SCOMI GROUP BHD ANNUAL REPORT 2019 Contents 002 Key Financial Indicators 003 Key Financial Highlights 004 Corporate Structure 006 Corporate Statement 007 Corporate Information 008 Board of Directors 012 Key Senior Management 014 Management Discussion & Analysis 020 Sustainability Statement 022 Corporate Governance Overview Statement 037 Statement on Risk Management & Internal Control 040 Audit & Risk Management Committee Report 044 Additional Information 046 Statement of Directors’ Responsibility 047 Financial Statements 225 Analysis of Shareholdings 229 Analysis of Warrant Holdings 231 List of Properties 232 Corporate Directory 234 Notice of Annual General Meeting 239 Form of Proxy Key Financial Indicators 20191,2 20182 20173 20163 20153 RM’000 RM’000 RM’000 RM’000 RM’000 (Restated) Continuing operations Turnover 643,502 613,957 826,892 1,383,332 1,798,572 EBITDA (142,270) (114,613) 17,666 199,531 257,911 Depreciation and amortization 78,021 80,839 104,962 110,032 97,524 Finance costs 23,165 23,943 61,107 63,706 56,480 Share of (loss)/profit in associates (2,299) - - 495 (124) Share of (loss)/profit from joint ventures (3,866) (36,663) (24,208) (10,628) 1,117 (Loss)/Profit before tax (243,453) (219,395) (148,403) 25,793 103,907 Taxation (20,883) (13,058) (17,248) (13,889) (37,535) (Loss)/Profit from continuing operations (264,336) (232,453) (165,651) 11,904 66,372 Loss from discontinued operations (161,633) (99,629) - - (71) (Loss)/Profit for the year (425,969) (332,082)) (165,651) 11,904 66,301 Non-controlling interest 29,798 82,108 58,246 10,632 (22,045) (Loss)/Profit attributed to owners of the Company (396,171) (249,974) (107,405) 22,536 44,256 Numbers of shares in issue (‘000) 1,093,907 1,093,907 1,917,510 1,917,510 1,568,637 Weighted average number of shares assumed in issue (‘000) 1,093,907 1,092,657 1,903,083 1,903,083 1,554,210 Weighted average number of shares used to compute diluted earnings per share (‘000) 1,093,907 1,092,657 1,903,083 1,903,083 1,903,083 Basic - Net (Loss)/Earning Per Share (sen)** (36.22) (22.88) (5.64) 1.18 2.85 Fully diluted - Net (Loss)/Earning Per Share (sen)@ (36.22) (22.88) (5.64) 1.18 2.33 Notes ** Based on profit/(loss) attributed to owner of the Company and the weighted average number of shares assumed to be in issue in the respective period/year. @ Based on profit/(loss) attributed to owner of the Company and the weighted average number of shares assumed to be in issue in the respective period/year after taking into consideration the dilutive effect of convertible bonds. 1 The results for the financial period ended 30 June 2019 is for a period of fifteen (15) months. 2 The results for the continuing operations for the financial period ended 30 June 2019 and financial year ended 31 March 2018 excludes the Transport Solutions segment as it was deconsolidated as at 30 June 2019. 3 The results for the continuing operations for the financial years ended 31 March 2017, 31 March 2016 and 31 March 2015 includes the Transport Solutions segment. 2 Scomi Group Bhd Key Financial Highlights Turnover (RM Million) 20191 643.5 Total Assets 15 Months (RM Million) 20181 12 Months (Restated) 614.0 826 20172 2018 : 2,045 826.9 12 Months 2 2016 1,383.3 12 Months 2 2015 1,798.6 12 Months Shareholder’s (Loss)/Profit Before Tax (RM Million) Fund (RM Million) 20191 (243.5) 15 Months (24) 2018 : 362 20181 (219.4) 12 Months (Restated) 20172 (148.4) 12 Months 20162 12 Months 25.8 20152 12 Months 103.9 Net Tangible Assets (RM Million) (Loss)/Profit attributed to owners of the Company (127) (RM Million) 2018 : 85 20191 (396.1) 15 Months 20181 (250.0) 12 Months 20172 (107.4) 12 Months Basic Loss 20162 per share 12 Months 22.5 (sen) 20152 44.3 12 Months (36.22) 2018 : (22.88) 1 The results for the continuing operations for the financial period ended 30 June 2019 and financial year ended 31 March 2018 excludes the Transport Solutions segment as it was deconsolidated as at 30 June 2019. 2 The results for the continuing operations for the financial years ended 31 March 2017, 31 March 2016 and 31 March 2015 includes the Transport Solutions segment. Annual Report 2019 3 Corporate Structure as at 25 October 2019 SCOMI GROUP BHD1 65.65%2 Scomi Oiltools Scomi International Bermuda Limited Private Limited Scomi Energy (Bermuda) (Singapore) Services Bhd1 51% 49% Scomi Oiltools Scomi Oiltools Scomi Solutions 50% Overseas (M) (Europe) Ltd Sdn Bhd Gemini Sprint Emerald Transenergy Limited (Scotland) Sdn Bhd Logistics Shipping Pte Ltd (Mauritius) Sdn Bhd (Labuan) 51% 13.84% KMC Oiltools Scomi Oiltools Inc Scomi Ecosolve Algerie EURL (Texas, USA) Limited Trans Marineco Southern Petroleum (Algeria) (BVI) Advantage Limited Transportation Joint Sdn Bhd (Labuan) Stock Company (Vietnam) 48% 4% Scomi Oiltools Oilfield Services de Scomi Precision Scomi Marine Scomi D & P Scomi KMC Egypt SAE3,4 Mexico S de RL de Engineering Sdn Bhd Services Pte Ltd Sdn Bhd Sdn Bhd (Egypt) CV5* (Singapore) (Mexico) 49% 30% Scomi Oiltools de Scomi Chemicals King Bridge Ophir Mexico S de RL de Sdn Bhd Enterprises Production Scomi Oiltools CV5* Limited (BVI) Sdn Bhd (Thailand) Ltd7 (Mexico) (Thailand) 80.54% Scomi OBM 95% Terminal Sdn Bhd PT Rig Tenders Scomi Sosma Indonesia Tbk6 Sdn Bhd PT Scomi Oiltools (Indonesia) (Indonesia) Global Learning 95% and Development Rig Tenders Sdn Bhd Marine Pte Ltd PT Inti Jatam (Singapore) Pura 70% 50% (Indonesia) Scomi Energy Rig Tenders Sosma (B) Sdn Scomi Oiltools Sdn Bhd Oshore Pte Ltd Bhd* (RUS) LLC (Singapore) (Brunei) (Russia) Scomi Enviro Sdn Bhd CH Ship Management 95% Pte Ltd PT Multi Jaya 51% (Singapore) Persada 95% (Indonesia) Scomi SGSB Sdn Bhd Grundtvig PT Batuah Abadi Marine Pte Ltd Lines 30% (Singapore) (Indonesia) Strong Elegance Sdn Bhd CH Logistics Pte Ltd (Singapore) 4 Scomi Group Bhd 100% Scomi Engineering Bhd12 50% 70% Transenergy Scomi Oilfield Scomi Argentina Scomi Transit Scomi Transit Shipping Limited Sociedad Projects Brazil Projects Sdn Bhd Management (Bermuda) Anonima Sdn Bhd Sdn Bhd (Argentina) 49% Scomi Oiltools Scomi Oiltools KMCOB Capital Midgard Oilfield Urban Transit Scomi Transit Sdn Bhd Pty Ltd Berhad Services Ltd Servicos Do Projects Brazil (Australia) (Cayman) Brasil LTDA9 (Sao Paulo) (Brazil) Sdn Bhd12 50% 25% 51% Scomi Platinum Global Oilfield Scomi Oiltools Scomi Oiltools Scomi Urban Transit Sdn Bhd Products Oman LLC (Cayman) Ltd Transportation Private Limited10 Sdn Bhd (Oman) (Cayman Islands) Systems Sdn Bhd (India) 50% 80% Scomi Oiltools Scomi Vibratherm Scomi Oiltools Scomi Rail Quark Fabricação De (S) Pte Ltd Equipment Inc. Limited (Africa) Limited Bhd11 Equipamentos Ferroviårios (Singapore) (Texas, USA) (England & Wales) (Cayman Islands) E Serviços De Engenharia LTDA (Brazil) 60% KMC Oiltools KMC Oiltools BV* Wasco Oil Service India Pte Ltd8 (Netherlands) Company Nigeria Scomi Coach Scomi Special Sdn Bhd Vehicles (India) Limited 11 (Nigeria) Sdn Bhd Scomi Coach Marketing Scomi Trading Sdn Bhd Sdn Bhd Key: Energy Services Division Oilfield Services (Western) Division Transport Solutions Division 1. Listed on the Bursa Malaysia Securities Berhad (Kuala Lumpur Stock Exchange). Notes: 2. Includes 0.01% held by Scomi Energy Sdn Bhd. * Except as otherwise expressly stated, all companies in 3 Scomi Oiltools Bermuda Limited holds on trust for Scomi Oilfield Limited pursuant this corporate structure are incorporated in Malaysia. to a trust deed dated 8 March 2013. * Except as otherwise expressly stated, all companies in 4. Includes 1 share each held by Scomi Oiltools Ltd and Scomi Oiltools (Cayman) Ltd. this corporate structure are wholly owned by their 5. Includes 1 share held by an individual. respective holding companies. 6. Listed on the Indonesia Stock Exchange. 7. Includes 1 Class A share each held by Scomi Oiltools Sdn Bhd and Scomi Oiltools (Cayman) Ltd. 8. Includes 1 share held by Scomi Oilfield Limited. 9. Includes 1 quota (similar to share in other jurisdictions) held by Scomi Rail Bhd. 10. Includes 0.0004% held by Scomi Rail Bhd. 11. In Winding-Up. 12. In Judicial Management. Annual Report 2019 5 Corporate Statement With a presence in 19 countries, the We aim to realise potential for our Scomi group of companies is a global stakeholders. technology enterprise in the energy and logistics industries. Our customers: We will develop and offer customers innovative and competitive products and services that help them grow their business. We are a global technology enterprise. Our global reach, capabilities and talent provide us Our shareholders: with the necessary resources to develop and own new technology in all areas of our business. We are committed to providing long-term superior returns to our shareholders. We focus on Energy & Logistics. Our people: All our businesses are focused on the Energy and Logistics sectors with the ability to compete globally. All of us in the We aim to provide our employees with Scomi family should remember that any new initiatives developmental opportunities so they can we undertake will focus on these areas of business. succeed on personal and professional levels. We provide innovative solutions. Our suppliers: We innovate to respond to an evolving environment. We will treat our suppliers as our partners in the Our products and operations meet today’s needs mutual interest of business growth. while anticipating tomorrow’s. We are committed to developing competitive and innovative solutions to create efficiency, add value and grow with our customers Our society / environment: to shape our future. As a good corporate citizen, we will give back to the communities we operate in, worldwide.