1

FY2001 INTERIM RESULTS

August 15, 2001

2

AGENDA

Company Update Financial Performance Q&A

3

COMPANY UPDATE

By Henry Lim

President & CEO

4

MISSION

To be the one of the top knowledge-based, value-added distributors of electronics and IT solutions in the Asia Pacific region;

To be a leading Asian-based creator of innovative proprietary technology products and solutions

5

CORE COMPETENCIES

Peripherals and Software

Electronic Components

Data Networking/Service Offerings/

Design & Development

StrategicTechnologies

6

REGIONAL PRESENCE

China

HK

VietnamThailand

MalaysiaS’poreIndonesia

India

Australia

Philippines

Korea

Taiwan

7

ACHIEVEMENTS (Jan - July 2001) Corporate

– Strengthening Group Dynamics• Acquisition of subsidiaries in Vietnam & Australia

Business– New Strategic Partnerships– Four new distributorships secured:

• Infineon • Western Digital• Transpoint Technology• Stream Machine Inc

– Expected to contribute >$80 million to Group revenue in FY2001

8

ACHIEVEMENTS(Jan - July 2001)

Geographic Expansion : China– Achieva Technology China– 51% owned by Achieva – 49% owned by HK-based Interlead Corporation– Paid up capital : HK$10 million– Distribution and service centre for IT products– Distribution network covering 13 cities and 28

retail outlets in PRC– Expected to contribute S$40 million to Group

revenue in 2H

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PRESENCE IN PRC

• BEIJINGBEIJING

• SHANGHAISHANGHAI• NANJINGNANJING

• WUHANWUHAN

• GUANGZHOU (HQ)GUANGZHOU (HQ)

• SHENZHENSHENZHEN

• CHONGQINGCHONGQING• CHENGDUCHENGDU

• XI’ANXI’AN

• SHENYANGSHENYANG

• JINANJINAN

• ZHENGZHOUZHENGZHOU

• HANGZHOUHANGZHOU

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ACHIEVEMENTS(Jan - July 2001)

Technology– IP and Patents

• HDD connectivity• Notebook batteries• Expect to file 7 patents on NanoStorage this

year

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ACHIEVEMENTS(Jan - July 2001)

Technology– NanoStorage

• Working prototype of controller device on schedule• Received engineering sample • Expect to demonstrate complete working engineering

sample by year-end• Nanochip currently raising funds to bring the prototype

into production• Received in-principle approval for government grant for

R&D support

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ACHIEVEMENTS(Jan - July 2001)

Talent– ESOS– Founder Shares Award Scheme

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MARKET OUTLOOK - THE BAD NEWSVisibility for electronics industry still foggy

– Singapore’s electronics output declined 26% in Q2 2001

Semiconductor industry continues to be affected by inventory overhang

Major global electronics players are reporting losses and cutbacks

Contract manufacturing not expected to recover soon

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MARKET OUTLOOK - THE GOOD NEWS

PC industry in Asia-Pacific showing signs of initial recovery – Gartner: Asia-Pacific registered a 12.5% y-o-y

growth in PC shipments in 2001Q2• Gartner Dataquest, August 2001

Contract manufacturing services expected to recover and hit US$231 billion by 2005 - up 124% from US$103 billion in 2000

• IDC July 2001

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MARKET OUTLOOK - THE GOOD NEWS

Consolidation of electronics players => new opportunities for stronger players

New emerging markets with strong growth potential :– China

• 1H 2001 growth : 8% - full year growth expected to be maintained

• WTO entry• Beijing Olympics

– India• IT hub of South Asia

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GOING FORWARD

To ride out the storm with prudent management and strategic focus on niche competencies and markets

To expand strategically in high-growth emerging economies such as China

To continue to scale up the value chain to provide a full range of knowledge-based value-added services and solutions

To leverage on existing knowledge base, wide network of customers and vast portfolio of products to develop and deliver new offerings to the market

To grow IP and proprietary products/solutions portfolio in high-growth leading-edge technology sectors

To build up professional talent to strengthen management and technological expertise

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FINANCIAL PERFORMANCE

By Allan Yong

Chief Financial Officer

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GROUP TURNOVER

0

50

100

150

200

250

FY2000-1H FY2001-1H

S$million

Up 51%

160

242

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TURNOVER BY PRODUCT

FY2000 –1H

86%

1.00%13.00%

S$’000

83%

15.70% 1.30%

PC peripherals & softwareElectronic componentsData network

FY2001-1H

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TURNOVER BY MARKET

48 46.649.256.5

45.6

55

17.610.3

0.1

58

08.6

06.7

0

10

20

30

40

50

60

70

FY2000-1H FY2001-1H

S'pore Malaysia Australia VietnamPRC Indonesia Philippines

S$million

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GROUP PBT

3

3.5

4

4.5

5

5.5

6

6.5

FY2000-1H FY2001-1H

S$million

6.2

0.9

5.6

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PBT BY PRODUCT

-1000

-500

0

500

1000

1500

2000

2500

3000

3500

4000

4500

FY00-1H FY01-1H

PC peripheralsand software

electroniccomponents

Data networkpdts

Strategicinvestments

Others

S$’000

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NET PROFIT

1,000

2,000

3,000

4,000

5,000

6,000

FY2000-1H FY2001-1H

S$’000

3,892 3,819

4,382

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FINANCIAL HIGHLIGHTS

Strong turnover growthStable net profit despite margin squeezeGrowth in profit contribution from electronics

componentsStrategic investments in NanoStorage of $0.8M Strong balance sheet - cash position – up from

$22M to $27M Inventory down to $31MTrade receivables –up from $38M to $56M

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EPS

0

0.2

0.4

0.6

0.8

1

1.2

FY00-1H FY01-1H

cents

1.190.92

1.06

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NTA PER SHARE

10.58

12.44

9.5

10

10.5

11

11.5

12

12.5

FY00-1H FY01-1H

cents

Up 17.6%

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FINANCIAL OUTLOOK

Challenging conditions for 1H and outlook for 2H uncertain

Revenues expected to continue growing: Estimated total impact >S$120m for FY2001

Profit margins continue to be pressured with increasing competition and electronics slowdown

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Q&A