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NO RESPONSIBILITY liablilty will be accepted for errors

CUSTOMERSARETHEREFOREURGEDTOCHECKTHOROUGHLYBEFORE

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2002

Venture Corporation Limited5006 Ang Mo Kio Avenue 5#05-01/12 TECHplace llSingapore 569873

CONTENTS

INTRODUCTION 1

MISSION MADE POSSIBLE 2

YEAR IN REVIEW 8

SERVICES & STRENGTHS 12

BOARD OF DIRECTORS 20

KEY MANAGEMENT 22

GROUP OF COMPANIES 24

FINANCIAL REPORT 25

02ANNUAL REPORT 2002

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FINANCIAL HIGHLIGHTSMISSION

We aim to be the best and most reliable Electronics ServicesProvider and Strategic Global Partner for successful globalcompanies, providing a fully integrated range of ElectronicsManufacturing Services (EMS), Original Design Manufacturing(ODM) and e-Fulfillment Services (EFS).

CORE VALUES

– Relentless pursuit of excellence – Providing total customer satisfaction – Encouraging our employees to realize their full potential– Building strong cohesion and teamwork– Creativity and innovation

CONSOLIDATED FINANCIAL PERFORMANCE (S$ MILLION)

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

Revenue 104.8 191.3 249.7 649.1 708.0 730.7 951.0 1,456.4 1,430.9 2,366.3

Profit before tax 10.1 21.1 25.5 45.8 58.3 74.9 91.3 115.9 143.7 194.2

Profit after tax 9.8 19.4 21.6 36.2 47.7 63.2 82.9 105.1 134.7 181.1

Total Assets 63.4 119.5 155.9 306.4 398.0 475.2 602.0 759.2 886.0 1,427.1

Total Liabilities 26.7 61.2 75.7 134.0 175.1 178.9 187.0 224.3 220.6 484.1

Shareholders' Equity 36.7 58.3 80.2 172.4 222.9 296.3 415.0 534.9 665.4 943.0

PBT margin (%) 9.6% 11.0% 10.2% 7.1% 8.2% 10.3% 9.6% 8.0% 10.0% 8.2%

PAT margin (%) 9.4% 10.1% 8.7% 5.6% 6.7% 8.6% 8.7% 7.2% 9.4% 7.7%

EPS (cents) 14.4 28.3 13.9 22.9 26.0 32.5 38.3 45.7 58.3 77.1

Concept and Design by Equuswww.equus-design.com

CAPITAL EXPENDITURE (1998 -2002) S$MILLIONREVENUE CONTRIBUTION BY PRODUCT SEGMENT

ACTIVITY CONTRIBUTION BY

LINE OF BUSINESS

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SHAREHOLDERS' EQUITY S$MILLION

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EARNINGS PER SHARE SINGAPORE CENTS

0 10 20 30 40 50 60 70 80

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REVENUE S$MILLION

0 500 1000 1500 2000 2500

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0 50 100 150 200

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INTRODUCTION

In pursuit of our mission, we have made it our aim to be thevery best Electronics Services Provider by adding more andmore value to our customers. So from electronics manufacturingservices, we have moved both upstream and downstream inthe value chain to become an end-to-end total solutionsprovider : offering only the best solutions for our customers. As aresult, we have become the preferred Strategic Global Partnerthat we set out to be and have achieved 14 years of record-breaking growth. In this annual report, we give an insight intothe value-driven qualities which underlie this success, andwhich will enable Venture to continue to be the best for manyyears to come.

MISSION MADE POSSSIBLEMISSION MADE POSSIBLE

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Venture Annual Report 2002 03

SYNERGISTIC RELATIONSHIPS

Venture takes pride in its ability to create synergistic relationshipsamong its employees, and with its customers and business partners worldwide. Based on mutual trust and respect, relationsamong employees have given rise to the ‘Venture Team Spirit’.This team spirit has spurred us on to proactively cultivate an in-depth understanding of the needs, requirements andexpectations of our customers. Likewise, we are developingmutually beneficial relationships with our pool of suppliers. Thiswinning formula, coupled with flawless execution of ourprocesses, has resulted in premier-quality solutions that are costeffective, reliable and flexible, gaining us stamps of approvalfrom our customers and business partners.

CREATING SYNERGISTIC RELATIONSHIPS AROUND THE WORLD


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From the designing, manufacturing and fulfillment of a productto the way we manage our financial and human resources,innovation is highly-valued and encouraged at all levels. It drivesour strategies and determines the configuration of our businesson a global scale. Our multifarious and creative businessprocesses that are continually being developed to achieve total customer satisfaction are a microcosm of this spirit of innovation.

INNOVATIONS ABOUND AT EVERYLEVEL THROUGHOUT VENTURE’SVALUE CHAIN

INNOVATION


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‘VENTURE INTELLIGENCE’ – A BLENDOF KNOWLEDGE, SKILLS AND VALUES

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Being a world-class total services provider demands morethan just the right infrastructure, technological prowess andtechnical expertise. It has to be underpinned by a set of strongcore values. Our Core Values form the basis of our businessgoals and practices. They shape our attitude and enthusiasmtowards our work and direct us in the way we relate to our customers, colleagues and business partners. This ‘VentureIntelligence’, deeply ingrained in the organisation, willcontinue to play a significant part in making us the preferredStrategic Global Partner for successful electronics companiesaround the world.

INTELLIGENCE


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GOPALA ACHUTA MENON

CHAIRMANWONG NGIT LIONG

GROUP PRESIDENT & CEO

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YEAR IN REVIEW

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For the electronics industry as a whole, 2002 was a yearof considerable challenges marked by overall weaknessin end-market demand, unabated price erosion, plant closures and low capacity utilization.

For Venture Corporation however, the year was marked bycontinued growth in every area of our business. This successwe attribute to our belief in commitment – commitmentto improving all aspects of our operations and to buildingquality customer relationships. Together with our focus onstrategic expansion and driving down costs, we were ableconsequently to realize significant improvements in bothour top and bottom lines.

Performance Review

We are happy to report that for the financial year ended31 December 2002, Group turnover rose 65% to S$2.37billion, and net profit attributable to shareholders wasS$181 million, up 35% over the previous year. Earnings pershare was 77.1 cents, up from 58.3 cents in 2001. Topping the record performance of the previous year, thesesignificant gains in revenue and profit were achieveddespite what was generally acknowledged to be one of theworst years in history for the industry.

All three lines of business continued to register an upwardgrowth trend. The Electronics Manufacturing Services(EMS) business remained the biggest contributor to theGroup’s activities at 77%, while the E-FulfillmentServices (EFS) and the Original Design Manufacturing(ODM) businesses contributed 12% and 11% respectively.The combined contribution from EFS and ODM activitiesof 23%, compared to 19% in 2001 is in line with ourstrategy to better balance the three activities to providesuperior end-to-end solutions for our customers. As areflection of its commitment to this strategy, the Groupalso changed its name from “Venture Manufacturing(Singapore) Limited” to “Venture Corporation Limited” inMay last year.

The Group also achieved healthy revenue growth in allproduct segments, due to increased business from existingcustomers as well as other business from new customerssourcing for lower cost solutions in Asia.

Contributing 27% to Group turnover, the ComputerPeripherals/Data Storage product segment registered thehighest year-on-year growth of 129% compared to 2001.The Printing/Imaging, and Networking/Communicationsproduct segments, contributed 40% and 25% respectively.

Year-on-year growth was also healthy for both segments,with Printing/Imaging up 59%, and Networking/Communications higher by 31%. Products in the “Others”category contributed 8% to group revenue, a year-on-yearincrement of an impressive 77%.

Improving Our Operations

In terms of human resources, every effort was made toensure that we continued to attract and retain the bestpeople, at all levels of the organization. Staff strength wasboosted at our Shanghai and Barcelona offices, in line withour strategy of expanding our presence in China and Europe.Significant additions were also made to our Research &Development (R&D) teams, particularly in Spain,Malaysia, and the USA, as part of our effort to accelerategrowth in our ODM business.

The Group successfully completed the acquisition of a67% interest in Univac Precision Engineering Pte. Ltd.in July. This acquisition, which enhances our engineeringdesign skills and expands our capabilities in strategiccomponents expertise, allowed the Group to partner withcustomers on several joint R&D projects. These includedthe development of a new generation of ink cartridges,lighting systems for the automotive industry, and the world’sfirst 96-cavity mould for the manufacturing of high-precisionplastic components for the medical industry.

The Group’s operations in Malaysia were enhanced throughthe addition of two new facilities in the course of the year,and through the acquisition of Iomega (Malaysia) Sdn. Bhd.in November. Iomega’s plant, with 385,000 square feet ofmanufacturing space as well as automated and semi-automated manufacturing systems, full laboratory supportfor analysis and development of storage, communicationsand other related electronics products, will complementthe Group’s existing operations in Malaysia.

To position itself for greater opportunities arising fromthe rapidly growing Chinese economy, the Group inked alease for a new facility in Shanghai spanning about100,000 square feet.

Equipped with Surface Mount Technology (SMT) andtop-level lines, the facility underwent pilot runs in November,and has since been fully operational. Central to this is thedevelopment of a new customer base and a new suppliercluster, which is expected to provide the Group with newavenues for increased revenue and profit in China in the future.



GOPALA ACHUTA MENON

CHAIRMANWONG NGIT LIONG

MANAGING DIRECTOR

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Building Quality Customer Relationships

Cultivating quality relationships with existing customerscontinued to be a Group priority, as did acquiring newcustomers. In spite of a soft market, we captured greatermarket share by increasing the value of contracts withexisting customers, and by adding new customers toour portfolio.

In many cases, our services were extended to cover newproduct initiatives, repair work, and product design. Onthe back of the Iomega Malaysia acquisition, we enteredinto an exclusive agreement to manufacture Iomega Zipdrives for a period of five years, with non-exclusive rightsto provide Iomega with full turnkey system-build,test systems and process development, as well ase-fulfillment services.

Our partnership with Hewlett-Packard (HP) was deepenedthrough a collaborative effort to produce VP2020, arevolutionary digital colour label printer designed forindustrial use. Leveraging on HP’s advanced print headsand inkjet technology, our team of R&D engineers focusedon the development of the variable information handlingand on-demand printing features of this breakthroughproduct. With a cost-effective precision mechanism ableto reproduce consistent-quality labels under heavy usage,this printer is not just a showcase for the Group’s designcapabilities, but is also an excellent example of our commitment to the establishment of long-standing partnerships with our customers.

Another milestone was our global strategic alliance withAgilent Technologies in November 2002, whereby themajority of Agilent's manufacturing operations in Spokanewere transferred to Venture’s existing facilities in theU.S.A. and Malaysia. Under this arrangement, we willprovide prototyping and printed circuit board assemblyservices for Agilent, leveraging on our established cluster ofexcellence in South East Asia and our ability to providesuperior end-to-end value chain management solutions atlower cost. In addition, this collaboration enables the Groupto enhance our technical expertise in the manufacturing oflow-volume, high-mix printed circuit assemblies and tostrengthen our capabilities in process and test development,value engineering, rapid prototyping, product and processtransfer to manufacturing operations, and materialsmanagement.

YEAR IN REVIEW

CAPITAL EXPENDITURE (1998 -2002) S$MILLION

0 10 20 30 40 50 60 70

2002

2001

2000

1999

1998

Printing andImaging 40%

Computer Peripheralsand data storage 27%

Others 8%

Networking andCommunications 25%

REVENUE CONTRIBUTION BY PRODUCT SEGMENT

10 Venture Annual Report 2002

REVENUE GROWTH BY PRODUCT SEGMENT

2002 vs. 2001

Printing and Imaging 59%

Computer Peripheraland Data Storage 129%

Networking andCommunications 31%

Others 77%

Outlook

We remain cautiously optimistic about our outlook for 2003.Cautious because economic uncertainties prevail, and thereare downside risks in the event of protracted conflict inthe Middle East. Optimistic because we have a goodstrategy and an innovative business model which shouldenable us to overcome all challenges and further improveour market share.

On the manufacturing front, we expect that our expansionin Malaysia will have a substantially positive impact onrevenues, as will the ramp-up in activities in our facility inChina. The Group is also making significant headway bothin increasing production of niche-category products forthe medical and networking/communications industries, andin securing new customers, particularly in Europe andNorth Asia.

As for ODM, we will leverage our strength in new productintroduction (NPI) to expand into product areas such asmulti-function printers, mobile computing, medicalequipment, servers and systems integration. The expansionof our R&D infrastructure in accordance with our regionalcluster strategy will mean that we are able to deliver evenbetter value-add to our customers, wherever they are located.

EFS should continue to experience growth as it expandsinto key global markets in the USA, Europe, South Eastand North East Asia. In line with our objective of providingcustomers with a holistic one-stop services solution, wewill continue to build and enhance the infrastructure tosupport this business.

Overall, despite the soft market conditions, we believethat opportunities abound for us to sustain our solidprogress throughout 2003. Our strong cash positionplaces us well in the eyes of vendors and customersalike, and allows us to consider strategic investments andexpansion programmes as opportunities arise. Ourcutting-edge technical capabilities and the quality of ouroperations are recognized as being among the bestworldwide. We have managed to control our costs well,and our cost structure is competitive. The global networkwe have built provides customers with an assurance ofour ability to supply on-demand worldwide.

However, we are keenly aware that competition is neverfar behind, and we have not been complacent. In thedynamic world of outsourcing, our differentiating factor

lies in our ability to add value by exercising creativity indeveloping the right solutions to meet the differentrequirements of our customers, and we will keep buildingon our technical competencies to ensure that we staymany steps ahead of our competitors.

Appreciation

We are grateful to our shareholders for the support theyhave given over the long-term. We are dedicated tobuilding shareholder value on a sustainable basis, and todelivering consistent stock dividends. For the year 2002,your Board has proposed a final dividend of 15% and abonus dividend of 15% on a tax-exempt basis.

Our achievements in 2002 would not have been possiblewithout the continued support of our customers. Theirconfidence in our ability to deliver above expectation isan encouragement in itself. Likewise, the partnershipswe have forged with them have enriched our businessexperience. We would like to place on record our thanksfor their guidance and encouragement throughout the year.

We also want to pay tribute to our employees worldwidefor their dedication and commitment to the Group. Theirloyalty and dedication to delivering the best havecontributed invaluably to the Group’s performance. Theirwillingness to rise to new challenges is an attribute weare tremendously proud of.

Our thanks also go to our Board of Directors for theirdedication and counsel. We treasure and appreciate thevalue they bring as advisors to the Group.

We also thank our business partners, suppliers and associates for their confidence and unfailing support forthe Group.

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SERVICES & STRENGTHS

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End-to-End Value Chain Solutions

From our origins as a provider of EMS, we have over theyears expanded our scope of activities to include ODMfor various product segments, as well as EFS, coveringthe full spectrum from distribution and end-user deliveryto after-sales services in repairs and spare parts management. This is a reflection of our commitment tocontinuously add value to our customers, as well as our ability to anticipate and adapt to the changing business environment.

The focus of Venture has, in general, been on productswith high technology and high value-added content, andwith the cultivation of broader skill sets, the Group hasmanaged to achieve good product diversification acrossthe volume-mix spectrum. Over the past years, Venturehas attracted considerable high value, low-volume high-mix (LVHM) business, as well as high-volume high-mixand high-volume medium-mix business. Our smart-planningfeature allows for rapid set-ups for the LVHM manufacturing environment, as well as the ability to optimize utilization for high-volume production runs.

The accelerating demand we have experienced forhigher value-added services in recent years is partly dueto the desire of original equipment manufacturers(OEMs) to lower their costs by outsourcing new productdesign work and e-fulfillment services, as well as post-manufacturing activities. To this end we help ourcustomers by providing them with what they are lookingfor: a seamless, end-to-end value chain managementsystem that promises product quality and cost efficiency.

Our fully-integrated range of ODM, EMS and EFS capabilities means we are able to offer our customersconsiderable savings, particularly in the cost and timeusually incurred in the transfer of knowledge andprocesses from the prototyping and NPI stages to production ramp. This offer is supported by a universalenterprise resource planning system, which facilitatesinformation flow and provides the necessary ITinfrastructure to link our suppliers and strategic partnersall over the world to ensure up-to-the-minute informationaccessibility.

Enhancing these capabilities, our acquisition of UnivacPrecision Engineering Pte. Ltd. allows us to offer designand production expertise in complex moulds for

manufacturing high-precision plastic components, tooland die-making, and metal stamped parts, as well as sub-assembly of metal and plastic components.

Customers are also increasingly outsourcing both theproduction and delivery of products, and the provision ofcomprehensive after-sales support services in areas suchas repair, cost reduction by redesign, annualized failurerate (AFR) management and technical support. In orderto better manage the rapidly changing demands typical ofthe outsourcing world, we are boosting our infrastructurefurther to establish a “virtual spares” system by buildinga seamless connection with our partners and componentsuppliers.

In all the above ways Venture is differentiating itself fromtraditional service providers who are generally focusedon specific areas of contract manufacturing, productdesign and logistics. With OEMs increasingly looking toreduce cost through out-sourcing in Asia, our proventrack record in being able to meet the varying needs ofour customers positions us well to tap on this opportunity.


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Innovative Business Model

Clusters Of Excellence

The key to Venture’s success in improving manufacturingflexibility, quality, responsiveness and cost efficiency forboth the Group and its customers lies in its “Cluster ofExcellence” strategy. Such clusters have been establishedin three strategic regions, namely, South East Asia, USAand Europe. Over the past year the Group has also put insignificant effort to build a fourth North East Asia cluster.We have leased a new manufacturing facility in Chinawhere we have deployed key personnel and are in theprocess of setting up a design center. More significantly,the Group is also working with suppliers, customers andrelevant regulatory bodies to duplicate its South EastAsia supplier base in North East Asia, so that we can continue to deliver quality products and services to ourcustomers wherever they are.

Each cluster is fully-equipped to provide design, manufacturing and fulfillment services. In the South EastAsian cluster for example, Singapore’s high level ofdesign and engineering capabilities, together with ourestablished materials management, logistics and IT infrastructure, strategically complements the lower-costsupplier community and manufacturing environment inMalaysia and the Riau Islands, thereby facilitating theGroup’s ability to deliver good value to customers withina short period of time.

However, although each cluster is self-sufficient, theyhave been synergistically connected to form a globalenterprise. This extensive network allows us to draw onthe relative strengths of each cluster to create opportunities for the Group to optimize the utilization ofresources. A case in point would be a product that isconceptualized and prototyped in the USA, but is thenmanufactured in South East Asia. Under such anarrangement, the NPI and prototyping expertise providedby the US cluster would ensure that the quality of theproduct design is not compromised, while themanufacturing of the product in lower-cost South EastAsia would enable the Group to pass on its cost savingsto the customer.

Total Customer Satisfaction (TCS) Management

As a customer-centric organization, we are proud of ourTCS Management program. Dedicated TCS Managersand Champions are assigned to each customer to cultivate an in-depth understanding of the customer’s

business and processes. These TCS Managers aresupported by a team of program managers, production engineers, QA engineers, buyers, procurementengineers and logistics specialists, and will draw onthese resources to manage the each customer’s specificneeds. The team also work with the customer to devisean escalation path with regard to issues arising andfeedback, reducing response time from the Group. Suchclose partnerships between Venture and our customersrepresent a new business paradigm in which both partieshelp each other to grow their respective businesses. Forthis reason, forging strategic partnerships remain at theforefront of our priorities.

NPI Management

The development of a product is a complex processrequiring technological superiority and proven experiencein delivering first-class products to the end-users.Venture’s NPI team has extensive capabilities in the efficientdevelopment and management of manufacturingprocesses and production flow. Our NPI team comprisingR&D personnel and manufacturing engineers, is involvedearly in the design stage in areas such as design-for-manufacturing (DFM), test development, productioncycle time, and audit plan, to ensure that the product iscost-efficient in terms of manufacturing.

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Where potential problems are identified, the teamproposes modifications to the design to resolve theseissues before the mass production stage, ensuring aseamless flow from product development tomanufacturing. The NPI team is complemented byengineers from our Advanced Manufacturing and TestingCentre (AMTC) which provides value-added engineeringservices such as process technology development, testsystem development, six sigma processes, line design &automation, failure analysis and reliability testing.

Superior Technological Capabilities

With our sophisticated technical expertise andmanufacturing facilities, and a global team of engineerslocated in Asia, Europe and North America, our added-value capabilities position us well to meet our customers’requirements, whether it is in complete productdevelopment, radio-frequency (RF) power amplifierdesign, printed-circuit board (PCB) design, or qualificationof tooling to test development.

With many years of excellent track record in designingand manufacturing high-quality electronics products,such as complex PCB assemblies to integrated finishedproducts for OEMs who are leaders in their fields, ourcore competencies extend to the areas of electronicsand RF design, software development, mechanicaldesign, tools design, test development, systems integrationand testing. This mix of capabilities allows us to consistently deliver world-class product designs, andcoupled with a flawless execution of new product introduction activities, we ensure our customers aseamless transition to manufacturing.

Among the products we designed and manufactured in2002 were an advanced digital photo-finishing systemincorporating inkjet technology, a mobile inkjet printer,and another printer capable of printing on plastic andother uneven surfaces. With our highly-developed ITinfrastructure and other specialist technical expertise, weare also able to offer optimum supply-chain flexibility andreduced inventory cost by pushing the picking, electronicassembly, testing, kitting and packing activities farback in the supply chain, particularly in the case ofhigh-mix products.

We are committed to continually enhancing the buildingblocks of our technology, so as to improve our capabilitiesin ODM execution and product innovation.

Leveraging on our strength in printing and imaging, we haveenhanced our capabilities in embedded software design,ASIC design and system electronics design. We havealso acquired in-depth expertise in PC-based architecture,system software and drivers development. This extendedrepertoire of capabilities, together with a substantialexpansion of our R&D team, positions us well to capturenew business opportunities in other product segmentssuch as copiers, handheld scanners, and all-in-one printersfor personal and commercial use. This also provides anexcellent platform from which the Group can access newmarkets in the PDA and portable communicator arenas,and to develop new business in industrial PCs, networked storage devices and servers, RF power amplifier design, PCB design, systems integration andtest development.

With our technological know-how, our dedication to continuous improvement, and our global presence, thevalue proposition we aim to represent to our customersis one of a strategic partner of choice, with a longterm perspective.

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Venture Annual Report 2002 2120 Venture Annual Report 2002

BOARD OF DIRECTORS

Koh Lee Boon

Non-Executive Director

Mr Koh Lee Boon was appointed to theBoard in 1992. He is the Chairman of theNominating Committee and a member ofthe Audit Committee, the CompensationCommittee and the Share OptionCommittee. Mr Koh has more than 13years of managerial experience in twocompanies within the electronicsmanufacturing industry, where he alsoserved as Executive Director.

Mr Koh retired as Senior Vice Presidentand Partner of SEAVI International FundManagement in 1996, but continues to sit on its Board to date. He is also anindependent Board member of SEAVIVenture Management Pte Ltd andPentax-Schweizer Circuits Limited.

Mr Koh holds a BE(Hons) degree inelectrical engineering from the Universityof Malaya.

Wong Ngit Liong

Executive Director

Mr Wong Ngit Liong is the GroupPresident & CEO, and has beeninstrumental to the overall growth anddevelopment of its businesses. As anexecutive of the Board, he sits on theShare Option Committee and theNominating Committee. Prior to joiningVenture, Mr Wong spent more than 12years with Hewlett-Packard Company(HP) holding various managementpositions at headquarters Palo Alto(USA), Santa Clara and CupertinoDivisions, HP Singapore and HP Malaysia.

Mr Wong also sits on the Boards ofpublic-listed companies SIA EngineeringCompany and the Singapore Exchange,and also of local statutory bodies,namely the Economic DevelopmentBoard of Singapore, and InternationalEnterprise Singapore.

Among the recognitions accorded himwere the Ernst & Young Entrepreneurof the Year and Master EntrepreneurAward in 2002, and the SingaporeBusiness Time/DHL Worldwide ExpressBusinessman of the Year in 1998.

Mr Wong holds a 1st Class (Hons)degree in Electrical Engineering, andMS (EE) degree from the University ofCalifornia at Berkeley where he was aFulbright Scholar. He also holds anMBA degree with distinction fromMcGill University under the CanadianCommonwealth Fellowship.

Tan Choon Huat

Executive Director

Mr Tan Choon Huat holds the position ofVice President, EMS, and is responsiblefor the overall strategy and direction ofthe Group’s electronics manufacturingservices line of business worldwide.

Mr Tan has more than 30 years ofinternational experience in the electronicsindustry. He started his career withHewlett-Packard Company, and assumedmanagement positions in its offices inthe USA, Singapore and Malaysia in thecourse of his 17 years there.

Mr Tan holds a degree in ElectricalEngineering from the University ofLiverpool in the UK, and an MBA fromthe University of Santa Clara in California.

Soo Eng Hiong

Executive Director

Mr Soo Eng Hiong is the GeneralManager of Business Development,and is responsible for all new businessactivities and merger & acquisitiontransactions in relation to the Group.Prior to assuming the current position,Mr Soo spent a number of yearsoverseeing the Group’s operations inSingapore and Malaysia.

Mr Soo has extensive experience in theelectronics industry, and has been withthe Group for more than 15 years. Priorto joining Venture, he worked as anengineer with Hewlett-Packard Company,and also in a Sales and MarketingManagement, and Technical Supportposition in the Data Communicationindustry.

Mr Soo holds a degree in Electronicsfrom the University of Southampton inthe UK.

Gopala Achuta Menon

Non-Executive Chairman

Mr G.A. Menon is a founder-directorand Chairman of the Board. He is alsoChairman of the CompensationCommittee, and member of the AuditCommittee and the Share OptionCommittee. He has more than 30 yearsof experience in the electronics arena,including 15 years in various technicaland management positions in a multi-national company within the sector.

Mr Menon also serves as Chairman of theBoards of a number of other companiesengaged in the manufacturing ofsoftware, animation, electronicscomponents distribution, geographicalinformation systems, and the provisionelectronics services.

Mr Menon holds a Master’s degree inMathematics from Madras University andan MBA degree from Harvard University.

Cecil Vivian Richard Wong

Non-Executive Director

Mr Cecil Vivian Richard Wong hasserved on the Board since 1992, andcurrently also serves as Chairman ofthe Audit Committee and the ShareOption Committee. He is also a memberof the Compensation Committee andthe Nominating Committee.

Mr Wong has retired as partner ofErnst & Young International, afterspending more than 30 years there andin its predecessor companies, butcontinues to serve as the company’sHonorary Senior Consultant. He sits onthe Board of several other listedcompanies and continues to be activelyinvolved in social work, serving as eitheras Honorary Treasurer or Council Memberof several non-profit organizations. Inrecognition of his contribution to thecountry, he was awarded the PublicService Medal and Public Service Starby the President of Singapore in 1992and 2000 respectively.

Mr Wong holds a degree in Accountancyfrom Cambridge University’s FitzwilliamCollege.

(from left to right )

Tan Choon HuatWong Ngit LiongGopala Achuta MenonSoo Eng HiongKoh Lee BoonCecil Vivian Richard Wong

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(from left to right )

Wong Ngit LiongTan Choon HuatSoo Eng Hiong

Wong Chin TongPay Cher Wee

Bernard TsaiThian Nie Khian

Mark WettasingheTan Kian Seng

Joseph AdamsTan Chin Sien

Lim Swee Kwang

Soin SinghLee Ghai Keen

Sandy OhGoh Hin Tiang

Alvina TanKris Altice

Lim Gee KwangSean MarskeWa Kim Long

Shinya NishinaLew Kim Soon

Tay Chin YinAw Tiong Pheng

T. SukumaranDavid Chan

Danny NgAloysius Goh

Colin ChooDanny Choi

Long Shyh LaiChia Swee TongLim Hock Seng

KEY MANAGEMENT


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Singapore

Venture Corporation Limited 5006 Ang Mo Kio Avenue 5#05-01/12 TECHplace II Singapore 569873 Tel: +65 6482 1755 Fax: +65 6482 0122 Website:http://www.venture.com.sg

Multitech Systems Pte Ltd25 Kallang Avenue #03-05 Singapore 339416 Tel: +65 6294 9836 Fax: +65 6298 3904

Venture ElectronicsSolutions Pte Ltd5006 Ang Mo Kio Avenue 5 #05-01/12 TECHplace II Singapore 569873 Tel: +65 6482 1755Fax: +65 6482 0122

Univac PrecisionEngineering Pte LtdBlk 4012 Ang Mo Kio Ave 10#01-01 TECHplace ISingapore 569628Tel: +65 6457 3034Fax: +65 6459 2393

Ventech Data Systems Pte Ltd 5006 Ang Mo Kio Avenue 5 #05-01/12 TECHplace II Singapore 569873Tel: +65 6482 1755Fax: +65 6482 0122

Cebelian Holdings Pte Ltd5006 Ang Mo Kio Avenue 5 #05-01/12 TECHplace II Singapore 569873 Tel: +65 6482 1755Fax: +65 6482 0122

Innovative TrekTechnology Pte Ltd5006 Ang Mo Kio Avenue 5 #05-01/12 TECHplace II Singapore 569873 Tel: +65 6482 1755Fax: +65 6482 0122

VIPColor Technologies Pte Ltd5006 Ang Mo Kio Avenue 5 #05-01/12 TECHplace II Singapore 569873Tel: +65 6482 1755Fax: +65 6482 0122Website:http://www.vipcolor.com

VS Electronics Pte Ltd 5012 Ang Mo Kio Avenue 5 #03-01 TECHplace II Singapore 569873 Tel: +65 6481 8586 Fax: +65 6481 8717

VIPColor Technologies Pte Ltd5006 Ang Mo Kio Avenue 5 #05-01/12 TECHplace II Singapore 569873Tel: +65 6482 1755Fax: +65 6482 0122Website: http://www.vipcolor.com

Malaysia

Technocom Systems Sdn Bhd2 Jalan Kempas Lima/2 Tampoi, 81200 Johor Bahru, Malaysia Tel: +60 (07) 237 7201 Fax: +60 (07) 236 4146

Pintarmas Sdn Bhd 4 Jalan Kempas Lima/2 Tampoi, 81200 Johor Bahru, Malaysia Tel: +60 (07) 237 7201Fax: +60 (07) 234 5595

Venture Electronics Services(Malaysia) Sdn BhdPlot 44, Bayan Lepas IndustrialPark IV11900 Penang, MalaysiaTel: +60 (04) 642 8000Fax: +60 (04) 810 7086

Munivac Sdn BhdNo 7 Jalan Dewan 1/1Kawasan PerindustrianJalan Dewani81100 Johor BarhruMalaysiaTel: +60 (07) 339 1818Fax: +60 (07) 332 8899

Indonesia

PT Venture Electronics IndonesiaLot D22 Bintan Industrial EstateLobam Pulau Bintan 29152 Indonesia Tel: +011 (770) 696 998 Fax: +011 (770) 696 997

China

Venture Electronics(Shanghai) Co. Ltd1201 Gui Qiao RoadT52/11 Jin Qiao ExportProcessing ZonePudong New AreaShanghai 201206 China Phone No : +86 (21) 5899 8086Fax No : +86 (21) 5899 7682

North America

12.VM Services, Inc. 6701 Mowry Avenue Newark California 94560 United States of America Tel: +1 (510) 744 3720 Fax: +1 (510) 744 3730

VIPColor Technologies USA, Inc. 6701 Mowry Avenue Newark California 94560 United States of America Tel: +1 (510) 744 3770 Fax: +1 (510) 744 3738 Website:http://www.vipcolor.com

Venture ElectronicsInternational, Inc.6701 Mowry Avenue Newark California 94560 United States of America Tel: +1 (510) 744 3720 Fax: +1 (510) 744 3730

Venture ElectronicsMexico S.A. de C.V.Blvd. Federico Benitez 8250 Fracc. Chihuahua Tijuana, B.C. MexicoTel: +52 (6) 686 9399 Fax: +52 (6) 686 9280

Europe

Venture Electronics (Europe) B.V. First Alliance Trust N.V. Herengracht 469 Postbus/PO Box 741 1000 AS Amsterdam The NetherlandsTel: +31 (20) 522 6260 Fax: +31 (20) 522 6969

Venture Electronics Spain S.L.Avda. Graells 50108190 Sant Cugat del VallesBarcelona, SpainTel: +34 (93) 5822074Fax: +34 (93) 5822443

Venture Hungary Electronics Manufacturing Limited LiabilityCompany1134 Budapest, Vaci ut 35HungaryTel: +34 (620) 290284Fax: +34 (93) 5822443

GROUP OF COMPANIES



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FINANCIAL REPORT

CONTENTS

CORPORATE INFORMATION 26

REPORT OF THE DIRECTORS 27

AUDITORS’ REPORT 34

BALANCE SHEETS 35

PROFIT AND LOSS STATEMENTS 37

STATEMENTS OF CHANGES IN EQUITY 38

CONSOLIDATED CASH FLOW STATEMENT 40

NOTES TO FINANCIAL STATEMENTS 43

STATEMENT OF DIRECTORS 69

CORPORATE GOVERNANCE 70

SHAREHOLDERS’ INFORMATION 75

NOTICE OF ANNUAL GENERAL MEETING 76

NOTICE OF BOOK CLOSURE 78

PROXY FORM

Venture Financials sign P25-80 16/4/03 05:22 PM Page 25

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REPORT OF THE DIRECTORS

The directors present their report together with the audited financial statements of the company and of the group for thefinancial year ended December 31, 2002.

During the year, the company changed its name from Venture Manufacturing (Singapore) Ltd to Venture Corporation Limited.

1 DIRECTORS

The directors of the company in office at the date of this report are:

Gopala Achuta MenonWong Ngit LiongCecil Vivian Richard WongTan Choon HuatKoh Lee BoonSoo Eng Hiong (Alternate to Tan Choon Huat)

2 AUDIT COMMITTEE

The Audit Committee comprises three members, all of whom are non-executive directors. The members of theCommittee are:

Cecil Vivian Richard Wong (Chairman)Gopala Achuta MenonKoh Lee Boon

The Audit Committee is chaired by Cecil Vivian Richard Wong, an independent non-executive director and includes GopalaAchuta Menon, a non-executive director and Koh Lee Boon, an independent non-executive director.

The Audit Committee held three meetings since the last directors’ report and performed the following functions:

(a) reviewed the audit plan of the company’s external auditors, the results of their examination and evaluation of thegroup’s system of internal accounting controls and the assistance given by the management to the external auditors;

(b) reviewed the financial statements of the company and the consolidated financial statements of the group before theirsubmission to the Board of Directors and the Auditors’ report there on;

(c) reviewed interested person transactions between the group and the interested persons;

(d) reviewed the half yearly and annual announcements as well as the related press releases on the results and financialposition of the company and the group; and

(e) recommend the re-appointment of the external auditors of the company.

The Audit Committee has full access to and co-operation of the management. The auditors have unrestricted access tothe Audit Committee.

3 PRINCIPAL ACTIVITIES

The principal activities of the company are to provide manufacturing, design, engineering, customisation and logisticservices to electronics companies worldwide.

The principal activities of the subsidiaries, associates and joint venture are detailed in Notes 9, 10 and 11 to the financialstatements.

There have been no significant changes in the nature of these activities during the financial year.


CORPORATE INFORMATION

Registered Office

10 Collyer Quay #19-08Ocean BuildingSingapore 049315Tel: (65) 6536 5355Fax: (65) 6536 1360

Company Secretary

Yvonne Choo / Tan Lay Hong10 Collyer Quay #19-08Ocean BuildingSingapore 049315Tel: (65) 6536 5355Fax: (65) 6536 1360

Registrar and Share Transfer Office

M & C Services Private Limited138 Robinson Road, #17-00The Corporate OfficeSingapore 068906Tel: (65) 6227 6660Fax: (65) 6225 1452

Auditors

Deloitte & ToucheCertified Public Accountants6 Shenton Way, #32-00DBS Building Tower TwoSingapore 068809Tel: (65) 6224 8288Fax: (65) 6538 6166

Partner-in-charge: Philip Yuen Ewe JinDate of appointment: January 1, 2002

Principal Banks

Citibank N.A.ABN-AMRO BankJPMorgan Chase Bank


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4 ACQUISITION AND DISPOSAL OF SUBSIDIARIES (cont’d)Effective

Country of Equity Cost

Incorporation Interest Held of Investment

Name of Company and Operation Principal Activities by Group by the Group

% $’000

(v) Venture Electronics United Manufacture, design, engineering, 100 183International, Inc. States of customisation and logistic services(wholly-owned Americasubsidiary of VM Services, Inc.)

(c) During the financial year, Venture International Marketing Ltd, a wholly-owned subsidiary of the company, whoseissued and fully paid-up share capital was £100, was liquidated.

Except as disclosed above, there were no other acquisitions or disposals of subsidiaries during the financial year.

5 RESULTS FOR THE FINANCIAL YEARThe Company The Group

$’000 $’000

Profit after income tax but before minority interests 78,256 184,073Minority interests – (2,974)

Net profit attributable to the shareholders of the company 78,256 181,099Accumulated profits at beginning of year 304,677 480,493

Accumulated profits available for appropriation 382,933 661,592First and final tax exempt dividend and tax exempt bonus

dividend paid in respect of the previous financial year (11,637) (11,637)

Accumulated profits at end of year 371,296 649,955

6 MATERIAL TRANSFERS TO/FROM RESERVES AND PROVISIONS

There were no material transfers to or from reserves and provisions other than those disclosed in the attached financialstatements.

7 ISSUE OF SHARES AND DEBENTURES

During the financial year, the company made the following share issues:

i) 31,000 new ordinary shares of $0.25 each at a price of $3.64 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

ii) 10,000 new ordinary shares of $0.25 each at a price of $5.73 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

iii) 109,000 new ordinary shares of $0.25 each at a price of $5.40 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

iv) 30,000 new ordinary shares of $0.25 each at a price of $4.98 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.



4 ACQUISITION AND DISPOSAL OF SUBSIDIARIES

(a) During the financial year, the company acquired the following subsidiaries:

Effective

Country of Equity Net Tangible Cost

Incorporation Interest Held Assets of Investment

Name of Company and Operation Principal Activities by Group Acquired by the Group

% $’000 $’000

(i) Univac Precision Singapore Manufacture, design, fabricate, 67 37,399 88,440Engineering Pte Ltd stamping and injection, metal(Note 1) punching and spraying,

industrial metal parts, toolsand dies

(ii) Venture Electronics Malaysia Manufacture and sale of 100 17,777 17,777Services (Malaysia) removable disk drives andSdn Bhd (formerly cartridge storage mediaknown as Iomega(Malaysia) Sdn Bhd)

Note 1 – The subsidiaries and associates are detailed in Notes 9 and 10 to the financial statements.

(b) During the financial year, the following subsidiaries were incorporated:Effective

Country of Equity Cost

Incorporation Interest Held of Investment

Name of Company and Operation Principal Activities by Group by the Group

% $’000

(i) Venture Electronics Singapore Manufacture, design, engineering, 80 800Solutions Pte Ltd customisation and logistic services

(ii) Venture Electronics The Investment holding 100 29(Europe), B.V. Netherlands(wholly-ownedsubsidiary of CebelianHoldings Pte Ltd)

(iii) Venture Electronics Spain Manufacture, design, engineering, 100 5Spain S.L. (wholly- customisation and logistic servicesowned subsidiary ofVenture Electronics(Europe), B.V.)

(iv) Venture Hungary Hungary Design, manufacture, assemble 100 23Electronics and distribute electronicManufacturing Limited productsLiability Company(95% owned by Venture Electronics(Europe), B.V. and 5% owned by CebelianHoldings Pte Ltd)


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10 DIVIDENDS

The directors of the company propose a first and final tax exempt dividend of 15% and a tax exempt bonus dividend of15% on the ordinary shares of the company, amounting to $18,023,571 in respect of the company’s financial year endedDecember 31, 2002.

The first and final tax exempt dividend of 10% and tax exempt bonus dividend of 10% on the ordinary shares of thecompany, amounting to $11,636,832 proposed in the directors’ report for the year ended December 31, 2001 was paidduring the year.

11 DIRECTORS’ ACTIONS RELATING TO BAD AND DOUBTFUL DEBTS

Before the profit and loss statement and the balance sheet were made out, the directors of the company took reasonablesteps to ascertain that proper action had been taken in relation to the writing off and providing for bad and doubtful debtsof the company and have satisfied themselves that all known bad debts, if any, of the company have been written offand that where necessary adequate provision has been made for doubtful debts.

At the date of this report, the directors of the company are not aware of any circumstances which would render anyamounts written off or provided for bad and doubtful debts for the group of companies in the consolidated financialstatements of the company inadequate to any substantial extent.

12 DIRECTORS’ ACTIONS RELATING TO CURRENT ASSETS

Before the profit and loss statement and the balance sheet were made out, the directors of the company took reasonablesteps to ascertain that any current assets of the company which were unlikely to realise their book values, in the ordinarycourse of business, have been written down to their estimated realisable values or were adequately provided for.

At the date of this report, the directors of the company are not aware of any circumstances which would render thevalues attributable to current assets in the consolidated financial statements misleading.

13 CHARGES ON ASSETS AND EXISTENCE OF CONTINGENT LIABILITIES AFTER YEAR END DATE

At the date of this report:

a) there does not exist any charge on the assets of the company or any corporation in the group which has arisen sincethe end of the financial year which secures the liability of any other person; and

b) there does not exist any contingent liability of the company or any corporation in the group which has arisen sincethe end of the financial year.

14 ABILITY TO MEET OBLIGATIONS

No contingent or other liability of the company or any corporation in the group has become enforceable or is likely tobecome enforceable within the period of twelve months after the end of the financial year which, in the opinion of thedirectors of the company, will or may substantially affect the ability of the company and of the group to meet itsobligations as and when they fall due.

15 OTHER CIRCUMSTANCES AFFECTING FINANCIAL STATEMENTS

At the date of this report, the directors of the company are not aware of any circumstances not otherwise dealt with inthis report or consolidated financial statements which would render any amount stated in the financial statements of thecompany and the consolidated financial statements misleading.

16 UNUSUAL ITEMS

In the opinion of the directors of the company, the results of the operations of the company and of the group have notbeen substantially affected by any item, transaction or event of a material and unusual nature during the financial year.



7 ISSUE OF SHARES AND DEBENTURES (cont’d)

v) 693,000 new ordinary shares of $0.25 each at a price of $14.40 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

vi) 506,000 new ordinary shares of $0.25 each at a price of $14.60 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

vii) 822,000 new ordinary shares of $0.25 each at a price of $12.27 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

viii) 3,521,000 new ordinary shares of $0.25 each at a price of $8.05 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

ix) 3,489,663 new ordinary shares of $0.25 each at a price of $16.7466 per share to the shareholders of UnivacPrecision Engineering Pte Ltd (“Univac”) as part of the consideration paid pursuant to the Sale and PurchaseAgreement for the company’s acquisition of 67% of the total issued share capital of Univac.

The newly issued shares rank pari passu in all respects with the respective existing shares of the company.

The subsidiaries did not issue any shares except for Venture Electronics (Shanghai) Co Ltd, which increased its paid-incapital from $3,000,000 to $3,443,032. The company or subsidiaries in the group did not issue any debentures.

8 ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE BENEFITS BY MEANS OF THE ACQUISITION OF

SHARES AND DEBENTURES

Neither at the end of the financial year nor at any time during the financial year did there subsist any arrangement whoseobject is to enable the directors of the company to acquire benefits by means of the acquisition of shares or debenturesin the company or any other body corporate except for the share option rights mentioned in paragraph 9 of this report.

9 DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES

The directors of the company holding office at the end of the financial year had no interests in the share capital of thecompany and related corporations as recorded in the register of directors’ shareholdings kept by the company underSection 164 of the Singapore Companies Act except as follows:

Shareholdings registered in the name of directors

At At

January 1, 2002 December 31, 2002

Name of directors and company in which interests are held Shares of $0.25 each

The Company

Wong Ngit Liong 15,802,141 15,802,141Tan Choon Huat 4,228,145 4,228,145Soo Eng Hiong 3,671,362 3,671,362Koh Lee Boon 3,000 3,000

Share options to subscribe for shares of $0.25 each

The Company

Wong Ngit Liong 4,875,000 5,000,000Tan Choon Huat 2,190,000 2,280,000Soo Eng Hiong 1,940,000 2,030,000

The directors’ interests in the share capital of the company and its subsidiaries as at January 21, 2003 are the same asat December 31, 2002.


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21 UNISSUED SHARES UNDER OPTION

At the end of the financial year, unissued ordinary shares of the company under option were as follows:

In conjunction with the Venture Corporation Limited Executives’ Share Option Scheme.

Number of options tosubscribe for ordinary shares : (i) 54,000 ordinary shares of $0.25 each

(ii) 3,000 ordinary shares of $0.25 each(iii) 2,430,000 ordinary shares of $0.25 each(iv) 3,402,000 ordinary shares of $0.25 each(v) 3,234,000 ordinary shares of $0.25 each(vi) 18,728,000 ordinary shares of $0.25 each(vii) 5,252,000 ordinary shares of $0.25 each

Price of issue per share : (i) $5.40 payable in full on notification by cash(ii) $4.98 payable in full on notification by cash(iii) $14.40 payable in full on notification by cash(iv) $14.60 payable in full on notification by cash(v) $12.27 payable in full on notification by cash(vi) $8.05 payable in full on notification by cash(vii) $13.77 payable in full on notification by cash

Option exercisable period : (i) April 30, 1999 to April 29, 2003(ii) October 30, 1999 to October 29, 2003(iii) November 9, 2000 to November 8, 2004(iv) November 12, 2001 to November 11, 2005(v) April 30, 2002 to April 29, 2006(vi) September 25, 2002 to September 24, 2006(vii) July 1, 2003 to June 30, 2007

Options to take up 328,300 ordinary shares of $0.25 each lapsed during the year.

Pursuant to the Sale and Purchase Agreement for the acquisition of a 67% equity interest in a subsidiary, UnivacPrecision Engineering Pte Ltd (“Univac”) during the year, the vendors of those shares were granted a put option toacquire the remaining 33% equity interest in Univac held by them. The consideration to the vendors for the 33% equityinterest in Univac would be satisfied by the issuance of new ordinary shares in the company in accordance with aprescribed formula.

There were no other unissued shares under option at the end of the financial year except as disclosed above.

22 AUDITORS

The auditors, Deloitte & Touche, have expressed their willingness to accept re-appointment.

ON BEHALF OF THE BOARD

Wong Ngit Liong


March 7, 2003



17 UNUSUAL ITEMS AFTER YEAR END DATE

In the opinion of the directors of the company, no item, transaction or event of a material and unusual nature has arisenin the interval between the end of the financial year and the date of this report which would affect substantially the resultsof the operations of the company and of the group for the financial year in which this report is made.

18 DIRECTORS’ RECEIPT AND ENTITLEMENT TO CONTRACTUAL BENEFITS

Since the beginning of the financial year, no director has received or become entitled to receive a benefit which isrequired to be disclosed under Section 201(8) of the Singapore Companies Act, by reason of a contract made by thecompany or a related corporation with the director or with a firm of which he is a member, or with a company in whichhe has a substantial financial interest except that certain directors received remuneration in their capacity as directorsand/or executives of those related corporations and except as disclosed in the financial statements.

19 OPTIONS TO TAKE UP UNISSUED SHARES

Under the Venture Corporation Limited Executives’ Share Option Scheme (the “Scheme”), options to take up 5,252,000shares of $0.25 each were granted to 3 directors and 587 employees of the group during the financial year at an exerciseprice of $13.77 each in accordance with the terms of the Scheme. The options are exercisable during the periodcommencing twelve months from the date of grant and expiring at the end of five years from the date of grant.

No other options to take up unissued shares of the company or its subsidiaries were granted during the financial yearexcept as disclosed above.

20 OPTIONS EXERCISED

a) Except for the options exercised as mentioned in paragraph 7 of this report, no other shares of the company or itssubsidiaries were issued during the financial year by virtue of the exercise of options to take up unissued shares ofthe company or its subsidiaries.

b) The following are details of options granted to and exercised by the directors of the company under the VentureCorporation Limited Executives’ Share Option Scheme:

Aggregate options Aggregate options

granted since exercised since Aggregate

commencement commencement options

Options of scheme of scheme outstanding

granted during to end of to end of as at end of

financial year financial year financial year financial year

Name of participant under review under review under review under review

Wong Ngit Liong 125,000 5,000,000 – 5,000,000Tan Choon Huat 90,000 3,658,989 1,378,989 2,280,000Soo Eng Hiong 90,000 3,408,989 1,378,989 2,030,000

The Venture Corporation Limited Executives’ Share Option Scheme, which has been approved by the shareholdersof the company, is administered by the Share Option Committee whose members are:

Cecil Vivian Richard WongGopala Achuta MenonKoh Lee BoonWong Ngit Liong


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BALANCE SHEETSDecember 31, 2002

The Company The Group

Notes 2002 2001 2002 2001

$’000 $’000 $’000 $’000

ASSETS

Current assets:

Cash 53,394 37,335 153,729 77,009Fixed deposits 5 211,943 201,251 266,004 237,107Trade receivables 6 193,527 174,841 446,334 240,748Other receivables and

prepayments 7 15,037 5,866 31,205 18,176Inventories 8 65,260 85,596 217,803 151,274Amount due from subsidiaries

(trade) 9 88,969 51,698 – –Amount due from subsidiaries

(non-trade) 9 66,866 53,290 – –Amount due from associates

(trade) 10 – – 2,730 –Amount due from joint

venture (trade) 11 – 2,776 74 1,409

Total current assets 694,996 612,653 1,117,879 725,723

Non-current assets:

Investments in subsidiaries 9 122,345 15,328 – –Investments in associates 10 – – 24,194 –Investment in joint venture 11 1,000 1,000 – –Other investments 12 914 – 46,034 20,848Property, plant and equipment 13 29,345 32,637 162,430 114,260Intangible assets 14 – – 25,101 23,218Goodwill on consolidation 15 – – 51,466 1,936

Total non-current assets 153,604 48,965 309,225 160,262

Total assets 848,600 661,618 1,427,104 885,985


AUDITORS’ REPORTto the members of Venture Corporation Limited

We have audited the financial statements of Venture Corporation Limited and the consolidated financial statements of thegroup for the financial year ended December 31, 2002 as set out on pages 35 to 68. These financial statements are theresponsibility of the company’s directors. Our responsibility is to express an opinion on these financial statements based onour audit.

We conducted our audit in accordance with Singapore Standards on Auditing. Those Standards require that we plan andperform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.An audit also includes assessing the accounting principles used and significant estimates made by the directors, as well asevaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion:

a) the accompanying financial statements and consolidated financial statements of the group are properly drawn up inaccordance with the provisions of the Singapore Companies Act (“Act”) and Singapore Statements of AccountingStandard and so as to give a true and fair view of:

i) the state of affairs of the company and of the group as at December 31, 2002 and of the results, changes in equityof the company and of the group, and cash flows of the group for the financial year then ended; and

ii) the other matters required by Section 201 of the Act to be dealt with in the financial statements of the company andthe consolidated financial statements of the group;

b) the accounting and other records and the registers required by the Act to be kept by the company and by thosesubsidiaries incorporated in Singapore of which we are the auditors have been properly kept in accordance with theprovisions of the Act.

We have considered the financial statements and auditors’ reports of all the subsidiaries of which we have not acted asauditors and the financial statements of subsidiaries of which an audit is not required, being financial statements included inthe consolidated financial statements. The names of these subsidiaries are indicated in Note 9 to the financial statements.

We are satisfied that the financial statements of the subsidiaries that are consolidated with the financial statements of thecompany are in a form and content appropriate and proper for the purposes of the preparation of the consolidated financialstatements and we have received satisfactory information and explanations as required by us for those purposes.

The auditors’ reports on the financial statements of the subsidiaries were not subject to any qualification and in respect ofthe subsidiaries incorporated in Singapore did not include any comment made under Section 207(3) of the Act.

Deloitte & ToucheCertified Public Accountants

Philip Yuen Ewe JinPartner

SingaporeMarch 7, 2003


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PROFIT AND LOSS STATEMENTSYear ended December 31, 2002


Notes 2002 2001 2002 2001

$’000 $’000 $’000 $’000

Revenue 20 1,385,441 963,138 2,366,252 1,430,862

Other operating income 21 8,558 7,918 6,063 7,090Changes in inventories of

finished goods and work in progress (2,399) 13,653 55,430 5,476

Raw materials and consumablesused (1,187,252) (785,606) (1,935,688) (1,099,594)

Staff costs 22 (67,117) (67,111) (154,383) (115,179)Depreciation and amortisation

expense (8,051) (7,626) (42,650) (27,791)Research and development

expense (19,857) (16,566) (29,675) (19,706)Foreign currency exchange

adjustment (loss) gain (10,544) 4,295 (12,730) 8,145Other operating expenses (27,201) (20,272) (72,099) (56,746)

Profit from operations 71,578 91,823 180,520 132,557

Interest income (net of interest expense) 23 8,724 9,010 12,117 11,178

Income from associates – – 1,552 –

Profit before income tax 24 80,302 100,833 194,189 143,735

Income tax expense 26 (2,046) (3,273) (10,116) (9,186)

Profit after income tax but

before minority interests 78,256 97,560 184,073 134,549

Minority interests – (2,974) 132

Net profit attributable to the

shareholders of the company 78,256 97,560 181,099 134,681

Basic earnings per share (cents) 27 77.1 58.3

Fully diluted earnings per share (cents) 27 73.8 57.7

See accompanying notes to financial statements.


BALANCE SHEETSDecember 31, 2002


Notes 2002 2001 2002 2001

$’000 $’000 $’000 $’000

LIABILITIES AND EQUITY

Current liabilities:

Bank overdrafts (unsecured) – – – 9,667Short-term bank loans 16 – – 6,054 5,179Trade payables 76,900 60,383 372,841 144,902Other payables 17 36,948 36,819 65,748 49,875Amount due to subsidiaries

(trade) 9 61,915 74,768 – –Amount due to associates (trade) 10 1,162 – 5,708 –Amount due to joint venture

(trade) 11 274 – 142 –Income tax payable 637 648 7,732 6,344

Total current liabilities 177,836 172,618 458,225 215,967

Non-current liability:

Deferred income tax 18 – – 3,458 4,188

Minority interests – – 22,451 441

Capital and reserves:

Issued capital 19 60,079 57,776 60,079 57,776Share premium 239,389 126,547 239,389 126,547Accumulated profits 371,296 304,677 649,955 480,493Reserve on consolidation – – 51 51Currency translation reserves – – (6,504) 522

Total equity 670,764 489,000 942,970 665,389

Total liabilities and equity 848,600 661,618 1,427,104 885,985



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Currency Reserve

Issued Share translation on Accumulated

capital premium reserves consolidation profits Total

$’000 $’000 $’000 $’000 $’000 $’000

Group

Balance at December 31, 2000 57,703 125,260 (5,526) 51 357,362 534,850

Currency translation differences – – 6,048 – – 6,048

Net profit attributable to the shareholders of the company – – – – 134,681 134,681

First and final tax exempt dividend and tax exempt bonus dividend paid inrespect of the previous financial year – – – – (11,550) (11,550)

Issue of shares 73 1,287 – – – 1,360

Balance at December 31, 2001 57,776 126,547 522 51 480,493 665,389

Currency translation differences – – (7,026) – – (7,026)

Net profit attributable to theshareholders of the company – – – – 181,099 181,099

First and final tax exempt dividend and tax exempt bonus dividend paid inrespect of the previous financial year – – – – (11,637) (11,637)

Issue of shares 2,303 112,842 – – – 115,145

Balance at December 31, 2002 60,079 239,389 (6,504) 51 649,955 942,970

During the year, the company declared and paid final and bonus tax exempt dividends of $0.05 per ordinary share on theordinary shares of the company totalling $11,636,832 in respect of the financial year ended December 31, 2001.



STATEMENTS OF CHANGES IN EQUITYYear ended December 31, 2002

Issued Share Accumulated

capital premium profits Total

$’000 $’000 $’000 $’000

Company

Balance at December 31, 2000 57,703 125,260 218,667 401,630

Net profit attributable to the shareholders of the company – – 97,560 97,560

First and final tax exempt dividend and tax exempt bonus dividend paid in respectof the previous financial year – – (11,550) (11,550)

Issue of shares 73 1,287 – 1,360


Net profit attributable to the shareholders of the company – – 78,256 78,256

First and final tax exempt dividend and tax exempt bonus dividend paid in respectof the previous financial year – – (11,637) (11,637)

Issue of shares 2,303 112,842 – 115,145



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The Group

2002 2001

$’000 $’000

Cash flows from investing activities:

Contribution from (payment to) minority shareholders 187 (179)Purchase of property, plant and equipment (49,515) (39,315)Proceeds on disposal of plant and equipment 3,514 6,246Intangible assets (8,777) (11,521)Proceeds on disposal of investment in associates – 500Purchase of other investments (33,259) (276)Dividends received from associates 449 – Acquisition of subsidiaries, net of cash acquired (Note A) (14,041) –

Net cash used in investing activities (101,442) (44,545)

Cash flows from financing activities:

Increase in short-term bank loans 875 4,832Proceeds from issue of shares 56,705 1,360

Net cash from financing activities 57,580 6,192

Net effect of exchange rate changes in consolidating subsidiaries (4,571) 3,825

Net increase in cash and cash equivalents 115,284 105,509Cash and cash equivalents at beginning of year 304,449 198,940

Cash and cash equivalents at end of year 419,733 304,449

Cash and cash equivalents at end of year include the following:

Cash 153,729 77,009Fixed deposits 266,004 237,107Bank overdrafts – (9,667)

419,733 304,449


CONSOLIDATED CASH FLOW STATEMENTYear ended December 31, 2002

The Group

2002 2001

$’000 $’000

Cash flows from operating activities:

Profit before income from associates, income tax and minority interests 192,637 143,735

Adjustments for:Depreciation expense 34,256 26,402Amortisation of goodwill 1,511 69Goodwill written off – 12Amortisation of intangible assets 6,883 1,308Impairment loss on other investments 8,808 900Interest income (12,560) (11,507)Dividend income (738) (712)Interest expense 443 329Gain on disposal of investment in associates – (28)Loss on disposal of plant and equipment, net 41 61

Operating profit before working capital changes 231,281 160,569

Trade receivables (188,908) (62,426)Other receivables and prepayments (7,484) (6,928)Amount due from joint venture (trade) 1,477 (1,283)Inventories (55,472) 76,145Trade payables 189,625 (9,990)Other payables 8,929 (8,525)Amount due from associates (trade) 2,978 –

Cash generated from operations 182,426 147,562

Interest paid (443) (329)Interest received 12,560 11,507Income tax paid (19,927) (7,865)Dividends received 738 712Dividends paid (11,637) (11,550)

Net cash from operating activities 163,717 140,037


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NOTES TO FINANCIAL STATEMENTSDecember 31, 2002

1 GENERAL

The company is incorporated in the Republic of Singapore with its principal place of business at 5006 Ang Mo Kio Avenue5, #05-01/12 Techplace II, Singapore 569873 and registered office at 10 Collyer Quay, #19-08 Ocean Building, Singapore049315. The financial statements are expressed in Singapore dollars.

During the year, the company changed its name from Venture Manufacturing (Singapore) Ltd to Venture CorporationLimited.

The principal activities of the company are to provide manufacturing, design, engineering, customisation and logisticservices to electronics companies worldwide. The principal activities of the subsidiaries, associates and joint venturecompany are detailed in Notes 9, 10 and 11 to the financial statements.

The financial statements of the company and of the group for the year ended December 31, 2002 were authorised forissue by the Board of Directors on March 7, 2003.

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a) BASIS OF ACCOUNTING – The financial statements are prepared in accordance with the historical cost conventionand are drawn up in accordance with the provisions of the Singapore Companies Act and Singapore Statements ofAccounting Standard (“SAS”).

The company and group have adopted all the applicable new/revised SAS which became effective during the year.The adoption of the new/revised SAS does not affect the results of the current period and prior period.

b) BASIS OF CONSOLIDATION – The consolidated financial statements incorporate the financial statements of thecompany and enterprises controlled by the company (its subsidiaries) made up to December 31 each year. Control isachieved where the company has the power to govern the financial and operating policies of an investee enterpriseso as to obtain benefits from its activities. On acquisition, the assets and liabilities of the relevant subsidiaries aremeasured at their fair values at the date of acquisition. The interest of minority shareholders is stated at the minority'sproportion of the fair values of the assets and liabilities recognised. The results of subsidiaries acquired or disposedof during the year are included in the consolidated profit and loss statement from the effective date of acquisition orup to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financialstatements of subsidiaries to bring the accounting policies used in line with those used by other members of thegroup. All significant intercompany transactions and balances between group enterprises are eliminated onconsolidation.

In the company’s financial statements, investments in subsidiaries and associates are carried at cost less anyimpairment in net recoverable value that has been recognised in the profit and loss statement.

c) ASSOCIATES – An associate is an enterprise over which the group exercises significant influence throughparticipation in the financial and operating policy decisions of the investee. The results and assets and liabilities ofassociates are incorporated in these financial statements using the equity method of accounting. The carrying amountof such investments is reduced to recognise any decline in the net recoverable value of individual investments.Where a group enterprise transacts with an associate of the group, unrealised profits and losses are eliminated tothe extent of the group’s interest in the relevant associate.

d) JOINT VENTURE – A joint venture is a contractual arrangement whereby the group and other parties undertake aneconomic activity which is subject to joint control. Where a group company undertakes its activities under jointventure arrangements directly, the group’s share of jointly controlled assets and any liabilities incurred jointly withother venturers are recognised in the financial statements of the relevant company and classified according to theirnature. Liabilities and expenses incurred directly in respect of interests in jointly controlled assets are accounted foron an accrual basis. Income from the sale or use of the group’s share of the output of jointly controlled assets, andits share of joint venture expenses, are recognised when it is probable that the economic benefits associated withthe transactions will flow to/from the group and their amount can be measured reliably.

Joint venture arrangements which involve the establishment of a separate entity in which each venturer has aninterest are referred to as jointly controlled entities. The group reports its interests in jointly controlled entities usingproportionate consolidation where the group’s share of the assets, liabilities, income and expenses of jointlycontrolled entities are combined with the equivalent items in the consolidated financial statements on a line-by-linebasis. Where the group transacts with its jointly controlled entities, unrealised profits and losses are eliminated to theextent of the group’s interest in the joint venture, except where unrealised losses provide evidence of an impairmentof the asset transferred.


CONSOLIDATED CASH FLOW STATEMENTYear ended December 31, 2002

Note A:2002

$’000

Summary of the effects of acquisition of subsidiaries:

Net assets acquired:Current assets 61,674Non-current assets 63,170Current liabilities (49,587)Non-current liabilities (1,232)Minority interests (18,849)

Net assets acquired 55,176Goodwill arising on acquisition of subsidiaries 51,041

Purchase consideration 106,217

Purchase consideration satisfied by:Shares issued 58,440Cash paid 47,777

Purchase consideration 106,217

Net cash flow on acquisition:Cash paid (47,777)Cash acquired 33,736

Cash outflow on acquisition, net of cash acquired (14,041)



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2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)

j) SOFTWARE DEVELOPMENT COSTS – Costs that are directly associated with the development of identifiable andunique software products controlled by the company and have probable economic benefit exceeding the costsbeyond one year, are recognised as intangible assets. Direct costs include the staff costs of the softwaredevelopment team and an appropriate portion of relevant overheads. Costs which enhance or extend performance ofthe computer software programs beyond their original specifications are capitalised and added to the original cost ofsoftware. Other software development costs are expensed when incurred. Computer software development coststhat are capitalised are amortised using the straight-line method over their useful lives, not exceeding a period of 3years. Where an indication of impairment exists, the carrying amount of any intangible asset is assessed and writtendown immediately to its recoverable amount.

k) INVENTORIES – Inventories are measured at the lower of cost (weighted average method) and net realisable value.Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to theirpresent location and condition. Net realisable value represents the estimated selling price less all estimated costs tocompletion and costs to be incurred in marketing, selling and distribution.

l) FINANCIAL ASSETS – Financial assets include cash and fixed deposits, trade and other receivables and otherinvestments. Included in fixed deposits are equity linked deposits which are measured at their nominal value reducedby allowances for impairment loss. Trade and other receivables are stated at their nominal value as reduced byappropriate allowances for estimated irrecoverable amounts. Other investments are stated in accordance with theaccounting policy enumerated above.

m) FINANCIAL LIABILITIES AND EQUITY – Financial liabilities and equity instruments are classified according to thesubstance of the contractual arrangements entered into. Financial liabilities include trade and other payables, incometax payable and bank loans. Trade, other payables and income tax payable are stated at their nominal value. Bankloans are recorded at the proceeds received, net of transaction costs. Finance costs are accounted for on an accrualbasis (effective yield method) and are added to the carrying amount of the instrument to the extent that they are notsettled in the period in which they arise. Equity instruments are recorded at the fair value of the considerationreceived, net of direct issue costs. Share options are recorded when exercised and the exercise price is allocatedbetween issued capital and share premium accordingly.

n) IMPAIRMENT OF ASSETS – At each balance sheet date, the group reviews the carrying amounts of its non-currentassets to determine whether there is any indication that those assets have suffered an impairment loss. If any suchindication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairmentloss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the group estimatesthe recoverable amount of the cash-generating unit to which the asset belongs. If the recoverable amount of an asset(or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. Impairment losses are recognised as an expense immediately.

Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) isincreased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amountdoes not exceed the carrying amount that would have been determined had no impairment loss been recognised forthe asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised as incomeimmediately.

o) REVENUE RECOGNITION – Revenue from sale of goods is recognised when significant risks and rewards ofownership are transferred to the buyer and the amount of revenue and the costs of transaction (including futurecosts) can be measured reliably. Revenue from the rendering of services that are of a short term duration isrecognised when the services are completed. Revenue for the group includes dividend income from investmentswhich is recognised when the shareholders’ rights to receive payment have been established.




e) GOODWILL – Goodwill represents the excess of the cost of an acquisition over the fair value of the group’s share ofthe net identifiable assets of the acquired subsidiary, associate or joint venture at the date of acquisition and isamortised in equal amounts over 20 years. Any impairment in value which is other than a temporary decline are takento the profit and loss statement.

f) FOREIGN CURRENCY TRANSACTIONS AND TRANSLATION – Transactions in foreign currencies are recorded at therates ruling on the dates of the transactions. At each balance sheet date, recorded monetary balances and balancescarried at fair value that are denominated in foreign currencies are reported at the rates ruling at the balance sheetdate. All realised and unrealised exchange adjustment profits and losses are dealt with in the profit and lossstatement, except that exchange differences arising on monetary balances that, in substance, form part of thegroup’s net investment in foreign entities, are taken to the currency translation reserve.

For inclusion in the consolidated financial statements, assets and liabilities of the foreign entities (subsidiaries,associates and joint ventures) are translated at the rates of exchange approximating those ruling at the balance sheetdate. The profit and loss statements are translated at the average rates of exchange for the year, and the opening netinvestment in the foreign entities is translated at the historical rates. The resulting currency translation differencesare taken to the currency translation reserve. On disposal of a foreign entity, the accumulated currency translationdifferences are recognised in the profit and loss statement as part of the profit or loss on disposal.

g) OTHER INVESTMENTS – Other investments held for long-term are stated at cost reduced to recognise a declineother than temporary in the value of investments. Investments held for short-term are stated at lower of cost ormarket value determined on a portfolio basis.

h) PROPERTY, PLANT AND EQUIPMENT – Property, plant and equipment are carried at cost less accumulateddepreciation and any impairment loss where the recoverable amount of the asset is estimated to be lower than itscarrying amount.

Depreciation is charged so as to write off the cost of assets, other than freehold land, over their estimated usefullives, using the straight-line method, on the following bases:

Leasehold land – 60 yearsFactory building – 50 yearsFreehold building – 30 yearsLeasehold building – 25 yearsMachinery and equipment – 5 to 10 yearsLeasehold improvements and renovations – 5 to 10 yearsOffice equipment, furniture and fittings – 3 to 10 yearsComputer hardware – 3 yearsMotor vehicles – 5 to 6 years

Fully depreciated assets still in use are retained in the financial statements.

i) RESEARCH AND DEVELOPMENT COSTS – Research expenditure is recognised as an expense as incurred. Costsincurred on development projects are recognised as intangible assets only if all the following conditions are met:

* an asset is created that can be identified (such as software and new processes);

* it is probable that the asset created will generate future economic benefits; and

* the development cost of the asset can be measured reliably.

Other development expenditures are recognised as expenses when incurred. Development costs previouslyrecognised as an expense are not recognised as an asset in a subsequent period. Development costs that have beencapitalised as intangible assets are amortised from the commencement of the commercial production on a straight-line basis over the period of its expected benefits, which normally does not exceed 3 years. Where an indication ofimpairment exists, the carrying amount of any intangible asset is assessed and written down immediately to itsrecoverable amount.


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4 RELATED COMPANY TRANSACTIONS

Some of the company's transactions and arrangements are between members of the group and the effect of these onthe basis determined between the parties are reflected in these financial statements. The intercompany balances areunsecured, interest-free and without fixed repayment terms.

Significant intercompany transactions, other than those disclosed elsewhere in the notes to profit and loss statement:

The Company

2002 2001

$’000 $’000

Revenue 86,780 37,560

Management fee income 1,172 852

Purchases of goods 613,941 284,760

Purchases of services 19,207 16,038

Other charge 3,370 1,135

Other income 2,275 –

5 FIXED DEPOSITSThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Fixed deposits 176,742 163,775 223,615 195,979Fixed rate bonds 32,363 25,456 39,551 29,108Equity linked deposits 5,338 16,320 5,338 16,320

214,443 205,551 268,504 241,407Impairment loss on equity linked deposits (2,500) (4,300) (2,500) (4,300)

211,943 201,251 266,004 237,107

Movement in impairment loss on equity linked deposits:Balance at beginning of year 4,300 – 4,300 – (Reversal) Charge during the year (Note 24) (1,800) 4,300 (1,800) 4,300

Balance at end of year 2,500 4,300 2,500 4,300

Fixed deposits of certain subsidiaries amounting to $2,731,226 (2001: $1,216,532) were pledged to banks to secure bankcredit facilities granted to the subsidiaries.




p) INCOME TAX – Tax expense is determined on the basis of tax effect accounting, using the liability method, and it isapplied to all significant temporary differences arising between the carrying amount of assets and liabilities in thefinancial statements and the corresponding tax bases used in the computation of taxable profit, except that a debitto the deferred tax balance is not carried forward unless there is a reasonable expectation of realisation and thepotential tax saving relating to a tax loss carryforward and unutilised capital allowances is not recorded as an assetunless there is a reasonable expectation of realisation in the foreseeable future.

Deferred tax is calculated at the tax rates that are expected to apply to the period when the assets are realised or theliability is settled. Deferred tax is charged or credited to the profit and loss statement. Deferred tax assets andliabilities are offset when they relate to income taxes levied by the same tax authority.

q) RETIREMENT BENEFIT COSTS – Payments to defined contribution retirement benefit plans (including state-managedretirement benefit schemes) are charged as an expense as they are incurred.

r) GOVERNMENT GRANTS – Government grants relating to deferred development expenditure and the purchase ofproperty, plant and equipment are included in the balance sheet by deducting the grant in arriving at the carryingamount of the assets. Government grants relating to expenditures which are not capitalised are credited to the profitand loss statement to match the related expenditure when incurred.

s) CASH – Cash for the cash flow statement includes cash and cash equivalents.

3 FINANCIAL RISKS AND MANAGEMENT

(i) Credit riskCredit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a loss to thegroup. This risk is managed through the application of credit approvals, credit limits and monitoring procedures. Thegroup has adopted a policy of only dealing with creditworthy counterparties and generally does not require collateralfrom customers. The group performs ongoing credit evaluation of their counterparties’ financial condition and regularmeetings are conducted to monitor debt collection and credit risk exposure on the group basis.

(ii) Interest rate riskInterest rate risk refers to the risk experienced by the company and the group as a result of the fluctuation in interestrates. The group has cash balances placed as various forms of deposits with reputable international financialinstitutions and investments in fixed rate bonds of strong financial ratings. These deposits and investments aregenerally with short-term maturities to provide the group the flexibility to meet working capital and other investmentsneeds. The group’s borrowings are also short-term in nature and kept at a minimal level.

(iii) Foreign currency riskForeign exchange exposures are naturally hedged as both the group’s trade sales and purchases are primarilydenominated in United States dollars. This reduces significantly the impact of movements in the foreign exchangerates.

(iv) Liquidity riskLiquidity risk refers to the risk in which the group has difficulties in meeting its short-term obligations. Liquidity riskis managed by matching the payment and receipt cycle. The group’s operations are financed mainly through equityand accumulated profits.

(v) Investment riskInvestment risk refers to the risk the group experienced in its management of the return on funds invested in financialinstruments. This risk includes market price risks due to fluctuations in interest rates, foreign currency exchangerates, prices of equities, debt securities and other financial contracts. Investment risk is managed through soundinvestment policies and guidelines. These policies and guidelines are constantly reviewed taking into considerationchanges in the overall market environment.

(vi) Fair value of financial assets and financial liabilitiesThe carrying amounts of financial assets and financial liabilities reported in the balance sheet approximate the fairvalues of those assets and liabilities, determined in accordance with the accounting policies disclosed in Note 2 tothe financial statements.


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9 INVESTMENTS IN SUBSIDIARIESThe Company

2002 2001

$’000 $’000

Unquoted equity shares, at cost 122,345 15,328

Country of Effective

Name of Incorporation Cost of Equity Interest

Subsidiaries and Operation Investment Held by Group Principal Activities

2002 2001 2002 2001

$’000 $’000 % %

Multitech Systems Singapore 3,215 3,215 100 100 Trading in and Pte Ltd manufacturing of

electronic and computer-related products

Ventech Data Singapore 5,000 5,000 100 100 Trading in andSystems Pte Ltd manufacturing of


Technocom Malaysia 1,543 1,543 100 100 Trading in andSystems Sdn Bhd (1) manufacturing of


Syarikat Perusahaan Malaysia – – 100 100 DormantSing Mee (Johore)Sdn Bhd (wholly-owned subsidiary ofTechnocom SystemsSdn Bhd) (1)

Pintarmas Sdn Bhd Malaysia – – 100 100 Trading in and(wholly-owned manufacturing ofsubsidiary of electronic and computer-Technocom Systems) (1) related products

Cebelian Holdings Singapore 2,500 2,500 100 100 Investment holdingPte Ltd

VM Services, Inc. United States – – 100 100 Trading in and(wholly-owned of America manufacturing ofsubsidiary of Cebelian electronic and computer-Holdings Pte Ltd) (3) related products

VIPColor Singapore – – 93.8 93.8 Develop and marketTechnologies Pte colour imaging products Ltd (a subsidiary of for label printingCebelian Holdings Pte Ltd)



6 TRADE RECEIVABLESThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Outside parties 193,527 174,841 446,350 240,748Less allowances for doubtful debts – – (16) –

193,527 174,841 446,334 240,748

Movements in allowances:Balance at beginning of year – – – – On acquisition of subsidiaries – – 16 –

Balance at end of year – – 16 –

7 OTHER RECEIVABLES AND PREPAYMENTSThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Other receivables 13,935 5,043 21,046 15,495Deposits 365 355 2,944 1,484Prepayments 737 468 1,859 1,197Tax recoverable – – 5,356 –

15,037 5,866 31,205 18,176

8 INVENTORIESThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

At cost:Raw materials 30,411 38,270 85,445 75,770Work in progress 28,748 25,211 70,677 37,186Finished goods 3,947 9,883 43,892 18,718

63,106 73,364 200,014 131,674Raw materials carried at net

realisable value after thefollowing allowances 2,154 12,232 17,789 19,600

65,260 85,596 217,803 151,274

Movements in allowances:Balance at beginning of year 2,212 3,582 3,274 4,973On acquisition of subsidiaries – – 1,819 – Charge (Reversal) to

profit and loss, net (Note 24) 125 (1,311) 176 (1,640)Amount written off against allowances – (59) (713) (59)

Balance at end of year 2,337 2,212 4,556 3,274


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9 INVESTMENTS IN SUBSIDIARIES (cont’d)




2002 2001 2002 2001

$’000 $’000 % %

Venture Electronics The Netherlands – – 100 – Investment holding(Europe), B.V.(wholly-ownedsubsidiary of CebelianHoldings Pte Ltd) (3)

Venture Electronics Spain – – 100 – Manufacture, design,Spain S.L. (wholly- engineering,owned subsidiary of customisation andVenture Electronics logistic services(Europe), B.V.) (3)

Venture Electronics Singapore 800 – 80 – Manufacture, design,Solutions Pte Ltd engineering,

customisation andlogistic services

Venture Hungary Hungary – – 100 – Design, manufacture,Electronics assemble and distributeManufacturing electronic productsLimited LiabilityCompany (95% ownedby Venture Electronics(Europe), B.V. and 5%owned by CebelianHoldings Pte Ltd) (3)

Univac Precision Singapore 88,440 – 67 – Manufacture, design, Engineering Pte Ltd fabricate, stamping and

injection, metal punching and spraying, industrial metal parts, tools and dies

Unison Precision Malaysia – – 67 – DormantIndustries (M) Sdn Bhd (wholly-ownedsubsidiary of UnivacPrecision Engineering Pte Ltd) (1)

Munivac Sdn Bhd Malaysia – – 59.9 – Manufacture of electronic (65.6% owned by and mechanicalUnison Precision componentsIndustries Sdn Bhdand 23.8% owned byUnivac PrecisionEngineering Pte Ltd) (1)







2002 2001 2002 2001

$’000 $’000 % %

VIPColor United States – – 93.8 93.8 Develop and marketTechnologies USA, Inc of America colour imaging products (wholly-owned for label printingsubsidiary of VIPColorTechnologies Pte Ltd) (3)

EAS Security Singapore – – 100 100 DormantSystems Pte Ltd(wholly-ownedsubsidiary of Cebelian Holdings Pte Ltd)

Venture Electronics People’s Republic – – 100 100 Trading in and(Shanghai) Co Ltd of China manufacturing of (wholly-owned electronic and computer-subsidiary of Cebelian related productsHoldings Pte Ltd) (1)

Innovative Trek Singapore 1,780 1,780 100 100 Information systemTechnology Pte Ltd development and support

PT Venture Electronics Indonesia 337 337 100 100 Trading in andIndonesia (99% owned manufacturing of by the company and 1% electronic and computer-owned by Multitech related productsSystems Pte Ltd) (1)

Advanced Products Singapore 863 863 100 100 Trading in electronic andCorporation Pte Ltd computer-related products

(During 2002, the companyceased operations)

Venture Electronics Mexico – – 100 100 Trading in andMexico S.A. de C.V. manufacturing of (98% owned by electronic and computer-Innovative Trek related productsTechnology Pte Ltdand 2% owned by Cebelian Holdings Pte Ltd) (1)

Ventech Investments British Virgin 90 90 100 100 Investment holdingLtd (3) Islands

Venture Electronics United States – – 100 – Manufacture, design,International, Inc. of America engineering, (wholly-owned customisation andsubsidiary of VM logistic servicesServices, Inc.) (3)


K


1 2 3 4 5 6 7 8 9 10 OK SL MOD: SL102

P8180SL160703 DL-Mac2 08.04.03 175#

LCL1

LCL1K


1 2 3 4 5 6 7 8 9 10 OK SL MOD: SL102

P8180SL160703 DL-Mac2 08.04.03

175#


10 INVESTMENTS IN ASSOCIATES (cont’d)


Name of Incorporation Equity Interest

Associates and Operation Held by Group Principal Activities

2002 2001

% %

Acumen Engineering Singapore 26.8 – Trading of plastic resinsPte Ltd and itssubsidiary: (1)

Acumen Kinetics Malaysia 13.7 – Trading of plastic resinsSdn Bhd (2) and other related products

Avaplas Ltd and its Singapore 18.9 – Plastic injection moulding withsubsidiaries: (3) secondary processes

and sub-assembly

Avaplas (Thailand) Thailand 18.9 – Plastic injection moulding withLimited (3) secondary processes and

sub-assembly

Avaplas (Shanghai) People’s Republic 18.9 – Plastic injection moulding withCo., Ltd (4) of China secondary processes and

sub-assembly

Fischer Tech Ltd Singapore 16.5 – Manufacture of plastic injection and its subsidiaries: (3) moulds and mouldings

with secondary processes

Fon-Fisher Pte Ltd (3) Singapore 16.5 – Manufacture of plastic injectionmoulds and mouldings withsecondary processes

Fischer Tech Singapore 14.1 – Investment holdingInternational Pte Ltd (3)

Fischer Tech (Suzhou) People’s Republic 14.1 – Plastic injection moulding withCo., Ltd (5) of China secondary processes and

sub-assembly

SEB Corporation Pte Ltd Singapore 21.9 – Investment holdingand its subsidiaries: (12)

SEB Engineering Singapore 21.9 – Manufacturing and trading& Trading Pte Ltd (6) of printed circuit board

toolings, metal tools anddies and metal stamping

SEB Plastic Pte Ltd (6) Singapore 21.9 – Plastic injection moulding

SEB Precision Pte Ltd (7) Singapore 14.2 – Manufacture of printed circuitboard tools and mechanical engineering works

SEB Engineering Hong Kong 21.9 – Investment holding(HK) Limited (8)







2002 2001 2002 2001

$’000 $’000 % %

Venture Electronics Malaysia 17,777 – 100 – Manufacture and sale of Services (Malaysia) removable disk drives andSdn Bhd (formerly cartridge storage mediaknown as Iomega(Malaysia) Sdn Bhd) (2)

Venture International United Kingdom – Note(a) – 100 DormantMarketing Ltd

Total 122,345 15,328

Note (a) – The cost of investment is less than $1,000.

All the companies are audited by Deloitte & Touche, Singapore except for the subsidiaries that are indicated as follows:(1) Audited by overseas practices of Deloitte Touche Tohmatsu.(2) Audited by another firm of auditors, Ernst & Young.(3) Not required to be audited by law in its country of incorporation.

Advances to and from subsidiaries are unsecured, interest-free and without fixed repayment terms.

The company has been granted the option (the “Call Option”) to acquire the balance of 33 per cent. of the total issuedshare capital of Univac Precision Engineering Pte Ltd (“Univac”) (the “Option Shares”) held by the vendors. Each of thevendors has also been granted a corresponding option (the “Put Option”) to require the company to acquire the OptionShares from them. The Call Option and the Put Option shall be exercisable at any time after the audited accounts of thecompany for the financial year ended December 31, 2002 have been approved at the annual general meeting of thecompany but no later than the date falling three years after the date of such annual general meeting (unless extended bymutual agreement of the company and the vendors).

The purchase price for each Option Share held by a vendor upon exercise of the Call Option or the Put Option (as thecase may be) shall be a sum equivalent to 11 times the consolidated audited net profit after tax attributable to theshareholders of Univac, determined by reference to the latest audited accounts of the Univac Group immediatelypreceding the exercise of the Call Option or the Put Option (as the case may be), divided by the total number of issuedordinary shares for the time being in the capital of Univac. The aggregate purchase price payable by the company to eachvendor for the Option Shares shall be satisfied in full by the allotment and issue of new shares by the company to thevendors in accordance with a prescribed formula.

10 INVESTMENTS IN ASSOCIATESThe Group

2002 2001

$’000 $’000

Quoted equity shares, at cost 18,522 –Unquoted equity shares, at cost 4,314 –

22,836 –Share of post-acquistion profits 1,358 –

24,194 –

Market value of quoted equity shares 21,173 –

The investments in associates are held by Univac Precision Engineering Pte Ltd, a 67% owned subsidiary of the group.


K


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P8180SL160703 DL-Mac2 08.04.03 175#

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P8180SL160703 DL-Mac2 08.04.03

175#


12 OTHER INVESTMENTSThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Quoted equity shares in corporations, at cost 5,522 – 53,559 20,128

Impairment loss (4,608) – (10,826) (2,018)

914 – 42,733 18,110Unquoted equity shares in corporations,

at cost – – 3,301 2,738

Total 914 – 46,034 20,848

Market value of quoted equity shares 914 – 33,778 18,110

Movement in impairment loss:Balance at beginning of year – – 2,018 1,118Charge during the year (Note 24) 4,608 – 8,808 900

Balance at end of year 4,608 – 10,826 2,018

13 PROPERTY, PLANT AND EQUIPMENT

Office

Machinery Leasehold equipment,

Freehold Freehold and improvements furniture Motor

land building equipment and renovations and fittings vehicles Total

$'000 $’000 $’000 $’000 $’000 $’000 $’000

The Company

Cost:At beginning of year 6,576 2,500 64,069 2,800 6,437 1,151 83,533Additions – – 3,002 797 725 396 4,920Disposals – – (422) (101) (82) (41) (646)

At end of year 6,576 2,500 66,649 3,496 7,080 1,506 87,807

Accumulated depreciation:At beginning of year – 250 43,309 2,178 4,442 717 50,896Additions – 83 6,161 429 1,237 141 8,051Disposals – – (322) (52) (70) (41) (485)

At end of year – 333 49,148 2,555 5,609 817 58,462

Depreciation for last year – 84 5,678 275 1,468 121 7,626

Net book value:At beginning of year 6,576 2,250 20,760 622 1,995 434 32,637

At end of year 6,576 2,167 17,501 941 1,471 689 29,345



10 INVESTMENTS IN ASSOCIATES (cont’d)


Name of Incorporation Equity Interest

Associates and Operation Held by Group Principal Activities

2002 2001

% %

SEB Metal & Plastic People’s Republic 21.9 – Plastic injection moulding(Panyu) Co Ltd (9) of China and metal stamping

Sin Star Hou Singapore 21.9 – Manufacture of plastic injectionEngineering Pte Ltd (10) moulds and related

engineering activities

Sin Star Hou Malaysia 21.9 – Manufacture of plastic injectionEngineering Sdn Bhd (11) moulds, metal tools and

dies, plastic injection mouldingand metal stamping

Western Univac Singapore 21.9 – Manufacture of plasticPte Ltd (10) injection moulds and mould

components

Univac Design & Singapore 31.7 – Investment holdingEngineering Pte Ltdand its subsidiary: (10)

Univac Precision People’s Republic 31.7 – Manufacture of plastic injection Plastics (Shanghai) of China moulds and mouldings withCo Ltd (4) secondary processes and

sub-assembly(1) Audited by Deloitte & Touche, Singapore.(2) Audited by another firm of auditors, OEK & Partners.(3) Audited by another firm of auditors, Ernst & Young.(4) Audited by another firm of auditors, Shanghai Shangshen Certified Public Accountants Co, Ltd.(5) Audited by another firm of auditors, Suxin United Certified Public Accountants.(6) Audited by another firm of auditors, PricewaterhouseCoopers.(7) Audited by another firm of auditors, K F Hoong & Co.(8) Audited by another firm of auditors, Ho, Sneddon, Chui.(9) Audited by another firm of auditors, Guang Dong Xie He Certified Partnership Public Accountants.(10) Audited by another firm of auditors, Boon Suan Lee & Co.(11) Audited by another firm of auditors, Horwath Teoh Yap.(12) Not required to be audited.

11 INVESTMENT IN JOINT VENTUREThe Company

2002 2001

$’000 $’000

Unquoted equity shares, at cost 1,000 1,000

The company has a 50% interest in a joint venture, VS Electronics Pte Ltd, incorporated in the Republic of Singapore,whose principal activities are those of research and development, sales and marketing, redesigning and manufacturingof system electronics products and other related products.

The group financial statements include a proportionate share of the joint venture’s current assets of $470,000 (2001 :$2,016,000), non-current assets of $201,000 (2001 : $320,000), current liabilities of $108,000 (2001 : $1,622,000) and netloss after tax of $79,000 (2001 : net loss after tax of $1,019,000).


K


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P8180SL160703 DL-Mac2 08.04.03 175#

LCL1

LCL1K


1 2 3 4 5 6 7 8 9 10 OK SL MOD: SL102

P8180SL160703 DL-Mac2 08.04.03

175#


13 PROPERTY, PLANT AND EQUIPMENT (cont’d)

Office

Leasehold equipment,

improvements furniture Computer Motor

and renovations and fittings hardware vehicles Total

$’000 $’000 $’000 $’000 $’000

The Group

Cost:At beginning of year 6,585 10,686 1,748 1,908 212,401On acquisition of

subsidiaries 4,015 7,580 – 1,535 98,504Exchange differences (142) (214) (70) (21) (4,810)Additions 1,290 3,061 1,542 447 49,515Disposals (118) (125) (31) (365) (8,628)

At end of year 11,630 20,988 3,189 3,504 346,982

Accumulated depreciation:At beginning of year 3,378 6,662 434 1,273 98,141On acquisition of

subsidiaries 3,411 6,075 – 1,159 59,518Exchange differences (83) (142) (33) (13) (2,290)Additions 1,540 2,720 653 281 34,256Disposals (69) (99) (4) (359) (5,073)

At end of year 8,177 15,216 1,050 2,341 184,552

Depreciation for last year 536 2,442 429 176 26,780

Net book value:At beginning of year 3,207 4,024 1,314 635 114,260

At end of year 3,453 5,772 2,139 1,163 162,430



13 PROPERTY, PLANT AND EQUIPMENT (cont’d)

Machinery

Freehold Leasehold Factory Freehold Leasehold and

land land building building building equipment

$’000 $'000 $'000 $’000 $’000 $’000

The Group

Cost:At beginning of year 10,077 – 12,538 2,837 – 166,022On acquisition of

subsidiaries – 3,530 – – 29,179 52,665Exchange differences (146) (63) (523) – (521) (3,110)Additions – – 268 – – 42,907Disposals – – – – – (7,989)

At end of year 9,931 3,467 12,283 2,837 28,658 250,495

Accumulated depreciation:At beginning of year – – 839 310 – 85,245On acquisition of

subsidiaries – 344 – – 10,929 37,600Exchange differences – (6) (40) – (197) (1,776)Additions – 10 250 92 161 28,549Disposals – – – – – (4,542)

At end of year – 348 1,049 402 10,893 145,076

Depreciation for last year – – 244 93 – 22,860

Net book value:At beginning of year 10,077 – 11,699 2,527 – 80,777

At end of year 9,931 3,119 11,234 2,435 17,765 105,419

A total grant of $482,070 (2001 : $482,070) received from the National Science and Technology Board has been creditedagainst the cost of computer equipment included in office equipment, furniture and fitting above for the company andgroup.


K


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P8180SL160703 DL-Mac2 08.04.03

175#


16 SHORT TERM BANK LOANS

The short-term bank loans of subsidiaries bear interest at a rate of 2.2% to 6% (2001 : 5.8% to 10.5%) per annum. The short-term bank loans include bank loans of a subsidiary which are secured by a standby letter of credit granted bythe company.

17 OTHER PAYABLESThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Other creditors 579 280 4,950 990Salary related accruals 14,010 15,488 26,667 21,153Accrued expenses 11,656 10,709 23,339 17,389Due to directors 10,703 10,342 10,792 10,343

Total 36,948 36,819 65,748 49,875

The amount due to directors is unsecured, interest-free and without fixed repayment terms.

18 DEFERRED INCOME TAXThe Group

2002 2001

$’000 $’000

Balance at beginning of year 4,188 3,646On acquisition of subsidiaries 1,191 – (Credit) Charge to income for the year (Note 26) (1,823) 440Exchange differences (98) 102

Balance at end of year 3,458 4,188

The above deferred income tax is mainly due to the tax effect of the foreign exchange differences and the excess ofcapital allowances over book depreciation.

19 ISSUED CAPITALThe Company

and The Group

2002 2001

$’000 $’000

AUTHORISED:500,000,000 (2001 : 500,000,000) ordinary shares

of $0.25 each 125,000 125,000

ISSUED AND FULLY PAID:240,314,280 (2001 : 231,102,617) ordinary shares

of $0.25 each 60,079 57,776

Movement during the year was:Balance at beginning of year 57,776 57,703Shares issued upon exercise of options 1,431 73Shares issued in consideration for acquisition of a subsidiary 872 –

Balance at end of year 60,079 57,776



14 INTANGIBLE ASSETSDevelopment

expenditure Computer

carried forward software Total

$’000 $’000 $’000

The Group

Costs:At beginning of year 17,840 6,863 24,703Additions 4,032 4,745 8,777Disposals (397) – (397)Exchange differences (56) – (56)

At end of year 21,419 11,608 33,027

Accumulated amortisation:At beginning of year 243 1,242 1,485Amortisation for the year (Note 24) 4,536 2,347 6,883Disposals (397) – (397)Exchange differences (45) – (45)

At end of year 4,337 3,589 7,926

Amortisation for last year 66 1,242 1,308

Net book value:At beginning of year 17,597 5,621 23,218

At end of year 17,082 8,019 25,101

The development expenditure carried forward included the following charges incurred during the year:

The Group

2002 2001

$’000 $’000

Development expenditure – 6,149Depreciation expense – 378

15 GOODWILL ON CONSOLIDATIONThe Group

$’000

Costs:At beginning of year 2,970Acquisition of subsidiary 51,041

At end of year 54,011

Accumulated amortisation:At beginning of year 1,034Amortisation for the year (Note 24) 1,511


Amortisation for last year 69

Net book value:At beginning of year 1,936



K


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P8180SL160703 DL-Mac2 08.04.03 175#

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LCL1K


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P8180SL160703 DL-Mac2 08.04.03

175#


21 OTHER OPERATING INCOMEThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Government grants 2,506 – 2,628 – Research and development income 591 568 591 568Management fee from related companies 1,172 852 – – Bad debts recovered 11 4,099 11 4,099Reversal of impairment loss on equity

linked deposits 192 – 192 – Gain on sale of fixed rate bonds – 995 – 995Rental income 147 100 181 100Commission received – – 292 – Other income 3,939 1,304 2,168 1,328

8,558 7,918 6,063 7,090

22 STAFF COSTSThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Operating 55,664 59,899 134,070 105,715Research and development 7,103 3,745 11,405 3,745Costs of defined contribution plans

included in staff costs 4,350 3,467 8,908 5,719

67,117 67,111 154,383 115,179

Number of employees at end of year 1,925 1,640 11,277 5,367

23 INTEREST INCOME (NET OF INTEREST EXPENSE)The Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Interest income from outside parties 8,725 9,023 12,560 11,507Interest expense to outside parties (1) (13) (443) (329)

8,724 9,010 12,117 11,178



19 ISSUED CAPITAL (cont’d)

During the financial year, the company made the following share issues:

i) 31,000 new ordinary shares of $0.25 each at a price of $3.64 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

ii) 10,000 new ordinary shares of $0.25 each at a price of $5.73 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

iii) 109,000 new ordinary shares of $0.25 each at a price of $5.40 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

iv) 30,000 new ordinary shares of $0.25 each at a price of $4.98 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

v) 693,000 new ordinary shares of $0.25 each at a price of $14.40 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

vi) 506,000 new ordinary shares of $0.25 each at a price of $14.60 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

vii) 822,000 new ordinary shares of $0.25 each at a price of $12.27 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

viii) 3,521,000 new ordinary shares of $0.25 each at a price of $8.05 per share following the exercise of options byexecutives of the company granted in conjunction with the Venture Corporation Limited Executives’ Share OptionScheme.

ix) 3,489,663 new ordinary shares of $0.25 each at a price of $16.7466 per share to the shareholders of UnivacPrecision Engineering Pte Ltd (“Univac”) as part of the consideration paid pursuant to the Sale and PurchaseAgreement for the company’s acquisition of 67% of the total issued share capital of Univac.

The total number of options outstanding as at end of the year was 33,103,000 (2001 : 33,901,300).

20 REVENUEThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Rendering of electronic manufacturingand engineering services 1,385,441 963,138 2,365,514 1,430,150

Dividend income – – 738 712

1,385,441 963,138 2,366,252 1,430,862


K


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P8180SL160703 DL-Mac2 08.04.03 175#

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P8180SL160703 DL-Mac2 08.04.03

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26 INCOME TAX EXPENSEThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Income tax on profit for the year Current year 2,046 3,273 11,712 8,447Under provision in prior years – – 33 299

Deferred income tax (Note 18)Current year – – – 440Overprovision in prior years – – (1,823) –

Share of tax attributable to associates – – 194 –

Total 2,046 3,273 10,116 9,186

The income tax expense varied from the amount of income tax expense determined by applying the Singapore incometax rate of 22% (2001 : 24.5%) to profit before income tax as a result of the following differences:


2002 2001 2002 2001

$’000 $’000 $’000 $’000

Income tax expense at statutory tax rate 17,666 24,704 42,722 35,215Non-allowable items 959 1,098 1,118 944(Over) Underprovision of income tax

in prior years – – (1,790) 299Prior years’ tax loss carryforwards utilised – – (281) (293)Deferred tax benefits not recognised – – 2,024 2,640Effect of different tax rates of

overseas operations – – 5,028 1,301Tax exempt income (14,247) (22,531) (38,672) (31,360)Utilisation of benefit under group tax relief (2,390) – – – Other items 58 2 (33) 440

Total income tax expense 2,046 3,273 10,116 9,186

Effective tax rate 2.55% 3.25% 5.21% 6.39%

The income tax expense for the company and the group is less than the amount determined by applying the statutorytax rates primarily due to tax incentives granted to the company and its subsidiaries under pioneer status.

The Economic Development Board (EDB) of Singapore granted the company and one of its subsidiaries pioneer statusfor qualifying activities subject to the fulfillment of certain conditions, for a period of five years commencing August 1,1999.



24 PROFIT BEFORE INCOME TAX AND MINORITY INTERESTS

In addition to the charges and credits disclosed elsewhere in the notes to the financial statements, this item includes thefollowing charges (credits):


2002 2001 2002 2001

$’000 $’000 $’000 $’000

Directors’ remuneration (Note 25):Directors of the company 12,064 11,598 12,064 11,638Directors of the subsidiaries and joint venture – – 1,271 320

Directors’ fees paid to directors of the company 86 62 86 62Depreciation expense 8,051 7,626 34,256 26,402Inventories written off 220 321 1,152 2,191Bad debts written off – – 101 125Allowance for inventory, net (Note 8) 125 (1,311) 176 (1,640)Auditors’ remuneration:

Audit services:Auditors of the company 48 48 48 48Auditors of the subsidiaries – – 215 160

Non-audit services:Auditors of company 105 11 105 11Auditors of subsidiaries 23 – 23 5

Amortisation of intangible assets (Note 14) – – 6,883 1,308Amortisation of goodwill (Note 15) – – 1,511 69Goodwill written off – – – 12Professional fees paid to a firm of which a

director of the subsidiary is a member – – 1 2(Reversal of) impairment loss on

equity linked deposits (Note 5) (1,800) 4,300 (1,800) 4,300Impairment loss on other investments (Note 12) 4,608 – 8,808 900Dividend income from quoted equity

investments (Gross) – – (738) (712)Loss on disposal of plant and equipment, net 57 61 41 61Gain on disposal of investment in associates – – – (28)

25 DIRECTORS’ REMUNERATION

Number of directors of the company in remuneration bands for the year ended December 31, 2002 and December 31,2001 are as follows:

2002 2001

$’000 $’000

$500,000 and above 3 3$250,000 to $499,999 – –Below $250,000 3 3

Total 6 6


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P8180SL160703 DL-Mac2 08.04.03

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28 OPERATING LEASE COMMITMENTSThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Minimum lease payments paid under operating leases 5,520 6,053 12,166 10,483

At the balance sheet date, the commitments in respect of operating leases with a term of more than one year were asfollows:


2002 2001 2002 2001

$’000 $’000 $’000 $’000

Within one year 5,545 4,939 12,617 8,304In the second to fifth year inclusive 1,268 2,518 10,320 5,779

29 FUTURE CAPITAL EXPENDITUREThe Group

2002 2001

$’000 $’000

Estimated amounts committed for future capital expenditurebut not provided for in the financial statements 3,410 2,111

30 CONTINGENT LIABILITIESThe Company The Group

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Letters of guarantee issued by bankers 4,798 3,637 6,188 5,102Standby letter of credit 5,975 6,042 5,975 6,042Corporate guarantees given to banks

for banking facilities granted toassociates – – 4,320 –



26 INCOME TAX EXPENSE (cont’d)

3 subsidiaries in Malaysia were granted pioneer status which exempts profits derived from pioneer products from incometax for the following periods:

a) Technocom Systems Sdn Bhd : 10 years commencing January 1, 2002.

b) Pintarmas Sdn Bhd : 5 years and 6 years commencing January 1, 1997 and January 1, 2001 respectively for differentrange of products.

c) Venture Electronics Services (Malaysia) Sdn Bhd : 5 years commencing September 1, 2001.

The group has estimated tax losses and unabsorbed capital allowances amounting to approximately $15,721,000 (2001 :$11,389,000) which are available for offsetting against future taxable income subject to the conditions for deductibilityimposed by law, including the retention of majority shareholders as defined. Unrecorded deferred tax benefits amountedto approximately $3,458,000 (2001 : $2,790,000).

27 EARNINGS PER SHAREThe Group

2002 2001

Basic Diluted Basic Diluted

$’000 $’000 $’000 $’000

Net profit attributable toshareholders 181,099 181,099 134,681 134,681

Number of shares Number of shares

’000 ’000

Weighted average number of ordinary shares 234,870 234,870 230,984 230,984

Adjustment for potential dilutiveordinary shares – 10,426 – 2,342

Weighted average number of ordinary shares used to compute earnings per share 234,870 245,296 230,984 233,326

Earnings per share (cents) 77.1 73.8 58.3 57.7


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P8180SL160703 DL-Mac2 08.04.03 175#

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31 SEGMENT INFORMATION (cont’d)Asia-Pacific United States

(excluding of America/

Singapore Singapore) Mexico/Others Eliminations Group

$’000 $’000 $’000 $’000 $’000

2001

Revenue:External sales 1,212,851 190,026 27,985 – 1,430,862Inter-segment sales 327,938 296,370 15,278 (639,586) –

Total revenue 1,540,789 486,396 43,263 (639,586) 1,430,862

Results:Profit (Loss) from operations 103,667 32,766 (4,921) 1,045 132,557Interest income (net of

interest expense) 10,122 1,291 (235) – 11,178

Profit (Loss) before income tax 113,789 34,057 (5,156) 1,045 143,735

Income tax expense (9,186)

Profit after income tax 134,549

Other information:Capital additions 28,658 13,889 8,667 – 51,214Depreciation and

amortisation 16,836 8,536 2,502 (83) 27,791

Assets:Segment assets 722,099 130,841 33,045 – 885,985

Liabilities:Segment liabilities 118,413 61,747 29,463 – 209,623Unallocated corporate

liabilities 10,532

220,155

Segment revenue and expenses are the operating revenue and expense reported in the group’s profit and loss statementthat are direcly attributable to a segment and the relevant portion of such revenue and expenses that can be allocatedon a reasonable basis to a segment.

Inter-segment pricing is determined on terms agreed between the parties of the transaction.

Business segments

The following table provides an analysis of the group's revenue by business segments.2002 2001

$’000 $’000

Design, manufacturing and fulfillment services in electronics industry 2,366,252 1,430,862

The following is an analysis of the carrying amount of segment assets and additions to property, plant and equipment,goodwill and intangible assets, analysed by the business segments in which the assets are located:

Segment assets Capital additions

2002 2001 2002 2001

$’000 $’000 $’000 $’000

Design, manufacturing and fulfillment services in electronics industry 1,427,104 885,985 109,333 51,214



31 SEGMENT INFORMATION

The group operates predominantly as a provider of manufacturing, engineering, design and fulfillment services to theelectronics industry.

Asia-Pacific United States

(excluding of America/

Singapore Singapore) Mexico/Others Eliminations Group

$’000 $’000 $’000 $’000 $’000

Geographical segments

by location of assets

2002

Revenue:External sales 2,155,289 177,069 33,894 – 2,366,252Inter-segment sales 422,344 1,298,295 39,626 (1,760,265) –

Total revenue 2,577,633 1,475,364 73,520 (1,760,265) 2,366,252

Results:Profit (Loss) from operations 105,241 85,534 (6,763) (3,492) 180,520Interest income (net of

interest expense) 9,540 755 1,822 – 12,117Income from

associates 1,552 – – – 1,552

Profit (Loss) before income tax 116,333 86,289 (4,941) (3,492) 194,189

Income tax expense (10,116)

Profit after income tax 184,073

Other information:Capital additions 69,821 36,767 2,745 – 109,333Depreciation and

amortisation 24,714 13,966 4,053 (83) 42,650

Assets:Segment assets 1,013,489 316,849 67,216 – 1,397,554Investment in

associates 24,194 – – – 24,194Unallocated corporate

assets 5,356

1,427,104

Liabilities:Segment liabilities 217,010 224,212 9,271 – 450,493Unallocated corporate

liabilities 11,190

461,683


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STATEMENT OF DIRECTORS

In the opinion of the directors, the financial statements of the company and consolidated financial statements of the groupset out on pages 35 to 68 are drawn up so as to give a true and fair view of the state of affairs of the company and of thegroup as at December 31, 2002, and of the results of the business and changes in equity of the company and of the group,and of the cash flows of the group for the financial year then ended and at the date of this statement there are reasonablegrounds to believe that the company will be able to pay its debts as and when they fall due.

ON BEHALF OF THE BOARD

Wong Ngit Liong


March 7, 2003



32 SUBSEQUENT EVENTS

Subsequent to the year end date,

a) The directors of the company proposed a first and final tax exempt dividend of 15% and a tax exempt bonus dividendof 15% on the ordinary shares of the company, amounting to $18,023,571 in respect of the company’s financial yearended December 31, 2002.

The proposed first and final tax exempt dividend and tax exempt bonus dividend are subject to the approval of theshareholders.

b) 1,535,000 new ordinary shares were issued for options exercised, hence the issued and paid up capital of thecompany was increased to $60,462,320 divided into 241,849,280 ordinary shares of $0.25 each.

33 MAJOR PROPERTIES

The schedule below shows the group’s major properties together with particulars of their tenure and usage:

Description and

Held by Location Approx. Land Area Tenure Usage

Pintarmas Lot 3789 Mukim Land area: Freehold ManufacturingSdn Bhd of Terbau, Johore 40,469 sq. m. facilities

Bahru, Malaysia Industrial land

Venture No.44, Hilir Sungai Land area: 60 years leasehold ManufacturingElectronics Keluang Satu, Taman 39,536 sq. m. from June 13, facilitiesServices Perindustrian Industrial land 1995(Malaysia) Bayan Lepas (Fasa IV),Sdn Bhd 11900 Bayan Lepas,

Penang, Malaysia

Venture Lot 7114 Mukim 17 Gross floor area: Freehold ResidentialCorporation Singapore 1,424.6 sq. m. PropertyLimited

Cebelian 69 Huang Yang Gross floor area: 70 years leasehold LeaseHoldings Road Block 2, 6/F 156.48 sq. m. from November 30,Pte Ltd Unit D, Xinhe 1994

Gardens, JinqiaoPudong Shanghai201206 People’s Republic of China


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1.7 At least one of the Company Secretaries is present at Board meetings. It is the responsibility of the CompanySecretaries to ensure that Board procedures and applicable rules and regulations are followed and complied with.

1.8 Nominating Committee (“NC”)

1.8.1 The Code prescribes guidelines on various Board matters, including the Board’s conduct of its affairs, itscomposition, its membership, its performance and its access to information. The NC is tasked with theresponsibility of overseeing Board membership and monitoring Board performance.

1.8.2 The NC’s principal functions are to:

a) ensure that there is an appropriate composition of members of the Board with suitably diverse backgroundsin order to meet the Company’s operational and business requirements;

b) establish a formal and transparent process for the appointment of new Directors;c) nominate Directors retiring by rotation for re-election at every Annual General Meeting (“AGM”) pursuant to

Articles 92 and 93 of the Company’s Articles;d) ensure all Directors submit themselves for re-nomination and re-election at least once every three years; e) assess the Directors’ independence; f) decide how the Board’s performance and effectiveness may be evaluated and propose objective performance

criteria for the Board’s approval.

1.8.3 The NC is chaired by Mr. Koh Lee Boon and has two other members, namely Mr. Cecil Vivian Richard Wong andMr. Wong Ngit Liong.

1.8.4 The NC met once during FY2002.

1.8.5 The NC evaluates the Board’s performance as a whole. The assessment process adopts both quantitative andqualitative criteria, such as the success of the strategic and long-term objectives set by the Board, and theeffectiveness of the Board in monitoring Management’s performance against the goals that have been set. TheNC will be initiating a Board performance evaluation in FY 2003.

1.8.6 The NC have nominated the directors retiring by rotation at the forthcoming AGM for re-election. In consideringthe nomination, the NC have taken into account the contribution of the directors with reference to theirattendance and participation at Board and other Board committee meetings as well as the proficiency with whichthey have discharged their responsibilities.

2. Remuneration Matters

2.1 Compensation Committee (“CC”)

2.1.1 The CC is chaired by Mr. Gopala Achuta Menon and has two other members, namely Mr. Cecil Vivian RichardWong and Mr. Koh Lee Boon.

2.1.2 The CC’s principal functions are to:

a) approve the structure of the compensation programme for Directors and senior management to ensure thatthe programme is competitive and sufficient to attract, retain and motivate senior management of therequired quality to run the Company successfully;

b) recommend to the Board base pay levels, benefits and incentive opportunities, and identify components ofpay which can best be used to focus management staff on achieving corporate objectives;

c) undertake specific administrative roles including:(i) reviewing Directors’ and senior management’s compensation annually and determine appropriate

adjustments;(ii) reviewing and recommending the CEO’s pay adjustment with respect to other management

appointments; and (iii) participating in hiring decisions of senior management appointments in the office of the CEO.

2.1.3 The CC met once during FY2002.


CORPORATE GOVERNANCE

The Company is committed to support and observe full compliance with the Listing Manual requirements of the SingaporeExchange Limited to describe its corporate governance practices with specific reference to the Code of CorporateGovernance (“Code”) issued by the Ministry of Finance’s Corporate Governance Committee (“CGC”).

1. Board Matters

1.1 The Board supervises the management of the Group’s business and affairs and approves its strategic operationalinitiatives, major investments and capital structure. In addition to its statutory responsibilities, the Board approvesthe Group’s financial plans and reviews its financial performance.

1.2 The Board held four meetings in FY2002. The Company’s Articles of Association (“Articles”) allows a Director toparticipate in a Board meeting by telephone conference or other similar means whereby all persons participatingin the meeting are able to hear each other, without requiring a Director’s physical presence at the meeting. Theattendance of the Directors at meetings of the Board and Board Committees, as well as frequency of suchmeetings, are as follows:

Board Board Committee

Audit Nominating Compensation

Committee Committee Committee

a b a b a b a b

G. A. Menon 4 4 3 3 – – 1 1

Wong Ngit Liong 4 4 – – 1 1 – –

Cecil Vivian Richard Wong 4 4 3 3 1 1 1 1

Koh Lee Boon 4 4 3 3 1 1 1 1

Tan Choon Huat 4 1 – – – – – –

Soo Eng Hiong 4 2 – – – – – –

Column a : Number of meetings held while as a memberColumn b : Number of meetings attended

1.3 Presently, the Board comprises six directors namely Mr. Gopala Achuta Menon (Non-Executive Chairman), Mr.Wong Ngit Liong (Chief Executive Officer), Mr. Cecil Vivian Richard Wong (Independent, Non-Executive), Mr. KohLee Boon (Independent, Non-Executive), Mr. Tan Choon Huat (Executive) and Mr. Soo Eng Hiong (Executive andalternate to Mr. Tan Choon Huat). The independence of each director is reviewed annually by the NominatingCommittee (“NC”). The NC adopts the Code’s definition of what constitutes an independent director in its review.Key information regarding the Directors is given in this annual report.

1.4 The Company’s Chairman is Mr. Gopala Achuta Menon and its CEO is Mr. Wong Ngit Liong. The roles of theChairman and the CEO are separate and they are not related to each other. This division of responsibilities ensuresthat there are checks and balances on their individual power and authority on the Company.

1.5 In order to ensure that the Board is able to fulfill its responsibilities, Management provides annual budget figures,monthly management accounts and any other information as and when required. The Directors have also beenprovided with the telephone numbers and email particulars of the Company’s senior management and theCompany Secretaries to facilitate access.

1.6 The Company will consider appropriate training programmes for directors to meet their relevant training needs.Orientation programmes will be organised for new directors to ensure that they are familiar with the Company’sbusiness and governance policies.


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2.2.1 The Company’s Executive Share Option Scheme (“ESOS”), which has been approved by the shareholders of theCompany, is administered by the SOC whose members are Mr. Cecil Vivian Richard Wong (Chairman), Mr. GopalaAchuta Menon, Mr. Koh Lee Boon and Mr. Wong Ngit Liong. In discharging its responsibilities, the SOC wouldtake into account certain criteria as established in the Company’s ESOS for evaluating the eligibility of employeesto participate under the scheme.

2.2.2 The SOC met once during FY2002.

3. Accountability and Audit

3.1 The Board currently provides shareholders with the Company’s performance, position and prospects on a half-yearly basis via announcements to the SGX. The publication of such information will be changed to a quarterlybasis effective in FY2003, in compliance with requirements of the Code and the SGX

3.2 Audit Committee (“AC”)

3.2.1 The AC comprises three members, all of whom are non-executive. They are Mr. Cecil Vivian Richard Wong(Chairman), Mr. Koh Lee Boon and Mr. Gopala Achuta Menon (non-independent).

3.2.2 The functions of the AC are to:

a) recommend to the Board the re-appointment of the external auditors, to approve the remuneration of theexternal auditors, and to review the scope and results of the audit, and its cost effectiveness;

b) inquire of other committees, Management, the Head of Internal Audit and the external auditors aboutsignificant risks and exposure that exist, and assess the steps Management has taken to minimize such risksto the Company;

c) review with the Chief Financial Officer and external auditors at the completion of the quarterly reviews andannual examination:(i) the Company’s quarterly, interim and annual financial statements and related footnotes, including

accounting principles;(ii) the external auditors’ audit of the financial statements and reports thereto;(iii) the adequacy of the Company’s system of accounting controls;(iv) the assistance given by the Management to the external auditors;(v) any related significant findings and recommendations of the external auditors and internal auditors

together with Management’s responses thereto; and(vi) any significant changes required in the external auditors’ plan, any serious difficulties or disputes with

Management encountered during the course of the audit and their resolutions, and any other mattersrelated to the conduct of the audit.

d) consider and review with Management and the Head of Internal Audit annually:(i) significant findings during the year and Management’s responses thereto;(ii) the effectiveness of the Company’s internal controls over management, business and service systems

and practices;(iii) any changes required in the planned scope of their audit plan and any difficulties encountered in the

course of their audits, including any restrictions on the scope of their work or access to requiredinformation; and

(iv) the internal audit department budget and staffing.e) review legal and regulatory matters that may have a material impact on the financial statements, related

exchange compliance policies, and programmes and reports reviewed from regulators;f) meet with the Head of Internal Audit, the external auditors, other committees, and Management in separate

executive sessions to discuss any matters that these groups believe should be discussed privately with theAC; and

g) report actions and minutes of the AC to the Board with such recommendations as the AC may deemappropriate.

3.2.3 The AC met three times during FY2002.

3.2.4 The AC has full access to and co-operation of the Management. The external auditors and Head of Internal Audithave unrestricted access to the AC.

72 Venture Annual Report 200272 Venture Annual Report 2002

CORPORATE GOVERNANCE

2.1.4 Directors’ fees are set in accordance with remuneration frameworks of basic fees. Executive Directors do notreceive directors’ fees. Non-Executive Directors are paid directors’ fees, subject to shareholders’ approval at theAGM. The CC has recommended that directors’ fees be paid for FY2002 for approval by shareholders at thecompany’s forth coming AGM. A breakdown showing the level and mix of each individual Director’s remunerationpaid and payable for FY2002 is as follows:

Remuneration Band # and Total Basic Total Variable Total

Name of Director Fee* Remuneration + Remuneration ** Remuneration

% % % %

Below S$250,000– G. A. Menon 100 – – 100– Cecil Vivian Richard Wong 100 – – 100– Koh Lee Boon 100 – – 100

S$1,250,000 to S$1,499,999– Soo Eng Hiong – 19 81 100

S$1,500,000 to S$1,749,999– Tan Choon Huat – 19 81 100

S$9,000,000 to S$9,249,999– Wong Ngit Liong – 6 94 100

2.1.5 Rather than set out the names of the top five key executives who are not also directors of the Company, theCompany has shown a group-wide cross-section of key executives’ remuneration by number of executivesearning within bands of S$250,000 and breakdown of remuneration into fixed and variable components. Thisshould give a macro perspective of the remuneration pattern in the Group, while maintaining confidentiality ofemployee remuneration matters.

Remuneration Band # No. of key Total Basic Total Variable Total

executives Remuneration + Remuneration ** Remuneration

S$’000 S$’000 S$’000

Below S$250,000 ++ 11 986 799 1,785S$250,000 – S$499,999 ++ 8 1,672 1,221 2,893S$500,000 – S$749,999 4 576 1,668 2,243S$750,000 – S$999,999 1 247 751 997S$1,500,000 – S$1,749,999 1 108 1,613 1,722S$2,250,000 – S$2,499,999 1 173 2,118 2,291S$2,500,000 – S$2,749,999 1 156 2,579 2,735S$3,250,000 – S$3,499,999 1 336 3,063 3,399

28 4,254 13,812 18,066

# Remuneration bands where no directors and executives fall within will not be included.* These fees are subject to approval by shareholders as a lump sum at the AGM for FY2002.+ Inclusive of CPF** Includes annual wage supplement, bonuses, gains from exercise of share options granted under the Venture Corporation Limited

Executive Share Option Scheme and benefits in kind such as housing and car allowances++ Includes 4 executives each in the “Below S$250,000” and “S$250,000 – S$499,000” bands who have joined the Group for less than

1 year

2.1.6 There are no employees in the Group who are immediate family members of a director or the CEO.

2.2 Share Option Committee (“SOC”)


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CORPORATE GOVERNANCE SHAREHOLDERS’ INFORMATIONAs at 4 April 2003

Authorised share capital : $125,000,000Issued and fully paid-up capital : $61,066,820Class of shares : Ordinary shares of $0.25 each

Analysis of Shareholdings as at 4 April 2003

Range of Shareholding No. of Share Holders % No. of Shares %

1 – 999 36 1.08 8,809 0.001,000 – 10,000 3,091 92.74 6,365,436 2.6110,001 – 1,000,000 194 5.82 12,241,286 5.011,000,001 and above 12 0.36 225,651,749 92.38

3,333 100.00 244,267,280 100.00

Substantial Shareholders as recorded in the Register of Substantial Shareholders

No. Name Direct Interest % Deemed Interest %

1 The Capital Group Companies, Inc – – 24,049,400 9.852 Schroder Investment Management Group – – 17,103,252 7.003 Metchem Engineering SA 15,965,007 6.54 – –4 Wong Ngit Liong 15,802,141 6.47 – –

Notes:(1) The Capital Group Companies, Inc is deemed to have an interest in the 24,049,400 shares registered in the name of ABN

Amro Nominees Singapore Pte Ltd, Citibank Nominees S’pore Pte Ltd, DBS Nominees Pte Ltd, Deutsche Bank AG, HSBC(Singapore) Pte Ltd, Raffles Nominees Pte Ltd and United Overseas Bank Nominees Pte Ltd.

(2) Schroder Investment Management Group is deemed to have an interest in the 17,103,252 shares registered in the nameof Schroder Investment Management (Singapore) Limited, Schroder Investment Management (Japan) Limited, SchroderInvestment Management (Hong Kong) Limited and Schroder Investment Management Limited.

Major Shareholders List – Top 20 as at 4 April 2003

No. Name No. of Shares Held %

1 DBS Nominees Pte Ltd 71,309,636 29.192 Raffles Nominees Pte Ltd 59,193,096 24.233 Citibank Nominees Singapore Pte Ltd 39,721,968 16.264 HSBC (Singapore) Nominees Pte Ltd 20,723,515 8.485 United Overseas Bank Nominees Pte Ltd 13,230,108 5.426 DB Nominees (S) Pte Ltd 10,259,192 4.207 Overseas Union Bank Nominees Pte Ltd 3,556,000 1.468 Oh Ah Kok @ Sandy Oh Ah Kok 1,989,108 0.819 Oversea-Chinese Bank Nominees Pte Ltd 1,821,209 0.7510 Morgan Stanley Asia (S’pore) Secs Pte Ltd 1,429,900 0.5911 Metchem Engineering SA 1,274,034 0.5212 Kim Eng Ong Asia Secs Pte Ltd 1,143,983 0.4713 Soo Eng Hiong 836,862 0.3414 Choi Peng Kum 828,790 0.3415 UOB Kay Hian Pte Ltd 789,000 0.3216 Chang Kok Choi Mark 742,781 0.3117 Citibank Consumer Nominees Pte Ltd 561,802 0.2318 HSBC Republic Bank (Suisse) SA 508,543 0.2119 DBS Vickers Secs (S) Pte Ltd 468,915 0.1920 Philip Securities Pte Ltd 467,896 0.19

230,856,338 94.51

SHAREHOLDING HELD IN HANDS OF PUBLIC

Based on information available to the Company as at 4 April 2003, 90.3% of the issued ordinary shares of the Company isheld by the public and therefore, Rule 723 of the Listing Manual issued by SGX-St is complied with.

3.2.5 The AC meets with the external auditors, without the presence of Management, at least once a year.

3.2.6 The AC has reviewed the Company’s risk assessment, and based on the management controls in place, it issatisfied that there are adequate internal controls in the Company. The AC expects the risk assessment processto be a continuing process.

3.2.7 The AC has reviewed all non-audit services provided by the external auditors during the year and is of the opinionthat the provision of such services will not affect the independence of the external auditors.

3.3 The Company’s internal audit (“IA”) function was established in FY2002. The IA reports directly to the Chairmanof the AC on audit matters, and to the CFO on administrative matters. The AC reviews and approves the annualIA plans and resources to ensure that the IA has the necessary resources to adequately perform its function.

3.4 The IA is responsible for the review of the effectiveness of internal control system and procedures such asfinancial, operational and compliance controls, for the Company and its subsidiaries (both local and overseas). TheIA will meet the standards set by nationally or internationally recognized professional bodies.

4. Communication with Shareholders

4.1 The Company conveys financial performance, position and prospects on a half-yearly basis via announcements tothe SGX. The Company also holds press conferences with the media and the investment community when itsresults are announced. The Company will report its results on a quarterly basis from FY2003.

4.2 The Company does not practise selective disclosure. Price sensitive information is first publicly released, eitherbefore the Company meets with any group of investors or analysts or simultaneously with such meetings.Results and annual reports are announced or issued within the mandatory period and are available on theCompany’s website.

4.3 The Company has a corporate communications team, which communicates with its investors on a regular basisand attends to their queries. All shareholders of the Company receive the annual report and notice of AGM. Thenotice is also advertised in the newspapers. At AGMs, shareholders are given the opportunity to air their viewsand ask directors, Management or the external auditors questions regarding the Company. All directors, externalauditors and the company secretaries are present at every AGM.

4.4 The Articles currently do not provide for shareholders to vote at AGMs in absentia such as by mail, email or fax.The Company will consider implementing the relevant amendment to the Articles if the Board is of the view thatthere is demand for the same, and after the Company has evaluated and put in place the necessary security andother measures to facilitate absentia voting and protect against errors, fraud and other irregularities.

5. Internal Code on Dealings with Securities

5.1 An internal code on dealing in securities of the Company has been issued to directors and officers setting out theimplications on insider trading. The Company’s directors and officers are not allowed to deal in the Company’sshares during the period commencing at least one month before the announcement of the Company’s results andending on the date of the announcement of the results.

5.2 The directors and officers are not expected to deal in the Company’s securities on considerations of a short-termnature.

5.3 Directors and officers are required to observe insider trading laws under the Securities Industries Act at all timeseven when dealing in securities within the permitted periods. To enable the Company to monitor suchtransactions, directors of the Company are required to report to the Company Secretaries whenever they deal inthe Company’s securities.

6. Material Contracts

6.1 There are no material contracts entered into by the company or any of its subsidiaries involving the interests ofthe CEO or any director.


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9. Authority to allot and issue shares under the Venture Corporation Limited Executives’ Share Option Scheme

That pursuant to Section 161 of the Companies Act, Cap. 50, the Directors be authorised and empowered to allot andissue shares in the capital of the Company to all the holders of options granted by the Company, whether granted duringthe subsistence of this authority or otherwise, under the Venture Corporation Limited Executives’ Share Option Scheme(“the Scheme”) upon the exercise of such options and in accordance with the terms and conditions of the Scheme,provided always that the aggregate number of additional ordinary shares to be allotted and issued pursuant to theScheme shall not exceed twenty five per centum (25%) of the issued share capital of the Company from time to time. [See Explanatory Note (iii)] (Resolution 9)

By Order of the Board

Yvonne ChooTan Lay HongCompany Secretaries

Singapore, 28 April 2003

Explanatory Notes:

(i) The Ordinary Resolutions 4 and 5 proposed in item 4 above, are to re-appoint Directors who are over 70 years of age.Section 153(6) of the Act provides that these resolutions have to be passed by a majority of three-fourths of shareholdersvoting at the Annual General Meeting of the Company.

(ii) The Ordinary Resolution 8 proposed in item 8 above, if passed, will empower the Directors from the date of the aboveMeeting until the date of the next Annual General Meeting, to allot and issue shares in the Company. The number ofshares that the Directors may allot and issue under this Resolution would not exceed ten per centum (10%) of theMaximum Share Capital of the Company at the time of the passing of this resolution.

The percentage of issued share capital is based on the Company’s issued share capital at the time the proposed OrdinaryResolution is passed (after adjusting for new shares arising from the conversion of convertible securities or employeeshare options on issue at the time the proposed Ordinary Resolution is passed, and any subsequent consolidation orsubdivision of shares).

(iii) The Ordinary Resolution 9 proposed in item 9 above, if passed, will empower the Directors of the Company, from thedate of the above Meeting until the next Annual General Meeting, to allot and issue shares in the Company of up to anumber not exceeding in total twenty five per centum (25%) of the issued share capital of the Company from time totime pursuant to the exercise of the options under the Scheme.

Notes :

1. A Member entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy to attend and vote inhis/her stead. A proxy need not be a Member of the Company.

2. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 10 Collyer Quay #19-08 Ocean Building, Singapore 049315 not less than 48 hours before the time for holding the meeting.

NOTICE IS HEREBY GIVEN that the Annual General Meeting of VENTURE CORPORATION LIMITED (“the Company”) willbe held at the Board Room, 5006, Ang Mo Kio Avenue 5, #05-01/12 TECHplace II, Singapore 569873 on 23 May 2003 at11.30 a.m. for the following purposes:

AS ORDINARY BUSINESS

1. To receive and adopt the Directors’ Report and the Audited Accounts of the Company for the year ended 31 December2002 together with the Auditors’ Report thereon. (Resolution 1)

2. To declare a final tax-exempt dividend of 15% and a bonus tax-exempt dividend of 15% for the year ended 31 December2002 (2001 : 10% and 10%) (Resolution 2)

3. To re-elect the following Directors retiring pursuant to Article 92 of the Company’s Articles of Association:Mr Tan Choon Huat [Retiring under Article 92] (Resolution 3)

4. To pass the following resolutions pursuant to Section 153(6) of the Companies Act, Cap. 50:-

That pursuant to Section 153(6) of the Companies Act, Cap. 50, the following Directors of the Company to hold office untilthe next Annual General Meeting.

Mr Cecil Vivian Richard Wong [Retiring under Section 153(6)] (Resolution 4)Mr Gopala Achuta Menon [Retiring under Section 153(6)] (Resolution 5)

Mr Cecil Vivian Richard Wong will, upon re-election as a Director of the Company, remain as a member of the AuditCommittee and will be considered independent for the purpose of Rule 704(8) of Listing Manual of the SingaporeExchange Securities Trading Limited.

Mr Gopala Achuta Menon will, upon re-election as a Director of the Company, remain as a member of the AuditCommittee and will be considered non-independent for the purpose of Rule 704(8) of Listing Manual of the SingaporeExchange Securities Trading Limited.

[See Explanatory Note (i)]

5. To approve the payment of Directors’ fees of S$86,000 for the year ended 31 December 2002 (2001 :S$62,000)(Resolution 6)

6. To re-appoint Deloitte & Touche as the Company’s Auditors and to authorise the Directors to fix their remuneration.(Resolution 7)

7. To transact any other ordinary business which may properly be transacted at an Annual General Meeting.

AS SPECIAL BUSINESS

To consider and if thought fit, to pass the following resolutions as Ordinary Resolutions, with or without any modifications:

8. Authority to allot and issue shares and convertible securities up to 50 per centum (50%) of issued capital

That pursuant to Section 161 of the Companies Act, Cap. 50 and Rule 806(2) of the Listing Manual of the SingaporeExchange Securities Trading Limited, the Directors be empowered to allot and issue shares and convertible securities inthe capital of the Company at any time and upon such terms and conditions and for such purposes as the Directors may,in their absolute discretion, deem fit provided that the aggregate number of shares and convertible securities to beallotted and issued pursuant to this Resolution shall not exceed fifty per centum (50%) of the issued share capital of theCompany at the time of the passing of this Resolution, of which the aggregate number of shares and convertiblesecurities to be issued other than on a pro rata basis to all shareholders of the Company shall not exceed twenty percentum (20%) of the issued share capital of the Company and that such authority shall, unless revoked or varied by theCompany in general meeting, continue in force until the conclusion of the Company’s next Annual General Meeting orthe date by which the next Annual General Meeting of the Company is required by law to be held, whichever is earlier. [See Explanatory Note (ii)] (Resolution 8)

76 Venture Annual Report 2002 Venture Annual Report 2002 77

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I/We,

of being a member/members of Venture Corporation Limited (the “Company”), hereby appoint:

Name NRIC/Passport No. Proportion of Shareholdings

No. of Shares %

Address

and/or (delete as appropriate)

Name NRIC/Passport No. Proportion of Shareholdings

No. of Shares %

Address

or failing him/her, the Chairman of the Meeting as my/our proxy/proxies to vote for me/us on my/our behalf at the AnnualGeneral Meeting (the “Meeting”) of the Company to be held on 23 May 2003 at 11.30 a.m. and at any adjournment thereof.I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the Meeting as indicated hereunder. Ifno specific direction as to voting is given or in the event of any other matter arising at the Meeting and at any adjournmentthereof, the proxy/proxies will vote or abstain from voting at his/her discretion.

(Please indicate your vote “For” or “Against” with a tick [✓] within the box provided.)

No. Resolutions relating to: For Against

1 Directors’ Report and Audited Accounts for the year ended 31 December 2002

2 Payment of proposed final dividend and bonus tax-exempt dividend

3 Re-election of Mr Tan Choon Huat

4 Re-election of Mr Cecil Vivian Richard Wong

5 Re-election of Mr Gopala Achuta Menon

6 Approval of Directors’ fees amounting to S$86,000

7 Re-appointment of Deloitte & Touche as Auditors

8 Authority to allot and issue new shares

9 Authority to allot and issue shares under theVenture Corporation Limited Executives’ Share Option Scheme

Dated this day of 2003.

Signature of Shareholder(s)or, Common Seal of Corporate Shareholder

*Delete where inapplicable

NOTICE IS HEREBY GIVEN that the Share Transfer Books and Register of Members of the Company will be closed from 3June 2003 to 4 June 2003 (both dates inclusive), for the purpose of determining Members’ entitlements to the final andbonus tax-exempt dividends to be proposed at the Annual General Meeting of the Company to be held on 23 May 2003.

The proposed tax-exempt dividends (comprises a final dividend of 15% and a bonus dividend of 15%), if approved at theAnnual General Meeting to be held on 23 May 2003, will be paid on 16 June 2003.

Duly completed registrable transfer of the shares in the Company (the “Shares”) received up to the close of business at 5.00p.m. on 2 June 2003 by the Company’s Share Registrar, M & C Services Private Limited, 138 Robinson Road, #17-00 TheCorporate Office, Singapore 068906 will be registered to determine shareholders’ entitlements to such dividends. Subject tothe aforesaid, Members whose Securities Accounts with the Central Depository (Pte) Limited are credited with shares as at2 June 2003 will be entitled to the proposed dividends.

BY ORDER OF THE BOARD

Yvonne ChooTan Lay HongCompany Secretaries

Singapore, 28 April 2003


PROXY FORM(Please see notes overleaf before completing this Form)

IMPORTANT

1. For investors who have used their CPF monies to buyordinary shares in the capital of Venture Corporation Limited,this document is forwarded to them at the request of theirCPF Approved Nominees and is sent solely FORINFORMATION ONLY

2. This Proxy Form is not valid for use by CPF investors andshall be ineffective for all intents and purposes if used orpurported to be used by them.

Total Number of Shares in: No. of Shares Held

(a) CDP Register

(b) Register of Members

NOTICE OF BOOK CLOSURE

✃

VENTURE CORPORATION LIMITED

(Incorporated in The Republic of Singapore with limited liability)


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P8180SL160703 DL-Mac2 08.04.03 175#

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Notes :

1. Please insert the total number of Shares held by you. If you have Shares entered against your name in the DepositoryRegister (as defined in Section 130A of the Companies Act, Chapter 50 of Singapore), you should insert that number ofShares. If you have Shares registered in your name in the Register of Members, you should insert that number of Shares.If you have Shares entered against your name in the Depository Register and Shares registered in your name in theRegister of Members, you should insert the aggregate number of Shares entered against your name in the DepositoryRegister and registered in your name in the Register of Members. If no number is inserted, the instrument appointing aproxy or proxies shall be deemed to relate to all the Shares held by you.

2. A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or twoproxies to attend and vote in his/her stead. A proxy need not be a member of the Company.

3. Where a member appoints two proxies, the appointments shall be invalid unless he/she specifies the proportion ofhis/her shareholding (expressed as a percentage of the whole) to be represented by each proxy.

4. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at 10 CollyerQuay #19-08 Ocean Building Singapore 049315 not less than 48 hours before the time appointed for the Meeting.

5. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorisedin writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed eitherunder its seal or under the hand of an officer or attorney duly authorised. Where the instrument appointing a proxy orproxies is executed by an attorney on behalf of the appointor, the letter or power of attorney or a duly certified copythereof must be lodged with the instrument.

6. A corporation which is a member may authorise by resolution of its directors or other governing body such person as itthinks fit to act as its representative at the Meeting, in accordance with Section 179 of the Companies Act, Chapter 50of Singapore.

General:

The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completedor illegible or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specifiedin the instrument appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, theCompany may reject any instrument appointing a proxy or proxies lodged if the member, being the appointor, is not shownto have Shares entered against his name in the Depository Register as at 48 hours before the time appointed for holding theMeeting, as certified by The Central Depository (Pte) Limited to the Company.

Concept and Design by Equuswww.equus-design.com


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2002

Venture Corporation Limited5006 Ang Mo Kio Avenue 5#05-01/12 TECHplace llSingapore 569873

CONTENTS

INTRODUCTION 1

MISSION MADE POSSIBLE 2

YEAR IN REVIEW 8

SERVICES & STRENGTHS 12

BOARD OF DIRECTORS 20

KEY MANAGEMENT 22

GROUP OF COMPANIES 24

FINANCIAL REPORT 25

02ANNUAL REPORT 2002


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