PENTAMASTER CORPORATION BERHAD ("PCB" or "COMPANY")

COMPANY NO.: 200201004644 (572307-U)

QUARTERLY REPORT ON UNAUDITED CONSOLIDATED RESULTS

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER

COMPREHENSIVE INCOME FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

Individual Quarter Cumulative Year

3 Months Ended Financial Period Ended
31/12/2022 31/12/2021 31/12/2022 31/12/2021
RM'000 RM'000 RM'000 RM'000

Revenue 147,659 122,491 600,587 508,389

Cost of goods sold (102,926) (83,919) (417,368) (355,785)

Gross profit 44,733 38,572 183,219 152,604

Other income 20,301 5,541 13,954 19,195

Distribution costs (2,177) (1,135) (9,966) (10,623)
Administrative expenses (29,630) (9,085) (57,863) (41,097)
Net reversal of/(provision for) expected credit loss
("ECL") allowance on trade receivables 4,492 (1,482) 4,798 1,201
Other operating expenses 4 (69) (336) (236)

Operating profit 37,723 32,342 133,806 121,044

Finance costs (27) (22) (87) (92)

Share of loss of associates (771) (524) (1,636) (1,485)

Profit before taxation 36,925 31,796 132,083 119,467

Taxation (980) (950) (1,544) (3,830)

Profit for the financial period/year 35,945 30,846 130,539 115,637

Total other comprehensive income, net of tax:

Item that will be reclassified subsequently to
profit or loss
Foreign currency translation of foreign operations (81) 25 (136) 56

Total comprehensive income for the financial

period/year 35,864 30,871 130,403 115,693

Profit for the financial period/year, attributable to:

Owners of the Company 22,743 19,890 82,418 72,911
Non-controlling interests 13,202 10,956 48,121 42,726

35,945 30,846 130,539 115,637

Total comprehensive income for

the financial period/year, attributable to:
Owners of the Company 22,691 19,906 82,331 72,947
Non-controlling interests 13,173 10,965 48,072 42,746
35,864 30,871 130,403 115,693

Earnings per share attributable to

owners of the Company (Sen):
- Basic/Diluted 3.20 2.79 11.58 10.24

The unaudited condensed consolidated statement of profit or loss should be read in conjunction with the audited financial statements
for the financial year ended 31 December 2021.
PENTAMASTER CORPORATION BERHAD ("PCB" or "COMPANY")
COMPANY NO.: 200201004644 (572307-U)
QUARTERLY REPORT ON UNAUDITED CONSOLIDATED RESULTS

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2022

Unaudited Audited
As at As at
31/12/2022 31/12/2021
RM'000 RM'000
ASSETS
Non-current assets
Property, plant and equipment 170,009 135,232
Investment properties 22,805 19,467
Goodwill 4,495 4,495
Intangible assets 40,682 41,475
Investment in associates 20,070 21,706
Other investments 6,117 -
Other receivables, deposits and prepayments - 28,225
Deferred tax assets - 221
264,178 250,821

Current assets
Inventories 170,934 72,006
Trade receivables 237,926 165,312
Other receivables, deposits and prepayments 60,407 16,065
Derivative financial assets 489 1,246
Other investments 219 374
Tax recoverable 2,791 449
Cash and cash equivalents 421,225 478,241
893,991 733,693

TOTAL ASSETS 1,158,169 984,514

EQUITY AND LIABILITIES

Share capital 79,303 79,303

Reserves 547,484 486,452
626,787 565,755
Non-controlling interests 265,953 229,864
Total Equity 892,740 795,619

LIABILITIES
Non-current liabilities
Borrowings - 2,140
Deferred tax liabilities 3,762 4,299
3,762 6,439
Current liabilities
Trade payables 121,528 77,560
Other payables, accruals and provision 31,799 39,375
Contract liabilities 100,581 64,152
Borrowings - 425
Derivative financial liabilities 6,847 -
Tax payable 912 944
261,667 182,456
Total Liabilities 265,429 188,895

TOTAL EQUITY AND LIABILITIES 1,158,169 984,514

The unaudited condensed consolidated statement of financial position as at 31 December 2022 should be read in conjunction with
the audited financial statements for the financial year ended 31 December 2021.
PENTAMASTER CORPORATION BERHAD ("PCB" or "COMPANY")
COMPANY NO.: 200201004644 (572307-U)
QUARTERLY REPORT ON UNAUDITED CONSOLIDATED RESULTS

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

Attributable to Owners of the Company

Non-distributable Distributable
Shares held for Foreign
Employee Currency Non-
Share Treasury Share Scheme ESS Translation Retained controlling Total
Capital Shares (ESS) Reserve Reserve Profits Total Interests Equity

RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000

As at 1 January 2022 (Audited) 79,303 - (4,269) 2,266 36 488,419 565,755 229,864 795,619

Profit for the financial year - - - - - 82,418 82,418 48,121 130,539

Other comprehensive income for the financial year - - - - (87) - (87) (49) (136)
Total comprehensive income for the financial year - - - - (87) 82,418 82,331 48,072 130,403

Transactions with owners:

Dividend paid - - - - - (14,227) (14,227) - (14,227)
Dividend paid to non-controlling interest - - - - - - - (9,712) (9,712)
Effect of changes in shareholding - - - - - 2,271 2,271 (2,271) -
Equity settled ESS expenses - - - 7,574 - - 7,574 - 7,574
ESS vested - - 6,656 (6,134) - (522) - - -
Purchase of shares held for ESS - - (13,865) - - - (13,865) - (13,865)
Purchase of treasury shares - (3,052) - - - - (3,052) - (3,052)
Total transactions with owners of the Company - (3,052) (7,209) 1,440 - (12,478) (21,299) (11,983) (33,282)

As at 31 December 2022 (Unaudited) 79,303 (3,052) (11,478) 3,706 (51) 558,359 626,787 265,953 892,740

Attributable to Owners of the Company

Non-distributable Distributable
Shares held for Foreign
Employee Currency Non-
Share Treasury Share Scheme ESS Translation Retained controlling Total
Capital Shares (ESS) Reserve Reserve Profits Total Interests Equity

RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000

As at 1 January 2021 (Audited) 79,303 - (5,849) - - 434,972 508,426 196,878 705,304

-
Profit for the financial year - - - - - 72,911 72,911 42,726 115,637
Other comprehensive income for the financial year - - - - 36 - 36 20 56
Total comprehensive income for the financial year - - - - 36 72,911 72,947 42,746 115,693

Transactions with owners:

Dividend paid - - - - - (10,685) (10,685) - (10,685)
Dividend paid to non-controlling interest - - - - - - - (6,273) (6,273)
Effect of changes in shareholding - - - - - (8,329) (8,329) (3,487) (11,816)
Equity settled ESS expenses - - - 5,597 - - 5,597 - 5,597
ESS vested - - 3,781 (3,331) - (450) - - -
Purchase of shares held for ESS - - (2,201) - - - (2,201) - (2,201)
Total transactions with owners of the Company - - 1,580 2,266 - (19,464) (15,618) (9,760) (25,378)
-
As at 31 December 2021 (Audited) 79,303 - (4,269) 2,266 36 488,419 565,755 229,864 795,619

The unaudited condensed consolidated statement of changes in equity for the financial year ended 31 December 2022 should be read in conjunction with the audited financial statements for the financial year ended 31
December 2021.
PENTAMASTER CORPORATION BERHAD ("PCB" or "COMPANY")
COMPANY NO.: 200201004644 (572307-U)
QUARTERLY REPORT ON UNAUDITED CONSOLIDATED RESULTS

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

12 Months 12 Months
ended ended
31/12/2022 31/12/2021
(Unaudited) (Audited)
RM'000 RM'000
Cash flows from operating activities

Profit before taxation 132,083 119,467

Adjustments for:
Amortisation of intangible assets 4,919 5,095
Deferred income released - (1,746)
Depreciation 5,762 4,200
(Gain)/Loss on disposal of property, plant and equipment (58) 1,667
ECL allowance on trade receivables 1,910 2,025
Reversal of ECL allowance on trade receivables (6,708) (3,226)
Bad debts written off - 383
Waiver of other payable (4,780) -
Interest expense 87 92
Interest income (7,524) (6,834)
Loss from changes in fair value of foreign currency
forward contracts 7,604 2,090
Gain on disposal of interest in an associate - (641)
Gain on disposal of other investments (15) (101)
Property, plant & equipment written off - 1
Loss/(Gain) from changes in fair value of other investments 16 (22)
Inventory written down - addition 245 362
Inventory written down - reversal (102) (344)
Provision of warranty - current year 1,515 1,256
Provision of warranty - reversal (1,256) (647)
Share of loss of associates 1,636 1,485
ESS expenses 7,574 5,597
Unrealised loss/(gain) on foreign exchange 904 (4,350)

Operating profit before working capital changes 143,812 125,809

Increase in inventories (99,071) (38,188)

Increase in receivables (87,007) (24,830)
Increase in payables 41,976 14,513
Increase in contract liabilities 36,429 48,681

Cash generated from operations 36,139 125,985

Interest paid (87) (92)

Tax paid (4,486) (4,492)
Tax refunded 246 881
Net cash generated from operating activities 31,812 122,282

Cash flows from investing activities

Acquisition of other investments (6,244) (741)

Acquisition of interest of non-controlling interest in a subsidiary - (11,816)
Interest received 7,524 6,834
Investment in an associate - (33)
Investment in redeemable convertible preference shares of an associate - (15,000)
Proceeds from disposal of other investments 292 1,166
Proceeds from disposal of sale of associate - 66
Proceeds from disposal of property, plant and equipment 58 -
Purchase of intangible assets (4,126) (5,859)
Purchase of investment property (3,582) -
Purchase of property, plant and equipment (40,611) (37,587)
Net cash used in investing activities (46,689) (62,970)
PENTAMASTER CORPORATION BERHAD ("PCB" or "COMPANY")
COMPANY NO.: 200201004644 (572307-U)
QUARTERLY REPORT ON UNAUDITED CONSOLIDATED RESULTS

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (CONT'D)

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

12 Months 12 Months
ended ended
31/12/2022 31/12/2021
(Unaudited) (Audited)
RM'000 RM'000
Cash flows from financing activities

Repayment of term loan (2,565) (411)

Dividend paid (14,227) (10,685)
Dividend paid to non-controlling interest of a subsidiary (9,712) (6,274)
Purchase of shares in a subsidiary for ESS (13,865) (2,201)
Purchase of treasury shares (3,052) -
Net cash used in financing activities (43,421) (19,571)

Net (decrease)/increase in cash and cash equivalents (58,298) 39,741

Effect of foreign exchange rate changes 1,282 1,179
Cash and cash equivalents at beginning 478,241 437,321
Cash and cash equivalents at end 421,225 478,241

The unaudited condensed consolidated statement of cash flows for the financial year ended 31 December 2022 should be
read in conjunction with the audited financial statements for the financial year ended 31 December 2021.
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

1 Basis of Preparation

The interim financial report is unaudited and has been prepared in accordance with MFRS
134: Interim Financial Reporting issued by the Malaysian Accounting Standards Board
(“MASB”) and paragraph 9.22 of the Main Market Listing Requirements of Bursa
Malaysia Securities Berhad (“Bursa Malaysia”). The figures for the cumulative financial
period in the current quarter to 31 December 2022 have not been audited.

The interim financial report should be read in conjunction with the audited financial
statements of the Company and its subsidiaries (“Group”) for the year ended 31
December 2021.

The accounting policies and methods of computation adopted for the interim financial
report are consistent with those adopted in the audited financial statements for the year
ended 31 December 2021, except for the adoption of the following Malaysian Financial
Reporting Standards (“MFRS”) that are effective for annual period beginning on or after
1 January 2022:
Amendment to MFRS 16 Leases: Covid-19 - Related Rent Concessions beyond 30 June 2021
Amendments to MFRS 3 Business Combinations: Reference to the Conceptual Framework
Amendments to MFRS 116 Property, Plant and Equipment: Property, Plant and Equipment -
Proceeds before Intended Use
Amendments to MFRS 137 Provisions, Contingent Liabilities and Contingent Assets: Onerous
Contracts – Cost of Fulfilling a Contract
Annual Improvements to MFRS Standards 2018 – 2020

The adoption of the above MFRSs did not result in any significant changes in the
accounting policies of the Group.

As at the date of this announcement, the Group has not applied the following MFRSs
which have been issued as at the end of reporting period but are not yet effective: -

MFRS 17 Insurance Contracts1

Amendments to MFRS 4 Insurance Contracts – Extension of the Temporary Exemption from
Applying MFRS 9 Financial Instruments1
Amendments to MFRS 17 Insurance Contracts1
Amendments to MFRS 17 Insurance Contracts: Initial application of MFRS 17 and MFRS 9 -
Comparative Information1
Amendments to MFRS 10 Consolidated Financial Statements and MFRS 128 Investments in
Associates and Joint Ventures - Sale or Contribution of Assets between an Investor and its
Associate or Joint Venture3
Amendments to MFRS 16 Leases: Lease Liability in a Sale and Leaseback2
Amendments to MFRS 101 Presentation of Financial Statements: Classification of Liabilities as
Current or Non-Current1
Amendments to MFRS 101 Presentation of Financial Statements: Disclosure of Accounting
Policies1
Amendments to MFRS 101 Presentation of Financial Statements: Non-current Liabilities with
Covenants2
Amendments to MFRS 108 Accounting Policies, Changes in Accounting Estimates and Errors -
Definition of Accounting Estimates1
Amendments to MFRS 112 Income Taxes: Deferred Tax related to Assets and Liabilities arising
from a Single Transaction1

1 Effective for annual periods beginning on or after 1 January 2023

2 Effective for annual periods beginning on or after 1 January 2024
3 Effective date not yet determined

The Group is in the process of making an assessment of the impact of these new and
amended IFRSs upon initial application and anticipates that such application will have
no material impact on the results and financial position of the Group.

1
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

2 Audit Report of Preceding Annual Financial Statements

The audit report of the Group’s most recent annual audited financial statements for the
year ended 31 December 2021 was not subject to any qualification.

3 Seasonal and Cyclical Factors

The Group sells its products and services to customers from various sub-sectors of the
semiconductor and manufacturing industries. As such, the Group’s performance will, to
a certain extent, depend on the outlook and cyclical nature of the semiconductor and
manufacturing industries.

4 Unusual Items

There were no unusual items affecting assets, liabilities, equity, net income or cash flows
during the financial period under review.

5 Changes in Estimates

There were no changes in estimates of amounts reported in prior financial years that have
a material effect in the current quarter.

6 Valuations of Property, Plant and Equipment

The carrying values of property, plant and equipment have been brought forward, without
amendment from the previous audited financial statements.

7 Changes in Share Capital and Debt

There were no issuances, cancellations, repurchases and repayments of debt and equity
securities for the financial period under review.

8 Contingent Liabilities

There were no contingent liabilities for the Group since 31 December 2021 up to 31
December 2022.

9 Capital Commitments

Amount
(RM’000)

Contracted but not provided for

- Property, plant and equipment 53,974

Authorised but not contracted for

- Property, plant and equipment 135,923

2
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

10 Related Party Transactions

There was no related party transactions for the Group since 31 December 2021 up to 31
December 2022.

11 Segmental Information

The Group has three operating segments which are involved in different activities and are
managed by segment managers who report directly to the Group’s executive directors.
The operating segments are as follows:

(i) Automated test equipment (“ATE”): Designing, development and

manufacturing of standard and non-
standard automated equipment;

(ii) Factory automation solutions (“FAS”): Designing, development and installation

of integrated factory automation
solutions;

(iii) Smart control solution system: Project management, smart building

solutions and trading of materials.

Inter-segment transactions have been accounted for on a basis that is consistent with the
Group’s accounting policies. No other operating segments have been aggregated to form
the above operating segments. Investment holding and other activities are not considered
as operating segment and the related financial information has been included under
“Adjustment”.

3
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

Results for the financial year ended 31 December 2022

Automated Factory Smart control
test automation solution
equipment solutions system Adjustment Total

RM'000 RM'000 RM'000 RM'000 RM'000

Revenue

External revenue 420,716 179,871 - 600,587

Inter-segment revenue 83,471 5,068 450 (88,989) -

Total revenue 504,187 184,939 450 600,587

Results

Segment results 96,832 48,926 (3,177) (16,299) 126,282

Interest income 4,787 416 13 2,308 7,524

Interest expense (87) - - (87)

Share of results of associates - - - (1,636) (1,636)

Profit/(Loss) before taxation 101,532 49,342 (3,164) 132,083

Taxation (1,894) (100) (85) 535 (1,544)

Profit/(Loss) after taxation 99,638 49,242 (3,249) 130,539

Results for the financial year ended 31 December 2021

Automated Factory Smart control
test automation solution
equipment solutions system Adjustment Total

RM'000 RM'000 RM'000 RM'000 RM'000

Revenue

External revenue 356,327 151,759 303 508,389

Inter-segment revenue 2,060 3,542 114 (5,716) -

Total revenue 358,387 155,301 417 508,389

Results

Segment results 95,459 25,826 (1,781) (5,294) 114,210

Interest income 4,266 197 - 2,371 6,834

Interest expense (92) - - (92)

Share of results of associates - - - (1,485) (1,485)

Profit/(Loss) before taxation 99,633 26,023 (1,781) 119,467

Taxation (4,331) (37) - 538 (3,830)

Profit/(Loss) after taxation 95,302 25,986 (1,781) 115,637

4
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

12 Profit Before Taxation

Current Current
Quarter Year to Date
RM’000 RM’000
Profit before taxation is arrived at after
crediting/(charging):
Depreciation and amortisation (3,076) (10,681)
Gain/(Loss) on foreign exchange:
- realised 561 240
- unrealised (12,177) (904)
Gain/(Loss) from changes in fair value of foreign
currency forward contracts 12,703 (7,604)
Gain on disposal of other investments - 15
Interest income 2,839 7,524
Interest expense (27) (87)
Loss from changes in fair value of other investments (3) (16)
Gain on disposal of property, plant and equipment - 58
Property, plant and equipment written off - -
Intangible assets written off - -
Investment income - -
Inventory written down - addition (65) (245)
Inventory written down - reversal (36) 102
Net reversal of ECL allowance on trade receivables 4,492 4,798
Bad debts written off - -
Waiver of other payable 4,780 4,780

13 Events Subsequent to the End of the Financial Year

There are no material events subsequent to the end of the financial year under review that
have not been reflected in the interim financial report.

14 Review of Performance

Individual Quarter Cumulative

3 Months Ended Financial Year Ended
31/12/2022 31/12/2021 Variance 31/12/2022 31/12/2021 Variance
RM’000 RM’000 % RM’000 RM’000 %
Revenue 147,659 122,491 20.5 600,587 508,389 18.1
Operating profit 37,723 32,342 16.6 133,806 121,044 10.5
Profit before taxation 36,925 31,796 16.1 132,083 119,467 10.6
Profit for the financial
period/year 35,945 30,846 16.5 130,539 115,637 12.9

The Group recorded a quarterly revenue of RM147.7 million in the 3-month ended 31
December 2022 (“4Q2022”) as compared to RM122.5 million registered in the 3-month
ended 31 December 2021 (“4Q2021”), representing an increase of 20.5%. For the entire
financial year ended (“FYE”) 31 December 2022 (“12M2022”), the Group recorded a
higher revenue of RM600.6 million as compared to RM508.4 million in the FYE 31
December 2021 (“12M2021”), representing an increase of 18.1%.

5
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

The Group’s revenue was mainly contributed by the ATE and FAS segments, constituting
approximately 70.1% and 29.9% respectively of the Group’s total revenue in FYE 31
December 2022.

The below outlined the revenue of the respective operating segments.

Individual Quarter Cumulative

3 Months Ended Financial Year Ended
31/12/2022 31/12/2021 Variance 31/12/2022 31/12/2021 Variance
RM’000 RM’000 % RM’000 RM’000 %
ATE 94,411 86,253 9.5 420,716 356,327 18.1
FAS 53,248 36,139 47.3 179,871 151,759 18.5
Smart control solution system - - - - 303 n.m.

The following table sets out revenue breakdown by customers’ segment for the Group:

Individual Quarter Cumulative

3 Months Ended Financial Year Ended
31/12/2022 31/12/2021 31/12/2022 31/12/2021
RM’000 % RM’000 % RM’000 % RM’000 %
Automotive 69,464 47.0 38,143 31.1 254,856 42.4 104,322 20.5
Electro-Optical 25,673 17.4 38,721 31.6 117,409 19.5 223,067 43.9
Medical devices 33,379 22.6 8,046 6.6 84,581 14.1 29,293 5.8
Semiconductor 13,960 9.5 13,004 10.6 84,001 14.0 72,449 14.3
Consumer and industrial 5,183 3.5 24,478 20.0 59,740 10.0 78,955 15.5
products
Others - - 99 0.1 - - 303 n.m.
Total 147,659 122,491 600,587 508,389

The Group closed its 4Q2022 with a profit before taxation of RM36.9 million (4Q2021:
RM31.8 million), representing an increase of approximately 16.1%. The Group closed
its 12M2022 with a profit before taxation of RM132.1 million, representing an increase
of 10.6% from a profit before taxation of RM119.5 million recorded in 12M2021. The
Group’s EBITDA (earnings before interest, tax, depreciation and amortisation) for the
4Q2022 stood at RM40.0 million (4Q2021: RM34.2 million), representing an increase of
17.1%, while the Group’s EBITDA for the 12M2022 stood at RM142.9 million
(12M2021: RM128.9 million), representing an increase of 10.9%. Basic earnings per
share increased from 2.79 sen in 4Q2021 to 3.20 sen in 4Q2022 and increased from 10.24
sen in 12M2021 to 11.58 sen in 12M2022.

6
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

Performance of the respective operating segments for the current quarter as compared to
the previous corresponding quarter is analysed as follows:

1) Automated test equipment

Revenue in the ATE segment jumped by RM8.2 million to RM94.4 in 4Q2022

(4Q2021: RM86.3 million) and RM64.4 million to RM420.7 million for the
12M2022 (12M2021: RM356.3 million), showing a meaningful growth of 9.5% in
4Q2022 and 18.1% in 12M2022.

The ATE segment, being the Group’s main revenue source, continued to contribute
the larger portion of the Group’s overall revenue and profit during the year. After
marking a turnaround in 2021 with its double-digit growth rate of 25.9%, total
revenue from this segment continued to grow at 18.1% to RM420.7 million in 2022.
During the year, backed by the electrification in the automobile industry and the
proliferation of the electric vehicles (“EV”) ecosystem, the automotive industry
emerged as the leading segment within the ATE business unit, contributing
approximately 58.4% as compared to 27.6% in the previous year. Such significant
growth of the automotive segment within the ATE business unit at an astounding rate
of 150.1% did not only signify the Group’s encouraging milestone in penetrating the
automotive industry but was a testament to the Group’s comprehensive products and
solutions offering for the automotive industry. Underpinned by a massive wave of
developments in automotive electrification and the various global decarbonisation
policies which accelerated the adoption of EV, the Group’s broad array of automotive
test solutions specifically the front-end tester for SiC and back end solutions for
power devices made a meaningful breakthrough in the addressable market.

On the other hand, while the semiconductor industry is inherently cyclical, the ATE
segment also benefitted from the semiconductor industry with its revenue
contribution rate of 19.9%, representing an overall 17.6% growth as compared to
2021. Given the wide application of semiconductor contents in multiple industries
from computer, telecommunication, healthcare, automotive to general industrial
application coupled with the growing adoption of consumer electronics from the
rapid urbanisation and improved living standards, the market growth of
semiconductor production continues to bring opportunities and demand for the
Group’s test handling equipment.

In contrast, revenue from the electro-optical within the ATE segment contracted to
19.0% in 2022, from 49.7% in 2021, which represented an overall drop of 54.9%.
Recognising that the smartphone market has reached a certain plateau given the lack
of major upgrade and development in smart sensors, the drop in revenue from this
segment was within the Group’s expectation. During the year, revenue from this
segment was mainly derived from the module upgrade of the Group’s existing smart
device test solutions.

Overall, the Group’s strong presence in the automotive industry has complemented
its ATE business and such positive development will continue to provide impetus for
growth to the overall Group’s ATE segment in the mid-to long term.

The ATE segment experienced a decrease in the profit before taxation by 11.0% from
RM24.0 million during the 4Q2021 to RM21.4 million for the 4Q2022 mainly due
to the component cost increase and rising labour cost in this highly inflationary

7
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

environment. However, such adverse cost impacts were partially mitigated by the
Group’s increased exposure to the industry segment with better margin. For
12M2022, the Group profit before taxation decreased by 4.4% from RM99.0 million
in 12M2021 to RM94.7 million in 12M2022.

2) Factory automation solutions

Revenue from the FAS segment registered a double-digit growth of approximately

47.3% in the 4Q2022 as compared to the 4Q2021. This brought the FAS segment
achieving a total revenue of RM53.2 million in 4Q2022 (4Q2021: RM36.1 million)
and RM179.9 million for the 12M2022 (12M2021: RM151.8 million), representing
an overall increase of 18.5% in the 12M2022.

The FAS segment of the Group has been gaining its traction over the last few years.
Since the listing of the Company, the FAS segment has been consistently recording
years of double-digit revenue growth with the exception of 2019 where a decrease of
18.4% was recorded. In 2022, the FAS segment continued to witness double-digit
growth rate in its contribution to the Group’s revenue, chalking 18.5% growth to
achieve RM179.9 million during the year. Specifically, the revenue momentum in
this segment picked up in the third and fourth quarter of the year, with revenue in
second half of the year exceeding its first half by 46.4%.

The medical devices segment leading and driving the Group’s FAS growth this year
with its revenue contribution rose to 41.5% from 19.3% in the previous year. The
strong year-on-year revenue growth of 154.6% from the medical devices segment
was mainly driven by global manufacturers of medical products in adopting the
various process and assembly automation in their manufacturing processes for better
productivity and efficiency. It is also a testament of the Group’s medical automation
know-how post acquisition of TP Concept Sdn Bhd in 2019 that has started to have
a positive bearing in the Group’s exposure for the medical industry. Revenue from
other business segments, such as consumer and industrial products segment and
electro-optical segment contributed 32.3% and 20.9% respectively towards the FAS
business unit during the year.

The emergence of digital technologies has accelerated the adoption of automation.

Many companies across various industries are seen adopting automation in a broader
manner especially in a post-pandemic environment in achieving efficiency and
productivity within a safe operating environment. With the current automation trend
and the acceptance of Industry 4.0, the FAS segment will continue to grow and
contribute positively to the Group.

The FAS segment recorded a higher profit before taxation by 194.7% to RM23.8
million for the 4Q2022 (4Q2021: RM8.1 million) and 110.8% to RM50.1 million for
the 12M2022 (12M2021: RM23.8 million) mainly due to an increase in revenue as
well as the following factors:
(i) favorable changes in product mix with better profit margin; and
(ii) waiver of other payable and a net reversal of ECL allowance on trade
receivables due to the subsequent recovery of trade receivables.

8
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

3) Smart control solution system

The products and solutions in this segment entail project management, smart building
solutions and trading of materials.

There was no external revenue from this segment during the financial year.

This segment recorded a loss before taxation of RM0.7 million in 4Q2022 as

compared to profit before taxation of RM0.6 million in 4Q2021 and higher loss
before taxation of RM3.2 million in 12M2022 (12M2021: RM1.8 million). The smart
control solution recorded profit before taxation in 4Q2021 and lower loss before
taxation in 12M2021 as compared to 12M2022 was a result of a net reversal of ECL
allowance on trade receivables following the recovery of the outstanding debt in
4Q2021.

15 Material Changes in the Quarterly Results as Compared with the Preceding

Quarter

3 Months Ended 3 Months Ended

31/12/2022 30/9/2022 Variance
RM’000 RM’000 %
Revenue 147,659 155,595 (5.1)
Operating profit 37,723 31,111 21.3
Profit before taxation 36,925 30,687 20.3
Profit for the financial period 35,945 31,785 13.1

In 4Q2022, the Group recorded a lower revenue at RM147.7 million as compared to the
revenue of RM155.6 million for the 3-month ended 30 September 2022 (“3Q2022”),
representing a decrease of 5.1%. The decrease in 4Q2022 revenue was mainly due to
decrease in contribution from the ATE business segment. The below outlined the revenue
of the respective operating segments.

3 Months Ended 3 Months Ended

31/12/2022 30/9/2022 Variance
RM’000 RM’000 %
ATE 94,411 101,959 (7.4)
FAS 53,248 53,636 (0.7)

9
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

The following table sets out revenue breakdown and comparison by customers’ segment
for the Group:

3 Months Ended 3 Months Ended

31/12/2022 30/9/2022
RM’000 % RM’000 %
Automotive 69,464 47.0 82,384 52.9
Electro-Optical 25,673 17.4 10,094 6.5
Medical devices 33,379 22.6 27,027 17.4
Semiconductor 13,960 9.5 15,886 10.2
Consumer and industrial products 5,183 3.5 20,204 13.0
Total 147,659 155,595

On the other hand, profit before taxation recorded an increase of 20.3% in 4Q2022 to
RM36.9 million (3Q2022: RM30.7 million), mainly due to better profit margin and net
reversal of ECL allowance on trade receivables following the recovery of the outstanding
balance during the period.

Performance of the respective operating segments in 4Q2022 as compared to 3Q2022 is

analysed as follows:

1) Automated test equipment

In 4Q2022, revenue from the ATE segment decreased by RM7.5 million to RM94.4
million (3Q2022: RM102.0 million), representing a decrease of 7.4%. The decrease
was mainly due to timing differences of project delivery that fell beyond 2022.

Despite recording a decrease in revenue, the ATE segment recorded a higher profit
before taxation by 28.2% to RM21.4 million in 4Q2022 (3Q2022: RM16.7 million)
as a result of better profit margin and derivative movement in the foreign exchange
exposure.

2) Factory automation solutions

The FAS segment also recorded a marginal decrease in revenue to RM53.2 million
in 4Q2022 (3Q2022: RM53.6 million), representing a decrease of 0.7% driven by the
project delivery for the Group’s proprietary i-ARMS solutions that was fulfilled after
2022.

Due to net reversal of ECL allowance on trade receivables, the FAS segment
witnessed an increase in profit before taxation to RM23.8 million in 4Q2022
(3Q2022: RM15.5 million).

3) Smart control solution system

There was no external revenue from this segment during the financial year.

The smart control solution system recorded lower loss before taxation in 4Q2022 at
RM0.7 million (3Q2022: RM0.8 million).

10
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

16 Prospect

“When the going gets tough, the tough get going.”

Year 2022 ended on another challenging note and it was a year of two halves. While the
aftermath of the COVID-19 pandemic continued to be felt, the first half of the year was
compounded by the various geopolitical developments and rising inflationary pressures
from the prolonged supply chain disruptions. The Group, through its various business
strategies and approaches, navigated carefully in these challenging times and embraced
the second half of the year on a better footing by executing and undertaking some of its
internal business initiatives that were geared towards building new capabilities and
revenue streams, while remaining vigilant and reactive in every stage of its execution to
ensure agility in this highly evolving situation. It was definitely a year of resilience and
a year of adaptability where the Group remained focused on its core competencies while
responding to challenges and opportunities.

With the challenging year that has been, 2023 will be a year of consolidating and
gathering internal strength and commitment to continue achieving breakthroughs in its
existing businesses and geographical markets with new growth drivers and initiatives.
Anchored by a record high order book on hand, the Group is forward-looking in
establishing another year of solid business growth. Most notably, the Group will continue
to strengthen its pillar of growth strategies in product diversification, geographical
diversification and segmental diversification. Operationally, the Group has made
headway in expanding its presence in higher growth segments namely the automotive
and medical devices segment. In respect of automotive segment, with its leading position
achieved during the year from revenue contribution standpoint, the Group expects the
growing revenue exposure from this segment to persist on the back of its strong order
fulfilment that is largely driven by the quickening pace of automotive electrification and
the various automotive-related stimulus and policies towards decarbonisation that
provide impetus to the EV market. The medical devices segment, which is now seen
dominating the Group’s FAS segment will set the scene for pushing the revenue growth
streak further within the segment as the application of automation in medical
manufacturing becomes prevalent.

The Group’s effort in its geographical diversification approach entails establishing its
presence outside of Malaysia which mainly includes China, Japan, U.S. and Singapore.
Such establishment held the Group in good stead as the Group continues to record
positive financial performance on the back of its growing sales traction achieved from
these regions that cover important key market for the business segments of the Group.
While the Group sets eyes on Germany, Indonesia and Middle East for its next
geographical expansion, the Group is mindful of the “China plus one” strategy in which
multinational firms are seen moving parts of their production outside of China, with India
and Vietnam being the two primary locations brought up in attention. The Group is of the
opinion that while such economic policy brings positive development in reducing supply
chain dependency and vulnerability, it augurs well for the overall Group’s business
growth opportunity with the potential increase in demand for the Group’s products and
solutions from these new establishment outside of China.

11
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

As the Group continues to seek opportunities to improve its financial performance, it is

also keeping a keen eye on building a sustainable environment. In addition to putting
sustainable business strategy in place, the Group is cognisant of the increasing importance
of non-financial reporting. As part of the Group’s continuing efforts in enhancing
transparency, the Group will step up its Environmental, Social and Governance (“ESG”)
disclosures by making reference to the recommendations of the Task Force on Climate-
Related Financial Disclosures (TCFD). In addition, the Group will enhance its ESG
initiatives through the formulation and implementation of the various ESG action plans
that encompass, among others, climate change initiatives, supply chain, diversity,
employees’ engagement, corporate culture and compliance to reinforce its sustainability.

As the Group enters 2023 at an encouraging pace, the Group remains cautious given the
current volatile global environment. The Group does not expect the overall sentiment to
return to pre-pandemic conditions anytime soon and while this dynamic situation remains
fluid, the Group will continue to drive operational efficiency and prudent cost
optimisation to mitigate the impact of rising material price and any other cost increase
from the inflationary pressure. Organically, the Group will continue to build its internal
capabilities and accelerate innovation across all facets of its business segments from new
product development to value chain activities to address the rapidly evolving market
requirement. On a broader level, the Group is staying on course to keep pace with its long
term growth initiatives steered by its “Grand Roadmap & key Focus 2022-2025” which
is formulated to further progress the Group towards achievement of its long term growth
trajectory.

17 Profit Forecast or Profit Guarantee

There was no profit forecast or profit guarantee issued by the Group.

18 Taxation

The taxation charge for the current quarter and year to date is as follows:

Current Year to
Current Quarter Date
RM’000 RM’000
Income tax payable (980) (1,544)
Income tax credit - -

The effective tax rate is lower than the statutory tax rate as certain subsidiaries of the
Group have been granted pioneer status under the Promotion of Investments Act, 1986
by the Malaysian Investment Development Authority which exempts 100% of
statutory income in relation to production of certain products and solutions.

12
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

19 Changes in the Composition of the Group

There were no changes in the composition of the Group during the quarter under review.

20 Corporate Proposals

There were no corporate proposals announced but not completed as at the date of this
announcement, except for the following:

Investment in Everready Precision Industrial Corp, Taiwan, Republic of China

On 4 July 2022, the Company announced that Pentamaster InnoTeq Sdn. Bhd. (“PISB”),
a wholly owned subsidiary of PCB, has on that date, subscribed for 16,614,507 new fully
paid up ordinary shares in Everready Precision Industrial Corp, Taiwan, Republic of
China (“EPIC”) (“EPIC Shares”) representing 29.9% of the enlarged equity interest in
EPIC (“Proposed Subscription”) for a total consideration of approximately
USD6,777,000 (equivalent to RM28,225,000). The completion of the Proposed
Subscription is pending the approval of the Kaohsiung Nanzih Technology Industrial
Park in Taiwan and the allotment of the new EPIC shares to PISB.

21 Status of Utilisation of Proceeds Raised from Any Corporate Proposal

1) Share Award Scheme

The utilisation of proceeds of RM29.5 million raised from the share award scheme,
in conjunction with the Listing Exercise of PIL, as at the end of the reporting quarter
is as follows:
Gross
Proposed Proceeds Actual
Utilisation Received Utilisation Intended Timeframe Balance
Purpose (RM’000) (RM’000) (RM’000) for Utilisation (RM’000)
Payment of staff salaries and
benefits 4,500 4,500 4,500 Within one (1) year -
Purchase of raw materials
such as sensors, control
panels, input/output control
and computer field bus
system and other services
such as subcontracting work 20,000 20,000 2,048 Within eight (8) years(3) 17,952
General administrative and
operating expenses 5,000 5,000 5,000 Within one (1) year -
Total 29,500 29,500 11,548 17,952

13
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

2) Listing Exercise of PIL

The utilisation of proceeds of RM87.1 million from the offer for sale of PIL Shares
by the Company, in conjunction with the Listing Exercise of PIL, as at the end of
the reporting quarter is as follows:

Proposed Utilisation Gross

Minimum Maximum Proceeds Actual Intended
Scenario(1) Scenario(1) Received(2) Utilisation Timeframe for Balance
Purpose (RM’000) (RM’000) (RM’000) (RM’000) Utilisation (RM’000)
Business expansion through Within eight (8)
investment and acquisition 33,972 37,775 32,741 5,000 years(3) 27,741
Investment into technology
related solutions and business Within eight (8)
applications 29,726 33,059 28,648 26,129 years(3) 2,519
Within five (5)
Working capital 21,172 23,549 20,405 20,405 years -
Defray estimated expenses in
relation to Listing Exercise,
bonus issue and share split, Within six (6)
collectively 5,508 5,508 5,306 5,306 months -
Total 90,378 99,891 87,100 56,840 30,260

Notes:

(1) The minimum and maximum scenario under the proposed utilisation was
based on the indicative offer price in relation to the Listing Exercise of
HKD0.95 and HKD1.05 respectively.

(2) The actual gross proceeds received was based on the actual offer price in
relation to the Listing Exercise of HKD1.00. The difference between the gross
proceeds received and the proposed utilisation was due to the difference in
the conversion rate.

(3) The original intended timeframe for utilisation of two (2) years was extended
to five (5) years on 17 January 2020 and further extended to eight (8) years
on 18 January 2023.

22 Borrowings

There are no outstanding borrowings or debt securities as at the end of the reporting
period.

14
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

23 Derivative Financial Instruments

As at the date of the statement of financial position 31 December 2022, the Group has
the following outstanding derivative financial instruments:

Contract or Fair value

Notional amount Net gain/(loss)
Derivatives (RM’000) (RM’000) Purpose

Currency
forward
contracts:
-Less than 1
year 226,252 (6,358) For hedging currency risk
arising from sales proceeds
in foreign currencies

For the quarter ended 31 December 2022, there have been no significant changes to the
Group’s exposure to credit risk, market risk and liquidity risk from the previous financial
year. Also, there have been no changes to the Group’s risk management objectives,
accounting policies and processes since the previous financial year end. Financial
instruments are viewed as risk management tools by the Group and are not used for
trading or speculative purposes.

24 Fair Value of Financial Liabilities

For the quarter ended 31 December 2022, there is no fair value gain or loss on the
financial liabilities. The carrying amounts of the financial liabilities as at date of the end
of the statement of financial position date approximate to their fair value due to their
short-term nature.

25 Material Litigations

There was no material litigation since the last annual balance sheet date until the date of
this announcement.

26 Dividends

The Directors recommend a final single-tier dividend of RM0.02 per ordinary share
amounting to approximately RM14.2 million in respect of the financial year ended 31
December 2022 for shareholders’ approval at the forthcoming Annual General Meeting.
The current financial statements do not reflect this proposed dividend. Such dividend, if
approved by the shareholders, will be accounted for in equity as an appropriation of
retained earnings in the financial year ending 31 December 2023.

15
PENTAMASTER CORPORATION BERHAD (“PCB” or “COMPANY”)
COMPANY NO.: 200201004644 (572307-U)
NOTES TO THE INTERIM FINANCIAL REPORT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022

27 Earnings Per Share

The calculation of basic earnings per share for the quarter and financial year based on the
profit attributable to owners of the Company for the quarter and financial year divided
by the weighted average number of ordinary shares in issue during the quarter and
financial year.

3 Months 3 Months 12 Months 12 Months

Ended Ended Ended Ended
31/12/2022 31/12/2021 31/12/2022 31/12/2021
RM'000 RM'000 RM'000 RM'000

Profit attributable to owners of the Company 22,743 19,890 82,418 72,911

Weighted average number of ordinary shares 711,565,346 712,317,121 711,565,346 712,317,121

Earnings per share attributable to owners of the Company

(sen) 3.20 2.79 11.58 10.24

BY ORDER OF THE BOARD

ADELINE TANG KOON LING

Secretary
23 February 2023

16