Koon Holdings Ltd

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Corporate Profile

Extracted from Annual Report 2010

Koon began in 1975 as a small sole proprietorship transporting rocks and stones for major international construction companies. Capitalising on the construction boom in 1970s with its strong management team, Koon was able to ride on early successes to move up the value chain.

In 1979, Koon Construction and Transport Co., Pte Ltd ("KCTC") was incorporated and raised capital. With this boost in funds, it was able to increase manpower and equipment allowing it to collaborate more closely with international firms. This in turn allowed it to upgrade its technical expertise, particularly in the area of reclamation and related works.

In 1985, it went into a joint venture with a major marine engineering company, Zinkcon, to form Koon-Zinkcon, which specialised in the protection of reclaimed shorelines. Zinkcon is part of Royal Boskalis Westminster nv ("Boskalis"), a major international dredging and offshore engineering firm. The success of the joint venture, prompted the management to formalise arrangement and Koon-Zinkcon Pte Ltd ("KZ"), was incorporated in 1997. Whilst KCTC still owns 50% of KZ, it is now being managed by third-party professionals. Accordingly, it is treated as an investment with dividend contributions to KCTC.

Koon Holdings Limited ("Koon"), an investment holding company, was incorporated specifically for listing on the Australian Securities Exchange ("ASX") and Singapore Exchange Limited ("SGX"). KCTC is the main operating company of the Group.

Koon's construction business is enhanced by its plant and equipment rental division, which manages the leasing and rental of construction equipment.

Entire Construction Pte Ltd ("Entire Construction") was incorporated in 2008 to take on smaller construction projects.

Koon further broadened its range of business activities by moving upstream into precast products. It currently operates 3 yards in Singapore and Malaysia, allowing them to meet the growing demand for precast products across the island.

GROUP BUSINESS DIVISIONS

Construction Division

KCTC has grown significantly since 1977 and is now one of the largest domestic civil engineering, reclamation and shore protection specialists.

KCTC is registered under the A1 category in civil engineering and the B1 category in general building with the Building and Construction Authority ("BCA"). It is also certified in Integrated Management Systems covering Quality Management System (ISO 9001:2008), Environmental Management System (ISO 14001:2004) and Occupational Health and Safety Management System (OHSAS 18001:2007). In 2009, KCTC obtained the Bizsafe Partner Certification as well as the BCA Green & Gracious Builder Award.

KCTC operates as a main contractor on many of its projects. On larger scale projects, particularly those of reclamation, KCTC participates in joint ventures with other strategic partners with international reputation. This is mainly due to project requirement reasons, as few groups have all the required resources to secure and execute such projects alone.

During the last two decades, KCTC has successfully completed a list of reclamation projects, which have helped increase Singapore's land area by about twenty percent. These completed projects now form the new coastal lines of Singapore. They are at the NORTH - Punggol; SOUTH - Marina Bay, Tanjung Rhu, Sentosa Cove & Pasir Panjang; EAST - Changi and WEST - Jurong Island & Tuas View. Over the last couple of years, KCTC has also executed a high percentage of water, sewage and power projects. Amongst the more noticeable ones is the S$118 million Serangoon Reservoir project which we have recently completed. Our track record also includes the Bedok and Ulu Pandan Water Reclamation Plant Equalisation Basin projects.

Riding on the strong demand, infrastructure projects have become an important driver for KCTC. In recent years, we had completed works such as the Singapore Airshow, Joan Road Drainage, Construction Industries Park, Gardens by the Bay (Package 1) and Angsana Infrastructure. At the moment, we are executing Jurong Island 3B5 Drainage, Changi North Infrastructure and Changi East Infrastructure.

On top of that, we are also executing a marine infrastructure project in Changi. We have handled such projects for the past ten years or so, and have successfully completed close to half a dozen projects.

In early 2010, KCTC secured the US$160 million Sao Bien Seaport Project in Ho Chi Minh on a design and build basis. This Project marks our first foray overseas and is our largest contract secured.

Lastly, KCTC has also started on the Pulau Tekong Mangrove Biodiversity Project to restore existing mangroves and to protect the coastal line. Our accumulated experiences from the Wetlands and East Coast/Pasir Ris Park restoration has been vital in securing this Project.

Plant and Equipment Rental Division

Established in the year 1983, Entire Engineering is a wholly-owned subsidiary of Koon. It owns and manages the Group's plant and equipment such as cranes, trucks, grab dredgers and other construction equipment. Entire Engineering focuses on rental of plant and equipment for construction needs to both internal (i.e. Koon Group of companies) and external clients. It has a wide range of construction machinery including crawler cranes, excavators, lorry cranes, tipper trucks, vibratory soil compactors, wheel loaders and grab dredgers. Equipment handled consists of a variety of pumps, such as pabool pumps, electrical submersible pumps, diesel water pumps, and chemical treatment plants. In addition, it also provides land-based transportation services.

Precast Division

On March 25, 2010, the Group acquired a 75% equity interest in Econ Precast Pte Ltd (previously known as ECI Corporation Pte Ltd) ("Econ").

Econ is an approved precaster for Housing and Development Board ("HDB") projects with a Building and Construction Authority ("BCA") L6 grading for Precast Concrete Work and Basic Building Materials. This grading allows Econ to tender for public and private projects of an unlimited value. Econ's wide range of precast products can be found in a series of HDB developments and upgrading works, including at Punggol, Sengkang and Clementi.

Econ is beneficially entitled to the entire issued share capital of Econ Precast Sdn Bhd (previously known as ECI Berjaya Sdn. Bhd) ("EPSB").

EPSB was formed in May 2007 to expand Econ's precast production capacity due to the shortage of land in Singapore. With the completion of the acquisition of Econ, EPSB is now an indirect subsidiary of Koon.

To further strengthen our precast capabilities, the Group on August 27, 2010 completed its acquisition of Contech Precast Pte. Ltd. (formerly known as Construction Technology Pte Ltd) ("Contech"). With the acquisitions, we have become one of the largest precasters in Singapore in terms of capacity, resources and product range.

The acquisition of Contech, coupled with its purchase of Econ in March 2010, signify that the Group would own 2 of the 9 BCA L6 licenced precasters within Singapore. Today, Contech ranks as one of the most experienced and versatile precasters within Singapore. Contech has been involved in the precast industry since 1984 and has accumulated over 25 years of experience in supplying precast works for many local and overseas developers, contractors and government bodies. Its extensive customer base includes the HDB and the Land Transport Authority.

Contech produces a wide range of precast products, such as precast façade walls, tunnel segments, volumetric components, viaducts, slabs, prestressed planks, staircases, columns and beams. The addition of these production lines will effectively double Koon's precast capabilities with a net capacity increase of production volume by 50,000 cubic metres per annum.

The addition of precast work to the Group's core specialty of civil engineering works will open the doors to new opportunities and provide a more rounded service for our customer. Leveraging on our strong track record and extensive network, we are well-positioned to capitalise on the growing infrastructure and housing demand.

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