 143,001 0.011 8,225 2,836 11,061 (10,775) 286 145,042 0.002 2009 $000
F 59

30
SIGNIFICANT RELATED PARTY TRANSACTIONS Identity of related parties For the purpose of these financial statements, parties are considered to be related to the Group if the Group has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group and the party are subject to common control or common significant influence. Related parties may be individuals or other entities. In addition to the related party information disclosed elsewhere in the financial statements, the following significant transactions between the Group entities were carried out on terms agreed between the parties during the financial year:
Group 2010 $000 From subsidiaries: Management fee income Interest income on non-current receivables Between fellow subsidiaries: Sales to fellow subsidiaries Purchases from fellow subsidiaries 4,630 4,630 3,971 3,971 8,987 1,495 7,871 408 2009 $000 Company 2010 $000 2009 $000
31
Dividends
Company 2010 $000 Paid during the financial year: Final and special dividends proposed of 0.15 cents per share in 2009 paid in 2010 : one-tier tax-exempt Final dividend proposed of 0.13 per share in 2008 paid in 2009 :one-tier tax-exempt Proposed but not recognised as a liability as at 31 July: Final dividend proposed of 0.06 cents (2009 0.11 cents) per share: one-tier tax-exempt Special dividend proposed of nil (2009 0.04 cents) per share: one-tier tax-exempt 927 927 1,699 618 2,317 2,317 1,800 2009 $000
F 60
Statistics of Shareholdings
As at 8 October 2010
DISTRIBUTION OF SHAREHOLDINGS
NO. OF SHAREHOLDERS 43 10,958 5,235 61 16,297
SIZE OF SHAREHOLDINGS 1 - 999 1,000 - 10,000 10,001 - 1,000,000 1,000,001 AND ABOVE TOTAL
% 0.26 67.24 32.12 0.38 100.00
NO. OF SHARES 14,050 38,953,961 389,694,010 1,115,857,353 1,544,519,374
% 0.00 2.52 25.23 72.25 100.00
TWENTY LARGEST SHAREHOLDERS

NO. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 NAME MORGAN STANLEY ASIA (SINGAPORE) SECURITIES PTE LTD CITIBANK NOMINEES SINGAPORE PTE LTD MERRILL LYNCH (SINGAPORE) PTE LTD OCBC SECURITIES PRIVATE LTD MAYBAN NOMINEES (S) PTE LTD UNIGOLD ASIA LIMITED CHENG FU ZAY UOB NOMINEES (2006) PTE LTD DBS VICKERS SECURITIES (S) PTE LTD KIM ENG SECURITIES PTE. LTD. HONG LEONG FINANCE NOMINEES PTE LTD DBS NOMINEES PTE LTD UNITED OVERSEAS BANK NOMINEES PTE LTD UOB KAY HIAN PTE LTD LEOW TZE FEI (LIAO ZHIHUI) LIM TAI FONG OCBC NOMINEES SINGAPORE PTE LTD HSBC (SINGAPORE) NOMINEES PTE LTD LEONG NING CHAN @ LEONG MING CHAN OW CHIN SENG TOTAL NO. OF SHARES 514,140,027 120,827,974 98,041,000 34,861,000 32,881,000 32,845,750 32,566,000 29,320,000 26,127,830 21,509,300 12,902,000 12,727,750 10,990,500 10,287,000 7,171,000 7,000,000 6,346,000 5,007,000 5,000,000 5,000,000 1,025,551,131 % 33.29 7.82 6.35 2.26 2.13 2.13 2.11 1.90 1.69 1.39 0.84 0.82 0.71 0.67 0.46 0.45 0.41 0.32 0.32 0.32 66.39
F 61
Shareholders Information
As at 8 October 2010
Number of equity securities Class of equity securities Voting rights : : : 1,544,519,374 shares Ordinary shares One vote per share
SUBSTANTIAL SHAREHOLDERS (As recorded in the Register of Substantial Shareholders)

Direct Interest Triumph Development Holdings Limited Dr Lee Tsu-Der (1) K K Fong Holdings Pte Ltd (2) Fong Kah Kuen @ Foong Kah Kuen Foo Ai Lan (4) Bioactive Enterprises Limited Tseng An Hsiung Andy (5)
(3)
% 8.93 5.02 1.95 5.78 -
Deemed Interest 137,943,313 77,539,000 107,620,000 149,787,714
% 8.93 5.02 6.97 9.70
137,943,313 77,539,000 30,081,000 89,285,714 -
Notes: (1) Dr Lee Tsu-Der is deemed to be interested in the 137,943,313 shares held by Triumph Development Holdings Limited by virtue of Section 7 of the Companies Act, Cap. 50 (the Act).
(2)
K K Fong Holdings Pte Ltd has a total beneficial interest in the 77,539,000 shares, of which 77,459,000 shares are held in the names of nominees. Fong Kah Kuen @ Foong Kah Kuen is deemed to be interested in the 77,539,000 shares held by K K Fong Holdings Pte Ltd by virtue of Section 7 of the Act. Foo Ai Lan is deemed to be interested in the 77,539,000 shares held by K K Fong Holdings Pte Ltd by virtue of Section 7 of the Act and 30,081,000 shares held by her spouse, Fong Kah Kuen @ Foong Kah Kuen. Tseng Ah Hsiung Andy is deemed to be interested in the 89,285,714 shares held by Bioactive Enterprises Limited and the 58,710,000 shares held by Wellspring Investment Ltd by virtue of Section 7 of the Act and the 1,792,000 shares held by his spouse, Mrs Tseng Shu Eng Eng.
(3)
(4)
(5)
PERCENTAGE OF SHAREHOLDING IN PUBLICS HANDS 72.63 % of the Companys shares are held in the hands of public. Accordingly, the Company has complied with Rule 723 of the Listing Manual of the SGX-ST.
F 62
Notice of Annual General Meeting

XPRESS HOLDINGS LTD (Company Registration No. 199902058Z) (Incorporated in Singapore with limited liability) NOTICE IS HEREBY GIVEN that the Annual General Meeting of Xpress Holdings Ltd (the Company) will be held at No. 1 Kallang Way 2A, Communications Techno Centre, Singapore 347495, on Monday, 15 November 2010, at 9.00 a.m. for the following purposes: AS ORDINARY BUSINESS 1. 2. To receive and adopt the Directors Report and the Audited Accounts of the Company for the year ended 31 July 2010 together with the Auditors Report thereon. (Resolution 1) To declare a first and final tax exempt one-tier dividend of 0.06 cent per share for the year ended 31 July 2010 (2009: first and final tax exempt one-tier dividend of 0.11 cent per share and a special tax exempt one-tier dividend of 0.04 cent per share). (Resolution 2) To re-elect the following Directors of the Company retiring pursuant to Articles 76 and 94(2) of the Articles of Asso ciation/Byelaws of the Company: Mr Fong Kah Kuen @ Foong Kah Kuen Mr Darlington Tseng Te-Lin Mr Khoo Choon Meng Mr Lai Hock Meng [Retiring under Article 76] [Retiring under Article 94(2)] [Retiring under Article 94(2)] [Retiring under Article 94(2)] (Resolution (Resolution (Resolution (Resolution 3) 4) 5) 6)
3.
*Mr Lai Hock Meng will, upon re-election as Director of the Company, remain as member of the Audit, Remuneration and Investment and Risk Management Committees and will be considered independent.
4. 5. 6. To approve the payment of Directors fees of S$273,000 for the year ended 31 July 2010 (2009: S$237,000). (Resolution 7) To re-appoint Messrs Foo Kon Tan Grant Thornton as the Auditors of the Company and to authorise the Directors of the Company to fix their remuneration. (Resolution 8) To transact any other ordinary business which may properly be transacted at an Annual General Meeting.
AS SPECIAL BUSINESS To consider and if thought fit, to pass the following resolutions as Ordinary Resolutions, with or without any modifications: 7. Authority to issue shares That pursuant to Section 161 of the Companies Act, Cap 50 and Rule 806 of the Listing Manual of the Singapore Exchange Securities Trading Limited, the Directors of the Company be authorised and empowered to: (a) (i) (ii) issue shares in the Company (shares) whether by way of rights, bonus or otherwise; and/or make or grant offers, agreements (collectively,Instruments) that might or would require shares to be issued, including but not limited to the creation and issue of (as well as adjustments to) options, warrants, debentures or other instruments convertible into shares,
at any time and upon such terms and conditions and for such purposes and to such persons as the Directors of the Company may in their absolute discretion deem fit; and
F 63

(b) (notwithstanding the authority conferred by this Resolution may have ceased to be in force) issue shares in pursuance of any Instruments made or granted by the Directors of the Company while this Resolution was in force, provided that, the aggregate number of shares (including shares to be issued in pursuance of the Instruments, made or granted pursuant to this Resolution) to be issued pursuant to this Resolution shall not exceed fifty per centum (50%) of the total number of issued shares in the capital of the Company (as calculated in accordance with sub-paragraph (2) below), of which the aggregate number of shares to be issued other than on a pro rata basis to shareholders of the Company shall not exceed twenty per centum (20%) of the total number of issued shares in the capital of the Company (as calculated in accordance with sub-paragraph (2) below); (subject to such calculation as may be prescribed by the Singapore Exchange Securities Trading Limited) for the purpose of determining the aggregate number of shares that may be issued under sub-paragraph (1) above, the total number of issued shares shall be based on the total number of issued shares in the capital of the Company at the time of the passing of this Resolution, after adjusting for: (a) (b) (c) (3) new shares arising from the conversion or exercise of any convertible securities; new shares arising from exercising share options or vesting of share awards which are outstanding or subsisting at the time of the passing of this Resolution; and any subsequent consolidation or subdivision of shares;
(1)
(2)
in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Listing Manual of the Singapore Exchange Securities Trading Limited for the time being in force (unless such compliance has been waived by the Singapore Exchange Securities Trading Limited) and the Articles of Association of the Company; and unless revoked or varied by the Company in a general meeting, such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held, whichever is earlier. [See Explanatory Note] (Resolution 9)
(4)
By Order of the Board Yeo Poh Noi Caroline Secretary Singapore, 29 October 2010
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Explanatory Note: The Ordinary Resolution 9 in item 7 above, if passed, will empower the Directors of the Company, effective until the conclusion of the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is required by law to be held or such authority is varied or revoked by the Company in a general meeting, whichever is the earlier, to issue shares, make or grant Instruments convertible into shares and to issue shares pursuant to such Instruments, up to a number not exceeding, in total, 50% of the total number of issued shares in the capital of the Company, of which up to 20% may be issued other than on a pro-rata basis to shareholders. For determining the aggregate number of shares that may be issued, the total number of issued shares will be calculated based on the total number of issued shares (excluding treasury shares) in the capital of the Company at the time this Ordinary Resolution is passed after adjusting for new shares arising from the conversion or exercise of any convertible securities or share options or vesting of share awards which are outstanding or subsisting at the time when this Ordinary Resolution is passed and any subsequent consolidation or subdivision of shares.
Notes: 1. 2. A Member entitled to attend and vote at the Annual General Meeting (the Meeting) is entitled to appoint a proxy to attend and vote in his/her stead. A proxy need not be a Member of the Company. The instrument appointing a proxy must be deposited at the Registered Office of the Company at No. 1 Kallang Way 2A, Communications Techno Centre, Singapore 347495 not less than forty-eight (48) hours before the time appointed for holding the Meeting..
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XPRESS HOLDINGS LTD

(Company Registration No. 199902058Z) (Incorporated in Singapore with limited liability)
IMPORTANT: 1. For investors who have used their CPF monies to buy Xpress Holdings Ltds shares, this Report is forwarded to them at the request of the CPF Approved Nominees and is sent solely FOR INFORMATION ONLY. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them. CPF investors who wish to attend the Meeting as an observer must submit their requests through their CPF Approved Nominees within the time frame specified. If they also wish to vote, they must submit their voting instructions to the CPF Approved Nominees within the time frame specified to enable them to vote on their behalf.
2.
3.
PROXY FORM
(Please see notes overleaf before completing this Form)

I/We, of
being a member/members of Xpress Holdings Ltd (the Company), hereby appoint:

Name Address and/or (delete as appropriate) Name Address NRIC/Passport No. Proportion of Shareholdings No. of Shares % NRIC/Passport No. Proportion of Shareholdings No. of Shares %
or failing the person, or either or both of the persons, referred to above , the Chairman of the Meeting as my/our proxy/ proxies to vote for me/us on my/our behalf at the Annual General Meeting (the Meeting) of the Company to be held on 15 November 2010 at 9.00 a.m. and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the Meeting as indicated hereunder. If no specific direction as to voting is given or in the event of any other matter arising at the Meeting and at any adjournment thereof, the proxy/proxies will vote or abstain from voting at his/her discretion. The authority herein includes the right to demand or to join in demanding a poll and to vote on a poll. (Please indicate your vote For or Against with a tick [] within the box provided.)
No. 1 2 3 4 5 6 7 8 9 Resolutions relating to: Directors Report and Audited Accounts for the year ended 31 July 2010 Payment of proposed first and final tax exempt one-tier dividend Re-election of Mr Fong Kah Kuen @ Foong Kah Kuen as a Director Re-election of Mr Darlington Tseng Te-Lin as a Director Re-election of Mr Khoo Choon Meng as a Director Re-election of Mr Lai Hock Meng as a Director Approval of Directors fees amounting to S$273,000 Re-appointment of Messrs Foo Kon Tan Grant Thornton as Auditors Authority to issue new shares For Against
Dated this
day of
2010 Total number of Shares in: (a) CDP Register No. of Shares
Signature of Shareholder(s) or, Common Seal of Corporate Shareholder

*Delete where inapplicable
(b) Register of Members
Notes: 1. Please insert the total number of Shares held by you. If you have Shares entered against your name in the Depository Register (as defined in Section 130A of the Companies Act, Chapter 50 of Singapore), you should insert that number of Shares. If you have Shares registered in your name in the Register of Members, you should insert that number of Shares. If you have Shares entered against your name in the Depository Register and Shares registered in your name in the Register of Members, you should insert the aggregate number of Shares entered against your name in the Depository Register and registered in your name in the Register of Members. If no number is inserted, the instrument appointing a proxy or proxies shall be deemed to relate to all the Shares held by you. A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attend and vote in his/her stead. A proxy need not be a member of the Company. Where a member appoints two proxies, the appointments shall be invalid unless he/she specifies the proportion of his/her shareholding (expressed as a percentage of the whole) to be represented by each proxy. Completion and return of this instrument appointing a proxy shall not preclude a member from attending and voting at the Meeting. Any appointment of a proxy or proxies shall be deemed to be revoked if a member attends the meeting in person, and in such event, the Company reserves the right to refuse to admit any person or persons appointed under the instrument of proxy to the Meeting. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at No. 1 Kallang Way 2A, Communications Techno Centre, Singapore 347495 not less than 48 hours before the time appointed for the Meeting. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its seal or under the hand of an officer or attorney duly authorised. Where the instrument appointing a proxy or proxies is executed by an attorney on behalf of the appointor, the letter or power of attorney or a duly certified copy thereof must be lodged with the instrument. A corporation which is a member may authorise by resolution of its directors or other governing body such person as it thinks fit to act as its representative at the Meeting, in accordance with Section 179 of the Companies Act, Chapter 50 of Singapore.
2. 3. 4.
5.
6.
7.
General: The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible, or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if the member, being the appointor, is not shown to have Shares entered against his name in the Depository Register as at 48 hours before the time appointed for holding the Meeting, as certified by The Central Depository (Pte) Limited to the Company.
Group Structure
xpress holdings ltd
100% Xpress Print (Pte) Ltd
100% Precise Media Group Limited
100% Xpress Print (Shenzhen) Co., Ltd
100% Xpress Holdings Xpress Print (Korea Branch Office) (Vietnam) Co., Ltd
76% Xpress Print (Australia) Pty Ltd
100% Print Planner (Hong Kong) Limited
50% Shenzhen Xpress Wisdom Translation Co., Ltd
100% Xpress Print (K.L.) Sdn Bhd
100% Print Planner (Shanghai) Co., Ltd
100% Xpress Print (Shenzhen) Co., Ltd Xiamen Branch
100% Xpress Print (H.K.) Limited
100% Print Planner (Shenzhen) Co., Ltd
100% Xpress Print (Shenzhen) Co., Ltd Wuhan Branch
100% Xpress Media Pte Ltd
100% Shenzhen Xpress Print Technology Co., Ltd 100% Print Planner (Intl) Limited
100% Xpress Print (Shenzhen) Co., Ltd Changsha Branch
100% Xpress Media Philippines Inc.
100% Print Planner (Chengdu) Co., Ltd
100% Xpress Print (Shenzhen) Co., Ltd Guangzhou Branch
100% Xpress Print (Taiwan Branch Office)
100% Print Planner (Beijing) Co., Ltd
100% Xpress Print (Shenyang) Co., Ltd
XPRESS HOLDINGS LTD 1 KALLANG WAY 2A SINGAPORE 347495 TEL +65 6880 2828 FAX +65 6274 1980

XPRS Xpress Annual Report 2010 - Expanding Asia-Pacific Footprints

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XPRS Xpress Annual Report 2010 - Expanding Asia-Pacific Footprints

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Expanding Footprints

Xpress Holdings Ltd Annual Report

Expanding ASIA PACIFIC Footprints

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

GROUP REVENUE ($M)

OPERATING PROFIT ($M)

5.7 4.8 4.2 4.7

Expanding ASIA PACIFIC Footprints

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

FOREST STEWARDSHIP COUNCIL FSC CERTIFICATION

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

THE BEST INNOVATION SOLUTIONS SUPPLIER OF YEAR 2009 AWARD

BUSINESS SUPERBRANDS AWARD 2010

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Xpress China Footprints

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

INVESTMENT AND RISK MANAGEMENT COMMITTEE

Ms Yeo Poh Noi Caroline

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Digitisation and the Proliferation of Content

Becoming a Global Leader in Print Solutions

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

anks and Appreciation

Dr Wang Kai Yuen

Independent Non-Executive Chairman 15 October 2010

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Letter from the Audit Committee Chair

Audit Committee Chairman 15 October 2010

Mr Christopher Chong Meng Tak

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Dr Wang Kai Yuen

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Victor Khoo Choon Meng

Mr Darlington Tseng Te-Lin

Mr Victor Khoo Choon Meng

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Lai Hock Meng

Ong Wui Leng

Mr Christopher Chong Meng Tak

Mr Lai Hock Meng

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Sam Chong Keen

Jerry Lee Yin Chia

Xpress Holdings Ltd Annual Report 2010

Expanding ASIA PACIFIC Footprints

Ronnie Yo Ngan Kia