EQUATION SUMMIT LIMITED - Digital Safety

READY FOR THE NEXT PHASE

OF GROWTH

ANNUAL REPORT 2015

On the Cover:

READY FOR THE NEXT PHASE OF GROWTH, this cover projects expansion and dynamism with graphical depiction of driving force behind the Company's vision of long-term growth and value.

TABLE OF CONTENTS

01

CORPORATE STRUCTURE

02

CORPORATE PROFILE

05

LETTER TO SHAREHOLDERS

08

BOARD OF DIRECTORS

10

GROUP KEY EXECUTIVES

11

CORPORATE INFORMATION

12

FINANCIAL HIGHLIGHTS

13

OPERATING AND FINANCIAL REVIEW

15

CORPORATE GOVERNANCE

REPORT

36

DIRECTORS' REPORT

41

STATEMENT BY DIRECTORS

42

INDEPENDENT AUDITOR'S REPORT

44

CONSOLIDATED INCOME

STATEMENT

45

CONSOLIDATED STATEMENT OF COMPREHENSIVE

INCOME

46

STATEMENTS OF FINANCIAL

POSITION

47

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

50

CONSOLIDATED STATEMENT OF CASH FLOWS

52

NOTES TO THE FINANCIAL

STATEMENTS

125

STATISTICS OF SHAREHOLDINGS

128

NOTICE OF ANNUAL GENERAL MEETING

All figures in this Annual Report are in Singapore dollars unless otherwise indicated.

This annual report has been prepared by the Company and its contents have been reviewed by the Company's Sponsor, SAC Capital Private Limited ("Sponsor"), for compliance with the relevant rules of the Singapore Exchange Securities Trading Limited ("SGX-ST"). The Company's Sponsor has not independently verified the contents of this annual report.

This annual report has not been examined or approved by the SGX-ST and the SGX-ST assumes no responsibility for the contents of this annual report, including the correctness of any of the statements or opinion made or reports contained in this annual report. The contact person for the Sponsor is Mr. Ong Hwee Li, Registered Professional, at 1 Robinson Road, #21-02 AIA Tower, Singapore 048542, telephone +65 6532 3829.

PROXY FORM

CORPORATE STRUCTURE

AS AT 30 JUNE 2015

TECHNOLOGY

100%

Disa Digital Safety Limited

(formerly known as Ternary

Technologies Limited)

100% Ternary Technologies (Shenzhen) Limited

100% Disa Digital Safety Pte. Ltd.

77.5%

QuickCheck

Technology Limited

(incorporated during the year)

100%

(incorporated during the year)

50%

Citrine Wireless

Pte. Ltd.

100%

QuickCheck

Group Limited

(incorporated during the year)

90%

(incorporated during the year)

50%

Citrine Solution

Pte. Ltd.

(incorporated during the year)

32.5% United Digital

Technology Pte Limited

(incorporated during the year)

50%

Aquarius Tech

Pte. Ltd.

66.1%

Disa Digital Safety GmbH

E-WASTE/RECYCLING

60% Equation Recycling Pte. Ltd.

49%

Siam Pattana

Equation Co., Ltd

ENERGY MANAGEMENT

SERVICES

70% Equation Energy Pte. Ltd.

SUPPLY OF CONSTRUCTION

MATERIALS

8710.6%% Equation Resources Pte. Ltd.

OTHERS

50% Safuan Resources Pte. Ltd.

01

ANNUAL REPORT 2015

CORPORATE PROFILE

EQUATION SUMMIT LIMITED

Equation Summit Limited ("Equation Group" or the "Group"), formerly known as Equation Corp Limited, is an investment holding company listed on the SGX Catalist (formerly known as SGX-Sesdaq) since 1992.

Since 2006, the Group has actively reviewed its businesses to focus on high-value services with long term potential while divesting non-core segments to complement its growth. Today, through its subsidiaries, Equation Group operates in four core business segments, which include Energy Management Services, E-waste/Recycling, Technology and the Supply of Construction Materials.

The Group has offices in Singapore, Germany, China and the United States.

TECHNOLOGY

Disa Digital Safety Pte. Ltd. ("DDSPL") is a wholly owned subsidiary of Equation Summit Limited that specializes in research and development of cutting-edge security ("DiSa Anti-Theft System") and digital authentication ("QuickCheck") solutions.

DiSa Anti-Theft System DiSa Anti-Theft System, the world's first anti-theft protection technology uses encrypted codes on consumer electronic products. DiSa Anti-Theft System allows the manufacturers and retailers of consumer electronic products to prevent theft by integrating DiSa Anti-Theft System code into their products during the manufacturing process by making it inoperable at the point of manufacturing until the point of payment at retail stores.

DiSa Anti-Theft System has won several awards for technology innovation including two recognition of Achievement Awards for its innovative features at the 2009 Plus X Award Technology Conference in Cologne, Germany.

DDSPL is in the midst of arranging for a PoC (Proof of Concept) with Wal-Mart Store Inc. ("Wal-Mart"). Wal-Mart is an American multinational retail corporation that operates a chain of discount department stores and warehouse stores. It is the world's biggest retailer with 11,453 stores worldwide. It operates 4,516 stores in the United States, 647 Sam's Club stores and 6,290 Walmart International stores.

02

EQUATION SUMMIT LIMITED

CORPORATE PROFILE

QuickCheck Developed by DDSPL, QuickCheck is a digital authentication solution that is capable of verifying the authenticity of a product instantaneously. It allows the consumers to validate the authenticity of a product in real time prior to a purchase decision via their own devices. This is done through the scanning of a unique barcode ("QC Code") that is pasted or printed on the packaging of the products. All it takes to authenticate is a smart phone with location service.

DDSPL has signed a contract with China Tobacco Anhui Industrial Corporation on 9 March 2015 for the provision of QC Code to detect counterfeit cigarettes, a widespread problem in China. Counterfeiting is one of the fastest growing economic crimes of modern times. International Chamber of Commerce expects the value of counterfeit goods globally to exceed USD1.7 trillion by 2015.

ENERGY MANAGEMENT SERVICES

Equation Energy Pte. Ltd. ("EEPL") provides sustainable energy management solutions to the building industry in Singapore and to the region.

EEPL's core services cover Energy Auditing and Management, Design and Consultancy, funded solutions in Energy Performance Contracting as well as distribution of niche energysaving products and equipment to the building industry. It is both an accredited energy services company by the National Environmental Agency, Singapore as well as an accredited energy performance contractor by the Singapore Green Building Council.

In Energy Auditing and Management, EEPL's team of appointed engineers utilises high accuracy instrumentation complying with both Building & Construction Authority ("BCA") and International Performance Measurement & Verification Protocol ("IPMVP") for measurement and data verification.

EEPL's Design and Consultancy services are in line with BCA's Green Mark for Building Scheme launched in 2005 to move Singapore's construction industry towards more environmentally sustainable buildings. It provides clients with comprehensive gap analysis, Green Mark assessment audits and energy consultancy for both new and existing developments.

A key contributor to the company's top line is in the area of performance contracting wherein the company will undertake to implement the plant and equipment retrofit as a funded design and build project and the actual savings realised is used to repay the project cost.

To date, EEPL has successfully completed a number of energy consultancies and implemented a number of energy performance contracts. Some of the completed and on-going projects include Bodynits at Changi, IMM Building at Jurong East, Tampines Mall, Rivervale Mall, the new MOM Building at Bendemeer, Golden Mile Tower, Bukit Timah Plaza, Wheelock Place and People's Park Complex.

03

ANNUAL REPORT 2015

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