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Chairman's Statement
 
DEAR VALUED SHAREHOLDERS,

On behalf of the Board of Directors, it is my pleasure to present to you the Annual Report and Audited Financial Statemen of PeterLabs Holdings Berhad for the financial year ended 31 December 2015.

OVERVIEW

As the year past, I am proud that the Group was listed in ACE Market of Bursa Securities on 26 July 2011. Its principal trades are in the manufacturing, distribution and trading of health and nutrition products for animals which include animal feed additives, environment maintenance products, veterinary pharmaceuticals and biological products.

After years of challenges, the Group has set up another Fat Granular Spray plant at Klang in the 4th quarter of 2015. With an approximately total build up area of 28,320 sq.ft and land area of 43,738 sq.ft, the plant is targeted as a manufacturing and storage for animal feed additives under the in-house “OsmoFat” brand. The plant is currently undergoing machinery trials and is targeted to begin commercial production by 2nd quarter of 2016.

As the Group looks forward, we will continue investing in the new plant to expand its overseas market, targeting countries like China, Europe, and the Middle East to expand the business to new markets.

PERFORMANCE REVIEW

I am pleased to announce that the Group’s total revenue achieved by the financial year ended 2015 is RM 73.48 million, which represents a growth of 33.75% as compared with the financial year ended 2014 revenue of RM 54.94 million, an increase contributed by both domestic and export markets.

Coinciding with the higher revenue and as a result of continued cautious operational efficiency, we have managed to register a total profit before tax (“PBT”) of RM 5.16 million which represents an increase of RM 1.04 million as compared to the previous year, while the total profit after tax (“PAT”) is RM 3.48 million which represents an increase of RM 0.50 million.

However, due to the Ringgit depreciation, the advent of GST, as well as the capital and operation costs necessary for the new manufacturing plant in Klang, the gross profit percentage has decreased from 22.44% to 20.53% despite the significant increase in revenue.

Along with our ambition to continue to progress forward and venture into new horizons, the Group has penetrated into addition- al newly developed export countries – Brunei other than countries that the Group had ventured earlier such as Korea, Philip- pines, Singapore, Indonesia, Taiwan, Pakistan, Nepal, Bangladesh, and Thailand.

As the Group continues to achieve growth and progress, we will continue to focus on expanding and strengthening our core business to create a better economy of scale to our operation so as to place the Group in a more competitive position.

CORPORATE DEVELOPMENT

During the financial year, the Group has raised RM3.666 million via private placement which used to enhance our operation’s working capital to meet our robust increased in turnover.

DIVIDEND

On 28 January 2016, the Group declared an interim single tier dividend of 0.7sen per share which representing a payout ratio of 40.61% of PAT for the Group for the financial year ended 31 December 2015. The dividend was paid on 30 March 2016.

The Group did not recommend any final dividend for the financial year ended 31 December 2015.

PROSPECTS

As the Group moves forward into 2016, we will continue to keep a keen eye on our current projects and seeking out new opportunities to expand the business into both domestic and foreign markets. With the new plants, we look forward to developing and maintaining both our current and new markets.

In the future, the Group looks to development in expanding its range of biological products as well as to obtain Good Manufacturing Practice (“GMP”) accreditation to achieve higher quality standards for all our products. The Group will continue to look out for opportunities to expand its business in Malaysia and overseas.

CORPORATE SOCIAL RESPONSIBILITY

The Group believes that as an industry player, it is our role to provide continuous support to the society to maintain best business practices.

The Group has sponsored an undergraduate student on her overseas veterinary degree but also made contributions to assist the Penan people in East Malaysia, Sarawak to improve their quality of living on construction of their homes and facilities. The Penan peoples are the only nomadic people in Malaysia, who have lived in the rainforests in the remote parts of Sarawak for generations, roaming from one forest to another as hunters-gatherers.

In addition, the Group has also contributed to various local farmers associations, primary and secondary schools’ education funds and charity fairs. We hope to enhance the lives of the local community with our contribution.

At the same time, the Group has provided various training programmes for the employees to enhance and upgrade their work skills in the hopes to provide a more fulfilling working experience to our employees.

CORPORATE GOVERNANCE

It is of great importance for us to uphold transparency, accountability, and protection of our shareholders' interests. Thus, it is of great importance to us to practice the highest standards of corporate governance. Our statement regarding corporate governance can be found in our later pages.

DIRECTORATE

The Group welcomes the appointment of the Executive Director, Ms. Yap Siaw Peng who has been appointed to the Board on 1 March 2016.

APPRECIATION

I would like to extend my appreciation to the management and staffs for their commitment, dedication, contribution and loyalty towards the growth and continued success of the Group this past year.

I would also like to extend my appreciation to our shareholders, valued customers, business associates, bankers, suppli- ers, regulatory bodies for their continuous confidence and support, and will look forward to the continuous support in future ventures.

Dato' Hon Choon Kim
Independent Non-Executive Chairman



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