Excelpoint Technology : Publishes 2021 Annual Report

A N N U A L R E P O R T 2 0 2 1

EXCELPOINT TECHNOLOGY LTD.	01
ANNUAL REPORT 2021

Table of Contents

01	08
CORPORATE PROFILE	BOARD OF DIRECTORS
02	11
LETTER TO SHAREHOLDERS	KEY MANAGEMENT
04	12
OPERATIONS REVIEW	BUSINESS PRESENCE
06	14
FINANCIAL HIGHLIGHTS	CORPORATE STRUCTURE
07	15
FINANCIAL REVIEW	CORPORATE INFORMATION

corporate profile

ABOUT EXCELPOINT TECHNOLOGY LTD.

(Company Registration No. 200103280C)

Excelpoint Technology Ltd. (the "Company") and its subsidiaries ("Excelpoint" or the "Group") are one of the leading regional business-to-business platforms providing quality electronic components, engineering design services and supply chain management to original equipment manufacturers, original design manufacturers and electronics manufacturing services in the Asia Pacific region. Excelpoint Technology Ltd. has been recognised in the top 25 Global Electronics Distributors and top Global Distributors lists by EBN, an online community for global supply chain professionals and EPSNews, a US-based information and data portal and resource centre for electronics and supply industries.

Excelpoint works closely with its principals to create innovative solutions to complement its customers' products and solutions. Aimed at improving operational efficiency and cost competitiveness, it has research and development ("R&D") centres in Singapore, China and Vietnam helmed by a team of professional engineers.

Established in 1987 and headquartered in Singapore, Excelpoint has more than 700 employees.

OUR POSITIONING

As a value-added partner to our principals and customers, we aim to bridge the electronics technology value chain closer together as a total solutions and service provider.

We create new value propositions for our principals and customers through R&D, bringing products to market in the shortest time possible.

We believe in creating a positive working relationship with our stakeholders and building tomorrow's future together.

02 EXCELPOINT TECHNOLOGY LTD.

ANNUAL REPORT 2021

letter to shareholders

"2021 has been an exceptional year of growth and progress for Excelpoint, and I thank our team for the hard work and dedication. Our strong fundamentals, value-added demand generation and clear focus on engineering expertise will remain the key to reinforcing our established market positioning."

DEAR SHAREHOLDERS,

On behalf of our Board of Directors (the "Board"), I am pleased to provide this Annual Report of the Group's performance for FY2021.

SETTING THE YEAR IN CONTEXT

As we entered into 2021, the COVID-19 pandemic continued to create uncertainties in the macroeconomic environment alongside geopolitical tensions. We see the pandemic leaving profound impact around the world causing disruptions with global death toll rising constantly. Even though vaccination programmes were underway in many nations, COVID-19 resurgence and the emergence of new variants have hampered the path to economic recovery. Against this backdrop, the semiconductor industry stayed robust with accelerated technology adoption, fuelling strong demand for electronic goods in numerous segments that we, at Excelpoint, play an important role enabling. With the wisdom of hindsight, we were much more adept at being agile and nimble in the new normal.

1. have been watchful of headwinds and taken pre-emptive measures to protect the health and safety of our employees. I am heartened to say that while the prolonged pandemic has put ou business through another round of rigorous tests, we have emerged stronger from it and delivered a strong set of results to our shareholders.

Th global chip shortage gave our business a clear advantage, bu it was our strong fundamentals on which we have built ou business upon including the strong trusted relationships we have built with our principals and partners that once again reinforced our established market positioning known for our

REVENUE UP BY

44.2%

TO US$1.6B

NET PROFIT ROSETO

US$24.5M

Proposalof an

ordinary dividendof

4.0Singapore cents

per share and a special

dividend of4.8

Singapore cents

pershare

EXCELPOINT TECHNOLOGY LTD.	03
ANNUAL REPORT 2021

letter to shareholders

strength in demand generation and engineering capabilities. These vital building blocks, together with our dedicated team and well-executed operational planning have enabled our Group to capture new opportunities arising from the increase in demand. The impact of the macroeconomic environment will always exist, but I believe that as long as we continue to focus on our core capabilities and enhance our positioning, we will see sustained growth for the business.

FINANCIAL SCORECARD

2021 has been an exceptional year of growth and progress for Excelpoint. Amidst one of the most challenging periods, Excelpoint as a group has delivered record revenue of US$1.6 billion and a net profit after tax of US$24.5 million, with a strongest balance sheet reported to date. Overall, our sales across all our markets have surged above our expectations and have resulted in better profit margins. Our Hong Kong Business Unit reported a revenue of US$0.9 billion and our Singapore Business Unit reported a revenue of US$0.7 billion.

In view of our 2021 results, the Board proposes an ordinary dividend of 4.0 Singapore cents per share and a special dividend of 4.8 Singapore cents per share, subject to your approval at the forthcoming Annual General Meeting.

MARKETS AND OUTLOOK

China is one of our leading markets and their resilience has exemplified their positioning as a manufacturing powerhouse. With the China government implementing a slew of new policies and stimulus to develop next generation infrastructure across the telecommunication networks, advanced manufacturing, data centres and artificial intelligence ("AI"), the China market is set for the next wave of growth. Through its "Made in China 2025" policy to bolster domestic production, we expect to see new opportunities arising in Industrial Robotics, 5G & Wireless Communications, Smart Home and Electric Vehicles ("EV") segments. The Renewable Energy Technologies space is nascent following China's recent declaration to achieve carbon neutrality by 2060, giving rise to emerging technologies that will contribute to our growth.

Vietnam's semiconductor industry has matured over the years and we see tremendous growth potential arising from manufacturing shifts, as well as more focus on infrastructure projects and developments. Given Vietnam's government strong push to drive technology adoption and economic transformation, we have added new growth engines to capture new opportunities in AI, Internet of Things ("IoT"), EV and Urban Development.

We continue to deepen our footprints in India as it remains one of our key emerging markets despite its slow recovery from the

impact of COVID-19. We foresee demand traction to resume with India's various infrastructural projects underway and its strong push to boost domestic production in its electronics manufacturing sector.

EMERGING STRONGER

At Excelpoint, we have weathered another year of uncertainty from a position of strength and have proven resilient. Innovation is vital for sustainability and we need to ensure we stay relevant to market needs. We must continue to embed ourselves with partners and collaborate with them in order to transform and emerge stronger.

The prolonged pandemic has also emphasised the importance of strengthening our engineering expertise and its critical role in our long-term growth. As we expand in this area developing more technology solutions alongside our partners and investing in people and capabilities, we expect our efforts in value-adding to our businesses will continue to bear fruits.

Through the PlanetSpark Innovation Centre, we continue to make strategic investments into innovation and new technologies. We have seen traction coming in from our portfolio companies and we are also seeking out new avenues to capture new business opportunities that would enable us to take on greater responsibilities when it comes to playing a role in the supply chain.

Our people are our greatest assets and we are dedicated to investing in them. We take our duty of care to them very seriously, focusing on both their professional and personal fulfillment. Progressively, we have enriched our incentive reward scheme that would motivate them to upskill and grow both professionally and individually.

IN APPRECIATION

On behalf of the Excelpoint team, I would like to express my gratitude to our principals, customers and partners for their unwavering support and trust in me and our Management team. On behalf of the Board, I would like to thank our Directors for their continued dedication and guidance to the Group. To our shareholders and my team, I wish to thank you for your steadfast support and standing by Excelpoint over the last year and for many years to come. Having closed FY2021 on a strong note, let us enter the new year with positivity and renewed vigour that would bring Excelpoint to greater heights.

Yours sincerely,

Albert Phuay Yong Hen

Chairman and Group Chief Executive Officer