BUILDING STRENGTH IN ADVERSITY ANNUAL REPORT 2023
EMBRACING THE ESSENCE OF RESILIENCE, HARNESSING INNER COURAGE AND MAINTAINING A POSITIVE OUTLOOK TO EMPOWER US TO FACE CHALLENGES AND TO BUILD STRENGTH IN ADVERSITIES – IN ADVERSITY WE FIND STRENGTH.
1988 Megachem’s Journey began on 12 September 1988 in Singapore as a distributor of chemicals. 1989 Within a year of operation we expanded into the Malaysian market. 1992 We acquired 49% of Megachem Thailand Co., Ltd. 1993 Success in Singapore, Malaysia and Thailand led us to expand further into Indonesia. 1994 We moved to our own 46,000 sf office/ warehouse in Tuas. 2005 India liaison office was set up as part of strategy to establish a global market. With a plan to penetrate the China market further, a branch office was set up in Beijing. 2008 The establishment of our subsidiary in Dubai, UAE demonstrated our commitment towards building a global network. Megachem celebrated its 20 years in business with a record year of sales revenue. 2009 Megachem emerged from the US financial crisis with record level sales in FY 2009. We converted our liaison office in India to a subsidiary as we positioned ourselves for further growth. 2010 Megachem achieved record sales and profit for FY 2010. Our representative office in Vietnam was converted to a wholly-owned subsidiary to strengthen our footprint there. 2012 Completion of the expansion of its production facility in Singapore, laid the platform for accelerating growth in our manufacturing activities. Megachem welcomed Chori, a leading Japanese trading group, as Shareholder and Partner. Both Chori and MegaChem are expected to benefit from each other’s synergistic capabilities in chemicals. 2014 As part of our effort to strengthen our logistical infrastructure, Megachem purchased a piece of industrial land in Malaysia which will lead to greater cost efficiency and enable us to serve our customers better. 2022 Megachem secured its first Sustainability-linked financing. This sustainability-linked financing from UOB is a key step in our sustainability journey and a clear demonstration of our commitment to be a responsible member of the community, together with our customers, suppliers, as well as our other stakeholders. Doing our part towards a greener future, we installed solar panels at our Singapore facility which will enable us to reduce our energy cost and more importantly to reduce global warming. The solar panel facility was funded by OCBC. Megachem is proud to be a Gold recipient of the EcoVadis Sustainability Ratings. In its Sustainability Assessment Report 2022, EcoVadis placed Megachem among the Top 3% of companies of the same category that were assessed by them. This accolade is a testimony of the importance we place Sustainability in our overall strategy and a recognition of our Sustainability achievements. As part of our plan to strengthen our supply chain infrastructure, we completed the construction of our warehouse in Malaysia. 2023 35th Anniversary – Celebrating past Successes. Shaping a Better Future. 2011 We purchased another industrial building in Singapore to develop its manufacturing activities as an engine of growth. Establishment of a subsidiary in Australia further expanded Megachem’s geographic footprint. Megachem delivered yet another year of record sales and profit for FY 2011. Sales surpassed S$100 million mark for the first time. MEGACHEM LIMITED ANNUAL REPORT 2023 02 OUR 35 YEARS JOURNEY
2000 To tap onto the rapidly growing China market, we set up a subsidiary in Shanghai. In the same year, we ventured into the European market with a presence in the UK. 2001 At the turn of the new millennium, we made our foray into manufacturing with an objective of transforming Megachem into an integrated specialty chemical business. 2004 In 2004, a representative office was set up in Vietnam to tap on the potential in the Vietnam market. 2015 Megachem won 4 awards at the prestigious Singapore Corporate Awards, including the Best Managed Board(Gold) in the “<$300 million market capitalisation” category. 2016 Megachem won 2 awards at the prestigious Singapore Corporate Awards. 2017 Megachem (Thailand) Public Company Limited made a successful IPO debut on the Stock Exchange of Thailand-Market for Alternative Investment. The listing marks a key milestone for the Group, and is aligned with our plans to expand our presence in Asia. Megachem won the Best Annual Report Award (Gold) in the “less than $300 million market capitalisation” category. 2018 Through our Thailand associated company, we acquired a chemical distributor in Thailand whose key product of ethanol is widely used in sanitisers and cosmetics. The acquisition enhances the Group’s product portfolio and widen our industry coverage thereby strengthening our market position in Thailand. Megachem was accorded the Best Managed Board Award (Bronze), in the “less than $300 million market capitalisation” category at the 2018 Singapore Corporate Awards. The award attests to our commitment towards upholding good corporate governance and board performance. 2021 Through our Thailand associated company, we acquired 55% of Green Leaf Chemical Co., Ltd which is a distributor of chemicals for use in the manufacturing of personal care products. The acquisition seeks to enhance the Group’s product portfolio and deepen our coverage of the personal care industry. 1999 We expanded our geographical footprint further with a presence in Philippines. We establish our own quality control and applications laboratory to provide quality control and technical support to our customers. 2003 In October Megachem moved itself to the bigger stage with the listing of its shares in the Singapore Stock Exchange-SESDAQ, now known as the Catalist. The public share issue received overwhelming response with oversubscription of 472 times. Its shares commenced trading on 17 October 2003. MEGACHEM LIMITED ANNUAL REPORT 2023 03 OUR 35 YEARS JOURNEY
PAGE 06...................... CHAIRMAN’S MESSAGE PAGE 08...................... OUR WORLD OF CHEMISTRY PAGE 10...................... OUR PROSPECTS & STRATEGY PAGE 11...................... OUR CORPORATE PROFILE PAGE 13...................... OUR BUSINESS MODEL PAGE 14...................... OUR GLOBAL FOOTPRINT PAGE 16...................... WHY MEGACHEM PAGE 18...................... DEFINING MEGACHEM PAGE 19...................... BOARD OF DIRECTORS PAGE 24...................... SENIOR MANAGEMENT This annual report has been reviewed by the Company’s sponsor, SAC Capital Private Limited (“Sponsor”). This annual report has not been examined or approved by the Singapore Exchange Securities Trading Limited (“Exchange”) and the Exchange assumes no responsibility for the contents of this annual report, including the correctness of any of the statements or opinions made, or reports contained in this annual report. The contact person for the Sponsor is Mr Bernard Lim (Tel: (65) 6232 3210) at 1 Robinson Road #21-00 AIA Tower Singapore 048542. PAGE 25...................... OUR HUMAN CAPITAL PAGE 26...................... OUR ACHIEVEMENT PAGE 27...................... CORPORATE INFORMATION PAGE 28...................... GLOBAL OFFICE CONTACT PAGE 29...................... FINANCIAL HIGHLIGHTS PAGE 32...................... OPERATING AND FINANCIAL REVIEW PAGE 42...................... SHARE INFORMATION PAGE 43...................... DIVIDEND PAGE 44...................... YEAR IN REVIEW PAGE 45...................... FINANCIAL CALENDAR PAGE 46...................... INVESTOR RELATIONS PAGE 48...................... RISK MANAGEMENT PAGE 52...................... CORPORATE GOVERNANCE REPORT PAGE 75...................... SUSTAINABILITY REPORT PAGE 103.................... TCFD DISCLOSURE PAGE 106.................... GRI CONTENT INDEX PAGE 110.................... FINANCIAL STATEMENTS PAGE 178................. STATISTICS OF SHAREHOLDING PAGE 180................. NOTICE OF ANNUAL GENERAL MEETING PROXY FORM MEGACHEM LIMITED ANNUAL REPORT 2023 04 TABLE OF CONTENTS
SALES S$123.0 MIL 14.4% NET LOSS (S$5.8 MIL) NET PROFIT (Adj)* S$1.9 MIL 68.0% FULL YEAR DIVIDEND nil *Adjusted for a one-off impact from a fire incident MEGACHEM LIMITED ANNUAL REPORT 2023 05 RESULTS AT A GLANCE
DEAR VALUED SHAREHOLDERS, On behalf of the Board of Directors, I am pleased to present to you Megachem’s annual report for the financial year ended 31 December 2023 (“FY 2023”). CHALLENGING YEAR IN FY 2023 FY 2023 proved to be a difficult year for Megachem as both external and internal events had resulted in a certain degree of impact to our business operation. Economic uncertainty and ongoing geopolitical events have led to a weak demand and inventory overhang in the chemical industry.Apart from that, the fire incident at Megachem’s warehouse facility in the morning of 5 July 2023 resulted in the Group’s first ever loss in its history. Despite these challenges and setbacks, Megachem’s diversified business model, across a wide spectrum of products and customer base, provides resilience. Our diversity in terms of markets, global customers and suppliers, has proven to be the key competitive differentiation that sets us apart. Furthermore, with our agility, Megachem continues to seize growth opportunities time and time again and stay resilient notwithstanding several major economic recessions throughout the years. RESILIENT PERFORMANCE DESPITE ONE-OFF IMPACT For FY 2023, Megachem’s revenue stood at S$123.0 million, a decline of 14.4% as compared to the S$143.7 million in the previous financial year ended 31 December 2022 (“FY 2022”).The fall in revenue was broad-based across its various market segments and in both distribution and manufacturing activities. In line with the lower sales, gross profit decreased by 34.6% to S$22.5 million and gross profit margin declined to 18.3%, compared to 23.9% in FY 2022. Adjusting for the impact of the fire incident, gross profit margin and gross profit would be 23.1% and S$28.5 million respectively. Total operating expenses (excluding finance cost) increased by 12.3% year-on-year, mainly due to the fire incident. Expenses such as customer compensation claims, demolition and We will continue to strengthen and solidify our foundation of a diverse geographic and product base to remain competitive and provide value-added solutions to a pool of global customers. LEE BON LEONG Independent & Non-Executive Chairman MEGACHEM LIMITED ANNUAL REPORT 2023 06 CHAIRMAN’S MESSAGE
decontamination costs and higher waste disposal costs were incurred. Excluding the one-off fire incident, total operating expenses would be lower by 6.1% year-on-year. As a whole, Megachem recorded a net loss of S$5.8 million in FY 2023 as compared to a net profit after tax of S$6.1 million in FY 2022. Excluding the one-off net impact of the fire incident, Megachem would have remained in the black, with a net profit after tax of S$1.9 million. Loss per share for FY 2023 came in at 4.43 cents as compared to earnings per share of 4.41 cents in FY 2022. Net asset value per share decreased to 37.48 cents as at 31 December 2023, from 43.96 cents as at 31 December 2022. The Group’s financial position remained sound and healthy, with cash and bank balances of S$13.6 million as at 31 December 2023, as compared to S$11.9 million as at 31 December 2022. Net gearing ratio stayed at a healthy level of 0.30 times as at 31 December 2023. Overall, our prudent financial discipline has allowed us to maintain a healthy financial position, giving us financial flexibility to tide through this difficult moment for future business growth and expansion. TACKLING UNCERTAINTIES AHEAD We can expect that 2024 will continue to be a year of uncertainties, given the on-going Russia-Ukraine war and the Israel-Hamas conflict which had caused disruptions to supply chain and hence posed a risk to the overall economic growth. Even though global inflationary pressure recently eased, leading to a pause in interest rate hikes, factors such as high costs and tepid demand may continue to be a drag on the economy and business activities. Given these uncertainties ahead, we will need to remain focused and nimble so that we can better handle these uncertainties in the near term. TAPPING LONG-TERM OPPORTUNITIES In the longer term, given the large population size and developing middle class, the Asian region will remain the key area that contributes towards our main growth engine. Chemicals have been said to be the “industry of industries”.We anticipate that as Asia’s production capacity expands, driven by flourishing market potential and investments, the demand for chemicals will likewise increase. To capture the various opportunities upon the improvement in business conditions, we will continue to strengthen and solidify our foundation of a diverse geographic and product base to remain competitive and provide value-added solutions to a pool of global customers. We will continue to work closely with our customers through the enhancement of our product offerings and provide effective one-stop solutions to them as well.Apart from prioritising our customers’ need, we will also leverage on our track record of operational excellence, prudent financial management and diversified business model to create long-term value for our stakeholders. SUSTAINABLE CHEMISTRY Megachem has always deemed sustainability to be one of our top priorities in creating long-term value for our stakeholders.We will continue to prioritise sustainability in our operations and to collaborate with our stakeholders in building a better world for everyone. WORDS OF APPRECIATION I would like to express my heartfelt appreciation to the management team, staff, bankers and business associates for their commitment and support in allowing us to get this far. I want to convey my deepest appreciation as well to my fellow independent directors, who together with me will be stepping down to make way for board renewal, for their contributions. Finally, I would like to express my gratitude to our shareholders for their continuous unwavering support. I believe that Megachem is well-positioned to take on new opportunities as they present themselves by capitalising on our strengths and diversified product offering to provide clients with one-stop solutions.We will work towards building a more sustainable speciality chemicals business for our clients while focusing on executing our Asia-centric strategy. LEE BON LEONG Independent and Non-Executive Chairman Megachem Limited MEGACHEM LIMITED ANNUAL REPORT 2023 07 CHAIRMAN’S MESSAGE
MAKING THE WORLD A BRIGHTER PLACE PERFORMANCE COATINGS AND POLYMERS • Paints and Inks • Polymerisation • Adhesives • Construction • Textile ENABLING TECHNOLOGIES SURFACE TECHNOLOGY • Electronics • Metal Finishings • Industrial Cleaning • Water Treatment • Pulp & Paper NOURISHING OUR WELL-BEING BIOTECH • Food and Beverages • Pharmaceuticals • Nutraceuticals • Cosmeceuticals • Homecare • Flavours/Fragrances • Agriculture • Feeds MEGACHEM LIMITED ANNUAL REPORT 2023 08 OUR WORLD OF CHEMISTRY
ENERGISING OUR WORLD OIL & GAS/RESOURCES • Petrochemicals • Lubricants & Grease • Oil Fields • Refinery • Oleochemicals • Mining DRIVING PERFORMANCE ADVANCED POLYMER COMPOSITES • Rubber • Plastics • Polyurethane • Polyesters MEGACHEM LIMITED ANNUAL REPORT 2023 09 OUR WORLD OF CHEMISTRY
ECONOMY 2024 will continue to be a year of uncertainties, marked by the ongoing Russia-Ukraine war and the Israel-Hamas conflict. Even though global inflationary pressure has eased recently, leading to a pause in interest rate hikes, high costs and tepid demand may continue to be a drag on the economy and business activities. CHEMICAL INDUSTRY Although the excess inventory situation has somewhat improved, following a period of destocking, recovery in demand for chemicals FIRE INCIDENT On 5 July 2023, Megachem informed shareholders via an SGX announcement that a fire broke out on the same day at 132 Pioneer Road where our warehouse is located. Our immediate priority then was to minimise the disruption of product supply to our customers. About 60-70% of the Company’s inventory is stored in third party warehouses which enables us to continue a major part of our business.As for the products which were destroyed during the fire, we took immediate steps to replenish them in accordance with customers’ requirements so that our inventory level can return to optimal level. The fire incident had a total negative impact of approximately S$7.7 million on our profitability for FY 2023, resulting in our first ever loss after tax of S$5.8 million. Excluding the one-off impact of the fire, there would have been a net profit after tax of S$1.9 million in FY 2023. REBUILDING OUR WAREHOUSE The groundwork for the rebuilding of our warehouse has commenced. Various professionals required for the rebuilding have been appointed. The commencement of the rebuilding is pending regulatory clearance.We expect the construction, which will take approximately 1 year, to commence sometime in the middle of 2024. While the reconstruction of the warehouse will increase our cost in the short term, the new warehouse, which is also safer and environmentally friendly, will lead to lower warehousing cost in the longer term.This will enhance our competitiveness. may remain sluggish in line with benign economic conditions. Supply chain disruption arising from Middle East conflict also poses a risk to recovery. MEGACHEM Given that the global business environment is expected to remain challenging for 2024, Megachem will continue to adopt a cautious stance as the uncertainties ahead weighing on the global economy may pose downside risks to our business. OUR STRATEGY (CHemical)+Re(Action)2: for- Gr{OW}th The Megachem formula for growth is a reaction of 3 key strategies creating a chemistry that will elevate us to a different level of growth. We develop our strategies around the key pillars of geographic network, product offerings and industry coverage. Combine these with our supply chain infrastructure and close relationships with customers and suppliers, Megachem will be well positioned to grow its business, thereby enhancing value for our shareholders. MEGACHEM LIMITED ANNUAL REPORT 2023 10 OUR PROSPECTS
YOUR TOTAL CHEMICAL SOLUTIONS PARTNER Established in 1988, Megachem has since emerged as a leading chemical player in Singapore and the region. Listed on the Singapore Stock Exchange in 2003, we are today a global one-stop specialty chemical solutions provider, offering integrated value-added services including contract manufacturing tailored to customers’ needs as well as distribution of specialty chemicals. We have a global presence and diverse customer base from a wide spectrum of industries. Our technical capabilities, supply chain infrastructure and professional team serve to ensure total customer satisfaction. MEGACHEM LIMITED ANNUAL REPORT 2023 11 OUR CORPORATE PROFILE
SERVING YOU GLOBALLY WITH ONE-STOP SUPPLY OF SPECIALTY CHEMICALS PROVIDING INTEGRATED VALUE-ADDED SOLUTIONS A PREMIUM PROVIDER OF CHEMICAL CONTRACT MANUFACTURING SERVICES MEGACHEM LIMITED ANNUAL REPORT 2023 12 OUR CORPORATE PROFILE
DISTRIBUTION PRODUCERS CUSTOMERS MANUFACTURING/CUSTOM BLENDING PURCHASE VENDOR MANAGED INVENTORY STORE TRANSPORT AUXILIARY SERVICES TECHNICAL SUPPORT CUSTOM BLENDING VALUE-ADDING IN THE CHEMICAL SUPPLY CHAIN • Wide product portfolio >1,000 types and grades of chemicals • Global Sourcing Network -China, Europe, Japan, US, India • Global Distribution Network -presence in 12 countries • Strong customer base >2,000 customers • Providing Just-in-Time delivery and Vendor- Managed Inventory Service • Mixing and Blending according to customers’ formulations • Repackaging from bulk to smaller packaging • Filling, packaging and labeling • Technical support from dedicated application laboratories MEGACHEM LIMITED ANNUAL REPORT 2023 13 OUR BUSINESS MODEL
CONNECTING TO THE WORLD OF OPPORTUNITIES With an extensive global network and strategic locations in Asia, we are well-positioned to develop strategic relationships and forging winning formula in a challenging business landscape. MEGACHEM LIMITED ANNUAL REPORT 2023 14 OUR GLOBAL FOOTPRINT
SINGAPORE PHILIPPINES INDONESIA VIETNAM THAILAND UK MALAYSIA AUSTRALIA CHINA INDIA MIDDLE EAST MYANMAR GLOBAL SOURCING GLOBAL MARKETS MEGACHEM LIMITED ANNUAL REPORT 2023 15 OUR GLOBAL FOOTPRINT
Extensive global network Our extensive network in Singapore, Malaysia, Indonesia,Thailand, Philippines, Vietnam, Myanmar, China, India, Middle East, Australia and the UK enables us to serve our customers globally. Our direct presence in these markets offers a premium service level and minimized operating cost for our customers. Our integrated network also allows for cross-border exchange of market information and enables us to connect our suppliers to their desired markets Strong customer base Over the years we have developed a strong and diversified customer base comprising largely multinationals companies spreading across a wide range of industries.This is a testimony of their confidence in us and of our ability to deliver long-term value to them. Outstanding product portfolio We carry a wide range of products which provides a one-stop shop and enables us to be a key supplier to our customers. Quality supply source Our suppliers have proven track records in quality, consistency, competitive pricing and supply reliability. A strong presence in Asia has helped several of our principal suppliers to penetrate key markets, which led to our appointment as their sole distributor and business partner. Efficient supply chain solutions Our warehousing facilities stock different classes and grades of specialty chemicals. Coupled with an efficient logistics support and just-in-time inventory controls, we are able to help customers improve their inventory planning and reduction of inventory costs. Sophisticated it infrastructure Megachem invests heavily in a worldclass IT infrastructure including mySAP Business Suite software.This enhances our service efficiency as well as provides seamless information exchange which gives us a competitive advantage over our competitors. YOUR COMPETITIVE ADVANTAGES As our customers Competitive Product Pricing Megachem can act as a single source supplier of a full suite of OUR COMPETITIVE STRENGTHS,YOUR COMPETITIVE ADVANTAGES Every single element has to be exactly in place to create the desired formula for success and Megachem has been building this winning formula over the decades. Several vital ingredients make up this potent formula: Our integrated solutions, superior manufacturing capability, extensive global network, our strong customer base, outstanding product portfolio, efficient supply chain solutions and sophisticated IT support services. Together, these elements give our customers the competitive edge they seek, making us their indispensable partner on their journey to growth. OUR COMPETITIVE STRENGTHS Integrated specialty chemical Solutions provider Megachem’s capabilities in proprietary chemical products manufacturing, contract manufacturing and global distribution provide customers with integrated solutions, thus adding higher value to them. These make us a one-stop shop where customers can find total solutions. Superior manufacturing capability In contract manufacturing, we add value by blending materials according to our customers’ formulation and specific requirements. With our proven track record with several multinationals, customers can confidently outsource to us their non-core production activities so that they can focus on what they do best - making their business grow. MEGACHEM LIMITED ANNUAL REPORT 2023 16 WHY MEGACHEM?
products, offering you increased product cost effectiveness.Through product bundling, overall product cost and freight cost can be reduced for our customers. Process and Operational Cost Efficiency Instead of having a big procurement team inquiring with several suppliers, negotiating prices, terms and conditions with each of them, you can rely on us as one single point of contact. By consolidating your chemical materials requirements and outsourcing to us, it enables you to focus your time and effort on your core activities. We can source and order your products for you, store them in close proximity to your production locations and deliver them not before or after they are needed; instead, they arrive “just-intime” as they are needed, effectively reducing operational costs such as warehousing and inventory obsolescence. Product Options Megachem has global sourcing network around the world with the ability to source for quality products at economical cost.We are able to offer various alternatives for your chemical raw material requirements by offering wider choices in terms of product quality and pricing. Optimum Service Level Megachem partners many multinationals companies, serving them as a global supplier. For these companies our Key Accounts Managers provide impeccable level of personalised services and offer customised solutions. Adding Value Through Contract Manufacturing Megachem adds further value to your business by providing contract manufacturing services.We can source the raw materials for you, store them in our warehouses, produce the finished products according to your formulations, pack them according to your requirements and deliver them directly to you or your customers. By engaging us as your contract manufacturer, your non-core production is outsourced to us and in so doing reduces your capital expenditure, production and other related costs. Outsourcing your non-core productions to us also enables you to penetrate key markets in Asia without investing heavily in capital expenditure. As our suppliers Your Partner in Growing your Markets As a supplier to us, we add value to you by bringing your products to your desired markets.We do so by leveraging on our extensive network around the world, especially in Asia where there is a tremendous potential for growth. Supported by an efficient logistical infrastructure and our in-depth market knowledge, we can assist you in developing your markets bigger and faster. Streamlining your Distribution Channels Acting as your distributor, you can outsource smaller customer accounts to us, enabling you to channel your resources towards the bigger customers thus streamlining your distributions channels, operations and reducing your operational cost. Reducing your Inventory Cost By appointing us as your distributor, you will be able to reduce your inventory holding cost. Our robust inventory management system and strong supply chain infrastructure will ensure sufficient level of stocks to meet customers’ demand within shortest possible delivery time. Market Information Sharing We view our suppliers as important business partners.As such, we have open channels of sharing and communication of market knowledge and information to keep our suppliers abreast of market developments. MEGACHEM LIMITED ANNUAL REPORT 2023 17 WHY MEGACHEM?
SUPPORTING MEGACHEM’S KEY SUCCESS FACTORS IS THE INVIGORATING DEEP CULTURE – ONE THAT BONDS THE SPIRIT OF OUR PEOPLE TOGETHER WITH COMMON VALUES, EASILY RECOGNIZABLE IN THE CONDUCT OF OUR BUSINESS We constantly DIFFERENTIATE ourselves to stay ahead of competition We are ENERGIZED towards realizing our vision in everything that we do We constantly pursue better ways to ENGAGE with our business partners to achieve mutually beneficial relationship Our people are committed to EXECUTE and deliver quality results Because we truly believe in our PASSION to better serve and deliver our best We are a PERFORMANCE-DRIVEN organization We embrace CHANGE to stay relevant. MEGACHEM LIMITED ANNUAL REPORT 2023 18 DEFINING MEGACHEM
MR LEE BON LEONG, JP,PBM,BBM,AGE 77 Independent and Non-Executive Chairman Date of first appointment as a Director: 5 September 2003 Date of last re-election as a Director: 16 April 2021 Length of service as a Director: 20 years and 6 months Country of principal residence: Singapore Board’s comments on the appointment Not applicable, Mr Lee Bon Leong will retire at the Company’s forthcoming annual general meeting. Board committee memberships Chairman of Nominating Committee Member of Audit Committee Member of Remuneration Committee Academic and professional qualifications Masters of Law from the National University of Singapore Bachelor of Law (Hons) from the National University of Singapore Working experience and occupations for the past 10 years and principal commitments Working experience and occupation during the last 10 years Practising lawyer, senior partner of Lee Bon Leong & Co. Principal Commitments (other than directorships) Present Chairman of the Home Detention Advisory Committee Chairman of the Board of Visitors for SCDF & SPF Detention Barracks (DB) Past Practising lawyer and consultant to Lee Bon Leong & Co Member of the Panel for the Disciplinary Committee of Enquiry Public Service Commission Vice-Chairman and Trustee of the Inmates’ Families Support Fund Member of the Singapore Board of Visiting Justices Member of the Institutional Discipline Advisory/Review Committee (IDAC/IDRC) Directorships (Present and Past 5 years) Present other than Megachem Limited Listed Asia Enterprises Holding Ltd Non-listed D S Lee Foundation Kien Lee Investment Pte Ltd King Tower Investment Pte Ltd Li Lee Investment Pte Ltd Rectron Investments Pte Ltd Sing Hup Leong Investment Pte Ltd Solid Gold Pte Ltd Past 5 years, listed and non-listed Listed AnnAik Limited Shareholdings (direct and deemed) in the Company (as at 21 January 2024) 100,000 Familial relationship with any director and/or substantial shareholder of the Company or of any of its principal subsidiaries Nil Conflict of interest (including any competing business) Nil MEGACHEM LIMITED ANNUAL REPORT 2023 19 BOARD OF DIRECTORS
MR SIDNEY CHEW CHOON TEE,AGE 63 Managing Director Date of first appointment as a Director: 28 April 1989 Date of last re-election as a Director: 18 April 2022 Length of service as a Director: 34 years and 10 months Country of principal residence: Singapore Board’s comments on the appointment Not applicable, Mr Sidney Chew Choon Tee is not subject to re-election. Board committee memberships Chairman of Executive Committee Member of Nominating Committee Academic and professional qualifications Bachelor of Science in Chemistry (Hons) Bachelor of Arts, majoring in Business Administration Working experience and occupations for the past 10 years and principal commitments Working experience and occupation during last 10 years Executive Director of Megachem Limited Principal Commitments (other than directorships) Present and Past Nil Directorships (Present and Past 5 years) Present other than Megachem Limited Listed Megachem (Thailand) Public Company Limited Non-listed Megachem Manufacturing Pte Ltd Megachem Raya Pte Ltd Megachem (Shanghai) Pte Ltd C.N. Chemicals Sdn. Bhd. P.T. Mega Kemiraya Megachem Plus Limited Megachem Phils., Inc Megachem International Trading (Shanghai) Co., Ltd Megachem (UK) Ltd Megachem Middle East FZE Megachem Vietnam Company Limited Megachem Specialty Chemicals (I) Private Limited Megachem Australia Pty Ltd Past 5 years, listed and non-listed Nil Shareholdings (direct and deemed) in the Company (as at 8 March 2024) 47,894,012 Familial relationship with any director and/or substantial shareholder of the Company or of any of its principal subsidiaries Ms Liau Bin Bin who is the spouse of Mr Sidney Chew Choon Tee is an Executive Director of C.N Chemicals Sdn Bhd, a wholly-owned subsidiary of Megachem Limited Conflict of interest (including any competing business) Nil By virtue of section 7 of the Companies Act, 1967, Mr Sidney Chew Choon Tee, who by virtue of his interest of not less than 20% shareholding interest in the Company, is deemed to have an interest in the shares held by the Company in all the related corporations of the Company. MEGACHEM LIMITED ANNUAL REPORT 2023 20 BOARD OF DIRECTORS
MR CHAN KAM LOON,AGE 63 Independent Director Date of first appointment as a Director: 28 September 2007 Date of last re-election as a Director: 18 April 2022 Length of service as a Director: 16 years and 5 months Country of principal residence: Singapore Board’s comments on the appointment Not applicable, Mr Chan Kam Loon will retire at the Company’s forthcoming annual general meeting. Board committee memberships Chairman of Audit Committee Member of Nominating Committee Member of Remuneration Committee Academic and professional qualifications Bachelor of Accountancy (Hons) from the London School of Economics Member of the Institute of Chartered Accountants in England and Wales Working experience and occupations for the past 10 years and principal commitments Working experience and occupation during the last 10 years Nil Principal Commitments (other than directorships) Present and Past Nil Directorships (Present and Past 5 years) Present other than Megachem Limited Listed Jiutian Chemical Group Limited Uni-Asia Group Limited Alpha DX Group Limited Southern Packaging Group Limited Non-listed Nil Past 5 years Listed OIO Holdings Limited Hupsteel Limited Sarine Technologies Limited Tee International Limited Non-listed 3 Peaks Capital Private Limited Shareholdings (direct and deemed) in the Company (as at 21 January 2024) Nil Familial relationship with any director and/or substantial shareholder of the Company or of any of its principal subsidiaries Nil Conflict of interest (including any competing business) Nil MEGACHEM LIMITED ANNUAL REPORT 2023 21 BOARD OF DIRECTORS
DR TAY KIN BEE,AGE 69 Independent Director Date of first appointment as a Director: 1 July 2013 Date of last re-election as a Director: 16 April 2021 Length of service as a Director: 10 years and 7 months Country of principal residence: Singapore Board’s comments on the appointment Not applicable, Dr Tay Kin Bee will retire at the Company’s forthcoming annual general meeting. Board committee memberships Chairman of Remuneration Committee Member of Audit Committee Academic and professional qualifications Doctor of Business Administration degree Master’s Degree in Accounting and Finance Bachelor’s Degree in Mechanical Engineering (1st Class Hons) SMU-SID Executive Diploma in Directorship Working experience and occupations for the past 10 years and principal commitments Working experience and occupation during the last 10 years Managing Director and CEO of a specialty chemical distribution company Principal Commitments (other than directorships) Present Executive Director of a private equity asset management company Past Managing Director and CEO of a specialty chemical distribution company Chairman of the Singapore Chemical Industry Council Deputy Chairman of the Chemical Standards Committee (Singapore Standards Council) Governing Board Member of the Workplace, Safety and Health Institute Taskforce Chairman for Globally Harmonized System of Classification and Labelling of Chemicals (Ministry of Manpower) Directorships (Present and Past 5 years) Present other than Megachem Limited Listed Nil Non-listed Riverside Asia Partners Pte Ltd Riverside Asia Pacific Fund II Pte Ltd Past 5 years, listed and non-listed Listed Chemical Industries (Far East) Limited Non-listed SPCI Pte Ltd DCM Asia Pte Ltd Shareholdings (direct and deemed) in the Company (as at 21 January 2024) Nil Familial relationship with any director and/or substantial shareholder of the Company or of any of its principal subsidiaries Nil Conflict of interest (including any competing business) Nil MEGACHEM LIMITED ANNUAL REPORT 2023 22 BOARD OF DIRECTORS
MR YASUTAKA KAWAMURA,AGE 53 Non-Executive and Non-Independent Director Date of first appointment as a Director: 1 July 2020 Date of last re-election as a Director: 19 April 2023 Length of service as a Director: 3 year 9 months Country of principal residence: Japan Board’s comments on the appointment Not applicable, Mr Yasutaka Kawamura is not subject to re-election. Board committee memberships Nil Academic and professional qualifications Master of Business Administration Bachelor of Economics Working experience and occupations for the past 10 years and principal commitments Working experience and occupation during the last 10 years Vice President of Chori (China) Co., Ltd Department Manager of Corporate Planning division in Chori Co., Ltd. Principal Commitments (other than directorships) Present Department Manager of Corporate Planning division in Chori Co., Ltd with experiences in corporate actions, accounting, financing, credit and legal matters. Past Key positions in finance, accounting and corporate planning within Chori Co., Ltd Directorships (Present and Past 5 years) Present other than Megachem Limited Listed Nil Non-listed Chori Europe Gmbh Past 5 years, listed and non-listed Listed Nil Non-listed Chori Co., (Hong Kong) Ltd Chori (Tianjin) Co., Ltd Chori (Dalian) Trading Co., Ltd Chori (Dalian) Commercial Import Export Co., Ltd Shareholdings (direct and deemed) in the Company (as at 21 January 2024) Nil Familial relationship with any director and/or substantial shareholder of the Company or of any of its principal subsidiaries An employee and nominee of Chori Co., Ltd, a 29.99% shareholder of Megachem Limited Conflict of interest (including any competing business) Nil MEGACHEM LIMITED ANNUAL REPORT 2023 23 BOARD OF DIRECTORS
MR FRANCIS YAU THIAM HWA Chief Financial Officer Mr Francis Yau joined Megachem in 2000 as the General Manager of Megachem (Shanghai) Pte Ltd and Megachem International Trading (Shanghai) Co. Ltd prior to his appointment as the Group’s Financial Controller in 2001. He was promoted to the position of Chief Financial Officer on 1 January 2007. Mr Yau takes responsibility for all financial matters including financial and treasury planning, financial risk management and investor relations. He had several years of corporate banking experience prior to joining Megachem. He holds a bachelor degree in Business Administration from the National University of Singapore, majoring in finance and is also a member of the Institute of Singapore Chartered Accountants. He currently serves as an independent director in one company listed on SGX. MS KWOK HWEE PENG Group Finance Manager Ms Kwok Hwee Peng joined Megachem as Group Accountant in 2002 and was promoted to the position of Group Finance Manager in 2008. She is responsible for the Group’s financial reporting and is also the Company Secretary. She has several years of experience in accounting and audit with PricewaterhouseCoopers prior to joining Megachem. She holds a Bachelor of Accountancy degree from the Nanyang Technological University and is also a member of the Institute of Singapore Chartered Accountants. MEGACHEM LIMITED ANNUAL REPORT 2023 24 SENIOR MANAGEMENT
At Megachem, our people are our greatest assets hence is at the heart of everything we do.We believe in the continuous investment and development of our people to realize their full potential to help the organization achieve excellence in our business results.The People Developer accolade awarded in past years is testimony to this longstanding commitment and belief that investment in people will thrust the organization towards the pinnacle of excellence in our relationship with our partners, customers and suppliers. In pursuit of People Excellence, we adopt a holistic approach to human capital development. REWARDS & BENEFITS Megachem considers the competitive market place, relative value of each position to the Company as well as among similar jobs, performance of individual employees, qualifications and relevant work experience in deciding how much an individual is paid.The Company reviews its compensation and benefits program regularly to ensure it is on par with the market. The Company believes in providing targeted incentives and rewards to employees, consistent with their performance. WELFARE AND WELL-BEING We are committed to creating and sustaining a working environment supportive of work life balance for all employees as they are respected partners of the business. The Company conducts various programs to foster welfare and well-being among colleagues, to improve overall health of employees and to achieve work-life harmony. In so doing, a visible team of committed, productive and motivated employees is highly energized to realize the corporate vision, mission, values and culture. LEARNING AND DEVELOPMENT We place people at the core of our human resource (“HR”) strategy and hold strong belief in nurturing of our employees to achieve excellent business results and attain high level of competency.The Company’s HR policy is one that promotes the availability of opportunities for people to be trained on a continuing basis. Although “People Developer”, a certification awarded by Enterprise Singapore to companies which have achieved excellence in human capital development had ceased in 2020, we continued to adopt its principle and guidelines for a total approach to attracting, managing and engaging employees for high performance and aims to bring the best out of our people. CAREER & LEADERSHIP DEVELOPMENT Our performance appraisal process has a development component that encourages employees to plan development that will help increase their performance and growth in their personal and professional development. In addition, to ensure a rewarding and fulfilling career at Megachem, the Company has in place a Mentorship Program where mentees are guided and coached by mentors in professional developmental and personal growth. HIGHER LEARNING EDUCATION SUPPORT The Higher Learning Education (“HLE”) program provides financial assistance and professional education and training (“PET”) to eligible employees who choose to further their professional education to enhance their knowledge and skills.This program provides reimbursement of eligible expenses for approved Diploma/Degree/ Master/PhD certification programs related to employee’s current or future job responsibilities. STUDENTS AND GRADUATES Megachem welcomes Interns/ Attachment students to embark on an exciting learning journey with challenging assignments and projects. Fresh graduates are strongly encouraged to apply and join the Company as Management Trainees in their first step towards building a promising career. MEGACHEM LIMITED ANNUAL REPORT 2023 25 OUR HUMAN CAPITAL
AT MEGACHEM,WE ARE CONSTANTLY PURSUING HIGHER STANDARDS OF BUSINESS EXCELLENCE. OUR STRING OF ACHIEVEMENTS AND AWARDS GARNERED OVER THE YEARS ATTEST TO OUR CUSTOMER-FOCUSED CORPORATE VALUES AND QUALITY STANDARDS. MEGACHEM LIMITED ANNUAL REPORT 2023 26 OUR ACHIEVEMENT
BOARD OF DIRECTORS Lee Bon Leong (Independent and Non-Executive Chairman) Sidney Chew Choon Tee (Managing Director) Chan Kam Loon (Independent Director) Tay Kin Bee (Independent Director) Yasutaka Kawamura (Non-Executive and Non-Independent Director) AUDIT COMMITTEE Chan Kam Loon (Chairman) Lee Bon Leong Tay Kin Bee REMUNERATION COMMITTEE Tay Kin Bee (Chairman) Lee Bon Leong Chan Kam Loon NOMINATING COMMITTEE Lee Bon Leong (Chairman) Chan Kam Loon Sidney Chew Choon Tee EXECUTIVE COMMITTEE Sidney Chew Choon Tee (Chairman) Francis Yau Thiam Hwa Kwok Hwee Peng COMPANY SECRETARIES Kwok Hwee Peng Hon Wei Ling REGISTERED OFFICE 11 Tuas Link 1 Singapore 638588 Tel: (65) 6933 9999 Fax: (65) 6863 2818 Website: www.megachem.com SHARE REGISTRAR AND SHARE TRANSFER OFFICE Tricor Barbinder Share Registration Services (a division of Tricor Singapore Pte Ltd) 9 Raffles Place, Republic Plaza, #26-01, Singapore 048619 Tel: (65) 6236 3333 EXTERNAL AUDITOR RSM SG Assurance LLP 8 Wilkie Road #03-08 Wilkie Edge Singapore 228095 Partner-in-charge: Tan Beng Teck (with effect from financial year ended 31 December 2022) INTERNAL AUDITOR Baker Tilly Consultancy (Singapore) Pte Ltd 600 North Bridge Road #05-01 Parkview Square Singapore 188778 PRINCIPAL BANKERS Citibank, N.A. HSBC Oversea-Chinese Banking Corporation Limited Standard Chartered Bank United Overseas Bank Limited CONTINUING SPONSOR SAC Capital Private Limited 1 Robinson Road #21-00 AIA Tower Singapore 048542 Tel: (65) 6232 3210 INVESTOR RELATIONS ADVISOR Citigate Dewe Rogerson Singapore Pte Ltd 158 Cecil Street #05-01 Singapore 069545 Tel: (65) 6534 5122 Email: Megachem@ citigatedewerogerson.com INVESTOR RELATIONS CONTACT Citigate Dewe Rogerson Singapore Pte Ltd Dolores Phua/Teo Zheng Long Email: Megachem@ citigatedewerogerson.com Megachem Limited Francis Yau Email: fsyau@sg.megachem.com INVESTOR RELATIONS WEBSITE www.megachem.com www.shareinvestor.com PERSONAL DATA PROTECTION OFFICER CONTACT Megachem Limited Woo Tze Yung Email: tywoo@sg.megachem.com WHISTLE BLOWING CONTACT Tel: (65) 6863 9285 Email: auditcom@sg.megachem.com MEGACHEM LIMITED ANNUAL REPORT 2023 27 CORPORATE INFORMATION
MEGACHEM LIMITED MEGACHEM MANUFACTURING PTE LTD MEGACHEM RAYA PTE LTD MEGACHEM (SHANGHAI) PTE LTD 11 Tuas Link 1, Singapore 638588 Tel: +65 6933 9999 Fax: +65 6863 2818 E-mail: enquiry@sg.megachem.com Website: www.megachem.com C.N. CHEMICALS SDN BHD No. 9, (LOT 72791) Jalan SKI 1/KU7 Kawasan Industri Hi-Tech Sungai Kapar Indah, Mukim Kapar 42200 Klang, Selangor, Malaysia Tel: +60 33081 2399 Fax: +60 33081 2599 E-mail: enquiry@my.megachem.com P.T. MEGA KEMIRAYA Wisma 77. 6th Floor Jl S. Parman Kav. 77 Slipi Jakarta Barati, 11410 Indonesia Tel: +62 21 536 3189 Fax: +62 21 535 8987 E-mail: enquiry@id.megachem.com MEGACHEM (THAILAND) PUBLIC COMPANY LIMITED 25 Soi Chalongkrung 31, Ladkrabang Industrial Estate Soi G1/9, Lamplathew, Ladkrabang, Bangkok 10520 Thailand Tel: +66 2 739 6333 Fax: +66 2 739 6332 E-mail: enquiry@megachem.com.th MEGACHEM PLUS LIMITED 278/40 Moo.10 Bang Pla, Bangplee, Samutprakarn 10540, Thailand Tel: +66 2 752 5145-7 Fax: +66 2 752 5148 E-mail: enquiry@megachem.co.th MEGACHEM PHILS INC Greenlee Compound 143 M.L Quezon Extension Street Brgy Manggahan, Pasig City Philippines,1611 Tel: +632 7914-0837 E-mail: enquiry@ph.megachem.com MEGACHEM INTERNATIONAL TRADING (SHANGHAI) CO., LTD 988 Dingxi Road, Unit 1502,Yintong Building, Shanghai, China 200050 Tel: +86 21 5237 5028 Fax: +86 21 5237 5025 E-mail: enquirysh@cn.megachem.com MEGACHEM INTERNATIONAL TRADING (BEIJING) CO., LTD Room 2212, Building 7, First City Mingdundao External Guangqumenwai Street, Dongcheng District Beijing, China 100022 Tel: +86 10 8751 2969 Fax: +86 10 8751 3382 E-mail: enquirybj@cn.megachem.com MEGACHEM (UK) LTD Castlegate Business Park, Caldicot, Monmouthshire, NP26 5AD, United Kingdom Tel: +44 0 1291 422 747 Fax: +44 0 1291 422 479 E-mail: enquiry@uk.megachem.com MEGACHEM MIDDLE EAST FZE LIU 10 Unit AB03 South Zone, Jebel Ali Free Zone, Dubai, United Arab Emirates Tel: +971 4 866 5458, 286 6143 Fax: + 971 4 285 1615 E-mail: enquiry@uae.megachem.com MEGACHEM VIETNAM COMPANY LIMITED Unit 703, 7th Floor 45 Dinh Tien Hoang Street, Ben Nghe Ward District 1, Ho Chi Minh City,Vietnam Tel: +84 28 3910 6638 Fax: +84 28 3910 6636 E-mail: enquiry@vn.megachem.com MEGACHEM SPECIALTY CHEMICALS (I) PRIVATE LIMITED Fairmount, 702 & 703, Plot no 4 and 6, Sanpada, Palm Beach Road, Sector 17, Navi Mumbai, Maharashtra 400705, India Tel: +91 22 4026 0957, 4026 0958 Fax: +91 22 4026 0907 E-mail: info@in.megachem.com MG CHEMICALS (AUSTRALIA) PTY LTD Suite 2, 34 Edgewater Boulevard Marybymong Victoria Australia 3032 Tel: +61 03 9326 2882 Fax: +61 03 9375 7886 E-mail: enquiry@au.megachem.com MEGACHEM (MYANMAR) LIMITED No.42:/302(B), Set Hmu 1st Road, Set Hmu Zone 1, Shwe Pyi Thar Township,Yangon, Myanmar 11411 Tel: + 951 860 4030 E-mail: teresa@megachemmyanmar. com MEGA FUJI GRAPHITE LIMITED 25 Soi Chalongkrung 31, Ladkrabang Industrial Estate Soi G1/9, Lamplathew, Ladkrabang, Bangkok 10520,Thailand Tel: +66 2 739 6333 Fax: +66 2 739 6332 Email: enquiry@megafujigraphite.co.th GREEN LEAF CHEMICAL CO., LIMITED 15/8 – 15/9 Pattana Chonnabot 3 Road, Khlongsongtonnun, Lat Krabang, Bangkok 10520,Thailand Tel: +66 2 045 2935, 045 2940-2, 138, 9642 Fax: +66 2 138 9624 E-mail: info@greenleafchemical.net MEGACHEM LIMITED ANNUAL REPORT 2023 28 GLOBAL OFFICE CONTACT
2019 2.88 2020 3.85 2021 5.82 2022 4.41 2023 (4.43) EARNINGS/(LOSS) PER SHARE (CENTS) 2019 7.0 2020 7.7 2021 11.1 2022 10.5 2023 (1.9) EBITDA (S$’MIL) 2019 4.0 2020 5.3 2021 8.0 2022 6.1 2023 (5.8) PROFIT/(LOSS) AFTER TAX (S$’MIL) 2019 113.8 2020 105.2 2021 138.9 2022 143.7 2023 123.0 SALES (S$’MIL) 2023 (adj)* 1.9 *Adjusted for a one-off impact from a fire incident MEGACHEM LIMITED ANNUAL REPORT 2023 29 FINANCIAL HIGHLIGHTS
INCOME STATEMENT 2019 2020 2021 2022 2023 Sales (S$’mil) 113.8 105.2 138.9 143.7 123.0 Sales Growth (%) (3.5%) (7.5%) 32.0% 3.5% (14.4%) Profit/(loss) After Tax (S$’mil) 4.0 5.3 8.0 6.1 (5.8) Profit/(loss) After Tax (adj) (S$’mil)(1) 1.9 Profit/(loss) After Tax Growth (%) (6.8%) 32.0% 52.0% (24.1%) NM Profit/(loss) After Tax Margin (%) 3.5% 5.0% 5.8% 4.2% (4.7%) EBITDA (S$’mil) 7.0 7.7 11.1 10.5 (1.9) Earnings/(loss) per share (cents) 2.88 3.85 5.82 4.41 (4.43) Weighted Average Number of Ordinary Shares (mil) 133.3 133.3 133.3 133.3 133.3 ROE (%) 7.7% 9.8% 13.6% 10.0% (11.8%) HALF-YEAR BREAKDOWN 2019 2020 2021 2022 2023 Sales for first half (S$’mil) 55.8 52.0 65.9 75.2 60.7 % Growth 1H vs 1H (5.5%) (6.7%) 26.7% 14.1% (19.3%) Sales for second half (S$’mil) 58.0 53.2 73.0 68.5 62.3 % Growth 2H vs 2H (1.4%) (8.3%) 37.1% (6.1%) (9.1%) Profit After Tax for first half (S$’mil) 2.0 2.8 3.8 4.5 0.9 % Growth 1H vs 1H (16.0%) 39.9% 34.0% 18.0% (79.1%) Profit/(loss) After Tax for second half (S$’mil) 2.0 2.4 4.2 1.6 (6.7) % Growth 2H vs 2H 4.9% 24.0% 72.7% (61.8%) NM FINANCIAL POSITION 2019 2020 2021 2022 2023 Total Assets (S$’mil) 86.2 91.3 110.9 117.1 100.2 Shareholders Equity (S$’mil) 49.6 52.4 57.3 58.6 50.0 Net Asset/Share (cents) 37.24 39.33 42.95 43.96 37.48 Borrowings (S$’mil) 18.4 19.3 28.9 36.4 28.5 Gearing ratio (times) 0.37 0.37 0.51 0.62 0.57 Net gearing ratio (times) 0.07 0.06 0.30 0.42 0.3 Cash (S$’mil) 14.9 16.2 11.5 11.9 13.6 Current ratio (times) 2.2 2.2 1.8 1.8 1.7 DIVIDEND 2019 2020 2021 2022 2023 Net Dividend/Share (cents) 1.5 1.5 2.0 2.0 0.0 Net Dividend Payout (%) 51.9% 39.0% 34.4% 45.4% 0.0 Net Dividend Yield (%)(2) 5.0% 4.5% 4.8% 3.9% 0.0 Notes: (1) Adjusted for a one-off impact from a fire incident (2) Dividend yield based on closing price as at 31 Dec NM: not meaningful MEGACHEM LIMITED ANNUAL REPORT 2023 30 FINANCIAL HIGHLIGHTS
GLOBAL MARKETS INDUSTRY COVERAGE 58% 33% 31% 59% 8% 13% 11% 8% 0% 23% 28% 0% 13% 22% 20% 13% 4% 9% 10% 3% 9% 9% 8% 0% 8% 0% FY 2021 Performance Coatings & Polymers Advanced Polymer Composites Surface Technology Biotech Resource, Oil & Gas ASEAN N Asia America Europe S Asia Middle east Australia Africa FY 2022 FY 2023 FY 2022 FY 2023 MEGACHEM LIMITED ANNUAL REPORT 2023 31 FINANCIAL HIGHLIGHTS
PROFITABILITY REVIEW Sales Variance Fav/(Unfav) Variance Fav/(Unfav) H2 2023 H1 2023 H2 2023 vs H1 2023 H2 2022 H2 2023 vs H2 2022 S$’000 S$’000 S$’000 % S$’000 S$’000 % ASEAN 36,611 35,615 996 2.8 37,388 (777) (2.1) Europe 7,396 8,308 (912) (11.0) 8,953 (1,557) (17.4) North Asia 5,423 4,892 531 10.9 5,974 (551) (9.2) Australia 5,393 4,299 1,094 25.4 7,835 (2,442) (31.2) Middle East 5,133 5,426 (293) (5.4) 5,749 (616) (10.7) South Asia 1,987 1,833 154 8.4 1,989 (2) (0.1) America 117 95 22 23.2 104 13 12.5 Africa 264 217 47 21.7 555 (291) (52.4) Total 62,324 60,685 1,639 2.7 68,547 (6,223) (9.1) FY 2023 FY 2022 Variance Fav/(Unfav) S$’000 % S$’000 % S$’000 % ASEAN 72,226 58.7 83,080 57.8 (10,854) (13.1) Europe 15,704 12.7 18,348 12.8 (2,644) (14.4) Middle East 10,559 8.6 12,227 8.5 (1,668) (13.6) North Asia 10,316 8.4 11,426 7.9 (1,110) (9.7) Australia 9,692 7.9 12,019 8.4 (2,327) (19.4) South Asia 3,820 3.1 5,680 3.9 (1,860) (32.7) America 212 0.2 231 0.2 (19) (8.2) Africa 480 0.4 710 0.5 (230) (32.4) Total 123,009 100.0 143,721 100.0 (20,712) (14.4) MEGACHEM LIMITED ANNUAL REPORT 2023 32 OPERATING AND FINANCIAL REVIEW
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