01CORPORATE PROFILE &MISSION STATEMENT

02CHAIRMAN’S MESSAGE

04OPERATIONS REVIEW

06AWARDS AND

CERTIFICATIONS

07GROUP STRUCTURE

08BOARD OF DIRECTORS

11KEY EXECUTIVES

12OUR NETWORK

13CORPORATE MILESTONE

15CORPORATE

GOVERNANCE REPORT

28FINANCIAL STATEMENTS

92ADDITIONAL INFORMATION

94STATISTICS OF

SHAREHOLDINGS

96NOTICE OF ANNUAL GENERAL

MEETING

PROXY FORM

CONTENTS

BOARD OF DIRECTORSDr John Chen Seow Phun, ChairmanChing Heng Yang, Vice ChairmanTam WaiHo Nee KitHew Lien LeeTan Yew BengFoo Say Tun

EXECUTIVE DIRECTORSChing Heng YangTam WaiHo Nee KitHew Lien Lee

NON-EXECUTIVE DIRECTORSDr John Chen Seow PhunTan Yew BengFoo Say Tun

AUDIT COMMITTEEDr John Chen Seow Phun, ChairmanTan Yew BengFoo Say Tun

NOMINATING COMMITTEEFoo Say Tun, ChairmanDr John Chen Seow PhunTan Yew Beng

REMUNERATION COMMITTEETan Yew Beng, ChairmanDr John Chen Seow PhunFoo Say Tun

COMPANY SECRETARYTeo Meng KeongChan Lai Yin

REGISTERED OFFICE8 Tuas Drive 1Singapore 638675Tel : (65) 6578 7338Fax: (65) 6578 7347Website: www.fuyucorp.com

SHARE REGISTRARBoardroom Corporate & Advisory Services Pte. Ltd.50 Raffles Place#32-01 Singapore Land TowerSingapore 048623

EXTERNAL AUDITORSKPMG LLP16 Raffles Quay#22-00 Hong Leong BuildingSingapore 048581

Audit Partner: Kum Chew FoongSince financial year 2015

BANKERSDBS Bank LtdMalayan Banking Berhad

CORPORATE INFORMATION

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FU YU CORPO

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Established in 1978 as a partnership fabricating injection moulds and manufacturing plastic injection parts, Fu Yu has since grown to become a listed corporation with global presence. We are now one of the largest manufacturers and suppliers of high-precision injection moulds and plastic parts in Asia. Currently, we have 10 manufacturing plants in Singapore, Malaysia and China.

Taking a vertically integrated approach towards greater profitability, our operations make a complete range from design to fabrication to assembly, and include secondary processes such as silk screening, pad printing, ultrasonic welding, heatstaking and spray painting. The markets we serve include the information technology, telecommunications, automotive, medical, electronic and electrical appliance and water filtration in home appliance sectors.

MISSION STATEMENTFu Yu aims to be the preferred global partner in engineering plastic products, from design to full assembly. We will deliver our vision through: embracing technology and creativity; providing satisfaction to our customers; continuous learning for our people; and maximising returns to our shareholders.

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DEAR SHAREHOLDERS,

FY2015 proved to be a challenging but fulfilling year for Fu Yu. Just like many others in the industry, the Group was affected by continuing downward price pressure and rising operation costs. Nevertheless, amidst these obstacles, the Group built on the momentum generated in 2014, and managed to perform well, with a 48.4% increase in net profit to S$16.7 million, in spite of a 12.6% dip in revenue to S$222.5 million.

The positive performance was the result of strategic moves initiated by the Group since 2013. Through firm cost management, a strong focus to drive productivity, and ongoing efforts to right-size and consolidate the operations at our various plants, our gross profit was pushed up by 14.2% to S$35.5 million. Gross profit margin improved 3.7 percentage points to 15.9%.

OPERATIONAL HIGHLIGHTS These results clearly validated the strategic measures that the Group undertook. In 2015, we continued to improve efficiency and lower product rejection levels, thus minimising machinery down-time and materials wastage. As always, this was achieved by carefully getting to the root of the rejection issues and addressing them.

Overall productivity and efficiency of our plants was improved, by uncovering their potential profitability, with an emphasis on lean manufacturing. The Group’s investments in new and more advanced machinery to either semi-automate or fully-automate various processes also paid off. Headcount has also been managed tightly by simplifying the production processes. This left us DR JOHN CHEN SEOW PHUN

CHAIRMAN’SMESSAGE

FY2015 PROVED TO BE A CHALLENGING BUT FULFILLING YEAR FOR FU YU.

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with a lean roster of staff, but kept at an optimal level to support our operations.

The Group continues to maintain tight control over inventory by actively monitoring inventory levels to ensure they are kept in line with customers’ orders. The implementation of just-in-time inventory management and tighter production planning control further reduced inventory holding.

Operations in Malaysia remain focused on our core businesses after the assets disposal by our major subsidiary in Malaysia, Classic Advantage Sdn Bhd (“Classic Advantage”), in 2013. Despite the fact that the Malaysia segment saw a decrease in revenue as a result of the right-sizing exercise, both of the Malaysia subsidiaries achieved higher profits and better profitability in FY2015.

In China, the Group’s performance for FY2015 was not as positive as expected. This was largely due to decrease in sales in two of the China subsidiaries. We will continue to look at ways to increase revenue, raise efficiency and tighten costs in all our China plants in order to yield a better result.

Fu Yu Corporation Ltd, our headquarters in Singapore, recorded significantly higher revenues, boosted by sales of green and medical products – strong drivers that we will continue to build on. Like our operations in Malaysia and China, we will strive to source for projects that deliver higher profit margins, and continue to improve the productivity and efficiency of our Singapore plants.

OUTLOOK Looking ahead, we expect industry competition to intensify amidst growing uncertainty in the world’s economy. The challenge is for us to continuously cement our foundation to support sustainable growth.

With our successful efforts to consolidate and streamline operations, we are now in a stronger position to build on our core business – manufacturing and sub-assembly of precision plastic parts and components, as well as fabrication of precision moulds and dies. We will focus on new products that will provide the sustainable growth for the next 5 to 10 years. This includes automobile, medical, and green products such as air, water and solar products.

It is important that we continue to stay close to our customers, keep our eyes open, ears to the ground and step up our sales and marketing efforts to attract more orders. Our improved profitability in 2015 shows the Group is moving in the right direction and we will continue to upgrade our machinery for higher productivity and invest in talented and skilled staff to further improve the Group’s performance.

FY2015 DIVIDENDSI am glad to report that the Group has declared and paid dividends in 2015, comprising 0.25 cent per share paid on 16 September 2015 and another 0.25 cent per share paid on 8 December 2015. The Group has also proposed a final dividend for FY2015 of 1.0 cent per share, subject to shareholders’ approval at the AGM.

WORDS OF APPRECIATION To our board of directors, management team, staff and business associates, thank you for your continued support. I look forward to forging stronger camaraderie with all of you as we propel the Group forward together. To our shareholders, thank you for placing your trust in Fu Yu.

DR JOHN CHEN SEOW PHUNChairman

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REVENUEFor the year ended 31 December 2015 (FY2015), the Group recorded a 12.6% decline in revenue from S$254.4 million to S$222.5 million. While a majority of the decrease in revenue came from the China segment, the Malaysia segment also recorded a drop in revenue for the year 2015 as a result of decrease in orders and depreciation of the Malaysia Ringgit against the Singapore Dollar. The decrease in revenue in China and Malaysia segments was partially offset by the increase in revenue in Singapore segment.

GROSS PROFIT AND GROSS MARGIN Cost of sales decreased by S$36.4 million or 16.3% from S$223.4 million in FY2014 to S$187.0 million in FY2015. Other than decrease in revenue, right-sizing exercises that were carried out in some of the Group’s operations drove the cost of production down. In addition, fixed costs such as depreciation decreased as certain property, plant and equipment were fully depreciated during the year.

Gross profit for FY2015 increased by S$4.4 million or 14.2% from S$31.1 million in FY2014 to S$35.5 million in FY2015. Gross profit margin was 15.9% for FY2015 as compared to 12.2% in the last corresponding year.

The Group’s gross profit margin improvement in FY2015, despite the decrease in revenue, was partly attributed to better cost management and better utilisation of facilities by right-sizing some of its operations and carrying out lean manufacturing activities. Also contributing to the improved margin was the appreciation of US Dollar against Singapore Dollar, Malaysia Ringgit and Chinese Renminbi, which are the local currencies where the Group operates in. In addition, fixed costs such as depreciation has decreased, as certain property, plant and equipment were fully depreciated in FY2015.

OTHER INCOME The Group’s other income decreased by S$1.0 million from S$10.6 million in the last corresponding year to S$9.6 million in FY2015. The decrease was mainly due to decrease in government grants by S$1.6 million. This was mainly due to decrease in government grants received by a China subsidiary as most of the amounts granted has been received in the previous years. The

decrease in government grants was partially offset by a one-time gain on liquidation of a subsidiary in China of S$0.4 million recorded during the year.

For the year ended 31 December 2015, other operating income increased by S$0.9 million from S$1.5 million in the last corresponding year to S$2.4 million in current year under review. The increase was mainly attributed to no impairment loss on property, plant and equipment was recorded in current year under review, compared to a net impairment of property, plant and equipment of S$0.5 million in FY2014. In addition, the increase was partly contributed by the increase in foreign exchange gain by S$0.2 million from S$2.5 million in last corresponding year to S$2.7 million in current year under review.

The Group’s foreign exchange gain in the current year under review was resulted from the translation of receivables, cash, payables and borrowings denominated in foreign currencies to the functional currencies of the respective companies in the Group. The strengthening of the US Dollar against the Singapore Dollar, Malaysia Ringgit and Chinese Renminbi had contributed to the foreign exchange gain as the Group is at net US Dollar assets position.

FINANCE COSTS Finance costs decreased in the current year under review as compared to last year. This was due to full repayment of bank borrowings in Q1 2015.

PROFITABILITYThe Group’s share of profit of joint venture in FY2015 amounted to S$0.4 million as compared to share of loss of S$0.4 million in the last corresponding year. The improvement in profitability of the joint venture company was due to increase in its business activities and increase in foreign exchange gain recorded during the year.

Profit before income tax for the Group was recorded at S$18.4 million for FY2015 as compared to S$13.4 million for FY2014, an increase of S$5.0 million or 37.4%. The increase in profit before income tax was mainly attributed to (i) improvement in gross profit by S$4.4 million, (ii) nil impairment on property, plant and equipment in current year as compared to net impairment on property, plant and equipment of S$0.5 million and (iii) increase in foreign exchange gain by S$0.2 million in the current year.

Income tax expense was S$1.8 million and effective tax rate was 9.5% in the current year under review. The low

OPERATIONSREVIEW

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effective tax rate for the current year under review was mainly due to the recognition and utilisation of deferred tax assets not recognised in prior years. The impact of the recognition and utilisation of deferred tax assets was offset by the income tax expenses from the profit-making China subsidiaries, reclassification of withholding taxes from selling and administrative expenses to income tax expense of S$0.5 million and recognition of deferred tax liabilities by the holding company.

CASH POSITIONThe Group’s cash and cash equivalents (excluding cash deposits pledged) stood at S$99.9 million as at 31 December 2015, which is an increase of S$23.3 million (including effects of exchange rate fluctuations on cash held) from cash and cash equivalents as at 31 December 2014.

The increase in cash and cash equivalents was mainly attributed to net cash generated from operating activities of S$34.2 million, offset by payments for purchase of property, plant and equipment of S$6.3 million, cash distribution to shareholders through capital reduction of S$3.8 million, dividends payment to shareholders of the Company of S$3.8 million, and net repayment of short term borrowings and financial lease liabilities of S$1.4 million.

GEOGRAPHICAL SEGMENT REVIEWSINGAPORERevenue from the Group’s Singapore operations increased by S$2.2 million or 5.0% from S$42.8 million in FY2014 to S$45.0 million in FY2015. The increase was mainly due to an increase in demand for the moulding business, medical and green products in this segment. Singapore contributed 20.2% to the Group’s FY2015 revenue.

Excluding the dividend income of S$7.3 million from profitable Malaysia and China subsidiaries and interest income of S$0.2 million from China subsidiaries, FY2015 segment profit for Singapore segment would be S$9.0 million.

Profit recorded by this segment increased by S$6.4 million from S$2.6 million in the last corresponding year to S$9.0 million in the current year under review. This was attributed to increase in sale of better margin products, improvement in operational efficiency, better cost management and a decrease in depreciation charges as certain property, plant and equipment

were fully depreciated in the year under review. There was no impairment loss made for property, plant and equipment in FY2015 as compared to S$0.7 million impairment loss recorded in the last corresponding year. Appreciation of the US Dollar against Singapore Dollar had also contributed to the better profitability of the Singapore segment.

CHINAThe Group’s China segment recorded a significant revenue decrease of S$28.0 million or 17.0% from S$164.7 million in FY2014 to S$136.7 million in FY2015 due to decrease in sales order. China segment contributed 61.4% to the Group’s FY2015 revenue.

Segment profit decreased by S$2.5 million from S$6.3 million in the last corresponding year to S$3.8 million in the current year under review. The decrease in China segment profit was due mainly to decrease in its revenue, as certain China subsidiaries are yet to operate at their optimal efficiency. The decrease in profit was moderated by the decrease in depreciation as certain property, plant and equipment were fully depreciated in current year under review.

MALAYSIAThe Malaysian operations saw a revenue decrease of S$6.1 million or 13.0% from S$46.9 million in FY2014 to S$40.8 million in FY2015 due mainly to a reduction in orders as well as the depreciative impact of Malaysia Ringgit against Singapore Dollar. Malaysia contributed 18.4% to the Group’s FY2015 revenue.

Segment profit increased by S$2.9 million or 55.2% from S$5.2 million in FY2014 to S$8.1 million in FY2015. The improvement in profitability of the Malaysia segment, despite a decrease in revenue, was attributed to an improvement in production efficiency, better costs management by right-sizing its operations, and a reduction of low margin projects. The appreciation of US Dollar against Malaysia Ringgit further contributed to the profit increase, with foreign exchange gains increase by S$1.0 million.

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AWARDS ANDCERTIFICATIONS

2016 Corporate Certification Plan

Company Plan

Fu Hao Manufacturing (M) Sdn Bhd ISO 13485:2012

AWARDS RECEIVED BY FU YU GROUP IN YEAR 2015

Company Awards

Fu Yu Corporation Limited May Day Model Partnership Awards 2015Singapore International 100 Company 2015Singapore 1000 Company 2015

Fu Hao Manufacturing (M) Sdn Bhd Preferred Supplier Award 2015 from Bosch Germany

CORPORATE ISO AND QS CERTIFICATION FOR FU YU GROUP AS AT END OF YEAR 2015

Company ISO 9001:2008

ISO 13485:2012

ISO 14001:2004

TS 16949:2009

Fu Yu Corporation Limited ^ ^

Classic Advantage Sdn Bhd ^ ^ ^

Fu Hao Manufacturing (M) Sdn Bhd ^ ^ ^

SolidMicron Technologies Pte Ltd ^ ^

NanoTechnology Manufacturing Pte Ltd ^ ^ ^

Fu Yu Moulding & Tooling (Dongguan) Co., Ltd.

^ ^ ^

Fu Yu Moulding & Tooling (Shanghai) Co., Ltd.

^ ^ ^

Fu Yu Moulding & Tooling (Suzhou) Co., Ltd.

^ ^ ^ ^

Fu Yu Moulding & Tooling (Zhuhai) Co., Ltd.

^ ^ ^

Fu Yu Moulding & Tooling (Chongqing) Co., Ltd.

^ ^ ^

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FU YU CORPORATION LIMITED

NANOTECHNOLOGY MANUFACTURING

PTE LTD

80%

SOLIDMICRON TECHNOLOGIES

PTE LTD

100%

CHANG FU RESOURCES PTE LTD

100%

FU YU MOULDING & TOOLING (SUZHOU)

CO., LTD

100%

FU YU MOULDING & TOOLING (DONGGUAN)

CO., LTD

100%

FU YU MOULDING & TOOLING (ZHUHAI)

CO., LTD

100%

FU YU MOULDING & TOOLING (WUJIANG)

CO., LTD.∆100%

FU YU ELECTRONICS (DONGGUAN)

CO., LTD.#

100%

FU YU TRADING LIMITED

100%

FU YU INTERNATIONAL ENTERPRISE LIMITED

100%

FU YU INVESTMENT PTE LTD

100%

LCTH CORPORATION BERHAD

70.64%

CLASSIC ADVANTAGE SDN BHD

100%

FU HAO MANUFACTURING

(M) SDN BHD

100%

BERRY PLASTICS MALAYSIA SDN BHD

(FORMERLY KNOWN AS REXAM MALAYSIA SDN BHD)

40%

FU YU MOULDING & TOOLING

(SHANGHAI) CO., LTD.

100%

FU YU MOULDING & TOOLING (CHONGQING)

CO., LTD.

100%

∆ Ceased production# Dormant

GROUPSTRUCTURE

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BOARD OFDIRECTORS

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1 DR JOHN CHEN SEOW PHUN

Non-Executive Chairman, Independent Director

Dr John Chen Seow Phun, 62, was appointed as Non-Executive Chairman and Independent Director of the Company on 27 November 2007 and was last re-elected on 30 April 2013. He will stand for re-election as a Director in the forthcoming Annual General Meeting.

Dr Chen was a Member of Parliament from 1998 to 2006. He was the Assistant Secretary General of the NTUC from 1991 to 1997 and served as the Deputy Chairman and Managing Director of NTUC Healthcare Co-op from 1992 to 1997. From March 1997 to June 1999, he was the Minister of State, Ministry of Communications. And from June 1999 to November 2001, he was the Minister of State, Ministry of Communications & Information Technology as well as Ministry of National Development. Prior to joining the Government in 1997, Dr Chen has served as a Board Member of the Economic Development Board, the Housing and Development Board, the Port of Singapore Authority and Singapore Power Ltd.

Dr Chen is presently the Executive Chairman of Pavillon Holdings Ltd (formerly known as Thai Village Holdings Ltd) and the Chairman of SAC Capital Pte Ltd. He also sits on the board of a number of publicly listed companies.

Dr Chen holds a PhD in Electrical Engineering from the University of Waterloo, Canada. He taught at the National University of Singapore from 1983 to 1991.

At 31 December 2015, Dr Chen holds 0.13% direct interest in the Company.

2 CHING HENG YANG

Vice Chairman, Executive Director

Mr Ching, 65, one of the co-founders of Fu Yu, is the Vice Chairman and Executive Director of the Group. Mr Ching was appointed as the Executive Director on 10 December 1980 and was last re-elected on 30 April 2015. Mr Ching oversees the plastic injection moulding, finishing and sub-assembly operations of the Group. He is also responsible for the investment in factory buildings and machinery of the Group. Mr Ching has over 41 years of experience in the mould fabrication and plastic injection moulding industry.

Mr Ching is a member of the Singapore Institute of Directors.

At 31 December 2015, Mr Ching holds 11.81% direct interest in the Company.

3 HO NEE KIT

Executive Director

Mr Ho, 62, one of the co-founders of Fu Yu, is the Executive Director of the Group. He was appointed as the Executive Director on 10 December 1980 and was last re-elected on 29 April 2014. He will stand for re-election as a Director in the forthcoming Annual General Meeting.

Mr Ho jointly oversees the mould fabrication, plastic injection moulding, finishing and sub-assembly operations of the Group. Prior to joining Fu Yu, Mr Ho worked for a plastic injection company as a tool maker. Realising the potential of the precision mould making industry in the 1970s, together with the other 3 partners who also shared the same vision of the industry, they founded Fu Yu in 1978.

Mr Ho is a member of the Singapore Institute of Directors.

At 31 December 2015, Mr Ho holds 12.88% direct interest in the Company.

4 TAM WAI

Executive Director

Mr Tam, 65, one of the co-founders of Fu Yu, is the Executive Director of the Group. He was appointed as the Executive Director on 10 December 1980 and was last re-elected on 30 April 2013. He will stand for re-election as a Director in the forthcoming Annual General Meeting.

Mr Tam oversees the mould design and fabrication operations of the Group. Prior to joining Fu Yu, he involved in mould design and fabrication for 10 years in Hong Kong specializing in high precision moulds for the electronics and electrical industries. Mr Tam has over 46 years of experience in the mould fabrication and plastic injection moulding industry.

Mr Tam is a member of the Singapore Institute of Directors.

At 31 December 2015, Mr Tam holds 12.84% direct and 0.04% deemed interests in the Company.

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BOARD OFDIRECTORS

5 HEW LIEN LEE

Executive Director, Chief Executive Officer and Chief Operating Officer

Mr Hew, 59, was appointed as Executive Director and Chief Operating Officer of the Company on 22 March 2007. Mr Hew was appointed acting Chief Executive Officer on 21 May 2014 and was promoted to Chief Executive Officer of the Group on 26 February 2016. He was last re-elected on 30 April 2015. Mr Hew is also the Managing Director of LCTH Corporation Berhad (“LCTH”), the Malaysia subsidiary of Fu Yu Group, listed on the Main Market of Bursa Malaysia Securities Berhad, Malaysia on 8 November 2004.

Mr Hew joined Fu Yu in 1984 and holds a Diploma in Electrical Engineering. With 36 years of experience in the plastic injection moulding industry, he has played an instrumental role in the successful listing of LCTH. He is responsible for the overall strategic direction and management of the Group.

Mr Hew is a member of the Singapore Institute of Directors.

As at 31 December 2015, Mr Hew holds 1.08% direct interest in the Company.

6 TAN YEW BENG

Non-Executive Director, Independent Director

Mr Tan, 59, is a Non-Executive and Independent Director of Fu Yu. He was appointed as Director on 22 May 1995 and was last re-elected on 30 April 2015. Mr Tan is the Chairman of the Remuneration Committee and member of the Audit and Nominating Committees. He is also a director of several Singapore and Malaysia companies.

Mr Tan holds a Bachelor of Commerce Degree from Nanyang University, Graduate Diploma in Marketing Management from the Singapore Institute of Management and Diploma in Marketing from the Institute of Marketing, United Kingdom.

Mr Tan is serving actively in several social, education and community organisations. In recognition of his contribution to the community, Mr Tan was awarded the Public Service Medal (Pingkat Bakti Masyarakat - PBM) in 2008 and subsequently the Public Service Star (Bintang Bakti Masyarakat – BBM) in 2013. He is also a member of the Singapore Institute of Directors.

At 31 December 2015, Mr Tan holds 0.34% direct interest in the Company.

7 FOO SAY TUN

Non-Executive Director, Independent Director

Mr Foo, 50, is a Non-Executive and Independent Director of Fu Yu. He was appointed as Director on 27 November 2007 and was last re-elected on 29 April 2014. He is presently the Chairman of the Nominating Committee and a member of the Audit and Remuneration Committees.

Mr Foo is qualified to practise law in Singapore and Malaysia, and he used to practise civil and commercial litigation.

As at 31 December 2015, Mr Foo does not hold any direct or indirect interest in the Company.

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YEO SEE JOOGroup Business Development Director

Mr. Yeo, 52, joined Fu Yu Corporation Ltd as Group Business Development Director. He is responsible for formulating the Group’s business development strategy, developing new business/market opportunities, growing existing business and proposing direction for product development. He has over 30 years of business development experience in the plastics industry holding middle to senior management positions. He joined Philips Machine Factory in 1983 as a mold maker and later joined Tritech Manufacturing Pte Ltd as mold designer and project engineer in 1986, and in 1994 joined Thomson Multi Media as a Tooling Engineer. In 1995 he joined TTL Holding Ltd (also known as Scintronix Corporation Ltd) and in-charge of the Sales and Marketing and Programs Management in the company till 2005. He later joined Watson Plastics Manufacturing Pte Ltd as the Corporate Business Development Director. He holds an Advance Diploma in Business Management from University of Bradford.

TAN LAY KHENGGroup Human Resource Director

Madam Tan, 62, was the Group Human Resource Manager before she is promoted to Group Human Resource Director in October 2008. She oversees the management and development of the human resources across the Group. She is also responsible for the administrative function of the Group. Madam Tan has 40 years of experience in Industrial Relations Management. She holds a Bachelor of Art Degree from Nanyang University of Singapore.

CHEAH NGOOK WAHSenior Group Financial Controller

Ms Cheah, 42, is the Senior Group Financial Controller of Fu Yu Group. She joined Fu Yu in August 2002 and was promoted to Group Financial Controller in June 2006. In July 2015, Ms Cheah was promoted to Senior Group Financial Controller. She is responsible for the Group’s accounting and finance functions. Prior to joining Fu Yu, she was an auditor with two of the international accounting firms for five years. Ms Cheah is a member of Certified Public Accountant Australia and graduated from the University of Western Australia. She holds a Bachelor of Commerce Degree.

KEYEXECUTIVES

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FU YU MOULDING & TOOLING (DONGGUAN) CO., LTDJing Fu Rd, Xin Cheng Industry AreaHeng Li Town, DongguanGuangdong, China 523477Tel: (86769) 8982 1818Fax: (86769) 8982 1815

LCTH CORPORATION BERHAD21 Jalan Teknologi 4Taman Teknologi Johor81400 Senai, Johor, MalaysiaTel: (607) 599 9980Fax: (607) 599 9982www.lcthcorp.com

FU YU CORPORATION LIMITED (HEADQUARTERS)8 Tuas Drive 1, Singapore 638675Tel: (65) 6578 7338Fax: (65) 6578 7347www.fuyucorp.com

NANOTECHNOLOGY MANUFACTURING PTE LTD8 Tuas Drive 1, Singapore 638675Tel: (65) 6755 2280Fax: (65) 6755 7326www.nanotechnology.com.sg

SOLIDMICRON TECHNOLOGIES PTE LTD7 Tuas Drive 1, Singapore 638674Tel: (65) 6933 8700Fax: (65) 6933 8720www.solidmicrontech.com

SINGAPORE

MALAYSIAFU HAO MANUFACTURING (M) SDN BHDPlot 562 Mukim 1Lorong Perusahaan Baru 1 Perai IIIPerai Industrian Estate, 13600 PeraiPenang, MalaysiaTel: (604) 398 0500Fax: (604) 398 3221

CLASSIC ADVANTAGE SDN BHD21 Jalan Teknologi 4Taman Teknologi Johor81400 SenaiJohor, MalaysiaTel: (607) 599 9980Fax: (607) 599 9982

CHINAFU YU MOULDING & TOOLING (ZHUHAI) CO., LTD477Jinhaian Road, Sanzao TownJin Wan District, Zhuhai, Guangdong China 519040Tel: (86756) 7761 862Fax: (86756) 7761 851

FU YU MOULDING & TOOLING (SHANGHAI) CO., LTD888 Xin Ling RoadWaiGaoQiao Free Trade ZoneShanghai, China 200131Tel: (8621) 5046 1225Fax: (8621) 5046 0229

FU YU MOULDING & TOOLING (SUZHOU) CO., LTD89 Xing Nan RoadWuzhong Economic Skill Development ZoneSuzhou, China 215128Tel: (86512) 6562 1838Fax: (86512) 6563 9463

FU YU MOULDING & TOOLING (CHONGQING) CO., LTDBlk 2 & 3, 18 Shi Gui Ave, Jie Shi Town Banan District, Chongqing China 401346Tel: (8623) 6121 9988Fax: (8623) 6121 9988-690

OURNETWORK

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CORPORATEMILESTONE

200920102012

• GrantofOptionspursuanttoFuYuEmployeesShareOptionScheme

• Completionofsaleandleasebackofpropertylocatedat11JalanPersiaranTeknologi,TamanTeknologiJohor,Senai,Johor,Malaysia

• CompletionofCapitalRepaymentandSharesConsolidationofLCTHCorporationBerhad

• ObtainedISO9001:2000,ISO14001andTS16949certificationforourplantinShanghai

• IncorporationofFuYingMoulding&Tooling(Shenzhen)Co.,LtdinShenzhen,China

• ObtainedISO14001:2004certificationforourplantinPenang,Malaysia

• ObtainedTS16949certificationforourplantinJohor,Malaysia

• ConversionofISO9001:2000toISO9001:2008certificationfortheCompanyandourplantinPenang,Malaysia

• EnteredintosaleandpurchaseagreementtodisposepropertiesinTianjinplant,China

• Disposalof100%interestinQingDaoFuQiangElectronicsCo.,Ltd

• SaleandleasebackofFuYuMoulding&Tooling(Shanghai)Co.,Ltd’sproperties

• Completionofmember’svoluntaryliquidationofFuYuGuadalajaraS.A.DeC.V.

• ObtainedISO14001:2004andOHSAS18001:2007certificationforourplantinJohor,Malaysia

• ObtainedTS16949:2009certificationforourplantsinDongguan,ZhuhaiandSuzhouinChina

• ConversionofISO9001:2000toISO9001:2008certificationforourplantsinJohor,MalaysiaandDongguan,Zhuhai,Shanghai,Suzhou,WujianginChinaandSolidMicroninSingapore

• SetupFuYuMoulding&Tooling(Chongqing)Co.,LtdbyFuYuMoulding&Tooling(Shanghai)Co.,LtdinChina

• ObtainedISO13485:2003certificationforourplantsinJohor,MalaysiaandSuzhouinChina

• ObtainedTS16949:2009certificationforourplantinPenang,Malaysia

• Completionofmember’svoluntaryliquidationofFuYuMoulding&Tooling(Tianjin)Co.,Ltd

• Completionofmember’svoluntaryliquidationofFuYuMoulding&Tooling(Wuxi)Co.,Ltd

20082011

• SetupSenawangplantbyClassicAdvantage

SdnBhd• Completionof

disposalofpropertiesinTianjinplant,

China

• ObtainedISO9001:2008certificationforourplantinChongqing,China

• ExpiryofFuYuEmployeesShareOptionSchemeon31December2014

• Obtainedshareholders’approvalforsharepurchasemandate

• Completionofcapitalreductionandcashdistributiontoshareholders

• ObtainedISO14001:2004andTS16949:2009certificationforourplantinChongqing,China

• Completionofmember’svoluntaryliquidationofFuYingMoulding&Tooling(Shenzhen)Co.,Ltd

2014

20152007

• Placementof117millionnewordinarysharesatS$0.18eachinthecapitaloftheCompany

• SignedSaleandPurchaseAgreementforsaleandleasebackofpropertylocatedat11JalanPersiaranTeknologi,TamanTeknologiJohor,Senai,Johor,Malaysia

• SetupFuYuMoulding&Tooling(Wuxi)Co.,Ltd,China

• DisposalofKodon(Tianjin)Electronics&ElectricalApparatusCo.,Ltd,China

• ImplementedSAPEnterpriseResourcePlanningSystematFuYuMoulding&Tooling(Suzhou)Co.,Ltd,China

• ObtainedISO9001:2000certificationforSolidMicronTechnologiesPteLtd

• ObtainedISO13485:2003certificationforNanoTechnologyManufacturing

PteLtd

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• ImplementedSAPEnterpriseResourcePlanningSysteminSingapore

• AchievedISO14001certificationforourplantinSingapore

• AchievedISO9001:2000certificationforourplantinSenai,Malaysia

• AdditionalwarehousebuiltforourplantinTianjin,China

2001

• ChangeofCompany’snamefromFuYuManufacturingLimitedtoFuYuCorporationLimited

• Placementof23millionnewOrdinarySharesofS$0.10eachinthecapitaloftheCompany

• ListingofLCTHCorporationBerhadontheMainBoardofBursaMalaysiaSecuritiesBerhad(formerlyknownasMalaysiaSecuritiesExchangeBerhad)inMalaysia

• PurchaseoflandandconstructionofbuildingsinJohorTechnologyParktoincreasemanufacturingcapacityinJohor,Malaysia

• JointventurewithEDBVenturesPte.Ltd.onthesetupofanewcompany,NanoTechnologyManufacturingPte.Ltd.inSingapore

• WindupofMexicoplant• SetupplantinWujiang,China• SetupplantinQingdao,China• SetupanotherplantinShanghai,China• ConversionofISO9002toISO

9001:2000forourplantinSuzhou,China

• AchievedISO9001:2000certificationforourplantatWujiang,China

• AchievedISO9001:2000certificationforourplantatZhuhai,China

200420052006

• Completionofsaleandleasebackofpropertyat2SerangoonNorthAvenue5,Singapore

• JointventurebyLCTHCorporationBhd(Malaysia)withOwens-lllinoisPlasticsPteLtdonthesetupofanewcompany,O-IPlasticsMalaysiaSdnBhdinMalaysia

• SetupSolidMicronTechnologiesPte.Ltd.,Singapore

• AchievedISO14001certificationforourplantsatSuzhouandQingdao,China

2003

• SubmittedtheapplicationtotherelevantauthoritiesforthelistingofitsproposedMalaysiasubsidiarycompanyonthemainboardoftheMalaysiaSecuritiesExchangeBerhad

• SetupplantinZhuhai,China• Setupamanagement

company,FuYuInternationalEnterpriseLimitedinHongKong

• ImplementedSAPEnterpriseResourcePlanningSystemforourplantsinJohor,Malaysia

• ConversionofISO9002toISO9001:2000forourplantinSingapore

• ExtensionofISO14001toourTuasplantinSingapore

• ConversionofISO9002toISO9001:2000andachievedQS9000certificationforourplantinPenang,SenaiandKluang,Malaysia

• ConversionofISO9002toISO9001:2000andachievedQS9000certificationforourplantinDongguan

• EnteredintoaPutandCallOptionAgreementforsaleandleasebackofPropertyat2SerangoonNorthAvenue5,Singapore

• EnteredintoaMemorandumofUnderstandingbyLCTHCorporationBhd(Malaysia),withKnobsSdnBhd(Malaysia)toco-operateandworktogetherasastrategicalliance

• ImplementedSAPEnterpriseResourcePlanningSystematFuYuMoulding&Tooling(Dongguan)Co.,Ltd,China

• SetupFuYuElectronics(Dongguan)Co.,Ltd,China

• AchievedISO9001:2000&ISO14001forNanoTechnologyManufacturingPteLtd,Singapore

• AchievedISO14001certificationforourplantatDongguan,China

• AchievedTS16949certificationforourplantatTianjin,China

• AchievedISO9001:2000certificationforourplantatQingdao,China

• WindupofUSAplant

2002

• CommencedimplementationofSAPEnterpriseResourcePlanningSystemforourplantsinJohor,Malaysia

• AchievedISO9002:1994forourplantinMexico

• AdditionalfactorybuiltforourplantinSuzhou,China

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Introduction

TheBoardofDirectors(the“Board”)andManagementofFuYuCorporationLimited(the“Company”or“FuYu”)recognise the importance of having in place a set of well-defined corporate governance processes to enhancecorporateperformanceandaccountability.

This reportdescribesFuYu’smaincorporategovernancepracticesandactivitieswith reference to theSingaporeCodeofCorporateGovernance2012(the“Code”)andanydeviationsfromtheCodeareexplained.Unlessotherwisestated,thecorporategovernanceprocesseswereinplaceduringthefinancialyearunderreview.

BOARD MATTERS

Principle 1: The Board’s Conduct of Affairs

TheprincipalfunctionoftheBoardistoprotectandenhancelong-termvalueandreturnsforitsshareholders.Besidescarryingoutitsstatutoryresponsibilities,theBoard’srolesareto:

1. overseethemanagementoftheGroup;

2. approvecorporateandstrategicdirectionandpolicies;

3. approveannualbudgets,financialreporting,majorfundingandinvestmentproposals;

4. monitormanagementperformance;

5. ensure the Company’s compliance with prescribed legislations and regulations that are relevant to thebusiness;and

6. assumeresponsibilityforcorporategovernance.

AlltheDirectorsexerciseduediligence,independentjudgmentandconsidertheinterestoftheGroupatalltimesinmakingthedecisionsfortheGroup’saffairs.

Toassistinthedischargeofitsresponsibilities,theBoardhasestablishedanumberofBoardCommitteescomprisingtheAuditCommittee,RemunerationCommitteeandNominatingCommittee.Termsofreferencehasbeenputinplaceforeachoftherespectivecommittees.

TheBoardmeets regularlyonaquarterlybasisandad-hocBoardmeetingsare convenedwhencircumstancesrequire.TofacilitateBoard’sdecision-makingprocess, theCompany’sConstitutionallowsDirectors toparticipatein Board meetings by means of telephone, electronic or other communication facilities that permit all personsparticipatinginthemeetingtocommunicatewithoneanothersimultaneouslyandinstantaneously,andparticipationinsuchmeetingshallconstitutepresenceinpersonatsuchmeeting.InbetweenBoardmeetings,importantmattersconcerning theGrouparealsoput to theBoard for itsdecisionbywayofdirectors’ resolutions inwriting for theDirectors’approval.

CORPORATEGOVERNANCE REPORT

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DetailsoftheDirectors’attendanceatBoardandCommitteesmeetingsduringtheyearunderreviewareasfollows:

Name of DirectorBoard

Audit Committee

Remuneration Committee

Nominating Committee

No. of Meetings

Held

No. of Meetings Attended

No. of Meetings

Held

No. of Meetings Attended

No. of Meetings

Held

No. of Meetings Attended

No. of Meetings

Held

No. of Meetings Attended

ChingHengYang 4 4 – – – – – –

TamWai 4 4 – – – – – –

HoNeeKit 4 4 – – – – – –

HewLienLee 4 4 – – – – – –

DrJohnChenSeowPhun

4 4 4 4 1 1 1 1

FooSayTun 4 4 4 4 1 1 1 1

TanYewBeng 4 4 4 4 1 1 1 1

TheCompanyhasestablishedinternalguidelinesformattersandtypesofmaterialtransactionsthatrequireBoard’sapproval.Theseinclude:

(a) allotmentandissueofnewsharesandadditionallistingapplication;

(b) bankingmatterssuchasopeningofbankaccountsandacceptanceofbankfacilities;

(c) materialacquisitionanddisposalofsubsidiariesandotherassets;

(d) announcementsforpublicrelease,quarterlyandfullyearresultsannouncement;

(e) anymajoragreementstobeenteredintowhetherintheordinaryoroutsideofordinarybusinessoftheGroup;

(f) dividendrecommendationsandpayment;and

(g) appointmentsandresignationsofdirectors. NewlyappointedDirectorswouldbebriefedbyManagementonthebusinessoperationsof theGroupandwherenecessaryplantvisitswouldbeorganisedasdeemednecessary.Routineupdatesondevelopmentsandchangesinoperatingenvironment,includingrevisionstoaccountingstandards,lawsandregulationsaffectingtheCompanyand/ortheGroupareregularlybroughttotheattentionoftheBoard.

Principle 2: Board Composition and Guidance

TheBoardcomprisesseven(7)Directorsofwhomfour(4)areexecutiveandthree(3)areindependentandnon-executive.TheBoardhasexamineditssize,takingintoaccountthescopeandnatureoftheoperationsoftheGroup,andissatisfiedthatthepresentsizeisappropriateinfacilitatingeffectivedecision-making.Boardmemberscompriseofprofessionalswithfinancial,accounting,legalandindustrybackgroundswhoareabletocontributetheirareaofexpertiseinleadingtheGroup.WhiletheBoarddoesnotcompriseanyfemaledirectoratthemoment,itscurrent

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compositionwithappropriatemixofexpertiseandexperienceenablestheManagementtobenefitfromadiverseandobjectiveperspectiveonanyissuesraisedbeforetheBoard.Noindividualorgroupof individualsdominatestheBoard’sdecisionmaking.

MrTanYewBeng(“MrTan”)hasbeenanindependentandnon-executivedirectoroftheCompanyformorethannine(9)years.TheNChasassessedMrTan’sindependenceandhasrecommendedtotheBoardofDirectorsthatMrTanremainsindependent.Inarrivingatthatconclusion,theNCtookintoaccountthatMrTanhasnever,andisnot,involvedinthedaytodaymanagementoftheCompany.ThereisnothingtosuggestthatMrTanhasanyrelationshipwiththeManagementwhichwouldimpairhisfairjudgment.TheNCalsonotedthatMrTanhasalwaysexercisedhisjudgmentintheinterestoftheCompanyandtheminorityshareholders,andhasexpressedhisviewsindependentlyatalltimes.TheBoardofDirectorsalsobenefitsfromMrTan’sbusinessexperienceandacumenwhichhebringstoBoardmeetings.

TheprofileofeachDirectorandotherrelevantinformationaresetoutundertheheading‘BoardofDirectors’onpages8to10.

Principle 3: Chairman and Chief Executive Officer

TheBoardrecognisedtheimportanceof therolesofChairmanandChiefExecutiveOfficer(“CEO”)tobeheldbyseparatepersons.

DrJohnChenSeowPhunistheNon-ExecutiveChairmanoftheCompanyandMrHewLienLeeistheCEOoftheCompany.

The Non-Executive Chairman schedules board meetings when necessary and set the board meeting agenda inconsultationwiththeCEOandSeniorGroupFinancialController.HeensuresthattheBoardmembersareprovidedwithcomplete,adequateandtimelyinformation.TheNon-ExecutiveChairmanalsoassistsinensuringcompliancewiththeGroup’sguidelinesoncorporategovernance.

Principle 4: Board Membership

TheNominatingCommittee (“NC”) currently comprisesMr FooSay Tun,Mr TanYewBengandDr JohnChenSeowPhun.TheNCischairedbyMrFooSayTunwhoisnotassociatedwithanysubstantialshareholdersoftheCompany.

TheNChaswrittenTermsofReferencethatdescribetheoperatingproceduresandresponsibilitiesofitsmembers.

ThedutiesoftheNCareasfollows:

1. Reviews the structure, size and composition of the Board and makes recommendations to the Board with regards to any adjustments in the structure, size and composition of the Board that are deemednecessary;

2. Reviewsallnominationsfortheappointmentsandre-electionsofDirectorforthepurposeofproposingsuchnominationstotheBoardforapproval;

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3. ConductsareviewtodeterminetheindependenceofeachDirector;

4. DecideswhetherornotaDirectorisabletoandhasbeenadequatelycarryingouthisdutiesasaDirectoroftheGroup,particularlywhenhehasmultipleboardrepresentations;

5. DecideshowtheBoard’sperformancemaybeevaluatedandproposesobjectiveperformancecriteria;

6. Conductsa formalassessmentof theeffectivenessof theBoardasawholeandthecontributionbyeachDirectortotheeffectivenessoftheBoard;and

7. RecommendtotheBoardthemaximumnumberoflistedcompanyrepresentationswhichanyDirectormayhold.

Initsannualreview,theNChavingconsideredtheguidelinessetoutintheCode,hasconfirmedindependencestatusoftheIndependentDirectors.DespitesomeoftheDirectorshavingotherboardrepresentations,theNCissatisfiedthattheseDirectorsareabletodevotesufficienttimeandattentiontoattendtotheaffairsoftheCompanyandadequatelycarryouttheirdutiesasDirectorsoftheCompany.

Basedon thecurrentandpastworkingexperiencewith theBoardmembersof theCompanyofwhomsomearesittingandhavebeensittingonmultipleboards,theNCdeterminesthattheappropriatemaximumnumberofthelistedcompanyboardrepresentationswhichanExecutiveDirectormayholdisthree(3)andforIndependentNon-ExecutiveDirectorisnine(9).TheNCwillcontinuetoassesswhetherthesenumbersneedtoberevisedtoensuretheDirectorsdevotesufficienttimeandattentiontotheaffairsoftheCompany.

InaccordancewiththeCompany’sConstitution,allDirectorssubmitthemselvesforre-electiononceeverythree(3)years.Inaddition,aDirectorappointedbytheBoardtofillacasualvacancy,orappointedasanadditionalDirector,mayonlyholdofficeuntilthenextAnnualGeneralMeeting(“AGM”),atwhichtimehewillbeeligibleforre-electionbyshareholders.

Inrecommendingacandidateforappointmentorre-appointmenttotheBoard,theNCconsidershiscontributionstotheBoardandhisindependence.TheNChasrecommendedthere-electionofDrJohnChenSeowPhun,MrHoNeeKitandMrTamWaiasDirectorsoftheCompanyattheforthcomingAGM.Inmakingitsrecommendation,theNCevaluatessuchDirectors’contributionandperformance,suchastheirattendanceatthemeetingsoftheBoardandBoardCommittees,whereapplicable,participation,candourandanyspecialcontribution.SaveforMrHoNeeKitandMrTamWaiwhoarealsosubstantialshareholdersholding12.88%and12.84%oftheCompany’ssharecapitalrespectively,therearenorelationshipsincludingimmediatefamilyrelationshipsbetweentheseDirectorssubmittedforre-electionandtheotherDirectors(exceptforMrChingHengYang,MrHoNeeKitandMrTamWaiwheretheyareconcertparties), theCompanyor its10%shareholders.TheBoardaccepted theNC’s recommendationandaccordingly,thethree(3)Directorswillstandforre-electionattheforthcomingAGM.

TheNC takes the lead in identifying, evaluatingand selecting candidate for newdirectorship. In its searchandselectionprocess,theNCconsidersfactorssuchascommitmentandabilityofprospectivecandidatetocontributetodiscussion,deliberationsandactivitiesoftheBoardandBoardCommittees.

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Table for Appointment and Re-election

Name of Directors Date offirst

appointment

Date of lastre-election

Nature of Appointment

Membership of Board

Committee

Directorship/ Chairmanship

both present and those held over the preceding three years

in other listed company

Other Principal Commitments

DrJohnChenSeowPhun

27/11/2007 30/04/2013 Non-executiveChairman

1.ChairmanofAuditCommittee

2.MemberofNominatingandRemunerationCommittees

Present:-1.Pavillon

HoldingsLtd2.OKPHoldings

Limited3.HiapSeng

EngineeringLtd4.Hanwell

HoldingsLtd5.Matex

InternationalLimited

6.TatSengPackagingGroupLtd

7.HLHGroupLimited

Precedingthreeyears:-NIL

Directorin:1.JCLBusiness

DevelopmentPteLtd

2.SACCapitalPrivateLimited

3.NationalUniversityHealthSystemPteLtd

4.DATAESPPteLtd

5.PatternDiscoveryTechnologiesPteLtd

6.JLMFoundationLtd

MrChingHengYang 10/12/1980 30/04/2015 ExecutiveDirector

– – –

MrTamWai 10/12/1980 30/04/2013 ExecutiveDirector

– – –

MrHoNeeKit 10/12/1980 29/04/2014 ExecutiveDirector

– – Presidentof:1.SingaporeLoh

KangHoClanAssociation

2.ChaYongHoClanAssociationSingapore

MrHewLienLee 22/03/2007 30/04/2015 ChiefExecutiveOfficerandExecutiveDirector

– 1.LCTHCorporationBerhad

–

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Name of Directors Date offirst

appointment

Date of lastre-election

Nature of Appointment

Membership of Board

Committee

Directorship/ Chairmanship

both present and those held over the preceding three years

in other listed company

Other Principal Commitments

MrTanYewBeng 22/05/1995 30/04/2015 IndependentNon-ExecutiveDirector

1.ChairmanofRemunerationCommittee

2.MemberofAuditandNominatingCommittees

– Directorin:1.Accord

CorporationPteLtd

2.Locker&LockPteLtd

3.SA-KoyoPteLtd

4.AccordCorporationSdnBhd

5.Locker&LockSdnBhd

MrFooSayTun 27/11/2007 29/04/2014 IndependentNon-ExecutiveDirector

1.ChairmanofNominatingCommittee

2.MemberofAuditandRemunerationCommittees

Present:1.Jubilee

IndustriesHoldingsLimited

2.QingmeiGroupHoldingsLimited

3.SinoTechfibreLimited

4.MoneymaxFinancialServicesLimited

Precedingthreeyears:-NIL

Directorin:1.Aquagreen

TechnologyPteLtd

2.AquaproSolutionsPteLtd

3.DynaGenPowerSystemsPteLtd

4.IoniWaterPteLtd

Principle 5: Board Performance

Fortheyearunderreview,aformalassessmentoftheeffectivenessoftheBoardasawholewasundertakenbytheNC.TheNCwasoftheviewthattheperformanceoftheBoardasawholewassatisfactory.

TheNC,inassessingthecontributionofeachDirector,hadconsideredhisattendanceandparticipationatBoardandBoardCommitteesmeetings,hisqualification,experienceandexpertiseandthetimeandeffortdedicatedtotheGroup’sbusinessandaffairsincludingmanagement’saccesstotheDirectorsforguidanceorexchangeofviewsasandwhennecessary.InassessingtheeffectivenessoftheBoardasawhole,bothquantitativeandqualitativecriteriaareconsidered.Suchcriteriaincludeprofitabilityandnetassetspershareandtheachievementofstrategicobjectives.

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TheNCviewsthattheBoard’sperformancewouldbebetterreflectedandevidencedthroughproperguidancetotheManagementandableleadershipoftheBoardandthesupportthatitlendstoManagementinsteeringtheGroupintheappropriatedirection.

Principle 6: Access to InformationPrinciple 10: Accountability

TheBoardreceivesmonthlyGroup’sfinancialreportsandquarterlymanagementreportoftheGroup’sactivitiesandresults.Management provides complete, adequateand timely information to theBoardmembersprior toBoardmeetings.TheannualbudgetsaresubmittedtotheBoardforreviewandapprovalandactualperformanceiscompared againstbudgetsperiodicallytomonitortheGroup’sperformance.

TheDirectorshaveseparateandindependentaccesstotheExecutiveDirectors,theManagementandtheCompanySecretaryatall times,andviceversa.TheCompanySecretaryor itsnomineeattendsto thecorporatesecretarialadministrationmatters,attendsmeetingsoftheBoardandBoardCommitteesandassiststheBoardinensuringthattheBoardproceduresarefollowedandthatapplicablerulesandregulationsarecompliedwith.

TheBoardalsohasaccessto independentprofessionaladvice,wherenecessary,at theCompany’sexpensestoenablethemtodischargetheirduties.TheSeniorGroupFinancialControlleralsoassiststheBoardinobtainingsuchadvice.

REMUNERATION MATTERS

Principle 7: Procedures for Developing Remuneration Policies

TheRemunerationCommittee(“RC”)currentlycomprisesMrTanYewBeng,DrJohnChenSeowPhunandMrFooSayTunwhoareNon-ExecutiveIndependentDirectors.TheRCischairedbyMrTanYewBeng.

TheRChaswrittenTermsofReferencethatdescribetheresponsibilitiesofitsmembers.

TheprimaryfunctionsoftheRCaretoreviewandrecommendageneralframeworkofremunerationfortheBoardandkeymanagementpersonnel(CEOandotherpersonshavingauthorityandresponsibilityforplanning,directingandcontrollingtheactivitiesoftheCompanyandwhoarenotalsodirectorsandCEOoftheCompany);toreviewandrecommendspecific remunerationpackagesand termsofemployment foreachExecutiveDirectorandkeymanagement personnel; to recommend any long-term incentive schemes which are generally encouraged forExecutive Directors and key management personnel; to ensure that a formal and transparent procedure is inplaceforfixingtheremunerationpackagesoftheExecutiveDirectorsaswellaskeymanagementpersonneloftheGroup;toreviewtheCompany’sobligationsarisingintheeventofterminationoftheExecutiveDirectorsandkeymanagementpersonnel’scontractsofservice.TheRC’srecommendationsaresubmittedforendorsementbytheentireBoard.

TheRChasunrestrictedaccesstoexpertadvicewithinand/oroutsideoftheCompany,whenrequired.

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Principle 8: Level and Mix of Remuneration

InsettingtheremunerationpackagefortheExecutiveDirectorsandkeymanagementpersonnel,theRCtakesintoconsiderationthepayandemploymentconditionswithintheindustryandcomparablecompanies, theindividualperformanceand thatof theCompanyandsubsidiarycompanies.Aspartof its review, theRCensures that theperformance-relatedelementsof remunerationwould formacertainproportionof the total remunerationpackageof Executive Directors and key management personnel. The remuneration for the three (3) founding ExecutiveDirectorscomprisesabase fee,abasesalary,anannualwagesupplement(AWS)andaprofitsharingbonus.The remuneration for theotherExecutiveDirectorcomprisesabase fee,abasesalary,allowances,annualandprofitsharingbonuses.Theremunerationforthekeymanagementpersonnelcomprisesabasicsalary,allowancesand variable components which are the annual bonus and profit sharing bonus based on the performance oftheCompanyandsubsidiarycompaniesaswellasindividualcontributionandperformancewhichareassessedthroughperformanceappraisalthatsetoutvariousassessmentcriteriasuchaslevelofachievementoftargetsandresponsibilities,leadershipability,initiativeetc.

FortheremunerationoftheNon-ExecutiveDirectors,theRChasadoptedaframeworkwhichconsistsofabasefeeaswellasfeesforchairingBoardCommittees.TheCompanywillsubmitthequantumofDirectors’feestoshareholdersforapprovalattheAGM.

Allthefour(4)ExecutiveDirectorshaveservicecontractsforafixedperiodofoneyearwhicharesubjecttorenewalannually.TheRChadreviewedandrecommendedtotheBoardtherenewalofthecontractsofthefour(4)ExecutiveDirectorsforafurthertermofoneyear,from1January2016to31December2016.TheservicecontractforoneoftheExecutiveDirectorshasbeenrevisedfollowinghispromotiontoCEOon26February2016.TheBoardapprovedalltheaboverenewal.

NoDirector is involved in deciding in his own remuneration, except in providing information and documents ifrequiredbyRCtoassistinitsdeliberations.

TherearecurrentlynocontractualprovisionstoallowtheCompanytoreclaimincentivecomponentofremunerationfrom the Executive Directors and key management personnel in exceptional circumstances of misstatement offinancialresults,orofmisconductresultinginfinanciallosstotheCompany.However,theCompanybelievesthatitshouldbeabletoseekremediesagainsttheExecutiveDirectorsandkeymanagementpersonnelviaothermeansifsuchexceptionalcircumstancesoccur.

There is currently no long-term incentive scheme for the Directors of the Group and there is currently no otherunexpiredshareoptions.

SaveforthecontributionstodefinedcontributionplansasdisclosedinNote30oftheAuditedFinancialStatementsforFY2015,theCompanydoesnotprovideanyothertermination,retirementandpost-employmentbenefitstotheDirectors,theCEOandkeyexecutivespersonnel.

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Principle 9: Disclosure on Remuneration

RemunerationofBoardofDirectors

Inviewofthesensitivityandconfidentialitynatureofremunerationpackages,theBoardhasdecidednottodisclosetheremunerationoftheCompany’sindividualDirectorsindollarterms.TheaggregateremunerationpercentagepaidtooraccruedfortheDirectorsforservicesinallcapacitiesfortheyearunderreviewistabulatedbelow:

Name of DirectorFees %

Salary %

Bonus %

Other Benefits %

Total %

ExecutiveDirectors S$750,000toS$999,999ChingHengYang 3.6 71.8 22.4 2.2 100.0TamWai 3.6 71.8 22.4 2.2 100.0HoNeeKit 3.9 71.5 22.4 2.2 100.0

S$500,000toS$749,999HewLienLee 5.6 62.8 20.2 11.4 100.0

Non-ExecutiveDirectors BelowS$250,000DrJohnChenSeowPhun 100.0 – – – 100.0TanYewBeng 100.0 – – – 100.0FooSayTun 100.0 – – – 100.0

TheaggregateamountofremunerationpaidorpayabletotheCompany’sDirectorsisS$3,292,000.

RemunerationofKeyExecutives

Detailsoftotalremunerationpercentagepaidorpayabletothetopfour(4)keyexecutivesoftheGroupfortheyearunderreviewistabulatedasbelow:

Name of Key ExecutiveSalary

%Bonus

%Other Benefits

%Total %

S$250,000toS$499,999CheahNgookWah SeniorGroupFinancialController 71.6 22.1 6.3 100.0

BelowS$250,000YeoSeeJoo GroupBusinessDevelopmentDirector 70.6 12.2 17.2 100.0

TanLayKheng GroupHumanResourceDirector 79.0 17.3 3.7 100.0

TanCheeKian* ActingCFO,GeneralManagerofFuYuDongguan 80.6 8.6 10.8 100.0

*Resignedon30September2015.

Theaggregateamountofremunerationpaidtothetopfour(4)KeyExecutivesisS$857,000.

Noemployeeof theGroupwasan immediate familymember(asdefined in theListingManualofSGX-ST)ofaDirectororChiefExecutiveOfficerandwhoseremunerationexceededS$50,000duringthefinancialyearended31December2015.

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ACCOUNTABILITY AND AUDIT & COMMUNICATION WITH SHAREHOLDERS

Principle 12: Audit Committee

TheAuditCommittee(“AC”)comprisesDrJohnChenSeowPhun,MrTanYewBengandMrFooSayTun,whoareIndependentNon-ExecutiveDirectors.TheChairmanoftheACisDrJohnChenSeowPhun.

Two(2) ofthemembersofAChaverelevantaccountingandfinancialmanagementexperience.

TheACcarriesoutitsfunctionsinaccordancewiththeCompaniesActanditswrittentermsofreference.Inperformingthosefunctions,theAC:

1. ReviewstheauditplansandthefindingsoftheinternalandexternalauditorsoftheCompanyandensurestheadequacyof theCompany’ssystemof internalcontrolsandtheco-operationgivenbytheCompany’sManagementtotheexternalandinternalauditors;

2. Reviewsthequarterlyandannualfinancialstatementsandtheauditors’reportoftheCompanybeforetheirsubmissiontotheBoard;

3. ReviewswiththeManagementontheadequacyandeffectivenessoftheCompany’sinternalcontrols,includingfinancial,operational,complianceandinformationtechnology;

4. Reviewslegalandregulatorymattersthatmayhaveamaterialimpactonthefinancialstatements,relatedcompliancepoliciesandprogrammesandanyreportsreceivedfromregulators;

5. ReviewsarrangementsbywhichemployeesoftheGroupmayinconfidence,raiseconcernsaboutpossibleimproprietiesinmattersoffinancialreportingorothermattersandensuresthatarrangementsareinplacefortheindependentinvestigationofsuchmattersandforappropriatefollow-upactions;

6. Reviewsthecosteffectiveness,independenceandobjectivityoftheexternalauditors;

7. Reviewsthenatureandextentofnon-auditservicesprovidedbytheexternalauditors;

8. ReviewstheassistancegivenbytheCompany’sofficerstotheinternalandexternalauditors;

9. Nominatestheexternalauditors;

10. Toapprovethehiring,removal,evaluationandcompensationoftheinternalauditfunction,ortheprofessionalfirmtowhichtheinternalauditfunctionisoutsourced;and

11. ReviewsinterestedpersontransactionsandimproperactivitiesoftheCompany,ifany.

TheAChasthepowertoconductorauthoriseinvestigationsintoanymatterswithintheAuditCommittee’sscopeofresponsibility.Ithasfullaccessto,andco-operationof,ManagementandfulldiscretiontoinviteanyDirectorormembersofManagementtoattenditsmeetings.TheACmeetswiththeinternalandexternalauditorswithoutthepresenceoftheCompany’sManagementatleastonceannually,whichallowsforamoreopendiscussiononanyissueofconcern.TheAChasbeengiventhereasonableresourcesforittodischargeitsfunctionsproperly.

TheACmeetsatleastfour(4)timesayearwithManagementandtheexternalauditorsandiskeptabreastbytheManagementandCompanySecretaryofchangestoaccountingstandards,theListingManualoftheSGX-STandotherregulationswhichcouldhaveimpacttotheGroup’sbusinessandfinancialstatements.

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TheCompanyhas inplaceawhistle-blowing frameworkwhere employeesof theGrouphaveaccess to theACChairmantoraiseconcernsaboutimproprieties.DetailsofthispolicyhavebeendisseminatedandcontactdetailsoftheACChairmanaremadeavailabletoallemployeesoftheGroup.ACwillcarryoutindependentinvestigationsonthecomplaintsreceivedandwillreporttheoutcometotheBoardforappropriateactionstobetaken. TheCompany’sexternalauditors,KPMGLLP,aspartof theirannualstatutoryaudit,carriesout testofoperatingeffectivenessovercertaininternalcontrolsrelatingtofinancialreportingprocessbasedonthescopeofauditaslaidoutintheirauditplan.Internalcontrolweaknessesnotedduringtheaudit,andauditors’recommendationstoaddresssuchnon-complianceandweaknesses,ifany,arediscussedwithManagementandreportedtotheAC.

Theauditfeespaid/payabletotheexternalauditorsoftheCompany,overseasaffiliatesoftheexternalauditorsoftheCompanyandotherauditorsfortheauditofFY2015amountedtoS$148,000,S$173,000andS$128,000respectively.Thenon-auditfeepaidtotheexternalauditorsoftheCompanyduringtheyearamountedtoS$26,000.Non-auditfeespaidtootherauditorsamountedtoS$14,000.TheACissatisfiedwiththeindependenceofKPMGLLP.

OthermemberfirmsofKPMG Internationalareauditorsofsignificant foreign-incorporatedsubsidiariesexcept forLCTHCorporationBerhadanditssubsidiaries,whichareauditedbyErnst&Young,Malaysia.

TheBoardandACaresatisfiedthattheappointmentwouldnotcompromisethestandardandeffectivenessoftheauditoftheGroup.TheCompanyconfirmsthatitisincompliancewithRules712and715oftheSGXListingManual.

Pleaserefertopages9and10undertheheading‘BoardofDirectors’forthequalificationsoftheACmembers.

Principle 11: Risk Management and Internal Controls

TheManagementmaintainsasoundsystemofinternalcontroltosafeguardtheshareholders’investmentandtheCompany’sassets.TheadequacyofthesecontrolsandsystemsissubjecttoreviewbytheAC.

The internal auditors conduct annual review of the effectiveness of the Group’s key internal controls, includingfinancial,operationalandcompliancecontrols.Onayearlybasis,theinternalauditorsprepareaninternalauditplanwhichisapprovedbytheAC.TheinternalauditorsupdatetheAContheprogressoftheapprovedinternalauditplaneveryquarterly.TheGroup’sexternalauditors,KPMGLLP,contributeanindependentperspectiveoncertainaspectsoftheinternalcontrolsoverfinancialreportingthroughtheirauditandreporttheirfindingstotheAC.

AnymaterialfindingsfromboththeinternalandexternalauditorstogetherwiththeimprovementrecommendationsarereportedtotheACandmadeknowntotherespectivesubsidiariesforcorrectiveactionstobetaken.TheinternalauditorswillmonitoriftherequiredcorrectivemeasuresareproperlyimplementedbytheManagement.

Inyear2012,theBoardappointedKPMGServicesPteLtdtoconductareviewtofurtherenhancetheGroup’sriskmanagement frameworkoverfinancial,operationalandcompliancerisks.KPMGServicesPteLtdhadalsobeenengaged to assist the Company in formulating and formalising its fraud riskmanagement framework to furtherenhanceitsexistingframeworktopreventimproprieties.TheManagementcontinuedtoadopttheriskmanagementframeworkestablishedinyear2015.Basedontheframeworkestablishedandreportssubmittedbytheexternalandinternalauditors,theBoardopines,withtheconcurrenceoftheAC,thatthereareadequateinternalcontrolsinplacewithintheGroupaddressingmaterialfinancial,operational,complianceandinformationtechnologyrisksandthattheinternalcontrolsandriskmanagementsystemsareeffective.

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CORPORATEGOVERNANCE REPORT

TheBoardhasreceivedassurancefromtheCEOandtheSeniorGroupFinancialControllerthatthefinancialrecordshavebeenproperlymaintainedandthefinancialstatementsgivetrueandfairviewof theCompany’soperationsandfinances,andthattheCompany’sriskmanagementandinternalcontrolsystemsareeffective.TheBoardnotes,however, thatnosystemof internalcontrolcouldprovideabsoluteassuranceagainst theoccurrenceofmaterialerrors,poorjudgmentindecision-making,humanerrors,losses,fraudorotherirregularities.

Principle 13: Internal Audit

TheCompanysetsupitsinternalauditdepartmentsinceJanuary2009afteroutsourcingthefullspectrumofinternalauditworkforthree(3)years.Duringtheyearandsinceyear2011,theCompanyoutsourcedpartofitsinternalauditfunctiontoaprofessionalfirm,NexiaTSRiskAdvisoryPteLtd,tofurtherstrengthenandenhancetheinternalauditfunctionoftheGroup.Theoutsourcedandin-houseinternalauditdepartmentcarriedouttheinternalauditofallthesubsidiariesinChinaandSingapore.InternalauditreportswerepreparedtoupdatetheAContheprogressofallauditscarriedout,therecommendationsacceptedbyManagement,andtotrackthestatusofoutstandingmattersandremedialactionstakentodate.

Principle 10: AccountabilityPrinciple 15: Communication with Shareholders

The Company engages in regular, effective and fair communication with shareholders through announcementsreleasedtoSGXviaSGXNET.Suchannouncementsincludethequarterly,halfyearlyandfullyearresults,materialtransactionsandotherdevelopmentsrelatingtotheGroupwhichrequiredisclosureunderthecorporatedisclosurepolicyofSGX.TheCompanyalsomaintainsawebsiteatwww.fuyucorp.comwherethepubliccanaccessinformationontheGroup.

Whenopportunitiesarise, theDirectorswillsolicitand try tounderstand theviewsofshareholdersbeforeand/oraftergeneralmeetingof theCompany.TheCompany’sCEOandSeniorGroupFinancialControllerwillattend toanalystsandfundmanagerswhowishtoseekabetterunderstandingoftheGroup’soperationswhennecessaryandappropriate.

Two(2)interimdividendshavebeendeclaredandpaidduringtheyear.TheCompanyhasproposedafinaldividendof1.0centperordinaryshareforFY2015subjecttotheshareholders’approvalinthecomingAGM.

TheCompanyhasdecidedonadividendpolicyofdeclaringandproposingatleast50%ofitsprofitafterincometaxattributabletotheownersoftheCompanyasdividends,unless:

(i) anyreinvestmentoftheprofitforcapitalexpenditure,expansionordiversificationpurposesismorethan50%oftheprofit;or

(ii) thereisinsufficientprofitattheCompanylevel;or

(iii) thereisinsufficientfundsattheCompanyleveltopayforthedividends,

under which conditions, any proposed dividends will be decided by the Board taking into account the aboveconditions. Shareholdersareinformedofgeneralmeetingsthroughnoticespublishedinthenewspapersandannualreportsorcircularssenttothem.

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CORPORATEGOVERNANCE REPORT

Principle 14: Shareholder RightsPrinciple 16: Conduct of Shareholder Meetings

TheCompanyencouragesshareholders’participationatgeneralmeetings,andwelcomesshareholderstogivetheirconstructiveviewsonvariousmattersconcerningtheGroup.

Eachitemofspecialbusinessincludedinthenoticeofthemeetingisaccompaniedbyanexplanationfortheproposedresolution.Separateresolutionsareproposedforsubstantiallyseparateissuesatthemeeting.TheChairmenoftheAudit,RemunerationandNominatingCommitteesarenormallyavailableatthemeetingtoanswerthosequestionsrelatingtotheworkofthesecommittees.TheexternalauditorsarealsopresenttoassisttheDirectorsinaddressinganyrelevantqueriesbyshareholders.

TheCompanywillprepare thedetailedAGMminutes,which includecommentsand thequestions received fromshareholders, if any. TheCompanywill bepleased tomake theseminutesavailable toshareholdersupon theirrequest.

TheCompanycommencedthevotingofallitsresolutionsbypollattheExtraordinaryGeneralMeeting(“EGM”)heldon16October2014andwillconductthevotingofallitsresolutionsbypollinallitscomingAGMsandEGMs.TheCompanymayconsideremployingelectronicpollinginfuture.TheCompany’sConstitutionallowashareholdertoappointone(1)ortwo(2)proxiestoattendandvoteatgeneralmeetingsinhis/herstead.Nonetheless,undertherevisedCompaniesAct,arelevantintermediarymayappointmorethantwo(2)proxies,buteachproxymustbeappointedtoexercisetherightsattachedtoadifferentshareorsharesheldbyhim/her(whichnumberandclassofsharesshallbespecified).

TheCompanywillreviewitsConstitutionfromtimetotimeandmakesuchamendmentstotheConstitutiontobeinlinewiththeapplicablerequirementsorrulesandregulationsgoverningthecontinuinglistingobligationintheListingManualofSGX-ST.

CORPORATEGOVERNANCE REPORT

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FINANCIAL STATEMENTSDIRECTORS’STATEMENT 29

INDEPENDENTAUDITORS’REPORT 34

STATEMENTSOFFINANCIALPOSITION 36

CONSOLIDATEDINCOMESTATEMENT 37

CONSOLIDATEDSTATEMENTOFCOMPREHENSIVEINCOME 38

CONSOLIDATEDSTATEMENTOFCHANGESINEQUITY 39

CONSOLIDATEDSTATEMENTOFCASHFLOWS 41

NOTESTOTHEFINANCIALSTATEMENTS 43

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Wearepleasedtosubmitthisannualstatementtothememberstogetherwiththeauditedfinancialstatementsof FuYuCorporationLimited(theCompany)anditssubsidiaries(collectively,theGroup)forthefinancialyearended31December2015.

Inouropinion:

(a) thefinancialstatementssetoutonpages36to91aredrawnupsoastogiveatrueandfairviewofthefinancialpositionoftheGroupandoftheCompanyasat31December2015andthefinancialperformance,changes in equity and cash flows of the Group for the year ended on that date in accordance with theprovisionsoftheSingaporeCompaniesAct,Chapter50andSingaporeFinancialReportingStandards;and

(b) atthedateofthisstatement,therearereasonablegroundstobelievethattheCompanywillbeabletopayitsdebtsasandwhentheyfalldue.

TheBoardofDirectorshas,onthedateofthisstatement,authorisedthesefinancialstatementsforissue.

DIRECTORS

Thedirectorsinofficeatthedateofthisstatementareasfollows:

ChingHengYangTamWaiHoNeeKitHewLienLeeJohnChenSeowPhunTanYewBengFooSayTun

DIRECTORS’ INTERESTS

AccordingtotheregisterkeptbytheCompanyforthepurposesofSection164oftheCompaniesAct,Chapter50(theAct),particularsofinterestsofdirectorswhoheldofficeattheendofthefinancialyear(includingthoseheldbytheirspousesandinfantchildren)inshares,debentures,warrantsandshareoptionsintheCompanyandinrelatedcorporations(otherthanwholly-ownedsubsidiaries)areasfollows:

Name of director and corporation in which interests are held

Holdings at beginning of the year

Holdings at end

of the year

Ching Heng YangFuYuCorporationLimited– ordinaryshares – interestheld 88,965,475 88,965,475

LCTHCorporationBerhad– ordinarysharesofRM0.20each – interestheld – deemedinterests

300,000254,295,643

300,000254,295,643

DIRECTORS’STATEMENT

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DIRECTORS’STATEMENT

Name of director and corporation in which interests are held

Holdings at beginning of the year

Holdings at end

of the year

Ching Heng Yang (cont’d)NanoTechnologyManufacturingPteLtd– ordinaryshares – deemedinterests 14,400,000 14,400,000

Tam WaiFuYuCorporationLimited– ordinaryshares – interestheld – deemedinterests

96,715,475300,000

96,715,475300,000

LCTHCorporationBerhad– ordinarysharesofRM0.20each – interestheld – deemedinterests

366,000254,295,643

366,000254,295,643

NanoTechnologyManufacturingPteLtd– ordinaryshares – deemedinterests 14,400,000 14,400,000

Ho Nee KitFuYuCorporationLimited– ordinaryshares – interestheld 96,999,225 96,999,225

LCTHCorporationBerhad– ordinarysharesofRM0.20each – interestheld – deemedinterests

369,120254,295,643

369,120254,295,643

NanoTechnologyManufacturingPteLtd– ordinaryshares – deemedinterests 14,400,000 14,400,000

Tan Yew BengFuYuCorporationLimited– ordinaryshares – interestheld 2,562,500 2,562,500

LCTHCorporationBerhad– ordinarysharesofRM0.20each – interestheld 300,000 300,000

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DIRECTORS’STATEMENT

Name of director and corporation in which interests are held

Holdings at beginning of the year

Holdings at end

of the year

Hew Lien LeeFuYuCorporationLimited– ordinaryshares – interestheld 8,100,000 8,100,000

LCTHCorporationBerhad– ordinarysharesofRM0.20each – interestheld 3,031,524 3,031,524

John Chen Seow PhunFuYuCorporationLimited– ordinaryshares – interestheld 1,000,000 1,000,000

Foo Say TunFuYuCorporationLimited– ordinaryshares – interestheld 1,000,000 –

ByvirtueofSection7oftheAct,ChingHengYang,TamWaiandHoNeeKitaredeemedtohaveinterestsinsharesofthesubsidiariesoftheCompany,atthebeginningandattheendofthefinancialyear.

Exceptasdisclosedinthisstatement,nodirectorwhoheldofficeattheendofthefinancialyearhadinterestsinshares,debentures,warrantsorshareoptionsoftheCompany,orofrelatedcorporations,eitheratthebeginningorattheendofthefinancialyear.

Therewerenochangesinanyoftheabove-mentionedinterestsintheCompanybetweentheendofthefinancialyearand21January2016.

Neitherattheendof,noratanytimeduringthefinancialyear,wastheCompanyapartytoanyarrangementwhoseobjectsare,oroneofwhoseobjectsis,toenablethedirectorsoftheCompanytoacquirebenefitsbymeansoftheacquisitionofsharesinordebenturesoftheCompanyoranyotherbodycorporate.

SHARE OPTIONS

Duringthefinancialyear,therewere:

(i) nooptionsgrantedbytheCompanytoanypersontotakeupunissuedsharesintheCompany;and

(ii) nosharesissuedbyvirtueofanyexerciseofoptiontotakeupunissuedsharesoftheCompany.

Asattheendofthefinancialyear,therewerenounissuedsharesoftheCompanyunderoption.

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DIRECTORS’STATEMENT

AUDIT COMMITTEE

ThemembersoftheAuditCommitteeduringtheyearandatthedateofthisstatementare:

JohnChenSeowPhun(Chairman),IndependentNon-ExecutiveDirectorTanYewBeng,IndependentNon-ExecutiveDirectorFooSayTun,IndependentNon-ExecutiveDirector

TheAuditCommitteeperformsthefunctionsspecifiedinSection201B(5)oftheAct,theSGXListingManualandtheCodeofCorporateGovernance.

TheAuditCommitteehasheld four (4)meetingsduring thefinancial year. Inperforming its functions, theAuditCommitteemetwiththeCompany’sexternalandinternalauditorstodiscussthescopeoftheirwork,theresultsoftheirexaminationandevaluationoftheCompany’sinternalaccountingcontrolsystem.

TheAuditCommitteealsoreviewedthefollowing:

• assistanceprovidedbytheCompany’sofficerstotheexternalandinternalauditors;

• quarterlyfinancialinformationandannualfinancialstatementsoftheGroupandtheCompanypriortotheirsubmissiontothedirectorsoftheCompanyforadoption;

• interestedpersontransactions(asdefinedinChapter9oftheSGXListingManual);and

• theauditplanoftheGroup’sexternalauditoranditsfindingsarisingfromthestatutoryaudit.

The Audit Committee has full access tomanagement and is given the resources required for it to discharge itsfunctions.Ithasfullauthorityandthediscretiontoinviteanydirectororexecutiveofficertoattenditsmeetings.TheAuditCommitteealsorecommendstheappointmentoftheexternalauditorsandreviewsthelevelofauditandnon-auditfees.

TheAuditCommitteeissatisfiedwiththeindependenceandobjectivityoftheexternalauditorsandhasrecommendedtotheBoardofDirectorsthattheauditors,KPMGLLP,benominatedforre-appointmentasauditorsattheforthcomingAnnualGeneralMeetingoftheCompany.

InappointingourauditorsfortheCompany,subsidiariesandajointventure,wehavecompliedwithRules712and715oftheSGXListingManual.

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DIRECTORS’STATEMENT

AUDITORS

Theauditors,KPMGLLP,haveindicatedtheirwillingnesstoacceptre-appointment.

OnbehalfoftheBoardofDirectors

Ho Nee KitDirector

Hew Lien LeeDirector

31March2016

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INDEPENDENTAUDITORS’ REPORT

Members of the CompanyFu Yu Corporation Limited

REPORT ON THE FINANCIAL STATEMENTS

We have audited the accompanying financial statements of Fu Yu Corporation Limited (the Company) and itssubsidiaries(theGroup),whichcomprisethestatementsoffinancialpositionoftheGroupandoftheCompanyasat31December2015,theincomestatement,statementofcomprehensiveincome,statementofchangesinequityandstatementofcashflowsoftheGroupfortheyearthenended,andasummaryofsignificantaccountingpoliciesandotherexplanatoryinformation,assetoutonpages36to91.

Management’s responsibility for the financial statements

ManagementisresponsibleforthepreparationoffinancialstatementsthatgiveatrueandfairviewinaccordancewiththeprovisionsoftheSingaporeCompaniesAct,Chapter50(theAct)andSingaporeFinancialReportingStandards,and for devising and maintaining a system of internal accounting controls sufficient to provide a reasonableassurance that assets are safeguardedagainst loss fromunauthoriseduse or disposition; and transactionsareproperly authorised and that they are recorded as necessary to permit the preparation of true and fair financialstatementsandtomaintainaccountabilityofassets.

Auditors’ responsibility

Our responsibility is toexpressanopinionon thesefinancialstatementsbasedonouraudit.Weconductedouraudit inaccordancewithSingaporeStandardsonAuditing.Thosestandards require thatwecomplywithethicalrequirementsandplanandperformtheaudittoobtainreasonableassuranceaboutwhetherthefinancialstatementsarefreefrommaterialmisstatement.

Anauditinvolvesperformingprocedurestoobtainauditevidenceabouttheamountsanddisclosuresinthefinancialstatements.Theproceduresselecteddependontheauditor’sjudgement,includingtheassessmentoftherisksofmaterialmisstatementofthefinancialstatements,whetherduetofraudorerror.Inmakingthoseriskassessments,theauditorconsidersinternalcontrolrelevanttotheentity’spreparationofthefinancialstatementsthatgiveatrueandfairviewinordertodesignauditproceduresthatareappropriateinthecircumstances,butnotforthepurposeofexpressinganopinionontheeffectivenessoftheentity’sinternalcontrol.Anauditalsoincludesevaluatingtheappropriatenessofaccountingpoliciesusedandthereasonablenessofaccountingestimatesmadebymanagement,aswellasevaluatingtheoverallpresentationofthefinancialstatements.

Webelievethattheauditevidencewehaveobtainedissufficientandappropriatetoprovideabasisforourauditopinion.

Opinion

Inouropinion, theconsolidatedfinancial statementsof theGroupand thestatementof financialpositionof theCompanyareproperlydrawnupinaccordancewith theprovisionsof theActandSingaporeFinancialReportingStandardssoastogiveatrueandfairviewofthefinancialpositionoftheGroupandoftheCompanyasat31December2015andthefinancialperformance,changesinequityandcashflowsoftheGroupfortheyearendedonthatdate.

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INDEPENDENTAUDITORS’ REPORT

REPORT ON OTHER LEGAL AND REGULATORY REqUIREMENTS

Inouropinion,theaccountingandotherrecordsrequiredbytheActtobekeptbytheCompanyandbythosesubsidiarycorporationsincorporatedinSingaporeofwhichwearetheauditorshavebeenproperlykeptinaccordancewiththeprovisionsoftheAct.

KPMG LLPPublicAccountantsandCharteredAccountants

Singapore31March2016

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Group Company

Note 2015

$’0002014 $’000

2015 $’000

2014 $’000

Non-current assets

Property,plantandequipment 4 52,399 61,394 12,069 12,684

Investmentproperty 5 8,585 10,085 – –

Subsidiaries 6 – – 65,593 69,402

Jointventure 7 2,484 3,106 – –

Deferredtaxassets 8 2,464 1,280 – –

65,932 75,865 77,662 82,086

Current assets

Inventories 9 15,017 17,120 2,517 2,242

Tradeandotherreceivables 10 61,291 79,704 14,011 16,861

Taxrecoverable 70 5 – –

Shortterminvestments 14 3,637 6,052 – –

Cashandcashequivalents 13 102,940 83,329 29,962 18,051

182,955 186,210 46,490 37,154

Total assets 248,887 262,075 124,152 119,240

Equity attributable to equity holders of the Company

Sharecapital 15 102,158 121,176 102,158 121,176

Reserves 16 75,909 53,740 10,817 (13,311)

178,067 174,916 112,975 107,865

Non-controllinginterests 19,677 20,244 – –

Total equity 197,744 195,160 112,975 107,865

Non-current liabilities

Tradeandotherpayables 19 112 787 112 787

Financialliabilities 18 – 12 – –

Deferredtaxliabilities 8 909 370 647 82

1,021 1,169 759 869

Current liabilities

Tradeandotherpayables 19 47,316 62,385 10,418 10,506

Financialliabilities 18 – 1,365 – –

Taxpayable 2,806 1,996 – –

50,122 65,746 10,418 10,506

Total liabilities 51,143 66,915 11,177 11,375

Total equity and liabilities 248,887 262,075 124,152 119,240

STATEMENTS OF FINANCIAL POSITIONAS AT 31 DECEMBER 2015

Theaccompanyingnotesformanintegralpartofthesefinancialstatements.

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CONSOLIDATEDINCOME STATEMENTYEAR ENDED 31 DECEMBER 2015

Note 2015 $’000

2014 $’000

Revenue 20 222,465 254,434

Costofsales (186,992) (223,360)

Gross profit 35,473 31,074

Otherincome 21 9,628 10,604

Sellingandadministrativeexpenses (29,488) (29,193)

Otheroperatingincome,net 22 2,403 1,490

Resultsfromoperatingactivities 18,016 13,975

Financecosts 23 (11) (153)

Shareofprofit/(loss)ofjointventure(netoftax) 7 432 (405)

Profit before income tax 24 18,437 13,417

Taxexpense 25 (1,755) (2,179)

Profit for the year 16,682 11,238

Profit for the year attributable to:

OwnersoftheCompany 14,070 9,951

Non-controllinginterests 2,612 1,287

Profit for the year 16,682 11,238

Earnings per share

Basicanddilutedearningspershare 26 1.87cents 1.35cents

Theaccompanyingnotesformanintegralpartofthesefinancialstatements.

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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOMEYEAR ENDED 31 DECEMBER 2015

2015 $’000

2014 $’000

Profit for the year 16,682 11,238

Other comprehensive incomeItems that are or may be reclassified subsequently to profit or

loss:

Foreigncurrencytranslationdifferencesforforeignoperations (6,220) (393)

Other comprehensive income for the year (net of tax) (6,220) (393)

Total comprehensive income for the year 10,462 10,845

Total comprehensive income attributable to:

OwnersoftheCompany 10,681 9,969

Non-controllinginterests (219) 876

Total comprehensive income for the year 10,462 10,845

Theaccompanyingnotesformanintegralpartofthesefinancialstatements.

39

FU YU CORPO

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UAL REPORT 2015

CONSOLIDATED STATEMENT OF CHANGES IN EQUITYYEAR ENDED 31 DECEMBER 2015

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40

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

CONSOLIDATED STATEMENT OF CHANGES IN EQUITYYEAR ENDED 31 DECEMBER 2015

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41

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

CONSOLIDATED STATEMENT OF CASH FLOWSYEAR ENDED 31 DECEMBER 2015

Note 2015 $’000

2014 $’000

Cash flows from operating activities

Profitbeforeincometax 18,437 13,417

Adjustmentsfor:

Depreciationofproperty,plantandequipmentandinvestmentproperty 4,5 13,769 17,930

Gainonliquidationofsubsidiary 21 (393) –

Financecosts 23 11 153

Interestincome 21 (1,805) (1,352)

Gainondisposalofproperty,plantandequipment 21 (483) (821)

Impairmentlossonproperty,plantandequipment 22 – 500

Property,plantandequipmentwrittenoff 22 157 279

Shareof(profit)/lossofjointventure(netoftax) 7 (432) 405

Unrealisedforeignexchangeloss/(gain) 1,702 (748)

30,963 29,763

Changesinworkingcapital:

Inventories 1,815 1,510

Tradeandotherreceivables 18,412 (664)

Tradeandotherpayables (14,009) (6,171)

Cashfromoperatingactivities 37,181 24,438

Taxpaid (3,002) (1,057)

Net cash from operating activities 34,179 23,381

Cash flows from investing activities

Dividendsfromjointventure 7 667 496

Interestincomereceived 1,805 1,352

Proceedsfromdisposalofproperty,plantandequipment 545 1,833

Purchaseofproperty,plantandequipment (6,327) (14,499)

Withdrawal/(Placement)ofshortterminvestments 1,743 (2,299)

Net cash used in investing activities (1,567) (13,117)

Balancecarriedforward 32,612 10,264

Theaccompanyingnotesformanintegralpartofthesefinancialstatements.

42

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

Note 2015 $’000

2014 $’000

Balancebroughtforward 32,612 10,264

Cash flows from financing activities

Financecostspaid (11) (153)

Proceedsfromissueofsharecapital – 1,814

Proceedsfromshorttermborrowings 1,106 12,270

Repaymentofshorttermborrowingsandfinanceleaseliabilities (2,520) (14,305)

Dividendspaidtonon-controllinginterestsofasubsidiary 31 (348) –

DividendspaidtoownersoftheCompany 31 (3,765) –

Capitalreduction 15 (3,765) –

Deposits(pledged)/discharged (27) 586

Net cash (used in)/from financing activities (9,330) 212

Net increase in cash and cash equivalents 23,282 10,476

Cashandcashequivalentsat1January 79,921 69,115

Effectofexchangeratefluctuationsoncashheld (3,264) 330

Cash and cash equivalents at 31 December 13 99,939 79,921

CONSOLIDATED STATEMENT OF CASH FLOWSYEAR ENDED 31 DECEMBER 2015

Theaccompanyingnotesformanintegralpartofthesefinancialstatements.

43

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

Thesenotesformanintegralpartofthefinancialstatements.

ThefinancialstatementswereauthorisedforissuebytheBoardofDirectorson31March2016.

1 DOMICILE AND ACTIvITIES

FuYuCorporationLimited(theCompany)isincorporatedintheRepublicofSingaporeandhasitsregisteredofficeat8TuasDrive1,Singapore638675.TheCompanyislistedonSingaporeExchange.

Theprincipalactivitiesof theCompanyare thoseofmanufacturingandsub-assemblyofprecisionplasticparts and components, fabrication of precision moulds and dies and investment holding. The principalactivitiesoftheCompany’ssubsidiariesconsistofmanufacturingandsub-assemblyofprecisionplasticpartsandcomponents,fabricationofprecisionmouldsanddies,trading,provisionofmanagementservicesandinvestmentholding.

TheconsolidatedfinancialstatementsrelatetotheCompanyanditssubsidiariesandtheGroup’sinterestsinajointventure.

2 BASIS OF PREPARATION

2.1 Statement of compliance

ThefinancialstatementshavebeenpreparedinaccordancewiththeSingaporeFinancialReportingStandards(FRS).

2.2 Basis of measurement

Thefinancialstatementshavebeenpreparedonthehistoricalcostbasisexceptforcertainfinancialassetsandliabilitieswhicharemeasuredatfairvalueoramortisedcost.

2.3 Functional and presentation currency

The financial statementsarepresented inSingaporedollarswhich is theCompany’s functional currency.AllfinancialinformationpresentedinSingaporedollarshavebeenroundedtothenearestthousand,unlessotherwisestated.

2.4 Use of estimates and judgements

ThepreparationoffinancialstatementsinconformitywithFRSrequiresmanagementtomakejudgements,estimatesandassumptions thataffect theapplicationofaccountingpoliciesand thereportedamountsofassets,liabilities,incomeandexpenses.Actualresultsmaydifferfromtheseestimates.

Estimatesandunderlyingassumptionsarereviewedonanongoingbasis.Revisionstoaccountingestimates

arerecognisedintheperiodinwhichtheestimateisrevisedandinanyfutureperiodsaffected.

44

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

2 BASIS OF PREPARATION(cont’d)

2.4 Use of estimates and judgements(cont’d)

Informationaboutsignificantareasofestimationuncertainties thathaveasignificantriskof resulting inamaterialadjustmentwithinthenextfinancialyearareincludedinthefollowingnotes:

• Notes3.7and28– allowanceforimpairmentofdoubtfulreceivables

• Notes3.7and4 – measurementofrecoverableamountsofproperty,plantandequipment

• Notes6and11 – recoverabilityofinvestmentsinandamountsduefromsubsidiaries

• Notes8and25 – provisionforincometaxandrecoverabilityofdeferredtaxassets

Informationaboutcriticaljudgementsinapplyingaccountingpoliciesthathavethemostsignificanteffectontheamountsrecognisedinthefinancialstatementsisincludedinthefollowingnote:

• Note5 – classificationofinvestmentproperty

Measurement of fair values

AnumberoftheGroup’saccountingpoliciesanddisclosuresrequirethemeasurementoffairvalues,forbothfinancialandnon-financialassetsandliabilities.

Whenmeasuringthefairvalueofanassetoraliability,theGroupusesmarketobservabledataasfaraspossible.Fairvaluesarecategorisedintodifferentlevelsinafairvaluehierarchybasedontheinputsusedinthevaluationtechniquesasfollows:

• Level1:quotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilities.

• Level2:inputsotherthanquotedpricesincludedinLevel1thatareobservablefortheassetorliability,eitherdirectly(i.e.asprices)orindirectly(i.e.derivedfromprices).

• Level3:inputsfortheassetorliabilitythatarenotbasedonobservablemarketdata(unobservableinputs).

Furtherinformationabouttheassumptionsmadeinmeasuringfairvaluesisincludedinthefollowingnotes:

• Note4 – property,plantandequipment

• Note5 – investmentproperty

• Note28 – financialriskmanagement

Iftheinputsusedtomeasurethefairvalueofanassetoraliabilitymightbecategorisedindifferentlevelsofthefairvaluehierarchy,thenthefairvaluemeasurementiscategorisedinitsentiretyinthesamelevelofthefairvaluehierarchyasthelowestlevelinputthatissignificanttotheentiremeasurement(withLevel3beingthelowest).

45

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES

Theaccountingpoliciessetoutbelowhavebeenappliedconsistentlytoallperiodspresentedinthesefinancialstatements,andhavebeenappliedconsistentlybyGroupentities.

3.1 Foreign currency

(i) Foreigncurrencytransactions

TransactionsinforeigncurrenciesaretranslatedtotherespectivefunctionalcurrenciesofGroupentitiesat theexchangeratesat thedatesof thetransactions.Monetaryassetsandliabilitiesdenominatedinforeigncurrenciesattheendofthereportingperiodareretranslatedtothefunctionalcurrencyattheexchangerateatthatdate.Theforeigncurrencygainorlossonmonetaryitemsisthedifferencebetweenamortisedcostinthefunctionalcurrencyatthebeginningoftheyear,adjustedforeffectiveinterestandpaymentsduringtheyear,andtheamortisedcost inforeigncurrencytranslatedat theexchangerateattheendoftheyear.

Non-monetaryassetsandliabilitiesdenominatedinforeigncurrenciesthataremeasuredatfairvaluearetranslatedtothefunctionalcurrencyattheexchangerateatthedateonwhichthefairvaluewasdetermined.Non-monetaryitemsinaforeigncurrencythataremeasuredintermsofhistoricalcostaretranslatedusingtheexchangerateatthedateofthetransaction.Foreigncurrencydifferencesarisingontranslationarerecognisedinprofitorloss.

(ii) Foreignoperations

Theassetsand liabilitiesof foreignoperations,excludinggoodwilland fairvalueadjustments,aretranslatedtoSingaporedollarsatexchangeratesat theendof thereportingdate.TheincomeandexpensesofforeignoperationsaretranslatedtoSingaporedollarsataverageexchangeratesfortheyear,whichapproximatestheexchangeratesatthedatesofthetransactions.Goodwillandfairvalueadjustmentsarisingontheacquisitionofaforeignoperationonorafter1January2005aretreatedasassetsandliabilitiesoftheforeignoperationandtranslatedattheclosingrate.Foracquisitionspriorto1January2005,theexchangeratesatthedateofacquisitionwereused.

Foreign currencydifferencesare recognised in other comprehensive income, andpresented in theforeigncurrencytranslationreserveinequity.However,iftheforeignoperationisanonwholly-ownedsubsidiary,thentherelevantproportionateshareofthetranslationdifferenceisallocatedtothenon-controllinginterests.Whenaforeignoperationisdisposedofsuchthatcontrolorsignificantinfluenceislost,thecumulativeamountintheforeigncurrencytranslationreserverelatedtothatforeignoperationisreclassifiedtoprofitorlossaspartofgainorlossondisposal.

WhentheGroupdisposesofonlypartofitsinterestinasubsidiarythatincludesaforeignoperationwhileretainingcontrol,therelevantproportionofthecumulativeamountisreattributedtonon-controllinginterests.WhentheGroupdisposesofonlypartofitsinvestmentinanassociateorjointventurethatincludesaforeignoperationwhileretainingsignificantinfluenceorjointcontrol,therelevantproportionofthecumulativeamountisreclassifiedtoprofitorloss.

46

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.1 Foreign currency(cont’d)

(ii) Foreignoperations(cont’d)

Whenthesettlementofamonetaryitemreceivablefromorpayabletoaforeignoperationisneitherplannednor likely in the foreseeable future, foreignexchangegainsand lossesarising fromsuchamonetary itemareconsidered to formpartofanet investment ina foreignoperation.Thesearerecognised in other comprehensive income, and are presented in the foreign currency translationreserve.

3.2 Basis of consolidation

(i) Businesscombinations

BusinesscombinationsareaccountedforusingtheacquisitionmethodinaccordancewithFRS103BusinessCombinationsasattheacquisitiondate,whichisthedateonwhichcontrolistransferredtotheGroup.Controlisthepowertogovernthefinancialandoperatingpoliciesofanentitysoastoobtainbenefitsfromitsactivities.Inassessingcontrol, theGrouptakesintoconsiderationpotentialvotingrightsthatarecurrentlyexercisable.

The consideration transferred does not include amounts related to the settlement of pre-existingrelationships.Suchamountsaregenerallyrecognisedinprofitorloss.

Costsrelatedtotheacquisition,otherthanthoseassociatedwiththeissueofdebtorequitysecurities,thattheGroupincursinconnectionwithabusinesscombinationareexpensedasincurred.

Anycontingentconsiderationpayableisrecognisedatfairvalueattheacquisitiondate.Ifthecontingentconsiderationisclassifiedasequity,itisnotremeasuredandsettlementisaccountedforwithinequity.Otherwise,subsequentchangestothefairvalueofthecontingentconsiderationarerecognisedinprofitorloss.

For non-controlling interests that are present ownership interests and entitle their holders to aproportionate share of the acquiree’s net assets in the event of liquidation, theGroup elects onatransaction-by-transaction basis whether to measure them at fair value, or at the non-controllinginterests’proportionateshareoftherecognisedamountsoftheacquiree’sidentifiablenetassets,attheacquisitiondate.Allothernon-controllinginterestsaremeasuredatacquisition-datefairvalueor,whenapplicable,onthemeasurementbasisspecifiedinanotherFRS.

Whenshare-basedpaymentawards(replacementawards)arerequiredtobeexchangedforawardsheldbytheacquiree’semployees(acquiree’sawards)andrelatetopastservices,thenalloraportionof the amount of the acquirer’s replacement awards is included in measuring the considerationtransferredinthebusinesscombination.Thisdeterminationisbasedonthemarket-basedvalueofthereplacementawardscomparedwiththemarket-basedvalueoftheacquiree’sawardsandtheextenttowhichthereplacementawardsrelatetopastand/orfutureservice.

47

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.2 Basis of consolidation(cont’d)

(ii) Subsidiaries

SubsidiariesareentitiescontrolledbytheGroup.TheGroupcontrolsanentitywhenitisexposedto,orhasrightsto,variablereturnsfromitsinvolvementwiththeentityandhastheabilitytoaffectthosereturnsthroughitspowerovertheentity.Thefinancialstatementsofsubsidiariesareincludedintheconsolidatedfinancialstatements from thedate thatcontrolcommencesuntil thedate thatcontrolceases.

TheaccountingpoliciesofsubsidiarieshavebeenchangedwhennecessarytoalignthemwiththepoliciesadoptedbytheGroup.Lossesapplicabletothenon-controllinginterestsinasubsidiaryareallocatedtothenon-controllinginterestsevenifdoingsocausesthenon-controllingintereststohaveadeficitbalance.

(iii) Lossofcontrol

Upon the loss of control, theGroup derecognises the assets and liabilities of the subsidiary, anynon-controllinginterestsandtheothercomponentsofequityrelatedtothesubsidiary.Anysurplusordeficitarisingonthelossofcontrolisrecognisedinprofitorloss.IftheGroupretainsanyinterestintheprevioussubsidiary,thensuchinterestismeasuredatfairvalueatthedatethatcontrolislost.Subsequently,itisaccountedforasanequity-accountedinvesteeorasanavailable-for-salefinancialassetdependingonthelevelofinfluenceretained.

(iv) Investmentinjointventures

AjointventureisanarrangementinwhichtheGrouphasjointcontrol,wherebytheGrouphasrightstothenetassetsofthearrangement,ratherthanrightstoitsassetsandobligationsforitsliabilities.

Investmentsinjointventuresisaccountedforusingtheequitymethodandisrecognisedinitiallyatcost.Thecostoftheinvestmentsincludestransactioncosts.

TheconsolidatedfinancialstatementsincludetheGroup’sshareofprofitorlossandothercomprehensiveincomeofthejointventure,afteradjustmentstoaligntheaccountingpoliciesofthejointventurewiththoseoftheGroup,fromthedatethatjointcontrolcommencesuntilthedatethatjointcontrolceases.

WhentheGroup’sshareoflossesexceedsitsinterestintheequity-accountedjointventure,thecarryingamountofthatinterest,includinganylong-terminvestments,isreducedtozero,andtherecognitionof further losses isdiscontinuedexcept to the extent that theGrouphasanobligation to fund theinvestee’soperationsorhasmadepaymentsonbehalfoftheinvestee.

48

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.2 Basis of consolidation(cont’d)

(v) Transactionseliminatedonconsolidation

Intra-groupbalancesandtransactions,andanyunrealisedincomeandexpensesarisingfromintra-group transactions, are eliminated in preparing the consolidated financial statements. UnrealisedgainsarisingfromtransactionswithajointventureareeliminatedagainsttheinvestmenttotheextentoftheGroup’sinterestintheinvestee.Unrealisedlossesareeliminatedinthesamewayasunrealisedgains,butonlytotheextentthatthereisnoevidenceofimpairment.

(vi) Accountingforsubsidiariesandjointventuresintheseparatefinancialstatements

Investments in subsidiaries and joint ventures are stated in the Company’s statement of financialpositionatcostlessaccumulatedimpairmentlosses.

3.3 Property, plant and equipment

Itemsofproperty,plantandequipmentaremeasuredatcostlessaccumulateddepreciationandaccumulatedimpairmentlossesexceptthatcertainitemsofleaseholdpropertyweresubjecttoone-offrevaluationconductedin1994.Anyrelatedrevaluationreserveistransferredtoaccumulatedprofitsuponthedisposalofanitemoftheproperty,plantandequipment.

Whenpartsofanitemofproperty,plantandequipmenthavedifferentusefullives,theyareaccountedforasseparateitems(majorcomponents)ofproperty,plantandequipment.

Thegainorlossondisposalofanitemofproperty,plantandequipmentisdeterminedbycomparingtheproceedsfromdisposalwiththecarryingamountofproperty,plantandequipment,andisrecognisednetwithinotherincome/otheroperatingexpensesinprofitorloss.

Thecostofreplacingacomponentofanitemofproperty,plantandequipmentisrecognisedinthecarryingamountof the itemif it isprobable that the futureeconomicbenefitsembodiedwithin thecomponentwillflowtotheGroupanditscostcanbemeasuredreliably.Thecarryingamountofthereplacedcomponentisderecognised.Thecostsoftheday-to-dayservicingofproperty,plantandequipmentarerecognisedinprofitorlossasincurred.

Depreciationisbasedonthecostofanassetlessitsresidualvalue.Significantcomponentsofindividualassetsareassessedandifacomponenthasausefullifethatisdifferentfromtheremainderofthatasset,thatcomponentisdepreciatedseparately.

Depreciationisrecognisedinprofitor lossonastraight-linebasisovertheestimateduseful livesofeachcomponentofanitemofproperty,plantandequipment.LeasedassetsaredepreciatedovertheshorteroftheleasetermandtheirusefullivesunlessitisreasonablycertainthattheGroupwillobtainownershipbytheendoftheleaseterm.Freeholdlandisnotdepreciated.

49

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.3 Property, plant and equipment(cont’d)

Theestimatedusefullivesforthecurrentandcomparativeperiodsareasfollows:

Leaseholdproperties Overthetermoftherespectiveleasesrangingfrom20to60years

Factoryequipment,plantandmachinery 3to10years

Motorvehicles 5years

Officeequipmentandfurnitureandfittings 3to5years

Otherassets 2to10years

No depreciation is recognised on construction-in-progress. Other assets comprise electrical installations,erectablestores,renovationsandleaseholdimprovements.

Depreciationmethods,usefullivesandresidualvaluesarereviewedattheendofeachreportingperiodandadjustedifappropriate.

3.4 Investment property

Investmentpropertyispropertyheldeithertoearnrentalincomeorcapitalappreciationorforboth,butnotfor sale in theordinarycourseofbusiness,used in theproductionor supplyofgoodsor servicesor foradministrativepurposes. Investmentproperty ismeasuredat coston initial recognitionandsubsequentlycarriedatcostlessaccumulateddepreciationandaccumulatedimpairmentlosses.Costincludesexpenditurethatisdirectlyattributabletotheacquisitionoftheinvestmentproperty.

Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful life of theinvestmentproperty.Theestimatedusefullifeis60years.Thedepreciationmethod,theusefullifeandtheresidualvalueofinvestmentpropertyarereassessedatthereportingdate.

Whentheuseofapropertychangessuchthatitisreclassifiedasproperty,plantandequipment,itscost,accumulateddepreciationandaccumulatedimpairmentlossesatthedateofreclassificationwillbetransferredtoproperty,plantandequipmentforsubsequentaccounting.

3.5 Financial instruments

(i) Non-derivativefinancialassets

TheGroupinitiallyrecognisesloansandreceivablesanddepositsonthedatethattheyareoriginated.Allotherfinancialassets(includingassetsdesignatedatfairvaluethroughprofitorloss)arerecognisedinitiallyonthetradedate,whichisthedatethattheGroupbecomesapartytothecontractualprovisionsoftheinstrument.

The Group derecognises a financial asset when the contractual rights to the cash flows from theassetexpire,orit transferstherightstoreceivethecontractualcashflowsonthefinancialassetina transaction inwhich substantially all the risks and rewards of ownership of the financial assetaretransferred.AnyinterestintransferredfinancialassetsthatiscreatedorretainedbytheGroupisrecognisedasaseparateassetorliability.

50

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.5 Financial instruments(cont’d)

(i) Non-derivativefinancialassets(cont’d)

TheGroupclassifiesnon-derivativefinancialassetsintothefollowingcategories:financialassetsatfairvaluethroughprofitorlossandloansandreceivables.

Financial assets at fair value through profit or loss

Afinancialassetisclassifiedatfairvaluethroughprofitorlossifitisclassifiedasheldfortradingorisdesignatedassuchuponinitialrecognition.FinancialassetsaredesignatedatfairvaluethroughprofitorlossiftheGroupmanagessuchinvestmentsandmakespurchaseandsaledecisionsbasedontheirfairvalueinaccordancewiththeGroup’sinvestmentstrategy.Attributabletransactioncostsarerecognisedinprofitor lossasincurred.Financialassetsat fairvaluethroughprofitor lossaremeasuredat fair value, and changes therein,which takes intoaccount anydividend income,arerecognisedinprofitorloss.

Financialassetsdesignatedatfairvaluethroughprofitorlosscomprisesshortterminvestmentsinmoneymarketfundandtrustfunds.

Loans and receivables

Loansandreceivablesarefinancialassetswithfixedordeterminablepaymentsthatarenotquotedinanactivemarket.Suchassetsare recognised initiallyat fairvalueplusanydirectlyattributabletransactioncosts.Subsequenttoinitialrecognition,loansandreceivablesaremeasuredatamortisedcostusingtheeffectiveinterestmethod,lessanyimpairmentlosses.

Loansandreceivablescomprisecashandcashequivalents,andtradeandotherreceivables.

Cash and cash equivalents

Cash and cash equivalents comprise cash balances and bank deposits. For the purpose of thestatementofcashflows,pledgeddepositsareexcludedwhilstbankoverdraftsthatarerepayableondemandandthatformanintegralpartoftheGroup’scashmanagementareincludedincashandcashequivalents.

(ii) Non-derivativefinancialliabilities

TheGroupinitiallyrecognisesfinancialliabilities(includingliabilitiesdesignatedatfairvaluethroughprofitorloss)onthetradedatewhichisthedatethattheGroupbecomesapartytothecontractualprovisionsoftheinstrument.

The Group derecognises a financial liability when its contractual obligations are discharged orcancelledorexpire.

Financialassetsandliabilitiesareoffsetandthenetamountpresentedinthestatementoffinancialpositionwhen,andonlywhen,theGrouphasalegalrighttooffsettheamountsandintendseithertosettleonanetbasisortorealisetheassetandsettletheliabilitysimultaneously.

51

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.5 Financial instruments(cont’d)

(ii) Non-derivativefinancialliabilities(cont’d)

TheGrouphasthefollowingnon-derivativefinancialliabilities:financialliabilitiesandtradeandotherpayables.

Suchfinancialliabilitiesarerecognisedinitiallyatfairvalueplusanydirectlyattributabletransactioncosts.Subsequenttoinitialrecognition,thesefinancialliabilitiesaremeasuredatamortisedcostusingtheeffectiveinterestmethod.

(iii) Intra-groupfinancialguaranteesintheseparatefinancialstatements

FinancialguaranteesarefinancialinstrumentsissuedbytheGroupthatrequirestheissuertomakespecifiedpaymentstoreimbursetheholderforthelossitincursbecauseaspecifieddebtorfailstomeetpaymentwhendueinaccordancewiththeoriginalormodifiedtermsofadebtinstrument.

Financialguaranteesare recognised initiallyat fair valueandareclassifiedasfinancial liabilities.Subsequenttoinitialmeasurement,thefinancialguaranteesarestatedatthehigheroftheinitialfairvaluelesscumulativeamortisationandtheamountthatwouldberecognisediftheywereaccountedforascontingentliabilities.Whenfinancialguaranteesareterminatedbeforetheiroriginalexpirydate,thecarryingamountofthefinancialguaranteesistransferredtoprofitorloss.

(iv) Sharecapital

Ordinarysharesareclassifiedasequity.Incrementalcostsdirectlyattributabletotheissueofordinarysharesandshareoptionsarerecognisedasadeductionfromequity,netofanytaxeffects.

3.6 Leases

When entities within the Group are lessees of a finance lease

LeasedassetsinwhichtheGroupassumessubstantiallyalltherisksandrewardsofownershipareclassifiedasfinanceleases.Uponinitialrecognition,theleasedassetismeasuredatanamountequaltothelowerofitsfairvalueandthepresentvalueoftheminimumleasepayments.Subsequenttoinitialrecognition,theassetisaccountedforinaccordancewiththeaccountingpolicyapplicabletothatasset.

When entities within the Group are lessees of an operating lease

OtherleasesareoperatingleasesandarenotrecognisedintheGroup’sstatementoffinancialposition.WheretheGrouphastheuseofassetsunderoperatingleases,paymentsmadeundertheleasesarerecognisedinprofitorlossonastraight-linebasisoverthetermofthelease.Leaseincentivesreceivedarerecognisedinprofitorlossasanintegralpartofthetotalleasepaymentsmade.Contingentrentalsarechargedtoprofitorlossintheaccountingperiodinwhichtheyareincurred.

52

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.7 Impairment

Financial assets

A financial asset not carried at fair value through profit or loss, including an interest in a joint venture,isassessedat theendofeach reportingperiod todeterminewhether there isobjectiveevidence that it isimpaired.Afinancialassetisimpairedifobjectiveevidenceindicatesthatalosseventhasoccurredaftertheinitialrecognitionoftheasset,andthatthelosseventhasanegativeeffectontheestimatedfuturecashflowsofthatassetthatcanbeestimatedreliably.

Objective evidence that financial assets are impaired can include default or delinquency by a debtor,restructuringofanamountduetotheGroupontermsthattheGroupwouldnotconsiderotherwise,indicationsthatadebtororissuerwillenterbankruptcy,adversechangesinthepaymentstatusofborrowersorissuersintheGroup,economicconditionsthatcorrelatewithdefaultsorthedisappearanceofanactivemarketforasecurity.

TheGroupconsidersevidenceofimpairmentforreceivablesonaspecificassetlevel.

Animpairmentlossinrespectofafinancialassetmeasuredatamortisedcostiscalculatedasthedifferencebetweenitscarryingamountandthepresentvalueoftheestimatedfuturecashflowsdiscountedattheasset’soriginaleffectiveinterestrate.Lossesarerecognisedinprofitorlossandreflectedinanallowanceaccountagainstloansandreceivables.Interestontheimpairedassetcontinuestoberecognised.WhentheGroupconsidersthattherearenorealisticprospectsofrecoveryoftheasset,therelevantamountsarewrittenoff.Iftheamountofimpairmentlosssubsequentlydecreasesandthedecreasecanberelatedobjectivelytoanevent occurring after the impairment was recognised, then the previously recognised impairment loss isreversedthroughprofitorloss.

Non-financial assets

Thecarryingamountsof theGroup’snon-financialassets,other than inventoriesanddeferred taxassets,arereviewedateachreportingdatetodeterminewhetherthereisanyindicationofimpairment.Ifanysuchindicationexists,thentheasset’srecoverableamountisestimated.Animpairmentlossisrecognisedifthecarryingamount of anasset or its related cash-generatingunit (CGU) exceeds its estimated recoverableamount.

TherecoverableamountofanassetorCGUisthegreaterofitsvalue-in-useanditsfairvaluelesscoststosell.Inassessingvalue-in-use,theestimatedfuturecashflowsarediscountedtotheirpresentvalueusingapre-taxdiscountratethatreflectscurrentmarketassessmentsofthetimevalueofmoneyandtherisksspecifictotheassetorCGU.Forthepurposeofimpairmenttesting,assetsthatcannotbetestedindividuallyaregroupedtogetherintothesmallestgroupofassetsthatgeneratescashinflowsfromcontinuingusethatarelargelyindependentofthecashinflowsofotherassetsorCGU.

TheGroup’scorporateassetsdonotgenerateseparatecashinflowsandareutilisedbymorethanoneCGU.Ifthereisanindicationthatacorporateassetmaybeimpaired,thentherecoverableamountisdeterminedfortheCGUtowhichthecorporateassetbelongs.

53

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.7 Impairment(cont’d)

An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimatedrecoverableamount. Impairment lossesare recognised inprofitor loss. Impairment losses recognised inrespectofCGUsareallocatedtoreducethecarryingamountsoftheassetsintheCGU(groupofCGUs)onaproratabasis.

Impairmentlossesrecognisedinpriorperiodsareassessedateachreportingdateforanyindicationsthatthelosshasdecreasedornolongerexists.Animpairmentlossisreversediftherehasbeenachangeintheestimatesusedtodeterminetherecoverableamount.Animpairmentlossisreversedonlytotheextentthattheasset’scarryingamountdoesnotexceedthecarryingamountthatwouldhavebeendetermined,netofdepreciationoramortisation,ifnoimpairmentlosshadbeenrecognised.

3.8 Inventories

Inventoriesaremeasuredatthelowerofcostandnetrealisablevalue.Thecostofinventoriesisbasedontheweightedaveragecostformulaandincludesexpenditureincurredinacquiringtheinventories,productionorconversioncostsandothercostsincurredinbringingthemtotheirexistinglocationandcondition.Inthecaseofmanufactured inventoriesandwork-in-progress,cost includesanappropriateshareofproductionoverheadsbasedonnormaloperatingcapacity.

Netrealisablevalueistheestimatedsellingpriceintheordinarycourseofbusiness,lesstheestimatedcostsofcompletionandsellingexpenses.

3.9 Employee benefits

Defined contribution plans

Adefinedcontributionplanisapost-employmentbenefitplanunderwhichanentitypaysfixedcontributionsintoaseparateentityandwillhavenolegalorconstructiveobligationtopayfurtheramounts.

Obligationsforcontributionstodefinedcontributionpensionplansarerecognisedasanexpenseinprofitorlossintheperiodsduringwhichservicesarerenderedbyemployees.

Short-term benefits

Short-termemployeebenefitobligationsaremeasuredonanundiscountedbasisandareexpensedastherelatedserviceisprovided.

Aliabilityisrecognisedfortheamountexpectedtobepaidundershort-termcashbonusiftheGrouphasapresent legal or constructiveobligation topay this amount asa result of past serviceprovidedby theemployeeandtheobligationcanbeestimatedreliably.

54

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.9 Employee benefits(cont’d)

Share-based payment transactions

TheshareoptionprogrammeallowsGroupemployeestoacquiresharesoftheCompany.Thefairvalueofoptionsgranted is recognisedasanemployeeexpensewithacorresponding increase inequity. The fairvalue ismeasuredatgrantdateandspreadover thevestingperiodduringwhich theemployeesbecomeunconditionallyentitledtotheoptions.Ateachreportingdate,theGrouprevisesitsestimatesofthenumberofoptionsthatareexpectedtobecomeexercisable.Itrecognisestheimpactoftherevisionoforiginalestimatesinemployeeexpenseandinacorrespondingadjustmenttoequityovertheremainingvestingperiod.

Theproceedsreceivednetofanydirectlyattributabletransactionscostsarecreditedtosharecapitalwhentheoptionsareexercised.

3.10 Provisions

Aprovisionisrecognisedif,asaresultofapastevent,theGrouphasapresentlegalorconstructiveobligationthatcanbeestimatedreliablyanditisprobablethatanoutflowofeconomicbenefitswillberequiredtosettletheobligation.Provisionsaredeterminedbydiscounting theexpected future cashflowsatapre-tax ratethatreflectscurrentmarketassessmentsofthetimevalueofmoneyandtherisksspecifictotheliability.Theunwindingofthediscountisrecognisedasfinancecost.

3.11 Revenue recognition

Sale of goods

Revenuefromthesaleofgoodsismeasuredatthefairvalueoftheconsiderationreceivedorreceivable,netofreturns,tradediscountsandvolumerebates.Revenueisrecognisedwhenthesignificantrisksandrewardsofownershiphavebeentransferredtothecustomer,recoveryoftheconsiderationisprobable,theassociatedcostsandpossiblereturnofgoodscanbeestimatedreliably,thereisnocontinuingmanagementinvolvementwiththegoods,andtheamountofrevenuecanbemeasuredreliably.

Transfersofrisksandrewardsvarydependingontheindividualtermsofthesalesagreement.Forsalesofproducts, transferusuallyoccurswhentheproduct isreceivedat thecustomer’swarehouse.However, forsomeinternationalshipments,transferoccursuponloadingofthegoodsontotherelevantcarrier.

Tooling contracts

Toolingrevenueandcostsarerecognisedasrevenueandexpenses,respectively,byreferencetothestageof completionof thecontractactivityat the reportingdate. Thepercentageof completion ismeasuredbyreferencetothestageandprogressofworkperformed,basedonrecordsmaintainedbythedivisions.Anexpectedlossontheconstructioncontractisrecognisedasanexpensewhenitisprobablethattotalcostswillexceedtotalcontractrevenue.

Toolingcontractsinprogressrepresentthegrossunbilledamountexpectedtobecollectedfromcustomersforcontractworkperformedtodate.Itismeasuredatcostplusprofitrecognisedtodatelessprogressbillingsandrecognisedlosses.CostincludesallexpenditurerelateddirectlytospecificprojectsandanallocationoffixedandvariableoverheadsincurredintheGroup’scontractactivitiesbasedonnormaloperatingcapacity.

55

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.11 Revenue recognition(cont’d)

Tooling contracts(cont’d)

Whenthetotalcostsincurredontoolingcontractsplusrecognisedprofits(lessrecognisedlosses)exceedprogressbillings,thebalanceisclassifiedasamountduefromcustomersforcontractwork.Whenprogressbillingsexceedcostsincurredplusrecognisedprofits(lessrecognisedlosses),thebalanceisclassifiedasamountduetocustomersforcontractwork.

Rental income

Rentalincomereceivableunderoperatingleasesisrecognisedinprofitorlossonastraight-linebasisoverthetermofthelease.Leaseincentivesgrantedarerecognisedasanintegralpartofthetotalrentalincomeoverthetermofthelease.Rentalincomefromsubleasedpropertyisrecognisedasotherincome.

3.12 Finance costs

Financecostscompriseinterestexpenseonborrowingsandfinanceleases.Allborrowingcostsarerecognisedinprofitor lossusing theeffective interestmethod,except to theextent that theyarecapitalisedasbeingdirectly attributable to the acquisition, construction or production of an asset which necessarily takes asubstantialperiodoftimetobepreparedforitsintendeduseorsale.

3.13 Other operating income/expense

Otheroperatingexpenseincludesimpairmentlossforproperty,plantandequipment,plantandequipmentwrittenoffandallowancefordoubtfulreceivables.Foreigncurrencygainsandlossesonfinancialassetsandfinancialliabilitiesarereportedonanetbasisaseitherotheroperatingincomeorotheroperatingexpensedependingonwhetherforeigncurrencymovementsareinanetgainornetlossposition.

3.14 Government grants

Governmentgrantsare recognisedwhen there is reasonableassurance that theywillbe receivedand theGroupwillcomplywiththeconditionsassociatedwiththegrant.Asset-relatedgrantsareinitiallyrecognisedasdeferredincomeandsubsequentlyrecognisedinprofitorlossasotherincomeonasystematicbasisovertheusefullifeoftheasset.GrantsthatcompensatetheGroupforexpensesincurredarerecognisedinprofitorlossasotherincomeonasystematicbasisinthesameperiodsinwhichtheexpensesarerecognised.

3.15 Tax

Taxexpensecomprisescurrentanddeferredtax.Currentanddeferredtaxisrecognisedinprofitorlossexcepttotheextentthatitrelatestoitemsrecogniseddirectlyinequityorinothercomprehensiveincome.

Currenttaxistheexpectedtaxpayableorrecoverableonthetaxableincomeorlossfortheyear,usingtaxratesenactedorsubstantivelyenactedatthereportingdate,andanyadjustmenttotaxpayableinrespectofpreviousyears.

56

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.15 Tax(cont’d)

Deferredtaxisrecognisedinrespectoftemporarydifferencesbetweenthecarryingamountsofassetsandliabilitiesforfinancialreportingpurposesandtheamountsusedfor taxationpurposes.Deferredtaxisnotrecognisedforthefollowing:

• temporarydifferenceson the initial recognitionofassetsor liabilities ina transaction that isnotabusinesscombinationandthataffectsneitheraccountingnortaxableprofitorloss;

• temporarydifferencesrelatedtoinvestmentsinsubsidiariestotheextentthatitisprobablethattheywillnotreverseintheforeseeablefuture;and

• taxabletemporarydifferencesarisingontheinitialrecognitionofgoodwill.

Deferredtaxismeasuredatthetaxratesthatareexpectedtobeappliedtotemporarydifferenceswhentheyreverse,basedonthelawsthathavebeenenactedorsubstantivelyenactedbythereportingdate.

Deferredtaxassetsandliabilitiesareoffsetifthereisalegallyenforceablerighttooffsetcurrenttaxliabilitiesandassets,andtheyrelatetoincometaxesleviedbythesametaxauthorityonthesametaxableentity,orondifferenttaxentities,buttheyintendtosettlecurrenttaxliabilitiesandassetsonanetbasisortheirtaxassetsandliabilitieswillberealisedsimultaneously.

Adeferredtaxassetisrecognisedforunusedtaxlosses,taxcreditsanddeductibletemporarydifferences,totheextentthatitisprobablethatfuturetaxableprofitswillbeavailableagainstwhichtheycanbeutilised.Deferred taxassetsare reviewedateach reportingdateandare reduced to theextent that it isno longerprobablethattherelatedtaxbenefitwillberealised.

In the ordinary course of business, there are many transactions and calculations for which the ultimatetax treatment is uncertain. Therefore, the Group recognises tax liabilities based on estimates of whetheradditionaltaxesandinterestwillbedue.ThesetaxliabilitiesarerecognisedwhentheGroupbelievesthatcertainpositionsmaynotbefullysustaineduponreviewbytaxauthorities,despitetheGroup’sbeliefthatitstaxreturnpositionsaresupportable.TheGroupbelievesthatitsaccrualsfortaxliabilitiesareadequateforallopentaxyearsbasedonitsassessmentofmanyfactorsincludinginterpretationsoftaxlawandpriorexperience.Thisassessmentreliesonestimatesandassumptionsandmayinvolveaseriesofmultifaceted

judgmentsabout futureevents.New informationmaybecomeavailable thatcauses theGroup tochangeitsjudgmentregardingtheadequacyofexistingtaxliabilities,suchchangestotaxliabilitieswillimpacttaxexpenseintheperiodthatsuchadeterminationismade.

3.16 Earnings per share

TheGrouppresentsbasicanddilutedearningspershare(EPS)dataforitsordinaryshares.BasicEPSiscalculatedbydividingtheprofitorlossattributabletoordinaryshareholdersoftheCompanybytheweightedaveragenumberofordinarysharesoutstandingduringtheyear,adjustedforownsharesheld.DilutedEPSisdeterminedbyadjustingtheprofitor lossattributable toordinaryshareholdersof theCompanyandtheweightedaveragenumberofordinarysharesoutstanding,adjustedforownsharesheld,fortheeffectsofalldilutivepotentialordinaryshares,whichcompriseshareoptionsgrantedtodirectorsandemployees.

57

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

3 SIGNIFICANT ACCOUNTING POLICIES(cont’d)

3.17 Segment reporting

AnoperatingsegmentisacomponentoftheGroupthatengagesinbusinessactivitiesfromwhichitmayearnrevenueandincurexpenses,includingrevenueandexpensesthatrelatetotransactionswithanyoftheGroup’sothercomponents.Alloperatingsegment’soperatingresultsarereviewedregularlybytheGroup’sBoard of Directors to make decisions about resources to be allocated to the segment and to assess itsperformance,andforwhichdiscretefinancialinformationisavailable.

SegmentresultsthatarereportedtotheBoardofDirectorsincludeitemsdirectlyattributabletoasegmentaswellasthosethatcanbeallocatedonareasonablebasis.Unallocateditemscomprisemainlyincometaxassetsandliabilities.

3.18 New standards and interpretations not adopted

Anumberofnewstandards,amendmentstostandardsandinterpretationsareeffectiveforannualperiodsbeginningafter1January2015,andhavenotbeenapplied inpreparing thesefinancialstatements.TheGroupiscurrentlyassessingthepotentialimpactofadoptingthesenewstandardsandinterpretations,onthefinancialstatementsoftheGroupandtheCompany.

Thesenewstandardsinclude,amongothers,FRS115RevenuefromContractswithCustomersandFRS109FinancialInstrumentswhicharemandatoryforadoptionbytheGroupon1January2018.

• FRS115RevenuefromContractswithCustomers FRS 115 establishes a comprehensive framework for determining whether, how much and when

revenueisrecognised.Italsointroducesnewcostguidancewhichrequirescertaincostsofobtainingand fulfillingcontracts tobe recognisedasseparateassetswhenspecifiedcriteriaaremet.Wheneffective,FRS115replacesexistingrevenuerecognitionguidance,includingFRS18Revenue,FRS11ConstructionContracts,INTFRS113CustomerLoyaltyProgrammes,INTFRS115AgreementsfortheConstructionofRealEstate,INTFRS118TransfersofAssetsfromCustomersandINTFRS31Revenue–BarterTransactionsInvolvingAdvertisingServices.

• FRS109FinancialInstruments FRS109replacesmostoftheexistingguidanceinFRS39FinancialInstruments:Recognitionand

Measurement.Itincludesrevisedguidanceonclassificationandmeasurementoffinancialinstruments,anewexpectedcredit lossmodel forcalculating impairmentonfinancialassetsandnewgeneralhedgeaccountingrequirements.

As FRS115 and FRS109, when effective,will change the existing accounting standards and guidanceappliedbytheGroupandtheCompanyinaccountingforrevenueandfinancialinstruments.ThesestandardsareexpectedtoberelevanttotheGroupandtheCompany.TheGrouphassetupprojectteamstoassessthepotentialimpactonitsfinancialstatementsandtoimplementthestandards.TheGroupdoesnotplantoadoptthesestandardsearly.

The Accounting Standards Council (ASC) announced on 29 May 2014 that Singapore-incorporatedcompanieslistedontheSingaporeExchange(SGX)willapplynewfinancialreportingframeworkidenticaltotheInternationalFinancialReportingStandards(IFRS)forfinancialyearending31December2018onwards.Singapore-incorporatedcompanieslistedonSGXwillhavetoassesstheimpactofIFRS1:First-timeadoptionofIFRSwhentransitioningtothenewreportingframework.TheGroupiscurrentlyassessingtheimpactoftransitioningtothenewreportingframeworkonitsfinancialstatements.

58

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

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59

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

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60

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

4 PROPERTY, PLANT AND EqUIPMENT(cont’d)

Assets held under finance leases

ThecarryingamountofmotorvehiclesheldunderfinanceleasesfortheGroupwasnil(2014:$16,000).Assetsheldunderfinanceleasearepledgedassecurityfortherelatedfinanceleaseliabilities.

Impairment loss

CertainCGUsinChina,SingaporeandMalaysiacontinuedtoincuroperatinglosseswhereasotherCGUs,whose financial performance had improved, had shown indication that impairment losses which wererecognisedinpriorperiodsmaynolongerexistormayhavedecreased.ThisresultedintheGroupreassessingtherecoverableamountoftheproperty,plantandequipment.

TherecoverableamountsoftheCGUswereestimatedbasedonthehigheroffairvaluelesscosttosellandtheir value-in-use. As the operations of the CGUs located within the same country are similar in nature,therefore theassumptionsused in projecting the value-in-useare disclosedbelowby suchgeographicallocations.

TheapproachtodeterminetherecoverableamountsoftheCGUsiscategorisedasfollows:

• CGUsthatareloss-makingandarenotexpectedtogenerateanyeconomicbenefitsintheperiodofforecast.TherecoverableamountsofsuchCGUshavebeendeterminedbasedonthefairvalueofitsmonetaryassetsandliabilities.

• CGUs that are loss-making but are expected to be able to generate economic benefits throughliquidationof its leaseholdpropertiesandplantandmachineries. The recoverableamountsof theCGUshavebeendeterminedbasedonthefairvaluelesscosttoselloftheassets.Thefairvaluelesscost tosell isbasedonmarketvaluationperformedby independentvaluerswithexperience in thelocationandcategoryofthepropertiesandmachineriesbeingvalued.

• The recoverableamountofallotherCGUshavebeendeterminedbasedon thecalculationof theirvalue-in-usederivedfrommanagement’scashflowsprojectionsfortheseCGUs.

Keyassumptionsusedinthecalculationofthevalue-in-useareasfollows:

China CGU Malaysia CGU

2015 2014 2015#

Value-in-useassumptions:

Averagegrowthrateinrevenue -9%to53% -21%to9% 0%to2%

Numberofyearsprojectedinthediscountedcashflow 5years 5years 5years

Grossprofitmargin 12%to25% 8%to21% 17%

Terminalvalueofproperty,plantandequipment (asa%ofcost) 2% 2% –

Terminalvalueofleaseholdpropertyandplantandmachinery($’000) – – 8,733

Pre-taxdiscountrate 20%to22% 18%to21% 13%

# Fairvaluelesscosttosellapproachwasutilisedin2014.

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UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

4 PROPERTY, PLANT AND EqUIPMENT(cont’d)

Impairment loss(cont’d)

ThegrowthrateintheChinasegmentcanbeexplainedbyforecastedfluctuationsinmarketdemandfromendcustomers.IfanyoftheCGUsisnotabletomeettheforecastedresults,theGroupmayberequiredtorecordadditionalimpairmentloss.Basedontheassessment,additionalimpairmentlossofnil(2014:$500,000)wasrecognised.

In prior year, the recoverable amount of the CGUs based on fair value less cost to sell approach was$1,374,000.Accordingly,impairmentlossof$500,000wasrecorded.

Thefairvaluemeasurementiscategorisedaslevel3underthefairvaluehierarchy(seenote2.4).Detailsofvaluationtechniquesandkeyinputsusedareasfollows:

Type valuation technique Significant unobservable inputs

Longtermleaseholdland ComparisonMethodofValuation

Comparing the property with comparable propertieswhichhavebeensoldorarebeingofferedforsaleandmakingadjustmentsforfactorswhichaffectvaluesuchas locationandaccessibility,marketconditions,size,shapeandterrainofland.

Buildings DepreciatedReplacementCostMethod

Aggregated amount of gross replacement cost of thebuildingsandothersiteworksfromwhichappropriatedeductionsmay thenbemade for theage,condition,economicorfunctionalobsolescenceandenvironmentalfactors.

Plantandmachinery DepreciatedReplacementCostMethod

Aggregated amount of gross replacement cost ofthe plant and machinery, from which appropriatedeductionsmay thenbemade for theage,condition,functionalandtechnologicalobsolescencefactors.

5 INvESTMENT PROPERTYGroup $’000

Cost

At1January2014 11,918

Currencyrealignment (229)

At31December2014 11,689

At1January2015 11,689

Currencyrealignment (1,511)

At31December2015 10,178

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UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

5 INvESTMENT PROPERTY(cont’d)Group $’000

Accumulated depreciation

At1January2014 1,405

Depreciationfortheyear 230

Currencyrealignment (31)

At31December2014 1,604

At1January2015 1,604

Depreciationfortheyear 210

Currencyrealignment (221)

At31December2015 1,593

Carrying amounts

At1January2014 10,513

At31December2014 10,085

At31December2015 8,585

ThebuildingsareleasedtoBerryPlasticsMalaysiaSdnBhd,ajointventureoftheGroup,andathirdparty.

Thefairvalueoftheinvestmentproperty(fairvaluehierarchyoflevel3)asat31December2015amountstoapproximately$9,069,000(2014:$9,878,000)andhasbeendeterminedbasedonvaluationsperformedbyaccreditedindependentvaluerswithrecentexperienceinthelocationandcategoryofinvestmentpropertiesbeingvalued.Thevaluationsarebasedoncomparisonmethodofvaluationandthedepreciatedreplacementcostmethod.Thedepreciatedreplacementcostmethodmakesreferencetothecostofreplacingthebuildingsas newand allowing for depreciation. Key unobservable inputs correspond to replacement costs havingregardtoassetlife,physicaldeterioration,functionalandeconomicobsolescence.Thecomparisonmethodinvolves comparing and adopting recent transactions as a yardstick and sale evidences involving othersimilarpropertiesinthevicinity.TheGrouphasassessedthatthebestuseofitspropertiesdonotdifferfromtheircurrentuse.

TheGrouphascertainleaseholdlandheldtoearnrentalincomeandalsoforownproductionorsupplyofgoodsandadministrativepurposes.Ifaportionofthepropertycannotbesoldorleasedoutseparatelyunderafinancelease,theentirepropertyisclassifiedasinvestmentpropertyonlyiftheportionofthepropertyheldforownuseisinsignificant.Judgementisinvolvedindeterminingtheallocationofinvestmentpropertyandproperty,plantandequipment.

63

FU YU CORPO

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LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

6 SUBSIDIARIESCompany

2015 $’000

2014 $’000

Equityinvestments,atcost 118,820 123,027

Forgivenessofamountsduefromasubsidiary 9,331 9,331

128,151 132,358

Impairmentlosses (98,843) (96,650)

29,308 35,708

Amountsduefromsubsidiaries 48,160 46,406

Impairmentlosses (11,875) (12,712)

36,285 33,694

65,593 69,402

Certainamountsduefromsubsidiarieswere insubstancepartof theshareholders’net investments in theentitiesasthesettlementoftheseamountsareneitherplannednorlikelytooccurintheforeseeablefuture.Accordingly,thesebalancesareclassifiedasquasi-equityinvestmentinsubsidiariesandarestatedatcost.

Impairment loss

CertainsubsidiariesinChinaandSingaporecontinuedtoincuroperatinglosseswhereasothersubsidiaries,whose financial performance had improved, had shown indication that impairment losses which wererecognisedinpriorperiodsmaynolongerexistormayhavedecreased.Accordingly,theCompanyperformedanassessmentoftherecoverableamountofitsinvestmentsinsubsidiariesanditsreceivablesfromthesesubsidiaries.Therecoverableamountsofinvestmentsandreceivablesfromthesesubsidiarieswereestimatedbasedonthehigheroffairvaluelesscosttosellandvalue-in-use.

The approach to determine the recoverable amounts of investments and receivables fromsubsidiaries iscategorisedasfollows:

• Investmentsandreceivablesfromsubsidiariesthatareloss-makingandarenotexpectedtogenerateanyeconomicbenefitsintheperiodofforecast,includinginvestmentsandreceivablesfromsubsidiariesthatareconsideredfor theirpotential liquidation.Therecoverableamountofsuchinvestmentsandreceivables fromsubsidiarieshasbeendetermined tobe the fairvalueof itsmonetaryassetsandliabilities.Forsubsidiariesthatareloss-makingbutexpectedtogenerateeconomicbenefitsthroughliquidationofitsleaseholdpropertiesandplantandmachineries,therecoverableamountshavebeendeterminedbasedonthefairvaluelesscosttoselloftheassets.Detailsonfairvaluemeasurementforproperty,plantandequipmentisdisclosedinnote4.

• Therecoverableamountofinvestmentsandreceivablesfromtheremainingsubsidiarieshavebeendeterminedbasedon the calculationof their value-in-usederived frommanagement’s cash flowsprojections.

Basedonmanagement’sassessment,additionalnetimpairmentlossof$1,356,000(2014:$5,383,000)wasrecognisedinprofitorloss.TherecoverableamountoftheCGUsbasedonfairvaluelesscosttosellapproachwas$37,057,000 (2014:$6,885,000). If any of the subsidiaries is not able to achieve theforecastedresultsandrealisethefairvaluesoftheassetsandliabilities,theCompanywouldberequiredtorecordadditionalimpairmentloss.

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ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

6 SUBSIDIARIES(cont’d)

Themovementsintheallowanceforimpairmentinrespectofinvestmentsinsubsidiariesandamountsduefromsubsidiariesduringtheyearareasfollows:

Company

Note 2015 $’000

2014 $’000

At1January 109,362 96,076

Impairmentlossduringtheyear 1,356 5,383

Transferredfromamountsduefromsubsidiaries 11 – 7,903

At31December 110,718 109,362

Allowanceforimpairmentinrespectofotheramountsduefromsubsidiariesisdisclosedinnote11.

Detailsofthesubsidiariesareasfollows:

Name of companyCountry of incorporation/ Place of business

Effective equity interest held by the Group

2015 %

2014 %

Held by the Company: ChangFuResourcesPteLtd Singapore 100 100FuYuInvestmentPteLtd Singapore 100 100NanoTechnologyManufacturingPteLtd Singapore 80 80SolidMicronTechnologiesPteLtd Singapore 100 100FuYuElectronics(Dongguan)Co.,Ltd. People’sRepublicofChina 100 100FuYuMoulding&Tooling(Dongguan)Co.,Ltd. People’sRepublicofChina 100 100FuYingMoulding&Tooling(Shenzhen)Co.,Ltd.* People’sRepublicofChina – 100FuYuMoulding&Tooling(Suzhou)Co.,Ltd. People’sRepublicofChina 100 100FuYuMoulding&Tooling(Wujiang)Co.,Ltd. People’sRepublicofChina 100 100FuYuMoulding&Tooling(Zhuhai)Co.,Ltd. People’sRepublicofChina 100 100FuYuMoulding&Tooling(Shanghai)Co.,Ltd. People’sRepublicofChina 100 100FuYuInternationalEnterpriseLimited HongKong 100 100FuYuTradingLimited HongKong 100 100

Held through Fu Yu Moulding & Tooling (Shanghai) Co., Ltd.:

FuYuMoulding&Tooling(Chongqing)Co.,Ltd. People’sRepublicofChina 100 100

Held through Fu Yu Investment Pte Ltd:LCTHCorporationBerhad Malaysia 70.64 70.64

Held through LCTH Corporation Berhad:FuHaoManufacturing(M)Sdn.Bhd. Malaysia 70.64 70.64

ClassicAdvantageSdn.Bhd. Malaysia 70.64 70.64

* FuYingMoulding&Tooling(Shenzhen)Co.,Ltdwasliquidatedin2015.

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UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

6 SUBSIDIARIES(cont’d)

KPMGSingaporeistheauditorofallSingapore-incorporatedsubsidiariesotherthanChangFuResourcesPteLtd.OthermemberfirmsofKPMGInternationalareauditorsofsignificantforeign-incorporatedsubsidiariesexceptforLCTHCorporationBerhadanditssubsidiaries,whichareauditedbyErnst&Young,Malaysia.

For thispurpose,asubsidiary isconsideredsignificantasdefinedunder theSingaporeExchangeLimitedListingManual if itsnet tangibleassets represent20%ormoreof theGroup’s consolidatednet tangibleassets,orifitspre-taxprofitsaccountfor20%ormoreoftheGroup’sconsolidatedpre-taxprofits.

ThefollowingsummarisesthefinancialinformationoftheGroup’ssubsidiarieswithmaterialnon-controllinginterest(NCI),basedontheirconsolidatedfinancialstatementspreparedinaccordancewithFRS,modifiedforfairvalueadjustmentsonacquisitionanddifferencesintheGroup’saccountingpolicies.

LCTH Corporation Berhad and its subsidiaries

2015 $’000

Revenue 42,233

Profitfortheyear 8,805

Othercomprehensiveincome –

Total comprehensive income 8,805

AttributabletoNCI:

- Profitfortheyear 2,585

- Othercomprehensiveincome –

- Total comprehensive income 2,585

Non-currentassets 28,096

Currentassets 50,024

Non-currentliabilities (262)

Currentliabilities (9,636)

Net assets 68,222

Net assets attributable to NCI 20,030

Cashflowsfromoperatingactivities 8,212

Cashflowsusedininvestingactivities (287)

Cashflowsusedinfinancingactivities(dividendstoNCI:$348,000) (1,280)

Net increase in cash and cash equivalents 6,645

66

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UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

6 SUBSIDIARIES(cont’d)

LCTH Corporation Berhad and its subsidiaries

2014 $’000

Revenue 48,811

Profitfortheyear 5,028

Othercomprehensiveincome –

Total comprehensive income 5,028

AttributabletoNCI:

- Profitfortheyear 1,476

- Othercomprehensiveincome –

- Total comprehensive income 1,476

Non-currentassets 29,319

Currentassets 53,341

Non-currentliabilities (300)

Currentliabilities (12,112)

Net assets 70,248

Net assets attributable to NCI 20,625

Cashflowsfromoperatingactivities 4,716

Cashflowsusedininvestingactivities (10,940)

Cashflowsusedinfinancingactivities(dividendstoNCI:nil) (14)

Net decrease in cash and cash equivalents (6,238)

7 JOINT vENTURE

ThejointventurecompanyBerryPlasticsMalaysiaSdnBhd’sprincipalactivitiesarethoseofmanufacturingandassemblyofprecisionplasticmouldedproductsforelectrical,electronics,healthcare,foodandpetroleumindustries.Theaccountingmodelappliedisequitymodel.Detailsofthejointventureareasfollows:

Name of companyCountry of incorporation/

Place of business

Effective equity interest held by

the Group

2015 %

2014 %

BerryPlasticsMalaysiaSdnBhd* Malaysia 28.26 28.26

* AuditedbyPricewaterhouseCoopers,Malaysia.

Thejointventureisheldthroughitssubsidiary,LCTHCorporationBerhadwhichhasa40%equityownershipinterestsintheentity.

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NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

7 JOINT vENTURE(cont’d)

Thefollowingtablesummarisesthefinancialinformationofthejointventure,basedonitsfinancialstatementspreparedinaccordancewithFRS,modifiedforfairvalueadjustmentsonacquisitionanddifferencesintheGroup’saccountingpolicies:

2015 $’000

2014 $’000

Revenue 6,625 5,433Profit/(Loss)afterincometax# 1,081 (1,013)Othercomprehensiveincome – –Total comprehensive income 1,081 (1,013)

Assets and liabilitiesNon-currentassets 853 2,807Currentassets^ 6,408 5,986Non-currentliabilities – (441)Currentliabilities (1,051) (587)Net assets 6,210 7,765

Group’s interest in net assets of investee at beginning of the year 3,106 4,064Shareoftotalcomprehensiveincome 432 (405)Dividendsfromjointventure (667) (496)Currencyrealignment (387) (57)Carrying amount of interest in investee at end of the year 2,484 3,106

# Includes:– depreciationof$930,000(2014:$1,275,000)– interestincomeof$34,000(2014:$24,000)– incometaxexpenseof$36,000(2014:creditof$40,000)

^ Includescashandcashequivalentsof$4,969,000(2014:$4,251,000).

8 DEFERRED TAx ASSETS AND LIABILITIES

MovementsindeferredtaxassetsandliabilitiesoftheGroup(priortooffsettingofbalances)duringtheyearareasfollows:

At 1/1/2014

$’000

Recognised in profit or loss

(Note 25) $’000

Exchange differences

$’000

At 31/12/2014

$’000

Recognised in profit or loss

(Note 25) $’000

Exchange differences

$’000

At 31/12/2015

$’000

GroupDeferred tax assetsProperty,plantand

equipment (746) 603 – (143) 143 – –Employeebenefits (29) – – (29) 4 – (25)Others (14) (157) (5) (176) (357) (1) (534)Taxlosscarry-forward (1,469) (794) 71 (2,192) (1,133) 348 (2,977)

(2,258) (348) 66 (2,540) (1,343) 347 (3,536)

Deferred tax liabilitiesProperty,plantand

equipment 1,157 508 (35) 1,630 547 (196) 1,981

68

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UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

8 DEFERRED TAx ASSETS AND LIABILITIES(cont’d)

2015 $’000

2014 $’000

CompanyDeferred tax assets

Employeebenefits (25) (29)

Deferred tax liabilities

Property,plantandequipment 672 111

Deferred taxassetsand liabilitiesareoffsetwhen there isa legallyenforceable right tosetoffcurrent taxassetsagainstcurrenttaxliabilitiesandwhenthedeferredtaxesrelatetothesametaxauthority.Theamountsdeterminedafterappropriateoffsettingareincludedinthestatementoffinancialpositionasfollows:

Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

Deferredtaxassets 2,464 1,280 – –

Deferredtaxliabilities 909 370 647 82

Basedonthecashflowsforecastpreparedasdescribedinnote4,deferredtaxassetswererecognisedbycertainsubsidiariestotheextentthatmanagementconsidereditprobablethatfuturetaxableprofitswouldbeavailableagainstwhichtheunutilisedtaxlossescarriedforwardcanbeutilisedbytheGroup.

Asat31December,deferredtaxassetshavenotbeenrecognisedinrespectofthefollowingitemsbecauseitisnotprobablethatfuturetaxableprofitswouldbeavailableagainstwhichtheGroupcanutilisethebenefitstherefrom:

Group

2015 $’000

2014 $’000

Unutilisedcapitalallowances 464 1,615

Unutilisedtaxlosses 27,432 42,073

Unutilisedexportandreinvestmentallowances 2,978 3,658

Temporarydifferences 2,903 3,705

33,777 51,051

Other than tax lossesarising fromChinasubsidiariesof$18,817,000(2014:$23,477,000)whichwillexpirebetween2016and2020(2014:2015and2019), theremainingtax losses,capitalallowances,exportandreinvestmentallowancesandtemporarydifferencesdonotexpireundercurrent tax legislation.Unutilisedtaxlossesof$8million(2014:$11million)expiredduringthefinancialyear.

Unrecognised temporary differences relating to investments in subsidiaries

Asat31December2015,adeferredtaxliabilityof$232,000(2014:$205,000)fortemporarydifferencesof$4,644,000(2014:$4,096,000)relatedtoundistributedearningsofcertainsubsidiariesoftheGroupwerenotrecognisedastheGrouphasdeterminedthattheundistributedprofitsofitsoverseassubsidiarieswillnotberemittedtoSingaporeinthenext12months,butberetainedforworkingcapitalpurposes.

69

FU YU CORPO

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UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

9 INvENTORIESGroup Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

Rawmaterials 7,009 8,065 1,218 1,315Work-in-progress 527 963 35 55Finishedgoods 7,481 8,092 1,264 872

15,017 17,120 2,517 2,242

Movementsintheallowanceforstockobsolescenceareasfollows:Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

At1January 899 1,900 61 66Allowancemade 432 188 150 –Allowancewritten-back (74) (480) – (5)Allowanceutilised (19) (715) – –Currencyrealignment (53) 6 – –At31December 1,185 899 211 61

Duringtheyear,theamountofinventoriesrecognisedasanexpensefortheGroupandCompanyamountedto$186,992,000(2014:$223,360,000)and$28,738,000(2014:$29,082,000)respectively.

10 TRADE AND OTHER RECEIvABLESGroup Company

Note2015 $’000

2014 $’000

2015 $’000

2014 $’000

Tradereceivables 62,275 76,479 8,831 9,239Allowanceforimpairmentof

doubtfulreceivables (8,025) (7,893) (6) (5)Nettradereceivables 54,250 68,586 8,825 9,234

Otherreceivables 1,030 1,126 198 143Allowanceforimpairmentof

doubtfulotherreceivables (71) (16) (63) (8)Netotherreceivables 959 1,110 135 135

Amountsduefromsubsidiaries 11 – – 3,977 5,351

Deposits 1,445 1,472 458 475Loansandreceivables 56,654 71,168 13,395 15,195Prepayments 670 1,306 81 88Advancestosuppliers 1,083 971 36 108Amountsduefrom

customersforcontractwork 12 2,884 6,259 499 1,470

61,291 79,704 14,011 16,861

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UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

10 TRADE AND OTHER RECEIvABLES(cont’d)

Inprioryear,tradereceivablesofasubsidiarywerepledgedassecurityforbankfacilities(seenote18).Theamountthatissubjecttothepledgeis$1,701,000asat31December2014.

TheGroup’sandtheCompany’sexposuretocreditandcurrencyrisks,andimpairmentlossesrelatedtotradeandotherreceivablesisdisclosedinnote28.

11 AMOUNTS DUE FROM SUBSIDIARIESCompany

Note2015 $’000

2014 $’000

Amountsduefromsubsidiaries–trade 74 70–non-trade 3,903 5,281

10 3,977 5,351

Thenon-tradeamountsduefromsubsidiariesareunsecured,non-interestbearingandrepayableondemand.TheCompany’sexposuretocreditriskisdisclosedinnote28.

Themovements in the allowance for impairment of doubtful receivables in respect of amounts due fromsubsidiariesduringtheyearareasfollows:

Company

Note2015 $’000

2014 $’000

At1January – 7,903Transferredtoquasi-equityinvestments 6 – (7,903)At31December – –

12 AMOUNTS DUE FROM CUSTOMERS FOR CONTRACT WORKGroup Company

Note2015 $’000

2014 $’000

2015 $’000

2014 $’000

Contractcostsincurredtodate 12,089 22,452 3,338 7,602Recognisedprofitsless

recognisedlossestodate 3,416 4,471 153 22815,505 26,923 3,491 7,830

Progressbillings (13,540) (21,294) (3,068) (6,455)Amountsduefromcustomers,

net 1,965 5,629 423 1,375

Grossamountsduefromcustomersforcontractwork 10 2,884 6,259 499 1,470

Grossamountsduetocustomersforcontractwork 19 (919) (630) (76) (95)

1,965 5,629 423 1,375

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UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

13 CASH AND CASH EqUIvALENTS

Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

Cashatbankandinhand 45,729 43,441 6,418 5,201

Depositswithbanks 57,211 39,888 23,544 12,850

Cashandcashequivalents 102,940 83,329 29,962 18,051

Depositspledged (3,001) (3,408)

Cashandcashequivalentsintheconsolidatedstatementofcashflows 99,939 79,921

Fixeddepositsof$3,001,000(2014:$3,408,000)ispledgedforbankguaranteepurposesinthenormalcourseofbusiness.

Fixeddepositswithfinancialinstitutionsmatureonvaryingperiodswithin12months(2014:12months)fromthefinancialyearend.Effectiveinterestratesrangefrom0.3%to4.16%(2014:0.23%to4.05%)perannum.

Cash and bank balances totalling the equivalent of $37,121,000 (2014: $32,113,000) are held in acountrywhichoperatesforeignexchangecontrols.

14 SHORT TERM INvESTMENTS

Theshort term investments refer to fundsdepositedwithquoted trust fundandmoneymarket funds.Theinvestmentsaredesignatedatfairvalueandiscategorisedaslevel1underthefairvaluehierarchy.

15 SHARE CAPITAL2015 2014

No. of shares

Fully paid ordinary shares, with no par value:

Onissueat1January 752,994,775 732,834,775

Exerciseofshareoptions – 20,160,000

Onissueat31December 752,994,775 752,994,775

Duringtheyearended31December2014,ordinarysharesof20,160,000wereissuedasaresultoftheexerciseofvestedshareoptionsarisingfromtheFuYuEmployeesShareOptionSchemegrantedon5October2008.Optionswereexercisedatanexercisepriceof$0.09pershare.Allissuedsharesarefullypaid.

Theholdersofordinarysharesareentitledtoreceivedividendsasdeclaredfromtimetotimeandareentitledtoonevotepershareatmeetingsof theCompany.Allsharesrankequallywithregard to theCompany’sresidualassets.

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15 SHARE CAPITAL(cont’d)

Capital reduction

Duringtheyear,theCompanyundertookacapitalreductionexerciseinvolving:

(i) awriteoffofaccumulatedlossesoftheCompanyamountingto$15,253,773asat31December2014;and

(ii) acashdistributionamountingto$3,764,973toreturnsurpluscapitaltoshareholders.

ThereisnochangeinthenumberofsharesissuedbytheCompanyimmediatelyafterthecapitalreductionexercise.

Capital management

TheGroup’spolicyistomaintainadequatecapitalbasetomaintaininvestor,creditorandmarketconfidenceandtosustainfuturedevelopmentofthebusiness.CapitalconsistsofsharecapitalandreservesoftheGroup.

Managementmonitorscapitalandexternallyimposedcapitalrequirementsbasedonthefollowingbases(fortheGroupandtheCompany)andwillreporttotheBoardonanyexceptionsnoted:

– TotalequityattributabletoequityholdersoftheCompany,excludingrevaluationreserveandforeigncurrencytranslationreserve(“netequity”);and

– Gearingratio

Netequityiscalculatedasthesumofsharecapital,capitalreserve,statutoryreserve,shareoptionreserveandretainedearnings.Gearingratioiscalculatedastotalliabilities(includingcontingentliabilities)dividedbynetequity.

Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

Netequity 187,183 180,643 112,186 107,076

Gearingratio 27.3% 37.0% 10.0% 10.6%

TheGroupandtheCompanyhavecompliedwiththeexternallyimposedcapitalrequirementsforthefinancialyearsended31December2015and2014.

Inaddition,asdisclosedinnote16,subsidiariesinPeople’sRepublicofChina(PRC)arerequiredbythelawsandregulationsofthePRCtocontributetoandtomaintainanon-distributablestatutoryreservefundwhoseutilisationissubjecttoapprovalbyrelevantPRCauthorities.ThisexternallyimposedcapitalrequirementhasbeencompliedwithbythePRCsubsidiariesforthefinancialyearsended31December2015and2014.

TheBoardofDirectorsmonitorsthelevelofdividendstoordinaryshareholders.TherewerenochangesintheGroup’sapproachtocapitalmanagementduringtheyear.

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16 RESERvESGroup Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

Capitalreserve 140 140 – –

Statutoryreserve 6,561 6,073 – –

Revaluationreserve 789 789 789 789

Shareoptionreserve – 1,627 – 1,153

Foreigncurrencytranslationreserve (9,905) (6,516) – –

Retainedearnings/(accumulatedlosses) 78,324 51,627 10,028 (15,253)

75,909 53,740 10,817 (13,311)

Thecapitalreservecomprisesnegativegoodwillarisingfromacquisitionofremaininginterestinasubsidiaryfromnon-controllinginterestswrittenoffagainstshareholder’sequity.

In accordance with the Foreign Enterprise Law applicable to the subsidiaries in the PRC, wholly-ownedsubsidiariesarerequiredtomakeappropriationtostatutoryreservefund(SRF).Atleast10%ofthestatutoryaftertaxprofitsasdeterminedinaccordancewiththeapplicablePRCaccountingstandardsandregulationsmustbeallocatedtotheSRFuntilthecumulativetotaloftheSRFreaches50%ofthesubsidiaries’registeredcapital.SubjecttoapprovalfromtherelevantPRCauthorities,theSRFmaybeusedtooffsetanyaccumulatedlossesorincreasetheregisteredcapitalofthesubsidiaries.TheSRFisnotavailablefordividenddistributiontoshareholders.

Therevaluationreserverepresentsincreaseinthefairvalueofcertainpropertiesthatweresubjecttoone-offrevaluationexerciseconducted in1994.Whentheproperty issold, therelatedamount in therevaluationreserveistransferredtoretainedearnings.

Theshareoptionreservecomprisesthecumulativevalueofservicesreceivedfromdirectorsandemployeesfortheissueoftheshareoptions.Theamountistransferredtoretainedearningsuponexpiryoftheshareoptionscheme.

TheforeigncurrencytranslationreservecomprisesforeignexchangedifferencesarisingfromthetranslationofthefinancialstatementsofforeignoperationswhosefunctionalcurrenciesaredifferentfromtheGroup’spresentationcurrency.

17 SHARE-BASED PAYMENT ARRANGEMENT

TheFuYuEmployeesShareOptionScheme(theScheme)oftheCompanywasapprovedandadoptedbyitsmembersatanExtraordinaryGeneralMeetingon29April2008.TheSchemeisadministeredbyacommitteecomprisingallexecutivedirectors.

The Scheme was further ratified at an Extraordinary General Meeting on 16 October 2014 whereby theexerciseperiodoftheemployeeoptionswasextendedto31December2014.Inrespectof3,000,000shareoptionspreviouslygrantedtoNon-ExecutiveDirectors,newshareoptionswereissuedasreplacementoptionsduetolegalrestrictionspertainingtoextensionofexerciseperiod.Thenewshareoptionsweregrantedonthesametermsastheoptionswithnovestingperiod.

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17 SHARE-BASED PAYMENT ARRANGEMENT(cont’d)

InformationregardingtheSchemeisasfollows:

• TheexercisepriceoftheoptionsisdeterminedastheaverageoftheclosingpricesoftheCompany’sordinary shares as quoted on Singapore Exchange for five consecutive market days immediatelyprecedingthedateofthegrant.

• Theoptionscanbeexercised1yearafterthedateofgrant.

• Theoptionsgrantedexpireon31December2014.

• Alloptionsaresettledbydeliveryofshares.

• Nooptionsaregrantedatadiscounttotheprevailingmarketpriceofshare.

Movements in the number of share options and their related weighted average exercise prices are asfollows:

2015 2014

Weighted average exercise

price $

No. of options

Weighted average exercise

price $

No. of options

At1January – – 0.09 34,060,000

Forfeitedduringtheyear – – 0.09 (13,900,000)

Exercisedduringtheyear – – 0.09 (20,160,000)

At31December – – 0.09 –

Theweightedaveragesharepriceatthedateofexerciseforshareoptionsexercisedin2014was$0.09.

The fairvalueofservices received in return forshareoptionsgrantedaremeasuredby reference to thefair value of share options. The estimate of the fair value of the services received is measured basedon theBlack-Scholes-Mertonmodel.Theexpected lifeused in themodelhasbeenadjusted,basedonmanagement’s best estimate, for the effects of non-transferability, exercise restrictionsandbehaviouralconsiderations.

Fairvalueofshareoptionsandassumptionsaresetoutbelow:

Date of grant of options 5 October 2008 16 October 2014

Fairvalueatmeasurementdate/modificationdate $0.020 $0.003

Shareprice $0.09 $0.09

Exerciseprice $0.09 $0.09

Expectedvolatility 19% 5%

Expectedoptionlife 5years 3months

Expecteddividendrate Nil Nil

Risk-freeinterestrate 2.25% 0.4%

75

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

17 SHARE-BASED PAYMENT ARRANGEMENT(cont’d)

Theexpectedvolatilityisbasedonthehistoricvolatility(calculatedbasedontheweightedaverageexpectedlifeof the shareoptions),adjusted foranyexpectedchanges to future volatilitydue topubliclyavailableinformation.

There are nomarket andnon-market performance conditions associatedwith the share options granted.Serviceconditionisnottakenintoaccountinthemeasurementofthefairvalueoftheservicestobereceivedatthegrantdate.

18 FINANCIAL LIABILITIES

Group

2015 $’000

2014 $’000

Non-current liabilities

Financeleaseliabilities – 12

Current liabilities

Securedbankloans – 1,361

Financeleaseliabilities – 4

– 1,365

– 1,377

Terms and debt repayment schedule

Termsandconditionsofoutstandingloansandborrowingsareasfollows:

Group

Nominalinterest

rate

2015 2014

Year of maturity

Face value

Carrying amount

Face value

Carrying amount

$’000 $’000 $’000 $’000

Securedbankloans 4.7% 2015 – – 1,361 1,361

Financeleaseliabilities 2.30%to2.55% 2014to2019 – – 16 16

– – 1,377 1,377

In2014,thesecuredbankloansaresecuredbypledgesovertheCompany’ssubsidiary,FuYuMoulding&Tooling(Chongqing)Co.,Ltd’stradereceivables.

76

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

18 FINANCIAL LIABILITIES(cont’d)

Finance lease liabilities

At31December,theGrouphasobligationsunderfinanceleasesasfollows:2015 2014

Principal $’000

Interest $’000

Payments $’000

Principal $’000

Interest $’000

Payments $’000

GroupPayable:Within1year – – – 4 * 4After1yearbutwithin5years – – – 12 1 13

– – – 16 1 17

Thefinanceleaseliabilitiesaresecuredbytheleasedassets.

* lessthan$1,000

19 TRADE AND OTHER PAYABLESGroup Company

Note 2015 $’000

2014 $’000

2015 $’000

2014 $’000

Tradepayables 22,530 33,853 3,219 3,299Accruedexpenses 8,131 10,192 2,911 1,876Amountspayablefor

purchaseofproperty,plantandequipment 760 894 82 225

Otherpayables 11,527 13,510 1,220 2,328Amountsdueto

subsidiaries:–trade – – 1,585 1,796–non-trade – – 1,063 1,117Deposits 1,653 2,277 314 399Financialliabilities

measuredatamortisedcost 44,601 60,726 10,394 11,040

Advancebillings 1,908 1,816 60 158Amountsduetocustomers

forcontractwork 12 919 630 76 9547,428 63,172 10,530 11,293

Non-current 112 787 112 787Current 47,316 62,385 10,418 10,506

47,428 63,172 10,530 11,293

Thenon-tradeamountsduetosubsidiariesareunsecured,interest-freeandrepayableondemand.

Includedinotherpayablesarepayablesarisingfromnon-inventorisedpurchases.

77

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

20 REvENUEGroup

2015 $’000

2014 $’000

Saleofgoods 197,991 228,151Revenuefromtoolingcontracts 24,474 26,283

222,465 254,434

21 OTHER INCOMEGroup

2015 $’000

2014 $’000

Interestincome 1,805 1,352Rentalincome 4,970 4,897Gainondisposalofproperty,plantandequipment 483 821Saleofscrapandrawmaterials 980 1,286Gainonliquidationofasubsidiary 393 –Governmentgrants 135 1,762Others 862 486

9,628 10,604

Includedinrentalincomeissubleasepaymentsof$2,926,000(2014:$2,871,000).

ThegovernmentgrantcompensatesasubsidiaryoftheGroupforexpensesincurredandisrecogniseddirectlyinprofitorloss.Thegrantwasconditionalthatthesubsidiaryoperatesinspecificindustriesdesignatedbylocalgovernment.

22 OTHER OPERATING INCOME, NETGroup

2015 $’000

2014 $’000

Foreignexchangegain,net 2,710 2,536Otheroperatingincome 2,710 2,536

Property,plantandequipmentwrittenoff (157) (279)Allowancemadefordoubtfulreceivables (64) (267)Baddebtswrittenoff (86) –Impairmentlossonproperty,plantandequipment – (500)Otheroperatingexpense (307) (1,046)

Otheroperatingincome,net 2,403 1,490

78

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

23 FINANCE COSTSGroup

2015 $’000

2014 $’000

Interestexpense

–bankloans 11 152

–financeleases * 1

11 153

* lessthan$1,000

24 PROFIT BEFORE INCOME TAx

Thefollowingitemshavebeenincludedinarrivingatprofitbeforeincometax:

Group

Note 2015 $’000

2014 $’000

DirectorsoftheCompany

–fees 334 343

–salaries,bonusesandothercosts 3,073 3,135

–contributionstodefinedcontributionplans 53 74

Directorsofsubsidiaries

–fees 83 93

–salaries,bonusesandothercosts 14 11

Auditfeespaidorpayableto

–auditorsoftheCompany 148 154

–overseasaffiliatesoftheauditorsoftheCompany 173 238

–otherauditors 128 167

Non-auditfeespaidorpayableto

–auditorsoftheCompany 26 –

–otherauditors 14 18

Depreciationofproperty,plantandequipmentandinvestmentproperty 4,5 13,769 17,930

Staffcosts,excludingdirectorsoftheCompanyandsubsidiaries

–salaries,bonusesandothercosts 49,178 48,783

–contributionstodefinedcontributionplans 5,917 4,978

Operatingleaseexpenses 5,460 5,055

Operatingexpensesincurredinrelationtoinvestmentproperty 239 277

79

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

25 TAx ExPENSEGroup

2015 $’000

2014 $’000

Current tax expense

Currentyear 2,474 2,234

Grouptaxrelief (395) _

Withholdingtaxes 496 –

Over-provisionofprioryears (24) (215)

2,551 2,019

Deferred tax (credit)/expense

Movementsintemporarydifferences 1,699 572

Reductionintaxrate 16 –

Recognitionoftaxeffectofpreviouslyunrecognisedtaxlosses (2,471) –

Over-provisioninprioryears (40) (412)

(796) 160

Tax expense 1,755 2,179

Reconciliation of effective tax rate

Profitbeforeincometax 18,437 13,417

TaxcalculatedusingSingaporetaxrateof17%(2014:17%) 3,134 2,281

Effectofdifferenttaxratesinforeignjurisdictions 93 (204)

Reductionintaxrate 16 –

Incomenotsubjecttotax (666) (1,386)

Expensesnotdeductiblefortaxpurposes 1,337 724

Taxincentive (387) –

Taxeffectofdebtforgivenesstreatedasincomefortaxpurposes – 2,263

Recognitionoftaxeffectofpreviouslyunrecognisedtaxlosses (2,471) –

Utilisationofcapitalallowances,reinvestmentallowancesandtaxlossespreviouslynotrecognised (333) (2,847)

Overprovisioninprioryears (64) (522)

Deferredtaxassetsnotrecognised 1,092 2,002

Withholdingtaxes 496 –

Grouptaxrelief (395) –

Others (97) (132)

1,755 2,179

80

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

25 TAx ExPENSE(cont’d)

TheGrouphasexposure to income taxes innumerous jurisdictions.Significant judgement is involved indetermining the group-wide provision for income taxes. There are certain transactions and computationsfor which the ultimate tax determination is uncertain during the ordinary course of business. The Grouprecognises liabilities for expected tax issuesbasedonestimatesofwhetheradditional taxeswill bedue.Wherethefinaltaxoutcomeofthesemattersisdifferentfromtheamountsthatwereinitiallyrecognised,suchdifferenceswillimpacttheincometaxanddeferredtaxprovisionsintheperiodinwhichsuchdeterminationismade.

IncometaxforthesubsidiariesinMalaysiaiscalculatedatthestatutoryrateof25%duringtheyear.Thestatutorytaxratewouldbereducedto24%effectiveforyear2016.

OneofthesubsidiariesinChinawasaccreditedasa“HighandNewTechnologyEnterprise”in2013andwasentitledtoapreferentialtaxrateof15%foraperiodofthreeyearsfrom2013to2015whichissubjecttothesubsidiary’scompliancewiththeconditionsimposedbythetaxauthority.AnothersubsidiaryoperatesinwesternChinaofwhichtheindustryitoperatesinenjoyspreferentialtaxrateof15%.

26 EARNINGS PER SHAREGroup

2015 $’000

2014 $’000

Basicanddilutedearningspershareisbasedon:

Netearningsattributabletoordinaryshareholders 14,070 9,951

Number of shares 2015

Number of shares 2014

Issuedordinarysharesat1January 752,994,775 732,834,775

Effectofsharesissuedduringtheyear – 1,782,055

Weightedaveragenumberofordinaryshares(basicanddiluted) 752,994,775 734,616,830

Basicanddilutedearningspershare(cents) 1.87 1.35

DilutedearningspershareisthesameasbasicearningspershareastherearenodilutiveinstrumentswiththeexpiryoftheEmployeesShareOptionsSchemeon31December2014.

81

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

27 OPERATING SEGMENTS

TheGrouphasthreereportablesegmentswhicharegeographicalsegmentsandarebasedonthelocationofassets,namelySingapore,MalaysiaandChina.Thesegeographicalsegmentsaremanagedseparatelybecausetheyrequiredifferentmarketingstrategiesandbeardifferentfinancialandbusinessrisks.ThelocationoftheGroup’scustomersisnotsignificantlydifferentfromthelocationoftheGroup’sassets.Inpresentinginformationonthebasisofgeographicalsegments,segmentrevenueandsegmentassetsarebasedonthegeographicallocationoftheassets.

Segment resultsandassets include itemsdirectlyattributable toasegmentaswellas those thatcanbeallocatedonareasonablebasis.

Performanceismeasuredbasedonprofitbeforeincometax,depreciationofproperty,plantandequipmentandinvestmentproperty,(impairmentloss)/reversalofimpairmentlossonproperty,plantandequipment,financecostandnetforeignexchangegainasincludedininternalmanagementreportsthatarereviewedbytheGroup’schiefoperatingdecisionmaker.SuchinformationisthemostrelevantinevaluatingtheresultsofcertainsegmentsrelativetootherentitiesthatoperatewithintheGroup’sindustry.Inter-segmentpricingisbasedontermsagreedbythecounterparties.

Concentration of revenue

Revenue of approximately $53,169,000 (2014: $93,811,000) relates to two (2014: three) externalcustomerswithrevenueinexcessof10%ofGrouprevenue.ThisrevenuerelatestoSingapore,MalaysiaandChinasegments.

82

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

27

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83

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

28 FINANCIAL RISK MANAGEMENT

TheGrouphasasystemofcontrolsinplacetocreateanacceptablebalancebetweenthecostofrisksoccurringandthecostofmanagingtherisks.ManagementcontinuallymonitorstheGroup’sriskmanagementprocesstoensurethatanappropriatebalancebetweenriskandcontrolisachieved.

Credit risk

The Group has a credit policy in place which establishes credit limits for customers and monitors theirbalancesonanongoingbasis.Cashandfixeddepositsareplacedwithbanksandfinancial institutionswhichareregulated.

Atthereportingdate,thereisaconcentrationofcreditriskinthefollowinggeographicalareas:

Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

Singapore 8,426 9,506 7,910 8,583

China 30,572 43,163 1,178 1,576

Malaysia 10,228 9,835 795 637

UnitedStates 2,497 1,435 128 297

HongKong 292 740 1,625 1,525

Others 4,639 6,489 1,759 2,577

56,654 71,168 13,395 15,195

At thereportingdate, there isaconcentrationofcredit riskrelatingto two(2014: three)majorcustomerswithoutstandingreceivablebalanceofapproximately$9,821,000(2014:$29,242,000).ThesecustomersrelatetoSingapore,MalaysiaandChinasegments.

Themaximumexposuretocreditriskisrepresentedbythecarryingamountofeachfinancialassetsinthestatementoffinancialposition.

Theageinganalysisofloansandreceivablesisasfollows:

2015 2014

Gross $’000

Impairment loss

$’000Gross $’000

Impairment loss

$’000

Group

Notpastdue 39,317 – 54,285 –

Pastdue1to30days 12,202 – 13,127 –

Pastdue31to90days 3,119 – 1,266 9

Pastduemorethan90days 8,667 8,096 8,927 7,900

Nocreditterms 1,445 – 1,472 –

64,750 8,096 79,077 7,90927

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84

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

28 FINANCIAL RISK MANAGEMENT(cont’d)2015 2014

Gross $’000

Impairment loss

$’000Gross $’000

Impairment loss

$’000

Company

Notpastdue 5,838 – 6,841 –

Pastdue1to30days 3,071 – 2,159 –

Pastdue31to90days 882 – 841 –

Pastduemorethan90days 3,215 69 4,892 13

Nocreditterms 458 – 475 –

13,464 69 15,208 13

Movementsintheallowanceforimpairmentlossinrespectoftradereceivablesduringtheyearareasfollows:

Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

At1January 7,893 7,633 5 10

Allowancemade/(writtenback) 9 259 1 (5)

Allowanceutilised (30) (148) – –

Currencyrealignment 153 149 – –

At31December 8,025 7,893 6 5

Movementsintheallowanceforimpairmentlossinrespectofotherreceivablesduringtheyearareasfollows:

Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

At1January 16 8 8 –

Allowancemade 55 8 55 8

At31December 71 16 63 8

The Group follows the guidance of FRS 39 Financial Instruments: Recognition and Measurement indeterminingwhenafinancialassetisimpaired.Thisdeterminationrequiressignificantjudgment.TheGroupevaluatesamongother factors, thefinancialhealth, repaymenthistoryandnear-termbusinessoutlookofthefinancialassets,includingfactorssuchasindustryandsectorperformance.TheGroupbelievesthatnoadditionalimpairmentallowance,otherthanthosespeciallyidentified,isnecessaryinrespectoftradeandotherreceivables.ThesereceivablesaremainlyarisingfromcustomersthathaveagoodpaymentrecordwiththeGroup.

85

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

28 FINANCIAL RISK MANAGEMENT(cont’d)

Liquidity risk

TheGroupmonitorsitsliquidityriskandmaintainsalevelofcashandcashequivalentsdeemedadequatebymanagementtofinancetheGroup’soperationsandtomitigatetheeffectsoffluctuationsincashflows.

Thefollowingarethecontractualmaturitiesoffinancialliabilities,includingestimatedinterestpaymentsandexcludingtheimpactofnettingagreements.

Group

Carrying amount $’000

Contractual cash flows

$’000

Less than 1 year $’000

Between 1 and 5 years $’000

More than 5 years $’000

2015

Non-derivative financial liabilities

Tradeandotherpayables(1) 44,601 44,601 44,489 112 –

2014

Non-derivative financial liabilities

Tradeandotherpayables(1) 60,726 60,726 59,939 787 –

Financialliabilities

- Financeleaseliabilities 16 17 4 13 –

- Securedbankloans 1,361 1,367 1,367 – –

62,103 62,110 61,310 800 –

Company

2015

Non-derivative financial liabilities

Tradeandotherpayables(1) 10,394 10,394 10,282 112 –

2014

Non-derivative financial liabilities

Tradeandotherpayables(1) 11,040 11,040 10,253 787 –

(1) Excludesadvancebillingsandamountsduetocustomersforcontractwork

Itisnotexpectedthatthecashflowsincludedinthematurityanalysiswouldoccursignificantlyearlier,oratsignificantlydifferentamounts.

86

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

28 FINANCIAL RISK MANAGEMENT(cont’d)

Market risk

Marketriskistheriskthatchangesinmarketprices,suchasinterestratesandforeignexchangerateswillaffecttheGroup’sincomeorthevalueoffinancialinstruments.Theobjectiveofmarketriskmanagementistomanageandcontrolmarketriskexposureswithinacceptableparameters,whileoptimisingthereturnonrisk.

Interest rate risk

At thereportingdate, theinterestrateprofilesof theGroup’sinterest-bearingfinancial instrumentswereasfollows:

Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

Fixed rate instruments

Financialassets 57,211 39,888 23,544 12,850

Financialliabilities – (16) – –

57,211 39,872 23,544 12,850

variable rate instrument

Financialliabilities – (1,361) – –

TheGroup’sinterest-bearingfinancialassetscomprisefixeddepositsplacedwithbanks.Thedepositswererolledoverduringthefinancialyearatmarketinterestratesuponmaturity.

Financialliabilitiescomprisevariable-rateborrowingsandfixed-ratefinanceleases.

Sensitivityanalysis

Anincreaseof100basispointsininterestratesatthereportingdatewouldhaveincreasedprofitfortheyearby$572,000(2014:$385,000)and$235,000(2014:$129,000)forGroupandCompanyrespectively.Thisanalysisassumesthatallothervariables,inparticularforeigncurrencyrates,remainconstant.

Adecreaseof100basispointsininterestratesatthereportingdatewouldhavehadtheequalbutoppositeeffectontheamountsshownabove,onthebasisthatallothervariablesremainconstant.Theanalysisisperformedonthesamebasisfor2014.

Foreign currency risk

TheGroupisexposedtoforeigncurrencyriskonsales,purchasesandcashandcashequivalentsthataredenominatedincurrenciesotherthantherespectivefunctionalcurrenciesoftheGroupentities.ThecurrencygivingrisetothisriskisprimarilytheUnitedStates(US)dollar.

87

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

28 FINANCIAL RISK MANAGEMENT(cont’d)

TheGroup’sandCompany’sexposurestoforeigncurrencyrisk(beforeeliminationofinter-companybalances)areasfollows:

Group Company

2015 US dollar

$’000

2014 US dollar

$’000

2015 US dollar

$’000

2014 US dollar

$’000

Tradeandotherreceivables 128,335 137,221 9,327 10,280

Cashandcashequivalents 42,319 19,015 27,002 7,474

Tradeandotherpayables (95,273) (96,222) (4,591) (4,593)

Financialliabilities – (1,361) – –

75,381 58,653 31,738 13,161

Sensitivityanalysis

AonepercentagepointstrengtheningoftheSingaporedollaragainsttheUSdollaratthereportingdatewoulddecreasetheGroup’sprofitbeforeincometaxbyapproximately$754,000(2014:$587,000)anddecreasethe Company’s profit before income tax by approximately $317,000 (2014: $132,000). This analysisassumesthatallothervariablesinparticularinterestrates,remainconstant.

AonepercentagepointweakeningoftheSingaporedollaragainsttheUSdollaratthereportingdatewouldhavehadtheequalbutoppositeeffectontheamountsshownabove,onthebasisthatallothervariablesremainconstant.Theanalysisisperformedonthesamebasisfor2014.

Accounting classification and fair values

Thecarryingamountsoffinancialassetsandliabilities(includingtradeandotherreceivables,cashandcashequivalents,financialliabilitiesandtradeandotherpayables)carriedatcostoramortisedcostareassumedtoapproximatetheirfairvaluesasat31December2015and2014giventheshortperiodtomaturityorre-pricing.

Financialliabilitiesaremainlyclassifiedascurrentliabilitiesandtheimpactofdiscountingarisingfromthenon-currentliabilitiesisnotexpectedtobematerial.

Group

Designated at fair value $’000

Loans and receivables

$’000

Other financial liabilities $’000

Total carrying amount $’000

31 December 2015

Tradeandotherreceivables+ – 56,654 – 56,654

Cashandcashequivalents – 102,940 – 102,940

Shortterminvestments 3,637 – – 3,637

Tradeandotherpayables# – – (44,601) (44,601)

3,637 159,594 (44,601) 118,630

+ Excludeprepayment,advancestosuppliersandamountsduefromcustomersforcontractwork# Excludesadvancebillingsandamountsduetocustomersforcntractwork

88

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

28 FINANCIAL RISK MANAGEMENT(cont’d)

Group

Designated at fair value $’000

Loans and receivables

$’000

Other financial liabilities $’000

Total carrying amount $’000

31 December 2014

Tradeandotherreceivables+ – 71,168 – 71,168

Cashandcashequivalents – 83,329 – 83,329

Shortterminvestments 6,052 – – 6,052

Tradeandotherpayables# – – (60,726) (60,726)

Financialliabilities – – (1,377) (1,377)

6,052 154,497 (62,103) 98,446

+ Excludesprepayments,advancestosuppliersandamountsduefromcustomersforcontractwork# Excludesadvancebillingsandamountsduetocustomersforcontractwork

Company

Loans and receivables

$’000

Other financial liabilities $’000

Total carrying amount $’000

31 December 2015

Tradeandotherreceivables+ 13,395 – 13,395

Cashandcashequivalents 29,962 – 29,962

Tradeandotherpayables# – (10,394) (10,394)

43,357 (10,394) 32,963

31 December 2014

Tradeandotherreceivables+ 15,195 – 15,195

Cashandcashequivalents 18,051 – 18,051

Tradeandotherpayables# – (11,040) (11,040)

33,246 (11,040) 22,206

+ Excludesprepayments,advancestosuppliersandamountsduefromcustomersforcontractwork# Excludesadvancebillingsandamountsduetocustomersforcontractwork

89

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

29 COMMITMENTS

Capital expenditure commitments

Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

Capitalexpenditurecontractedforasatthereportingdatebutnotrecognisedinthefinancialstatements 1,467 2,449 726 711

Operating lease commitments

Leasesaslessee

The Group and the Company lease certain properties and land under lease arrangements that are non-cancellablewithinoneyear.Otherleases,whichincludetherenewaloptions,expireatvariousdatestill2044andcontainprovisions for rentaladjustmentsand restrictions to further sub-leasecertainproperties.OneoftheleasedpropertieshasbeensubletbytheGrouptoathirdparty.Subleasepaymentsof$2,830,000(2014:$2,660,000)areexpectedtobereceivedwithin1year.Thesubsequentpaymentsof$9,581,000(2014: $13,154,000) and nil (2014: $1,100,000) will be received within 5 years and after 5 yearsrespectively.

At31December,theGroupandtheCompanyhavecommitmentsforfutureminimumleasepaymentsundernon-cancellableoperatingleasesasfollows:

Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

Payable:

Within1year 5,805 4,937 1,646 782

After1yearbutwithin5years 15,339 15,613 3,166 2,412

After5years 5,446 6,815 5,446 5,715

26,590 27,365 10,258 8,909

Leases as lessor

At31December2015,theGroupenteredintocancellableandnon-cancellablecommercialpropertyleasestoleaseoutitssurplusspace.ThecancellablecommercialpropertyleasescanbecancelledbywayofthelesseesgivingnoticeinadvancetotheGroupandviceversa.Thenon-cancellableleaseshaveremainingnon-cancellableleasetermsasfollows:

Group Company

2015 $’000

2014 $’000

2015 $’000

2014 $’000

Receivable:

Within1year 1,417 1,633 941 1,391

After1yearbutwithin5years 299 595 – 941

1,716 2,228 941 2,332

90

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

30 RELATED PARTIES

Key management personnel compensation

Key management personnel of the Group are those persons having the authority and responsibility forplanning,directingandcontrollingtheactivitiesoftheentity.ThedirectorsandkeyexecutivesareconsideredaskeymanagementpersonneloftheGroupandCompany.

Keymanagementpersonnelcompensationcomprises:

Group

2015 $’000

2014 $’000

Directors’fees 334 343

Shorttermemployeebenefits 3,904 3,943

Contributionstodefinedcontributionplans 85 104

4,323 4,390

Compriseamountspaid/payableto:

- directorsoftheCompany 3,460 3,552

- keyexecutives 863 838

4,323 4,390

Other related party transactions

Otherthandisclosedelsewhereinthefinancialstatements,transactionswithrelatedpartiesareasfollows:

Group

2015 $’000

2014 $’000

Rentalincomefromajointventure 453 497

Dividendfromajointventure 667 496

31 DIvIDENDS

Thefollowingexempt(one-tier)dividendsweredeclaredandpaidbytheGroupandCompany:

Group and Company

2015 $’000

Paid by the Company to owners of the Company

Aninterimdividendof$0.25centsperqualifyingordinaryshare 1,883

Secondinterimdividendof$0.25centsperqualifyingordinaryshare 1,882

3,765

91

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTES TO THE FINANCIAL STATEMENTSYEAR ENDED 31 DECEMBER 2015

31 DIvIDENDS(cont’d)

Group

2015 $’000

Paid by a subsidiary to NCI

AninterimdividendofRM0.5centsperqualifyingordinaryshare 174

SecondinterimdividendofRM0.5centsperqualifyingordinaryshare 174

348

After the reporting date, the following exempt (one-tier) dividendswere proposed by the directors. Theseexempt(one-tier)dividendshavenotbeenprovidedfor.

Group and Company

2015 $’000

Proposed by the Company to owners of the Company

Afinaldividendof$1.0centsperqualifyingordinaryshare 7,530

Group

2015 $’000

Proposed by a subsidiary to NCI

AfinaldividendofRM3.0centsperqualifyingordinaryshare 1,044

32 COMPARATIvE INFORMATION

Certainchangeshavebeenmadetothecomparativeinformationintheconsolidatedincomestatementasfollows:

Group

2014 $’000

2014 $’000

As previously stated Restated

Otherincome 10,269 10,604

Sellingandadministrativeexpenses (26,322) (29,193)

Otheroperatingincome,net (1,046) 1,490

Rental income of $2,871,000 which was netted off against operating lease expenses in selling andadministrativeexpenseshasbeenreclassifiedtootherincometobeconsistentwithcurrentyear’sclassification.

Inaddition, foreignexchangegainof$2,536,000was reclassified fromother income tootheroperatingincome,nettobealignedwiththeGroup’saccountingpolicy.

92

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

RISK MANAGEMENT (LISTING RULE 1207(4) (B)(Iv))

TheGroupfacesinternalandexternalrisksthatarecategorisedasenvironmentalandoperationalrisks.

Operationalriskistheriskoflossarisingfromexternalevents,orfrominadequateorfailedinternalprocesses,peopleorsystems.

Themain risksarising from theGroup’sfinancialassetsand liabilitiesarecredit risk, liquidity risk,market risk,interestrateriskandforeignexchangerisk.TheBoardreviewsandagreesonpoliciestomanageitsexposuretofinancialrisks.Detailsof thevariousfinancialriskfactorsareoutlinedinNote28totheFinancialStatementsonpages83to88.

MATERIAL CONTRACTS (LISTING RULE 1207(8)) Therewerenomaterial contractsentered intoby theCompanyand/or itssubsidiarieswith thedirectorsorchiefexecutiveofficerorcontrollingshareholdersoftheCompanywhichwerestillsubsistingattheendofthefinancialyearunderreview,orifnotsubsisting,enteredintosincetheendofthepreviousfinancialyear.

INTERESTED PERSON TRANSACTIONS (LISTING RULE 1207(17))

TheSingaporeExchangeSecuritiesTradingLimited(“SGX-ST”)requireslistedcompanytocomplywithChapter9oftheListingManualofSGX-SToninterestedpersontransactions.

Therewerenointerestedpersontransactionsfortheyearended31December2015.

DEALINGS WITH COMPANY’S SECURITIES (LISTING RULE 1207(19))

TheCompanyhasadoptedaninternalcodetoprovideguidancetoitsofficerswithregardtodealingsintheCompany’ssecuritiesbydirectorsandemployees.ThecodestatesofficersoftheCompanyshouldnotdealintheCompany’ssecuritiesduringtheperiodcommencingtwoweeksbeforetheannouncementoftheCompany’sfinancialstatementsforeachofthefirstthreequartersofitsfinancialyearandonemonthbeforetheannouncementoftheCompany’sfullyearfinancialstatements.TheCompanyalsoprovidesguidancetoitsofficerswithregardstonodealingintheCompany’ssecuritiesonshort-termconsiderations.

ADDITIONAL INFORMATIONREqUIRED BY THE LISTING MANUAL

93

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

ADDITIONAL INFORMATIONREqUIRED BY THE LISTING MANUAL

LAND AND BUILDINGS (LISTING RULE 1207 (11))No Company

NameLocation of the properties

Existing Use Year of acquisition

Land Area/ Built-up Area

Percentage interest in property

Tenure

1 FuYuCorporationLimited

5TuasDrive1 Singapore638672

Warehouse,factoryandoffice

1981 Land: 4,756sqmBuilding:5,179sqm

100% Leaseholdfor60yearsexpiringon15Nov2041

7TuasDrive1 Singapore638674

Warehouse,factoryandoffice

1981 Land: 4,756sqmBuilding:2,646sqm

100% Leaseholdfor40yearsexpiringon15Nov2021

8TuasDrive1 Singapore638675

Warehouse,factoryandoffice

1988 Land: 5,000sqmBuilding:3,606sqm

100% Leaseholdfor56yearsexpiringon31Oct2044

9TuasDrive1 Singapore638676

Warehouse,factoryandoffice

1981 Land: 4,755sqmBuilding:2,572sqm

100% Leaseholdfor40yearsexpiringon15Nov2021

10TuasDrive1 Singapore638677

Warehouse,factoryandoffice

1988 Land: 3,366sqmBuilding:3,334sqm

100% Leaseholdfor56yearsexpiringon31Oct2044

43SenokoDrive Singapore758227

Warehouse,factoryandoffice

1982 Land: 6,445sqmBuilding:6,961sqm

100% Leaseholdfor38yearsexpiringon15Sep2020

2 ClassicAdvantageSdnBhd

21,JalanTecknologi4 TamanTeknologi Johor,81400 Senai,JohorDarulTa’zim,Malaysia

Warehouse,factoryandoffice

2004 Land: 54,054sqmBuilding:12,728sqmInvestmentproperties:15,700sqm

100% Leaseholdfor60yearsexpiringon31Mar2066

3 FuHaoManufacturing(M)SdnBhd

Plot562Mukim1 JalanPerusahaan Baru1,PeraiIII PeraiIndustrialEstate 13600Perai,Penang, Malaysia

Warehouse,factoryandoffice

1995 Land: 5,807sqmBuilding:4,865sqm

100% Leaseholdfor60yearsexpiringon11Dec2050

4 FuYuMoulding&Tooling(Suzhou)Co.,Ltd

89XingNanRoad WuzhongEconomicSkillDevelopmentZone Suzhou,China215128

Warehouse,factoryandoffice

2006 Land:58,847sqmBuilding:47,800sqm

100% Leaseholdfor50yearsexpiringon18Mar2054

5 FuYuMoulding&Tooling(Dongguan)Co.,Ltd

JingFuRoad, XinChengIndustryArea HengLiTown, Dongguan,Guangdong, China523477

Warehouse,factoryandoffice

1997 Land:15,000sqmBuilding:21,110sqm

100% Leaseholdfor50yearsexpiringon14Dec2047

2001 Land:10,000sqmBuilding:18,890sqm

100% Leaseholdfor50yearsexpiringon17May2051

94

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

STATISTICS OF SHAREHOLDINGS AS AT 23 MARCH 2016

Classofequitysecurities : OrdinaryShares

Numberofequitysecurites : 752,994,775ordinaryshares

Votingrights : onevotepershare

TheCompanydoesnotholdanytreasuryshares.

DISTRIBUTION OF SHAREHOLDINGS

SIZEOFSHAREHOLDINGS NO.OFSHAREHOLDERS % NO.OFSHARES %

1-99 37 0.65 1,144 0.00

100-1,000 323 5.63 160,443 0.02

1,001-10,000 3,036 52.97 14,653,825 1.95

10,001-1,000,000 2,302 40.16 128,510,511 17.07

1,000,001ANDABOVE 34 0.59 609,668,852 80.96

TOTAL 5,732 100.00 752,994,775 100.00

SUBSTANTIAL SHAREHOLDERS AS AT 23 MARCH 2016(AsrecordedintheRegisterofSubstantialShareholders)

DirectInterest % DeemedInterest %

NgHockChing(1) 829,000 0.11 106,993,475 14.21

HoNeeKit 96,999,225 12.88 – –

TamWai(2) 96,715,475 12.84 300,000 0.04

ChingHengYang 88,965,475 11.81 – –

Note:1 MrNgHockChingisdeemedtobeinterestedinthe106,993,475sharesheldinthenamesof(a)CitibankNomineesSingaporePteLtd:

24,036,000;(b)DBSNomineesPteLtd:28,958,000;and(c)PhilipSecuritiesPteLtd:53,999,475.

2 MrTamWaiisdeemedtobeinterestedinthe300,000sharesheldinthenameofhisspouse.

95

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

TWENTY LARGEST SHAREHOLDERS

NO. NAME NO.OFSHARES %

1 HONEEKIT 96,999,225 12.88

2 TAMWAI 96,715,475 12.84

3 CHINGHENGYANG 88,965,475 11.81

4 PHILLIPSECURITIESPTELTD 82,995,675 11.02

5 DBSNOMINEES(PRIVATE)LIMITED 56,804,100 7.54

6 RAFFLESNOMINEES(PTE)LIMITED 39,202,400 5.21

7 CITIBANKNOMINEESSINGAPOREPTELTD 36,181,700 4.81

8 UNITEDOVERSEASBANKNOMINEES(PRIVATE)LIMITED 15,474,731 2.06

9 UOBKAYHIANPRIVATELIMITED 12,344,500 1.64

10 OCBCSECURITIESPRIVATELIMITED 9,170,239 1.22

11 MAYBANKKIMENGSECURITIESPTE.LTD. 8,315,272 1.10

12 HEWLIENLEE 8,100,000 1.08

13 HONGLEONGFINANCENOMINEESPTELTD 7,257,000 0.96

14 DBNOMINEES(SINGAPORE)PTELTD 6,807,150 0.90

15 CIMBSECURITIES(SINGAPORE)PTE.LTD. 4,326,550 0.57

16 NGCHUNGMING 4,014,300 0.53

17 HOKANGPENG 3,630,000 0.48

18 OCBCNOMINEESSINGAPOREPRIVATELIMITED 3,242,010 0.43

19 CITIBANKCONSUMERNOMINEESPTELTD 3,173,000 0.42

20 DBSVICKERSSECURITIES(SINGAPORE)PTELTD 2,890,250 0.38

TOTAL 586,609,052 77.88

Asat23March2016,46.55%oftheissuedsharecapitaloftheCompanywereheldinthehandsofthepublic(basedontheinformationavailabletotheCompany).Accordingly,theCompanyhascompliedwithRule723oftheListingManualofSingaporeExchangeSecuritiesTradingLimited.

STATISTICS OF SHAREHOLDINGS AS AT 23 MARCH 2016

96

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTICE OF ANNUAL GENERAL MEETING

NOTICEISHEREBYGIVENthattheAnnualGeneralMeeting(the“AGM”)ofFuYuCorporationLimited(“theCompany”)willbeheldatBridgeRooms,Level2,RafflesMarina,10TuasWestDrive,Singapore638404onTuesday,26April2016at2.30p.m.forthepurposesoftransactingthefollowingbusinesses:

AS ORDINARY BUSINESS

1. To receiveandadopt theDirectors’Statementand theAuditedFinancialStatements for thefinancial yearended31December2015togetherwiththeAuditors’Reportthereon.

(Resolution 1)

2. Toapproveataxexempt(one-tier)finaldividendof1.0centperordinaryshareforthefinancialyearended31December2015asrecommendedbytheDirectors.

(Resolution 2)

3. Tore-electthefollowingDirectorsretiringpursuanttoArticle91oftheConstitutionoftheCompany:

(a) DrJohnChenSeowPhun[seeexplanatorynote(i)]

(Resolution 3)

(DrJohnChenSeowPhun,uponre-electionasaDirectoroftheCompany,remainsasChairmanoftheAuditCommittee;andamemberoftheNominatingandRemunerationCommittees.HeisconsideredindependentforthepurposeofRule704(8)oftheListingManualoftheSingaporeExchangeSecuritiesTradingLimited.)

(b) MrTamWai[seeexplanatorynote(i)]

(Resolution 4)

(c) MrHoNeeKit[seeexplanatorynote(i)]

(Resolution 5)

4. ToapprovethepaymentofDirectors’feesofS$258,000forthefinancialyearending31December2016,payablequarterlyinarrears(2015:S$258,000).

(Resolution 6)

5. Tore-appointMessrsKPMGLLPastheAuditorsoftheCompanyandtoauthorisetheDirectorsoftheCompanytofixtheirremuneration.

(Resolution 7)

6. TotransactanyotherordinarybusinesswhichmayproperlybetransactedatanAGM.

AS SPECIAL BUSINESS

To consider and if thought fit, to pass the following resolutions as Ordinary Resolution, with or without anymodifications:

7. Ordinary Resolution: Authority to allot and issue shares

“That,pursuanttoSection161oftheCompaniesAct,Cap.50andRule806(2)oftheListingManualoftheSingaporeExchangeSecuritiesTradingLimited(“SGX-ST”),authoritybeandisherebygiventotheDirectorsoftheCompanyto:-

(a) (i) issueshares in thecapitalof theCompany(“Shares”)whetherbywayof rights,bonusorotherwise;and/or

(ii) makeorgrantoffers,agreementsoroptions(collectively,“Instruments”)thatmightorwouldrequiresharestobeissued,includingbutnotlimitedtothecreationandissueof(aswellasadjustmentsto)securities,warrants,debenturesorotherinstrumentsconvertibleintoShares,

atanytimeanduponsuchtermsandconditionsandforsuchpurposesandtosuchpersonsastheDirectorsmayintheirabsolutediscretiondeemfit;and

97

FU YU CORPO

RATION

LIMITED

ANN

UAL REPORT 2015

NOTICE OF ANNUAL GENERAL MEETING

NOTICE OF ANNUAL GENERAL MEETING

(b) (notwithstanding theauthorityconferredby thisResolutionmayhaveceased tobe in force) issuesharesinpursuanceofanyInstrumentmadeorgrantedbytheDirectorswhilethisResolutionwasinforce,

providedthat:

(1) theaggregatenumberofSharestobeissuedpursuanttothisResolution(includingsharestobeissuedinpursuanceofInstrumentsmadeorgrantedpursuanttothisResolution)doesnotexceedfiftypercent.(50%)oftheCompany’stotalnumberofissuedSharesexcludingtreasuryshares(ascalculatedinaccordancewithsub-paragraph(2)below),ofwhichtheaggregatenumber of Shares to be issued other than on a pro-rata basis to existing shareholders oftheCompany(includingShares tobe issued inpursuanceof InstrumentsmadeorgrantedpursuanttothisResolution)doesnotexceedtwentypercent(20%)oftheCompany’stotalnumberof issuedSharesexcludingtreasuryshares(ascalculated inaccordancewithsub-paragraph(2)below).UnlesspriorshareholderapprovalisrequiredundertheListingManualoftheSGX-ST,anissueoftreasuryshareswillnotrequirefurthershareholderapproval,andwillnotbeincludedintheaforementionedlimits.

(2) (subjecttosuchmannerofcalculationasmaybeprescribedbytheSGX-ST)forthepurposeofdeterminingtheaggregatenumberofsharesthatmaybeissuedundersub-paragraph(1)above,thetotalnumberofissuedSharesexcludingtreasurysharesisbasedontheCompany’stotalnumberofissuedSharesexcludingtreasurysharesatthetimethisResolutionispassed,afteradjustingfor:

(i) new Shares arising from the conversion or exercise of any convertible securities orshareoptionsorvestingofshareawardswhichareoutstandingorsubsistingat thetimethisResolutionispassed;and

(ii) anysubsequentbonusissue,consolidationorsubdivisionofShares;

(3) in exercising the authority conferred by this Resolution, the Company shall comply withtheprovisionsof theListingManualof theSGX-ST for the timebeing in force(unlesssuchcompliancehasbeenwaivedby theSGX-ST)and theConstitution for the timebeingof theCompany;and

(4) (unlessrevokedorvariedbytheCompanyingeneralmeeting)theauthorityconferredbythisResolutionshallcontinueinforceuntiltheconclusionofthenextAGMoftheCompanyorthedatebywhichthenextAGMoftheCompanyisrequiredbylawtobeheld,whicheveristheearlier.”[seeexplanatorynote(ii)]

(Resolution 8)

8. Ordinary Resolution: The Proposed Renewal of Share Purchase Mandate

That:

(1) forthepurposesofSections76Cand76EoftheCompaniesAct,Chapter50ofSingapore(“Companies Act”),theexercisebythedirectorsoftheCompany(“Directors”)ofallthepowersoftheCompany:

(a) to purchase or otherwise acquire issued ordinary shares in the capital of the Company(“Shares”)notexceedinginaggregatetheMaximumLimit(ashereinafterdefined),atsuchpriceorpricesasmaybedeterminedbytheDirectorsfromtimetotimeuptotheMaximumPrice(ashereinafterdefined),whetherbywayof:

(i) anon-marketpurchase(“On-Market Purchase”)transactedontheSingaporeExchangeSecuritiesTradingLimited(“SGx-ST”);and/or

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(ii) anoff-marketpurchase(“Off-Market Purchase”)effectedinaccordancewithanequalaccessscheme(asdefinedinSection76CoftheCompaniesAct)asmaybedeterminedorformulatedbytheDirectorsastheyconsiderfit,whichschemeshallsatisfyalltheconditionsprescribedbytheCompaniesAct,

andotherwiseinaccordancewithallapplicablelawsandregulations(collectively,the“Share Purchase Mandate”);and

(b) todealwith theSharespurchasedoracquiredby theCompanyunder theSharePurchaseMandateinaccordancewiththeConstitutionoftheCompany,whetherto(i)deemsuchSharesascancelleduponpurchaseoracquisition;(ii)holdsuchSharesastreasuryshares;and/or(iii)otherwisedealwithsuchSharesinthemannerprovidedandtothefullestextentpermittedundertheCompaniesAct,

beandisherebyauthorisedandapprovedgenerallyandunconditionally;

(2) unlessvariedorrevokedbyanordinaryresolutionofShareholdersoftheCompanyingeneralmeeting,theauthorityconferredontheDirectorspursuanttotheSharePurchaseMandatemaybeexercisedbytheDirectorsatanytimeandfromtimetotimeduringtheperiodcommencingfromthedateofthepassingofthisResolutionandexpiringontheearliestof:

(a) thedateonwhichthenextannualgeneralmeetingoftheCompanyisheldorrequiredbylawtobeheld;

(b) thedateonwhichpurchasesofSharespursuanttotheSharePurchaseMandatearecarriedouttothefullextentmandated;and

(c) the date on which the authority conferred by the Share Purchase Mandate, if renewed, isrevokedorvariedbytheCompanyingeneralmeeting;

(3) inthisResolution:

“Maximum Limit”means10%oftheissuedShares(excludingtreasuryshares)asatthedateofthepassingofthisResolution;

“Maximum Price”inrelationtoaSharetobepurchasedoracquired,meansanamount(excludingancillaryexpensessuchasbrokerage,commission,stampduties,applicablegoodsandservicestax,clearancefeesandotherrelatedexpenses)notexceeding:

(a) inthecaseofanOn-MarketPurchase,105%oftheaverageoftheclosingmarketpricesoftheSharesoverthelastfive(5)consecutiveMarketDaysonwhichtheSharesaretransactedontheSGX-ST,immediatelyprecedingthedateoftheOn-MarketPurchasebytheCompanyanddeemedtobeadjustedforanycorporateactionthatoccursaftertherelevantfive(5)MarketDayperiod;and

(b) inthecaseofanOff-MarketPurchase,120%oftheaverageoftheclosingmarketpricesoftheSharesoverthelastfive(5)consecutiveMarketDaysonwhichtheSharesaretransactedontheSGX-ST,immediatelyprecedingthedayonwhichtheCompanymakesanannouncementofitsintentiontomakeanofferforthepurchaseoracquisitionofSharesfromShareholders,statingthepurchaseprice(whichshallnotbemorethantheMaximumPricecalculatedontheforegoingbasis)foreachShareandtherelevanttermsoftheequalaccessschemeforeffectingtheOff-MarketPurchase;and

“Market Day”meansadayonwhichtheSGX-STisopenfortradinginsecurities;and

(4) theDirectorsand/oranyofthembeandareherebyauthorisedtocompleteanddoallsuchactsandthings(includingexecutingsuchdocumentsasmayberequired)astheyand/orhemayconsiderdesirable,expedientornecessarytogiveeffecttothetransactionscontemplatedand/orauthorisedbythisResolution.[seeexplanatorynote(iii)]

(Resolution 9)

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ByOrderoftheBoard

TeoMengKeongChanLaiYinJointCompanySecretaries

Singapore

Dated:11April2016

Explanatory Notes:

(i) ThedetailedinformationofDrJohnChenSeowPhun,MrTamWaiandMrHoNeeKitcanbefoundunderthesectionentitled‘BoardofDirectors’onpage9oftheAnnualReport.SaveforMrHoNeeKitandMrTamWaiwhoarealsosubstantialshareholdersholding12.88%and12.84%oftheCompany’ssharecapitalrespectively, therearenorelationships(includingimmediate familyrelationships)betweentheseDirectorsand theotherDirectors(except forMrChingHengYang,MrHoNeeKitandMrTamWaiwhere theyareconcertparties),theCompanyorits10%shareholders.

(ii) Ordinary Resolution 8proposedinitem7above,ifpassed,willauthoriseandempowertheDirectorsoftheCompanyfromthedateoftheaboveMeetinguntilthenextAGMtoissuesharesand/orconvertiblesecuritiesin theCompanyup toanamountnotexceeding inaggregate50%of the totalnumberof issuedsharesexcludingtreasurysharesofwhichthetotalnumberofsharesandconvertiblesecuritiesissuedotherthanonapro-ratabasistoexistingshareholdersshallnotexceed20%ofthetotalnumberofissuedsharesexcludingtreasurysharesoftheCompanyatthetimetheresolutionispassed,forsuchpurposesastheyconsiderwouldbeintheinterestsoftheCompany.Thisauthoritywill,unlessrevokedorvariedatageneralmeeting,expireatthenextAGMoftheCompany.

(iii) Ordinary Resolution 9 proposedinitem8,ifpassed,willempowertheDirectorsoftheCompanyfromthedateofAGMuntilthenextofAGMoftheCompanyorthedatebywhichthenextAGMoftheCompanyisrequiredbylawtobeheld,orthedateonwhichtheauthoritycontainedintheSharePurchaseMandateisvariedorrevokedbytheCompanyinageneralmeetingorthedateonwhichSharePurchasearecarriedouttothefullextentmandated,whicheverisearlier,topurchaseorotherwiseacquireordinarysharesinthecapitaloftheCompanybywayofmarketpurchasesoroff-marketpurchasespursuanttoanequalaccessschemeofuptotenpercentum(10%)ofthetotalnumberofissuedshares(excludingtreasuryshares)inthecapitaloftheCompanyatthepriceofuptobutnotexceedingtheMaximumPriceasdefinedintheAppendixdated11April2016.The rationale for, theauthorityand limitationon, thesourcesof funds tobeused for thepurchaseoracquisitionincludingtheamountoffinancingandtheillustrativefinancialeffectsofthepurchaseoracquisitionofordinarysharesbytheCompanypursuanttotheSharePurchaseMandateontheauditedconsolidatedfinancialstatementsoftheCompanyforthefinancialyearended31December2015aresetoutingreaterdetailintheAppendixdated11April2016.

Notes:

1. AMemberentitledtoattendandvoteattheAnnualGeneralMeeting(the“AGM”)isentitledtoappointnotmorethantwo(2)proxiestoattendandvoteinhis/herstead.AproxyneednotbeaMemberoftheCompany.

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2. Whereamember(other thanaRelevant Intermediary)appoints two(2)proxies,he/sheshallspecify theproportionofhis/hershareholdingtoberepresentedbyeachproxyintheinstrumentappointingtheproxies.

3. A Relevant Intermediary may appoint more than two (2) proxies, but each proxy must be appointed toexercisetherightsattachedtodifferentshareorsharesheldbyhim(whichnumberandclassofsharesshallbespecified).

“RelevantIntermediary”means:

a) abankingcorporationlicensedundertheBankingAct(Cap.19)orawholly-ownedsubsidiaryofsuchabankingcorporation,whosebusinessincludestheprovisionofnomineeservicesandwhoholdssharesinthatcapacity;or

b) apersonholdingacapitalmarketsserviceslicensetoprovidecustodialservicesforsecuritiesundertheSecuritiesFuturesAct(Cap.289)andwhoholdssharesinthatcapacity;or

c) theCentralProvidentFundBoardestablishedbytheCentralProvidentFundAct(Cap.36),inrespectofsharespurchasedunderthesubsidiarylegislationmadeunderthatActprovidingforthemakingof investments from thecontributionsand intereststanding to thecreditofmembersof theCentralProvidentFund,iftheBoardholdsthosesharesinthecapacityofanintermediarypursuanttotheorinaccordancewiththatsubsidiarylegislation.

4. CompletionandreturnofhisinstrumentappointingaproxyshallnotprecludeamemberfromattendingandvotingattheMeeting.Anyappointmentofaproxyorproxiesshallbedeemedtoberevokedifamemberattends themeeting inperson,and insuchevent, theCompany reserves the right to refuse toadmitanypersonorpersonsappointedundertheinstrumentofproxytotheAGM.

5. TheinstrumentappointingaproxymustbedepositedattheregisteredofficeoftheCompanyat8TuasDrive1,Singapore638675notlessthanforty-eight(48)hoursbeforethetimeappointedforholdingtheAGM.

6. Theinstrumentappointingaproxyorproxiesmustbeunderthehandoftheappointororofhisattorneydulyauthorisedinwriting.Where the instrumentappointingaproxyorproxies isexecutedbyacorporation, itmustbeexecutedeitherunderitssealorunderthehandofanofficerorattorneydulyauthorised.Wheretheinstrumentappointingaproxyorproxiesisexecutedbyanattorneyonbehalfoftheappointor,theletterorpowerofattorneyoradulycertifiedcopythereofmustbelodgedwiththeinstrument.

7. AcorporationwhichisamembermayauthorisebyresolutionofitsdirectorsorothergoverningbodysuchpersonasitthinksfittoactasitsrepresentativeattheAGM,inaccordancewithSection179oftheCompaniesAct,Chapter50ofSingapore.

8. InvestorswhohaveusedtheirCPFmonies(“CPFInvestors”)tobuysharesintheCompanymayattendandcasttheirvoteatthemeetinginperson.CPFInvestorswhoareunabletoattendthemeetingbutwouldliketovote,mayinformCPFApprovedNomineestoappointChairmanoftheMeetingtoactastheirproxy,inwhichcase,theCPFInvestorshallbeprecludedfromattendingthemeeting.

General:

TheCompanyshallbeentitledtorejecttheinstrumentappointingaproxyorproxiesifitisincomplete,improperlycompletedorillegibleorwherethetrueintentionsoftheappointorarenotascertainablefromtheinstructionsoftheappointorspecifiedintheinstrumentappointingaproxyorproxies.Inaddition,inthecaseofSharesenteredintheDepositoryRegister,theCompanymayrejectanyinstrumentappointingaproxyorproxieslodgedifthemember,beingtheappointor,isnotshowntohaveSharesenteredagainsthisnameintheDepositoryRegisterasatseventytwo(72)hoursbeforethetimeappointedforholdingtheAGM,ascertifiedbyTheCentralDepository(Pte)LimitedtotheCompany.

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NOTICE IS HEREBY GIvEN,subjecttotheshareholders’approvaltotheproposedfinaldividendattheforthcomingAnnualGeneralMeeting,theShareTransferBooksandRegisterofMembersoftheCompanywillbeclosedon5May2016at5.00p.m.forthepurposeofdeterminingtheentitlementofshareholdersoftheCompany.DulycompletedtransfersinrespectofSharesreceivedbytheCompany’sShareRegistrar,BoardroomCorporate&AdvisoryServicesPteLtd,at50RafflesPlace,#32-01SingaporeLandTower,Singapore048623,upto5.00p.m.on5May2016willberegisteredtodetermineShareholders’entitlementstotheproposedtaxexempt(one-tier)finaldividend.Thetaxexempt(one-tier)finaldividendof1.0centperordinaryshare,ifapprovedattheAnnualGeneralMeeting,willbepaidon13May2016.

Personal data privacy

By submitting an instrument appointing a proxy(ies) and/or representative(s) to attend, speak and vote at the Annual General Meeting (“AGM”) and/or any adjournment thereof, a member of the Company (i) consents to the collection, use and disclosure of the member’s personal data by the Company (or its agents) for the purpose of the processing and administration by the Company (or its agents) of proxies and representatives appointed for the AGM (including any adjournment thereof) and the preparation and compilation of the attendance lists, minutes and other documents relating to the AGM (including any adjournment thereof), and in order for the Company (or its agents) to comply with any applicable laws, listing rules, regulations and/or guidelines (collectively, the “Purposes”), (ii) warrants that where the member discloses the personal data of the member’s proxy(ies) and/or representative(s) to the Company (or its agents), the member has obtained the prior consent of such proxy(ies) and/or representative(s) for the collection, use and disclosure by the Company (or its agents) of the personal data of such proxy(ies) and/or representative(s) for the Purposes, and (iii) agrees that the member will indemnify the Company in respect of any penalties, liabilities, claims, demands, losses and damages as a result of the member’s breach of warranty.

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FU YU CORPORATION LIMITED CompanyRegistrationNo.198004601C(IncorporatedInTheRepublicofSingapore)

Personal data privacy

By submitting an instrument appointing a proxy and/or representative, the Member accepts and agrees to the personal data privacy terms set out in the Notice of AGM dated 11 April 2016.

PROxY FORM(PleaseseenotesoverleafbeforecompletingthisForm)

I/We, of beingamember/membersofFuYuCorporationLimited(the“Company”),herebyappoint: Name NRIC/Passport No. Proportion of Shareholdings

No. of Shares %Address

and/or(deleteasappropriate)

Name NRIC/Passport No. Proportion of ShareholdingsNo. of Shares %

Address

orfailingtheperson,oreitherorbothofthepersons,referredtoabove,theChairmanoftheMeetingasmy/ourproxy/proxiestovoteforme/usonmy/ourbehalfattheAGMoftheCompanytobeheldatBridgeRooms,Level2,RafflesMarina,10TuasWestDrive,Singapore638404onTuesday,26April2016at2.30p.m.andatanyadjournmentthereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the AGM as indicatedhereunder.IfnospecificdirectionastovotingisgivenorintheeventofanyothermatterarisingattheAGMandatanyadjournmentthereof,theproxy/proxieswillvoteorabstainfromvotingathis/herdiscretion.Theauthorityhereinincludestherighttodemandortojoinindemandingapollandtovoteonapoll.

(Please indicate your number of votes “For” or “Against” within the box provided.)

No. Resolutions relating to: No. of votes For*

No. of votes Against*

Ordinary Business1 ApprovalofDirectors’StatementandAuditedFinancialStatementsfortheyearended

31December20152 Approvaloftaxexempt(one-tier)finaldividendof1.0centperordinaryshareforthe

financialyearended31December20153 Re-electionofDrJohnChenSeowPhunasaDirector4 Re-electionofMrTamWaiasaDirector5 Re-electionofMrHoNeeKitasaDirector6 ApprovalofDirectors’feesofS$258,000forthefinancialyearending31December

2016,payablequarterlyinarrears7 Re-appointmentofMessrsKPMGLLPasAuditors

Special Business8 Authoritytoissuenewshares9 ProposedRenewalofSharePurchaseMandate

*Ifyouwishtouseallyourvotes“For”or“Against”,pleaseindicatewithan“X”withintheboxprovided.Otherwisepleaseindicatethenumberofvotes.

Datedthis dayof 2016TotalnumberofSharesin: No.ofShares

(a)CDPRegisterSignatureofShareholder(s) (b)RegisterofMembersor,CommonSealofCorporateShareholder Deletewhereinapplicable

IMPORTANT

1. Pursuant to Section 181(1C) of the Companies Act,Cap. 50 of Singapore (the “Companies Act”), RelevantIntermediariesmayappointmorethantwo(2)proxiestoattend,speakandvoteattheMeeting.

2. ThisProxyFormisnotvalidforusebyCPFinvestorsandshallbeineffectiveforall intentsandpurposesifusedorpurportedtobeusedbythem.

3. CPF investors who wish to attend the Meeting as anobserver must submit their requests through their CPFApprovedNomineeswithinthetimeframespecified.Iftheyalsowishtovote,theymustsubmittheirvotinginstructionsto the CPF Approved Nominees within the time framespecifiedtoenablethemtovoteontheirbehalf.

"

Notes :

1. PleaseinsertthetotalnumberofSharesheldbyyou.IfyouhaveSharesenteredagainstyournameintheDepositoryRegister(asdefinedinsection81SFoftheSecuritiesandFuturesAct(Chapter289)ofSingapore),you should insert that number of Shares. If you have Shares registered in your name in the Register ofMembers,youshould insert thatnumberofShares. IfyouhaveSharesenteredagainstyournamein theDepositoryRegisterandSharesregisteredinyournameintheRegisterofMembers,youshouldinserttheaggregatenumberofSharesenteredagainstyourname in theDepositoryRegisterand registered inyournameintheRegisterofMembers.Ifnonumberisinserted,theinstrumentappointingaproxyorproxiesshallbedeemedtorelatetoalltheSharesheldbyyou.

2. AmemberoftheCompany(otherthanaRelevantIntermediary*),entitledtoattendandvoteatameetingoftheCompanyisentitledtoappointone(1)ortwo(2)proxiestoattendandvoteinhis/herstead.AproxyneednotbeamemberoftheCompany.

3. Whereamember(other thanaRelevant Intermediary*)appoints two(2)proxies, theappointmentsshallbeinvalidunlesshe/shespecifiestheproportionofhis/hershareholding(expressedasapercentageofthewhole)toberepresentedbyeachproxy.

4. A Relevant Intermediary may appoint more than two (2) proxies, but each proxy must be appointed toexercisetherightsattachedtoadifferentshareorsharesheldbyhim(whichnumberandclassofsharesshallbespecified).

“RelevantIntermediary”means:

a) abankingcorporationlicensedundertheBankingAct(Cap.19)orawholly-ownedsubsidiaryofsuchabankingcorporation,whosebusinessincludestheprovisionofnomineeservicesandwhoholdssharesinthatcapacity;or

b) apersonholdingacapitalmarketsserviceslicencetoprovidecustodialservicesforsecuritiesundertheSecuritiesFuturesAct(Cap.289)andwhoholdssharesinthatcapacity;or

c) theCentralProvidentFundBoardestablishedbytheCentralProvidentFundAct(Cap.36),inrespectofsharespurchasedunderthesubsidiarylegislationmadeunderthatActprovidingforthemakingof investments from thecontributionsand intereststanding to thecreditofmembersof theCentralProvidentFund,iftheBoardholdsthosesharesinthecapacityofanintermediarypursuanttoorinaccordancewiththatsubsidiarylegislation.

5. Completionand returnof this instrumentappointingaproxyshallnotprecludeamember fromattendingandvotingattheAGM.AnyappointmentofaproxyorproxiesshallbedeemedtoberevokedifamemberattendstheAGMinperson,andinsuchevent,theCompanyreservestherighttorefusetoadmitanypersonorpersonsappointedundertheinstrumentofproxytotheAGM.

6. TheinstrumentappointingaproxyorproxiesmustbedepositedattheregisteredofficeoftheCompanyat8TuasDrive1,Singapore638675notlessthanforty-eight(48)hoursbeforethetimeappointedfortheAGM.

7. Theinstrumentappointingaproxyorproxiesmustbeunderthehandoftheappointororofhisattorneydulyauthorisedinwriting.Where the instrumentappointingaproxyorproxies isexecutedbyacorporation, itmustbeexecutedeitherunderitssealorunderthehandofanofficerorattorneydulyauthorised.Wheretheinstrumentappointingaproxyorproxiesisexecutedbyanattorneyonbehalfoftheappointor,theletterorpowerofattorneyoradulycertifiedcopythereofmustbelodgedwiththeinstrument.

8. Acorporationwhichisamembermayauthorisebyresolutionofitsdirectorsorothergoverningbodysuchperson as it thinks fit to act as its representative at theMeeting, in accordancewith Section179 of theCompaniesAct,Chapter50ofSingapore.

9. InvestorswhohaveusedtheirCPFmonies(“CPFInvestors”)tobuysharesintheCompanymayattendandcasttheirvoteatthemeetinginperson.CPFInvestorswhoareunabletoattendthemeetingbutwouldliketovote,mayinformCPFApprovedNomineestoappointChairmanoftheMeetingtoactastheirproxy,inwhichcase,theCPFInvestorshallbeprecludedfromattendingthemeeting.

General:

TheCompanyshallbeentitledtorejecttheinstrumentappointingaproxyorproxiesifitisincomplete,improperlycompletedorillegible,orwherethetrueintentionsoftheappointorarenotascertainablefromtheinstructionsoftheappointorspecifiedintheinstrumentappointingaproxyorproxies.Inaddition,inthecaseofSharesenteredintheDepositoryRegister,theCompanymayrejectanyinstrumentappointingaproxyorproxieslodgedifthemember,beingtheappointor,isnotshowntohaveSharesenteredagainsthisnameintheDepositoryRegisterasatseventytwo(72)hoursbeforethetimeappointedforholdingtheAGM,ascertifiedbyTheCentralDepository(Pte)LimitedtotheCompany.