Financial Announcements

• Revenue declined 4% from $73.8 million to $71.0 million
• Net profit After Tax rose 163% from $1.9 million to $5.1 million
• Operating activities generated $18.8 million cash flow
• Cash balance stood at $40.1 million

Main board listed Teckwah Industrial Corporation Limited ("Teckwah" or "the Group") today announced an approximately 163 % increase in net profit after tax in spite of decline in revenue for the six months ended 30 June 2009.

The Group's net profit after tax rose to $5.13 million from $1.95 million registered over the same period a year ago. The higher profitability is mainly attributable to the swift actions by the management in cost management and process improvement resulting in better efficiencies and lower operating cost. The top and senior management took the lead in salary cut of 10% and 5% respectively, and salary freeze for the rest of the staff at the beginning of 2009. Better inventory management, lower raw material and transportation prices and a favorable foreign exchange rate have collectively contributed significantly to the Group's performance. Changes in the work shift pattern, which resulted in lower utility and labor costs, have also helped the Group's performance.

Group's turnover stood at $ 71 million, representing a decline of 3.8% over the turnover of $73.8 million reported in H1 FY2008. The Print Related Business registered a 10% reduction in revenue from $61.3 million to $55.1 million due mainly to the completion of a major project in China in the third quarter of FY2008, as well as weaker demand from customers in Australia and Indonesia. The Non-Print Related Business registered an increase in revenue by 27% from $12.4 million to $15.7 million as a result of new contributions from projects secured in the second half of FY2008.

By business segments, the Print-related business remains as its main revenue contributor accounted for 77.7% of the Group's turnover. The balance of approximately 22.3% comprises contribution from its Non-print business. By geography, the Singapore operations continue to be the main revenue contributor accounting for 58.9% of the Group's total revenue. The China operations are the second largest contributor at 26.1%.

Strong operating profit together with efforts in managing inventory, receivable and payable, have enabled the Group to generate a strong cashflow from operations of $18.8 million. As of June 30 2009, the Group maintains healthy cash balance of approximately $40.1 million. The Group's gearing remains low at 0.01 times.

"We saw strong team spirit among all staff who worked together to overcome the difficult time. Although we have delivered a set of better than expected results, it is not the time to celebrate yet because there are still uncertainties ahead of us. The cost management measures and process improvement initiatives that we have put in place have to be continued and further enhanced.

Although our Print related business, being a core business for Teckwah, will continue to play an important role, the development of our Non-print business is also encouraging," said Mr. Thomas Chua, Executive Chairman and Managing Director of Teckwah. "With our strong balance sheet, we will capitalize on current lower prices in this downturn to selectively upgrade our facilities and continue to look for business acquisitions that will support the future growth of the Group."

Barring any unforeseen circumstances, the Group will deliver a higher profit for this financial year as compared to FY 2008. The Board recommends an interim dividend of 0.8 cents per share to reward shareholders for their loyalty and supports all these years.

• Revenue totalled $158.0 million
• Net profit after tax attributable to shareholders totalled $4.2 million
• Group has strong cash flow and healthy balance sheet
• Recommends final dividend of 0.8 cents per share

Main board listed Teckwah Industrial Corporation Limited ("Teckwah" or "the Group") today announced revenues of $158.0 million and net profit after tax attributable to shareholders of $4.2 million for the financial year ended 31 December 2008 ("FY08").

To reward shareholders, the Board recommends a final dividend of 0.8 cents per share, subject to the approval of the shareholders at the forthcoming Annual General Meeting.

At the close of FY08, the Group has $28.1 million in cash and cash equivalents and operating activities generated positive cash inflows amounting to $12.0 million. The Group's balance sheet remains healthy and with its low reliance on bank borrowings, it continues to operate with a very low gearing of 0.02 times. Prudent management at Teckwah has also ensured that capital expenditures are contained and investments decisions are carefully evaluated. The Group is well positioned to weather the current economic crisis.

Similar to trends in previous years, the Group's performance in the second half of the year was better than that of the first six months of FY08. However, business for the full financial year was weaker as revenue remained relatively flat compared to the previous financial year ("FY07"). The Group's profit margin was also lower due to high energy and raw materials costs during the year. A $1.1 million additional and final provision for impairment of goodwill for its Australia operation which turned in weak performance in FY08 has also impacted the Group's bottomline. Both the Print-related and Non-print related operations reported lower profit.

Geographically, Singapore continues to be the key contributor for Teckwah. The China market also turned in encouraging performance, in particular from its flexible packaging business. This particular business segment, which caters largely to the food and beverage industry, is fuelled largely by domestic consumer demand in China.

Total operating expenses amounted to $39.5 million. The increase in operating expenses is primarily due to the impact of the full year rental of the Group's additional floor space in TIC Tech Centre building. The year also saw lower foreign exchanges losses, which amounted to $0.5 million compared to $0.8million reported in the previous financial year.

Going forward, the Group expects that the business environment will become increasingly difficult in view of the global financial crisis and poor consumer confidence. There will be weakening demand from global IT's companies whose customers worldwide are expected to cut IT spendings. Within the organisation, it has taken steps to reduce management's salaries and freeze staff's wages for the year and will continue to look for ways to improve its operating and cost efficiencies. The recent economic stimulus package from the Singapore government, including the job credit scheme, will benefit the Group in the new financial year.

Notwithstanding the tough economic outlook, the Group is committed to continually improve and upgrade the quality of its human capital. It will therefore continue to focus and invest in employee training across all levels. This corresponds with Teckwah’s strategy to transform and orientate itself into a service-focused organisation.

Commenting on the outlook for Teckwah into the new financial year, Mr Thomas Chua, Chairman and Managing Director said: “In line with our aim to continually strengthen the structure of Teckwah, we will be looking to improve our efficiency and search for new areas of competencies that can enhance our current operations. At the same time, we are on the look out for strategic alliances or business acquisitions that are complementary to our business. We expect that these opportunities may emerge as the global economic consolidation continues into the rest of this year.”