Navigating the Transition

Integrated Annual Report 

About Our Report

In line with the theme of “Navigating the Transition,” Wasco has evolved
into a dynamic integrated energy group, evolving to focus on energy
infrastructure and catering to a diverse range of industries. Our
comprehensive array of offerings, spanning pipe coating, fabrication,
and biomass energy, supports various facets of the industry continuum,
actively promoting sustainability and aiding others in expediting their
energy transition agendas.

The cover of our Annual Report this year features an infinity symbol within our Wasco ecosystem, symbolising
our enduring commitment to aligning industry advancements with sustainable practices. It serves as a gateway
for stakeholders to gain insight into our thoughtful and strategic approach to energy solutions.

This design encapsulates Wasco’s dedication to navigating the dynamic energy landscape with strategic
prowess. Beyond visual representation, it embodies our boundless initiatives, adaptability, and substantial
contributions to the broader energy transition. Through this theme, our annual report aims to highlight Wasco’s
pivotal role in empowering not only our organisation but also driving positive change within the energy sector.

Sustainable profit and growth serve as the foundation of our business, enabling us to fulfil our promise of
providing world-class solutions to clients. We pride ourselves by pushing boundaries, challenging norms, and
integrating cutting-edge technologies and innovation across all our operations. This commitment establishes
Wasco as a leading global Energy Solutions Company.

Online Version: This report and additional information on Wasco Berhad (“Wasco” or “Group” or “Company”) is
available online at our corporate website, wascoenergy.com

Feedback: We look forward to receiving and responding to any feedback on this report from our stakeholders.
Please channel your feedback or query to:

Chief Strategy Officer:

Suite 19.01, Level 19, The Gardens North Tower
Mid Valley City, Lingkaran Syed Putra,
59200 Kuala Lumpur, Malaysia
Tel: +603-2685 6800 Fax: +603-2685 6999
E-mail: [email protected]
Scope and Boundary

This Integrated Annual Report covers the reporting period of 1 January 2023 to
31 December 2023, unless otherwise stated. Information presented relates to the
activities of the Group comprising our subsidiaries, joint operations, joint ventures
and associates.

Forward-Looking Statements

This report contains certain forward-looking statements relating to future

performance. These statements and forecasts are based on current assumptions
and circumstances, which could change, hence involve uncertainty. Various factors
could cause actual results to differ materially from those expressed or implied by
these forward-looking statements.

Our Targeted Readers

This is our primary report to stakeholders and is intended to address the

information requirements of long-term investors (our equity and preference
shareholders and prospective investors). We also present information relevant
to the way we create value for other key stakeholders, including our employees,
clients, business partners, regulators and communities.

Materiality

The information presented in this report addresses matters that are most material
to our business and stakeholder value. We identify, prioritise and validate our
material matters via a three-step materiality assessment.

Independent Combined Assurance Statement

The credibility of this report is supported by strong governance practices.

Assurance for this report is provided by our Board of Directors, supported by
external verification by PricewaterhouseCoopers PLT, our auditors for financial
information and providers of limited assurance on selected non-financial
information.
Inside This Report

ABOUT OUR REPORT

1
OVERVIEW OF WASCO BERHAD
1.1 Our Vision 06
1.2 Our Mission 06
1.3 Our Core Values 07
1.4 Who We Are 08
1.5 Our Global Footprint 10
1.6 Our Corporate Information 12
1.7 Our Value Creation Model 14

2
2023 Key Highlights
2.1 Financial Highlights 18
2.2 Business Highlights 20
2.3 Event and Conference Highlights 23

3
Key Messages
3.1 Chairman & Managing Director/Group Chief Executive Officer’s Statement 28
3.2 Chief Financial Officer’s Review 40

4
Our Sustainability Journey
4.1 Chief Strategy Officer’s Statement 46
4.2 About This Report 49
4.3 Sustainability Across Our Operations 52
4.4 Sustainability Governance & Accountability 55
4.5 Materiality Assessment 58
4.6 Economic 62
4.7 Environmental & Climate Change 64
4.8 Social 75
4.9 Three-Year Sustainability Key Performance Data 85
5
Commitment to Governance
5.1 Profile of Board of Directors 94
5.2 Profile of Key Senior Management Team 99
5.3 Corporate Governance at Wasco
- Audit Committee 103
- Nomination and Remuneration Committee 108
- Governance, Compliance and Risk Committee 116
- Corporate Governance Overview Statement 122
- Additional Compliance Information 141
- Statement on Risk Management and Internal Control 142
- Statement of Directors’ Responsibility 145

6
Financial Statements and Other Information
6.1 Directors’ Report 148
6.2 Statement by Directors 152
6.3 Statutory Declaration 152
6.4 Independent Auditors’ Report 153
6.5 Statements of Financial Position 159
6.6 Statements of Profit or Loss 161
6.7 Statements of Other Comprehensive Income 162
6.8 Consolidated Statement of Changes in Equity 163
6.9 Company Statement of Changes in Equity 165
6.10 Statements of Cash Flows 166
6.11 Notes to the Financial Statement 170
6.12 Summary of Significant Recurrent Related Party Transactions 287
6.13 Top 10 List of Properties 289
6.14 Analysis of Shareholdings 291
6.15 Notice of Twenty-Fourth Annual General Meeting 295
6.16 Statement Accompanying Notice of Twenty-Fourth 301
Annual General Meeting

Proxy Form
01
04 Integrated Annual Report 2023
Overview of
Wasco Berhad
Our Vision
Our Mission
Our Core Values
Who We Are
Our Global Footprint
Our Corporate Information
Our Value Creation Model

Wasco Berhad 05
Overview of Wasco Berhad

Wasco’s Cultural Beliefs

Within Wasco, our values of partnership and commitment are deeply ingrained. These
principles are integral to our vision, mission, and operational standards, reflecting the core
essence of Wasco Berhad.

Our core values are pivotal, shaping our identity within the industries we serve and laying
the cultural groundwork that reflects our beliefs, philosophies, and priorities.

As part of the Company’s ongoing cultural transformation efforts, designed to align with
the next phase of growth in the dynamic landscape of the global energy market, our set of
values signifies our pivotal role in crafting a comprehensive and inclusive identity for our
people.

Simultaneously, these values propel our commitment to delivering value-added solutions for
our stakeholders.

In response to the evolving energy landscape, our cultural beliefs echo a resolute
dedication to the energy transition, seamlessly woven into the fabric of our values. This
commitment guides us on the transformative journey towards sustainable energy solutions.
As we adapt to the ever-changing dynamics of the global market, our shared values not
only reflect past achievements but also chart a course for a future deeply rooted in the
principles of partnership, commitment, and proactive engagement in the energy transition.

Our Vision Guided by our vision, we are

dedicated to delivering reliable
To deliver reliable and energy solutions and achieving
competitive solutions to the
energy industry with net
net-zero carbon emissions
zero carbon emission by the for scopes 1 and 2 by 2026.
year 2026.

Our Mission Our mission is a resounding call to

action, going beyond the typical
To accelerate the global company role to lead the way in
energy transition while accelerating the global energy
enhancing value for all our transition, creating value for all
stakeholders. stakeholders.

06 Integrated Annual Report 2023

 Overview of Wasco Berhad

Wasco’s values of partnership and commitment are ingrained in our identity, guiding our vision,
mission, and operations. As we transform culturally to align with the global energy market’s dynamic
landscape, these values shape our inclusive identity and underscore our pivotal role in delivering
value-added solutions.

Aligned with the evolving energy landscape, our values propel us on a transformative journey toward
sustainable energy solutions, reflecting our commitment to adapt to the ever-changing dynamics of
the global market.

Our Core Values

Passion
We will embrace our company's vision, energy and growth plans in a passionate
manner.

Performance Based
Everyone in Wasco has the same opportunity to receive rewards, career and
professional advancement based on their capabilities and achievement.

Committed to Customers
We will meet customers' expectations and deliver on our commitments every time,
all the time.

Socially Responsible
We will treat everyone with respect and empathy. We put value on being charitable,
caring for the environment and supporting our stakeholder communities.

Integrity
We will always act with integrity and will remain professional and accountable while
operating in an open and transparent manner.

Intolerant to Waste
We are always aware and mindful of operating at our most efficient in terms of cost,
time and opportunity.

Safety
We will conduct our operations in the safest manner possible, ensuring no harm to
people and no damage to the environment.

Wasco Berhad 07
Who We Are

An Emerging Global Energy Solutions Provider

Since its inception in 1999, Wasco Berhad has emerged as a leading global energy solutions provider, listed on
the Main Market of Bursa Malaysia Securities Berhad since 2002. With a diverse workforce exceeding 5,000
employees representing over 40 nationalities, our operations span across 17 countries worldwide.

Focused on two strategic business divisions – Energy Solutions Services and Bioenergy Solutions Services – we
specialise in delivering tailored services including pipe coating, corrosion protection, Engineering, Procurement,
and Construction (EPC), fabrication, and rental of gas compressors and process equipment. Serving the global
oil and gas sector, our Bioenergy Solutions Division is committed to renewable energy, agriculture development,
and infrastructure materials, catering to industries ranging from plantations to power generation.

Beyond financial success, Wasco is driven by a commitment to innovation and productivity, aiming to become
a world-class integrated energy infrastructure group. Upholding corporate values rooted in uniqueness
and capabilities, we prioritise health, safety, and environmental sustainability in all facets of our operations,
demonstrating unwavering dedication to sustainable development and community welfare.

Our Path to a Sustainable

Future

At the forefront of the

industry, Wasco is dedicated
to significantly reducing
operational carbon emissions,
with a target of achieving
net-zero emissions by 2026.
Guided by the United Nations’
Sustainable Development
Goals (UNSDGs), we are
actively pursuing targeted
initiatives to minimise our Committed to a Community-
carbon footprint, ensuring Centric Approach
a sustainable future for
generations to come. In addition to environmental impact,
our sustainability initiatives prioritise
In 2021, we introduced the community-focused effor ts,
“Wasco Forest” reforestation supporting SDG 1 (No Poverty) and
programme, a cornerstone of SDG 10 (Reduced Inequalities). By
our sustainability efforts aimed enhancing livelihoods and creating
at conserving endangered and sustainable economic opportunities
critically endangered rainforest within the communities we serve, we
tree species while contributing aim to reduce inequalities and uplift
to the restoration of forests the lives of those involved in our
in Pahang. Targeting species reforestation efforts.
such as Merawan and Meranti,
alongside other endangered
varieties listed in the 2000
Red List (IUCN 2001), this
initiative seamlessly aligns
with the UNSDGs, particularly
SDG 13 (Climate Action) and
SDG 15 (Life on Land), by
directly addressing the climate
crisis and emphasising the
preservation and sustainable
use of terrestrial ecosystems.

08 Integrated Annual Report 2023

 OUR EXPERTISE IN COATING
MORE THAN 22,000 KM
OF PIPELINES OVER
4 CONTINENTS ACROSS
25 COUNTRIES
’s Pipeline Services Division is renowned for its expertise in
pipe coating, pipe manufacturing and corrosion protection solutions.

DELIVERING WORLD-CLASS
ENGINEERING & FABRICATION
SERVICES FOR THE
ENERGY INDUSTRY
Comprehensive solutions covering engineering design,
procurement, packaging, general fabrication, installation,
commissioning, operation and maintenance (O&M) services.

DRIVING THE
TRANSITION TOWARDS
CLEANER ENERGY FUTURE
THROUGH END-TO-END
BIOMASS ENERGY GENERATION
EXCELLENCE
Wasco Bioenergy Services Division is the largest fabricator of
steam biomass turbines and boilers, serving 70% of the plantation
industry. These high-capacity boilers, fueled by biomass waste and
natural gas, contribute to eco-friendly solutions. Our Heat
Recovery System Generator technology achieves 80%+ efficiency,
significantly reducing the carbon footprint for industrial clients.

Wasco Berhad 09
 Our
Global
Footprint
With a strong presence in Malaysia, we have
successfully expanded our footprint globally
across 17 countries worldwide.

10 Integrated Annual Report 2023

Malaysia
KUALA LUMPUR (HQ) I PAHANG I SELANGOR I SABAH

United Kingdom Netherlands Germany Italy Greece USA Canada Dubai

HARTLEPOOL ENSCHEDE LIETZOW PADOVA THISVI LOUISIANA REGINA JAFZA

Qatar Tanzania India China Australia Singapore Indonesia Myanmar

DOHA DAR ES SALAAM | SOJO GUJERAT BRISBANE BATAM | MEDAN

Wasco Berhad 11
Our Corporate Information

DIRECTORS GROUP COMPANY SECRETARY

Woo Ying Pun (MAICSA 7001280)
Dato’ Seri Robert Tan Chung Meng SSM Practicing Certificate No. 201908002179
Non-Independent Non-Executive Chairman

Gian Carlo Maccagno

Managing Director/Group Chief Executive Officer AUDITORS

Tan Sri Saw Choo Boon PricewaterhouseCoopers PLT

Senior Independent Non-Executive Director (LLP0014401 – LCA & AF 1146)
Chartered Accountants
Level 10, 1 Sentral
Datin Wan Daneena Liza Binti
Jalan Rakyat
Wan Abdul Rahman Kuala Lumpur Sentral
Independent Non-Executive Director 50706 Kuala Lumpur
Malaysia
Lily Rozita Binti Mohamad Khairi
Independent Non-Executive Director

Chan Cheu Leong SOLICITORS

Non-Independent Non-Executive Director
Rahmat Lim & Partners
Halim Bin Haji Din
Non-Independent Non-Executive Director
PRINCIPAL BANKERS
Tan Sri Professor Lin See Yan
Non-Independent Non-Executive Director HSBC Bank Group
Malayan Banking Berhad
Tan Jian Hong, Aaron OCBC Bank Group
Non-Independent Non-Executive Director RHB Bank Berhad

PRINCIPAL ADVISERS
Maybank Investment Bank Berhad
RHB Investment Bank Berhad

12 Integrated Annual Report 2023

 Our Corporate Information

SHARE REGISTRAR STOCK EXCHANGE LISTING

Tricor Investor & Issuing House Services Sdn. Bhd. Main Market of Bursa Malaysia Securities Berhad
Unit 32-01, Level 32, Tower A
Vertical Business Suite, Avenue 3, Bangsar South
No. 8, Jalan Kerinchi, 59200 Kuala Lumpur
Malaysia
DATE OF LISTING
Tel : 603-2783 9299
9 July 2002
Fax : 603-2783 9222
Email : [email protected]

CATEGORY
REGISTERED OFFICE ADDRESS Sector : Energy
Sub-Sector : Energy Infrastructure, Equipment &
Suite 19.01, Level 19, The Gardens North Tower
Services
Mid Valley City, Lingkaran Syed Putra
59200 Kuala Lumpur
Malaysia
Tel : 603-2685 6800 STOCK CODE
Fax : 603-2685 6999
Email : [email protected] 5142
Website : www.wascoenergy.com

STOCK NAME
PRINCIPAL PLACE OF BUSINESS
WASCO
Suite 19.01, Level 19, The Gardens North Tower
Mid Valley City, Lingkaran Syed Putra
59200 Kuala Lumpur
Malaysia
Tel : 603-2685 6800
Fax : 603-2685 6999

The respective Board Committees as stated in the last Annual Report 2022 have since been restructured with
effect from 23 May 2023 and the new Committees and their compositions are as detailed below:

NOMINATION & GOVERNANCE, COMPLIANCE &

COMMITTEE AUDIT COMMITTEE
REMUNERATION COMMITTEE RISK COMMITTEE
Chairman Datin Wan Daneena Liza Tan Sri Saw Choo Boon Lily Rozita Binti Mohamad Khairi
Binti Wan Abdul Rahman
Member Halim Bin Haji Din Tan Sri Professor Lin See Yan Tan Sri Professor Lin See Yan
Member Tan Sri Saw Choo Boon Lily Rozita Binti Mohamad Datin Wan Daneena Liza Binti
Khairi Wan Abdul Rahman

Wasco Berhad 13
Our Value Creation Model

Our Six
Business
Capital
Activities
Inputs

Financial Capital � Market Our Materiality Matters

Capitalisation: Our Vision
Securing funding from USD$1.07 billion 1. Economic Value
capital providers is � Revenue: Creation To deliver reliable
instrumental in RM2,606 million and competitive
supporting our business � Profit After Tax & solutions to the
operations, augmenting

Our North Star

Minority Interest: 2. GHG Emissions energy industry with
the cash flow derived RM108 million net zero carbon
from both operational � Order Book: emissions by the
and investment sources RM3,144 million 3. Energy year 2026
Management ______________________
Human Capital
Our Mission
Wasco's unwavering 4. Water & Wastewater
commitment to nurturing • Over 4000 Management To accelerate the
a highly skilled regional employees globally global energy
workforce underscores � Workforce comprises transition while
our dedication to more than 36 5. Waste & Hazardous
enhancing value for
harnessing human capital nationalities Materials
all our stakeholders
as a pivotal asset in Management
achieving our corporate
objectives
6. Human Rights &
Community
Relations Pipe Coating
Manufactured Capital To accelerate the
� Pipe coating and global energy
Our state-of-the-art manufacturing 7. Product Quality transition while
facilities, strategically facilities enhancing value for
positioned around the � Strategically located all our stakeholders
world, highlight our fabrication facilities 8. Labour Practices
______________________
global reach and in SEA and MEA
expertise
9. Employee Health & Engineering and
Safety Fabrication
� EPC and
� Expertise in pipe fabrication
Intellectual Capital
Services

coating 10. Employee solutions for the

Our competitive edge in manufacturing, spiral Engagement, energy industry
the energy industry is welded steel pipes, Diversity & Inclusion � Transitioning
driven by our strong offshore corrosion expertise to
Intellectual capital which control renewable
encompasses team's � EPC and fabrication 11. Training & energy sector
expertise and innovation solutions for the ______________________
Development
in niche market allowing energy industry
us to adapt swiftly and • Leading biomass
Bioenergy
lead in the sector energy generation 12. Product Design & � Biomass energy
technology
Lifecycle generation
Social & Management � Fabrication of
Relationship Capital steam biomass
turbines and
Our commitment � Community 13. Business Model boilers
transcends stakeholders, investment projects Resilience
encompassing the � Focus on social
communities where we well-being of
operate, fostering stakeholders 14. Supply Chain
collaboration, shared Management
success, and responsible
4 Pillar Objectives

engagement
15. Materials Sourcing &
Efficiency
Natural Capital Profit Sustainability
� Commitment to
Our commitment to 16. Physical Impacts of
carbon neutrality
preserving capital drives Climate Change
� Environmental
sustainability. We
stewardship Safety People
minimise environmental
initiatives
impact, protect 17. Business Ethics
� Renewable energy
biodiversity, and manage
mix and tree planting
resources responsibly for
projects
a sustainable future 18. Risk Management

14 Integrated Annual Report 2023

 Our Value Creation Model

Outcomes SDG

Output Stakeholders
Delivering Long-Term
Value
� Sustained Shareholder, Suppliers &
profitability with a Achieving net-zero Investors & Business
PATMI of RM108 carbon emissions by Analysts Partners
million 2026 to enhance
shareholder value and Employees, Regulators &
contribute to global Management Governments
� Strong order book & Board
valued at RM3,144 energy transition
million reflecting
future revenue
potential
Operational Excellence
and Safety Employees,
� Development and
Management & Board
empowerment of a Maintaining the highest
diverse workforce, safety standards and
leveraging over 4000 focusing on operational Suppliers &
employees from excellence for efficient, Business Partners
more than 36 reliable project execution
nationalities to drive
innovation and
business growth
Obtain Competitive Customers
� State-of-the-art Advantage
facilities and
equipment that Ensuring consistently Suppliers &
enable the leading high-quality products, Business Partners
manufacturing of cost-effective
spiral welded steel production, Employees,
pipes and provision customisation options, Management & Board
of EPC and and scalability
fabrication solutions

Environmental
� Proprietary Responsibility
technologies in Customers
biomass energy � Implementing
generation and energy-efficient Suppliers &
efficient energy practices and cleaner Business Partners
systems like High technologies to mitigate
Recovery Steam climate change risks
Generators (HRSG) Shareholders,
� Increasing the
Investors & Analysts
renewable energy mix to
� Continuous reduce carbon footprint
innovation in
operational Community Engagement
processes and and Development
product offerings Customers
� Investing in community
� Enhanced development initiatives Communities & NGOs
stakeholder and generating
relationships socio-economic
opportunities for Media
sustainable and
� Increased diversity inclusive growth
and representation in
leadership roles Stewardship of Natural
Resources
� Reducing emissions, Regulators & Governments
increasing � Promoting carbon
renewables, tree emission mitigation
planting for carbon through tree planting Communities & NGOs
offset, and using � Conserving natural
recycled water resources and Media
sources for increasing the use of
sustainability recycled and harvested
water sources

Wasco Berhad 15
02
16 Integrated Annual Report 2023
2023 Key
Highlights
Financial Highlights
Business Highlights
Event and Conference Highlights

Wasco Berhad 17
Financial Highlights

2022
(Re-
2019 2020 2021 presented) 2023

OPERATING RESULTS

Revenue RM’000 2,514,916 1,409,107 1,429,311 2,366,081 2,605,688

EBITDA/(LBITDA) RM’000 212,581 (118,078) 72,356 205,720 350,037

Profit/(Loss) before tax RM’000 5,562 (268,024) (100,341) 74,883 218,256

Net profit/(loss) RM’000 13,567 (306,702) (111,949) 43,130 154,828

Net profit/(loss) attributable to

owners of the Company RM’000 24,136 (295,149) (107,484) (6,300) 108,402

Basic earnings/(loss) per share sen 3.13 (38.17) (13.88) (0.81) 14.00

Gross dividend per share sen - 1.00 - - -

KEY BALANCE SHEET DATA

Total assets RM’000 2,665,350 2,267,822 2,231,441 2,713,450 2,946,650

Capital and reserves attributable

to owners of the Company RM’000 979,946 703,725 588,503 579,994 704,806

Net assets per share RM 1.27 0.91 0.76 0.75 0.91

PROFITABILITY RATIOS

Return on total assets % 2 (10) (3) 4 9

Return on capital employed % 4 (26) (9) 11 24

GEARING RATIO

Net debt to capital and reserves

attributable to owners of the
Company Times 0.82 0.91 0.87 0.79 0.48

18 Integrated Annual Report 2023

 2019 2,514,916

Wasco Berhad
2020 1,409,107

2021 1,429,311

Revenue
(RM'000)
2022 2,366,081

2023 2,605,688

2019 2,665,350

2020 2,267,822

2021 2,231,441

(RM'000)
2022 2,713,450

Total Assets
2023 2,946,650

2019 1.27

2020 0.91

2021 0.76

(RM)
2022 0.75

2023 0.91

Net Assets Per Share

19
Financial Highlights
Business Highlights

January 21 March
WSIPL Australia Pty Ltd (“WSIPL Australia”) was
29 January deregistered on 23 February 2023, as per regulations
Wasco Coatings Middle East QFZ LLC was awarded a of the Australian Securities & Investments Commission.
major contract encompassing two development phases: WSIPL Australia, incorporated on 10 May 1976, was
North Field East (“NFE”) and North Field South (“NFS”). wholly-owned by Wah Seong International Pte Limited.
This project aims to significantly increase Qatar’s LNG
production capacity. Wasco Coatings Middle East QFZ April
LLC will provide FBE anti-corrosion coating and concrete
weight coating for over 300 km of pipes, ranging in size 7 April
from 6 inches to 28 inches, including 38-inch pipes
coated entirely in Qatar. The project is expected to Appointment of Datin Wan Daneena Liza Binti Wan Abdul
be completed by December 2024, bolstering Qatar’s Rahman as Wasco Berhad’s Independent Non-Executive
position as a global energy leader. Director.

12 April
Appointment of Ms Lily Rozita Binti Mohamad Khairi as
Wasco Berhad’s Independent Non-Executive Director.

May
9 May
Wasco’s >20km pipe coating services for carbon capture
storage project (Porthos) for Nederlandse Gasunie
(“NG”). The project is designed to capture carbon
dioxide from industrial sites in the port of Rotterdam and
transport it to abandoned gas field offshore for storage.
The project commenced in November 2023 and coating
process is expected to complete by June 2024.
February
10 February
Wasco had successfully secured a medium scaled
offshore contract to provide >160km pipe coating
services to Shell Australia. The Crux project involves
the development of the Crux gas field, located in
commonwealth marine waters in the northern Browse
basin approximately 190km offshore north-west
Australia. The project had commenced in October 2023
and coating process is expected to complete by August
2024 and loadout process in March 2025.

15 February
Disposal of Leasehold Land by Petro-Pipe Industries (M) 23 May
Sdn. Bhd. completed.
1QFY2023 Financial Results Announcement and Analyst
Briefing.
23 February
4QFY2022 Financial Results Announcement & Analyst 23 May
Briefing.
Establishment of the Governance, Compliance, and Risk
Committee, and merger of the Nomination Committee
March and Remuneration Committee into the Nomination and
Remuneration Committee.
13 March
Wasco had successfully secured a multi-million-dollar Redesignation of Encik Halim Bin Haji Din as Wasco
contract to provide >200km pipe coating services Berhad’s Non-Independent Non-Executive Director.
for Sarawak Shell Berhad in Bintulu, Sarawak. The
Rosmari-Marjoram project includes a remote offshore Redesignation of Tan Sri Professor Lin See Yan as Wasco
platform, onshore gas plant, and an extensive 200+ km Berhad’s Non-Independent Non-Executive Director.
sour wet gas offshore pipeline. Phase 1 of the project
had commenced in September 2023 and expected to Appointment of Tan Sri Saw Choo Boon as Wasco
complete by June 2024. Berhad’s Senior Independent Non-Executive Director.

20 Integrated Annual Report 2023

 Business Highlights

30 May October
Wasco Berhad (formerly known as Wah Seong
Corporation Berhad) 23rd Annual General Meeting; 12 October
proposed name change from Wah Seong Corporation Wasco AgroTech Sdn. Bhd. (formerly known as PMT
Berhad to Wasco Berhad. Industries Sdn. Bhd.) has entered into a Sale and
Purchase Agreement with Array Metal (M) Sdn Bhd for
31 May the disposal of a piece of freehold land in the District of
Klang, Selangor measuring approximately 18,363 square
Notice of Registration of New Name issued by the meters under the category of “Perusahaan” together
Companies Commission of Malaysia, changing the with the office building, factory and structures erected
Company’s name to “Wasco Berhad” with effect from 31 thereon for a total consideration of RM40 million.
May 2023.
24 October
June
WS Engineering & Fabrication Pte. Ltd. (“WSEF”),
1 June has been awarded a contract by Schneider Electric
France, valued at USD33,889,973 (equivalent to
Appointment of Mr Ramanathan A/L P.R. Singaram as RM161,861,900 based on the exchange rate of
Chief Financial Officer.
USD1.00 to RM4.7761) for the supply of pre-fabricated
buildings for a project in Africa (“Contract”). The
July scope of work of the Contract involves engineering,
procurement and construction of pre-fabricated
1 July buildings. The work and services of the Contract are
Retirement of Mr Chan Cheu Leong from the position of expected to be completed within 17 months.
Managing Director/Group CEO and remains as a Non-
Independent Non-Executive Director; Mr Gian Carlo November
Maccagno succeeded the role as Managing Director/
Group CEO of Wasco Berhad.
2 November

August Wasco Process Engineering Sdn. Bhd. completed and

delivered 46 units of PV and HEX to the United States
8 August America. Consisting of 14 units oversized equipment
which delivered with 2 barges via WPE jetty to Port
Wasco Thermal Sdn. Bhd. (formerly known as Mackenzie Klang. The whole fabrication process completed within 8
Industries Sdn. Bhd.) was awarded the MUDA paper months.
project which successfully obtained the complete
package of an EFB-burning biomass boiler, rated at 50T,
along with its fuel feeding system and flue gas emission
treatment system. Testing and commissioning concluded
in August 2023.

24 August
2QFY2023 Financial Results Announcement & Analyst
Briefing.

September
29 September
Wasco Process Engineering Sdn. Bhd. (formerly known
as Jutasama Sdn. Bhd.) delivered reactor weight of 150
ton each, with the thickness of 149mm SA387 Gr.22
CL2 material. The thickest shell plate under Cr-Mo
category being fabricated.

Wasco Berhad 21
Business Highlights

14 November December
Wasco demonstrated its commitment to community
welfare and sustainable development by contributing 4 December
its inaugural Zakat funds to the Federal Territory Wasco AgroTech Sdn. Bhd. first unit RB8 Commissioning
Islamic Religious Council’s Zakat Collection Centre. The for PT Archipelago Timur Abadi.
ceremony, held at the National Palace, featured Dato’
Mohamed Nizam Bin Abdul Razak, Chairman of Yayasan
Wasco, representing the Group in presenting the Zakat
contribution to His Majesty, the Yang di-Pertuan Agong,
Sultan Abdullah Sultan Ahmad Shah.

9 December
Wasco AgroTech Sdn. Bhd. second unit RB8
Commissioning for PT PalmaAgrindo Mandiri.

15 November 13 December

Wasco was awarded the Rosebank Surf Project (Equinor) Wasco was awarded the Bindu Project (ExxonMobil)
project to coat 43.8km of 3LPE & 3LPP coating job in project to coat 63km of 3LPE, 3LPP, and CWC coatings
the United Kingdom. Project is expected to commence in for offshore pipelines in Terengganu. This project is
July and completed in August 2024. expected to complete by July 2024.

Successful delivery of the M40 E-House Module for 19 December

an FPSO destined for the Bonaparte Basin in the Timor Wasco Thermal Sdn. Bhd. custom-designed a 40T EFB
Sea, offshore Australia. Construction commenced on 25 burning biomass boiler, complete with fuel delivery
April 2022, with the first steel cut. This DNV certified system and flue gas emission control system to suit the
E-House includes three distinctive Switchgear rooms, business requirement. The successful commissioning of
one Transformer Room, one Battery Room, and a rooftop this EPPOR pack project took place in December 2023.
HVAC system (622kW - 2 x 100%). The construction
involved extensive ducting routes and integrating an
Inergen Package as part of the Fire Suppression System.
This comprehensive setup underscores the commitment
to precision and excellence in ensuring functionality,
safety, and compliance.

29 December
Maple Sunpark Sdn. Bhd. has entered into the Sale
and Purchase Agreements with Wasco Thermal Sdn.
Bhd. for the sale of properties at a total consideration
of RM64.89 million. The sale of properties include
28 November two pieces of industrial land in the District of Klang,
Selangor, measuring about 18,211 square metres (sq m)
3QFY2023 Financial Results Announcement & Analyst and 18,186 sq m in area, respectively, together with a
Briefing. detached factory/warehouse and office building erected
thereon.

22 Integrated Annual Report 2023

 Event and Conference Highlights

In 2023, we actively participated in both local and international events. These

gatherings provided valuable platforms for exchanging insights and ideas for the
progression of our industry. Furthermore, these engagements enhanced our
comprehension of effectively addressing future energy demands, thereby
broadening our capacity to unlock our full potential.

22-24 June
The PD&T and Partners HSE
Conference in Kota Kinabalu,
Sabah, centered on the theme
of “Harnessing the Power of
Collaboration” with a focus on
sustainability, culture, and
technology. Co-hosted and
exhibited by Wasco, the event
featured Ariesza Noor, Chief
Strategy Officer, as a panel
speaker, discussing
“Survivability or Left Behind
–Transformation in an
Exponential Era.” Additionally,
Vice President, Group HSE, Iqbal
Abdullah, and Senior Manager
ESG, Teoh Chuen Seng,
represented the organisation,
contributing to insightful
discussions and networking
opportunities, aimed at
advancing HSE practices and
sustainability initiatives.

26-28 June
Energy Asia Charting Pathways for a
Sustainable Asia held at Kuala Lumpur
Convention Center. We participated as a
Bronze sponsor of the event and were
represented by Chief Financial Officer,
Ramanathan Singaram, and Chief 4-7 July
Strategy Officer, Ariesza Noor. “One Vision, Infinite Possibilities” series of town halls was
held at Wasco’s subsidiaries offices for the Managing
Director/Group CEO, Gian Carlo Maccagno to share his
vision of a unified Wasco and his 100 days plans.

Wasco Berhad 23
Event and Conference Highlights

4-6 October
Palmex Indonesia is the only specialised Palm Oil event in Asia that brings together an international
congregation of both upstream and downstream palm oil companies. The 12th edition was held in
Medan, Indonesia, with Chief Executive Officer, Andrew Wong of Wasco AgroTech and the team.

7-9 November
MPOB International Palm Oil
Congress and Exhibition (PIPOC)
2023 held at Kuala Lumpur
Convention Center. We were
exhibitors at the event and
Managing Director / Group Chief
Executive Officer, Gian Carlo
Maccagno and Chief Strategy
Officer, Ariesza Noor, Wasco
Berhad were present together
with Chief Executive Officer,
Andrew Wong and Senior Vice
President, Chia Kim Har of
Wasco AgroTech. PIPOC 2023
brings together the best leaders
in all aspects related to the palm
oil industry, including planting,
processing, managing, and
trading, to contribute insights
and enrich the discussion for a
better, more sustainable future.

24 Integrated Annual Report 2023

 Event and Conference Highlights

6-7 December
Annual Group Conference with the theme “Pioneering Progress:
Forging a Future of Success.” A gathering of the Group’s top
executives to discuss achievements and future strategies. Day 1
focused on progress, while Day 2 featured a panel discussion on
“Charting the Green Path: Success through Sustainable
Strategies,” moderated by Gian Carlo Maccagno, Wasco Berhad’s
MD/Group CEO, with industry leaders -- Lily Rozita Mohamad
Khairi (Shell Plc), Datuk Md Arif Mahmood (former Petronas EVP
Downstream), and Dr. Renard Siew (Yinson Holdings Berhad). The
20-21 November conference concluded with insights on navigating sustainable
We supported the Malaysia Upstream success, emphasising resilience and innovation. Wasco is
Project Excellence Conference (UPEC) as committed to translating these insights into action, fostering
a Gold Sponsor and were represented by collaboration, and pioneering progress in the energy industry with
Vice President, Communications & sustainability and innovation at its core.
Branding, Juliana Jamaluddin, Vice
President Commercial, Raymond Tan and
Vice President, Sales, Mak Wing Tak. The
two-day conference, held at the Kuala
Lumpur Convention Center, serves as the
epicentre for connecting, collaboration,
and innovation.

15 November
Wasco showcased its
commitment to
environmental stewardship
at the Pahang State
Department of Forestry’s
International Forest Day
2023 Exhibition. Against the
backdrop of this celebration
and the Official Launch of
the Rompin District Forest
Office by His Majesty, the
Yang di-Pertuan Agong,
Sultan Abdullah Sultan
Ahmad Shah, Wasco
highlighted its sustainability
efforts, with a focus on the
‘Wasco Forest’ project,
marking significant progress
with the planting of 160,000
trees towards the net-zero
emissions goal.

Wasco Berhad 25
03
26 Integrated Annual Report 2023
Key
Messages
Chairman & Managing Director/
Group Chief Executive Officer’s Statement
Chief Financial Officer’s Review

Wasco Berhad 27
Chairman
and Managing
Director/
Group CEO’s Gian Carlo
Statement
Dato’ Seri Robert
Maccagno Tan Chung Meng

10.1% 10.1%
year-on-year
year-on-year

Revenue Revenue

RM2.6 billion RM260 billion

100% XX%
year-on-year
year-on-year
(more than tripled) Navigating the Transition (more than tripled)
Profit After Tax Profit After Tax
Our Valued Stakeholders,
RM154.8 million RM154.8 million
In the dynamic landscape of the energy sector, we, as leaders of
Wasco Berhad (“Wasco” or “Group” or “Company”), recognise the
significant paradigm shift facing companies in the energy industry.
The global transition towards sustainable energy sources, 100%
100% alongside
escalating environmental concerns and regulatory year-on-year
standards,
year-on-year
mandates a strategic re-evaluation of conventional business
Profit Before Tax models. To thrive in this transformative era, we must champion
Profit Before Tax
innovation, flexibility, and forward-thinking strategies to adeptly
RM218.3 million navigate the energy transition.
RM217.3 million

28 Integrated Annual Report 2023

 Chairman and Managing Director/
Group CEO’s Statement
Aligned with Wasco’s visionary goal of delivering reliable and competitive solutions to the energy sector with
net-zero carbon emissions by 2026 for our Scope 1 and Scope 2 emissions, we proudly stand at the forefront
of this energy revolution. This strategic narrative delineates key actions and strategies for us to deftly navigate
the energy shift towards sustainability while fostering innovation and propelling growth.

With a steadfast commitment to our shared vision, bolstered by the support of our dedicated team and the
expertise of our Board of Directors, we have successfully integrated, consolidated, and optimised our operations
to achieve promising outcomes. By setting clear objectives and fostering collaborative efforts, we have
accomplished our first-year milestones as planned.

Guided by four fundamental pillars that underpin our corporate philosophy and strategic vision, namely Safety,
People, Sustainability, and Profit, we reaffirm our commitment to excellence, innovation, and responsibility in
all facets of our business operations. These pillars serve as the cornerstone of Wasco’s vision for the future,
encapsulating core values that drive our decisions, actions, and aspirations as an organisation.

Last year, we announced the retirement of Chan Cheu Leong and the appointment of Gian Carlo Maccagno
as the new Managing Director/Group CEO. This transition in leadership and accompanied by the roll-out of a
comprehensive transformation plan marked the beginning of a transformative journey.

Significant progress has been achieved across all areas of growth, driven by strategic initiatives aimed
at strengthening our core operations, exploring new market opportunities, and enhancing our overall
competitiveness.

Wasco Berhad 29
Chairman and Managing Director/
Group CEO’s Statement
Creating a Cohesive Wasco

As part of our transformation journey, we have realigned and restructured our business into two main segments
- energy and bioenergy. This strategic decision aims to enhance focus, streamline operations, and capitalise on
emerging opportunities in these sectors. Additionally, we have strategically taken a decision to exit the trading
business as it no longer aligned with the aspirations of the group going forward. Moreover, we have disposed
non-core assets to optimise our portfolio and strengthen our financial position.

Following the name change to Wasco Berhad on 31 May 2023, we intensified efforts to foster unity across our
organisation at operational, personnel, and cultural levels. In line with the consolidation rationale, we streamlined
support functions such as finance, procurement, contract management, IT, and human resources. Concurrently,
we harnessed cross-functional synergies by leveraging our combined resources and cross-selling services while
enhancing efficiencies through the sharing of best practices.

Crucially, we fostered a new identity among our employees,

accompanied by a shared vision, mission, and values. Various
initiatives, including brand champion workshops, training sessions,
and enhanced onboarding programmes, were undertaken to garner
employee buy-in. These efforts were complemented by initiatives
aimed at fostering unity, such as the establishment of common
communication platforms, internal portals, virtual libraries, and town
hall sessions.

30 Integrated Annual Report 2023

 Chairman and Managing Director/
Group CEO’s Statement
Solid Financial Performance

Operationally, 2023 was commendable for us, reflected in a notable financial performance. We achieved
a commendable 10.1% growth in revenue to RM2.6 billion and more than tripled profit after tax (“PAT”) to
RM154.8 million.

Our Energy Services achieved remarkable growth, with a 12.4% year-on-year increase in full-year revenue to
RM2.3 billion. This significant expansion was primarily driven by successful contract executions, coupled with
commendable financial performance, with profit before tax (“PBT”) surging to RM217.3 million, marking more
than 100% increase over the previous year.

Our Bioenergy Services recorded respectable performance, with an 8.4% year-on-year increase in revenue to
RM288.8 million and a 31.9% increase in PBT to RM48.4 million, despite operating environment challenges.
This performance was attributed to increased revenue from biomass energy boiler projects, enhanced industrial
boiler sales, and growing demand for steam turbines and agro-tech equipment.

Wasco’s solid financial standing was further underscored by a reduction in net gearing to below 0.5 times,
positioning the Group in a net cash positive position and significantly improving return on equity to 15%.

A more detailed review of our Financial Management Strategy and Performance would be discussed separately
in the CFO’s Review on pages 40 to 43 of this Integrated Annual Report.

Year-on-Year Revenue by Service Division

RM million
Energy Bioenergy

288.8
2,317.8

2,500
266.6

300
2,062.3

2,000 250

200
1,500

150
1,000
100

500
50

0 0
2022 2023 2022 2023

PBT Breakdown by Service Division

RM million
2022 2023

36.7 mil 48.4 mil

96.7 mil 217.3 mil

Energy Bioenergy Energy Bioenergy

Wasco Berhad 31
Chairman and Managing Director/
Group CEO’s Statement
Our Commitment to Environmental, Social, and Governance Excellence

We are proud to highlight the remarkable progress our organisation has made in advancing sustainability
initiatives over the past year. Guided by our unwavering commitment to economic resilience, environmental
stewardship, social equity, and governance we have achieved significant milestones.

• Our efforts have resulted in a notable 20% reduction in greenhouse gas emission
intensity compared to 2022 figures, demonstrating our dedication to mitigating climate
change.

• Our commitment to diversity, equity, and inclusion is reflected in the attainment of 15%
female representation within our Senior Management team, showcasing our commitment 15%
to fostering an inclusive workplace. Female

• Our dedication to proactive community engagement through education initiatives

and infrastructure projects, we made and continue to make a positive impact in the
communities we serve. Above achievements among others has resulted in remarkable
improvement in our sustainability disclosure scores, underscoring our commitment to
transparency and accountability, achieving a score of 4 out of 5 for Bursa Malaysia’s
FSTE4Good. 20%
As we chart our course forward, we remain steadfast in our commitment to sustainability, recognising
its integral role in shaping a brighter and more resilient future for generations to come. For a more detailed
explanation on our Sustainability Report refer to pages 44 to 91 of this Integrated Annual Report.

Operations Review

With a focused approach towards navigating the energy transition, we have strategically realigned our business
lines while strengthening core capabilities to offer comprehensive and integrated solutions to our customers.
In our pursuit to ascend the value chain, investments in research and development (“R&D”) are prioritised to
enhance technological capabilities and expand product offerings.

32 Integrated Annual Report 2023

 Chairman and Managing Director/
Group CEO’s Statement
Energy Services

Our Energy Services segment, led by the Pipe Coatings and Engineering & Fabrication Divisions, plays a pivotal
role in our operations, boasting a strong presence in Malaysia and a network spanning across 16 countries
across five continents. Past global challenges, our focus has been on enhancing operational efficiencies and
fostering collaboration among our various country operations. This strategic restructuring aims to fortify our
foundations, positioning us to capitalise on economic recoveries within our markets.

In 2023, our Energy Services demonstrated robust performance, achieving a revenue milestone of RM2.6 billion.
A notable achievement during this period was our successful bid on our first Carbon Capture Pipeline Coating
Project. This landmark win signifies a significant leap forward for us, positioning our company to take advantage
of industry advancements while actively contributing to a sustainable future. This project underscores our
commitment to leading environmental sustainability initiatives within the oil and gas sector, aligning with global
efforts to reduce carbon emissions and combat climate change.

In 2023, we expanded our offerings to include the supply of pre-fabricated buildings to new markets.
Contract wins in this area, such as supplying pre-fabricated buildings for our client Schneider, highlight our
commitment to diversification and global outreach, with a strong emphasis on sustainability. These pre-
fabricated buildings offer an environmentally friendly alternative, reducing the carbon footprint associated with
traditional construction methods. This strategic expansion aligns perfectly with our dedication to environmental
sustainability within the oil and gas sector, further reinforcing our company’s commitment to reducing carbon
emissions and addressing climate change challenges.

Our expertise and market leadership were reaffirmed by other notable contract wins, including pipeline coating
projects such as Rosmari-Marjoram and Crux Pipeline during the year. These successes have significantly
contributed to our order book of RM2.9 billion, which is set to be executed in the next six to twelve months.
These achievements underscore our reputation for delivering high-quality solutions and our ability to establish
partnerships with industry leaders, solidifying our position as a trusted and reliable partner in the oil and gas
infrastructure services sector.

Operationally, 2023 marked significant progress in the mobilisation of our new coating plant for the East African
Crude Oil Pipeline Project (“EACOP Project”), laying a solid foundation for operations to commence in the second
quarter of 2024. Additionally, our exemplary performance in the pipe coating project for Qatar’s North Field
Production Sustainability (“NFPS”) underscored our commitment to delivering exceptional quality and efficiency,
further cementing our reputation as a reliable industry partner.

Wasco Berhad 33
Chairman and Managing Director/
Group CEO’s Statement
Another notable achievement in 2023 was the successful execution of our inaugural coating project related to
Carbon Capture and Storage (“CCS”), the Porthos Project. This milestone highlights our unwavering dedication
to environmental sustainability and innovative solutions. By actively participating in projects geared towards
CCS initiatives, we demonstrate a proactive stance in addressing the challenges of climate change while
leveraging our expertise in coatings technology.

During the year, progress on executing Yinson’s Agogo floating production storage and offloading (“FPSO”)
contract remained steady, staying on track for completion in 2024, showcasing our steadfast commitment
to meeting project timelines. Simultaneously, our fabrication yard in Batam adeptly managed nine projects
concurrently, even amidst undergoing upgrades. Notably, these projects included delivering 13 units of booster
compressors for Thai Nippon Steel and Schlumberger’s Monoethylene glycol (“MEG”) PAR (“Pre-Assembled
Rack”) and PAU (“Pre-Assembled Unit’s”). This highlights our operational efficiency and capacity for seamless
project management.

We are pleased to report no health and safety incidents resulting in fatalities during the year for our Energy
Services. Our dedication to continuous improvement drives us to prioritise the safety and well-being of our
workforce above all else. We achieve this by implementing stringent safety protocols and fostering a culture
of safety awareness throughout our organisation. By doing so, we ensure that all our employees are not only
protected but also empowered to perform their duties responsibly.

For a comprehensive overview of our management of health, safety, and the environment, stakeholders are
encouraged to refer to the Sustainability Report included in the Integrated Annual Report on pages 44 to 91.

Outlook for Energy Services

As leaders in the energy services sector, we recognise the dynamic nature of the global energy industry, which
continually evolve in response to various factors, including technological advancements and sustainability
imperatives. Within this landscape, businesses specialising in pipeline coating and engineering and fabrication
are pivotal players, driving growth and adaptation to industry changes.

Pipeline Coating Market Dynamics

The Global Process Pipe Coating Market, currently valued at USD 7.5 billion, is projected to reach USD
10.6 billion by 2032, reflecting a steady growth trajectory. This expansion is fuelled by several key factors,
including increased investments in infrastructure development, stringent regulatory standards mandating
high-performance coatings for environmental protection, and the growing emphasis on sustainability. The
rise of CCS projects further amplifies the demand for specialised coatings capable of withstanding corrosive
properties, contributing to the overall growth of the pipeline coating market. Moreover, advancements in coating
technologies, such as the development of environmentally friendly coatings, are expected to drive innovation
and market expansion in the coming years.

Engineering and Fabrication Market Scope

Our energy services division operates within a growing global market, with the oil and gas infrastructure
market valued at USD 714.4 billion in 2023 and is projected to grow at over 6.7% CAGR from 2024 to 2032.
This significant growth trajectory is underpinned by various factors, including increasing demand for energy,
exploration and production activities in emerging markets, and the need for infrastructure upgrades to support
evolving industry requirements. Additionally, the emergence of digitalisation and data analytics is revolutionising
engineering and fabrication processes, enabling greater efficiency, cost-effectiveness, and predictive
maintenance capabilities. As the industry embraces these technological advancements, opportunities abound
for our division to leverage our expertise in engineering design, modular fabrication, and project management to
meet the evolving needs of our clients across the globe.

34 Integrated Annual Report 2023

 Chairman and Managing Director/
Group CEO’s Statement
Global Oil and Gas Production and Consumption

Despite the industry’s transition towards renewable energy sources, global oil production remains robust, with
major producers such as the United States, Saudi Arabia, and Russia maintaining significant output levels.
This underscores the ongoing importance of traditional oil and gas operations alongside emerging energy
trends. Furthermore, while there is a growing focus on renewable energy sources, such as wind, solar, and
biofuels, oil and gas continue to play a vital role in meeting global energy demand, particularly in sectors such
as transportation, petrochemicals, and power generation. As such, our businesses remains well-positioned
to capitalise on opportunities arising from both conventional and renewable energy segments, ensuring a
diversified portfolio and sustained growth trajectory.

Investment and Financial Outlook of the Industry

The industry’s investment landscape remains positive, with the upstream sector expected to sustain its
USD 528.0 billion investment level from 2023. Additionally, total revenues for oil and gas drilling reached
approximately USD 4.3 trillion in 2023, indicating a favorable financial outlook. Despite economic uncertainties
and fluctuations in commodity prices, strategic investments in exploration and production activities, technology
adoption, and sustainability initiatives are expected to drive long-term growth and resilience in the industry.
Our energy services division is poised to benefit from these investment trends, with opportunities for project
partnerships, capacity expansion, and market diversification on the horizon.

Conclusion

The outlook for our business is promising, driven by favorable market dynamics marked by a surging demand
for pipeline coating solutions and engineering and fabrication services. Leveraging our extensive expertise, we
are strategically positioned to capitalise on the industry’s ongoing evolution while actively contributing to its
sustainable future.

In line with these advancements, our coating facilities have undergone significant upgrades to further augment
their capabilities and offerings. In Qatar, our coating facility has successfully commissioned an anti-corrosion
plant, significantly enhancing our capacity to provide top-tier corrosion protection solutions to our esteemed
clients. Similarly, our United Kingdom (“UK”) facility has embarked on an expansion journey, modernising its
equipment to better cater to our clients’ diverse requirements. As part of this expansion initiative, we are
excited to announce our additional offering of concrete coating services in the UK following the installation of
a concrete wrap plant. Anticipated to be fully operational by the second quarter of 2024, this new addition will
enable us to broaden our portfolio of coating solutions, allowing us to better address the evolving needs of our
valued clients.

Our Batam yard, acquired at the end of 2022, has undergone extensive refurbishment to bolster its
infrastructure and operational capacities significantly. Key upgrades include the refurbishment of existing
buildings within the yard and the expansion of workshop capacities for structural work, non-destructive testing
(“NDT”), and painting services. Additionally, the yard upgrade features a newly constructed jetty boasting a
300-meter Jetty Quay Length and an impressive loadout capacity of 10,000 tons. This state-of-the-art jetty
is poised to facilitate efficient module loadout and transportation via oceangoing vessels, ensuring seamless
operations and optimising logistics management.

Wasco Berhad 35
Chairman and Managing Director/
Group CEO’s Statement

In parallel, we installed a cutting-edge thick wall plate rolling machine at our Teluk Panglima Garang yard.
This addition solidifies our position as a premier provider of regional thick wall process equipment. With this
advanced machinery now integrated into our operations, our primary objective is to substantially reduce
production time and streamline our operational processes, positioning us to effectively capture the burgeoning
market demand.

Bioenergy Services

Our Bioenergy Services, headquartered in Malaysia and with a significant presence in Indonesia, stands
as a leading force in the renewable energy and agro-industry sectors, with a strong emphasis on biomass
energy generation. Operating across regions and in South America, our segment plays a crucial role in
advancing sustainable energy solutions and promoting responsible agricultural practices. Despite navigating
global challenges, we have remained steadfast in our commitment to enhancing operational efficiencies and
fostering collaboration among our diverse operations worldwide. This strategic restructuring aims to fortify our
foundations, positioning us to capitalise on economic recoveries within our markets.

In 2023, Bioenergy Services showcased commendable performance, achieving a revenue milestone of RM288.8
million, marking an 8.4% year-on-year increase, with a corresponding PBT of RM48.4 million, reflecting robust
growth of 31.9%. This impressive performance was primarily driven by a surge in biomass energy projects,
buoyant boiler sales, and heightened demand for agro-tech equipment.

During the year, we proudly introduced our cutting-edge empty fruit brunches (“EFB”) CoGen boiler,
meticulously engineered for biomass energy generation. This state-of-the-art boiler boasts exceptional
efficiency, capable of seamlessly burning a substantial percentage of challenging EFB in a continuous
operational cycle, thus ensuring an uninterrupted power supply crucial for industrial operations. The successful
completion of two EFB CoGen projects, coupled with positive feedback from our industrial clients, has not only
solidified our reputation but also led to another repeat order for 2024. This significant achievement not only
underscores our commitment to innovation and excellence but also opens up new avenues for us to expand
our market reach. By showcasing the superior performance of our boiler offerings, we are poised to penetrate a
broader industrial sector, aligning perfectly with our strategic focus on delivering higher value offerings beyond
traditional palm oil mil (“POM”) boilers.

Despite being slightly lower than the previous year’s record of 113 units sold, the sale of 105 steam turbines
this year highlights the sustained and robust demand for our offerings in biomass energy generation. This
consistent demand not only underscores the reliability and effectiveness of our products but also ensures visibility
of recurring income from operations and maintenance (“O&M”) services. Consequently, it fortifies the division’s
financial stability and augments its long-term growth prospects.

36 Integrated Annual Report 2023

 Chairman and Managing Director/
Group CEO’s Statement
Operationally, we continued to expand our reach through our service centres, field personnel, and installations,
emphasising Wasco’s dedication to service excellence and customer satisfaction in the biomass energy sector.

In 2023, three Lost Time Incidents (“LTIs”) were recorded in our Bioenergy Services operations. The team will
continue to focus on enhancing Bioenergy’s Health, Safety, and Environment (“HSE”) management practices to
align more closely with the Group’s safety objectives. For further insights into Wasco’s commitment to health,
safety, and the environment, stakeholders are encouraged to refer to the Sustainability Report included in the
Integrated Annual Report on pages 44 to 91. Through transparent reporting and accountability, we reaffirm our
commitment to sustainability and responsible corporate citizenship.

Outlook for Bioenergy Services

Biomass Waste Energy Generation

In recent years, the outlook on biomass waste energy generation has become increasingly optimistic, buoyed
by technological advancements, policy support, and a growing recognition of the importance of sustainable
and renewable energy sources. Biomass energy, derived from organic materials like wood, agricultural residues,
and organic waste, holds immense promise in diversifying energy sources and fostering a greener and more
sustainable energy landscape.

Technological Advancements and Innovations

Biomass power plants are embracing cutting-edge conversion technologies such as gasification and pyrolysis,
aimed at enhancing energy efficiency and reducing emissions. Integration of biomass power generation into
waste-to-energy projects is gaining traction, enabling the conversion of organic waste materials into electricity
and heat, thereby addressing waste management challenges while generating energy.

Biogas produced from organic waste materials in anaerobic digesters is emerging as a significant source of
biomass energy, offering a sustainable means of energy production while mitigating waste.

Policy Support and Government Initiatives

Governments worldwide are rolling out incentives and policies to promote biomass power generation as part of
their renewable energy agendas. These initiatives are pivotal for fostering the growth and expansion of biomass
energy projects.

For instance, the Malaysian government’s Low Carbon Nation Aspiration 2040 (“LCNA”) aims to significantly
increase bioenergy production from 1 million tonnes of oil equivalent (“Mtoe”) in 2018 to 4.7 Mtoe by 2040,
demonstrating Malaysia’s commitment to renewable energy.

In Indonesia, the government’s decision to increase its biodiesel mandate from B30 to B35 in 2023, with plans
for further increments to B40 in the near future, underscores the nation’s strong commitment to expanding
its biofuel production. This initiative not only boosts domestic demand for biodiesel but also enhances the
country’s position as a key player in the global bioenergy market.

Similarly, countries like Mexico, Colombia, and Ecuador are actively promoting biofuel production through the
adoption of biofuel mandates, recognising biofuels as a viable and sustainable alternative to conventional fuels.
These policy measures not only stimulate biofuel demand but also create new opportunities for investment and
growth in the bioenergy sector on an international scale.

Wasco Berhad 37
Chairman and Managing Director/
Group CEO’s Statement
Market Growth and Economic Factors

Heightened global efforts to combat climate change and the escalating demand for clean energy sources are
driving interest in biomass power generation as a viable renewable energy solution. Malaysia’s renewable energy
sector, beyond just transitioning to renewable energy, could represent opportunities worth up to RM1 trillion,
showcasing the vast potential for investment and development.

The biomass power generation market is witnessing a shift towards more efficient and cleaner energy
production methods. There is a notable trend towards smaller, decentralised biomass power plants, particularly
in rural areas, aiming to minimise transmission losses and enhance energy accessibility.

Conclusion

The future of biomass waste energy generation appears brighter than ever, propelled by a convergence of
favorable factors and a global shift towards sustainable energy solutions. As pioneers in this field, we stand at the
forefront of innovation and progress, poised to capitalise on the burgeoning opportunities presented by the evolving
energy landscape.

Our extensive experience and proven track record in installing biomass waste power plants in Malaysia and
Indonesia uniquely position us to lead the charge towards a greener and more sustainable energy future. With a
steadfast commitment to technological advancements, we continue to push the boundaries of what is possible in
biomass energy generation, driving efficiency, reducing emissions, and maximising output.

Moreover, our strategic partnerships and collaborations further bolster our capabilities and expand our reach,
enabling us to tap into new markets and leverage emerging trends. By embracing innovation, sustainability, and
responsible business practices, we not only contribute to the growth of the bioenergy sector but also play a
pivotal role in mitigating climate change and fostering environmental stewardship.

As we look ahead, we remain dedicated to our mission of providing cutting-edge solutions that not only meet
the needs of today but also anticipate the challenges of tomorrow. With a steadfast commitment to excellence
and a vision for a cleaner, brighter future, we are confident in our ability to drive positive change and make a
meaningful impact on the world.

38 Integrated Annual Report 2023

 Chairman and Managing Director/
Group CEO’s Statement
End Note

Looking ahead, we are poised to capitalise on emerging opportunities within the global energy landscape,
leveraging our expertise, resources, and partnerships to drive sustainable growth and value creation. With a
focus on innovation and sustainability, we aim to position Wasco as a leader in the transition towards cleaner,
more efficient energy solutions.

In recognition of our strong financial performance and cash flow generation, we are considering the possibility
of distributing dividends to our shareholders. This reflects our confidence in the long-term prospects of the
company and our commitment to return some cash to our investors.

We will continue to invest strategically in our core businesses to ensure sustainable growth and maximise
shareholder value. We remain dedicated to maintaining a balanced approach to capital allocation, prioritising
investments that drive future growth while rewarding our shareholders for their ongoing support and confidence
in Wasco.

In conclusion, barring unforeseen circumstances, the future is promising for us as we embrace the challenges
and opportunities of a rapidly evolving energy landscape. With a clear vision, a dedicated team, and a relentless
pursuit of excellence, we are cautiously confident in our ability to deliver long-term value for our shareholders,
customers, and communities.

Thank you for your continued support as we embark on this exciting journey together.

Dato’ Seri Robert Tan Chung Meng and Gian Carlo Maccagno
Chairman Managing Director/GCEO
Wasco Berhad Wasco Berhad

Wasco Berhad 39
Chief Financial
Officer’s
Review

26.6% XX%
Net Cash Position Net Cash Position

RM386.7 mil RM386.68 mil

Ramanathan Singaram

Gross Net Gearing Ratio Empowering GrowthGross Netthrough

Gearing Ratio

0.5 times 0.48X and

Resilience, Innovation,
Strategic Transformation

>100%
Dear Esteemed Stakeholders,
>100%
PATMI PATMI
I am honoured to address you as we reflect on the remarkable
RM108.4 mil RM108.4 mil
journey of Wasco amidst the transformative landscape of the
energy sector. As stewards of your investments, we are dedicated
to delivering sustained value and fostering growth through
resilience, innovation, and strategic foresight.

Navigating Transformation with Purpose and Adaptability

9.3% 9.3%
Cost of Sales Cost of Sales
The energy industry is undergoing unprecedented transformation,
RM2,159.8 mil RM2,159.8 mil
driven by evolving client preferences, regulatory mandates, and
technological advancements. At Wasco we view these shifts as
opportunities to redefine our strategic direction and accelerate our
journey towards sustainable growth and profitability.

Financial Strength and Operational Excellence

Return on Equity >100% Return on Equity
>100%
Key Highlights
15% 15%
I am pleased to report that financial year 2023 witnessed robust
financial performance and operational achievements, highlighting
our resilience and strong execution.

Despite global uncertainties, we achieved a commendable 10.1%

70.2% Energy Services segment. 66.7%

growth in revenue, reaching RM2.6 billion, driven primarily by our
EBITDA EBITDA

RM350.0 mil RM344.8 mil

40 Integrated Annual Report 2023
 Chief Financial Officer’s Review

Our Energy Services segment demonstrated Value Optimisation: The divestment of non-core
significant growth, with a 12.4% increase in revenue assets allows us to unlock value and reallocate capital
to RM2.3 billion, fuelled by successful project to strategic initiatives with higher growth potential
executions. Noteworthy achievements include and returns. By streamlining our portfolio, we aim
securing landmark contracts such as the Rosmari- to maximise shareholder value and strengthen the
Marjoram Pipeline Coating Project, Crux Pipeline overall financial performance of Wasco Berhad.
Pipe Coating Project and a fabrication contract for
Schneider of Pre-Fabricated Building an energy During the year, we have also successfully disposed
project in Africa, bolstering our order book to RM2.9 parcels of land in Bukit Kemuning, Shah Alam and
billion, providing a clear revenue visibility for the in Seberang Perai, Pulau Pinang, thus unlocking
coming year. value for the Group and generating net proceeds of
approximately RM46.2 million.
Similarly, our Bioenergy Services segment recorded a
respectable 8.4% revenue growth to RM288.8 million,
underpinned by increased demand for biomass Centralised Treasury Operations: Enhancing
energy projects as well as agro-tech equipment Efficiency and Control
for the industries we serve. Our commitment to
innovation and sustainability was further evidenced In line with our commitment to operational
by the successful introduction of the biomass-fired excellence, Wasco Berhad has embarked on a
cogeneration boiler, showcasing our leadership in journey to centralise treasury operations, streamlining
renewable energy solutions. processes, enhancing efficiency, and strengthening
control over financial activities. By consolidating cash
management, liquidity planning, and risk management
Maximising Shareholder Value Through functions, we aim to optimise cash flows, mitigate
Efficient Capital Allocation financial risks, and ensure compliance with regulatory
requirements more effectively.
Central to our financial strategy is the efficient
allocation of capital, aimed at optimising returns This centralised approach enables us to leverage
and enhancing shareholder value. In pursuit of this synergies across business units, optimise banking
objective, we have undertaken the strategic initiative relationships, thereby supporting our strategic
to divest non-core assets, including our trading objectives and driving long-term value creation. By
business. This decision reflects our dedication to fostering a culture of accountability and transparency,
refining our portfolio to focus on core competencies we aim to instil confidence among our stakeholders
and high-growth opportunities within the energy and and fortify our position as a trusted custodian of
bioenergy sector. capital.

The rationale behind the decision to divest non-core Our weighted average cost of capital (“WACC”) is
assets is grounded in several strategic considerations: currently at 7.4% which is below the sector average
of 8.2%. We have proactively managed our debt
Focus on Core Competencies: By divesting non- levels and costs to ensure that the company is in a
core assets, we can concentrate our resources and healthy financial position. In financial year 2023, we
efforts on core business segments where we possess have used part of the proceeds from the divestment
distinct expertise and competitive advantages. This of non-core assets to reduce our net debt levels,
strategic focus enables us to enhance operational further strengthening our balance sheet and providing
efficiency and drive sustainable growth in areas us with the flexibility to pursue strategic growth
aligned with our long-term objectives. initiatives.

As at end 2023, our cash and cash equivalent

balance is RM 386.7 million, and our net gearing
stood at 0.5 times.

Wasco Berhad 41
Chief Financial Officer’s Review

Engagement with Shareholders: Fostering Transparency and Collaboration

Analyst Consensus

No. of Research Coverage* Analyst Call on Wasco* Average Target Price*

6 BUY − 100% RM1.49

Note:
* As at 28 February 2024

“ We actively monitor analyst consensus

and share price movements to ensure they
are aligned with our strategic objectives. As of
December 2023, all analysts covering Wasco have

”
expressed positive assessments
Wasco Share Price Movement

1.2

1.0

0.8

0.6

0.4

0.2

0
23 23 23 23 23 23 23 23 23 23 23 23
20 20 20 20 20 20 20 20 20 20 20 20
3/ 3 / 3 / 3 / 3 / 3 / 3 / 3 / 3 /
/3
/
/3
/
/3
/
1/ 2/ 3/ 4/ 5/ 6/ 7/ 8/ 9/ 10 11 12

42 Integrated Annual Report 2023

 Chief Financial Officer’s Review

At Wasco, we prioritise transparency, collaboration, Driving Sustainable Growth and Value Creation
and open communication with our shareholders. We
understand the importance of keeping our investors As we chart our course forward, our strategic
informed about our strategic direction, financial priorities remain centered on driving sustainable
performance, and key developments shaping our growth, fostering innovation, and delivering value
business landscape. To facilitate this, we maintain a for our shareholders. Through prudent financial
proactive approach to engagement, ensuring regular management, operational excellence, and a steadfast
interaction and accessibility for the investment commitment to our core values, we are confident in
community. our ability to navigate the complexities of the energy
transition and emerge as a stronger, more resilient
One of the cornerstone initiatives in our engagement organization.
strategy is the quarterly analyst briefings.
These briefings serve as a platform for sharing As we continue to navigate the evolving landscape of
comprehensive updates on our financial results, the energy sector, we remain committed to upholding
operational achievements, and strategic initiatives. the highest standards of corporate governance,
Through these sessions, we provide analysts and disclosure, and shareholder engagement. Together
investors with deeper insights into our performance with our investors, we are determined to seize
drivers, market dynamics, and future outlook. opportunities, overcome challenges, and create
enduring value for all stakeholders.
In addition to our quarterly analyst briefings, we
actively participate in investor conferences and Together, we are poised to embrace the opportunities
maintain open channels for shareholders to engage of tomorrow, drive positive change, and create lasting
with our management team. These conferences are value for all stakeholders.
excellent platforms for direct interaction, allowing
us to share insights, address inquiries, and cultivate Thank you for your continued trust and partnership.
relationships with our investors.

We understand that fostering transparency and

collaboration goes beyond scheduled events, which
is why we keep access open for investors to connect
with us, ensuring continuous dialogue and alignment
of interests. We encourage active participation, Ramanathan Singaram
welcoming questions, feedback, and constructive Chief Financial Officer
dialogue to foster a better understanding of our Wasco Berhad
business and investment thesis.

Wasco Berhad 43
04
44 Integrated Annual Report 2023
Our
Sustainability
Journey
Chief Strategy Officer’s Statement
Sustainability Across Our Operations
Sustainability Governance & Accountability
Materiality Assessment
Economic
Environmental & Climate Change
Social
Three-Year Sustainability Key Performance Data

Wasco Berhad 45
Sustainability
Report

Year In Review/
Sustainability Highlights

4.0
FTSE Russell
ESG Score

Top

25%
Ariesza Noor

by ESG Ratings amongst

237 PLCs in FBM EMAS
that have been assessed Chief Strategy Officer’s Statement
by FTSE Russell.
Nurturing a Sustainable Future

Dear Valued Stakeholders,

22%
Women Board
In this pivotal era where sustainability is no longer an option but a
necessity, Wasco stands as a beacon of visionary leadership and
of Directors unwavering commitment.

As Chief Strategy Officer, I am honored to share our journey in this

Sustainability Report—a journey defined by ambition, action, and an

15%
unyielding dedication to our core principles, all fortified by robust
governance.
Women in Senior
Leadership Team Guided by Our Principles

At the heart of our sustainability journey lies a set of guiding

principles that steer our actions:

20%
Group emission intensity
Economic Resilience: We believe that sustainability is synonymous
with resilience. We pursue strategies that enhance long-term
reduction in FY2023 economic viability while mitigating risks.
compared to FY2022
Environmental Responsibility: We recognise our duty as
custodians of the environment, going beyond mere compliance to
9.0mm actively reduce our ecological impact and safeguard the planet for
future generations.
Average diameter of
trees at Wasco Forest
at present, indicating Social Equity: Sustainability extends beyond environmental
good growth rate concerns; it encompasses people too. We champion social equity,
diversity, and inclusion within our workforce and the communities
we serve.

Governance: Integrity, transparency, and accountability form the

6,665 MWh bedrock of our governance framework. Ethical practices, rigorous
Electricity save through risk management, and stakeholder engagement are central to our
renewable energy operations, fostering trust and collaboration.

46 Integrated Annual Report 2023

 Sustainability Report

Our Transformative Journey

This year, our journey has been transformative:

Pioneering Empowering Innovating for

Environmental Through Diversity Economic Governance Enhanced
Pioneering
Leadership: Empowering
and Inclusion: Innovating for
Sustainability: Excellence: Disclosures:
Environmental Through Diversity Economic Governance Enhanced
Leadership: and Inclusion: Sustainability: Excellence: Disclosures:
We have achieved Elevating female We are integrating Our governance Our commitment to
a 20% reduction in representation to sustainability into model ensures the transparency and
GHGhave
We emissions
achieved 15% in Senior
Elevating female our are
We economic
integrating highest
Our integrity
governance reporting
Our commitment to
intensity and
a 20% reduction in Leadership Team
representation to framework, setting
sustainability into across operations,
model ensures the sustainability
transparency and
expanded
GHG the
emissions and engaging
15% in Senior in neweconomic
our industry with rigorous
highest risk
integrity indicators has not
reporting
Wasco Forest,
intensity and comprehensive
Leadership Team standards for
framework, setting management
across and
operations, only strengthened
sustainability
demonstrating
expanded the our community
and engaging in resilience.
new industry transparent
with rigorous risk stakeholder
indicators has trust
not
commitment
Wasco to
Forest, development
comprehensive standards for stakeholder and
management but has
only also
strengthened
biodiversity andour
demonstrating programmes
community resilience. engagement.
transparent resulted in trust
stakeholder
global conservation
commitment to underscore
development our stakeholder improved
but has alsoscores
efforts.
biodiversity and dedication
programmes social
to engagement. for our FTSE4Good
resulted in
global conservation equity.
underscore our ESG ratingscores
improved in 2023.
efforts. dedication to social Furthermore,
for our FTSE4Good
equity. believing
ESG ratinginin 2023.
continual
Furthermore,
improvement,
believing in we
have voluntarily
continual
conducted internal
improvement, we
audit voluntarily
have assurance for
selected
conducted scope of
internal
our Sustainability
audit assurance for
KPI disclosure.
selected scope of
our Sustainability
Looking Forward KPI disclosure.

Accelerating
Our Fostering
vision for the future is ambitious and purpose-driven: Enhancing
Renewable Gender Diversity, Championing the Biodiversity and
Accelerating
Energy Fostering
Equity, and Circular Enhancing
Ecosystem
Renewable
Integration: Gender Diversity,
Inclusion: Championing
Economy: the Biodiversity
Restoration: and
Energy Equity, and Circular Ecosystem
Integration: Inclusion: Economy: Restoration:
We aim for a 30% We aspire for We are committed Our efforts in
reliance on women to hold at to waste reduction biodiversity
renewable
We aim for energy
a 30% leastaspire
We 30% of for and are
We recycling,
committed conservation
Our efforts in
by 2024,on
reliance reducing leadership
women to hold at embodying our
to waste reduction reflect our
biodiversity
our carbon energy
renewable positions,
least 30% of dedication
and to
recycling, commitment to
conservation
footprint
by 2024, and
reducing recognising the
leadership sustainable our
embodying growth. preserving
reflect our natural
leading sustainable
our carbon value of diverse
positions, dedication to habitats
commitmentand to
energy practices.
footprint and perspectivesthe
recognising in sustainable growth. contributingnatural
preserving to
leading sustainable drivingofinnovation
value diverse global biodiversity.
habitats and
energy practices. and sustainable
perspectives in contributing to
growth.
driving innovation global biodiversity.
and sustainable
growth.

Top

4.0 25%Top

4.0
FTSE Russell
ESG Score
25%
by ESG Ratings amongst 237 PLCs in FBM EMAS
that have been assessed by FTSE Russell.
FTSE Russell by ESG Ratings amongst 237 PLCs in FBM EMAS
ESG Score that have been assessed by FTSE Russell.
Wasco Berhad
22% 15% 20% 47

22%
Women Board
of Directors
15%
Women in Senior
Leadership Team
20%
Group emission intensity reduction
in FY2023 compared to FY2022
Sustainability Report

An Invitation to Join Our Legacy

We invite you to join us on this transformative journey

towards a sustainable, resilient, and equitable future.
Together, supported by strong governance and stakeholder
collaboration, we can make a meaningful impact.

Our dedication to continuous improvement and transparency

remains steadfast, ensuring that the insights and
achievements shared in this report are reflective of our
most current efforts up to 2023. We pledge to uphold this
standard of openness and accountability as we advance in
our sustainability journey.

Thank you for your continued trust and partnership.

Ariesza Noor
Chief Strategy Officer
Wasco Berhad

Note: The information provided in this report is based on data available up to 2023.
We remain committed to continuous improvement and transparency.

48 Integrated Annual Report 2023

 Sustainability Report

About This Report

Wasco Berhad (“Wasco or the Group”) recognises its responsibility to all stakeholders and is committed to
reporting its environmental, social and governance performance regularly and transparently.

This Sustainability Report (“SR”) communicates material sustainability information and performance across
Wasco’s business operations as a whole.

This Report covers the reporting period for the financial year 1 January to 31 December 2023. It provides
an insight into how the Group manages its material sustainability risks, issues and opportunities to create
economic, environmental and social value.

The SR is published annually as part of the Annual Report, with this Report published in April 2024. Our last SR
was published in April 2023.

Policy documents mentioned in this report are available on the Company’s website at www.wascoenergy.com.

Framework and Standards

This Report and its content have been prepared with reference to and guided by recognised global and local
sustainability reporting frameworks, standards and guidelines as follows:

• Bursa Malaysia Main Market Listing Requirements on sustainability reporting

• Bursa Malaysia Sustainability Reporting Guide (3rd edition)
• Global Reporting Initiative (“GRI”) Universal Standards 2021
• United Nations (“UN”) Sustainable Development Goals (“SDGs”)
• Greenhouse Gas (“GHG”) Protocol
• UN Global Compact’s (“UNGC”) 10 Principles

In addition, our disclosures were guided by relevant performance indicators from FTSE4Good Bursa Malaysia.

Wasco Berhad 49
Sustainability Report

Reporting Scope and Boundaries

The scope of the SR for FY2023 covers the entire Wasco organisation and its subsidiaries. One notable
inclusion for this reporting period is our new project site in Tanzania.

Wasco reports on an ‘operational control’ basis, focusing on assets, offices and activities where Wasco is the
operator and has management control over policies and practices. We note that our Business Units’ (“BUs”)
operating environment may vary from one market to the next, but we have nevertheless made the attempt to
harmonise general reporting areas, as well as highlighting the achievements of our specific BUs throughout the
disclosure.

This SR excludes our Joint Venture (“JV”) companies and discontinued operations Syn Tai Hung Trading Sdn Bhd
and WDG Resources Sdn Bhd.

Reporting Principles

This statement summarises the sustainability performance of Wasco’s strategic businesses. In defining the
content, the following GRI Standards Reporting Principles have been applied in this Report to ensure high-
quality disclosure.

• Accuracy: Reporting information that is correct and sufficiently detailed to allow an assessment of the
organisation’s impacts
• Balance: Reporting information in an unbiased way and provide a fair representation of the organisation’s
negative and positive impacts
• Clarity: Presenting information in a way that is accessible and understandable
• Comparability: Selecting, compiling, and reporting information consistently to enable an analysis of
changes in the organisation’s impacts over time and an analysis of these impacts relative to those of other
organisations
• Completeness: Providing sufficient information to enable an assessment of the organisation’s impacts
during the reporting period
• Sustainability Context: Reporting information about its impacts in the wider context of sustainable
development
• Timeliness: Reporting information on a regular schedule and making it available in time for information
users to make decisions
• Verifiability: Gathering, recording, compiling, and analysing information in such a way that the information
can be examined to establish its quality

Wasco developed the content according to defined material topics following a review of the overall sustainability
risks and opportunities determined by macroeconomic analysis, sustainability trends, and senior management
input. Stakeholders’ views, concerns and key expectations also shaped the materiality assessment. This
assessment helped the Board realign the Group’s sustainability strategy while ensuring the transparent coverage
of critical topics.

Forward-Looking Statements

Certain statements in this SR may constitute forward-looking statements concerning our financial and non-
financial position, future priorities, strategies, and growth opportunities. They are formed based on reasonable
assumptions and are not intended to guarantee future results. Actual results could differ materially from those
projected in any forward-looking statements throughout this SR due to various events, risks, uncertainties, and
other factors.

50 Integrated Annual Report 2023

 Sustainability Report

Sustainability Data and Disclosure

Wasco’s management and dedicated internal resources reviewed the completeness and accuracy of the data
and information. The senior leadership team oversaw the statement’s preparation, assembly, and drafting,
complementing the significant internal and data-collection resources to ensure accuracy.

Assurance

Wasco’s Group Internal Audit provided an independent limited assurance for three key Environmental, Social and
Governance (“ESG”) indicators as below:

• GRI 205: Business Ethics and Compliance – Anti Bribery and Corruption and Whistleblowing
• GRI 404: Training and Development
• GRI 405 & 406: Diversity, Equal Opportunity, and Non-Discrimination

For more information on the subject matter and scope of assurance, please refer to the Statement of Assurance
on page 91.

Sustainability Report Feedback

Feedback from our stakeholders is vital for us to continually improve our reporting and sustainability practices.
We welcome all feedback and views from our stakeholders on this Report or any aspect of our sustainability
performance.

Please address all feedback to Group Sustainability: [email protected]

Wasco Berhad 51
Sustainability Report

Sustainability Across Our Operations

Wasco delivers sustainable value for all stakeholders safely, securely and in an environmentally and socially
responsible manner by:

• Reducing the environmental footprint through the life cycle developments; and
• Bringing social and economic benefits for people associated with business operations in line with Wasco’s
shared values.

Wasco integrates sustainability throughout the business on three levels.

In company • running a safe, efficient

operations and profitable business

• meeting expectations
For our
customers
and d e l i ve r i n g our
commitments

• sharing benefits wherever

With
communities
we operate and making
positive contributions

52 Integrated Annual Report 2023

 Sustainability Report

Sustainability Policy

At Wasco, sustainability is about delivering value for all our stakeholders in a responsible manner,
balancing short and long-term interests that integrates economic, environment and social considerations
into our business strategy. Wherever possible, we will implement and maintain accredited management
systems for corporate sustainability to drive performance and improvement by focusing on our business
processes, our culture, and our digital agenda – all underpinned by a strong governance structure.

To achieve these goals we will;

• Ensure that our safety values remain a top priority, ensuring that nobody gets hurt, no damage to
property and no harm to the environment.
• Generate financial gains aligned to the needs of our stakeholders.
• Employ a diverse workforce and provide a work environment where everyone is treated fairly, with respect,
avoid excessive working hours, given the right to a minimum wage and can realise their full potential.
• Implement actions within our own business and other stakeholders to accelerate the transition to net-
zero emissions to reduce the impact of climate change.
• Manage our businesses efficiently through embracing digitalisation and innovation.
• Conduct our business in an ethical and transparent manner.
• Safeguard human rights within our sphere of influence, opposing all forms of child labour and forced
labour.
• Support employment of underprivileged groups and youth.
• Contribute to the well-being of local communities wherever we operate.
• Periodically review our performance and implement appropriate actions for continuous improvement.

In implementing this Policy, we will support and advance the United Nation’s Sustainable Development Goals
focusing our efforts on those that align with our aims in order to make the most impactful contribution.

We will engage with our employees, contractors, suppliers, customers, and business partners in sharing
responsibility for meeting these goals.

ESG considerations are integrated into our corporate strategy and sustainability approach to ensure long-term
value creation and sustainable business growth. We periodically review our approach to sustainability and
priorities to meet stakeholders’ growing expectations and incorporate value creation.

Our Sustainability Framework supports our commitment to making sustainability core to our business and
managing what matters where it matters most. This is in line with the increasing demand for corporate
organisations to play a more active role by focusing their business on ESG and thinking beyond short-term profits.

Guided by our purpose, the Sustainability Framework was developed by taking into consideration the different
levels of maturities across the Group and global push for ESG. The process included assessing existing
sustainability programmes and initiatives, considering changes in regulatory requirements and defining targets
and goals to measure impacts.

The following factors were taken into consideration:

1. Wasco’s material matters founded through materiality assessment conducted with our Board of Directors,
Senior Leadership Team members and stakeholders.
2. Regular engagement with Business Units on pertinent sustainability issues.
3. Internal assessment and benchmarking against industry peers.
4. Monitoring and tracking of key performance indicators.

Additionally, our Framework takes into consideration the global agenda to achieve a better and more sustainable
future for all through the UN Sustainable Development Goals (“UN SDGs”), which aim to leave no one behind.

Wasco Berhad 53
Sustainability Report

Our United Nations Sustainable Development (“UN SDGs”) Alignment

The United Nations Sustainable Development (“UN SDGs”) are a set of 17 global goals established by the UN
General Assembly in 2015 to make the world a better place by 2030. The goals intend to end poverty, protect
the planet and ensure prosperity for all. Wasco is aligned with the UNSDGs and committed to contributing to
their framework to enhance sustainable initiatives. The Group also calls on all its partners across the business to
collaborate on achieving these goals.

While our activities touch on nine of the seventeen goals, we have identified four UNSDGs that impact our
sustainability strategy where we can make the most contributions in these areas.

Goals Our Commitment Progress and Achievements

• Provide a safe and healthy • All sites in the organisation either have been or are being
workplace for our staff and certified with the ISO 45001:2018 for Health & Safety and
contractors by embracing ISO 14001:2015 for the Environment.
internationally recognised HSE
Management Systems, namely • On-going implementation of i-Start initiative to enable a
ISO 45001:2018 for Health & safety culture transformation.
Safety and ISO 14001:2015 for
• Tracking leading and lagging KPIs and taking action for
the environment.
continuous improvement.
• Achieve Zero Lost-time Incidents
• Performing periodic inspections, audits, and safety
(“LTI”).
observations addresses gaps and prevents incidents.

• Launched Digital Care Card initiative, digitalising analysis of

safety observations and providing insights on potential safety
issues.

• Establish policies to promote • 15% of Senior Leadership Team are female.

gender equality in recruitment,
compensation, training, • Clearly articulating statements on equal opportunity and
promotion and work-life balance. non-discrimination in the Principles of Business Conduct and
Human Rights Statement.
• Eliminate sexual harassment,
violence, discrimination and
other harmful practices against
women in the workplace.

• Develop a high performing • Quarterly reviews for performance assessment and coaching.
entrepreneurial culture (culture
of curiosity) in the Company • Talent development through regular training and digital
where all staff give their best. learning platform.

• Develop leaders at all levels • High retention of senior management.

of the Company and create a
• Annual performance appraisals for compensation and
learning and coaching mindset
promotion.
amongst all staff.

• Reduce emissions by improving • Tracking, analysing and reporting of Group greenhouse gas
energy efficiency, transitioning emissions (“GHG”) using digital dashboard developed internally.
to renewable energy such as
solar power and offsetting • Completed planting 160,000 trees and on-going maintenance
residual emissions through in- of our reforestation programme as part of our effort to
house programmes such as tree mitigate climate change.
planting.
• Subscribed to 500,000 kWH/month Green Energy Tariff by
TNB.

• Solar panels at various sites generated 698MWh of renewable

energy for our operation’s use.

54 Integrated Annual Report 2023

 Sustainability Report

Sustainability Governance & Accountability

Sustainability Governance

To effectively implement sustainability strategies and initiatives across our organisation, we focused on building
close collaborations between Management and Business Units. We will continue to regularly review and
enhance, where necessary, the roles and responsibilities of the relevant Wasco functions to support a holistic
WASCO
approach towards managing our sustainability performance and the credibility of GROUP
our programmes and activities.
Board Level Board of directors
WASCO GROUP
� Overall Strategic responsibility and
oversight
Board Level Board of
Governance, Compliance directors
and Risk Committee (“GCRC”)
� Overall Strategic responsibility and
oversight Governance, Compliance and Risk Committee (“GCRC”)
Management Level Wasco Sustainability Steering Committee (“SSC”)

� Overall management responsibility and

alignment across
Management Level the Group Wasco Sustainability Steering Committee (“SSC”)

� Overall management responsibility and

alignment
Working Levelacross the Group Group Sustainability (“GS”)

� Operational responsibility and strategic

implementation
Working Level Group Sustainability
Business Unit (“GS”)
� Operational responsibility and strategic
implementation Business Unit
Economic Environment Social Governance
� Operational � Environmental � People & Social � Risk Management
Excellence
Economic stewardship
Environment Performance
Social � Business Continuity
Governance
� Circular economy � Occupational Health Management
� Operational � Environmental
Climate change � People & Social
& Safety � Risk Management
Excellence stewardship
management Performance � Business Continuity
� Circular economy � Occupational Health Management
� Climate change & Safety
management
Roles & Responsibilities
Roles & Responsibilities
Roles & Responsibilities
Governance, Compliance and Risk Committee Quarterly Board of Directors
(“GCRC”) Reporting
Provide oversight of the integration of ESG matters
Governance,
Provides Compliance
direction and Risk
and reviews Committee
all decisions Quarterly in corporateBoard ofwith
strategy Directors
the aim of balancing
(“GCRC”)
pertaining to sustainability Reporting stakeholder interests, create long term value
Provide oversight of the integration of ESG matters
Provides direction and reviews all decisions in corporate strategy with the aim of balancing
pertaining to sustainability Quarterly stakeholder interests, create long term value
Reporting

Quarterly
Wasco Sustainability Steering Committee
Reporting Quarterly
(“SSC”) Reporting
Group Sustainability (“GS”)
Wasco Sustainability
Formulate Steering
sustainability Committee
strategy and monitor Quarterly
(“SSC”) and action plans Reporting � Consolidate, monitor and analyse
objectives Group Sustainability (“GS”)
sustainability reporting
Formulate sustainability strategy and monitor � Lead formulation of sustainability strategy,
Monthly � Consolidate,
objectives and monitor
actionand analyse
plans
objectives and action plans
Business Unit
Reporting sustainability
� Coordinate reporting
cross-department sustainability
� Lead formulation of sustainability strategy,
initiatives
� Reporting of sustainability-related KPIs objectives and actionperformance
plans
Business Unitsustainability-related risks and Monthly � Report sustainability
� Managing � Coordinate cross-department sustainability
opportunities Reporting
initiatives
� Reporting of sustainability-related KPIs
� Report sustainability performance
� Managing sustainability-related risks and
opportunities

Wasco Berhad 55
Sustainability Report

Board Level

Wasco’s Board holds ultimate responsibility of the Group’s sustainability agenda and provides oversight of the
integration of ESG matters in Wasco’s corporate strategy with the aim of balancing stakeholder interests while
ensuring that we grow responsibly and create long-term value.

Governance, Compliance and Risk Committee (“GCRC”)

The Governance, Compliance and Risk Committee (“GCRC”) was introduced in 2023 to provide enhanced Board
oversight on Sustainability issues across Wasco Group. This change underlines our top-down approach and
our commitment to embracing sustainability as a Group-wide agenda. The GCRC also has oversight of climate-
related matters, including climate risks and opportunities.

The members of GCRC comprises of a Non-Independent Non-Executive Director and two Independent Non-
Executive Director. The GCRC is chaired by an Independent Non-Executive Director.

The GCRC met two times in the year under review and among the matters discussed were:

• Reviewing Wasco’s sustainability performance and activities.

• Sustainability Report enhancement recommendation.
• TCFD adoption recommendation.

Management Level

The overall management responsibility and oversight of sustainability-related matters lies with our Managing
Director/Group CEO. The Managing Director/Group CEO is supported by the Group Chief Strategy Officer, who
oversees Group Sustainability, and other senior management within their areas of responsibility.

For accountability, sustainability-related KPIs are included in our Managing Director/Group CEO as well as
Business Unit’s Senior Leadership Teams (“SLTs”) annual remuneration-linked KPIs. All Business Units CEOs are
also authorised to sign off on sustainability-related governance as part of internal control assurance.

Working Level

Wasco Sustainability Steering Committee (“SSC”)

Chaired by the Managing Director/Group CEO, the SSC consists of representatives from Group Sustainability
(“GS”) and selected Heads or nominees from key Group corporate functions. The SSC is responsible for
supporting the management of ESG matters and ensuring collaboration to streamline the approach within the
Group and promote sharing.

56 Integrated Annual Report 2023

 Sustainability Report

Group Sustainability (“GS”)

GS leads the development of overall strategy and framework to drive sustainability initiatives and programmes
across the Group in a structured and cohesive way. Their responsibilities include monitoring and managing
business sustainability practices and targets, keeping abreast of the sustainability development landscape and
ensuring management of the Group’s Environmental, Social and Governance (“ESG”) risks and opportunities are
assessed and evaluated. The team also provides advisory support and capacity building for the sustainability
teams in all Business Units and receives sustainability progress updates.

Stakeholder Engagement
Long-term business success depends mainly on understanding and addressing stakeholders’ expectations.
Wasco engages with various stakeholder groups, including employees, customers, shareholders and investors,
regulators and authorities, vendors, suppliers and the media. We continually seek opportunities to speak
with stakeholders, understand their viewpoints and talk transparently about the business. The table below
summarises Wasco’s approach to stakeholder engagement.

Stakeholder Engagement Platform Areas of Interest Our Commitment

• Workplace meetings and employee • Equal opportunities Our employees are key to our
briefings • Diversity innovation-driven culture and
• Intranet and bulletins • Career progression we are committed to nurturing
• Townhall meetings • Benefits and their talent.
Employees • Employee surveys rewards
• MyGoals performance reviews

• Quality Certification Audits • Business growth We reinvent technology,

• Regulatory Site Visits and Audits • Risks and create new approaches and
• Social Media challenges conceive end-to-end solutions
• Official Website • Customer privacy for greater efficiency and
Customers • Marketing Events • Target, quality and capabilities.
• Customer Satisfaction Surveys delivery

• Annual and Quarterly Reports • Long-term We are committed to delivering

• Annual and Quarterly Results profitability economic value to our capital
Announcements • Sustainability providers through a robust
• Annual General Meeting (“AGM”) matters financial performance.
Shareholders • Extraordinary General Meeting • Company's
& Investors (“EGM”) performance
• Announcements on Bursa Malaysia • Compliance
• Investor relations section of the
Company's website
• Press release and coverage

• Emails/letters • Compliance We have established

• Dialogues with the authorities • Reducing the sustainability governance
• Workshops and training organised impact of to manage risk, ensure
by the relevant regulatory operations compliance and always
Regulators & authorities operate with integrity.
Authorities

• Negotiations with vendors/ • Fair procurement We maintain two-way

suppliers • Sustainable supply relationships with suppliers
• Supplier periodical performance chain management who follow our supplier code
evaluation • Long-term of conduct.
Vendors/ • New vendor evaluation and relationships
Suppliers registration

Wasco Berhad 57
Sustainability Report

Stakeholder Engagement Platform Areas of Interest Our Commitment

• Ongoing engagement sessions • Company's We continue to make the

and interviews performance and greatest possible difference
• AGM and EGM outlook through transparent and
• Press release and coverage • Business risks active engagement with media
Media • Press conference • Sustainability partners and interest groups.
matters

In company operations • running a safe, efficient and profitable business

Materiality Assessment
Materiality assessments are integral to our sustainability journey, as they enable us to evaluate the
Environmental, Social and Governance
For our customers • (“ESG”)
meetingissues that affect
expectations andour business
delivering and
our our stakeholders. We conduct
commitments
a materiality assessment once every two years to ensure that the ESG issues and material matters we look into
remain relevant and aligned with current sustainability trends, industry developments and regulatory shifts. It
also allows us to identify opportunities and mitigate risks posed by each material matter.

In 2023, we re-evaluated our ESG •material

With communities issues
sharing following
benefits the we
wherever consolidation
operate andofmaking
Business Units contributions
positive under Wasco
Berhad. Our material matters represent key sustainability issues that will affect our business strategy and
stakeholder value creation in the short and long term.

The following infographic explain the steps taken in our materiality assessment process.

PHASE 1 PHASE 2 PHASE 3 PHASE 4 PHASE 5

Review Stakeholder Sustainability Calibration of Review

Material Engagement Impact Stakeholder and
Matters Assessment Engagement Approvals
and Impact
Assessment

Existing material Inputs from A sustainability The results of After completing

matters were stakeholders’ impact stakeholder the materiality
reviewed against perspective were assessment was engagement and assessment
SASB Standards’ reviewed and conducted to the sustainability exercise, we
Common Material assessed (based assess and impact presented the
Matters for the on engagement prioritise the assessment were materiality matrix
industry we conducted in material matters. consolidated into to Wasco’s
operate in and FY2023). a materiality Management
Wasco’s business matrix. From this Team and the
strategies and matrix, we Board for
operations to identified the top approval.
ensure relevance material matters.
to our business
and stakeholders.

Shareholders Employees Media Customers Vendors/ Regulators

and Investors Suppliers and Authorities
58 Integrated Annual Report 2023
 Sustainability Report

Stakeholder Groups Participating in the Survey

Shareholders Employees Media Customers Vendors/ Regulators

and Investors Suppliers and Authorities

The survey asked stakeholder representatives to rate the importance they placed on 18 areas of sustainability.

We asked respondents to indicate how important each criterion was on a scale of ‘very unimportant’ (1) to
‘very important’ (5). We employed a 5-point Likert Symmetric Scale so respondents could specify their level of
agreement with (3) being neutral.

We discovered a natural skew in the results as each stakeholder group was not represented equally.
Unsurprisingly, we received the most responses from our employees and the fewest from Regulators &
Authorities and Media.

We calculated an average score for all areas within each stakeholder group to rectify the sample imbalance. An
average rating from all eight stakeholder groups was then obtained.

We also asked members of our Senior Leadership Team and Board to complete the survey. Their views
represented Wasco.

Materiality Matrix

Scores over 3 were considered of medium importance. Stakeholder scores ranged from 4.06 to 4.74; Wasco’s
between 3.69 and 4.77, indicating that all issues were material to some degree. A material to very material
scale was adopted as even the lowest scores fell into the important category. The matrix is presented in the
following diagram.

High
1
Legend
1 Health, Safety and Environment
2 Product Quality
3 Labour Pratice
4 Human Rights
Importance to Stakeholder

5 Waste Management
3 2
6 Training & Development
4
5 7 Diversity, Equity and Inclusion
7
6 8 Business Ethics
9 Risk Management
8 10 Product Design
9 11 Business Model Resilience
10
12 11 12 Energy Management
14 13 Greenhouse Gas
13
14 Water
17 16 15 15 Economic
16 Material Sourcing
17 Supply Chain
18 18 Physical Impact of Climate Change
Low
Low High
Relevance to Wasco

Health, Safety and Environment remained as the top material matter to Wasco, as well as to stakeholders. Apart
from that, our stakeholders placed Product Quality, Labour Practice, Human Rights, Waste Management, Training
& Development and Diversity, Equity and Inclusion as top material matters that the Group will need to prioritise.

2012 2013 2014 2019 2021 2023

Wasco
• GHG Berhad
Gas • Capacity • Inclusion of • Corporate • Launching of • Continue 59
Emissions building, carbon Sustainability Operational implementation
verified by tracking footprint reiterates Net Zero of Group's
Bureau and reduction commitment Emissions Emissions
Sustainability Report

Integrity, Compliance, Assurance and Reporting Concerns

Wasco’s commitment in ensuring that integrity and compliance are observed in the day-to- day business
operations, are pillars to a sustainable foundation of our culture and a business priority. We set high
expectations to all our employees as outlined in our Principles of Business Conduct. These vital values of
integrity and compliance are the fundamentals to good governance.

Anti-Bribery and Corruption

Wasco’s Anti-Bribery and Corruption Policy (“ABC Policy”) and Anti-Bribery and Corruption Management
System (“ABMS”) together with its 24 Standard Operating Procedures (“24 SOPs”) established on 1 June 2020
and 1 December 2020 respectively are testimony of the Company’s initiatives and commitment towards an
organisation that are integrity and compliant oriented. These fundamentals have been deeply rooted into the
business perspective and in its corporate culture. Wasco adopted a zero-tolerance approach against all forms
of bribery and corruption, such as fraud and illegal kickbacks. Wasco’s ABC Policy sets the tone and standards
on anti-bribery and corruption across the Group while the ABMS together with its 24 SOPs communicate its
comprehensive approaches and processes in deterring, mitigating and addressing corruption risks including
bribery, fraud and corrupt acts. Wasco’s ABMS and its 24 SOPS are aligned to SIRIM ISO 37001:2016 standards
and are the best practices as prescribed under Section 17A of the Malaysian Anti-Corruption Commission Act
2009 (Amendment 2018) (“MACC Act”). Wasco’s ABC Policy fulfils the provisions of the Guidelines on Adequate
Procedures pursuant to Section 17A (5) of the MACC Act.

Coverage of ABC

Directors Employees Vendors Contractors Sub-contractors

Consultants Clients Customers Representatives

Business associates Other intermediaries performing works or services,

(including joint venture and consortium partners) for and on-behalf of Wasco

The ABC Policy applies to the Board of Directors and employees within Wasco. They have all completed the
necessary initial training on anti-bribery and corruption as well as yearly refresher trainings pertaining to the
same.

The Board of Directors oversees our compliance with ABC Policy and the ABMS together with its 24 SOPS via
the Governance, Compliance and Risk Committee and the Integrity Committee accordingly. Every employee
is responsible for preventing and reporting instances of corruption, bribery, suspicious activity or wrongdoing
which may lead to bribery and corruption using our established whistleblowing channels.

Wasco recorded zero case related to bribery and corruption and received no (RM0) penalties due to ethical
conduct breaches such as corruption during the year under review.

A keen understanding of corruption risk exposure is the foundation of an effective anti-corruption compliance
programme. Corruption risks, including bribery, are important elements in the Business Units’ risk register. This
keen understanding helps the Company design effective mitigation strategies and strategically deploy resources
to combat potential bribery, corruption and fraud, especially for high-risk operations.

60 Integrated Annual Report 2023

 Sustainability Report

Contractors, subcontractors and third parties are subject to corruption and bribery risk assessments and
must declare they are not involved in any misconduct or corrupt, unethical and illegal behaviour. Wasco
communicates its anti-corruption policy clearly to these intermediaries.

• Employees are given an introduction to our anti-bribery and corruption policy

upon joining the Company.
Communicating
our Company’s • Each employee must sign the ABC Personnel Declaration and return to the Human
position on Resources Department.
anti-bribery and • Employees are reminded of our Company’s opposition to corruption during regular
corruption to all
engagement sessions and training via iLearn
stakeholders
• The anti-corruption policy is also communicated to suppliers, contractors,
subcontractors, agents, joint venture companies and third parties.
The Group also screens new and existing business partners for corruption and bribery, which is part of due
diligence in Wasco’s compliance requirements.

Business books and records reflect all business dealings accurately and transparently. Wasco introduced
monitoring and enforcement procedures to ensure compliance with anti-corruption laws in Malaysia. Wasco did
not make any political contributions in 2023 (RM0).

No major disciplinary cases were reported for corrupt practices that resulted in employees’ dismissal. There
were no instances of corruption-related violations with our business associates. We have received zero fines
and penalties from the authorities during the recent years and reporting period, which demonstrates the
effectiveness of our stringent anti-corruption policies and practices.

Whistleblowing

Wasco’s whistleblowing policy applies to all employees and external parties who have business relationships
with the Group. Our Whistleblowing Policy is aligned with the ISO 37001:2016 Clause 8.9 Raising Concern.
Individuals raising concerns or reporting possible violations of the Code of Conduct in good faith are:

• Protected from any forms of retaliation; and

• Treated with the utmost confidentiality.

Whistle-blowers are encouraged to raise their concerns and report to the Group Chief Executive Officer, Gian
Carlo Maccagno or to the Chairman of Audit Committee, Datin Wan Daneena Liza Binti Wan Abdul Rahman,
confidentially. Senior officers have been trained to handle these reports, corruption, harassment, bribery,
financial irregularity and other offences.

Wasco Berhad 61
Sustainability Report

Economic
As a global leading integrated energy group, we take responsibility to power global and local economies
seriously. We are a critical part of the world’s energy infrastructure, and we believe in lowering barriers to clean,
affordable energy for everyone, everywhere.

In 2023, our Company generated a direct economic value of RM 2.606 Billion in revenue. Our economic impact
also extends to our role as a global employer. At the end of 2023, we employed approximately 5,752 employees
and offered fair and competitive wages and benefits. Developing a diverse global workforce helps bring
innovative and sustainable solutions to the market, contributing towards the future of energy transition.

Supporting Sustainable Economic Growth and Development Through Our Operations

Wasco has been a leading integrated energy group that operates globally, providing comprehensive technical
services primarily to the oil and gas sectors worldwide. Increasingly, we leverage on our expertise to contribute
to the advancement of other industries such as carbon capture and storage pipelines, wind-offshore, data
centers and renewable energy.

Pipeline Services
Wasco is a recognised market leader in pipe coating, manufacturing
spiral welded steel pipes and providing offshore corrosion control
system. We have a global operations strategically serving the energy
industry and have coated over 22,000km of pipelines across 25
countries.

Engineering and Fabrication Services

Wasco provides an all-encompassing solution covering Engineering,
Procurement and Construction (“EPC”) project delivery and offering
modular fabrication solutions for the global energy industry. Our
fabrication facilities are strategically located in Southeast Asia
and the Middle East & Africa. We invested in world-class facilities
featuring fully concreted waterfront fabrication base in the
Southeast Asia FT zone, spanning over 34 hectares and equipped
with a dedicated jetty for loading modules up to 10,000 tonnes. This
enables us to adapt our expertise to fabricate for renewables.

Bioenergy Services
Wasco is the largest fabricator of steam biomas turbines and boilers,
serving 70% of the agro industry. Our high-capacity boilers run
on clean energy, including biomass and natural gas, contributing
to eco-friendly solutions. In addition, our Heat Recovery System
Generator technology achieves 80%+ efficiency, reducing carbon
footprint for industrial clients.

62 Integrated Annual Report 2023

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Participating in Industry Organisations

Wasco proactively engages with other leading companies and organisations to help advance standards,
share best practices, activate stakeholders, and create a sustainable economy. Wasco continues to work
with leading organisations, namely the Malaysian Oil & Gas Services Council (“MOGSC”), the largest national-
level independent industry association promoted and driven by the services sector of the Malaysian Oil & Gas
Industry. In addition, we are an active member of Energy Industries Council (“EIC”), one of the world’s largest
energy trade associations for companies that supply goods and services to the energy industries worldwide.

Responsible Procurement

Our supply chain includes the supply of goods and services. We strive to improve our supply chain’s social
and ethical footprint and work with suppliers that share our values. We expect our suppliers to comply with all
applicable laws and demonstrate that they have the attributes set out in our Supplier Code.

We recognise the opportunity to positively impact communities by making balanced choices about sourcing the
required goods and services for business operations. Our responsible procurement plan focuses on four key areas:

• Upholding ethical treatment of workers

• Supporting local businesses
• Encouraging participation
• Assessing supply chain risk management

We conduct quantitative and qualitative assessments of all suppliers on our Approved Vendor List every year.
Our selection is based on Major and Minor Vendors categories. We examine their performance to mitigate risks
and drive improvement during the review. We notify poor performing suppliers and provide corrective action or
improvements. The vendor may be suspended or removed from the Approved Vendor List if they do not take the
requested action or make the necessary improvements. Wasco updates the Supplier Audit Matrix following the
yearly assessment.

Wasco Berhad 63
Sustainability Report

Environmental & Climate Change

Wasco’s commitment to practising environmental sustainability is a continuous process. We align our
environmental policy and practices with environmental laws and legislations, including strategies to prevent
pollution, minimise waste and conserve natural resources where we operate. We received no environmental
fines and penalties during the year.

Wasco is committed to providing high-quality services that protect and improve the environment. 54% of
our Environmental Management System is ISO14001 certified as of 2023.

Our Approach

Conduct a comprehensive assessment of environmental issues directly related to

Environmental our operations. This evaluation will identify key areas where our activities impact the
Assessment environment, such as resource consumption, emissions, water consumption and waste
generation.

Establish robust tracking and monitoring routines to collect relevant data. This information
Data-Driven
will serve as the foundation for developing measurable targets. By tracking our
Tracking and
Monitoring environmental performance consistently, we can make informed decisions and measure
progress effectively.

Strategic Develop data-driven strategies and action plans aimed at minimising our environmental
Planning footprint. These strategies address critical aspects like energy efficiency, emission
for Impact reduction waste reduction, and sustainable sourcing. By aligning our efforts with empirical
Reduction data, we can achieve maximum impact in our sustainability initiatives.

Transparent Regularly report our progress to senior management and the Board. These reports
Reporting highlights the implementation of our strategies, their effectiveness, and any adjustments
to made based on data insights. Transparency ensures accountability and encourages
Leadership continuous improvement.

The team works closely with clients, contractors, the community, industry, and the State and Federal
Governments to establish procedures so staff can positively contribute to innovative and cost-effective
environmental outcomes.

Continually improve our awareness and management of environmental risks to avoid,

reduce and control pollution from our operations

Promote the open exchange of environmental information with our customers, suppliers
and the community to improve environmental awareness and to obtain feedback on or
Wasco’s
Environmental
environmental performance
Commitment
Identify and comply with environmental legislation, regulation and license standards for all
our operations and environmentally relevant activities

Promote waste minimisation, energy management and greenhouse gas emissions within
our day-to-day operations

64 Integrated Annual Report 2023

 Sustainability Report

Energy Management

Wasco is committed to addressing energy use and efficiency by:

• Adhering to relevant legislation and regulations concerning energy

• Improving and promoting energy efficiency by implementing effective energy management programmes
throughout the organisation
• Communicating with employees, government agencies and the community on energy management
• Identifying, implementing and developing measurable targets for energy conservation projects
• Conserving energy resources through best practices and integrating energy management in business
activities

Our Group-wide energy consumption for the past three years is presented below.

27,028,386
High
1
Legend
1 Health, Safety and Environment

23,860,629
30,000,000 2 Product Quality
3 Labour Pratice
4 Human Rights
Importance to Stakeholder

25,000,000 3 2
5 Waste Management
6 Training & Development
4
14,070,318
Electricity (kWh)

5 7 Diversity, Equity and Inclusion

7
20,000,000 6 8 Business Ethics
9 Risk Management
8 10 Product Design
15,000,000 10
9 11 Business Model Resilience
12 11 12 Energy Management
14 13 Greenhouse Gas
13
10,000,000 14 Water
17 16 15 15 Economic
16 Material Sourcing
5,000,000 17 Supply Chain
18 18 Physical Impact of Climate Change
Low
Low
0 High
2021*

2022

2023

Relevance to Wasco

Note: Data for 2022 and 2023 encompasses all entities in Wasco. Data for 2021 were scoped to Wasco’s Energy Division only.

Our Journey Towards Operational Net Zero Emissions

14,060

20,000 15,000
2012 2013 2014 2019 2021 2023
15,452

11,008
14,216

12,000
15,000
CO2e Emissions

• GHG Gas • Capacity • Inclusion of • Corporate • Launching of • Continue

8,719
CO2e Emissions

Emissions building, carbon Sustainability9,000 Operational implementation

(tonnes)

(tonnes)

verified by
10,000 tracking footprint reiterates Net Zero of Group's
Bureau and reduction commitment6,000 Emissions Emissions
4,880

Veritas reporting commitment on emissions Plan with Reduction

5,000 of emissions in the reduction in target set Plan.
3,000
Corporate line with Goal for 2026
Sustainability 13 of the
0 Policy UNSDGs - 0
2021*

2022

2023

2021*

2022

2023

Climate Action

• Implementation
of the Group
Emissions
Reduction Plan
35,000 2.50
2.29 2.30
29,512

30,000
25,225

2.00
1.88
e Emissions

25,000
Wasco Berhad 65
(tonnes)

 20,000
    1.50
99
2
Sustainability Report

Greenhouse Gas Emissions Management

Climate change remains one of the most significant challenges facing society. As a leading energy company,
embedding the climate transition in our strategy is key to delivering our mission and vision.

We unequivocally support the United Nations Framework Convention on Climate Change and the Paris
Agreement and measures to progressively reduce global emissions, including the aim to limit the world’s
temperature increase to 1.5°C above pre-industrial levels.

In an effort to reduce our emissions impact, we are currently updating our emissions reduction targets to be
consistent with a 1.5°C pathway. We aim to achieve net-zero Scope 1 and Scope 2 emissions by 2026.

Scope Principal Means Initiatives identified and Targets

of Emissions implemented
Reduction

Scope 1 Reducing waste, • Phasing out use of diesel fuelled air Target to reduce
improving energy compressors and power generators emission intensity
Coverage: entire Group efficiency and in all operations. from stationary
(100%) using lower- • Mobile tower light powered by solar combustion by
• Stationary combustion carbon fuels and battery instead of diesel. 5%.
• Company-owned • Using natural gas for all burners
vehicles • Minimising the use of LPG Achieved 12%
• Refrigerant leakage • The "Benefit of Walking" Campaign reduction
• Fire suppression encourages personnel to walk in emission
• Welding instead of using vehicles intensity from
• Optimising fuel use by periodically stationary
maintaining and servicing the plant combustion.
and equipment
• Using Euro 6 standard vehicles,
which are energy efficient and limit
harmful exhaust emissions
• Using arc welding

Scope 2 Increasing energy • Energy Saving Awareness Campaign Target 25%

efficiency and • Using hibernation features for all of Group’s
Coverage: entire Group using electricity computers energy mix
(100%) from renewable • Installing timers/sensors for lighting, from renewable
- Purchased electricity sources air conditioners, hydraulic power sources.
packs and blowers
• Replacing malfunctioning bulbs with Achieved target
LED lights of 25%.
• Installing solar power system at
production facilities.

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 Sustainability Report

Forests Alone Cannot Handle Carbon: Balancing Nature’s Role in Climate Change

Facts: Nature has garnered significant attention for its remarkable ability to remove carbon dioxide
(“CO2”) from the atmosphere and sequester it within the biosphere. This natural process occurs through
photosynthesis, involving soils, grasslands, trees, and mangroves. However, nature is not only a carbon
sink; it also contributes to carbon dioxide emissions due to deforestation, land degradation, ecosystem
disruption, and agricultural practices. Fortunately, strategic changes in land management practices can
mitigate emissions and enhance carbon storage.

Solutions: The urgency of achieving net-zero emissions to safeguard our climate is undeniable. A pivotal
strategy relies on tree planting—the most impactful and cost-effective method to extract CO2 from the
atmosphere. Net-zero initiatives hinge on maximising the carbon uptake capacity of these trees beyond
their existing absorption rates.

During this past year, we continued maintenance activities for the 160,000 trees planted in Wasco Forest phase
one. Third party consultants were engaged to track and monitor the growth of Wasco Forest. We are pleased to
share that our forest is healthy and growing well. This sentiment is shared by Pahang Forestry Department, who
has granted an additional 670 hectares of land in Maran for us to continue our reforestation efforts.

Wasco Berhad 67
Sustainability Report

Managing Climate Change Risks and Opportunities

Wasco’s commitment to producing in a way that helps protect people, the environment and the communities
where it operates includes mitigating the risks of climate change. We recognise the devastating effects and
associated short- and long-term business risks that climate change presents. Wasco is committed to addressing
this issue and to avoid the impact of climate change by improving the efficiency of our operations. Our climate
change strategy includes working with employees and supply chain partners on energy-saving processes and a
complete climate change risk assessment.

The Group’s greenhouse gas (“GHG”) inventory is tracked on a monthly basis via a dashboard that we
developed internally. From the dashboard, metrics such as emission intensity, top GHG emission source and
more are analysed and inform our GHG reduction strategies. Through the Sustainability Steering Committee,
our management team devises strategies to manage and minimise our environmental footprint. The senior
management team, along with the respective Heads of Business Units (“BUs”), regularly review GHG emission
data on a monthly basis and effectively execute GHG reduction plans. Additionally, the Board receives quarterly
updates on the Group’s progress in this regard.

Climate-related risks and opportunities are identified, assessed and managed using Wasco’s Risk Management
Framework in the same way as all other risks. The Board and senior management consider, review and monitor
climate-related risks and opportunities as part of our strategic planning process, investment decisions, and
regular financial and operational performance reviews throughout the year.

Risks Opportunities

Regulatory and Policy Risks Energy Transition Services

• Changes in environmental regulations and • Diversify by offering services related to renewable
policies can impact operations, compliance energy, carbon capture, and energy efficiency.
costs, and market access. • Support clients in transitioning to cleaner technologies.
• Climate change related disclosures and
regulations that could impact our regulatory
reporting.

Market Risks Market Opportunities

• As the world shifts toward cleaner energy • Positive differentiation in the market for long-term value
sources, demand for oil and gas services creation for the benefit of stakeholders.
may decline.
• Fluctuations in oil and gas prices can affect
project viability and revenue.

Operational Risks Innovation and Technology

• Extreme weather events (e.g., floods, • Develop and provide innovative solutions for emissions
extreme heat) can disrupt operations, reduction, digitalisation, and sustainable practices.
damage infrastructure, and lead to • Effective management of climate change risks results in
downtime. less wastages and contribute to overall cost savings for
the Group.

68 Integrated Annual Report 2023

 Sustainability Report

In 2023, we invested RM1,574,500 on:

• Solar power system for manufacturing plant at

Wasco Process Engineering Sdn Bhd in Telok
Panglima Garang, Selangor; and
• Subscription to TNB’s Green Electricity Tariff
(“GET”) programme for Wasco Coatings Malaysia
Sdn Bhd in Kuantan, Pahang.

We are committed to addressing the issue of climate

change and improving efficiency through adaptation by
adopting new and green technology in developments
and implementing fuel efficiency measures.

Wasco is an active member of the Malaysian Oil & Gas Services Council (“MOGSC”) continues to address climate-
related issues, specifically how it affects the Energy sector. Our role and involvement in this membership include:

• Identifying pressing environmental issues in climate change, water and waste; and
• Collaborating on solutions that drive improvement within Wasco and its supply chains.

We contribute to driving change management through knowledge and information sharing, especially public
policy and regulation. The Council also examines various opportunities, such as hydrogen technology.

We continue to ensure consistency between our climate change policy and the position we advocate at trade
associations of which we are members. In FY2023, key industry events we participated in were:

• Invited as panel speaker at Petronas’ PD&T and Partners HSE Conference held in Kota Kinabalu to share
our experience regarding our sustainability efforts.
• Participated in TNB’s The Energy Transition Conference in Kuala Lumpur.

Wasco Berhad 69
 23,860,629
30,000,000

Sustainability Report
25,000,000

14,070,318
Electricity (kWh)
20,000,000

15,000,000

Consolidation method in carbon footprint

Operational 10,000,000
calculation

Organisational boundary in carbon footprint Accounts for 100% of GHG emissions where Wasco has the
5,000,000
calculation authority to implement operational policies

27,028,386
Independent verification of operational GHG 0
Our process in calculating and measuring GHG is guided and

2021*

2022
data verified by the MGTC.

23,860,629
30,000,000

Scope 1 25,000,000

Coverage: CO2 emissions from the

14,070,318
Electricity (kWh)

20,000 1
entire Group (100%)
20,000,000 consumption of fuel were

15,452
derived from the emission

14,216
factor published by the 1
15,000,000 15,000
IPCC Guidelines for CO2e Emissions

CO2e Emissions
National Greenhouse Gas (tonnes)

(tonnes)
10,000,000 Inventories. 10,000

4,880
5,000,000 5,000

0
0
2021*

2022

2023
2021*

2022

2023
Scope 2
Coverage: CO2 emissions from

14,060
entire Group (100%)
20,000 electricity use: 15,000 35,000
2.29 2.30
15,452

11,008
14,216

• Emissions were derived 12,000 30,000

15,000 from specific emission

25,225
CO2e Emissions

8,719
CO2e Emissions

factor published by
CO2e Emissions

9,000 25,000
(tonnes)

the relevant national

(tonnes)

10,000
(tonnes)

government bodies.
6,000 20,000
4,880

13,599

5,000
3,000 15,000

0 0 10,000
2021*

2022

2023

2021*

2022

2023

5,000

Note: Data for 2022 and 2023 encompasses all entities in Wasco. Data for 2021 were scoped
0 to Wasco’s Energy Division only.
2021*

2022

35,000 2.50
2.29 2.30
29,512

30,000
25,225

2.00
1.88
CO2e Emissions

25,000
(tonnes)

300,000 1.50
20,000
24.45
13,599

225,916

15,000 250,000
1.00
er Withdrawal (m3)

10,000 20.57
200,000
151,121

70 0.50 Report 2023

Integrated Annual
5,000
150,000

0 0
*

2
 14,070,318
Electricity (kWh)
20,000,000

Sustainability Report
15,000,000

10,000,000

5,000,000

We have considered the effects of decarbonisation on the value of our assets over the short, medium and
long term and recognise
0 the importance of considering climate-related impacts and opportunities across our

2021*

2022

2023
business. Wasco’s key strategic priority is to accelerate the global energy transition agenda.

We actively monitor the latest global climate change science published by leading international organisations to
help assess potential risks and opportunities for our portfolio. We seek to manage our portfolio to be resilient to
adapt to a fast-moving energy transition and the increasing expectations of our stakeholders.

14,060
We 20,000
are continuously improving how we identify, assess, manage
15,000 and govern climate-related risks and

15,452
opportunities for our business.

11,008
14,216

12,000
Emissions
15,000 Intensity
CO2e Emissions

8,719
CO2e Emissions
Total GHG emissions do not necessarily reflect efficiency as they 9,000
do not consider changes in output. Wasco
(tonnes)

(tonnes)
10,000 its emissions intensity as the tonnes of carbon dioxide equivalent produced by 1,000 man-hours.
expresses
6,000
4,880

Year
5,000
3,000
2021* 2022 2023

Total Emission (tCO2e) 13,599 25,225 29,512

0 0
2021*

2022

2023

2021*

2022

2023
Total Man-hours 5,938,644 10,985,154 15,704,670

tCO2e/Man-hours (1,000) 2.29 2.30 1.88

35,000 2.50
2.29 2.30 29,512

30,000
25,225

2.00
1.88
CO2e Emissions

25,000
(tonnes)

1.50
20,000
13,599

15,000
1.00

10,000
0.50
5,000

0 0
2021*

2022

2023

Note: Data for 2022 and 2023 encompasses all entities in Wasco. Data for 2021 were scoped to Wasco’s Energy Division only.

Pollution Prevention and Control

Wasco is committed
300,000 to addressing pollution by taking the following measures to reduce and30
avoid pollution
261,490

impacts. They include:

24.45
225,916

250,000 25
• Identifying resources and the generation of all types of waste;
• Avoiding their impact and improving efficiency;
Water Withdrawal (m3)

• Reducing200,000
or eliminating pollution at its source; and 20.57
20
• Modifying production, maintenance and facility processes, materials substitution, conservation, recycling
151,121

and reusing materials where applicable. 16.65

150,000 15

100,000 10

Wasco Berhad 71
50,000 5
7,650
Sustainability Report

Preserving Biodiversity

We strive to operate responsibly and protect biodiversity where we work worldwide. As part of our commitment
to the UNSDGs, we commit to net positive biodiversity impact by exploring our impacts on biodiversity,
protected areas and areas of significant biological value at our operational sites. We are focused on minimising
biodiversity impact and our environmental footprint, preserving natural habitats and protecting and restoring
ecosystems through nature-based projects.

We conduct formal biodiversity risks assessment on existing operations and potential new operations and
projects. Before commencing a project, we perform a detailed Environmental Impact Assessment (“EIA”) to study
the potential impact of our operations on habitats and ecological functions. The EIA also helps the Company to
formulate risk mitigation approaches. As example, biodiversity risks are continuously monitored at our new site
in Tanzania.

Waste

Wasco is responsible for conducting business without any detrimental effects on the environment. We comply
with all applicable and prevailing laws and industry standards on waste management, adopting products,
systems, and work practices that minimise or reduce the impact of waste whilst improving efficiency by
increasing the potential for reuse and recycling of resources.

The Group’s Waste Management Procedure sets out the following expectations:

• Efficient resource use to minimise the impact of pollution.

• Waste generation should be minimised at its source whenever possible.
• Finding alternative means for waste disposal by adopting cleaner and sustainable technology.
• Meeting all legal requirements on waste handling and disposal.

Our waste handling process for every type of waste disposed of from our operations is presented below.

• Sewage and greywater are collected in designated tanks, supplied and plumbed, and
Sewage and
Greywater
attached to ablution and lunchroom facilities.
• Tanks are emptied regularly by an authorised contractor.

Scrap • Scrap metal, including copper, is collected in a scrap metal skip.

metal • Scrap metal is collected or replaced by a contractor as appropriate.

• Scrap timber and large general waste items are collected in a general waste skip.
• Smaller or lighter general waste items, waste paper and food waste are collected in
General local, lined bins. Waste is fully contained and tied within suitable garbage bags upon
Waste emptying before being placed in the general waste skip to prevent it from being blown
by the wind.
• The general waste skip is emptied by a contractor as appropriate.

Recyclable • Aluminium cans and plastic bottles are deposited in a designated recycling bin for
containers donation.

Waste • Waste paint is fully hardened in its original container and disposed of as per SDS
paint requirements, such as general waste or by an authorised contractor

72 Integrated Annual Report 2023

 Sustainability Report

• Oily rags are stored in a designated oily rag receptacle.

Oily
rags
• Clients’ maintenance operations should have an existing process for disposing of oily
rags

• Hydrotest water is collected.

Hydrotest • The greywater system can dispose of untreated test water of fewer than 100 litres.
water Operations confirm greywater can handle the volume at the time of disposal. Third
parties may dispose of it if the site cannot handle the additional volume.

• An authorised contractor collects condensate waste in suitable containers for transport

Waste
Condensate
and disposal.
• The client provides a bundled storage area for waste containers awaiting collection.

• An authorised contractor collects amine waste in suitable containers for transport and
Waste disposal.
Amine • The client provides a suitable, bundled storage area for waste containers awaiting
collection.

• A civil contractor removes soil and spoil from the site, transporting them for disposal at
Soil / spoil
an authorised facility.

Waste • A civil contractor removes waste concrete from the site, transporting them for disposal
concrete at an authorised facility.

Contaminate • Contaminated soil, where it arises, is removed and stockpiled for disposal at a suitably
soil licensed facility.

Noise Boundary Monitoring

The noise produced during the construction, operations and decommissioning of large infrastructure projects
can potentially impact nearby noise-sensitive receptors. The Group complies with the Environmental Quality Act
1974. We also conduct boundary noise monitoring at a few points along the perimeter of our operations to align
with approval conditions of Environmental Impact Assessments (“EIA”). In 2022, all noise levels were within 65
dBA, the level stipulated by the Department of Environment.

Wasco Berhad 73
 20,000 15,000

14
15,45

11,008
14,216
12,000
15,000

CO2e Emissions

8,719
CO2e Emissions
Sustainability Report
9,000
(tonnes)

(tonnes)
10,000
6,000

4,880
5,000
3,000

Conserving
0 Water Resources 0
2021*

2022

2023

2021*

2022

2023
We carefully manage the use of fresh water in our operations and the impact of our projects on water resources
in the surrounding areas. We aim to use alternatives such as recycled water to reduce water use and improve
its efficiency. We have a range of processes that evaluate and help us manage risks associated with our water
use. These processes focus on considering water conservation and efficiency in critical decisions and striving
to conserve, reuse and recycle. Wasco has one operation in water-stressed regions. We make every effort to
manage this resource efficiently and minimise water use at all sites.
35,000 2.50
2.29 2.30

29,512
In each site we have our HSE Management Plan, which includes a Water Management Procedure. This
procedure outlines appropriate water control and monitoring measures for water management in the localities
30,000

25,225
that we operate in, with reference to relevant local regulations and applicable legal requirements.
2.00 Some
1.88 harvesting and reusing
examples of site level water reduction measures include water recycling, rainwater
CO2e Emissions

25,000
process water used in plant operation where possible. There has been no incidence of violations of water
(tonnes)

quality standards during this reporting period. 1.50

20,000
Water Consumption and Intensity (100% of Operations)
13,599

15,000
1.00
Wasco expresses its water intensity as total water consumed measured in cubic metres by 1,000 man-hours.
10,000

Year 2021* 2022 0.50 2023

5,000

Total Water Consumed (m3) 151,121 225,916 261,490

0 0
2021*

2022

2023
Total Water Harvested (m3) 0 0 7,650

Total Man-hours 5,938,644 10,985,154 15,704,670

m3/Man-hours (1,000) 25.45 20.57 16.65

300,000 30
261,490

24.45
225,916

250,000 25
Water Withdrawal (m3)

20.57
200,000 20
151,121

16.65
150,000 15

100,000 10

50,000 5
7,650

0 0
2021*

2022

2023

Water Consumed (m3) Havest Water (m3) Water Intensity

Note: Data for 2022 and 2023 encompasses all entities in Wasco. Data for 2021 were scoped to Wasco’s Energy Division only.

74 Integrated Annual Report 2023

 Sustainability Report

Social
Wasco’s community investment principles are closely aligned with the goal of enhancing the well-being and
development of local communities. By strategically aligning business objectives with community investment, the
Group can achieve more favourable outcomes for both itself and the local communities it serves. The focus of
community investment centers around a clearly defined purpose: to drive positive transformation.

Corporate Social Responsibility

Wasco is committed to providing long-term benefits to the community where we operate. In FY2023, we carried
out a series of corporate social responsibility (“CSR”) projects at our operations across the globe.

CSR Programmes for 2023

Volunteer at Casa Harapan – Maendeleo Programme – School Facilities Upgrade –

Wasco Coatings Malaysia Wasco ISOAF, Tanzania PT Wasco Engineering
Sdn Bhd, Kuantan Indonesia, Batam

Wasco demonstrates its commitment Wasco had taken on a culturally A flagship programme involving the
to social responsibility through its conscious and intentional approach upgrading of school infrastructure,
volunteer efforts at Casa Harapan, a by investing in the living cultural aiming to cultivate secure and
shelter home managed by the Drugs heritage of vilagers in Sojo and enriching learning environment for
Intervention Centre Malaysia. Wasco Igusule in Tanzania, through the children. The infrastructure
staff actively engage in various functional, artisanal craft. Wasco enhancement including constructing
tasks aimed at improving the living took initiative to commission, an art studio stage, concreting
conditions of the residents. collaborate and procure locally made school yards, building new restrooms,
furniture complete with decorative renovating existing facilities, repairing
Volunteer activities include cleaning, trimmings from makers in the classroom ceilings and providing
repairs, and installations such as villages. Traditional craftsmanship’s essential furniture for the schools.
ceiling fans, piping, doors, and key advantage lies in its utilisation
LED lamps. By providing essential of natural materials and waste Through these effor ts, Wasco
maintenance and upgrades to minimization, as artisans efficiently aims to empower local schools
the facility, Wasco contributes employ every part of the material, in and contribute to the holistic
to creating a safer and more stark contrast as mass production, development of the community,
comfortable environment for the which Traditional craftsmanship ultimately enhancing educational
residents of Casa Harapan. This practices not only minimise energy opportunities and outcomes for
hands-on involvement reflects consumption but eliminate harmful children in Batam.
Wasco’s dedication to supporting emissions, resulting environmental
local communities and making a benefits and a reduction in our
positive impact on society. Carbon footprint.

In addition to supporting local

artisans, Wasco has initiated a
Bicycle Safety Campaign. This
campaign aims to enhance road
safety by equipping 1000 cyclists
with essential safety gear, including
side mirrors, dynamo lights, and
reflectors.

Wasco Berhad 75
Sustainability Report

Clean-up Day at Aiyki Beach – Wasco Christmas Wish Project – Titiwangsa Park Clean-Up –
Wasco Greece, Thisvi Wasco HQ, Kuala Lumpur Wasco HQ, Kuala Lumpur

Wasco Staff par ticipated in The project went beyond fulfilling On the designated park clean-up
collecting litter, sorting materials the wishes of 30 children, embracing day, Wasco HQ staff and family
for responsible disposal, ensuring the spirit of generosity with gift members gathered at the expansive
a cleaner beach and promoting ranging from anime-themed clothing lakeside area of Taman Titiwangsa
responsible waste management. to essential items. In collaboration early in the morning. Their collective
with Aeon BIG, goody bags and efforts promoted community social
electrical goods enhancing home’s responsibility and fostered a spirit of
facility were contributed. togetherness.

A Place for People

Employees power the work of our company. We provide comprehensive compensation, benefits, tools
and benefits to foster success and career growth for all employees, alligning our labour standards with the
International Labour Organisation (“ILO”) goal of promoting decent work.

Stringent yet fair employment standards and practices are stipulated in the Principles of Business Conduct. Our
stance is communicated to all employees in English as it is the most commonly used business language. This
document is translated into other languages such as Bahasa Malaysia when necessary.

As part of our risk assessment procedure, we regularly review the labour standards of existing and potential
business and supply chain partners as part of due diligence. All parties are familiarised with our Principles of
Business Conduct from time to time. There were no instances of non-compliance with labour standards during
this reporting period.

76 Integrated Annual Report 2023

 Sustainability Report

Competitive Benefits

Our competitive benefits packages provide comprehensive health and wellness resources consistent with the
Employment Act 1955 and additional benefits at our discretion. Wasco also provides leaves of absence for
several quality-of-life needs, including personal, maternity and paternity leave.

Learning and Development

The Group invests in its people by enhancing their competencies and skills to improve work performance and
results; and motivate and reward employees.

Wasco encourages its people to upskill their

knowledge by investing in training and development.
Employees can apply for training and supervisors also
identify training and development where necessary
to improve the employees’ skill and competencies in
accordance to established training matrix. Wasco
also provides a suite of training material through our
iLearn e-learning platform which is accessible to all
employees assigned with an email. As a Group, we
recorded a total of 69,565 training hours, equivalent
to an average of 14.35 training hours per employee
in 2023.

The Group also offers graduate placement and

internship programmes to build future generation of
leaders and address youth unemployment.

Employee Engagement

Employee engagement plays a vital role in boosting employees’ motivation and morale. Wasco engages in
regular staff dialogue physically and virtually to update employees on group developments. Close group
engagement activities at the departmental level strengthened team members’ bonds and addressed human
resource-related matters.

Wasco Berhad 77
Sustainability Report

Occupational Health and Safety

Operating in the energy industry, Wasco’s prime objective is to establish a safe and healthy workplace
for employees, contractors and other stakeholders while protecting the environment. Health, Safety and
Environment (“HSE”) is paramount and prioritised throughout the Group.

Wasco’s HSE policy applies to all contractors and other stakeholders present on its premises. The management
is committed to continuous improvement and compliance with OHSA 1994, FMA 1967, EQA 1974 and
other applicable acts, legislations, orders, rules, codes of practices and other requirements, to which Wasco
subscribes.

We are pleased to report no health & safety incidents that have led to fatalities recorded in 2023. We recorded
three Lost Time Incidents (“LTIs”) in the same period. We are committed to continuous improvement to providing
a safe working environment and maintaining people’s health and well-being. For FY2024, we continue to strive
for ZERO injuries and fatalities at our operations.

Our Total Recordable Incident Frequency (“TRIF”) in 2023 was 1.5, compared to the industry average of 0.9
as reported by the International Association of Oil & Gas Producers (“IOGP”) in their “IOGP Safety Performance
Indicators – 2022 data”.

Wasco’s commitment to health and safety:

 Increased awareness of health and safety among employees

 Reduced number of work accidents and their severity
 Zero occupational illnesses
 Reduced stress
 Enhanced well-being

2023 Highlights

• 71,106,642 Incident Free Man-hours Worked since the last LTI.

• Continued implementation of i-Start programme to enable a safety culture transformation.
• Digital safety observation initiative, the Care Card Advance Analytics project.

Safety starts with the individual; all individuals must protect their health, safety and well-being. Stringent health
and safety standards help prevent hazards and incidents for all employees. As much of our work involves high-
risk construction, we strictly follow the Safe Work Method Statement (“SWMS”), which clearly states measures
to control the risks associated with our nature of work.

All employees are responsible for reporting incidents, near-misses, safety breaches and hazards. In 2023,
Wasco trained 5,352 employees on health and safety standards, including general safety. Training included
HSE induction, forklift operation, rigging and slinging training, working at height, electrical safety, hand safety,
grinding safety and confined space entry.

Wasco’s Board-approved Health and Safety Policy formalises the Group’s health and safety philosophy and
approach. Safety initiatives, internal monitoring and internal safety audit include creating a robust set of safety
protocols and delivering carefully developed safety orientation and ongoing training. This training is extended
to all employees, contractors and subcontractors. Every employee must attend a safety briefing before starting
their workday at a minimum.

78 Integrated Annual Report 2023

 Sustainability Report

Emergency Response Team

Wasco’s Emergency Response Team is responsible for directing evacuation procedures with the aid of fire
wardens, subcontractors, suppliers and emergency services.

Assessing Safety Risks and Compliance

Health hazard, accident and injury prevention are integral parts of the sustainable strategy and business risk
management processes. Wasco’s due diligence includes a health and safety risk assessment for existing and
potential new operations or projects. The Group benchmarks performance monitoring results and trends against
its targets and industry standards.

HSE Certification

ISO 45001:2018 certification covers 69% of Wasco’s operations, ensuring compliance with Occupational Health
and Safety Management System standards.

Safety Governance

Wasco’s Group HSE Committee is responsible for improving working conditions and provides employees and
management with a forum to solve health and safety problems. The HSE Committee is a participative initiative
comprising a chairman and management representatives. Led by Managing Director/Group CEO Mr Gian Carlo
Maccagno, the committee reviews safety concerns, performance and risks and reports the Group’s safety
performance to the Board.

Wasco’s HSE managers and officers are responsible for:

• Coordinating and ensuring HSE programmes are implemented effectively;

• Checking that the Company’s facilities and infrastructure comply with applicable HSE standards;
• Ensuring employees and every individual present at its premises meet all HSE requirements; and
• Inspecting the port facilities and infrastructure daily to ensure compliance with the Occupational Safety
and Health Act 1994, Act 514 (“OSHA 1994”) and its safety guidelines.

Safety Performance

Coverage 100%

Fatalities

Coverage 2021* 2022 2023

Employees 0 0 0

Contractors 0 0 0

Lost-time Incident* Rate

2021* 2022 2023

0 0 0

* Lost Time Injury (LTI) is an injury sustained on the job by an employee that results in the loss of productive work time.

Note: Data for 2022 and 2023 encompasses all entities in Wasco. Data for 2021 were scoped to Wasco’s Energy Division only.

Wasco Berhad 79
 Policy UNSDGs -
Climate Action

• Implementation

Sustainability Report of the Group

Emissions
Reduction Plan

Human Rights

    
Conduct business Respect human Abide by Adhere to all Align human rights
ethically and rights throughout international applicable commitment with
sustainably operations the human rights employment and core values
extended value instruments, human rights throughout all
chain including the laws where operations
Universal operations are
Declaration of based
Human
Rights

Wasco summarised its human rights policy in our Human Rights Statement. All staff receive training on this
policy. All associates review and receive annual awareness briefings on the statement as part of their human
rights policy training. These documents are available in English and Bahasa Malaysia.

Wasco aligns its conduct with the United Nations Guiding Principles on Business and Human Rights. The day-
to-day responsibilities and functions for monitoring human rights compliance have been allocated to various
departments.

• Proactively assessing our human rights impacts on an ongoing basis as part of the
Group’s core business processes

• Evaluating the effects of the business and setting targets to drive continuous
improvement.
We respect
human rights
by: • Avoiding, preventing and mitigating human rights issues

• Communicating expectations to all stakeholders, including business partners.

• Implementing human rights screening, training and monitoring of internal

operations and supply chain partners
Wasco adheres to all applicable employment and human rights regulations where operations are based.
Suppliers must do the same and abide by the Group’s Principles of Business Conduct and Human Rights
Statement as a minimum. To ensure that suppliers abide by the Group’s Principles of Business Conduct and
Human Rights Statement, it is included in our procurement process for vendors to sign our Corporate Social
Responsibility (Labour) declaration.

Wasco ensures compliance to all relevant labour laws and our internal Principles of Business Conduct covers
human rights issues, including non-discrimination, freedom of association and collective bargaining, prevention
of child labour, forced and compulsory labour.

80 Integrated Annual Report 2023

 Sustainability Report

Our Approach to the Human Rights Issues Affecting the Industry

We do not tolerate forced labour and/or any forms of modern slavery, including bonded
Forced
Labour
labour or human trafficking. Every employee willingly accepts the offer made by the
Company.

Child We strictly comply and adhere to international child labour laws and the minimum legal
labour age to work in every country in which we operate.

We prohibit any form of discrimination based on race, creed, sex, social status, religion,
Discrimination nationality, age, sexual orientation, gender identity, physical and mental disability or any
other grounds.

Harassment
Harassment is strictly not tolerated in any form, whether physical or mental, including
and inhumane
treatment sexual harassment or power harassment.

Working hours We monitor employee working hours, holidays and leaves of absence to comply with
and wages applicable laws and regulations.

Transparency and respectful engagement are cornerstones of our sustainability

performance, allowing our business to evolve successfully and respectfully. We consider
Grievance
a robust grievance mechanism essential to protecting the people, community and
environments affected by our operations.

Wasco Berhad 81
Sustainability Report

Non-Discrimination

Wasco is committed to a workforce free of harassment and unlawful discrimination.

We treat all employees equally and fairly regardless of:

• Race, colour, age, gender, sexual orientation, gender identity and expression, ethnicity or nationality,
disability, pregnancy, religion, political affiliation or marital status.

We protect all employees in:

• Hiring and employment practices through adequate living wages, promotions, rewards and access to
training.

We uphold our stand of ‘equal pay for equal work’ and comply with all local laws. There were no reported
discrimination cases related to equality and diversity in 2023.

Equality in Recruitment

Wasco adheres to local labour laws during recruitment, with a preference for hiring locally. Hiring from
local communities enhances our ability to understand local needs and strengthens our capabilities on the
ground. However, diverse talent and expertise are vital for a Group with an ever-expanding international
customer base. Wasco sources these talents and expertise internationally when unavailable locally.

Wasco practises equal opportunity and non-discrimination in its hiring process; candidates are only
assessed on their qualifications and job suitability. Wasco does not discriminate in any stage of the hiring
process, including recruiting from underprivileged groups, deprived backgrounds or people with disablity.
However, we employed 0% employees with disability at the end of FY2023.

In 2023, Wasco recorded an overall voluntary turnover rate of 10.91% during the year. Females
represented 8% of the total workforce. Female representation at the Senior Leadership Team level
remained stable at 15%.

Speak Up

Wasco complies with laws by continuously monitoring internal processes, such as hiring and promotion. We
actively encourage employees to speak up if they believe someone has violated the Principles of Business
Conduct or labour laws. We take all reports seriously, investigate each rigorously and demand the same high
standards from suppliers and other entities with which we conduct business.

Wasco has a formal mechanism for individuals, employees and communities impacted by our business activities
to raise their grievances, including human rights. An effective whistleblowing channel guarantees anonymity
and is available to internal and external stakeholders. Our whistleblowing channel also allows employee
representatives to engage with management. There were no instances of human rights violations during this
reporting period.

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 Sustainability Report

Salient Human Rights Issues

Wasco assessed potential adverse human rights impacts and salient human rights issues. Engaging with
stakeholders helped identify potential human rights impacts affecting operations.

• Freedom of association and engagement

• Enjoy just and favourable conditions of work

Right to: • An adequate standard of living

• Health

• Social security and social insurance

Wasco supports the amendments to the Workers’ Minimum Standards of Housing and Amenities Act 1990.
All contractors working on our projects must provide worker facilities that follow the International Labour
Organisation (ILO) guidelines.

Employees’ wages comply with all applicable Malaysian laws such as working hours, minimum living wages,
overtime hours and legally mandated benefits. In compliance with Malaysian law, we compensate workers for
overtime at pay rates above the stated regular hourly rates. Docking wages as a disciplinary measure is not
permitted. We also aim to eliminate excessive working hours by limiting them.

Product Responsibility

Providing cutting-edge technical services and licensed technologies, Wasco possesses the capabilities to
deliver reliable and competitive products, premium solutions and unrivalled services.

Premium Solutions, Flawless Deliveries

Wasco’s quality management system (“QMS”) employs a process approach, enabling Wasco to plan its
processes and interactions adequately. Wasco is committed to enhancing customer satisfaction and providing
products and services that meet applicable statutory and regulatory requirements.

This QMS aligns with the most current ISO 9001:2015 and ISO 45001. Our laboratories are also certified with
ISO/IEC 17025, the general requirement for the competence of testing and calibration laboratories published by
the ISO.

We ensure all company and project-level QMS processes run effectively to improve customer satisfaction as
mandated in the Group’s Quality Policy.

Installing an Improved Pipe Tracking System enhanced quality delivery by tracking individual pipeline movement
and status throughout the coating system. The system maintains pipes’ current position, including repair and
rejection, and improves tracking traceability. Utilising the powerful Welds Tracking System boosts efficiency and
reduces wasted resources through effectively managing welders’ status.

Wasco encourages anonymous customer feedback and monitors the results regularly. Maintaining close
customer engagement during various project stages helps us understand and achieve their expectations.

Wasco Berhad 83
Sustainability Report

Our Digital Transformation Journey

Wasco recognised that Digitalisation is a core competency for Wasco to survive and thrive. In 2023, we
continued delivering various workshops and discussions virtually and physically to raise awareness of
digitalisation at management and operation levels. We continued our journey in the smart manufacturing
context by embarking on an Industry 4.0 journey by understanding its generic definition, aligning it with
business priorities and understanding the different levels of digital maturity before directly entering the project
implementation phases.

Wasco nurtures its in-house IT capabilities

by investing heavily in its ERP system for
several years. Developing different business
applications in data reporting and process
automation has supported our business
divisions. In navigating the uncer tain
future of energy transition, we recognise
the requirement for a new wave of digital
transformation to equip our employees with
the necessary skillsets, tools and platforms to
embrace such dynamic changes.

While digital technologies are the enablers for

the next wave of transformation, Digitalisation
extends beyond the technology component; data-driven initiatives change how we think, work and collaborate.
Digitalisation value is unlocked when employees are empowered with digital and data, shifting their focus to a
more people-centric model by providing higher-value and sustainable solutions to customers and partners.

Empowering stakeholders to do more with less can only be achieved by allowing employees and customers to
work together with digital technologies in the same ecosystem. We have started the data and AI journey by
converging digitalisation with safety, sustainability and other strategic pillars, strengthening their potential.

For FY2023, we continued our programme to empower HSE personnel with a digital platform, rolling out to
newly established operation sites. This platform covers people, processes, and technology to address safety
concerns raised in our plants and yards, promptly. The Environmental Dashboard continues to provide valuable
insights on the Group’s GHG emission from the data gathered, enabling us to focus our efforts in combating
climate change effectively. In 2023, the Governance Dashboard was developed, providing a digital platform
for our Risk Management process. We will expand this further in FY2024 to track key performance indicators
related to the Social aspect of ESG.

84 Integrated Annual Report 2023

 Sustainability Report

ESG Performance Data

Environmental Performance

Parameter Units 2021* 2022 2023

Energy
Electricity
Total Electricity Consumption MWh 14,070 23,861 27,028
Rooftop Solar PV Generation MWh 0 640 664
Green Electricity Purchased via Green Electricity Tariff MWh 0 5,000 6,000
Fuel
Diesel Consumption Liter 1,258,620 3,604,783 4,225,355
LPG Consumption m 3
39,980 143,192 308,875
Petrol/Gasoline Consumption Liter 51,683 95,112 107,513
Air Emissions
NOX Emission kg 30 85 99
SOX Emission kg 0 0 0
Volatile Organic Compounds (VOC) Emission kg 0 0 0
Water & Wastewater
Water Withdrawal
Municipal potable water m3 151,121 225,916 261,490
Harvested rainwater m 3
0 0 7,650
Surface water from rivers, lakes, natural ponds m 3
0 0 0
Groundwater from wells, boreholes m 3
0 0 2
Used quarry water collected in the quarry m3 0 0 0
External wastewater m3 0 0 0
Sea water, water extracted from the sea or the ocean m 3
0 0 0
Total water withdrawal m 3
151,121 225,916 258,046
Wastewater/Effluent Discharge
Discharge to Off-site Water Treatment Plant m3 4,316 10,744 1,310
Discharge to Ocean m 3
0 0 0
Discharge as Surface Water m 3
0 0 0
Discharge to Subsurface/Well m3 0 0 0
Others m3 0 0 0
Total wastewater/effluent discharge m 3
4,316 10,744 1,310
Percentage of WSC sites located in water stressed area % 0% 6% 5%
Water consumed in water stressed area m 3
0 13,859 6,848
Cost associated with water-related risk RM 0 0 0
Investment in water saving initiative RM 0 0 0
Number of incidents related to non-compliance with No. of Incidents 0 0 0
water consumption related to local regulations

Wasco Berhad 85
Sustainability Report

Parameter Units 2021* 2022 2023

Waste
Waste Generation
Total waste tonnes 2,009 3,041 5,373
Hazardous tonnes 1,387 1,070 549
Non-recycled tonnes 621 1,876 3,132
Recycled tonnes 0 951 1,692
Environmental Management & Compliance
Environmental Fines/Penalties RM 0 0 0
Greenhouse Gas and Climate Change
Scope 1 tCO2e 4,880 14,217 15,452
Scope 2 tCO2e 8,719 11,008 14,060
Internal carbon price RM/tCO2e Not Used
Flaring emission from LPG storage tank tCO2e 0 0 0
Methane Emission tonnes 0 0 1
Emission Intensity tCO2e/1,000 2.29 2.30 1.88
manhours
worked

Note: Data for 2022 and 2023 encompasses all entities in Wasco. Data for 2021 were scoped to Wasco’s Energy Division
only.

Social Performance

Parameter Units 2021* 2022 2023

Health and Safety

Percentage of sites with ISO 45001:2018 % 67% 63% 69%
certification
Percentage of sites with ISO 14001:2015 % 56% 56% 54%
Environmental Management System certification
H&S Training
Number of staff trained on safety No. of staff 1025 1702 5352
Lost Time Incident Rate (LTIR), including contractors per 1,000 0 0 0.2
hours worked
Number of work-related fatalities for staff No. of staff 0 0 0
Number of work-related fatalitites for contractor No. of 0 0 0
contractor
Communities
Total Amount of donations or community RM 166,500 32,253 875,433
investsments

86 Integrated Annual Report 2023

 Sustainability Report

Parameter Units 2021* 2022 2023

Labour Standards
Total number of staff No. of staff 2312 3865 5,752
Total number of contractors No. of 866 1722 4,660
contractor
Full time staff voluntary turnover rates % 3.35% 1.73% 11%
Percentage of employees that are contractors or % 27% 31% 81%
temporary staff
Amount of time spent on employee development hours per 2 5 14
training to enhance knowledge or individual skills employee
Percentage of staff with a disability % 0% 0% 0%
Percentage of women in the workforce (incl. % 6% 8% 8%
contractors)

Note: Data for 2022 and 2023 encompasses all entities in Wasco. Data for 2021 were scoped to Wasco’s Energy Division only.

Governance Performance

Parameter Units 2021* 2022 2023

Anti-Bribery and Anti-Corruption

Total amount of political contributions made RM 0 0 0
Number of staff disciplined or dismissed due to No. of Staff 0 0 0
non-compliance related to Anti-Bribery/Anti-Corruption
Cost of fines, penalties or settlements in relation to RM 0 0 0
corruption
ESG Provisions
Provisions for fines and settlements specified for RM 0 0 0
ESG issues

Note: Data for 2022 and 2023 encompasses all entities in Wasco. Data for 2021 were scoped to Wasco’s Energy Division only.

Wasco Berhad 87
Sustainability Report

Bursa Malaysia Sustainability Reporting Data

Indicator Measurement Unit 2023

Anti-corruption
Percentage of employees who have received training on anti-corruption
by employee category
Leadership Team Percentage 100%
Managers Percentage 100%
Executives Percentage 100%
Non-Executives Percentage 100%
Percentage of operations assessed for corruption-related risks Percentage 0
Confirmed incidents of corruption and action taken Number 0
Percentage of employees that the organisation’s anti-corruption
policies and procedures have been communicated to
Leadership Team Percentage 100%
Managers Percentage 100%
Executives Percentage 100%
Non-Executives Percentage 100%
Community/Society
Total amount invested in the community where the target beneficiaries RM 875,433
are external to the listed issuer
Total number of beneficiaries of the investment in communities Number 7,759
Diversity
Percentage of employees by gender and age group, for each employee
category
Age Group by Employee Category
Leadership Team Under 30 Percentage 0%
Leadership Team Between 30-50 Percentage 38%
Leadership Team Above 50 Percentage 62%
Manager Under 30 Percentage 1%
Manager Between 30-50 Percentage 76%
Manager Above 50 Percentage 24%
Executive Under 30 Percentage 23%
Executive Between 30-50 Percentage 67%
Executive Staff Above 50 Percentage 10%
Non-Executive Under 30 Percentage 26%
Non-Executive Between 30-50 Percentage 68%
Non-Executive Above 50 Percentage 6%

88 Integrated Annual Report 2023

 Sustainability Report

Indicator Measurement Unit 2023

Gender Group by Employee Category

Leadership Team Male Percentage 85%
Leadership Team Female Percentage 15%
Manager Male Percentage 77%
Manager Female Percentage 23%
Executive Male Percentage 78%
Executive Female Percentage 22%
Non-Executive Male Percentage 97%
Non-ExecutiveFemale Percentage 3%
Percentage of directors by gender and age group
Male Percentage 22%
Female Percentage 78%
Under 30 Percentage 0%
Between 30-50 Percentage 22%
Above 50 Percentage 78%
Total Employee by category 5,752
Leadership Team Number 53
Managers Number 305
Executives Number 1,138
Non-Executives Number 4,256
Energy management
Total energy consumption Megawatt 26,749
Health and safety
Number of work-related fatalities Number 0
Lost time incident rate (“LTIR”) Rate 0
Number of employees trained on health and safety standards Number 5,352
Labour practices and standards
Total hours of training by employee category
Leadership Team Hours Information
unavailable*
Manager Hours Information
unavailable*
Executive Hours Information
unavailable*
Non-Executive Hours Information
unavailable*
Percentage of employees that are contractors or temporary staff Percentage 81%

Wasco Berhad 89
Sustainability Report

Indicator Measurement Unit 2023

Total number of employee turnover by employee category

Leadership Team Number 6
Manager Number 37
Executive Number 177
Non-Executive Number 321
Number of substantiated complaints concerning human rights Number 0
violations
Supply chain management
Proportion of spending on local suppliers Percentage 62%
Data privacy and security
Number of substantiated complaints concerning breaches of customer Number 0
privacy and losses of customer data
Water
Total volume of water used Megalitres 258

* In FY2023, training data were tracked without the necessary granularity. However, a plan is now in place to enhance the
granularity of this information starting from January 2024. Wasco will identify employees responsible for collecting and
managing the required data. Additionally, a standardised reporting template will be established, and regular meetings will be
scheduled to review the data.

90 Integrated Annual Report 2023

 Sustainability Report

Statement of Assurance
In strengthening the credibility of the Sustainability Statement, selected aspects of this Sustainability Statement
have been subjected to an internal review by the company’s internal auditors and has been approved by Audit
Committee of Wasco Berhad.

Subject Matter

The subject matter covered by the internal review focused on the common material sustainability matters of the
selected aspects as below and included the following common indicators:

a. Business Ethics and Compliance – Anti Bribery and Corruption and Whistleblowing

 Percentage (%) of employees who have received training on anti-bribery by employee category.
 Percentage (%) of operations assessed for bribery related risks.
 Confirmed incidents of corruption and action taken.

b. Diversity, Equal Opportunity, and Non-Discrimination

 Percentage (%) of employees by gender and age group, for each employee category.
 Percentage (%) of directors by gender and age group.
 Confirmed incidents of inequality in giving opportunities, discrimination and action taken.

c. Training and Development

 Total hours of training by employee category.

Scope

The boundary of the internal audit review are operations of Wasco Berhad in Malaysia, of which comprised four
(4) legal entities as stated below:

 Wasco Process Engineering Sdn. Bhd. (formerly known as Jutasama Sdn. Bhd.)
 Wasco Thermal Sdn. Bhd. (formerly known as Mackenzie Industries Sdn. Bhd.)
 Wasco AgroTech Sdn. Bhd. (formerly known as PMT Industries Sdn. Bhd.)
 Wasco Coatings Malaysia Sdn. Bhd.

Wasco Berhad 91
05
92 Integrated Annual Report 2023
Commitment
to Governance
Profile of Board of Directors
Profile of Key Senior Management Team
Corporate Governance at Wasco
Audit Committee
Nomination and Remuneration Committee
Governance, Compliance and Risk Committee
Corporate Governance Overview Statement
Additional Compliance Information
Statement on Risk Management and Internal Control
Statement of Directors’ Responsibility

Wasco Berhad 93
Profile of Board of Directors

Dato’ Seri Robert Tan Chung Meng Gian Carlo Maccagno

Non-Independent Non-Executive Chairman Managing Director/Group Chief Executive Officer

Dato’ Seri Robert Tan, a Malaysian, male, aged 71, Mr Maccagno, an Italian, male, aged 60, was first
was appointed Chairman of Wasco Berhad (formerly appointed as an Executive Director of WB on 1 June
known as Wah Seong Corporation Berhad) (“WB”) on 2004 and subsequently promoted to be the Deputy
22 May 2002. Managing Director on 1 January 2007. Mr Maccagno
succeeded the role as Managing Director/Group Chief
Dato’ Seri Robert Tan has vast experience in property Executive Officer of WB following the retirement of Mr
development, hotel construction, retail design and Chan Cheu Leong from the position with effect from 1
development as well as corporate management July 2023. He is responsible for the overall business
with more than 30 years’ experience in the property and management operations of the WB Group.
and hotel industries. After studying Business
Administration in the United Kingdom, he was Mr Maccagno attained his Bachelor in Business
attached to a firm of Chartered Surveyor for a year. Administration from Tecnico Commerciale Maddalena
He had also developed a housing project in Central Adria (RO) Italy in 1982, after which he worked
London before returning to Malaysia. His stint in the with Socotherm S.R.L, Italy from 1984 to 1987 as a
property industry began with IGB Corporation Berhad Trainee in Production and Project Management. He
(“IGB Corp”) in 1995 when he was appointed Joint was appointed as Project Manager for Socotherm
Managing Director and subsequently Group Managing S.R.L in Nigeria from 1987 to 1990 and was briefly
Director from 2001 until 2022. seconded to Petro-Pipe Industries (M) Sdn. Bhd.
(“PPI”) in 1990 to assist in the setting up of PPI’s
Dato’ Seri Robert Tan was involved in various coating plant in Kuantan, Malaysia. After serving
development projects carried out by IGB Group, as Country Manager for Socotherm S.R.L in Taiwan
in particular Mid Valley City. From inception to the from 1991 to 1992, he returned to Malaysia in
realisation of Mid Valley Megamall (“MVM”) and The 1993 to be the General Manager of Wasco Coatings
Gardens Mall (“TGM”), he was actively involved in Malaysia Sdn. Bhd. in Kuantan, Malaysia. He has vast
every stage of their developments. He is instrumental experience in the global pipe coating business and
to the development and success of MVM and TGM, the Oil and Gas business in general.
and more importantly, in retaining their positions as
prime shopping hotspots in the Klang Valley. Mr Maccagno is a Director of Petra Energy Berhad. He
also sits on the Board of several other private limited
Following the de-listing of IGB Corp from the Official companies.
List of Bursa Malaysia Securities Berhad, Dato’
Seri Robert Tan was the Group Chief Executive
Officer of IGB Berhad from 30 March 2018 until 31
December 2022 and thereafter he remains as a
Non-Independent Non-Executive Director. He is the
Chairman of IGB REIT Management Sdn. Bhd. (the
Manager of IGB Real Estate Investment Trust and IGB
Commercial Real Estate Investment Trust).

Dato’ Seri Robert Tan is a Trustee of Yayasan Tan Kim

Yeow and he also sits on the Board of several other
private limited companies.

94 Integrated Annual Report 2023

 Profile of Board of Directors

Tan Sri Saw Choo Boon Datin Wan Daneena Liza Binti Wan
Senior Independent Non-Executive Director Abdul Rahman
Independent Non-Executive Director

Tan Sri Saw Choo Boon, a Malaysian, male, aged 77, Datin Wan Daneena Liza Binti Wan Abdul Rahman,
was appointed to the Board of WB on 6 April 2018 as a Malaysian, female, aged 50, was appointed to the
an Independent Non-Executive Director. Tan Sri Saw Board of WB on 7 April 2023.
was then appointed as the Senior Independent Non-
Executive Director of WB with effect from 23 May Datin Wan Daneena holds a Bachelor of Science in
2023. Economics and Accounting (1st Class Honours) from
the University of Bristol, United Kingdom and is a
Tan Sri Saw holds a Bachelor of Science (Chemistry) Member of the Institute of Chartered Accountants in
Honours from the University of Malaya. He joined England and Wales (“ICAEW”), and a Member of the
Shell Malaysia in 1970 and served in various Malaysian Institute of Accountants (“MIA”). She was
capacities in Manufacturing, Supply, Trading and a senior partner in the Financial Services Assurance
Planning in Malaysia, Singapore and Netherlands. practice of Ernst & Young, Malaysia until September
2022.
He was appointed Managing Director of Shell MDS
(Middle Distillate Synthesis) Sdn. Bhd. in 1996. In After completing her undergraduate degree, she
1998 he became the Managing Director of Shell began her career as an auditor at KPMG London
Malaysia Trading Sdn. Bhd., Shell Timur Sdn. Bhd. in September 1996, serving the Information,
and Shell Refining (FOM) Berhad, responsible for Shell Communication and Entertainment industry (“ICE
Malaysia’s Downstream business. In 1999, with the Group”). She qualified as a professional chartered
globalisation of the Shell Oil Products business, he accountant with ICAEW in December 1999 and
assumed the role of Vice-President of the Commercial returned to Malaysia in August 2002 as an Audit
business in the Asia-Pacific region and in 2005, Manager in the Financial Services Assurance Group of
he managed Shell’s Marine Oil Products business Ernst & Young Kuala Lumpur. She became a partner
globally. of Ernst &Young in July 2008.

He was appointed Chairman of Shell Malaysia in 2006 Datin Wan Daneena has more than 25 years of
till his retirement in 2010 after 40 years of continuous experience in providing various types of assurance
service. He has served on many Boards including and business advisory services to corporations
Shell Refining Berhad, Heineken Malaysia Berhad, including financial institutions and conglomerates,
Ranhill Utilities Berhad, RHB Bank Berhad, and Digi. listed and private entities which include commercial,
Com Berhad. Islamic and investment banks, development financial
institutions, asset management and stock broking
Currently, Tan Sri Saw is the Chairman of Sentral REIT companies, sovereign wealth funds, venture capital
Management Sdn. Bhd. (formerly known as MRCB and private equity funds, unit and property trusts,
Quill Management Sdn. Bhd.). He is also a Board investment holding companies, credit rating agency,
member of Socio-Economic Research Centre Sdn. government-linked investment companies (“GLICs”),
Bhd. of Associated Chinese Chambers of Commerce statutory bodies and foundations.
and Industry Malaysia and a Council Member of the
Federation of Malaysian Manufacturers. Datin Wan Daneena also sits on the Board of PLUS
Malaysia Berhad and S P Setia Berhad.

Wasco Berhad 95
Profile of Board of Directors

Lily Rozita Binti Mohamad Khairi Chan Cheu Leong

Independent Non-Executive Director Non-Independent Non-Executive Director

Ms Lily Rozita Binti Mohamad Khairi, a Malaysian, Mr Chan Cheu Leong, a Malaysian, male, aged 73,
female, aged 53, was appointed to the Board of WB was appointed to the Board of WB on 22 May 2002
on 12 April 2023. as the Managing Director/Group Chief Executive
Officer. He retired from the position of Managing
Ms Lily holds a Bachelor of Law degree (LLB Honours) Director/Group Chief Executive Officer on 1 July 2023
from Cardiff University, United Kingdom and a and was instrumental in the consolidation and listing
Diploma in Human Resource Management from the of WB Group in year 2002. He remains as a Non-
Management Institute of Personnel Management. Independent Non-Executive Director of WB.
She joined Shell Malaysia in 1994 and served in
various roles including in Human Resources and Legal Mr Chan attained a Bachelor of Science (Hon)
involving Upstream, Downstream and Integrated Gas Degree in Engineering Production in 1974 from the
and Power business. University of Birmingham under a Colombo Plan
Award and began his career by joining the Singapore
She was appointed as the Head of Legal and Administrative Service. He left the Ministry of
Managing Counsel from 2011 to 2016, before Finance, Singapore in 1976 to pursue his Master in
embarking on a global role as the Ethics and Business Administration from the London Business
Compliance Officer for Downstream in Shell Plc from School.
2016 to 2021.
Upon successful completion of the same, he joined
She has held various leadership positions such as ESSO Production Malaysia Incorporated as their
Deputy President of the Malaysian Corporate Counsel Senior Financial Analyst before joining Tractors
Association from 2006 to 2010 and President of Shell Malaysia Berhad as their Group Treasurer in 1981.
Women Action Network (SWAN) from 2010 to 2012. Thereafter, he left to become the Group Executive
Director for General Corporation Berhad from 1984
Since 2021, she is the Ethics and Compliance Officer to 1990 before assuming the position of Managing
for Projects & Technology/ Global Function in Shell Director of Tan & Tan Developments Berhad from
Plc, providing leadership and advisory to businesses 1990 to 1995. In 1994, he established Wah Seong
and functions worldwide on ethical leadership Industrial Holdings Sdn. Bhd. and subsequently
and culture, policy formulation, risk management formed WB, which was listed on the Main Market
and monitoring/ implementation of compliance of Bursa Malaysia Securities Berhad on 9 July
programmes across the leadership teams and 2002. He has extensive experience in the property,
businesses. manufacturing and financial fields. Mr Chan is a
former member of Sustainable Energy Development
Ms Lily has more than 29 years of experience within Authority (SEDA) Malaysia and a former member
the Shell organisation in a variety of roles inclusive of the Advisory Council of Federation of Malaysian
of Legal, Ethics & Compliance and Human Resources Manufacturers (FMM).
management.

96 Integrated Annual Report 2023

 Profile of Board of Directors

Halim Bin Haji Din Tan Sri Professor Lin See Yan
Non-Independent Non-Executive Director Non-Independent Non-Executive Director

Encik Halim bin Haji Din, a Malaysian, male, aged 77, Tan Sri Prof. Lin See Yan, a Malaysian, male, aged 84,
was appointed to the Board of WB on 22 May 2002 was appointed to the Board of WB on 20 July 2004
as an Independent Non-Executive Director. He was as an Independent Non-Executive Director. He was
redesignated as a Non-Independent Non-Executive redesignated as a Non-Independent Non-Executive
Director of WB with effect from 23 May 2023. Director of WB with effect from 23 May 2023.

Encik Halim is a Chartered Accountant who spent Professor Lin, a British Chartered Scientist, is a
more than 30 years working for multinational Harvard educated economist. Qualified as Malaysia’s
corporations and international consulting firms. He first Chartered Statistician, he graduated from the
accumulated 18 years of experience working in the University of Malaya in Singapore and Harvard
oil and gas industry - 6 years of which as a Board University (where he received three (3) degrees,
member of Caltex/Chevron, responsible for financial including a PhD in Economics). He is Pro-Chancellor,
management before engaging in the consulting Universiti Teknologi Malaysia; Pro-Chancellor &
business. Prior to his appointment as a Board Research Professor at Sunway University; Professor
member of Caltex Malaysia, he served as Regional of Economics (Adjunct), Universiti Utara Malaysia;
Financial Advisor for Caltex Petroleum Corporation Eisenhower Fellow; and President of Harvard Club of
Dallas, Texas overseeing investment viability of the Malaysia.
corporation’s Asian subsidiaries.
Prior to 1998, he was Chairman/President and Chief
He also had an extensive experience in corporate Executive Officer of Pacific Bank and for fourteen
recovery when he worked for Ernst & Whinney, (14) years previously, Deputy Governor of Bank
London, United Kingdom in mid-1980’s. He was Negara Malaysia, having been a central banker for
appointed as Managing Partner of the consulting thirty four (34) years. Tan Sri Lin continues to serve
division of Ernst & Young Malaysia in 1995. He later the public interest, including member of a number
became the Country Advisor of Cap Gemini Ernst of key Committees at Ministry of Higher Education;
& Young Consulting Malaysia when Cap Gemini of Member, Asian Shadow Financial Regulatory
France merged with Ernst & Young Consulting. In Committee; Economic Advisor, Associated Chinese
2003, he with two partners took over the consulting Chambers of Commerce and Industry of Malaysia;
business of Cap Gemini Ernst & Young Malaysia Governor, Asian Institute of Management, Manila;
through a management buyout and rebranded it as Board Director, Sunway University; and Chairman
Innovation Associates, currently known as IA Group, Emeritus, Harvard Graduate School Alumni Council at
where he is currently the Chairman of the group. Harvard University in Cambridge (USA) as well as its
Senior Associate.
He was a Council Member of the Malaysian Institute
of Certified Public Accountants (MICPA) from 1994 Tan Sri Lin was a Director of Sunway Berhad and IGB
to 2003. He previously served as an Independent REIT Management Sdn. Bhd. (the Manager of IGB Real
and Non-Executive Director on the board of MMC Estate Investment Trust and IGB Commercial Real
Corporation Berhad (5 years), Takaful Ikhlas Berhad Estate Investment Trust). He currently advises and
(10 years), Employees Provident Fund (4 years), sit on the Board of Nylex (Malaysia) Berhad and other
Kwasa Land Sdn. Bhd. (3 years) and BNP Paribas private businesses in Malaysia as well as ASEAN.
Berhad (9 years). He is the fellow member of MICPA
and Malaysian Institute of Accountants.

Wasco Berhad 97
Profile of Board of Directors

Tan Jian Hong, Aaron

Non-Independent Non-Executive Director

Mr Tan Jian Hong, Aaron, a Malaysian, male, aged 40,

was appointed to the Board of WB on 25 May 2015.

Mr Tan holds a Bachelor of Arts in Economics from Notes:-

Johns Hopkins University, Baltimore, Maryland, USA.
Family relationship with Directors and/or major shareholders
Mr Tan began his career as a Financial Advisor
Associate with UBS Financial Services, Inc from 2008 1. Dato’ Seri Robert Tan Chung Meng and Mr Tony Tan
to 2010. He was promoted to become a Branch Choon Keat are siblings.
Analyst, specializing in private wealth management 2. Mr Tan Jian Hong, Aaron is the son of Mr Tony Tan Choon
Keat and nephew of Dato’ Seri Robert Tan Chung Meng.
in 2010. In 2011, he returned to Malaysia and joined
3. Dato’ Seri Robert Tan Chung Meng and Mr Tony Tan
Hong Leong Investment Bank as a Client Relationship Choon Keat are deemed major shareholders of WB and
Executive until 2013. In 2013, he moved on to join their interest in the securities of WB are set out in the
Wasco Energy Ltd Group, an international Oil and Analysis of Shareholdings of this Annual Report.
Gas and Industrial Services Group as Project and
Operations Senior Manager. Mr Tan sat on the Board Saved as disclosed herein, none of the Directors have
of Yi-Lai Berhad (YLB) from 2014 to 2020. He was any family relationship with any Directors and/or major
responsible for the strategic business direction of the shareholders of WB.
YLB Group and played an active role in the overall
Conflict of interest
management.
1. Ms Lily Rozita binti Mohamad Khairi is currently working in
Mr Tan was appointed as an Alternate Director to Mr Shell Plc as the Ethics and Compliance Officer for Projects
Tony Tan Choon Keat on the Board of IGB Berhad & Technology/Global Function. Due to the nature of Wasco
(formerly known as IGB Corporation Berhad) from Berhad’s business, there may be prospects or future
November 2016 till April 2018. dealings between Shell and Wasco Berhad and its Group
of Companies (“Wasco Group”). Any potential or perceived
conflict of interest has been registered with Shell and
In 2021, Mr Tan had taken up the investment
mitigations inclusive of recusal has been put in place.
advisory roles at Astrid Hill Asset Management Pte. 2. Datin Wan Daneena’s husband is currently the President
Ltd. and K3 Ventures Pte. Ltd.. He also sits on the & Group Chief Executive Officer of Affin Bank Berhad,
Board of several other private limited companies. one of the financial institutions from which Wasco Group
has borrowings. Datin Wan Daneena shall abstain from all
discussions and decisions of Wasco Group involving Affin
Bank Berhad.

Saved as disclosed herein, none of the Directors have any

conflict of interest with WB.

Convicted of offences

None of the Directors have been convicted for any offence

within the past five (5) years other than possible traffic
offences and have not been imposed any public sanction or
penalty by the relevant regulatory bodies during the financial
year 2023.

98 Integrated Annual Report 2023

 Profile of Key Senior Management Team

Ramanathan P.R. Singaram

Chief Financial Officer
56 years of age | Male | Malaysian | Appointed 1 July 2013

Mr Ramanathan P.R. Singaram is the Chief Financial Officer (“CFO”) of Wasco Berhad
(formerly known as Wah Seong Corporation Berhad) (“WB”) since 1 July 2023.
Previously, he served as CFO of the Energy Division within Wasco Energy Group from
1 July 2013. He was formally appointed as CFO of Wasco Berhad on 1 May 2023.

He earned his ACCA qualification from the Association of Chartered Certified

Accountants United Kingdom, in 1994, and is a recognised Fellow. Additionally, he is
a member of the Malaysian Institute of Accountants.

Mr Ramanathan joined Wasco in June 2006 as Head of Group Internal Audit,

advancing to Group Financial Controller for the Energy Division in June 2008. Prior
to WB, he worked for 11 years at PricewaterhouseCoopers (“PwC”), Malaysia, until
2006.

Ariesza Noor
Chief Strategy Officer
47 years of age | Female | Malaysian | Appointed 1 March 2023

Ms Ariesza Noor, is the Chief Strategy Officer at WB since 1 March 2023. She joined
WB as Manager, Investor Relations in 2008.

She holds a Bachelor of Commerce (“Honors”) in Accounting & Finance from Lincoln
University, New Zealand, and is a Fellow of Certified Practising Accountant (“CPA”)
Australia.

She began her career in 1999 with Tenaga Nasional Berhad, where she held various
financial and accounting roles. In 2012, she joined IHH Healthcare Berhad as their
Vice President of Investor Relations and Corporate Communications where she played
a pivotal role in its listing. Ms Ariesza rejoined WB in 2014 and has served as the Vice
President, Group Strategy and Operations where she oversaw the Group’s branding,
marketing, strategic planning and M&A activities, apart from leading WB’s major pipe
coating operations in Malaysia. She has also served as Chief Corporate Officer of KPJ
Healthcare Berhad from 2021 until 2023.

Tay Hin Mian, Vivian

Chief Human Resources Officer
50 years of age | Female | Singaporean | Appointed 1 April 2023

Ms Vivian Tay assumed the role of Chief Human Resources Officer (“CHRO”) at WB
on April 1, 2023, after serving as Vice President of Group Human Resources since
September 2012.

She holds a Bachelor of Business in Human Resource Management from Nanyang

Technological University Singapore and is a Fellow of The Association of Certified
Chartered Accountant United Kingdom.

In 2005, Ms Tay commenced her journey with WB in Finance before assuming the
role of Finance Manager, Asia Pacific with Emerson Process Management in 2008.
She rejoined WB as Senior Finance Manager in 2010 and was appointed regional
Human Resource Business Partner in 2011.

Wasco Berhad 99
Profile of Key Senior Management Team

Iqbal Gopalsamy Abdullah

Vice President, Group Health, Safety and Environment
71 years of age | Male | Malaysian | Appointed 1 June 2015

Encik Iqbal Abdullah is the Vice President of Group Health, Safety and Environment
(“HSE”) of WB since 1 June 2015.

He attained his Bachelor of Economics (“Honours”) from the University of Malaya in

1975.

Encik Iqbal’s extensive career began in 1976 as Management Trainee in PETRONAS,

where he held various leadership roles in procurement, management development,
corporate planning, business development, risk management and safety
management. Prior to joining WB in 2012, he also held a senior management position
in customer relationship management at MISC Berhad.

Dr. Martyn Wilmott

Chief Executive Officer, Pipeline Services Division
63 years of age | Male | British/Canadian | Appointed in 2008

Dr. Martyn Wilmott, is the Chief Executive Officer of Wasco Pipeline Services
Group having rejoined the group in August of 2019. Dr. Wilmott was previously the
President of the Pipeline Services Division from 2008 until 2014.

From 2014 until 2019, Dr. Wilmott held the position of Vice President of Tubular
Product Technology with EVRAZ, the leading Steel and Pipe Manufacturing Company
in North America. Dr. Wilmott brings more than 30 years of energy, infrastructure
and manufacturing experience to his role having also held leadership positions with a
number of global companies. Dr. Wilmott is based in Dubai in the UAE.

Dr. Wilmott attained BSc, MSc and PhD degrees in Chemistry from the University of
Newcastle upon Tyne, England. Dr. Wilmott also holds an MBA from The University of
Manchester Alliance Manchester Business School, England.

Dr. Wilmott is the holder of 11 patents and has published over 70 technical articles
related to pipeline coatings and corrosion.

Shamugam Karupiah
Chief Executive Officer, Engineering & Fabrication Services Division
54 years of age | Male | Malaysian | Appointed 1 March 2016

Mr Shamugam Karupiah, has held the role of Executive Vice President for the
Engineering and Fabrication Division since 1 March 2016.

He attained his Bachelor’s Degree in Accounting from University Utara Malaysia in

1991, and commenced his career as an Assistant Accountant with Hong Leong
Group, Malaysia. Progressing within the group, he served as Finance Manager until
1998. Mr Karupiah joined Trox, a German MNC, in 1999 as Finance Director, he later
held positions including General Manager and Managing Director for their Asia Pacific
operations. Returning to Hong Leong Group in 2004, he served as Financial Controller
at their listed affiliate, Southern Steel Berhad. Transitioning to Wasco Energy in 2009
as Senior Financial Controller for the Engineering and Fabrication Division, he was
promoted to Vice President – Operations in 2014 before assuming his current role.

100 Integrated Annual Report 2023

 Profile of Key Senior Management Team

Lee Yee Chong

Chief Executive Officer, Bioenergy Services Division
(Industrial Engineering Unit)
56 years of age | Male | Malaysian | Appointed 1 March 2019

Mr Lee Yee Chong, has been the Chief Executive Officer for the Industrial Engineering
Unit (Wasco Thermal Sdn. Bhd. & Wasco Process Engineering Sdn. Bhd.) since 1
March 2019.

Mr Lee attained his Bachelor in Mechanical Engineering from University of Malaya

in 1993. Mr Lee started his career as project and commissioning engineer with ABB
Industrial Systems Sdn. Bhd. and subsequently joined Wasco Process Engineering
Sdn. Bhd. (formerly known as Jutasama Sdn. Bhd.) as project engineer in 1996.

Andrew Wong
Chief Executive Officer, Bioenergy Services Division
(Agro-based Industrial Unit)
41 years of age | Male | Malaysian | Appointed 1 April 2022

Mr Andrew Wong, has been the Chief Executive Officer of the Agro-based Industrial
Unit (Wasco AgroTech Sdn. Bhd.) since 1 April 2022.

Mr Wong attained his Bachelor of Science in Biology (Biomedical emphasis) from

Wichita State University, Wichita, Kansas, USA, in 2006 and began his career with
Deepwater Corrosion Services, Houston, USA, as a trainee and was subsequently
transferred to Wasco Lindung Sdn. Bhd. to handle the operations and project
management from 2007 until 2010.

Mr Wong assumed the role of Production Manager of PMT-Phoenix Industries

Sdn. Bhd. in 2012 and has since held various operational roles prior to his current
appointment.

Sivaramayah Sivalingam
Head, Group Internal Audit
52 years of age | Male | Malaysian | Appointed 1 August 2019

Mr Sivaramayah A/L Sivalingam is the Head of Group Internal Audit of WB since 1

August 2019. He reports to the Audit Committee and the Managing Director/Group
CEO of WB. His roles focus on evaluating and improving the effectiveness of risk
management, control and governance processes.

He holds a Bachelor in Accountancy (Hons.) from Universiti Utara Malaysia and

Master in Business Administration from the Universiti Kebangsaan Malaysia. He is
a member of the Institute of Internal Auditors Malaysia, the Malaysian Institute of
Accountants and the Malaysian Institute of Management.

With over 20 years of experience, he has held senior roles in internal auditing,
external auditing, risk management, quality management, cost accounting and
compliance. Over 15 years were spent in senior positions in internal audit in the Oil
and Gas industry, including Sapura Energy Berhad and Sumatec Resources Berhad.

Wasco Berhad 101

Profile of Key Senior Management Team

Lew Kok Cheong

Head, Group Treasury
56 years of age | Male | Malaysian | Appointed 1 June 2008

Mr Lew Kok Cheong is the Head Group Treasury of WB since 1 June 2008.

He attained his Bachelor of Economics from Monash Australia and has also read law
holding a LLB (Honours) from the University of London. He is a fellow member of CPA
Australia and a member of the Malaysian Institute of Accountants.

He began his career as a Senior Finance Manager since 2005. He assumed the current
Group Treasury lead since 2008 in addition to various other support roles from Finance,
Tax and Legal for the past 18 years.

Ooi Giap Hwa, Billy

Senior Vice President, Operation Finance
51 years of age | Male | Malaysian | Appointed 1 June 2023
Mr Billy Ooi has served as Senior Vice President, Operation Finance of WB since 1 June
2023. He previously holds the position of Head of Finance, Industrial Services Division
within the Wasco Group.

He holds a CPA from The Malaysian Institute of Certified Public Accountants and is a
member of both the Malaysian Institute of Certified Public Accountants and the Malaysian
Institute of Accountants.

Commencing his career as a Finance and Admin Manager in 2003, Mr Ooi progressed to
roles such as Financial Controller, Renewable Energy Division, and General Manager of
Wasco Thermal Sdn. Bhd. Prior to WB, he worked at Taliworks Corporation Berhad as a
Financial Accountant, following four years of articleship at BDO, gaining valuable technical
and financial expertise.

He is an indirect shareholder of Wasco Thermal Sdn. Bhd. by virtue of him holding 9.74%
in Tema Energy Ventures Sdn. Bhd., and in turn Tema Energy Ventures Sdn. Bhd. holds
40% shareholding in Wasco Thermal Sdn. Bhd. He also sits on the Board of a number of
subsidiaries within the Group. Hence, Mr Ooi shall abstain from all decision making for any
transactions that could potentially trigger conflict of interest with the Group.

Woo Ying Pun, Irene

Company Secretary
(Please refer to her profile under Corporate Governance Overview Statement)

Notes:-
Directorship in public/public listed companies
None of the Key Senior Management (“KSM”) members are holding any directorship in public/public listed companies
Family relationship with Directors and/or major shareholders
None of the KSM members have any relationship with any Directors and/or major shareholders of WB.
Conflict of interest
Saved as disclosed herein, none of the KSM members have any conflict of interest with WB.
Convicted of offences
None of the KSM members have been convicted for any offence within the past five (5) years other than possible traffic offences and have not
been imposed any public sanction or penalty by the relevant regulatory bodies during the financial year 2023.

102 Integrated Annual Report 2023

 Audit Committee

1. ROLE OF THE AUDIT COMMITTEE

The primary function of the Audit Committee (“AC”) is to assist the Board of Directors (“the Board”) in
fulfilling the following oversight objectives on the Group’s activities: -

• assess the Group’s processes relating to its risks and control environment;
• oversee financial reporting;
• review the internal and external audit reports;
• assess the suitability, objectivity and independence of the External Auditors; and
• review any conflict of interest situation that arise, persist or may arise within the Company and the
Group and the measures taken to resolve, eliminate or mitigate such conflicts.

The Terms of Reference (“TOR”), including the duties and responsibilities of the AC are available on the
Company’s website at www.wascoenergy.com.

The TOR was last reviewed by the Board on 27 February, 2024.

2. MEMBERS AND MEETINGS

The AC meets regularly at least five (5) times annually, with due notice of issues to be discussed and its
conclusions duly recorded in the minutes by the Group Company Secretary who is the Secretary of the AC
in attendance towards discharging of its duties and responsibilities. In the event the Secretary is unable to
attend any of the meetings, an assistant or deputy Secretary may be appointed for that specific meeting.
Additional meetings may be held at the request of the Board, the AC, the Management and the External or
Group Internal Auditors.

Nonetheless, the Chairman and the AC members have free and direct access to consult, communicate and
enquire with any Senior Management of the Group as well as the External Auditors at any time.

The Chief Financial Officer and the Head of Group Internal Audit attend such AC Meetings and the
representative of the External Auditors are encouraged to attend whenever possible. Other Directors may
be invited to attend such AC Meetings when necessary. The AC will meet the External Auditors at least
twice a year without the presence of any executive Board members and the Management.

The members and details of attendance of Directors at the AC Meetings of the Company for the financial
year ended 31 December 2023 are as follows: -

Date of No. of Meetings

Name of Director Directorship Appointment Attended
a Datin Wan Daneena Liza Binti Independent 23 May 2023 2/2
Wan Abdul Rahman Non-Executive Director
(Chairman)
b Halim Bin Haji Din Non-Independent 22 May 2002 4/5
(Member) Non-Executive Director*
Tan Sri Saw Choo Boon Senior Independent 30 August 2018 5/5
(Member) Non-Executive Director**
c Tan Sri Professor Lin See Yan Non-Independent 20 July 2004 3/3
(Member) Non-Executive Director*
c Tan Jian Hong, Aaron Non-Independent 3 June 2015 3/3
(Member) Non-Executive Director

* Redesignated as Non-Independent Non-Executive Director with effect from 23 May 2023.

** Appointed as Senior Independent Non-Executive Director with effect from 23 May 2023.
a Appointed as Chairman of AC with effect from 23 May 2023.
b Redesignated from Chairman to member of AC with effect from 23 May 2023.
c Resigned as member of AC with effect from 23 May 2023.

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Audit Committee

3. SUMMARY OF ACTIVITIES

During the financial year under review and up to the date of approval of this statement, the AC conducted
its activities in line with the TOR, as follows: -

3.1 Financial Reporting

In overseeing the Group’s financial reporting, the AC reviewed quarterly reports and the annual
audited financial statements of the Group before submission to the Board for consideration and
approval.

The Quarterly Financial Statements for the fourth quarter of 2022 and first, second, third and
fourth quarters of 2023, which were prepared in compliance with the Malaysian Financial Reporting
Standard 134 Interim Financial Reporting, International Accounting Standards 34 Interim Financial
Reporting and paragraph 9.22, including Appendix 9B of Bursa Malaysia Securities Berhad’s (“Bursa
Malaysia”) Main Market Listing Requirements (“MMLR”), were reviewed by the AC at the AC meetings
held on 23 February 2023, 23 May 2023, 21 August 2023, 28 November 2023 and 27 February
2024 respectively.

On 23 February 2023 and 27 February 2024 respectively, the AC reviewed the key findings by the
External Auditors, PricewaterhouseCoopers PLT (“PwC”), for the financial years ended 31 December
2022 and 31 December 2023. Subsequently on 13 April 2023 and 16 April 2024 respectively, the
AC reviewed the AC Report in respect of the significant audit, accounting and control matters in
respect of the audit for the financial years ended 31 December 2022 and 31 December 2023 as
presented by PwC together with the Audited Financial Statements of the Company and the Group for
the financial years ended 31 December 2022 and 31 December 2023.

The recommendations of the AC were presented to the Board for approval at the respective
subsequent Board meetings.

3.2 Annual Report and Circular to Shareholders

a. To ensure compliance with Bursa Malaysia’s MMLR, the AC reviewed and approved Wasco
Berhad’s (“WB”) Annual Report 2022 in particular the Management Discussion and Analysis,
Sustainability Statement, Audit Committee Report, Remuneration Committee Report, Nomination
Committee Report, Corporate Governance Overview Statement, Additional Compliance
Information, Statement on Risk Management and Internal Control, Statement of Directors’
Responsibilities and Summary of Significant Recurrent Related Party Transactions on 13 April
2023 and the same were recommended to the Board for their approval.

b. On 13 April 2023, the AC reviewed the Company’s Circular to Shareholders pertaining to the
following proposals prior to the Circular to Shareholders being printed and published on the
Company’s website: -

• Proposed renewal of shareholders’ mandate for the existing recurrent related party
transactions of a revenue or trading nature and provision of financial assistance between
the Company and/or its subsidiaries; and

• Proposed change of name from Wah Seong Corporation Berhad to Wasco Berhad.

c. The AC at the meeting held on 16 April 2024 reviewed and approved WB’s Annual Report
2023 in particular the Statement from the Chairman and the Managing Director/ Group Chief
Executive Officer, Statement from the Group Chief Executive Officer, Sustainability Report,
Nomination and Remuneration Committee Report, Governance, Compliance and Risk Committee
Report, Corporate Governance Overview Statement, Additional Compliance Information,
Statement on Risk Management and Internal Control, Statement of Directors’ Responsibility and
Summary of Significant Recurrent Related Party Transactions and the same were recommended
to the Board of Directors for their approval.

104 Integrated Annual Report 2023

 Audit Committee

d. On 16 April 2024, the AC reviewed the Company’s Circular to Shareholders pertaining to the
following proposal prior to the Circular to Shareholders being printed and published on the
Company’s website: -

• Proposed renewal of shareholders’ mandate for the existing recurrent related party
transactions of a revenue or trading nature and provision of financial assistance between
the Company and/or its subsidiaries.

e. On 16 April 2024, the AC reviewed the Company’s Share Buy-Back Statement and the proposed
authority to buy-back its own shares by the Company.

3.3 External Auditors

a. The AC at its meetings held on 23 February 2023 and 27 February 2023 respectively reviewed
the annual assessment of the performance of PwC in respect of the financial years ended 31
December 2022 and 31 December 2023 based on the following areas: -

• Calibre of External Auditors;

• Quality processes/performance;

• Audit team;

• Independence and objectivity;

• Audit scope and planning;

• Audit fees; and

• Audit communications.

Being satisfied with their performance, technical competency and audit independence, the AC
recommended the re-appointment of PwC as the External Auditors of the Company and the
Group for the financial year ended 31 December 2022 to the Board for approval accordingly.

The Board had since tabled the same to the Company’s shareholders for their approval at the
Annual General Meeting (“AGM”) of the Company held on 30 May 2023.

The AC further recommended the re-appointment of PwC as the External Auditors of the
Company and the Group for the financial year ended 31 December 2023 to the Board of
Directors for approval accordingly.

b. The AC had private meetings with the External Auditors on 23 February 2023, 21 August 2023
and 27 February 2024 respectively, without the presence of the Group Chief Executive Officer,
the Executive Directors, Senior Management and Internal Auditors.

There were no areas of concern raised by PwC that need to be escalated to the Board.

c. On 21 August 2023, the AC reviewed the Audit Plan prepared by the External Auditors for the
financial year ended 31 December 2023 outlining the detailed terms and responsibilities of
PwC and PwC’s affirmation of their independence as External Auditors, areas of audit emphasis
identified in response to changes within the Group’s business and the reporting requirements
during the financial year, on the ways PwC would continue to deliver an audit that is efficient
and effective while also keeping pace with the Group’s changes and in what way PwC intended
to work with the team from the Group.

d. On 23 February 2023, the AC acknowledged that PwC would communicate and obtain
concurrence from the AC on any engagement to be provided to WB, its parent company(s) and/
or its subsidiary(s) for the financial year 2022 and onwards. PwC would also report fee-related
matters at the year-end AC Meeting each year for the AC’s review.

Wasco Berhad 105

Audit Committee

e. On 23 February 2023 and 16 April 2024 respectively, the AC noted the PwC Malaysia
Transparency Report 2022 and the PwC Malaysia Transparency Report 2023 as tabled by PwC
in accordance with the compulsory annual transparency reporting for audit firms registered with
the Securities Commission’s Audit Oversight Board.

f. On 23 May 2023, the AC reviewed and approved the Non-Assurance Services (“NAS”)
Concurrence Policy (“NAS Policy”) of WB Group outlining the list of permissible NAS to be
provided by PwC. Any services not listed in the NAS Policy would be reviewed by the Chief
Financial Officer and relayed to the AC Chairman for concurrence.

g. On 21 August 2023 and 28 November 2023 respectively, the AC reviewed the list of approved
NAS provided by PwC for the financial year 2022 and 2023.

h. On 28 November 2023, the AC reviewed the WB Group Interim Audit Report presented by PwC
for the financial year ended 31 December 2023 which covered the scope of audit involving the
tests of controls over Management’s processes surrounding revenue and receivables, purchases
and payables, treasury, payroll and inventory cycles and test of details performed on certain
subsidiaries within the Group.

i. The AC had obtained confirmation from the External Auditors confirming their independence and
that they were not aware of any non-audit services that had compromised their independence
as External Auditors of the Group throughout their terms of engagement for the financial year
under review.

3.4 Recurrent Related Party Transactions

a. On 23 February 2023, 23 May 2023, 21 August 2023, 28 November 2023 and 27 February
2024 respectively, the AC reviewed all related party transactions and recurrent related party
transactions to ensure that they were within the mandate obtained from the shareholders of the
Company.

b. The AC at its meetings held on 13 April 2023 and 16 April 2024 respectively reviewed the
proposed renewal of shareholders’ mandate for the existing recurrent related party transactions
of a revenue or trading nature and provision of financial assistance between the Company and/
or its subsidiaries for inclusion in the Circular to Shareholders pursuant to Bursa Malaysia’s
MMLR for the Board’s approval.

3.5 Risk Management

On 23 February 2023 and 23 May 2023 respectively, the AC reviewed and deliberated on the
key and significant risks presented and discussed at the respective Risk Management Committee
meetings held quarterly taking into consideration of the Group risks profile and risk appetite and the
mitigation measures to be taken.

On 23 May 2023, the AC proposed for oversight of the Risk Management Committee to be delegated
to the new Governance, Compliance and Risk Committee to be established to increase the focus on
risk-related matters.

3.6 Internal Audit

a. On 23 February 2023, 23 May 2023, 21 August 2023, 28 November 2023 and 27 February
2024 respectively, the AC reviewed the major findings in the Internal Audit Reports prepared by
the Group Internal Audit together with the recommendations and the Management’s response to
the findings.

b. On 28 November 2023, the AC reviewed the Group Internal Audit Plan for the financial year
2024 (“FY 2024”) which encompassed the proposed audit engagements, proposed entities
and processes with scope of audit, estimated Audit Man-days, proposed budget for FY 2024,
proposed key performance indicators, organisation chart of Group Internal Audit, confirmation
of independence, quality assurance review, reliance of work on other assurance providers and
subject matter experts and performance review for the financial year 2023.

106 Integrated Annual Report 2023

 Audit Committee

3.7 Capital Expenditure

On 23 February 2023 and 27 February 2024 respectively, the AC reviewed the total capital
expenditure incurred by WB Group for the financial years ended 31 December 2022 and 31
December 2023.

On 23 May 2023 and 21 August 2023 respectively, the AC reviewed the capital expenditures
incurred during the financial year 2023 on a quarterly basis to ensure that the expenditures were
within the approved budget for the financial year under review.

On 28 November 2023, the AC reviewed the proposed annual capital expenditures and annual
budget of the Group for FY 2024 before tabling to the Board for discussion and approval.

3.8 Conflict of Interest

The Conflict of Interest Policy was established on 27 February 2024 to ensure that actual, potential
and perceived conflict of interest (“COI”) are identified and managed effectively as it provides
guidance on how to deal with COI situations as they arise and protect the Group’s interest, while
assisting the Directors and employees to perform with high integrity and ethical standards.

A Conflict of Interest Declaration Form was circulated to all Directors and Key Senior Management
for them to disclose and declare their nature and extent of COI (if any) based on actual, potential
and perceived COI. The compiled forms were tabled to and reviewed by the AC to determine the COI
disclosed and the measure required to be taken to resolve, eliminate or mitigate the conflicts (if any)
before the details of the COI are reported to the Board.

The Directors and Key Senior Management would inform the Company immediately should their
circumstances change in any way that affects their COI declaration.

4. INTERNAL AUDIT FUNCTION

The AC is assisted by the Group Internal Audit (“GIA”) in providing independent and objective assurance
to the Group to accomplish its objectives by bringing a systematic, disciplined approach to evaluate
and improve the effectiveness of risk management, control and governance. The Head of GIA reports
functionally to the AC and administratively to the Managing Director/Group Chief Executive Officer.

The GIA had conducted risk-based audit engagements as stipulated in the annual Internal Audit Plan for
financial year 2023 (“FY 2023”). Significant audit findings with regards to risk, control and governance
covered various scope which had high risk and impact were discussed with senior management, of
which also including the agreed action plans committed by the line management. The audit reports were
presented quarterly to the AC for deliberation. Follow up review on the audit engagements were also
conducted on every quarter to ensure proper and effective remedial actions have been taken by the line
management to close existing control gaps, risk and governance related issues highlighted by the GIA. All
the internal audit activities and processes were performed as guided by the Internal Audit Charter and
the GIA Standard Operating Procedure. The GIA is in conformance with the International Standards for the
Professional Practice of Internal Auditing.

A summary of the internal audit activities performed during the financial year under review are as follows:-

a. completed 8 risk-based audit engagements and special audit reviews that were presented to the
AC. The review primarily focused on operations, and business entities of the Group to ascertain the
adequacy and effectiveness of risk, control and governance processes;

b. performed follow-up review on quarterly basis to assess the adequacy, effectiveness and timeliness
of actions taken by the line management;

c. completed internal Self-Assessment on Quality Assurance and Improvement Programme (QAIP);

d. tabled the Annual Audit Plan and budget for FY 2023 to AC for review and approval; and

e. presented the Internal Audit Charter to AC for annual review and approval.

The total costs incurred in FY 2023 for GIA amounted to RM1,006,176 (2022: RM876,415).

Wasco Berhad 107

Nomination and Remuneration Committee

The Nomination Committee and Remuneration Committee of the Company have been merged into a new Board
Committee known as the Nomination and Remuneration Committee with effect from 23 May 2023.

1. MEMBERS AND MEETING

The members and details of attendance of Directors at the Nomination Committee (“NC”), Remuneration
Committee (“RC”) and Nomination and Remuneration Committee (“NRC”) Meetings of the Company for the
financial year ended 31 December 2023 are as follows:-

1.1 Nomination Committee (prior to merging with RC on 23 May 2023)

Date of No. of Meetings

Name of Director Directorship Appointment Attended
a Tan Sri Professor Lin See Yan Non-Independent 25 August 2014 2/2
(Chairman) Non-Executive Director*
b Tan Sri Saw Choo Boon Senior Independent 25 February 2/2
(Member) Non-Executive Director** 2019
c Halim Bin Haji Din Non-Independent 22 May 2002 2/2
(Member) Non-Executive Director*
d Tan Jian Hong, Aaron Non-Independent 1 June 2021 2/2
(Member) Non-Executive Director

1.2 Remuneration Committee (prior to merging with NC on 23 May 2023)

Date of No. of Meetings

Name of Director Directorship Appointment Attended
b Tan Sri Saw Choo Boon Senior Independent 25 February 2/2
(Chairman) Non-Executive Director** 2019
a Tan Sri Professor Lin See Yan Non-Independent 25 August 2014 2/2
(Member) Non-Executive Director*
c Halim Bin Haji Din Non-Independent 22 May 2002 2/2
(Member) Non-Executive Director*

1.3 Nomination and Remuneration Committee

Date of No. of Meetings

Name of Director Directorship Appointment Attended
b Tan Sri Saw Choo Boon Senior Independent 23 May 2023 1/1
(Chairman) Non-Executive Director**
a Tan Sri Professor Lin See Yan Non-Independent 23 May 2023 1/1
(Member) Non-Executive Director*
e Lily Rozita Binti Mohamad Khairi Independent 23 May 2023 1/1
(Member) Non-Executive Director

* Redesignated from Independent Non-Executive Director to Non-Independent Non-Executive

Director with effect from 23 May 2023
** Appointed as Senior Independent Non-Executive Director with effect from 23 May 2023.
a Redesignated as a member of NRC with effect from 23 May 2023.
b Appointed as Chairman of NRC with effect from 23 May 2023.
c Resigned as member of NC and RC respectively with effect from 23 May 2023.
d Resigned as member of NC with effect from 23 May 2023.
e Appointed as member of NRC with effect from 23 May 2023.

108 Integrated Annual Report 2023

 Nomination and Remuneration Committee

2. ROLE OF THE NOMINATION AND REMUNERATION COMMITTEE

The NRC is responsible for assessing and making recommendations on any new appointments to the
Board and its various Board Committees as well as the Directors who are retiring by rotation to be put
forward for re-election.

The NRC shall set the policy framework and:-

a) Recommend to the Board, candidates for all directorships to be filled by the shareholders or the
Board after considering the candidates’:-

- skills, knowledge, expertise and experience;

- professionalism;
- integrity; and
- in the case of candidates for the position of Independent Non-Executive Directors, to evaluate
the candidates’ ability to discharge such responsibilities/functions as expected from the
Independent Non-Executive Directors.

b) Consider, in making its recommendations, candidates for directorships proposed by the Chief
Executive Officer and within the bounds of practicability, by any other senior executive or any
director or shareholder;

c) Recommend to the Board, directors to fill the seats on Board Committees;

d) Promote a diverse Board composition which includes at least one (1) women Director on the Board,
as required under the Main Market Listing Requirements (“MMLR”);

e) Review the participation of women in Senior Management to ensure there is healthy talent pipeline;
and

f) Oversee the effective succession planning, talent management and human capital development for
the Board and key officers.

The NRC shall also set the policies and procedures to determine the remuneration of Wasco Berhad’s
(“WB”) Board of Directors and Senior Management, drawing from outside advice as necessary with the
objective of ensuring:-

a) that the Company’s Directors and Senior Management are fairly rewarded for their individual
contributions to the Company’s overall performance;

b) that the levels of remuneration should be sufficient to attract and retain the Directors and Senior
Management needed to run the Company successfully;

c) that the levels and composition of remuneration of Senior Management take into account the
Company’s intention to attract and retain the right talents to drive the Company’s long-term
objectives; and

d) that the levels of remuneration for Directors and Senior Management are based on the Company’s
performance in managing material sustainability risks and opportunities.

The determination of remuneration packages of Non-Executive Directors, including Non-Executive

Chairman should be a matter for the Board as a whole.

The individuals concerned should abstain from discussion of their own remuneration.

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Nomination and Remuneration Committee

3. TERMS OF REFERENCE

i. Composition

The NRC shall be chaired by an independent Director and its members shall comprise exclusively of
Non-Executive Directors, a majority of whom are independent.

The Chairman of the Board does not serve on the NRC to ensure check and balance as well as
objective review by the Board. The Chairman of the Board shall not participate by way of invitation in
the NRC meetings.

ii. Quorum of Meetings

A minimum of two (2) NRC Members present physically or virtually shall constitute the quorum.

Any other person(s) may be invited by the NRC and/or the NRC Chairman from time to time to attend
the NRC meeting.

iii. NRC Members

The existing NRC Members are as disclosed above.

iv. Majority Decision

All decisions of the NRC shall be decided on the votes of the simple majority of those Members
present physically or virtually.

Any decision or recommendation made by the NRC shall be subject to the review and ultimate
approval of the Company’s Board of Directors.

The Director(s) concerned should abstain from discussion on their own remuneration and/or
nomination.

v. Casting Vote

In the event there be an equality of votes, then the Chairman of the meeting shall have a casting
vote.

vi. Frequency of Meetings

The NRC shall meet at least annually or at such other frequency as the Chairman may determine.

vii. Notice of Meetings

Minimum seven (7) days or such shorter notice as the NRC may deem fit depending on the nature
and prevailing circumstances at hand.

viii. Secretary

The Group Company Secretary shall be the Secretary for the NRC. In the event that the Group
Company Secretary is unable to attend, an assistant or deputy Secretary(s) may be appointed for
that specific meeting.

ix. Minutes of Meetings

The Secretary (which expression shall include the assistant or deputy Secretary appointed under
item viii) shall table the Minutes of each NRC Meeting and shall circulate the same for each Member’s
record. The Chairman’s confirmation of the Minutes shall be taken as a correct record of the
proceedings thereat.

The Chairman of the NRC shall report on the outcome and decision of each meeting to the Board.

110 Integrated Annual Report 2023

 Nomination and Remuneration Committee

x. Directors’ Fit and Proper Policy

The Directors’ Fit and Proper Policy was established on 23 May 2022 to guide the NRC, the
Managing Director/Group Chief Executive Officer and Deputy Managing Director in the appointment
and re-appointment/re-election of Directors, Chief Executive Officers and Chief Financial Officers of
the WB Group based on a list of fit and proper criteria.

During the financial year under review, the NRC reviewed and assessed candidates for new Board
members prior to their appointment and the existing Board members who are due for retirement by
rotation and are eligible for re-election, based on the fit and proper criteria stated in the Directors’
Fit and Proper Policy. The NRC was satisfied with the outcome of the assessments and duly
recommended the respective appointments/re-elections of the Board candidates/members to the
Board of Directors for approval.

The terms of the Directors’ Fit and Proper Policy are reviewed and updated from time to time
to ensure that they are relevant and in line with the requirements of all relevant acts, rules and
guidelines currently in force. The Directors’ Fit and Proper Policy is available on the Company’s
website at www.wascoenergy.com.

xi. Diversity Policy

The Diversity Policy was established on 27 November 2018 to promote diversity in the Company and
Group’s Board of Directors, Senior Management and workforce whereby gender diversity is essential
to attain effective strategic objectives of the Group, to enhance sustainable growth and development,
and to promote better corporate governance.

The terms of the Diversity Policy are reviewed and updated from time to time to ensure that they are
relevant and in line with the requirements of all relevant acts, rules and guidelines currently in force.
The Diversity Policy is available on the Company’s website at www.wascoenergy.com.

xii. Roles of the Chairman of NRC

The Chairman of the NRC shall lead the succession planning and appointment of Directors and
oversee the development of a diverse pipeline for board and management succession, including the
future Chairman, Executive Directors and Chief Executive Officer. The Chairman shall also lead the
annual review of board effectiveness, ensuring that the performance of each individual Director and
Chairman of the Board Committee are independently assessed.

The Chairman shall also assess the Board’s effectiveness and the contribution of each individual
Director independently in the discharge of their duties and responsibilities.

xiii. Functions of the NRC

Without prejudice to the generality of the foregoing, the NRC shall:-

a. Determine the core competencies and skills required of Board members to best serve the
business and operations of the Group as a whole and the optimum size of the Board to reflect
the desired skills and competencies;

b. To review and assess the skills, expertise, experience, gender, age, ethnicity, time commitment
and independence of its Directors to ensure their relevance and the efficiencies and
effectiveness of the Board as a whole including its effectiveness in promoting a diverse Board
composition which includes appropriate number of woman Director(s), as required under the
MMLR of Bursa Malaysia Securities Berhad (“Bursa Malaysia”) and addressing the Group’s
material sustainability risks and opportunities;

c. Review the size of Non-Executive participation, Board balance and determine if additional
Board members are required and also to ensure that at least one-third (1/3) of the Board is
independent;

Wasco Berhad 111

Nomination and Remuneration Committee

d. To assess the independency of the Independent Directors;

e. Recommend to the Board on the appropriate number of Directors to compose the Board which
should fairly reflect the investments of the minority shareholders in the Company, and whether
the current Board representation satisfies this requirement;

f. Recommend to the Board, candidates for directorships to be filled by the shareholders or the
Board;

g. Consider in making its recommendations, candidates for directorships proposed by the Chief
Executive Officer and, within the bounds of practicability, by any other senior executive or any
Director or shareholder;

h. Consider utilizing independent sources in the event suitable candidates could not be sourced
from recommendations;

i. Recommend to the Board, Directors to fill the seats on Board Committees;

j. Undertake an annual review of the required mix of skills and experience and other qualities of
Directors, including core competencies which Non-Executive Directors should bring to the Board
and to disclose this forthwith in every Annual Report;

k. Assist the Board to introduce criteria and to formulate and implement a procedure to be carried
out by the NRC annually for assessing the effectiveness of the Board as a whole, the Board
Committees and for assessing the contributions of each individual Director;

l. Introduce any regulation which would enable the smooth administration and effective discharge
of the NRC’s duties and responsibilities;

m. To furnish a report to the Board of any findings of the NRC;

n. To recommend to the Board for continuation or discontinuation in service of Directors as an

Executive Director or Non-Executive Director;

o. To recommend Directors who are retiring by rotation to be put forward for re-election;

p. To recommend to the Board the employment of the services of such advisers as it deems
necessary to fulfill the Board’s responsibilities;

q. To review the term of office and performance of the Audit Committee and each of its members
annually;

r. To review the appointment and termination of key officers of the Group as follows:-

- Head Office – Group Chief Executive Officer, Deputy Chief Executive Officer, Chief
Financial Officer, Chief Operating Officer, Group Company Secretary;

s. To review the appointment, re-appointment/re-election and resignation of Directors on the

Board of the Company and of its subsidiaries, where necessary;

t. To review the composition, quality, capacity, competencies and effectiveness of the Board of
the subsidiaries, where necessary;

u. To review the participation of women in Senior Management to ensure that there is a healthy
talent pipeline;

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 Nomination and Remuneration Committee

v. Review, recommend and advise on all forms of directors’ remuneration e.g.

- Basic Salary
- Profit-sharing schemes (if any)
- Share options
- Any other benefits;

w. To establish fair, formal and transparent procedures for developing a policy for Board of
Directors and Senior Management’s remuneration and for fixing the remuneration packages of
individual Directors and Senior Management;

x. To determine the appropriate level of remuneration for Board of Directors and Senior
Management based on the Company’s performance in managing material sustainability risks and
opportunities;

y. To structure the component parts of the Executive Directors’ remuneration so as to link rewards
to corporate and individual performance; whereas, in the case of Non-Executive Directors, the
level of remuneration should reflect the experience and level of responsibilities undertaken by
the particular Non-Executive Director concerned;

z. Conduct continued assessment of individual Executive Directors to ensure that remuneration is

directly related to performance over time. In this regard, the review of Non-Executive Directors’
fees may take place at a different time of the year from the review of Executive Directors’
salaries;

aa. To monitor and assess the suitability of such proposed performance related formula (e.g.
whether the formula is based on individual performance, company profit performance,
earnings per share, etc.) and to see that awards under the Company’s share option schemes
are consistent with the Company’s overall performance and provide an additional incentive to
Management;

bb. To provide an objective and independent assessment of the benefits granted to Executive
Directors;

cc. To ensure that there are adequate pension arrangements for the Executive Directors;

dd. To consider, the extent of the details of the Board of Directors and Key Senior Management’s
remuneration to be reported in the Company’s Annual Report in compliance with the Malaysian
Code on Corporate Governance 2021 (“MCCG 2021”) and the MMLR of Bursa Malaysia;

ee. Introduce any regulation which would enable the smooth administration and effective discharge
of the NRC’s duties and responsibilities;

ff. To furnish a report to the Board of any findings of the NRC;

gg. Engage or appoint such other competent and professional advisers/consultants as may be
deemed fit to assist the NRC in the smooth discharge of its duties herein;

hh. To review the Remuneration Policy/Framework for the Board of Directors and Senior
Management of the Group in order to attract and retain key personnel of requisite quality that
increases productivity and profitability in the long run. The Remuneration Policy is available on
the Company’s website at www.wascoenergy.com;

ii. The Remuneration Policy and procedures determines the remuneration of Directors and Senior
Management which takes into account the demands, complexity and performance of the
Company as well as the skills and experience required and which properly reflect the different
roles and responsibilities of the Executive Directors, Non-Executive Directors and Senior
Management accordingly;

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Nomination and Remuneration Committee

jj. To review and determine the appropriate remuneration package for the Board of Directors and
Key Senior Management of the Group as follows:-

- Head Office – Group Chief Executive Officer, Deputy Chief Executive Officer, Chief
Financial Officer, Chief Operating Officer, Group Company Secretary;

kk. To review the salary increment or adjustment in the event of promotion or redesignation of Key
Senior Management of the Group, where necessary;

ll. To review the annual increment and bonus payment for Key Senior Management of the Group
basing on the performance of the Group and performance of the individuals, where necessary;

mm. To establish schemes, options and remuneration and compensation plans for the Board of
Directors and Key Senior Management of the Group, where appropriate; and

nn. Generally, to decide and implement such other matters as may be delegated by the Company’s
Board of Directors from time to time.

xiv. Independent Director

The definition and requirements of an “Independent Director” are in accordance with Chapter 1 and
Practice Note 13 of the MMLR of Bursa Malaysia, and includes the recommended best practices in
corporate governance as provided in the MCCG 2021.

xv. Succession Planning for Board and Key Officers

The NRC shall develop an effective succession planning framework, talent management programme,
and human capital development process for the Board and the key officers of the Company.

The NRC shall oversee the succession planning for the Board members and the key officers.

xvi. Review of the Terms of Reference

The NRC shall review the Terms of Reference from time to time to ensure its relevance and to
consider any amendment/improvement(s) thereto as and when the NRC deems necessary. Any
variation/amendment(s) to the Terms of Reference shall be recommended to the Board of Directors
for endorsement and adoption.

The Terms of Reference of NRC was established by the Board of Directors on 23 May 2023 and is
available on the Company’s website at www.wascoenergy.com.

4. BOARD’S EFFECTIVENESS ASSESSMENT

The NRC conducted an annual assessment of the Board’s effectiveness as a whole and the contribution
of each individual Director in respect of the financial year ended 31 December 2023 using a set of
customised self-assessment questionnaires to be completed by the Directors. The results of the self-
assessment by Directors and the Board’s effectiveness as a whole as compiled by the Group Company
Secretary were tabled to the Board for review and deliberation.

The Board was satisfied with the results of the annual assessment and that the current size and
composition of the Board is appropriate and well-balanced with the right mix of skills with the Board
composition comprising individuals of high calibre, credibility and with the necessary skills and
qualifications to enable the Board to discharge its responsibility effectively.

Assessment was also conducted on the Board Committees’ effectiveness based on a set of questionnaires
to be completed in respect of the financial year ended 31 December 2023 and the NRC was pleased with
the outcome of the said assessment.

The NRC is satisfied with the existing Board composition with regards to the mix of skills, experience,
expertise and independence in meeting the required needs of the Company taking into consideration
the gender diversity and ethnicity of the members of the Board. The Board is supported by the core
Management team having the relevant and appropriate qualifications, experience and competencies in
their respective roles and functions.

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 Nomination and Remuneration Committee

5. INDEPENDENCE ASSESSMENT OF THE INDEPENDENT DIRECTORS

The NRC had conducted an independence assessment of the Independent Directors in respect of the
financial year ended 31 December 2023 and the NRC was satisfied with the results whereby all the
Independent Directors fulfilled the criteria for an Independent Director as prescribed under the MMLR of
Bursa Malaysia.

6. REVIEW OF THE AUDIT COMMITTEE

Pursuant to Paragraph 15.20 of Chapter 15 of the MMLR of Bursa Malaysia, the NRC had conducted a
review on the terms of office and performance of the Audit Committee and each of the members annually
and was of the opinion that the Audit Committee and each of the members have carried out their duties in
accordance with their Terms of Reference.

7. FINANCIAL LITERACY OF AUDIT COMMITTEE MEMBERS

Pursuant to Practice 9.5 of the MCCG 2021, the NRC had conducted the financial literacy assessment for
each of the Audit Committee members based on a set of questionnaires to be completed in respect of the
financial year ended 31 December 2023 and the NRC was pleased with the outcome of the assessment.

8. WOMAN DIRECTOR ON BOARD

The Board had on 7 April 2023 and 12 April 2023 respectively appointed a total of two (2) women
Directors on the Board of Wasco Berhad as recommended by the NRC.

9. CONFLICT OF INTEREST

The Conflict of Interest Policy is established and approved by the Board of Directors on 27 February 2024.
All Directors and Key Senior Management have completed the Conflict of Interest Declaration Form to
disclose and declare their nature and extent of conflict of interest (“COI”) (if any) based on actual, potential
and perceived COI. These forms are compiled and tabled to the Audit Committee to determine the COI
disclosed and the measures required to be taken to resolve, eliminate or mitigate the conflicts (if any). The
details of the COI are then reported to the Board.

All COI declarations made by the Directors and Key Senior Management and the measures taken to
resolve, eliminate or mitigate the conflicts (if any) are recorded, maintained and properly documented. The
Directors and Key Senior Management would also update the Company immediately should circumstances
change in any way that affect their earlier COI declared.

The COI declared by the Directors and Key Senior Management and the measures taken to resolve,
eliminate or mitigate such conflicts (if any) are disclosed in the Profile of Board of Directors on page 94
and the Profile of Key Senior Management Team on page 99 of this Annual Report respectively.

10. COMPLIANCE WITH THE MMLR

The new Board composition as at 12 April 2023 fulfilled the MMLR requirements to have at least one (1)
woman Director on Board. Two (2) Independent Non-Executive Directors who had exceeded the twelve
(12) years tenure had been redesignated as Non-Independent Non-Executive Directors with effect from
23 May 2023. One third of the Board of Directors are Independent Non-Executive Directors.

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Governance, Compliance and Risk Committee

The Governance, Compliance and Risk Committee of the Company is established on 23 May 2023.

1. MEMBERS AND MEETING

The members and details of attendance of Directors at the Governance, Compliance and Risk Committee
(“GCRC”) Meetings of the Company for the financial year ended 31 December 2023 are as follows:-

Date of No. of Meetings

Name of Director Directorship Appointment Attended
Lily Rozita Binti Mohamad Khairi Independent 23 May 2023 2/2
(Chairman) Non-Executive Director
Tan Sri Professor Lin See Yan Non-Independent 23 May 2023 2/2
(Member) Non-Executive Director*
Datin Wan Daneena Liza Binti Wan Independent 23 May 2023 2/2
Abdul Rahman (Member) Non-Executive Director

* Redesignated as Non-Independent Non-Executive Director with effect from 23 May 2023.

2. ROLE OF THE GOVERNANCE, COMPLIANCE AND RISK COMMITTEE

The GCRC assists the Board in fulfilling its corporate governance and oversight responsibilities in relation
to the relevant Acts, Laws, Requirements, Codes, Regulations and Policies governing the Company and
oversees the development and implementation of the Group’s sustainability-related framework, anti-bribery
and corruption compliance, risk management framework and its related policies.

The GCRC investigates any matters within its terms of reference and as authorised by the Board, including
seeking any information from any parties and to obtain outside legal or other independent professional
advice at the Company’s expense if the GCRC considers necessary.

The GCRC reports and updates the Board on matters and findings by the GCRC and makes the necessary
recommendations to the Board within its terms of reference or as authorised by the Board.

3. TERMS OF REFERENCE

i. Composition

The GCRC shall be chaired by an Independent Director and its members shall comprise exclusively of
Non-Executive Directors, a majority of whom are independent.

The Chairman of the Board does not serve on the GCRC to ensure check and balance as well as
objective review by the Board. The Chairman of the Board shall not participate by way of invitation in
the GCRC meetings.

The GCRC comprises of three (3) sub-committees, namely: -

(i) Sustainability Steering Committee;

(ii) Integrity Committee; and
(iii) Risk Management Committee.

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 Governance, Compliance and Risk Committee

ii. Quorum of Meetings

The contemporaneous linking together by electronic telecommunication media or audio-visual

communication or wireless application protocol (“WAP”) of a minimum of two (2) GCRC members shall
be deemed to constitute a meeting of the members wherever in the world they are on the day and
time at which (using Malaysia time) the conference is held, as long as:

(a) The quorum of members is met;

(b) At the commencement of the meeting, each member acknowledges the presence of all the
other members taking part and such participation shall be deemed to be presence in person;

(c) Each of the member taking part is able to be heard and hear each of the subject as hereinafter
mentioned throughout the meeting;

(d) None of the members present at the commencement of the meeting leaves the meeting by
disconnecting the electronic communication media, but the meeting shall be deemed to have
been conducted validly notwithstanding that the electronic communication media or WAP
used by any one or more of the members is accidentally disconnected during the meeting and
provided that a quorum of members continues to be present and acts throughout during the
period of disconnection. If at any time, a quorum of members is no longer present, the Chairman
of the meeting shall declare that the meeting is adjourned but only after having given ample
time for the relevant member(s) to re-join the meeting; and

(e) All information and documents are made equally available to all participants prior to or during
the meeting.

Any other person(s) may be invited by the GCRC and/or the GCRC Chairman from time to time to
attend the GCRC meeting.

iii. GCRC Members

The existing GCRC members are as disclosed above.

iv. Majority Decision

All decisions of the GCRC shall be decided on the votes of simple majority of the members present
physically or virtually.

Any decision or recommendation made by the GCRC shall be subject to the review and ultimate
approval of the Company’s Board of Directors.

v. Casting Vote

In the event there be an equality of votes, then the Chairman of the meeting shall have a casting
vote.

vi. Frequency of Meetings

The GCRC shall meet at least twice (2) a year or at such other frequency as the Chairman may
determine.

vii. Notice of Meetings

Minimum seven (7) days or such shorter notice as the GCRC may deem fit depending on the nature
and prevailing circumstances at hand.

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Governance, Compliance and Risk Committee

viii. Secretary

The Group Company Secretary shall be the Secretary for the GCRC. In the event that the Group
Company Secretary is unable to attend, an assistant or deputy Secretary(s) may be appointed for
that specific meeting.

ix. Minutes of Meetings

The Secretary (which expression shall include the assistant or deputy Secretary appointed under item
viii) shall table the Minutes of each GCRC Meeting and shall circulate the same for each Member’s
record. The GCRC Chairman’s confirmation of the Minutes shall be taken as a correct record of the
proceedings thereat.

The Chairman of the GCRC shall report on the outcome or decision of each meeting to the Board.

x. Resolution in Writing

A resolution in writing, signed or assented to by a majority of the members who are sufficient to form
a quorum, shall be valid and effectual as if it had been passed at a meeting of the committee duly
convened.

Any such resolution may consist of several documents, in similar form and each document shall be
signed or assented to by one or more members including via electronic mail or any of electronic
approval or electronic signature via software, electronic devices or other means of communication
apparatus or devices.

A copy of any such resolutions shall be forwarded or otherwise delivered to the Company Secretary
and shall be recorded by the Company Secretary in the minutes book.

xi. Responsibilities and Duties of the GCRC

The GCRC undertakes oversight of the following: -

A. Corporate Governance, Compliance, Regulatory, Tax and all relevant compliance matters of the
Company

(a) Evaluate and monitor the Company’s compliance with the relevant Acts, Laws,
Requirements, Codes, Regulations and Policies governing the Company;

(b) Review the assessment of the alignment to the relevant regulatory standards in the
Company’s systems, controls and conduct of business;

(c) Receive and consider reports of non-compliance by the Company from the external service
providers i.e. the auditors, legal advisors, agents, consultants and external parties with
any relevant Acts, Laws, Requirements, Codes, Regulations and Policies governing the
Company;

(d) Ensure the Company’s tax matters are managed in line with the relevant tax legislations
and the Company’s overall approach to governance and transparency while ensuring
stakeholders interest are protected;

(e) Review new legal, regulatory, tax and compliance requirements and standards;

(f) Ensure the Board is informed of upcoming changes in corporate governance, regulations
or compliance requirements and the needful plans are put in place to ensure that the
Company is ready for the needful changes;

(g) Provide oversight of the Company’s relationships with its regulators; and

(h) Assess and ensure that the Board and the Board Committees have adequate time, updated
information and resources to fulfil their fiduciary duties towards the Company.

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B. Anti-bribery and Corruption Compliance

(a) oversight of development and implementation of the Group’s Principles of Business

Conduct, Anti-Bribery and Corruption Policy (“ABC Policy”), Anti-Bribery Management
System (“ABMS”), Whistle Blowing Policy in relation to anti-bribery and corruption, whistle
blowing and non-financial risks;

(b) advise the Board and the Management on the anti-bribery and corruption, legislative and
regulatory landscape to ensure compliance;

(c) introduce any regulation which would enable the smooth administration and effective
discharge of the Integrity Committee’s duties and responsibilities;

(d) review the adequacy of compliance programme of the Group and the implementation
of the relevant anti-bribery and corruption control measures, including but not limited
to, due diligence process, compliance checks and monitoring, as well as the authorities’
raid procedures, to ensure ongoing awareness programme, communication, training and
education on compliance disseminated to all employees, consultants, associates, suppliers
and stakeholders of the Group;

(e) review the ABMS from time to time to ensure that the Group is in compliance with the
Malaysian Anti-Corruption Commission Act 2009, the Companies Act 2016, the Main
Market Listing Requirements (“MMLR”) of Bursa Malaysia Securities Berhad (“Bursa
Malaysia”) and other legislative and reporting requirement;

(f) identify the bribery and corruption risks which the Group might reasonably anticipate and
furnish the bribery risk assessment and the report to the Board of any findings by the
GCRC;

(g) inquire into any allegation of bribery or act of corruption and ensure appropriate actions
are taken;

(h) supervise, monitor and manage the complaints received pertaining to bribery, corruption,
abuse of power, malpractice and violation of business conduct within the Group;

(i) monitor and review the development and implementation of the anti-bribery and
corruption, legislative and regulatory landscape by the Integrity Committee. The GCRC to
ensure that they are appropriate, effective, adequately enforced and conformance to the
requirements of ISO37001:2016 standard; and

(j) perform any other activities relating to anti-bribery and corruption, as authorised by the
Board.

C. Risk Management and Internal Control

(a) oversee, review and monitor the duties and responsibilities of the Risk Management
Committee (“RMC”);

(b) assess the scope and effectiveness of the systems and processes established by the
RMC;

(c) identify, assess, manage and monitor areas of material business risks of the Group,
financial and non-financial risks;

(d) develop and ensure the systems and processes in identifying, assessing, treating,
monitoring and reporting the business risks are continuously improved;

(e) oversee the conduct, and review the results of the Group’s risk assessment including the
identification and reporting of critical risks;

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Governance, Compliance and Risk Committee

(f) conduct annual review and periodic testing of the Company’s internal control and risk
management framework;

(g) advise the Board on the Group’s current risk exposures and futures risk strategy based on
its overall risk appetite;

(h) recommend the risk policy including the setting of risk management authorities, limits and
escalation procedures to the Board;

(i) provide guidance and strategic direction to the business units on the adequacy and
effectiveness of internal control systems for identification and mitigation of material
business risks;

(j) establish procedures in conjunction with the respective business units to ensure
identification of and compliance with relevant laws, licensing and regulatory requirement;

(k) liaise where necessary with the Legal and Internal Audit functions of the Group; and

(l) undertake any other risk management tasks as may be delegated by the Board to the
Committee.

D. Sustainability

(a) oversee, review and monitor the duties and responsibilities of the Sustainability Steering
Committee (“SSC”);

(b) oversee the formulation of the Group’s overall sustainability framework and strategies,
including principles and policies which are aligned with related regulations and standards;

(c) monitor the implementation of the Group’s overall sustainability framework, principles,
policies, initiatives, activities, strategies, and plan undertaken or implemented;

(d) review and recommend to the Board the development and implementation of the
Company’s sustainability-related strategies, goals, initiatives, business plans and major
action plans;

(e) oversee the Group’s responsibilities, on-going commitments and initiatives on its
sustainability which encompasses the Economics, Environmental, Social and Governance
(“EESG”) to be in line with the Group’s vision, mission and values;

(f) review the relevant compliance with the regulatory and public commitments on
sustainability matters and monitor the effectiveness of the risk management framework
related to sustainability and EESG matters including risk appetites and risk policies;

(g) review and consider other sustainability and EESG related matters referred by the Board;

(h) ensure the EESG risks identified are incorporated into the risk register and the oversight of
each significant risk is the responsibility of the Board;

(i) consider and determine the Group’s position on relevant emerging sustainability issues, and
consider and recommend proposals, targets and commitments in connection thereto;

(j) oversee and assess the Group’s contribution to, impact on and role in environmental,
climate change and society in countries where it operates;

(k) facilitate the necessary sustainability reporting and disclosures as required by the relevant
regulatory and government authorities including the Annual Report of the Company; and

(l) perform any other duties relating to the sustainability as may be required or authorised by
the Board.

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xii. Authority

In executing and discharging its duties, the Committee has unlimited access to the Senior
Management of the Group for assistance, information and advice as well as the following: -

- to seek any information, as may be required from any employees within the Group and external
parties.
- To invite any employees or external parties to attend the Committee meeting as and when
required.
- To obtain, at the Company’s expense, outside legal or otherwise professional advice on any
matters within its terms of reference where the Committee deems necessary or as and when
required.

xiii. Review of the Terms of Reference

The GCRC shall review the Terms of Reference from time to time to ensure its relevance and to
consider any amendment/improvement(s) thereto as and when the GCRC deems necessary. Any
variation/amendment(s) to the Terms of Reference shall be recommended to the Board of Directors
for endorsement and adoption.

The Terms of Reference of the GCRC was last reviewed by the Board on 24 August 2023 and is available
on the Company’s website at www.wascoenergy.com.

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Corporate Governance Overview Statement

The Board of Directors (“the Board”) of Wasco Berhad (“WB” or “the Company”) recognises the importance
of practising and upholding good corporate governance in discharging its duties and responsibilities towards
enhancing business prosperity, corporate accountability, sustainability and realising and creating ongoing values
for its shareholders and stakeholders. Hence, the Board is pleased to present an overview of the extent of the
application and compliance of WB and its Group with the relevant principles and practices of the Malaysian
Code on Corporate Governance (“MCCG 2021”) issued by the Securities Commission Malaysia (“SC”) on 28
April 2021, the Guidelines on Conduct of Directors of Listed Corporations and Their Subsidiaries issued by SC
on 30 July 2020 and revised on 12 April 2021 (“SC Guidelines on Conduct of Directors”) as well as the Main
Market Listing Requirements (“MMLR”) of Bursa Malaysia Securities Berhad (“Bursa Malaysia”).

1. BOARD OF DIRECTORS

1.1 Duties and Responsibilities of the Board

The Board is responsible for the strategic planning, overseeing the proper utilisation and management
of its resources and operational conduct, financial and non-financial performance, identifying and
implementing appropriate systems to mitigate and manage principal risks, reviewing the adequacy
and integrity of its internal controls, risks management and management information systems
and ensuring that a management succession plan, a dedicated investor relation and shareholders’
communication policy are in place in meeting the Company’s goals and objectives.

The Board together with the Managing Director/Group Chief Executive Officer and the respective
Management team(s), where applicable, developed the Group’s corporate goals, objectives and
policies and set the appropriate limits of empowerment of its respective Management/Committees’
authority, duties and responsibilities.

The Board exercises due care and diligence in discharging its fiduciary duties and responsibilities
and in ensuring that high ethical standards are applied in practising and upholding good corporate
governance and through the compliance with the relevant rules and regulations, directives and
guidelines and the adoption of the relevant principles and practices of the MCCG 2021 and the SC
Guidelines on Conduct of Directors in addition to acting in the best interest of the shareholders,
stakeholders and the Group, taking into account diverse perspectives and insights.

The Board has established a Board Charter which sets out the Board’s strategic intent and outlines
the Board’s roles and responsibilities including the key values, mission, principles and ethos of the
Company. The Board Charter serves as a source of reference for Board members as well as a primary
induction literature for new Board members in respect of their duties and responsibilities and the
various legislations and regulations governing their conduct with the application of principles and
practices of good corporate governance in their business conduct. The Board Charter would be
reviewed and updated periodically as and when the need arises. The Board Charter is last reviewed
by the Board on 27 February 2024.

The Board Charter clearly spells out the following principal roles and responsibilities of the Board in
enhancing Board’s effectiveness in the pursuit of corporate goals and objectives:

• reviewing and adopting the strategic plans and direction of the Group;
• setting appropriate values and standards;
• reviewing the financial statements and forming a view on the information presented;
• overseeing the governance of sustainability and in setting the Group’s sustainability strategies,
priorities and targets which encompasses economics, environment, social and governance
aspects;
• overseeing and evaluating the conduct of the Group’s businesses;
• reviewing, challenging and deciding on Management’s proposals and recommendations and
monitor their implementation where appropriate;
• identifying principal risks and ensuring that appropriate internal control and risk management
and mitigation measures are implemented to manage these risks;
• succession planning including the implementation of appropriate systems for recruitment,
training, determining compensation benefits and replacement of Senior Management staff;
• developing and implementing an investor relations programme to enable effective
communications with the shareholders and stakeholders;

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 Corporate Governance Overview Statement

• supervising and assessing Management’s performance in managing the businesses of the WB

Group;
• reviewing the adequacy and integrity of the internal control systems, management information
systems and risk management framework which includes sound system of reporting and
in ensuring regulatory compliance with applicable laws, regulations, rules, directives and
guidelines;
• ensuring proper accounting and other records are kept to enable the preparation of true and fair
financial statements;
• ensuring an adequate group wide framework is in place to facilitate oversight and ensuring
integrity of the group financial and non-financial performance and reporting, business strategies
and priorities, risk management and corporate governance policies and practices of the Group;
and
• ensuring the group wide framework is established on corporate governance to include code
of conduct and ethics, policies and procedures on anti-corruption, whistleblowing, managing
conflict of interest, managing material sustainability risks and board diversity including gender
diversity.

The Board Charter is available on the Company’s website at www.wascoenergy.com.

Apart from the aforesaid principal roles and responsibilities of the Board, the Board also delegates
certain responsibilities to its Board Committees with clearly defined terms of reference to assist the
Board in discharging its responsibilities. While the Board Committees have their own functions and
delegated roles, duties and responsibilities, they will report to the Board with their decisions and/or
recommendations. Hence, the ultimate responsibility and decision on all matters lies with the Board.

As an effort to continuously observe high standard of ethical conducts, the Board has established the
Company Directors’ Code of Ethics on 27 November 2018 and it is last reviewed by the Board on 23
November 2022. The Company Directors’ Code of Ethics is available on the Company’s website at
www.wascoenergy.com.

The Directors are guided by the SC Guidelines on Conduct of Directors in the discharge of their
fiduciary duties towards the Company and the shareholders. The SC Guidelines on Conduct of
Directors covers the Conduct Requirements for Directors, Maintaining Proper Records and Accounts
and Group Governance in promoting corporate governance practices among the listed corporations in
Malaysia.

The Board of Directors has also established the Principles of Business Conduct as guidance for the
conduct of the Group’s business and on issues pertaining to conflict of interest and related parties
which may affect any members of the Board.

The Principles of Business Conduct is available on the Company’s website at www.wascoenergy.com.

The Board has devoted sufficient time in carrying out their duties and responsibilities. The schedule
of meetings for the calendar year comprising Board meetings and other Committee meetings is
prepared by the Group Company Secretary and sent to members of the Board at least four months
prior to the commencement of the calendar year to notify the Board on the meetings scheduled
ahead.

The Group Company Secretary besides overseeing the compliance matters and assisting the
Chairman in overseeing the governance matters of the WB Group, she also plays a pivotal advisory
role to the Board and its Committees to ensure that they function effectively. The Group Company
Secretary kept abreast with the latest amendments to the laws, acts, regulations, guidelines and
codes by attending various relevant talks, seminars, conferences and workshops.

The Board also takes their own initiatives and liberty to regularly update their knowledge and
enhance their skills by attending the relevant seminars and talks as listed under item 1.12 Directors’
Training.

The members of the Board have maintained the number of other directorships comfortable and
manageable by them in respect of time and commitment.

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Corporate Governance Overview Statement

1.2 Board Composition and Balance

During the year under review, the Board is led by the Non-Executive Chairman, Dato’ Seri Robert Tan
Chung Meng and altogether, the Board of WB comprises of nine (9) members, which includes one (1)
Executive Director, five (5) Non-Independent Non-Executive Directors (including the Non-Executive
Chairman) and three (3) Independent Non-Executive Directors.

The Board composition fulfilled the Bursa Malaysia’s MMLR to have at least one-third (1/3) of
Independent Directors and one (1) woman Director on Board.

The composition of the Board reveals their varied background as outlined on pages 94 to 98 of this
Annual Report. The Board members are equipped with the relevant skills, knowledge and expertise
required for the proper running of the Company’s affairs. The effectiveness of the individual Directors
and the Board as a whole are assessed annually by the Nomination and Remuneration Committee.

Generally, the Executive Director along with the Management Team are responsible for making
and implementing operational decisions. The Non-Executive Directors play a key supporting role,
contributing their skills, expertise and knowledge towards the formulation of the Group’s strategic and
corporate goals and objectives, policies and decisions. The Board collectively made decisions in the
best interest of the Company.

1.3 Board Independence

The number of Independent Directors on the Board complies with Paragraph 15.02, Chapter 15 of
the MMLR, which states that at least two (2) Directors or one-third (1/3) of the Board, whichever is
higher, shall comprise of Independent Directors and at least one (1) woman Director on the Board of
the Company. The existing Independent Directors fulfilled the criteria of independence as defined in
the MMLR as follows:

(i) they have fulfilled the criteria of independence as per the definition set out under Chapter 1 of
the MMLR;

(ii) they have the required skill sets, experience and expertise;

(iii) they understand the Company’s industry well and are able to contribute to the effective
oversight of the Company’s business activities while monitoring their independence;

(iv) they have performed their duties diligently and provided independent judgements and balanced
assessments hence ensured effective check and balance in the proceedings of the Board and
the respective Board Committees; and

(v) they have devoted sufficient time and attention to the duties and responsibilities as
Independent Non-Executive Directors of the Company.

All Independent Directors act independently of the Management and do not participate in any
business dealings and are not involved in any other relationship with the WB Group that may impair
their independent judgement and decision-making. Their presence provides a check and balance in
the discharge of the Board function and the Independent Directors’ views carry significant weight in
all Board deliberations and decision-making.

Annual assessment on the independence of the Independent Directors is conducted annually.

The Independent Directors of the Company have not exceeded the cumulative term limit of nine
(9) years in compliance with Practice 5.3 of the MCCG 2021 which requires the tenure of an
Independent Director to not exceed a cumulative term limit of nine (9) years.

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The Chairman of the Company and the Board is not an Independent Director. There are three (3)
Independent Directors out of nine (9) Board members. The Board has reviewed and will continue
to assess the Board composition and effectiveness on an annual basis. The Board believes
that its current Board composition provides the appropriate balance in terms of skills, knowledge
and experience in creating, protecting and enhancing the interests and values of all shareholders
and stakeholders and in overseeing the conduct of businesses and to properly run the WB Group
effectively. As the Chairman is also a shareholder who has substantial interest in the Company, he
is well placed to act on behalf of shareholders and stakeholders and in their best interest and in
providing Board leadership.

The Board believes in recognising and retaining high performance, talented and dedicated
Board members, Senior Management and workforce regardless of gender, ethnicity and age with
the required merits, knowledge, experience, expertise, competencies, professionalism, integrity
and ability in discharging their responsibility and capability in contributing to the Board and the
organisation. Hence, the Board has established a Diversity Policy which came into effect on 27
November 2018 and is last reviewed by the Board on 23 November 2022. The Diversity Policy is
available on the Company’s website at www.wascoenergy.com.

1.4 Division of Roles and Responsibilities between the Chairman and the Managing Director/Chief
Executive Officer

The Board is led by Dato’ Seri Robert Tan Chung Meng as the Non-Independent Non-Executive
Chairman and Mr Gian Carlo Maccagno as the Managing Director/Group Chief Executive Officer
(“CEO”).

There is a clear separation between the Chairman’s role and the Managing Director/Group CEO’s role
to ensure a division of responsibilities and a balance of control, power and authority.

The Chairman leads and manages the Board with a keen focus on governance and compliance. In
turn, the Board monitors the functions of the Board Committees in accordance with their respective
terms of reference to ensure its own effectiveness, while the Managing Director/Group CEO manages
the businesses and operations of the Group and implements and develops the Board’s decisions,
policies and strategies.

The Chairman of the Board does not serve on the Audit Committee, Nomination and Remuneration
Committee and Governance, Compliance and Risk Committee to ensure check and balance as well as
objective review by the Board.

1.5 Senior Independent Non-Executive Director

The Board has identified Tan Sri Saw Choo Boon as the Senior Independent Non-Executive Director
of the Board, to whom concerns relating to the Group may be conveyed by shareholders and other
stakeholders.

All concerns relating to the Group can be conveyed to him via his electronic mail address at
[email protected].

1.6 Board Meetings

The Board meetings for each financial year are scheduled before the end of the preceding financial
year, to enable the Directors to plan ahead and fit the year’s meetings into their own schedules. The
Board meets on a scheduled basis of at least four (4) times a year and has a formal schedule of
matters specifically reserved for the Board to decide in order to ensure that the direction and control
of the Company firmly rests in its hands, for example strategic financial and investment decisions.
Additional or ad hoc Board meetings can be convened as and when necessary.

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During the financial year ended 31 December 2023, the Board met four (4) times and the details of
the attendance of the Board members are as follows:

Total Meetings
Director Directorship Attended
Dato’ Seri Robert Tan Chung Meng Non-Independent Non-Executive Chairman 4/4
Gian Carlo Maccagno Managing Director/ 4/4
a
Group Chief Executive Officer
b
Chan Cheu Leong Non-Independent Non-Executive Director 4/4
c
Tan Sri Professor Lin See Yan Non-Independent Non-Executive Director 4/4
c
Halim Bin Haji Din Non-Independent Non-Executive Director 3/4
Tan Sri Saw Choo Boon Senior Independent Non-Executive Director d
4/4
Tan Jian Hong, Aaron Non-Independent Non-Executive Director 4/4
Datin Wan Daneena Liza Binti Independent Non-Executive Director 3/3
Wan Abdul Rahman
Lily Rozita Binti Mohamad Khairi Independent Non-Executive Director 3/3

a Succeeded the role of Managing Director/Group Chief Executive Officer with effect from 1 July
2023.
b Retired from the role of Managing Director/Group Chief Executive Officer and redesignated as
Non-Independent Non-Executive Director with effect from 1 July 2023.
c Redesignated as Non-Independent Non-Executive Director with effect from 23 May 2023.
d Appointed as Senior Independent Non-Executive Director with effect from 23 May 2023.

To facilitate productive and meaningful deliberations, the proceedings of the Board meetings
are conducted in accordance with a structured agenda with the supply of complete and timely
information to enable the Board to discharge their responsibilities effectively and for them to make
informed decisions. The Board reviews and deliberates on the Group’s financial performance and
results, business operations, budgets, reports of the various Board Committees, risks management,
business plans, corporate exercises and strategic financials and investments decisions.

In the intervals between Board meetings, any matters requiring urgent Board decisions and/or
approvals will be sought via circular resolutions which are supported with all the relevant information
and explanations required for an informed decision to be made.

1.7 Supply of Information

The Board is briefed in a timely manner on all major financial, operational and corporate matters. In
order to maintain confidentiality, meeting papers on issues or corporate proposals which are deemed
highly confidential and sensitive, would only be distributed to the Directors at the Board meeting
itself.

The Board stresses on having timely reports and has full access to quality information which is not
just historical or bottom line and financial oriented but information that goes beyond assessing the
quantitative performance of the Group and other performance factors e.g. customer satisfaction,
product and service quality, market share, market reaction, environmental protection, etc.

The Directors have access to all information within the Company whether as a full Board or in
their individual capacity, in furtherance of their duties. Through regular Board meetings, the Board
receives updates, written reports and supporting/discussion documents on the development and
business operations of the Group, as well as on potential corporate exercises, proposals, mergers and
acquisitions. Minutes of the respective Board Committees’ meetings are presented at Board meetings.
The respective Board Committees’ Chairman will brief the Board on major issues deliberated by each
of the Board Committees.

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The Board either collectively or individually is authorised to seek such independent professional
advice as may be considered necessary in furtherance of their duties at the expense of the
Company.

The Directors also have access to the advice and services of its qualified Group Company Secretary
in the course of discharging their duties and responsibilities and in fulfilling their obligation to
statutory requirements, the MMLR or other rules and regulations, either as a full Board or in their
individual capacity.

1.8 Group Company Secretary

Ms Irene Woo Ying Pun, the Group Company Secretary of the WB Group, is a Fellow Member of the
Malaysian Institute of Chartered Secretaries and Administrators (MAICSA) and also a former Council
Member from June 2016 to June 2022 of MAICSA. She is a qualified Chartered Secretary and a
Chartered Governance Professional. She heads the Group Corporate Secretarial Department of WB
and is a member of the key senior management team of the WB Group. She was appointed to the
position since 3 November 2008.

Ms Woo has more than 30 years of extensive relevant working experience in the corporate secretarial
practice both as the in-house Group Company Secretary for large public listed groups as well as in
large professional consultancy firms. She obtained her initial training of more than six years in Signet
& Co. Sdn. Bhd., the Corporate Secretarial arm of Messrs. Ernst & Young.

Ms Woo holds directorship in certain subsidiaries within the Wasco Berhad Group, however she does
not have any family relationship with any of the Directors or major shareholders of WB and has no
conflict of interest whatsoever with WB.

She ensures that the Group complies with the Companies Act, 2016, MMLR, Capital Markets &
Services Act, 2007 and all relevant acts, rules, regulations, codes and guidelines of the relevant
authorities and governmental/regulatory bodies and their relevant updates and amendments from
time to time. She assists the Board of Directors in overseeing and advising on the relevant aspects of
the regulatory, compliance and corporate governance matters of the Group. She attends all meetings
of the Board of Directors and all meetings of the Committees and Sub-Committees of the Board and
captures all discussions and deliberations thereat comprehensively and accurately in her minutes. Her
prompt and well written minutes and advices given to the members of the Board have so far assisted
the Board of Directors in making informed decisions as well as for the Management to promptly
act on decisions approved by the Board. The Board of Directors is satisfied with the competent
performance and support rendered by the Group Company Secretary in the discharge of their duties
and functions as members of the Board.

Ms Woo also assists in overseeing the Integrity function of WB. She chairs the Integrity Committee
meetings and assisted in the preparation of the Anti-Bribery and Corruption Policy and in the review
of the Anti-Bribery Management System Manual and its twenty-four (24) Standard Operating
Procedures (“SOP”).

1.9 Appointments to the Board

The Nomination and Remuneration Committee is responsible for assessing and making
recommendations on any new appointments to the Board and its various Board Committees.

In making these recommendations, due consideration is given to the composition, objective criteria,
required mix of skills, expertise, knowledge, experience, professionalism and integrity that the
proposed Directors shall bring to complement the Board. However, no person shall be appointed, re-
appointed, elected or re-elected as a Director on the Board or continue to serve as a Director if the
person is or becomes an active politician.

The Directors would notify the Chairman of the Board before accepting any new directorships and
the expected time to be spent on the new appointment.

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1.10 Re-election of Directors

The Company’s Constitution provides that all the Directors shall retire at least once (1) in every three
(3) years and are eligible for re-election at each Annual General Meeting in compliance with the
MMLR.

1.11 Board Committees

The Board delegates specific responsibilities to the respective Board Committees of the Board, each
of which has clearly defined terms of reference and its own functions, delegated roles, duties and
responsibilities. The Board reviews the functions and terms of reference of Board Committees from
time to time to ensure that they are relevant and updated in line with the MCCG 2021, the MMLR and
other related policies and/or regulatory requirements.

The Board Committees have the authority to examine specific issues and report to the Board on
outcome of their proceedings, deliberations, findings and recommendations. The Board also reviews
the minutes of the Board Committees’ meetings presented at Board meetings.

During Board meetings, the Chairman of the respective Committees provide summary reports of the
decisions and recommendations made at the respective Board Committees’ meetings, and highlight
to the Board on any further deliberation and/or approval that is required at the Board level. The Board
Committees shall deliberate and thereafter recommend their decisions to the Board for its approval.
The relevant decisions and recommendations of the Board Committees are incorporated into the
minutes of the Board meetings accordingly.

During the financial year under review, the Board has revamped the Board Committees in accordance
with their respective roles, functions and responsibilities. There are three (3) established principal
Board Committees namely, Audit Committee, Nomination and Remuneration Committee and the
Governance, Compliance and Risk Committee. While the sub-committees of the Board are the Risk
Management Committee, Integrity Committee and the Sustainability Steering Committee and these
committees report to the Governance, Compliance and Risk Committee and for certain matters that
fall under the purview of the Audit Committee, they will be tabled to the Audit Committee for review
and recommendation.

(a) Audit Committee

The composition of the Audit Committee (“AC”) comprises of Non-Executive Directors i.e. two
(2) Independent Non-Executive Directors and one (1) Non-Independent Non-Executive Director.
The Terms of Reference is last reviewed by the Board on 27 February 2024. The Terms of
Reference, including the duties and responsibilities of the AC are available on the Company’s
website at www.wascoenergy.com. This included AC’s new responsibility to review the actual,
potential and/or perceived conflict of interest declared by Directors and Key Senior Management
to determine the conflict of interest disclosed and the measure(s) required to be taken to
resolve, eliminate or mitigate the conflicts (if any) before the details of the conflict of interest
are reported to the Board.

A summary of activities of the AC in the discharge of its functions and duties for the financial
year ended 31 December 2023 are set out separately in the AC Report as laid out on pages
103 to 107 of this Annual Report.

(b) Nomination and Remuneration Committee

The Nomination and Remuneration Committee (“NRC”) is a merger of the Nomination Committee
and the Remuneration Committee and with the merging of both the committees, it enables a
holistic approach in the discussion and decision making.

The NRC comprised of three (3) Non-Executive Directors and a majority of whom are
Independent Directors. The activities of the NRC in the discharge of its duties for the financial
year ended 31 December 2023 are set out on pages 108 to 115 of this Annual Report.

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The NRC oversees the appointment of Directors and succession planning and development of
a diverse pipeline for Board and Management succession. The NRC also assess the Board’s
effectiveness and the contribution of each individual Directors independently in the discharge of
their duties and responsibilities by conducting annual assessment of the Board’s effectiveness
as a whole and the contribution of each individual Director using a set of customised self-
assessment questionnaires to be completed by the Directors. The results of the self-assessment
by Directors and the Board’s effectiveness as a whole are compiled by the Group Company
Secretary and will be tabled to the Board for review and deliberation.

The NRC also conducts the annual assessment on the Board Committees’ effectiveness based
on a set of questionnaires.

The NRC determines the remuneration packages of the Directors and Senior Management
to ensure that they are sufficient to attract and retain them to run the Company successfully
and to drive the Company’s long-term objectives. The remuneration packages will then be
recommended to the Board for discussion and approval. The individuals concerned will abstain
from discussion involving their own remuneration.

The information on the NRC and its Terms of Reference including its functions are available on
pages 108 to 115 of this Annual Report.

The Terms of Reference including the roles and responsibilities of the NRC are last
reviewed by the Board on 23 May 2023 and they are available on the Company’s website at
www.wascoenergy.com.

(c) Governance, Compliance and Risk Committee

The Governance, Compliance and Risk Committee (“GCRC”) is a newly established Committee of
the Board. The GCRC comprised of three (3) sub-committees namely:-

- Risk Management Committee

- Integrity Committee
- Sustainability Steering Committee

The GCRC assists the Board in fulfilling its corporate governance and oversight responsibilities
in relation to the relevant Acts, Laws, Requirements, Codes, Regulations and Policies governing
the Company. The GCRC oversees the development and implementation of the Group’s
sustainability-related framework, anti-bribery and corruption compliance, risk management and
their related policies.

The GCRC reports and updates the Board on matters and findings of the GCRC and makes the
necessary recommendations to the Board within its terms of reference or as authorised by the
Board.

The GCRC comprised exclusively of Non-Executive Directors and majority of whom are
independent. The Chairman of the GCRC is an Independent Director.

The Terms of Reference and duties and responsibilities of the GCRC are last reviewed
by the Board on 24 August 2023 and they are available on the Company’s website at
www.wascoenergy.com.

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Corporate Governance Overview Statement

i. Risk Management Committee

The Risk Management Committee (“RMC”) comprised of the Chief Financial Officer, Group
Internal Audit Head and Heads of Business Units/Divisions. The Committee meets at least
four (4) times a year to discuss, assess, manage and mitigate risks associated with the
respective Business Units and Divisions and the Group as a whole. The Summarised Risk
Registers compiled and confirmed by the respective Heads of the Business Units/Divisions
and based on which WB Group’s key risks are identified for monitoring. The threshold
limits of the value of the investment related proposals are established to determine the
relevant approvals required. As for new investments related proposals with value of the
investment of less than RM10.0 million or USD2.0 million equivalent will be reviewed by
the Chief Financial Officer and thereafter to be recommended for approval by the Group
CEO/Managing Director. While for new investments related proposals with value of the
investment more than RM10.0 million or more than USD2.0 million equivalent, both the
Group CEO/Managing Director and Chief Financial Officer will review and recommend the
proposed new investments or divestments to the AC and/or the GCRC where applicable for
their review and recommendation and thereafter the appropriate recommendation will be
tabled to the Board of WB for approval.

Potential new investments or divestments are tabled to the RMC for comprehensive risks
assessment review and deliberation on the risks associated with the proposed investment
before the said proposed investment is tabled to the AC and/or GCRC for review and
evaluation before tabling to the Board for approval.

The AC and/or the GCRC will consider and evaluate the feasibility of the investment
related proposals by taking into account the comprehensive feasibility study, due diligence
reports, valuation reports and/or other relevant reports in accordance with the standard
operating procedures. With the threshold limits of the value of the investment related
proposals being established to determine the relevant approvals required hence, the
Finance and Investment Committee has since been made redundant and abolished during
the year under review.

The RMC has been expanded to cover the areas of risks on sustainability of the WB Group.

The RMC reports to the GCRC on matters and updates pertaining to sustainability of the
Group on a quarterly basis.

The RMC has embedded bribery and corruption risk in the risk register and in the annual
risk assessment of WB Group.

ii. Integrity Committee

The Integrity Committee is established with members comprising Heads of various

Divisions selected by the Group Managing Director. The Integrity Committee oversees the
areas of anti-corruption and corporate liability for corruption and in ensuring that adequate
and appropriate policies and procedures on anti-corruption are in place and in ensuring the
Company’s approach to anti-bribery and anti-corruption is in compliance.

The Committee meets at least four (4) times a year to review the adequacy of anti-
bribery and anti-corruption compliance with Section 17A of the Malaysian Anti-Corruption
Commission Act 2009 (Amendment 2018) (“MACC Act”) by the Group and to deliberate
and manage any complaints and allegations of bribery and act of corruption reported
to the Committee. The proceedings of each meeting shall be minuted and a copy of the
minutes will be circulated to the Board for their attention.

The Chairman of the Committee shall update and report formally to the GCRC/Board and
make any necessary recommendations to the GCRC/Board during the quarterly GCRC/
Board meetings or as and when the need arises.

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The Committee has oversight of policy making, review and improvisation of the Anti-
Bribery Management System (“ABMS”) and its twenty-four (24) SOPs and practices for
compliance with the MACC Act.

iii. Sustainability Steering Committee

The Sustainability Steering Committee (“SSC”) is spearheaded by the Group CEO/Managing

Director and has been carrying out various initiatives on environment and climate change
activities and projects under the purview of the RMC. The SSC has been established and
formalized by the Board of Directors on 22 November 2022 and designated to support
and assist the Board in the oversight of the responsibilities towards the Group’s ongoing
commitments and initiatives on its sustainability which encompasses the economics,
environment, social and governance aspects to be in line with the Group’s vision, mission
and values.

The SSC plays an important role in developing the Company’s sustainability strategies,
plans, approach and integrating sustainability consideration in the day-to-day operations
of the Group and to drive, implement and monitor to ensure effective implementation of
the Company’s sustainability strategies, opportunities and plans.

The Committee meets at least four (4) times a year for the development, execution,
oversight, monitoring and assessing of the Group’s sustainability strategies, priorities,
goals, targets, performances, adequacies and related systems, framework, charter and
policies. The Chairman of the Committee shall report the necessary updates to the GCRC/
Board accordingly.

The Committee is responsible to ensure timely and efficient communication and reporting
of its sustainability reports, sustainability related statements and disclosures to the
relevant regulatory/government authorities, stakeholders and shareholders as well as
ensuring the quality, accuracy and completeness of the contents thereof.

1.12 Directors’ Training

All members of the Board have attended the Mandatory Accreditation Programme Part I as required
under the MMLR.

The Directors do and will undergo such similar or continuing training and education programmes from
time to time to equip and keep themselves abreast of the latest developments in order to discharge
their duties and responsibilities more effectively.

During the financial year under review, the Directors have participated in various programmes,
courses and forums which they have individually or collectively considered as relevant and useful in
contributing to the effective discharge of their duties as Directors.

The lists of trainings/courses attended by the respective Directors are tabled to the Board at the
respective Board meetings held every quarter for the Board’s notation. Based on the results of the
annual assessment of the individual Directors and the Board’s effectiveness as a whole conducted by
the NRC, the Board is satisfied with the trainings/courses attended by the respective Directors and
that they are well equipped and updated on the industry knowledge and developments in enhancing
their skills and in discharging their duties and responsibilities effectively.

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Corporate Governance Overview Statement

A brief description of the type of trainings/courses attended by the Directors for the financial year
under review is as set out below.

Date of Course/
Directors Name of Organiser Title of Training/Courses Attended
Dato’ Seri Robert 22 – 23 August 2023 Mandatory Accreditation Programme Part II:
Tan Chung Meng Institute of Corporate Directors Leading for Impact (LIP)
Malaysia
Tan Sri Professor 21 July 2023 ASEAN Workshop on Sustainable
Lin See Yan Sustainable Development Development – Exclusive Seminar by Jeffrey
Solutions Network Sachs to Senior Government Officials
Chan Cheu Leong 19 April 2023 Market Talks - The Balancing Act:
CGS-CIMB Navigating US Recession Risks Through a
Resilient Singapore Market
Gian Carlo 17 January 2023 UBS Year Ahead 2023 – A Year of
Maccagno UBS Bank (UBS) Inflections
Halim Bin Haji Din 19 September 2023 Advocacy Sessions for Directors and CEOs
Bursa Malaysia of Main Market Listed Issuers
Tan Jian Hong, 24 – 25 May 2023 Global Leadership Conference
Aaron Young Presidents’ Organisation
9 July 2023 AI Empowerment for CEOs
Young President Organisation
6 October 2023 Hyperinflation and AI with Fernando Lopez
Microsoft Iverasi
Tan Sri Saw Choo 9 February 2023 Malaysia Economic Monitor: “Expanding
Boon World Bank Malaysia’s Digital Frontier”
7 March 2023 Leading People Through Transformation
PricewaterhouseCoopers PLT
18 May 2023 National Economic Forum 2023
National Chamber of Commerce
and Industry of Malaysia
21 – 22 June 2023 Sustainable and Responsible Investment
Security Industry Development (SRI) Conference 2023
Corporation
30 June 2023 Chairperson Masterclass Series 2023 -
Climate Governance Malaysia Scaling Up the Circular Economy
6 July 2023 New Industrial Master Plan (NIMP) 2023
Ministry of International Trade & Open Day
Industry
5 September 2023 Conflict of Interest and Governance of
Bursa Malaysia Academy Conflict of Interest
13 September 2023 Business Foresight Forum (BFF) 2023 -
Security Industry Development Convergence of Transformative Innovation
Corporation with Revolutionary Impact
3 October 2023 Management of Cyber Risk by Ernst &
Bursa Malaysia Academy Young
6 – 7 November 2023 Mandatory Accreditation Programme Part II:
Institute of Corporate Directors Leading for Impact (LIP)
Malaysia

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Date of Course/
Directors Name of Organiser Title of Training/Courses Attended
Datin Wan 31 May – 2 June 2023 Mandatory Accreditation Programme Part I
Daneena Liza Institute of Corporate Directors
Binti Wan Malaysia
Abdul Rahman
28 June 2023 Induction Programme for New Directors
Wasco Berhad
21 August 2023 On-boarding Briefing Session for New
PLUS Malaysia Berhad Directors
23 August 2023 Director Onboarding
S P Setia Berhad
2 – 3 October 2023 Khazanah Megatrends Forum
Khazanah Nasional Berhad
6 October 2023 Engagement session on PNB ESG
Permodalan Nasional Berhad Commitments
(PNB)
11 October 2023 In-house Directors’ Training:
S P Setia Berhad Decarbonisation Workshop
17 November 2023 Setia Governance, Risk and Audit
S P Setia Berhad Forum 2023
27 November 2023 The Securities Commission Malaysia’s
Securities Commission Audit Oversight Board Conversation
with Audit Committees
15 December 2023 In-house Directors’ Training:
S P Setia Berhad/Asia School of Conflicts of Interest
Business
Lily Rozita Binti 31 May – 2 June 2023 Mandatory Accreditation Programme Part I
Mohamad Khairi Institute of Corporate Directors
Malaysia
28 June 2023 Induction Programme for New Directors
Wasco Berhad

2. DIRECTORS’ REMUNERATION

The remuneration of the Board Members is broadly categorised into those paid to Executive Directors and
Non-Executive Directors.

The Executive Directors are remunerated in cash and in kind by way of salary, performance bonus and
other benefits and entitlements; taking into consideration their experience, responsibilities, length of
service, their individual performance and contribution as well as the overall performance of the Group
and the Company. Non-Executive Directors are paid fees based on their experience and level of
responsibilities.

The Nomination and Remuneration Committee is responsible to make any recommendation to the Board
on the remuneration package and benefits extended to the Executive Directors; whereas, Non-Executive
Directors’ remuneration is a matter to be decided by the Board as a whole. The individual concerned must
abstain from deliberations and voting on decisions in respect of his individual remuneration.

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Corporate Governance Overview Statement

The details of the remuneration of the Directors of the Company (including the remuneration for services
rendered to the Company as a Group) received from the Company and received on a group basis during
the financial year ended 31 December 2023 are as follows:

Company

Benefits in-kind
Salaries and
Directors’ Other Leave
Fees Paid Emoluments Bonus Passage Others*
RM’000 RM’000 RM’000 RM’000 RM’000
Dato' Seri Robert Tan Chung Meng 100 10 - - 11
Halim Bin Haji Din 90 31 - - -
Tan Sri Saw Choo Boon 80 37 - - -
Tan Sri Professor Lin See Yan 80 35 - - -
Chan Cheu Leong 60 14,082 900 - 16
Gian Carlo Maccagno 60 6 - - -
Tan Jian Hong, Aaron 60 25 - - -
Lily Rozita Binti Mohamad Khairi - 11 - - -
Datin Wan Daneena Liza Binti Wan
Abdul Rahman - 13 - - -
530 14,250 900 - 27

Group

Benefits in-kind
Salaries and
Directors’ Other Leave
Fees Paid Emoluments Bonus Passage Others*
RM’000 RM’000 RM’000 RM’000 RM’000
Dato' Seri Robert Tan Chung Meng 100 10 - - 11
Halim Bin Haji Din 90 31 - - -
Tan Sri Saw Choo Boon 80 37 - - -
Tan Sri Professor Lin See Yan 80 35 - - -
Chan Cheu Leong 60 14,082 900 - 16
Gian Carlo Maccagno 60 4,764 1,328 241 21
Tan Jian Hong, Aaron 60 25 - - -
Lily Rozita Binti Mohamad Khairi - 11 - - -
Datin Wan Daneena Liza Binti Wan
Abdul Rahman - 13 - - -
530 19,008 2,228 241 48

* Others under benefits in-kind include motor vehicles, club subscription, etc.

In addition, the Group and the Company have made a provision of RM3,899,000 and RM Nil, respectively
for amounts payable to Executive Directors at the end of their employment for their services rendered to
the Group and the Company as part of their employment contract.

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3. TOP FIVE KEY SENIOR MANAGEMENT’S REMUNERATION

Pursuant to Practice 8.2 of the MCCG 2021, the top five Key Senior Management’s total remuneration
inclusive of salary, bonus, benefits-in-kind and other emoluments in bands of RM50,000 are disclosed as
follows:

Total
RM650,000 to RM700,000 1
RM850,000 to RM900,000 1
RM1,250,000 to RM1,300,000 1
RM1,550,000 to RM1,600,000 1
RM2,850,000 to RM2,900,000 1
Total 5

For purposes of security and to avoid poaching by other organisations, the names of the Top Five
Key Senior Management are withheld and the detailed remuneration of each of the individuals are not
presented because the Board of Directors is of the opinion that such information will not add significant
value and understanding towards the evaluation of the Company’s standard of Corporate Governance.

4. SHAREHOLDERS AND INVESTORS

4.1 Effective Communications Policy

Besides the various announcements and disclosures including information on the quarterly and
annual results released to Bursa Malaysia, the Board maintains an effective communication policy that
enables the Board (in particular the Executive Board Members) to communicate effectively with its
shareholders, stakeholders and the public in general.

As part of the Group’s commitment towards having an effective investor relations and shareholders’
communication policy, the following have been established:

a) an interactive and dedicated website for the Group which can be accessed by the public at
large at www.wascoenergy.com.

b) the Company’s Investor Relations and Communications Department attends to the Group’s
communication needs and whenever required, the services of an external public relations firm
will be engaged to promote the Group’s image and to create greater public awareness of the
Group’s products and services aside from fostering and maintaining closer relations with the
press and other members of the media.

c) Internally, the Group Corporate Secretarial Department headed by the Group Company
Secretary maintains most of the official correspondences with the various authorities.

d) the Annual General Meeting provides an additional forum for shareholders’ interaction and
feedback with the Company.

e) Media and Analyst Briefings are held by the Company to explain any major corporate exercises
and/or to discuss the financial performance of the Group from time to time.

Wasco Berhad 135

Corporate Governance Overview Statement

4.2 Dialogue between the Company and Investors

The Board values feedback and dialogues with its investors. The Company will hold open discussions
with investors upon written request. Analyst Briefings are periodically held to introduce and update the
investors on the Company’s/the Group’s undertakings and financial performance from time to time.

In this respect, the Board and the Company shall ensure that any information sought is disseminated
in strict adherence to the disclosure requirements under the MMLR.

The Company’s website at www.wascoenergy.com contains vital information concerning the Group.
All investors are encouraged at all times to log on and visit the Company’s website to be informed
of the latest happenings and detailed information of the Group and all the announcements made to
Bursa Malaysia.

4.3 Annual General Meeting

The Annual General Meeting (“AGM”) is one of the platforms for the Company’s shareholders to meet
and exchange views with the Board.

As part of the commitment to environmental sustainability and cost cutting initiative, the Company
has leveraged on technology to enhance efficiency. Since year 2018, the Company has been
uploading its Annual Report and Circular to Shareholders on its website at www.wascoenergy.com so
that they could be accessible online.

The Board also ensures that any general meetings of the Company are conducted either virtually or
hybrid in order to support meaningful engagements between the Board, Senior Management and the
shareholders.

An open Question and Answer Session will be held whereby any shareholder may seek further
details and clarification regarding any proposed resolutions as well as matters relating to the Group’s
businesses and affairs.

The Chairman and the other members of the Board together with the Management and the
Company’s External Auditors in attendance will provide explanations to all shareholders’ queries.

Pursuant to Paragraph 8.29A(1), Chapter 8 of the MMLR, any resolution set out in the notice of any
general meeting, or in any notice of resolution which may properly be moved and is intended to be
moved at any general meeting, is required to be voted by poll.

At least one (1) scrutineer will be appointed to validate the votes cast at the general meeting. Such
scrutineer must be independent of the person undertaking the polling process.

A summary of the key matters discussed at the AGM as well as the minutes of the AGM will be
published on the Company’s website as soon as practicable after the conclusion of the AGM.

5. ACCOUNTABILITY AND AUDIT

5.1 Financial Reporting

The Board aims to provide and present a balanced and meaningful assessment of the Group’s
financial position, performance and prospects at the end of the financial year primarily through the
audited financial statements, annual report as well as the quarterly announcements of results to
shareholders.

The Board is responsible for ensuring that the financial statements prepared are drawn up in accordance
with the provisions of the Companies Act, 2016 and applicable approved accounting standards in
Malaysia. In presenting the financial statements, the Company has used appropriate accounting policies,
consistently applied and supported by reasonable and prudent judgements and estimates. The Board
assisted by the AC, oversees the financial reporting processes and the quality of the financial reporting
by the Group. The AC scrutinises information prior to their disclosure to ensure their timeliness, accuracy
and adequacy. The quarterly financial results and audited financial statements are reviewed by the AC
and approved by the Board before being released to Bursa Malaysia.

The Statement of Directors’ Responsibility in respect of the audited financial statements of the
Company and the Group is set out on page 145 of this Annual Report.

136 Integrated Annual Report 2023

 Corporate Governance Overview Statement

5.2 Internal Control

The Board has overall responsibility for maintaining a sound system of internal control, which
encompasses risk management, financial, organisational, operational and compliance controls
necessary for the Group to achieve its objectives within an acceptable risk profile.

These controls can only provide reasonable but not absolute assurance against material
misstatement, errors of judgment, loss or fraud.

Information on the Group’s Internal Control is as set out in the Statement on Risk Management and
Internal Control on pages 142 to 144 of this Annual Report.

The establishment of an Internal Audit Department since the Group first commenced operations
followed by the formation of the RMC in 2009 are testimony of the dedication and commitment that
the Board and the Company have in identifying and mitigating potential risks which affect the Group.

5.3 Whistle Blowing Policy

The Company has disseminated its Whistle Blowing Policy by which an employee or stakeholder can
report or disclose in good faith, through the established channel, genuine concerns about unethical
behaviour, malpractice, illegal act or failure to comply with regulatory requirements.

The Board of Directors will ensure that the Whistle Blowing Policy is reviewed periodically, at least
once every 3 years, to assess its effectiveness and to ensure its relevance. The Whistle Blowing
Policy is last reviewed by the Board on 23 May 2023.

The procedures of the Whistle Blowing Policy, in raising such genuine concerns to the established
channels are available on the Company’s website at www.wascoenergy.com.

5.4 Conflict of Interest Policy

The Conflict of Interest Policy is established and approved by the Board of Directors on 27 February
2024 in line with the Bursa Malaysia focus on enhancing the MMLR to address issues associated
with conflict of interest involving Directors and key senior management of the Company and its
subsidiaries.

The purpose of the policy is to ensure that actual, potential and perceived conflicts of interest are
identified and managed effectively as it provides guidance on how to deal with conflict of interest
situations as they arise and protect the Group’s interest, while assisting the Directors and employees
to perform with high integrity and ethical standards.

The policy applies to all Directors and employees of the WB Group (including employees on contract
terms, temporary staff and those on internship). The policy applies when an individual recognises,
or should reasonably recognise, that a conflict of interest may arise from their current or future
activities. The policy guides the individual on how to identify and declare all conflict of interest, how
to develop, implement and monitor actions to appropriately manage the conflict, and how to deal with
breaches of the policy. The scope of the policy is relatively wide in coverage of the activities that
may give rise to conflicts of interest.

The Conflict of Interest Policy is available on the Company’s website at www.wascoenergy.com.

5.5 Principles of Business Conduct

The Board is committed to achieving and maintaining high ethical standards with regards to behavior at
work and hence the Principles of Business Conduct is established. The Principles of Business Conduct
of the Group is a formal document which sets out the guiding principles and standards in which the
employees and Directors shall adhere to in conducting the day-to-day duties and operations.

The Principles of Business Conduct is available on the Company’s website at www.wascoenergy.com.

Wasco Berhad 137

Corporate Governance Overview Statement

5.6 Relationship with Auditors

The Board has established a formal and transparent relationship with the External Auditors appointed
by the Company and its subsidiaries within its fold.

The External Auditors are invited to attend the AC Meeting where the Group’s annual financial results
are considered, as well as at meetings to review and discuss the Group’s audit findings, internal
controls and accounting policies, whenever the need arises.

For the financial year under review, the AC had two (2) meetings with the External Auditors without
the presence of Management, which has encouraged a greater exchange of independent, frank views
and opinions/dialogue between both parties.

The AC obtains written confirmation from the External Auditors on their independence throughout
their terms of engagement for the financial year in compliance with the requirements of the relevant
professional and regulatory bodies and/or authorities.

The Board also reviews the External Auditors’ annual audit plan and scope of work for each of the
financial years and the External Auditors’ audit review on the financial statements for each of the
financial years together with their audit report.

The Annual Assessment Form for External Auditors is established to assess the annual performance
of the External Auditors by the AC. During the financial year under review, the AC had reviewed the
independence of the External Auditors by taking into consideration among other factors, the following:-

• rotation of the External Audit Partner-in-charge once in every five years in accordance with the
relevant laws and requirements; and

• the professionalism, openness in communication and interaction with the External Auditors
through private discussions which had demonstrated their independence.

The AC also assessed the suitability, objectivity and independence of the External Auditors by taking
into consideration among other factors, the following:-

• size, sufficiency of the allocated resources and geographical coverage of the external audits
being conducted;

• calibre, competency, requisite skills and expertise, including industry knowledge of the audit
team to effectively audit the Company and the Group that meet the requirements;

• adequacy of audit scope and plan to address the accounting risks, audit risk and financial
reporting risks faced by the Company and the Group;

• quality and effectiveness of the audit services provided by the External Auditors;

• the External Auditors met their performance targets as expected of them; and

• the information presented in the External Auditors’ Annual Transparency Report.

Based on the results of the Annual Assessment of External Auditors carried out during the financial
year under review, the AC was satisfied with the independence and suitability of the External
Auditors and hence had recommended the re-appointment of the External Auditors for the Board’s
consideration.

The Board, upon the recommendation of the AC, concurred on the suitability and independence of
the External Auditors and had therefore agreed to table the resolution for the re-appointment of the
External Auditors to the Shareholders at the forthcoming Twenty-Fourth AGM for their approval.

Further information on the role of the AC with the External Auditors is stated in the AC Report on
pages 103 to 107 of this Annual Report.

138 Integrated Annual Report 2023

 Corporate Governance Overview Statement

5.7 Internal Audit Function

The internal audit function is performed by the Group Internal Audit (“GIA”), where their primary
responsibility is to provide independent and objective assurance in assisting the Group to
accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the
effectiveness of risk management, control and governance. The Head of GIA has functional reporting
to the AC and administratively reports to the Managing Director/Group Chief Executive Officer. All
the internal audit activities and processes are performed as guided by the approved Internal Audit
Charter and the GIA Standard Operating Procedure. The GIA is in conformance with the International
Standards for the Professional Practice of Internal Auditing.

The Board ensures that the Group has an effective governance, risk management and internal control
framework.

For more information pertaining to the internal audit activities, please refer to the AC Report on pages
103 to 107 of this Annual Report.

6. CORPORATE RESPONSIBILITY

Throughout 2023, the Group has undertaken various initiatives to create a positive and momentous impact
on the lives of others, within the community and the environment in which it operates, as set out in the
Sustainability Statement on pages 46 to 91 of this Annual Report.

7. SUSTAINABILITY

The Company has come a long way from a medium sized Malaysian enterprise to where the Group is
today. It is through resilience and fortitude that the Group has been growing from strength to strength,
meeting challenges along the way and succeeding in branching further aloft. As at today, the Group is a
significant player in its core businesses and is sustaining growth on the global business landscape.

The Company develops, implements and maintains sound management systems for sustainable
development and growth that drive continual improvement. While maintaining sustainable growth, the
Company is committed to create an open, diverse, friendly and safe workplace which is part of the Group’s
core values. Besides, the Company places utmost priority and is fully committed to its Health, Safety
and Environment policy and objectives with the aim of ensuring health and safety of our people as well
as protection of the environment that the Group operates in by promoting and improving the health and
welfare of the workforce, maintaining an accident-free work environment, eliminating occupational injuries,
preventing pollutions by reducing carbon footprint, preventing wastages by promoting the efficient use of
resources, recycling initiatives, optimising the use of natural resources and conserving energy.

The Group is dedicated in supporting the local communities within which it operates and through its
corporate responsibility programmes, the Company will continue to implement initiatives to contribute back
to the society and local communities.

A separate Report on Sustainability is as set out on pages 46 to 91.

8. CORPORATE DISCLOSURE POLICIES AND PROCEDURES

The Board has established a Corporate Disclosure Policies and Procedures aiming at effectively handling
and disseminating the corporate information timely and accurately to its shareholders, stakeholders,
potential investors and the public in general as required by Bursa Malaysia.

The Corporate Disclosure Policies and Procedures are available on the Company’s website at
www.wascoenergy.com.

Wasco Berhad 139

Corporate Governance Overview Statement

9. GOVERNANCE MODEL DOCUMENT

The Governance Model Document is established and approved by the Board of Directors on 23 February
2021 as part of the Group wide framework for co-operation and communication between the Company
and its subsidiaries, in compliance with the Group Governance under Chapter 5 of the SC Guidelines on
Conduct of Directors.

The Governance Model Document is last reviewed by the Board on 23 May 2023. The Governance Model
Document is available on the Company’s website at www.wascoenergy.com.

10. ANTI-CORRUPTION MEASURES

The Company published the Anti-Bribery and Corruption Policy (“ABC Policy”) on the Company’s website in
compliance with the MMLR which took effect from 1 June 2020. The Group’s Anti-Bribery and Corruption
Management System Manual (“ABMS Manual”) and its twenty four (24) Standard Operating Procedures
(“SOPs”) were established on 1 December 2020 in accordance with SIRIM ISO 37001: 20l6 and Section
17A of the MACC 2009 (Amendment 2018). The ABMS Manual together with its 24 SOPs serves as a
comprehensive preventive tool and guidance to the Directors, employees and business associates of the
Company and the Group in recognizing the Group’s core values, principles and expectations, as well as the
policies and procedures in preventing, detecting and handling of potential bribery and corruption matters.

The Board of Directors is committed to ensuring that the policies and procedures on anti-corruption and
bribery are reviewed periodically, at least once every 3 years to assess their effectiveness in addressing
and mitigating corruption risks.

The Board of Directors is assisted by the GCRC and its sub-committee, the Integrity Committee in the
oversight of policy-making, implementation of an effective regulatory framework and practices and to
ensure that the approach of the Group on anti-bribery and anti-corruption is in compliance with the SIRIM
ISO 37001:2016 and Section 17A of the MACC Act (Amendment 2018) while the Risk Manager captures
such risks in the risk register and in the annual risk assessment of the WB Group for the review by the
Risk Management Committee. The Internal Auditors have embedded bribery risks and anti-bribery and
corruption in their scope of audit.

11. CORPORATE GOVERNANCE REPORT

Please refer to the Company’s Corporate Governance Report on the extent of the Company and its Group’s
application and compliance with the MCCG 2021 and the relevant explanations for the deviations which
can be downloaded from the Company’s website at www.wascoenergy.com.

140 Integrated Annual Report 2023

 Additional Compliance Information

1. UTILISATION OF PROCEEDS RAISED FROM CORPORATE PROPOSALS

There are no proceeds raised from corporate proposals during the financial year ended 31 December
2023.

2. RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE AND PROVISION

OF FINANCIAL ASSISTANCE

The details of significant recurrent related party transactions conducted during the financial year ended
31 December 2023 pursuant to the shareholders’ mandate are disclosed in the Summary of Significant
Recurrent Related Party Transactions as set out on pages 287 to 288 of this Annual Report.

3. MATERIAL CONTRACTS

There are no material contracts (not being contracts entered into in the ordinary course of business),
entered into by the Company and its subsidiaries, involving the interests of the Directors, Chief Executive
who is not a Director or major shareholders during the financial year ended 31 December 2023.

4. AUDIT AND NON-AUDIT FEES

(a) The amount of audit fees paid and payable to the Company’s External Auditors i.e.
PricewaterhouseCoopers PLT Malaysia (“PwC”) for the services rendered to the Company and the
Group for the financial year under review are RM93,000 and RM985,000 respectively. While the
amount of audit fees paid and payable to PwC’s affiliates for services rendered to the Group for the
financial year under review are RM922,000.

(b) The amount of non-audit fees paid and payable to PwC and its affiliates for the services rendered
to the Company and the Group for the financial year under review are RM13,000 and RM1,652,000
respectively.

(c) The summary of the aforesaid audit and non-audit fees for the services rendered to the Company
and the Group paid and payable to PwC and its affiliates for the financial year under review are as
follows:-

Company Group
(RM) (RM)
Audit Fees 93,000 1,907,000
Non-Audit Fees* 13,000 1,652,000
Total 106,000 3,559,000

* Included in fees for non-audit services are fees payable to PwC for the Company and the Group
of RM13,000 and RM362,000 respectively.

* The non-audit fees incurred for the Company and the Group during the financial year under
review amounted to RM1,652,000, constituting approximately 46% of the total amount of audit
and non-audit fees of RM3,559,000 paid and payable to PwC and its affiliates for the services
rendered to the Company and the Group. The non-audit services are mainly related to statutory
tax compliance/advisory and project advisory.

Wasco Berhad 141

Statement on Risk Management and
Internal Control
BOARD RESPONSIBILITY

The Board of Directors (“Board”) recognises the importance of sound risk management and internal control
practices for good corporate governance. The Board affirms its responsibility for ensuring the Group’s system is
able to adequately and effectively manage significant risks.

The Group has in place an ongoing process for identifying, evaluating and managing significant risks through
a framework, which includes a reporting structure. This is supported through a Risk Management Committee
(“RMC”) that meets quarterly, receiving risk management updates and taking necessary actions to ensure that
risks are managed within the acceptance levels of the company within which they reside.

The Group’s system of internal control is designed to manage and mitigate risks appropriately, rather than
eliminate the risk of failure to achieve business objective. Due to the inherent limitations in all control systems,
these control systems can only provide reasonable and not absolute assurance.

The Board has received reports from the RMC via the Governance, Compliance and Risk Committee (“GCRC”)
that the Group’s risk management and internal control system is operating adequately and effectively in all
material aspects based on the existing risk management and internal control system of the Group in financial
year 2023 (“FY 2023”).

Based on the reports received from the RMC via GCRC and the reports from various sources (including both
internal and external auditors), the Board is of the view that the system of risk management and internal control
are in place for FY 2023 and up to the date of approval of this statement is adequate and effective to safeguard
shareholders’ interest in the Group, interest of customers, regulators, employees and the Group’s assets.

In addition, the Board also received assurances from the Group Chief Executive Officer and Group Chief
Financial Officer that the Group’s risk management and internal control system are operating adequately and
effectively in all material aspects, based on the risk management model adopted by the Group.

RISK MANAGEMENT COMMITTEE

The RMC being the sub-committee of the GCRC was established by the Board towards ensuring a sound
system of risk management framework is embedded into the culture, processes and structures of the Group.
The RMC provides oversight on the effectiveness of the Group’s policies and processes in identifying, evaluating
and managing the Group’s risks.

The RMC is chaired by the Group Chief Financial Officer and made up of the Senior Management Team of the
Group’s significant business segments.

The principal responsibilities of the RMC include:-

• Reviewing the Group Risk Management Framework, as and when necessary, for approval by the GCRC and
the Board;
• Ensuring that the processes to identify, assess, treat, monitor and report on all material business risks are
functioning as designed;
• Maintaining and reviewing both the Group’s top risks and segmental / business unit risk profiles with the
assistance from the Group Risk Management every quarter;
• Providing guidance and direction to the Business Units on the adequacy and effectiveness of internal
control system for the identification and mitigation of material business risks; and
• Undertaking any other risk management tasks as may be delegated to the committee by the board.

KEY ELEMENTS AND PROCESSES ON RISK MANAGEMENT AND INTERNAL CONTROLS

The key elements and processes that have been established in reviewing the adequacy and effectiveness of the
risk management and internal control system include the following:-

142 Integrated Annual Report 2023

 Statement on Risk Management and
Internal Control
RISK MANAGEMENT

The Group Risk Management Framework, which is embedded in the management system of the Group, clearly
defines the authority and accountability in implementing the risk management process and internal control
system. The Management assisted the Board in implementing the process of identifying, evaluating and
managing significant risks applicable to their respective areas of business and in formulating suitable internal
controls to mitigate and control these risks.

The Group has adopted Risk Management Guidelines which is based on ISO 31000, the international guideline
for managing risk, to ensure that risk management process is consistent across the Group. Risk owners across
the business divisions of the Group defined, highlighted, reported and managed various risks, including
business and operational risks anticipated by them.

All business segments or major departments across the Group had conducted risk assessments to identify the
risks relating to their areas of supervision, analyzed the likelihood of these risks occurring, the impact if they do
occur, evaluated the risk level, as well as determined the existing controls and actions to be taken to manage
these risks to an acceptable level. The risk profiles measures determined from this process were documented in
risk registers with each business or operations area having its respective risk register. The overall process was
facilitated by the Group Risk Management, which is dedicated to this role.

The risk assessment report was tabled to the RMC every quarter. During the quarterly meeting, the significant
risks of business units were presented to the RMC for their deliberation. The RMC reports to the GCRC on any
significant changes in the business and external environment, which affect key risks.

The Board has approved via the RMC, the Risk Management Framework, which highlighted the governance
arrangements as well as assigned responsibilities to the relevant levels of management and operations. The
implementation of the Framework is ultimately the responsibility of the Wasco Berhad Group Management.
Evidence of implementation can be seen in the appropriate risk management practices integrated into the
relevant business processes, which facilitated the decision making aimed at achieving the Group’s objectives.

INTERNAL AUDIT FUNCTION

The internal audit engagements are performed by the Group Internal Audit (“GIA”), where their primary
responsibility is to provide independent and objective assurance in assisting the Group to accomplish its
objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk
management, control and governance. The Head of GIA reports functionally to the AC and administratively
reports to the Managing Director/ Group Chief Executive Officer.

The audit engagements were carried out based on the approved annual Internal Audit Plan. In FY 2023, the
GIA had completed 8 risk-based audits and special reviews which were presented to the AC. They focused
on review of various scopes including project management, anti-bribery, industrial trading, heavy machinery
distributors, special review and other business processes of the Group. High impact audit findings with regards
to risk, control and governance with recommendation for further improvement were escalated to the attention
and scrutiny of the senior management and subsequently tabled to the AC every quarter. Follow up review on
audit engagements was also conducted quarterly to ensure proper and effective remedial actions have been
taken by the line management to close control gaps highlighted by the GIA. All the internal audit activities and
processes performed in FY 2023 were guided by the Internal Audit Charter and the GIA Standard Operating
Procedure. The GIA is in conformance with the International Standards for the Professional Practice of Internal
Auditing.

OTHER KEY ELEMENT ON INTERNAL CONTROL SYSTEM

Internal control processes, which are embedded for effective Group’s operations include:-

• Clear organisational structure and financial authorisation limits are clearly defined;
• Group policies, including Principles of Business Conduct and Whistle Blowing Policy and Standard
Operating Procedures to ensure compliance with internal controls, relevant laws and regulations;
• Annual business plans of all Business Units are reviewed and approved by the respective divisional
management committee;
• Group budgets are reviewed and approved by the Board;

Wasco Berhad 143

Statement on Risk Management and
Internal Control
• Regular divisional management committee meetings at Business Units are held to review the operational
and key performance indicators against the approved budget;
• Utilisation of contract tendering and evaluation process for large projects; and
• Weekly report on Group’s cash position is monitored by Group Treasury.

Periodic site visits to operating units are undertaken by the members of the divisional management committee
and/or the members of the Board whenever deemed appropriate.

The Group’s system of risk management and internal control applies principally to Wasco Berhad (formerly
known as Wah Seong Corporation Berhad) and its subsidiaries. Associate companies and joint ventures have
been excluded because the Group does not have full management control and/or majority Board representation.

This statement is duly approved by the Board via a directors’ circular resolution dated 16 April 2024.

RISK MANAGEMENT FRAMEWORK

The RMC principally develops, executes and maintains the risk management system to ensure that the Group’s
corporate objectives and strategies are achieved within the acceptable risk appetite of the Group. Its reviews
cover responses to significant risks identified including non-compliance with applicable laws, rules, regulations
and guidelines, changes to internal controls and management information systems, and output from monitoring
processes as well as continual review process of identified risks and effectiveness of mitigation strategies and
controls.

Risk Management Process

Step 1 Establish the context

� Key objective for risk management
� Risk Appetite
Communication and Consultation

Step 2 Risk Identification

� Identify the risks
� Risk Categories Review and Monitoring

Step 3 Risk Assessment

� Gross Risk Assessment � Identify likelihood, Impact and
� Net Risk Assessment Risk Matrix

Step 4 Risk Evaluation

� Evaluate risk
� Determine acceptability

Step 5 Risk Treatment

� Accept � Transfer
� Avoid � Reduce (likelihood and/or Impact)

REVIEW OF THIS STATEMENT

As required by Paragraph 15.23, Chapter 15 of the Main Market Listing Requirements of Bursa Malaysia
Securities Berhad, the external auditors have reviewed this Statement on Risk Management and Internal
Control. Their limited assurance review was performed in accordance with Audit and Assurance Practice Guides
(“AAPG”) 3 issued by the Malaysian Institute of Accountants. AAPG 3 does not require the external auditors to
form an opinion on the adequacy and effectiveness of the risk management and internal control systems of the
Group.

144 Integrated Annual Report 2023

Statement of Directors’ Responsibility

The Directors are responsible for ensuring that the annual audited financial statements of the Group and the
Company are drawn up in accordance with the Malaysian Financial Reporting Standards, International Financial
Reporting Standards, the requirements of the Malaysian Companies Act, 2016 and the Main Market Listing
Requirements of Bursa Malaysia Securities Berhad.

The Directors are also responsible for ensuring that the annual audited financial statements of the Group
and the Company are prepared with reasonable accuracy from the accounting records of the Group and the
Company so as to give a true and fair view of the state of affairs of the Group and the Company as at 31
December 2023, and of the results of their operations and cash flows for the financial year ended on that date.

In preparing the annual audited financial statements, the Directors have applied the appropriate and relevant
accounting policies on a consistent basis; made judgements and estimates that are reasonable and prudent;
and prepared the annual audited financial statements on a going concern basis.

The Directors are also responsible for taking reasonable steps to safeguard the assets of the Group and the
Company to prevent and detect fraud and other irregularities.

Wasco Berhad 145

06
146 Integrated Annual Report 2023
Financial Statements
and Other
Information
Directors’ Report
Statement by Directors
Statutory Declaration
Indenpendent Auditors’ Report
Statements of Financial Position
Statements of Profit or Loss
Statements of Other Comprehensive Income
Consolidated Statement of Changes in Equity
Company Statement of Changes in Equity
Statements of Cash Flows
Notes to the Financial Statements
Summary of Significant Recurrent Related Party Transactions
Top 10 List of Properties
Analysis of Shareholdings
Notice of Twenty-Fourth Annual General Meeting
Statement Accompanying Notice of
Twenty-Fourth Annual General Meeting

Wasco Berhad 147

Directors’ Report

The Directors hereby submit their report and the audited financial statements of the Group and of the Company
for the financial year ended 31 December 2023.

CHANGE OF NAME

The Company changed its name from Wah Seong Corporation Berhad to Wasco Berhad with effect from 31 May
2023, following the conclusion of the Annual General Meeting held on 30 May 2023 and Notice of Registration
of the new name issued by the Companies Commission of Malaysia on 1 June 2023, pursuant to Section 28 of
the Companies Act 2016.

PRINCIPAL ACTIVITIES

The principal activities of the Company are investment holding and provision of management services to its
subsidiaries.

The principal activities of the Group consist of specialised pipe coating and corrosion protection services;
Engineering, Procurement and Construction (“EPC”) of gas compressors and process equipment and provision
of bioenergy services. See Notes 9 and 43 to the financial statements for further details.

There have been no significant changes in the nature of these activities during the financial year.

FINANCIAL RESULTS

Group Company
RM’000 RM’000

Net profit for the financial year attributable to:

- Owners of the Company 108,402 12,490
- Non-controlling interests 46,426 -

Net profit for the financial year 154,828 12,490

DIVIDENDS

No dividends have been paid or declared by the Company since the end of the previous financial year.

The Directors do not recommend the payment of any dividend in respect of the financial year ended 31
December 2023.

RESERVES AND PROVISIONS

There have been no material transfers to or from reserves and provisions during the financial year.

ISSUE OF SHARES AND DEBENTURES

The Company did not issue any shares and debentures during the financial year.

148 Integrated Annual Report 2023

 Directors’ Report

TREASURY SHARES

During the financial year, the Company did not purchase any of its issued share capital from the open market on
Bursa Malaysia Securities Berhad (“Bursa Malaysia”).

As at 31 December 2023, the total number of treasury shares held by the Company was 577,054 shares.

Details of the treasury shares are set out in Note 24 to the financial statements.

DIRECTORS

The Directors in office during the financial year and during the period from the end of the financial year to the
date of this report are:

Dato’ Seri Robert Tan Chung Meng

Chan Cheu Leong
Gian Carlo Maccagno
Halim Bin Haji Din
Tan Sri Professor Lin See Yan
Tan Jian Hong, Aaron
Tan Sri Saw Choo Boon
Datin Wan Daneena Liza Binti Wan Abdul Rahman
Lily Rozita Binti Mohamad Khairi

The names of Directors of subsidiaries are set out in the respective subsidiaries’ statutory accounts and the said
information is deemed incorporated herein by such reference and made part thereof.

DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES

According to the Register of Directors’ Shareholdings required to be kept under Section 59 of the Companies
Act, 2016, none of the Directors who held office at the end of the financial year held any shares or debentures
in the Company or its subsidiaries during the financial year except as follows:

Number of ordinary shares

As at As at
1.1.2023 Acquired Disposed 31.12.2023

The Company

Dato’ Seri Robert Tan Chung Meng

- direct interest 11,927,314 - - 11,927,314
- deemed interest #
312,063,822 22,931,490 (16,000,000) 318,995,312

Chan Cheu Leong

- direct interest 20,677,936 - - 20,677,936
- deemed interest* 44,031,991 - - 44,031,991

Gian Carlo Maccagno

- direct interest 2,759,853 1,349,202 - 4,109,055

By virtue of his interests of more than 20% in the shares of the Company, Dato’ Seri Robert Tan Chung Meng is
deemed to be interested in the shares of all the subsidiaries to the extent that the Company has an interest.

# Deemed interest held through Wah Seong Enterprises Sdn. Bhd., Karya Insaf (M) Sdn. Bhd., Wah Seong
(Malaya) Trading Co. Sdn. Bhd. and Tan Kim Yeow Sendirian Berhad pursuant to Section 8 of the
Companies Act, 2016 (“the Act”).
* Deemed interest held through Midvest Asia Sdn. Bhd. and Midvest Properties Sdn. Bhd. pursuant to
Section 8 of the Act and includes interests of his spouse and children.

Wasco Berhad 149

Directors’ Report

DIRECTORS’ BENEFITS

Since the end of the previous financial year, no Director has received or become entitled to receive a benefit
(other than the benefits shown under Directors’ Remuneration in Note 41 and related party transactions in Note
39) by reason of a contract made by the Company or by a related corporation with the Director or with a firm of
which the Director is a member, or with a company in which the Director has a substantial financial interest.

Neither during nor at the end of the financial year was the Company or any of its subsidiaries a party to any
arrangements whose object was to enable the Directors to acquire benefits by means of the acquisition of
shares in, or debentures of, the Company or any other body corporate.

DIRECTORS’ REMUNERATION

Total directors’ remuneration incurred by the Group and the Company for the financial year ended 31 December
2023 is RM6,793,000 and RM708,000 respectively as set out in Note 41 to the financial statements.

INDEMNITY GIVEN TO DIRECTORS AND OFFICERS

During the financial year, the total amount of indemnity coverage and insurance premium paid for the Directors
and officer of the Group and the Company was RM200,699.

OTHER STATUTORY INFORMATION

(a) Before the financial statements of the Group and of the Company were prepared, the Directors took
reasonable steps:

(i) to ascertain that proper action had been taken in relation to the writing off of bad debts and the
making of provision for doubtful debts and satisfied themselves that all known bad debts had been
written off and that adequate provision had been made for doubtful debts; and

(ii) to ensure that any current assets, which were unlikely to be realised in the ordinary course of
business including the values of current assets as shown in the accounting records of the Group and
of the Company had been written down to an amount which the current assets might be expected so
to realise.

(b) At the date of this report, the Directors are not aware of any circumstances:

(i) which would render the amounts written off for bad debts or the amount of the provision for doubtful
debts inadequate to any substantial extent; or

(ii) which would render the values attributed to current assets in the financial statements of the Group
and of the Company misleading; or

(iii) which have arisen which would render adherence to the existing method of valuation of assets or
liabilities of the Group and of the Company misleading or inappropriate.

(c) At the date of this report:

(i) there are no charges on the assets of the Group and of the Company which have arisen since the
end of the financial year which secures the liabilities of any other person; and

(ii) there are no contingent liabilities in the Group and in the Company which have arisen since the end of
the financial year.

(d) No contingent or other liability of any company in the Group has become enforceable or is likely to become
enforceable within the period of twelve months after the end of the financial year which, in the opinion of
the Directors, will or may affect the ability of the Company and its subsidiaries to meet their obligations
when they fall due.

150 Integrated Annual Report 2023

 Directors’ Report

OTHER STATUTORY INFORMATION (CONTINUED)

(e) At the date of this report, the Directors are not aware of any circumstances not otherwise dealt with in
this report or the financial statements of the Group and of the Company which would render any amount
stated in the respective financial statements misleading.

(f) In the opinion of the Directors:

(i) the results of the operations of the Group and of the Company during the financial year were not
substantially affected by any item, transaction or event of a material and unusual nature; and

(ii) there has not arisen in the interval between the end of the financial year and the date of this report
any item, transaction or event of a material and unusual nature likely to affect substantially the results
of the operations of the Group and of the Company for the financial year in which this report is made.

AUDITORS’ REMUNERATION

Auditors’ remuneration for the statutory audit of the Group and the Company totalled for the financial year
ended 31 December 2023 is RM2,857,000 and RM93,000 and is set out in Note 31 to the financial statements.

AUDITORS

The auditors, PricewaterhouseCoopers PLT (LLP0014401-LCA & AF 1146), have expressed their willingness to
accept re-appointment as auditors.

This report was approved by the Board of Directors on 16 April 2024. Signed on behalf of the Board of
Directors:

Gian Carlo Maccagno Datin Wan Daneena Liza Binti Wan Abdul Rahman
DIRECTOR DIRECTOR

Kuala Lumpur

Wasco Berhad 151

Statement by Directors
PURSUANT TO SECTION 251(2) OF THE COMPANIES ACT,2016

We, Gian Carlo Maccagno and Datin Wan Daneena Liza Binti Wan Abdul Rahman, two of the Directors of
Wasco Berhad (formerly known as Wah Seong Corporation Berhad), do hereby state that, in the opinion of the
Directors, the accompanying financial statements set out on pages 159 to 286 are drawn up so as to give a
true and fair view of the financial position of the Group and the Company as at 31 December 2023 and financial
performance of the Group and the Company for the financial year ended 31 December 2023 in accordance with
the Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements
of the Companies Act, 2016 in Malaysia.

Signed on behalf of the Board of Directors in accordance with a resolution of the Directors dated
16 April 2024.

GIAN CARLO MACCAGNO Datin Wan Daneena Liza Binti Wan Abdul Rahman
DIRECTOR DIRECTOR

Kuala Lumpur

Statutory Declaration
PURSUANT TO SECTION 251(1) OF THE COMPANIES ACT,2016
I, Ramanathan A/L P.R. Singaram, the officer primarily responsible for the financial management of Wasco
Berhad (formerly known as Wah Seong Corporation Berhad), do solemnly and sincerely declare that, the
financial statements set out on pages 159 to 286 are, to the best of my knowledge and belief, correct and I
make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of
the Statutory Declarations Act, 1960.

RAMANATHAN A/L P.R. SINGARAM

CA16937

Subscribed and solemnly declared by the abovenamed at Kuala Lumpur in the Federal Territory on
16 April 2024.

Before me:

COMMISSIONER FOR OATHS

152 Integrated Annual Report 2023

 Independent Auditors’ Report
TO THE MEMBERS OF WASCO BERHAD
(formerly known as Wah Seong Corporation Berhad)

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS

Our opinion

In our opinion, the financial statements of Wasco Berhad (“the Company”) (formerly known as Wah Seong
Corporation Berhad) and its subsidiaries (“the Group”) give a true and fair view of the financial position of the
Group and of the Company as at 31 December 2023, and of their financial performance and their cash flows
for the financial year then ended in accordance with Malaysian Financial Reporting Standards, International
Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia.

What we have audited

We have audited the financial statements of the Group and of the Company, which comprise the statements of
financial position as at 31 December 2023 of the Group and of the Company, and the statements of profit or
loss, statements of changes in equity and statements of cash flows of the Group and of the Company for the
financial year then ended, and notes to the financial statements, including material accounting policies, as set
out on pages 159 to 286.

Basis for opinion

We conducted our audit in accordance with approved standards on auditing in Malaysia and International
Standards on Auditing. Our responsibilities under those standards are further described in the “Auditors’
responsibilities for the audit of the financial statements” section of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.

Independence and other ethical responsibilities

We are independent of the Group and of the Company in accordance with the By-Laws (on Professional
Ethics, Conduct and Practice) of the Malaysian Institute of Accountants (“By-Laws”) and the International
Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including
International Independence Standards) (“IESBA Code”), and we have fulfilled our other ethical responsibilities in
accordance with the By-Laws and the IESBA Code.

Our audit approach

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in
the financial statements of the Group and of the Company. In particular, we considered where the Directors
made subjective judgements; for example, in respect of significant accounting estimates that involved making
assumptions and considering future events that are inherently uncertain. As in all of our audits, we also
addressed the risk of management override of internal controls, including among other matters, consideration of
whether there was evidence of bias that represented a risk of material misstatement due to fraud.

We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion on
the financial statements as a whole, taking into account the structure of the Group and of the Company, the
accounting processes and controls, and the industry in which the Group and the Company operate.

Wasco Berhad 153

Independent Auditors’ Report
TO THE MEMBERS OF WASCO BERHAD
(formerly known as Wah Seong Corporation Berhad)

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED)

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial statements of the Group and of the Company for the current financial year. These matters were
addressed in the context of our audit of the financial statements of the Group and of the Company as a whole,
and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matters How our audit addressed the key audit matters

1.0 Impairment assessment for goodwill of CGU A and CGU B

Refer to Note 2.10(a) Goodwill for the accounting Audit procedures performed over this key audit
policy, Note 3(a) – Impairment of goodwill and Note matter were as follows:
7 - Goodwill and Intangible Assets to the financial
statements. l Involved our valuation specialist to assess the
appropriateness of the valuation methodology
As at 31 December 2023, the Group's goodwill used by management;
totalled RM157.8 million which is allocated to the
following cash generating units ("CGU"): l Tested mathematical accuracy of VIU
calculations prepared by management;
• Specialised Pipe Coating and Corrosion
Protection Services (CGU A); and l Compared forecasted revenue to past
performance records, market outlook and
• EPC, Fabrication and Rental of Gas management's expectation and market
Compressors and Process Equipment (CGU B). developments;

We focused on this area due to the size of the l Compared terminal growth rates to external
goodwill and because the recoverable amounts macroeconomic sources of data and industry
of the CGUs are determined based on value in specific trends;
use ("VIU") calculation which involve significant
judgement in determining the key assumptions on l Compared costs to approved budgets and
the future cash flows generated. historical performance;

l Involved our valuation specialist to evaluate the

appropriateness of the discount rates used for
CGU A and CGU B. This involved consideration
of inputs from comparable industries and peer
companies, adjusted for business risk and
marketability;

l Assessed reasonableness of probabilities of

occurrence assigned to best, base and worst
case scenarios for CGU A; and

l Assessed reasonableness of probabilities of

occurrence assigned to base and worst case
scenarios for CGU B.

We also considered the adequacy of disclosures

in the financial statements of key assumptions and
sensitivity analysis for the respective CGUs.

Based on procedures performed, no material

exception was noted.

154 Integrated Annual Report 2023

 Independent Auditors’ Report
TO THE MEMBERS OF WASCO BERHAD
(formerly known as Wah Seong Corporation Berhad)

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED)

Key audit matters (continued)

Key audit matters How our audit addressed the key audit matters

2.0 Impairment assessment on investment in joint venture

Refer to Note 2.6 – Joint arrangement for accounting Audit procedures over this key audit matter were as
policies, Note 3(c) – Impairment of investments follows:
in associates and joint ventures and Note 11
– Investment in joint ventures to the financial l Ascertain the independence and competencies
statements. of the component auditor’s team members,
ensuring that they have the necessary
As at 31 December 2023, the carrying amounts of experience and expertise to undertake the audit
investments in joint venture, Alam-PE Holdings (L) Inc on ALAM-PE;
("Alam-PE") was RM11.4 million.
l Reviewed the component auditor’s planning
Impairment indicators exist due to: procedures, discussed the key audit risks and
the audit approach adopted by the component
l ALAM-PE’s low vessel utilisation (the identified auditor on ALAM-PE;
impairment indicator) in the current financial
year resulted in ALAM-PE continuing to incur l Set out and communicated the relevant group
losses; and reporting protocol, setting out the deliverables
and timelines required to be reported by the
l The significant shortfall of its actual loss and component auditor to us;
the budgeted profits for the current financial
year indicated that the investment may be l Reviewed the deliverables provided by the
impaired. component auditor and discussed the results of
their audit work as well as reviewed their audit
Subsequently, management of Alam-PE performed working papers;
an impairment assessment which resulted in an
impairment charge of RM20 million on its vessels for l Involved our valuation specialist to assess the
the current financial year. Alam-PE reported a net appropriateness of the valuation methodology
loss of RM24.3 million for the financial year ended used by management;
31 December 2023 for which the Group recognised
its share of loss in the joint venture totalling RM11.9 l Involved our valuation specialist to evaluate
million, resulting in the carrying amount of RM11.4 the appropriateness of discount rates used.
million as at 31 December 2023. This involved consideration of inputs from
comparable industries;
We focused on this area because the recoverable
amounts of the investment are determined based l Tested mathematical accuracy of VIU
on higher of fair value less cost to sell and VIU calculations prepared by management;
calculations which involved significant judgements
in determining key assumptions on future cash flows l Compared forecasted revenues to past
generated. per formance records, market outlook
and management’s expectation of market
developments;

l Compared current year EBITDA margin to

historical EBITDA margins;

Wasco Berhad 155

Independent Auditors’ Report
TO THE MEMBERS OF WASCO BERHAD
(formerly known as Wah Seong Corporation Berhad)

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED)

Key audit matters (continued)

Key audit matters How our audit addressed the key audit matters

2.0 Impairment assessment on investment in joint venture (continued)

•  Evaluated the independence, competence,

capabilities and objectivity of the external
valuers; and

• Reviewed the methodology, input and

assumptions adopted by the independent
valuers in estimating the fair value of the
vessels.

We also considered the adequacy of disclosures in

the financial statements of the key assumptions and
sensitivity analysis for the investment.

Based on the procedures performed, no material

exception was noted.

We have determined that there are no key audit matters to report for the Company.

Information other than the financial statements and auditors’ report thereon

The Directors of the Company are responsible for the other information. The other information comprises the
Directors’ Report, Statement on Risk Management and Internal Control and other sections of Annual Report
2023, but does not include the financial statements of the Group and of the Company and our auditors’ report
thereon.

Our opinion on the financial statements of the Group and of the Company does not cover the other information
and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements of the Group and of the Company, our responsibility is
to read the other information and, in doing so, consider whether the other information is materially inconsistent
with the financial statements of the Group and of the Company or our knowledge obtained in the audit or
otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the financial statements

The Directors of the Company are responsible for the preparation of the financial statements of the Group and
of the Company that give a true and fair view in accordance with Malaysian Financial Reporting Standards,
International Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia. The
Directors are also responsible for such internal control as the Directors determine is necessary to enable the
preparation of financial statements of the Group and of the Company that are free from material misstatement,
whether due to fraud or error.

In preparing the financial statements of the Group and of the Company, the Directors are responsible for
assessing the Group’s and the Company’s ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless the Directors either
intend to liquidate the Group or the Company or to cease operations, or have no realistic alternative but to do
so.

156 Integrated Annual Report 2023

 Independent Auditors’ Report
TO THE MEMBERS OF WASCO BERHAD
(formerly known as Wah Seong Corporation Berhad)

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED)

Auditors’ responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements of the Group
and of the Company as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance with approved standards on auditing in Malaysia and
International Standards on Auditing will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these financial
statements.

As part of an audit in accordance with approved standards on auditing in Malaysia and International Standards
on Auditing, we exercise professional judgement and maintain professional scepticism throughout the audit. We
also:

(a) Identify and assess the risks of material misstatement of the financial statements of the Group and of the
Company, whether due to fraud or error, design and perform audit procedures responsive to those risks,
and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control.

(b) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the Group’s and of the Company’s internal control.

(c) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by the Directors.

(d) Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Group’s or on the Company’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our
auditors’ report to the related disclosures in the financial statements of the Group and of the Company or,
if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group
or the Company to cease to continue as a going concern.

(e) Evaluate the overall presentation, structure and content of the financial statements of the Group and of
the Company, including the disclosures, and whether the financial statements of the Group and of the
Company represent the underlying transactions and events in a manner that achieves fair presentation.

(f) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial statements of the Group.
We are responsible for the direction, supervision and performance of the group audit. We remain solely
responsible for our audit opinion.

We communicate with the Directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.

We also provide the Directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards
applied.

Wasco Berhad 157

Independent Auditors’ Report
TO THE MEMBERS OF WASCO BERHAD
(formerly known as Wah Seong Corporation Berhad)

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED)

Auditors’ responsibilities for the audit of the financial statements (continued)

From the matters communicated with the Directors, we determine those matters that were of most significance
in the audit of the financial statements of the Group and of the Company for the current financial year and
are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation
precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

In accordance with the requirements of the Companies Act 2016 in Malaysia, we report that the subsidiaries of
which we have not acted as auditors, are disclosed in Note 9 to the financial statements.

OTHER MATTERS

This report is made solely to the members of the Company, as a body, in accordance with Section 266 of the
Companies Act 2016 in Malaysia and for no other purpose. We do not assume responsibility to any other person
for the content of this report.

PRICEWATERHOUSECOOPERS PLT TIANG WOON MENG

LLP0014401-LCA & AF 1146 02927/05/2024 J
Chartered Accountants Chartered Accountant

Kuala Lumpur
16 April 2024

158 Integrated Annual Report 2023

 Statements of Financial Position
AS AT 31 DECEMBER 2023

Group Company
Note 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

NON-CURRENT ASSETS

Property, plant and equipment 4 563,420 473,336 146 6,637

Right-of-use assets 5(a) 276,834 299,903 - -
Investment properties 6 6,412 9,046 - 17,145
Goodwill and other intangible assets 7 158,083 153,132 - -
Deferred tax assets 8 26,719 50,117 - 4,310
Investment in subsidiaries 9 - - 736,095 737,424
Investment in associates 10 112,742 101,818 - -
Investment in joint ventures 11 20,180 32,700 - -
Trade and other receivables 14 3,603 3,451 - -
Amounts owing by joint ventures 17(a) 23,849 31,606 - -
Contract assets 12 - 14,266 - -

1,191,842 1,169,375 736,241 765,516

CURRENT ASSETS

Inventories 13 186,324 223,395 - -

Contract assets 12 446,339 381,548 - -
Trade and other receivables 14 563,572 558,291 515 666
Amounts owing by subsidiaries 15(a) - - 16,121 18,497
Amounts owing by associates 16 180 124 - -
Amounts owing by joint ventures 17(a) 146 205 - -
Tax recoverable 15,478 10,590 248 196
Derivative financial assets 18 154 82 - -
Time deposits 19 103,181 53,081 684 1,466
Cash and bank balances 20 307,163 275,929 2,915 1,801

1,622,537 1,503,245 20,483 22,626

Assets classified as held for sale 21 12,090 16,171 23,322 -

Assets of disposal group classified as
held for sale 22 120,181 24,659 - -

TOTAL ASSETS 2,946,650 2,713,450 780,046 788,142

Wasco Berhad 159

Statements of Financial Position
AS AT 31 DECEMBER 2023

Group Company
Note 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

EQUITY AND LIABILITIES

CAPITAL AND RESERVES ATTRIBUTABLE

TO OWNERS OF THE COMPANY

Share capital 23 547,690 547,690 547,690 547,690

Treasury shares 24 (624) (624) (624) (624)
Exchange translation reserves 13,566 8,346 - -
Retained profits 144,174 24,582 151,385 138,895

704,806 579,994 698,451 685,961

Non-controlling interests 115,584 98,914 - -

TOTAL EQUITY 820,390 678,908 698,451 685,961

NON-CURRENT AND DEFERRED

LIABILITIES

Deferred tax liabilities 8 8,957 8,267 14 -

Lease liabilities 206,527 215,160 - -
Trade and other payables 25 50,525 29,192 - -
Loans and borrowings 26 50,916 81,885 - -

316,925 334,504 14 -

CURRENT LIABILITIES

Lease liabilities 20,348 21,447 - -

Contract liabilities 12 319,826 314,049 - -
Trade and other payables 25 595,612 533,671 1,148 20,057
Provision for warranties 27 35,510 22,687 - -
Amounts owing to subsidiaries 15(b) - - 35,433 22,410
Amounts owing to joint ventures 17(b) 7,573 3,493 - -
Loans and borrowings 26 652,046 708,081 45,000 59,714
Dividend payable 4,450 10,200 - -
Current tax liabilities 68,294 64,824 - -
Derivative financial liabilities 18 4,100 2,627 - -

1,707,759 1,681,079 81,581 102,181

Liabilities of disposal group classified as

held for sale 22 101,576 18,959 - -

TOTAL LIABILITIES 2,126,260 2,034,542 81,595 102,181

TOTAL EQUITY AND LIABILITIES 2,946,650 2,713,450 780,046 788,142

160 Integrated Annual Report 2023

 Statements of Profit or Loss
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Group Company
Note 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-presented)

Gross revenue 28 2,605,688 2,366,081 26,598 30,208

Cost of sales 29 (2,159,848) (1,977,103) - -

Gross profit 445,840 388,978 26,598 30,208

Other operating income 64,549 52,565 3,206 2,006
Selling and distribution expenses (26,876) (36,684) - -
Administrative and general expenses (215,744) (184,572) (7,490) (16,570)
Loss of impairment on non-financial
assets (1,866) - (3,789) (4,656)
Reversal/(Loss) of impairment on
financial assets 7,926 (28,211) 2,442 (2,517)
Other losses - net 30 (1,374) (2,422) - -

Profit from operations 31 272,455 189,654 20,967 8,471

Finance costs 32 (58,737) (43,295) (3,812) (4,097)
Share of results of associates 16,307 (11,614) - -
Share of results of joint ventures (11,769) (11,336) - -
Impairment of investment in associates 10 - (39,537) - -
Impairment of investment in joint
ventures 11 - (8,989) - -

Profit before tax 218,256 74,883 17,155 4,374

Tax expense 33 (68,133) (38,924) (4,665) (126)

Profit from continuing operations 150,123 35,959 12,490 4,248

Profit from discontinued operation 22 4,705 7,171 - -

Net profit for the financial year 154,828 43,130 12,490 4,248

Net profit/(loss) for the financial year

attributable to:
Owners of the Company 108,402 (6,300) 12,490 4,248
Non-controlling interests 46,426 49,430 - -

Net profit for the financial year 154,828 43,130 12,490 4,248

Earnings/(Loss) per share computed

based on the net profit/(loss) for
the financial year attributable to the
owners of the Company:
- basic and diluted (sen) 34 14.00 (0.81)

Wasco Berhad 161

Statements of Other Comprehensive Income
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Group Company
Note 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-presented)

Net profit for the financial year 154,828 43,130 12,490 4,248

Other comprehensive income/(expense):

Items that may be subsequently

reclassified to profit or loss:
Foreign currency translation differences
for foreign operations 3,202 (3,233) - -
Share of other comprehensive income of
joint ventures, net of tax 3,507 932 - -

Other comprehensive income/(expense)

for the financial year, net of tax 6,709 (2,301) - -

Total comprehensive income for the

financial year 161,537 40,829 12,490 4,248

Total comprehensive income/(expense)

for the financial year attributable to:
Owners of the Company 113,404 (8,509) 12,490 4,248
Non-controlling interests 48,133 49,338 - -

Total comprehensive income for the

financial year 161,537 40,829 12,490 4,248

Total comprehensive income/(expense)

attributable to owners of the Company
arises from:
Continuing operations 108,920 (14,983) 12,490 4,248
Discontinued operations 4,484 6,474 - -

Total comprehensive income/(expense)

for the financial year 113,404 (8,509) 12,490 4,248

162 Integrated Annual Report 2023

 Attributable to owners of the Company
Exchange Non-
Share Treasury translation Retained controlling Total
Note capital shares reserves profits Total interests equity

Wasco Berhad
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

At 1 January 2023 547,690 (624) 8,346 24,582 579,994 98,914 678,908

Net profit for the financial year - - - 108,402 108,402 46,426 154,828
Other comprehensive income for the financial
year - - 5,002 - 5,002 1,707 6,709

Total comprehensive income for the financial

year - - 5,002 108,402 113,404 48,133 161,537

Transactions with owners:

Dividend paid/payable to non-controlling

interests - - - - - (1,088) (1,088)
Acquisition of shares in existing subsidiary
from non-controlling interests - - - 11,190 11,190 (26,864) (15,674)
Disposal of subsidiaries - - 218 - 218 (3,511) (3,293)
Total transactions with owners - - 218 11,190 11,408 (31,463) (20,055)
At 31 December 2023 547,690 (624) 13,566 144,174 704,806 115,584 820,390
Changes in Equity

163
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023
Consolidated Statement of
 Attributable to owners of the Company

164
Exchange Non-
Share Treasury translation Retained controlling Total
Note capital shares reserves profits Total interests equity
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

At 1 January 2022 547,690 (624) 10,555 30,882 588,503 49,658 638,161

Net (loss)/profit for the financial year - - - (6,300) (6,300) 49,430 43,130
Other comprehensive expense for the financial
year - - (2,209) - (2,209) (92) (2,301)

Total comprehensive (expense)/income for the

financial year - - (2,209) (6,300) (8,509) 49,338 40,829
Changes in Equity

Transactions with owners:

Dividend paid/payable to non-controlling

interests - - - - - (488) (488)
Acquisition of shares in existing subsidiary by
non-controlling interests - - - - - 406 406
Consolidated Statement of

Total transactions with owners - - - - - (82) (82)

At 31 December 2022 547,690 (624) 8,346 24,582 579,994 98,914 678,908

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Integrated Annual Report 2023

 Company Statement of Changes in Equity
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Share Treasury Retained Total

Note capital shares profits equity
RM’000 RM’000 RM’000 RM’000

At 1 January 2023 547,690 (624) 138,895 685,961

Total comprehensive income for the
financial year - - 12,490 12,490

At 31 December 2023 547,690 (624) 151,385 698,451

At 1 January 2022 547,690 (624) 134,647 681,713

Total comprehensive income for the
financial year - - 4,248 4,248

At 31 December 2022 547,690 (624) 138,895 685,961

Wasco Berhad 165

Statements of Cash Flows
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Group Company
Note 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

CASH FLOWS FROM OPERATING

ACTIVITIES

Profit before tax

Continuing operations 218,256 74,883 17,155 4,374
Discontinued operation 6,145 7,138 - -

224,401 82,021 17,155 4,374

Adjustments for:

Property, plant and equipment:

- Depreciation charge 56,195 41,783 138 156
- Impairment charge 1,847 - - -
- Written off 137 1,530 88 -
- Net (gain)/loss on disposal (238) 497 (56) -
Investment properties:
- Depreciation charge 195 222 213 212
- Impairment charge 19 - - -
Right-of-use assets:
- Depreciation charge 26,583 28,555 - -
Inventories:
- Allowance for obsolescence 788 2,877 - -
- Write back of allowance for obsolescence (1,777) (369) - -
- Written off 1,306 473 - -
Net (gain)/loss on disposal of:
- assets classified as held for sale (23,095) (5,150) - -
- associate - (2,142) - -
- subsidiary 305 - - -
Share of results of associates (16,307) 11,614 - -
Share of results of joint ventures 11,769 11,336 - -
Trade and other receivables:
- Net (reversal)/impairment charge (5,463) 7,150 - -
- (Recovered)/Written off (352) 119 - 23

166 Integrated Annual Report 2023

 Statements of Cash Flows
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Group Company
Note 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

CASH FLOWS FROM OPERATING

ACTIVITIES (CONTINUED)

Adjustments for: (continued)

(Reversal)/Impairment loss on:

- amounts owing by associate (10,216) 21,270 - (43)
- amounts owing by joint ventures 8,065 - - -
- amounts owing by subsidiaries - - (2,442) 2,560
- investment in subsidiaries - - 3,789 4,656
- investment in an associate - 39,537 - -
- investment in a joint venture - 8,989 - -
Net provision for warranties 12,117 9,784 - -
Net unrealised (gain)/loss on foreign
exchange (4,294) (11,269) - 97
Dividend income - - (21,302) (22,440)
Interest income (5,466) (4,378) (1,323) (949)
Interest expense 62,510 45,377 3,812 4,097
Fair value loss on:
- derivative financial instruments 976 2,145 - -

340,005 291,971 72 (7,257)

Changes in working capital:

Inventories 3,869 (54,682) - -
Receivables (100,292) (364,582) 4,070 4,689
Payables 95,723 354,443 (6,373) (3,363)

Cash generated from/(used in) operations 339,305 227,150 (2,231) (5,931)

Interest received 5,466 4,378 1,323 949
Interest paid (62,508) (43,857) (3,812) (4,097)
Tax paid (42,589) (21,426) (393) (403)

Net cash generated from/(used in)

operating activities 239,674 166,245 (5,113) (9,482)

Wasco Berhad 167

Statements of Cash Flows
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Group Company
Note 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

CASH FLOWS FROM INVESTING

ACTIVITIES

Purchase of property, plant and equipment (127,533) (36,645) (129) (139)

Additional investment in subsidiaries (2,075) - (2,560) -
Acquisition of a subsidiary, net of cash
acquired 37 - (65,388) - -
Subscription of shares in subsidiary by
non-controlling interest - 406 - -
Proceeds from disposal of:
- property, plant and equipment 2,772 1,481 60 -
- assets held for sale 46,227 10,557 - -
- associate - 30,800 - -
- subsidiaries 4,128 - - -
Transfer from deposits and short term
investment 158 305 - 653
Dividends received from:
- subsidiaries - - 21,302 22,440
- a joint venture 1,070 4,406 - -
- an associate 2,787 1,817 - -
Net cash of disposal group 22 (13,856) (11,841) - -
Redemption of NCRPS in a subsidiary - - 1,000 -
Repayments from subsidiaries - - - 26,345
Net repayment from joint ventures - 104 - -

Net cash (used in)/generated from

investing activities (86,322) (63,998) 19,673 49,299

168 Integrated Annual Report 2023

 Statements of Cash Flows
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Group Company
Note 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

CASH FLOWS FROM FINANCING

ACTIVITIES

Repayments of term loans (25,832) (89,970) - -

Drawdown from other bank borrowings 1,064,743 833,456 10,000 15,000
Repayments of other bank borrowings (1,084,438) (737,306) (24,766) (57,449)
Repayment of fixed rate notes (1,396) - - -
Net advances/(repayments) to subsidiaries - - 488 (1,858)
Dividends paid to non-controlling interests (6,838) (5,688) - -
Lease payment (principal portion) (22,006) (16,610) - -

Net cash used in financing activities (75,767) (16,118) (14,278) (44,307)

NET CHANGES IN CASH AND CASH

EQUIVALENTS 77,585 86,129 282 (4,490)

CASH AND CASH EQUIVALENTS AT

BEGINNING OF THE FINANCIAL YEAR 305,495 218,153 3,267 7,854

EFFECTS OF EXCHANGE RATE CHANGES 3,596 1,213 50 (97)

CASH AND CASH EQUIVALENTS AT END

OF THE FINANCIAL YEAR 386,676 305,495 3,599 3,267

Represented by:

TIME DEPOSITS 19 103,181 53,081 684 1,466

CASH AND BANK BALANCES 20 307,163 275,929 2,915 1,801

410,344 329,010 3,599 3,267

LESS:
TIME DEPOSITS WITH MATURITY MORE
THAN 3 MONTHS 19 (23,668) (23,515) - -

CASH AND CASH EQUIVALENTS 386,676 305,495 3,599 3,267

Wasco Berhad 169

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

1 GENERAL INFORMATION

The Company is a public limited liability company, incorporated and domiciled in Malaysia, and listed on
the Main Market of Bursa Malaysia Securities Berhad. The address of its registered office and principal
place of business are as follows:

Registered office and principal place of business:

Suite 19.01, Level 19
The Gardens North Tower
Mid Valley City
Lingkaran Syed Putra
59200 Kuala Lumpur

The principal activities of the Company are investment holding and provision of management services to
its subsidiaries.

The principal activities of the Group consist of specialised pipe coating and corrosion protection services;
Engineering, Procurement and Construction (“EPC”) of gas compressors and process equipment and
provision of bioenergy services. See Notes 9 and 43 to the financial statements for further details.

The financial statements are presented in Ringgit Malaysia (“RM”), which is also the Company’s functional
currency. Unless otherwise indicated, the amounts in these financial statements have been rounded to the
nearest thousand.

These financial statements were authorised for issue by the Directors on 16 April 2024.

2 MATERIAL ACCOUNTING POLICIES

Unless otherwise stated, the following accounting policies have been applied consistently in dealing with
items that are considered material in relation to the financial statements.

2.1 Basis of preparation

The financial statements of the Group and the Company have been prepared in accordance with
the Malaysian Financial Reporting Standards (“MFRS”), International Financial Reporting Standards
(“IFRS”) and the requirements of Companies Act, 2016 in Malaysia.

The financial statements have been prepared under the historical cost convention unless otherwise
indicated in this summary of significant accounting policies.

The preparation of financial statements in conformity with MFRS requires the use of certain critical
accounting estimates and assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reported period. It also requires Directors
to exercise their judgement in the process of applying the Group’s and the Company’s accounting
policies. Although these estimates and judgement are based on the Directors’ best knowledge of
current events and actions, actual results may differ.

The areas involving a higher degree of judgement or complexity, or areas where assumptions
and estimates are significant to the financial statements are disclosed in Note 3 to the financial
statements.

170 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.2 Changes in accounting policies and disclosures

Standards, amendments to published standards and interpretations to existing standards that are
applicable to the Group and the Company but not yet effective

• Amendments to MFRS 101 ‘Classification of liabilities as current or non-current’ clarify that

liabilities are classified as either current or non-current, depending on the rights that exist at the
end of the reporting period. Classification is unaffected by the entity’s expectations or events
after the reporting date (e.g. the receipt of a waiver or a breach of covenant).

• Amendments to MFRS 101 ‘Non-current Liabilities with Covenants’ specify that covenants of
loan arrangements which an entity must comply with only after the reporting date would not
affect classification of a liability as current or non-current at the reporting date. However, those
covenants that an entity is required to comply with on or before the reporting date would affect
classification of a liability as current or non-current, even if the covenant is only assessed after
the reporting date.

Both amendments are effective for the annual reporting periods beginning on or after 1 January
2024.

The amendments shall be applied retrospectively.

2.3 Subsidiaries

Subsidiaries are those corporations, partnerships or other entities (including special purpose entities)
over which the Group has power to exercise control over variable returns from its involvement with
the entity and has the ability to affect those returns through its power to direct the relevant activities
of the entity. Potential voting rights are considered when assessing control only when such rights are
substantive.

In the Company’s separate financial statements, investments in subsidiaries are stated at cost
less accumulated impairment losses, if any. Where an indication of impairment exists, the carrying
amount of the investment is assessed and written down immediately to its recoverable amount. See
accounting policy 2.13 on impairment of non-financial assets.

Subsidiaries acquired from other companies within Wasco Berhad (formerly known as Wah Seong
Corporation Berhad) Group as part of Group Reorganisation is accounted for under the “Predecessor
Accounting” method as these were entities under common control. Under the predecessor method of
accounting, the subsidiaries are consolidated as if the subsidiaries have always been part of Wasco
Berhad (formerly known as Wah Seong Corporation Berhad) Group. Assets and liabilities acquired
are not restated to their respective fair values and are recognised as the carrying amounts. The
difference between any consideration given and the aggregate carrying amounts of the assets and
liabilities of the acquired entity is recognised as an adjustment to equity. No additional goodwill is
recognised.

Other subsidiaries are consolidated using the acquisition method of accounting. Under the acquisition
method of accounting, subsidiaries are fully consolidated from the date on which control is
transferred to the Group and are de-consolidated from the date that control ceases. The cost of an
acquisition is measured as the fair value of the assets given, equity interests issued and liabilities
incurred or assumed at the date of exchange. Acquisition-related costs are expensed to profit or
loss as and when incurred. The cost of acquisition includes the fair value of any asset or liability
resulting from a contingent consideration. Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are, measured initially at their fair values at the date
of acquisition. The excess of the cost of acquisition over the fair value of the Group’s share of the
identifiable net assets acquired at the date of acquisition is reflected as goodwill in the statement of
financial position – see accounting policy 2.10(a) on goodwill. If the cost of acquisition is less than
the fair value of the Group’s share of identifiable net assets of the subsidiary acquired, the difference
is recognised directly in the profit or loss.

Wasco Berhad 171

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.3 Subsidiaries (continued)

If a business combination achieved in stages, the previously held equity interest in the acquiree is
remeasured to its fair value on the date it becomes a subsidiary and the resulting gain or loss is
recognised in profit or loss.

All intercompany transactions, balances and unrealised gains on transactions between group
companies are eliminated. Unrealised losses are also eliminated unless the transaction provides
evidence of impairment of the asset transferred. When necessary, amounts reported by subsidiaries
have been adjusted to conform with the Group’s accounting policies.

Non-controlling interests represent that portion of the profit or loss, other comprehensive income
and net assets of a subsidiary attributable to equity interests that are not owned, directly or indirectly
through subsidiaries, by the Company. It is measured at the non-controlling’s share of the fair value of
the subsidiaries’ identifiable assets and liabilities at the date of acquisition and the non-controlling’s
share of changes in the subsidiaries’ equity since that date.

All earnings and losses of the subsidiary are attributed to the parent and non-controlling interest,
even if the attribution of losses to the non-controlling interest results in a debit balance.

The gain or loss on disposal of a subsidiary, which is the difference between net disposal proceeds
and the Group’s share of its net assets as of the date of disposal, including the cumulative amount
of any exchange differences that relate to the subsidiary, is recognised in the consolidated profit or
loss.

2.4 Transactions with non-controlling interests

The Group applies a policy of treating transactions with non-controlling interests as transactions
with equity owners of the Group. Effects of transactions with non-controlling interests are directly
recognised in equity to the extent that there is no change in control. The difference between the
fair value of any consideration paid/received and the carrying amount of the share of net assets
acquired/sold are recorded in equity. Accordingly, such transactions will no longer result in goodwill
or gains and losses upon disposal.

2.5 Associates

An associate is an entity in which the Group has significant influence and that is neither a subsidiary
nor an interest in a joint venture. Significant influence is the power to participate in the financial and
operating policy decisions of the investee, but not control or joint control over those policies.

Investment in associates is accounted for in the consolidated financial statements using the equity
method of accounting. Under the equity method, investment in associates is initially recognised at
cost and adjusted thereafter for post-acquisition changes in the Group’s share of net assets of the
associates.

The Group’s share of the associate’s post-acquisition profit or loss and other comprehensive income
are recognised in the consolidated profit or loss and other comprehensive income respectively.
The cumulative post-acquisition movements are adjusted against the carrying amounts of the
investments. Dividends received or receivable from an associate are recognised as a reduction in the
carrying amount of the investment.

An investment in an associate is accounted for using the equity method from the date on which the
Group obtains significant influence until the date the Group ceases to have significant influence over
the associate.

Goodwill relating to an associate is included in the carrying value of the investment and is not tested
for impairment separately.

172 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.5 Associates (continued)

Any excess of the Group’s share of the net fair value of the associate’s identifiable assets, liabilities
and contingent liabilities over the cost of the investment is excluded from the carrying amount of
the investment and is instead included as income in the determination of the Group’s share of the
associate’s profit or loss for the financial period in which the investment is acquired.

Unrealised gains on transactions between the Group and its associates are eliminated to the extent
of the Group’s interest in the associates. Unrealised losses are also eliminated unless the transaction
provides evidence of impairment of the asset transferred. Where necessary, adjustments are made to
the financial statements of associates to ensure consistency of accounting policies with those of the
Group.

Equity accounting is discontinued when the carrying amount of the investment in an associate
diminishes by virtue of losses to zero, unless the Group has incurred legal or constructive obligations
or made payments on behalf of the associate. If the associate subsequently reports profits, the Group
resumes recognising its share of those profits only after its share of the profits equals the share of
losses not recognised.

For incremental interest in an associate, the date of acquisition is the purchase date at each stage
and goodwill is calculated at each purchase date based on the fair value of assets and liabilities
identified. There is no “step up to fair value” of net assets of the previously acquired stake and the
share of profits and equity movements for the previously acquired stake is recorded directly through
equity.

The Group determines at each reporting date whether there is any objective evidence that the
investment in associates is impaired. Where an indication of impairment exists, the carrying amount of
the investment is assessed and written down immediately to its recoverable amount. See accounting
policy 2.13 on impairment of non-financial assets.

On disposal, the difference between the net disposal proceeds and the net carrying amount of the
associate disposed is taken to the profit or loss.

In the Company’s separate financial statements, investment in associates is stated at cost less
impairment loss.

2.6 Joint arrangements

A joint arrangement is an arrangement of which there is contractually agreed sharing of control by

the Group with one or more parties, where decisions about the relevant activities relating to the joint
arrangement require unanimous consent of the parties sharing control. The classification of a joint
arrangement as a joint operation or a joint venture depends upon the rights and obligations of the
parties to the arrangement. A joint venture is a joint arrangement whereby the joint venturers have
rights to the net assets of the arrangement. A joint operation is a joint arrangement whereby the joint
operators have rights to the assets and obligations for the liabilities, relating to the arrangement.

The Group has interests in joint venture, which are accounted for in the consolidated financial
statements using the equity method of accounting after initially being recognised as cost. Equity
accounting involves recognising the Group’s share of the post-acquisition profit or loss and other
comprehensive income within consolidated profit or loss and other comprehensive income
respectively. The cumulative post-acquisition movements are adjusted against the cost of investment
and include goodwill on acquisition (net of accumulated impairment loss). Dividends received
or receivable from a joint venture are recognised as a reduction in the carrying amount of the
investment.

When the Group’s share of losses in a joint venture equals or exceeds its interest in the joint venture,
including any long term interests that, in substance, form part of the Group’s net investment in the
joint venture, the Group does not recognise further losses unless it has incurred legal or constructive
obligations or made payments on behalf of the joint venture.

Wasco Berhad 173

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.6 Joint arrangements (continued)

The Group recognises the portions of gains or losses on the sale of assets by the Group to the joint
venture that is attributable to other venturers. The Group does not recognise its share of profits or
losses from the joint venture that result from the purchase of assets by the Group from the joint
venture until it resells the assets to an independent party. However, a loss on the transaction is
recognised immediately if the loss provides evidence of a reduction in the net realisable value of
assets or an impairment loss.

The Group determines at each reporting date whether there is any objective evidence that the
investment in joint ventures is impaired. Where an indication of impairment exists, the carrying
amount of the investment is assessed and written down immediately to its recoverable amount. See
accounting policy 2.13 on impairment of non-financial assets.

Unrealised gains on transactions between the Group and its joint ventures are eliminated to the
extent of the Group’s interest in the joint ventures. Unrealised losses are also eliminated unless the
transaction provides evidence of impairment of the asset transferred. Where necessary, adjustments
are made to the financial statements of joint ventures to ensure consistency of accounting policies
with those of the Group.

On disposal, the difference between the net disposal proceeds and the carrying amount of the joint
venture disposed is included in the profit or loss.

In the Company’s separate financial statements, investment in joint ventures is stated at cost less
accumulated impairment loss.

2.7 Property, plant and equipment

(a) Measurement basis

Property, plant and equipment are stated at cost less accumulated depreciation and
accumulated impairment losses, if any.

The cost of property, plant and equipment initially recognised includes purchase price, import
duties, non-refundable purchase taxes and any expenditure that is directly attributable to the
acquisition of the assets.

Cost also includes borrowing costs that are directly attributable to the acquisition, construction
or production of a qualifying asset. See accounting policy 2.24 on borrowing costs. Items such
as spare parts are recognised when they meet the definition of property, plant and equipment.
Otherwise, such items are classified as inventory. Dismantlement, removal or restoration
costs are included as part of the cost of property, plant and equipment if the obligation for
dismantlement, removal or restoration is incurred as a consequence of acquiring or using the
asset.

Subsequent costs are included in the asset’s carrying amount when it is probable that future
economic benefits associated with the asset will flow to the Group and the Company and
the cost of the asset can be measured reliably. The carrying amount of the replaced part is
derecognised. All other repair and maintenance costs are charged to the profit or loss during the
financial year in which they are incurred.

At each reporting date, the Group and the Company assess whether there is any indication
of impairment. Where an indication of impairment exists, the carrying value of the asset is
assessed and written down immediately to its recoverable amount. See accounting policy 2.13
on impairment of non-financial assets.

Property, plant and equipment are derecognised upon disposal or when no future economic
benefits are expected from their use. Gains and losses on disposals are determined by
comparing proceeds with carrying amounts and are included in the profit or loss in the financial
year the asset is derecognised.

174 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.7 Property, plant and equipment (continued)

(b) Depreciation

Freehold land is not depreciated as it has an indefinite life. Depreciation on capital work-in-
progress commences when the assets are ready for their intended use.

Depreciation is calculated to write off the depreciable amount of other property, plant and
equipment on a straight line basis over their estimated useful lives. The depreciable amount is
determined after deducting residual value from cost. The estimated useful lives of the property,
plant and equipment are as follows:

Buildings 10 - 50 years
Plant, machinery, tools and equipment 2 - 25 years
Electrical installations, computer and office equipment, furniture and fittings 3 - 10 years
Motor vehicles 3-5 years
Renovation, yard development and store extension 2 - 50 years

Assets under construction included in plant and equipment are not depreciated as these assets
are yet to be available for use.

The residual values, useful lives and depreciation methods are reviewed, and adjusted if
appropriate, at the end of each financial year.

2.8 Leases

The Group recognises leases as right-of-use asset and a corresponding liability at the date on which
the leased asset is available for use (i.e. the commencement date).

Accounting as lessee

(a) Lease term

The Group leases various offices, warehouses and motor vehicles. Rental contracts are typically
made for fixed periods of 2 to 14 years (2022: 2 to 15 years), but may have extension options.

Lease terms are negotiated on an individual basis and contain a wide range of different terms
and conditions. The lease agreements do not impose any covenants other than the security
interests in the leased assets that are held by the lessor. Leased assets may not be used as
security for borrowing purposes.

Extension and termination options are included in a number of property leases across the Group.
These are used to maximise operational flexibility in terms of managing the assets used in the
Group’s operations. The majority of extension and termination options held are exercisable only
by the Group and not by the respective lessor.

In determining the lease term, the Group considers all facts and circumstances that create an
economic incentive on whether to exercise an extension option. Extension options (or periods
after termination options) are only included in the lease term if the lease is reasonably certain to
be extended (or not to be terminated).

The Group reassess the lease term upon the occurrence of a significant event or change in
circumstances that is within the control of the Group and affects whether the Group is
reasonably certain to exercise an option not previously included in the determination of lease
term, or not to exercise an option previously included in the determination of lease term. A
revision in lease term results in remeasurement of the lease liabilities – see accounting policy
2.8(d).

Wasco Berhad 175

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.8 Leases (continued)

Accounting as lessee (continued)

(b) Right-of-use assets

Right-of-use assets are initially measured at cost comprising the following:

• the amount of the initial measurement of lease liability;

• any lease payments made at or before the commencement date less any lease incentive
received;
• any initial direct costs; and
• decommissioning or restoration costs.

Right-of-use assets are subsequently measured at cost, less accumulated depreciation and
impairment loss. The right-of-use assets are depreciated over the shorter of the asset’s useful
life and the lease term on a straight line basis. If the Group is reasonably certain to exercise a
purchase option, the right-of-use asset is depreciated over the underlying asset’s useful life. In
addition, the right-of-use assets are adjusted for certain remeasurement of the lease liabilities.

Right-of-use assets are depreciated over the remaining period of the respective leases ranging
from 1 to 91 years (2022:1 to 92) years.

(c) Lease liabilities

Lease liabilities are initially measured at the present value of the lease payments that are not
paid at that date. The lease payments include the following:

• fixed payments (including in-substance fixed payments), less any lease incentive
receivable;
• variable lease payments that are based on an index or rate, initially measured using the
index or rate as at the commencement date;
• amounts expected to be payable by the Group under residual value guarantees;
• the exercise price of a purchase and extension options if the Group is reasonably certain to
exercise that option; and
• payments of penalties for terminating the lease, if the lease term reflects the Group
exercising that option.

Lease payments are discounted using the interest rate implicit in the lease. If that rate cannot
be readily determined, the lessee’s incremental borrowing rate is used.

Lease payments are allocated between principal and interest expense. Interest expense is
charged to profit or loss over the lease period so as to produce a constant periodic rate of
interest on the remaining balance of the liability for each period.

The Group presents the lease liabilities as a separate line item in the statement of financial
position. Interest expense on the lease liabilities is presented within the finance cost in profit or
loss.

(d) Reassessment of lease liabilities

The Group is exposed to potential future increases in variable lease payments that depend
on an index or rate, which are not included in the lease liability until they take effect. When
adjustments to lease payments based on an index or rate take effect, the lease liability is
remeasured and adjusted against the right-of-use assets.

176 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.8 Leases (continued)

Accounting as lessee (continued)

(e) Short-term leases and leases of low-value assets

Short-term leases are leases with a lease term of 12 months or less. Low-value assets comprise
IT equipment and small items of office furniture. Payments associated with short-term leases
and leases of low-value assets are recognised on a straight line basis as an expense in profit or
loss.

Accounting as lessor

As a lessor, the Group and the Company determine at lease inception whether each lease is a finance
lease or an operating lease. To classify each lease, the Group and the Company make an overall
assessment of whether the lease transfers substantially all of the risks and rewards incidental to
ownership of the underlying assets to the lessee. As part of this assessment, the Group and the
Company consider certain indicators such as whether the lease is for the major part of the economic
life of the asset.

(a) Finance leases

The Group leases its compressors under finance leases to non-related parties, where the Group
transfers substantially all the risks and rewards incidental to ownership.

When assets are leased out under a finance lease, the present value of the lease payments is
recognised as a receivable. The receivable is subject to MFRS 9 impairment (See accounting
policy 2.17(d) on impairment of financial assets). The difference between the gross receivable
and the present value of the receivable is recognised as unearned finance income.

Lease income is recognised over the term of the lease using the net investment method so as to
reflect a constant periodic rate of return. The Group revises the lease income allocation if there
is a reduction in the estimated unguaranteed residual value.

(b) Operating leases

The Group and the Company lease its investment properties under operating leases to non-
related parties. The Group also leases its plant and equipment under operating leases to an
associate.

Leases of investment properties and equipment, where the Group and the Company retain
substantially all risks and rewards incidental to ownership, are classified as operating leases.
Rental income from operating leases is recognised in profit or loss on a straight line basis over
the lease term. Contingent rents are recognised as revenue in the period in which they are
earned.

During the financial year, operating lease income from lease contracts in which the Group and
the Company act as a lessor is RM23,761,000 (2022: RM7,814,000) and RM1,592,000 (2022:
RM1,506,000) respectively.

Wasco Berhad 177

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.8 Leases (continued)

Accounting as lessor (continued)

(b) Operating leases (continued)

Minimum lease receivables on investment properties and equipment are as follows:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Not later than 1 year 12,757 1,746 1,328 1,549

Later than 1 year and not later than
2 years 11,787 861 187 861
Later than 2 years and not later
than 5 years 10,133 54 - 54

34,677 2,661 1,515 2,464

2.9 Investment properties

Investment properties are properties held to earn rental income or for capital appreciation or both
rather than for use in the production or supply of goods and services or for administrative purposes,
or sale in the ordinary course of business.

(a) Measurement basis

Investment properties are stated at cost less accumulated depreciation and accumulated
impairment losses, if any.

The cost of investment properties includes expenditure that is directly attributable to the
acquisition of the asset.

Subsequent costs are included in the asset’s carrying amount when it is probable that future
economic benefits associated with the asset will flow to the Group and the Company and the
cost of the asset can be measured reliably. All other repair and maintenance costs are charged
to the profit or loss during the financial year in which they are incurred.

At each reporting date, the Group and the Company assess whether there is any indication
of impairment. Where an indication of impairment exists, the carrying value of the investment
property is assessed and written down immediately to its recoverable amount. See accounting
policy 2.13 on impairment of non-financial assets.

Investment properties are derecognised upon disposal or when they are permanently withdrawn
from use and no future economic benefits are expected from their disposal. On disposal, the
difference between the net disposal proceeds and the carrying amount is recognised in profit or
loss.

Transfers are made to or from investment property only when there is a change in use.
Transfers from investment property to owner-occupied property are made at the carrying
amount as at the date of change in use. For a transfer from owner-occupied property to
investment property, the property is accounted for in accordance with the accounting policy for
property, plant and equipment as set out in accounting policy 2.7 up to the date of change in
use.

178 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.9 Investment properties (continued)

(b) Depreciation

Freehold land is not depreciated. Freehold and leasehold buildings are depreciated over the
shorter of their estimated useful lives of 50 years or lease term.

Depreciation is calculated to write off the depreciable amount of other investment properties on
a straight line basis over their estimated useful lives. Depreciation amount is determined after
deducting the residual value from the cost of the investment properties.

The residual values, useful lives and depreciation methods are reviewed, and adjusted if
appropriate, at the end of each financial year.

2.10 Intangible assets

Intangible assets acquired separately are measured initially at cost. The cost of intangible assets
acquired in a business combination is their fair value as at the date of acquisition. Following
initial acquisition, intangible assets are measured at cost less any accumulated amortisation and
accumulated impairment losses.

Intangible assets with finite useful lives are amortised over the estimated useful lives and assessed
for impairment whenever there is an indication that the intangible asset may be impaired. See
accounting policy 2.13 on impairment of non-financial assets. The amortisation period and the
amortisation method are reviewed at least at each financial year end. Changes in the expected
useful life or the expected pattern of consumption of future economic benefits embodied in the
asset is accounted for by changing the amortisation period or method, as appropriate, and are
treated as changes in accounting estimates. The amortisation expense on intangible assets with
finite lives is recognised in profit or loss.

Intangible assets with indefinite useful lives or not yet available for use are tested for impairment
annually, or more frequently if the events and circumstances indicate that the carrying value may
be impaired either individually or at the cash-generating unit level. See accounting policy 2.13 on
impairment of non-financial assets. Such intangible assets are not amortised. The useful life of an
intangible asset with an indefinite useful life is reviewed annually to determine whether the useful
life assessment continues to be supportable. If not, the change in useful life from indefinite to finite
is made on a prospective basis.

Gains or losses arising from derecognition of an intangible asset are measured as the difference
between the net disposal proceeds and the carrying amount of the asset and are recognised in
profit or loss when the asset is derecognised.

(a) Goodwill

Goodwill represents the excess of the cost of acquisition of subsidiaries, joint ventures and
associates over the fair value of the Group’s share of the identifiable net assets at the date of
acquisition.

Goodwill on acquisition of subsidiaries is tested annually for impairment and carried at cost
less accumulated impairment losses. Impairment losses on goodwill are not reversed. Gains
and losses on the disposal of an entity include the carrying amount of goodwill relating to the
entity sold.

Goodwill on acquisition of subsidiaries is allocated to cash-generating units for the purpose of

impairment testing. The allocation is made to those cash-generating units or groups of cash-
generating units that are expected to benefit from the synergies of the business combination
in which the goodwill arose.

Goodwill on acquisitions of joint ventures and associates is included in the carrying amounts
of investments in joint ventures and associates respectively. Such goodwill is tested for
impairment as part of the overall balance.

Wasco Berhad 179

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.10 Intangible assets (continued)

(a) Goodwill (continued)

Where goodwill forms part of a cash-generating unit and part of the operation within that
cash-generating unit is disposed off, the goodwill associated with the operation disposed off is
included in the carrying amount of the operation when determining the gain or loss on disposal
of the operation. Goodwill disposed off in this circumstance is measured based on the relative
fair values of the operations disposed off and the portion of the cash-generating unit retained.

(b) Trademarks

Separately acquired trademarks are shown at historical cost. Trademarks acquired in a

business combination are recognised at fair value at the acquisition date. Trademarks have an
infinite useful life and are carried at cost less accumulated impairment.

(c) Technical know-how

Separately acquired technical know-how is shown at historical costs. Technical know-how

acquired in a business combination is recognised at fair value at the acquisition date. Technical
know-how has a finite useful life and is carried at cost less accumulated amortisation.
Amortisation is calculated using the straight line method to allocate the cost of technical
know-how over its estimated useful lives of 5 years.

(d) Intellectual property

Expenditure on acquired intellectual property is capitalised and amortised using the straight
line method over their estimated useful life, not exceeding a period of 20 years.

2.11 Inventories

Inventories are stated at the lower of cost and net realisable value. Cost is determined on the first
in, first out basis. In the case of finished goods and work in progress, cost comprises materials,
direct labour, other direct charges and an appropriate proportion of factory overheads.

Net realisable value is the estimated selling price in the ordinary course of business less the
estimated costs to completion and selling expenses.

Where necessary, allowance is provided for damaged, obsolete and slow moving items to adjust the
carrying value of inventories to the lower of cost and net realisable value.

2.12 Cash and cash equivalents

Cash and cash equivalents comprise cash on hand, deposits held at call with financial institutions,
other short term, highly liquid investments with original maturities of 3 months or less that are
readily convertible to known amounts of cash and which are subject to insignificant risk of changes
in value. For the purpose of the statements of cash flows, cash and cash equivalents are presented
net of bank overdrafts and exclude fixed deposits pledged to secure banking facilities.

2.13 Impairment of non-financial assets

Assets that have an indefinite useful life, for example goodwill or intangible assets not ready to use,
are not subject to amortisation or depreciation and are tested annually for impairment. The Group
also assesses goodwill, intangible assets with indefinite useful life and other assets that are subject
to amortisation or depreciation for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An impairment loss is recognised for
the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable
amount is the higher of an asset’s fair value less costs to sell and value-in-use. For the purpose
of assessing impairment, assets are grouped at the lowest levels for which there are separately
identifiable cash flows (cash-generating units). Non-financial assets other than goodwill that
suffered impairment are reviewed for possible reversal of the impairment at each reporting date.
Impairment losses are recognised in profit or loss within ‘impairment of assets’.

180 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.14 Provision for warranties

Provisions are recognised when the Group has a present legal or constructive obligation as a result
of past events; it is probable that an outflow of resources will be required to settle the obligation;
and a reliable estimate of the amount can be made. Provisions are not recognised for future
operating losses.

The Group recognises the estimated liability to repair or replace products when the underlying
products or services are sold. The provision is calculated based on historical warranty data and
specific circumstances related to products or services sold, after considering the various possible
outcomes against their associated probabilities.

2.15 Share capital

(a) Issue of shares

Ordinary shares are classified as equity. Other shares are classified as equity and/or liability
according to the economic substance of the particular instrument.

(b) Dividend distribution

Dividend distribution to owners of the Company is debited directly to equity and the
corresponding liability is recognised in the period in which the dividends are approved.

Liability is recognised for the amount of any dividend declared, being appropriately authorised
and no longer at the discretion of the Group, on or before the end of the reporting period but
not distributed at the end of the reporting period.

(c) Treasury shares

When share capital recognised as equity is repurchased, the amount of the consideration paid,
including directly attributable costs, is recognised as a deduction from equity. Repurchased
shares that are not subsequently cancelled are classified as treasury shares and are
presented as a deduction from equity attributable to owners of the Company. No gain or loss
is recognised in profit or loss on the purchase, sale, issue or cancellation of treasury shares.
When treasury shares are reissued by resale, any consideration received, net of any directly
attributable incremental transaction costs and the related income tax effects, is included in
equity attributable to owners of the Company.

An amount equivalent to the original purchase cost of the treasury shares will be deducted
from retained earnings upon the distribution of any treasury shares as share dividends.

2.16 Foreign currencies

(a) Functional and presentation currencies

The financial statements of each entity within the Group are measured using the currency
of the primary economic environment in which the respective entity operates (“the functional
currency”). The financial statements are presented in Ringgit Malaysia (“RM”), which is the
Company’s functional and presentation currency.

(b) Transactions and balances

Transactions in foreign currencies are translated into the functional currency at the rate of
exchange ruling at the dates of the transactions.

Monetary items denominated in foreign currencies at the reporting date are translated at the
foreign currency exchange rates ruling at that date.

Wasco Berhad 181

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.16 Foreign currencies (continued)

(b) Transactions and balances (continued)

Non-monetary items which are measured in terms of historical costs denominated in foreign
currencies are translated at the foreign currency exchange rates ruling at the date of the
transaction.

Foreign exchange gains and losses arising on the settlement of monetary items and the
translation of monetary assets and liabilities denominated in foreign currencies are recognised
in the profit or loss, except when deferred in other comprehensive income as qualifying cash
flow hedges.

When a gain or loss on a non-monetary item is recognised in the profit or loss, any
corresponding exchange gain or loss is recognised in profit or loss. When a gain or loss on a
non-monetary item is recognised directly in other comprehensive income, any corresponding
exchange gain or loss is recognised directly in other comprehensive income.

(c) Translation of foreign operations

On consolidation, all assets and liabilities of foreign operations that have a functional
currency other than Ringgit Malaysia, including goodwill and fair value adjustments arising on
acquisition, are translated at the exchange rates ruling at the reporting date.

Income and expense items are translated at average exchange rates.

All exchange differences arising from the translation of the financial statements of foreign
operations are taken to other comprehensive income. Upon disposal of a foreign operation, the
exchange translation differences relating to those foreign operations that were recorded within
other comprehensive income are recognised in the profit or loss as part of the gain or loss on
disposal.

In the case of a partial disposal that does not result in the Group losing control over a foreign
operation, the proportionate share of accumulated exchange differences based on effective
equity interest are re-attributed to non-controlling interests and are not recognised in profit or
loss.

2.17 Financial assets

(a) Classification

The Group and the Company classify its financial assets in the following measurement
categories: at fair value through profit or loss and at amortised cost. The classification
depends on the nature of the entity’s business model for managing the financial assets and the
contractual terms of the cash flows.

The Group and the Company reclassify debt investments when and only when its business
model for managing those assets changes.

(b) Recognition and initial measurement

Regular way purchases and sales of financial assets are recognised on the trade date. The
trade date refers to the date on which the Group and the Company commit to purchase or sell
the asset.

Financial assets are initially recognised at fair value plus transaction cost that are directly
attributable to the acquisition of the financial assets except for financial assets at fair value
through profit or loss. Transaction costs for financial assets measured at fair value through
profit or loss are recognised immediately as expenses within profit or loss.

182 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.17 Financial assets (continued)

(c) Subsequent measurement

(i) Debt instruments at amortised cost

After initial recognition, financial assets that are held for collection of contractual cash
flows where those cash flows represent solely payment of principal and interest are
measured at amortised cost using the effective interest method. Any gain or loss arising
on derecognition is recognised directly in profit or loss. Impairment losses are recognised
in profit or loss.

(ii) Debt instruments at fair value through profit or loss

Subsequent to initial recognition, financial assets that do not meet the criteria for
amortised cost or fair value through other comprehensive income are measured at fair
value through profit or loss. Any gains or losses arising from changes in fair value are
recognised in profit or loss within ‘other gains/(losses) - net’. Exchange differences,
interest and dividend income on financial assets at fair value through profit or loss are
recognised separately in profit or loss.

(iii) Equity instruments

The Group and the Company subsequently measure all equity investments at fair
value. Where the Group’s and the Company’s management have elected to present fair
value gains and losses on equity investments in other comprehensive income, there is
no subsequent reclassification of fair value gains and losses to profit or loss following
the derecognition of the investment. Dividends from such investments continue to be
recognised in profit or loss as other income when the Group’s and the Company’s right to
receive payments is established. Changes in the fair value of financial assets at fair value
through profit or loss are recognised in profit or loss within ‘other gains/(losses) - net’.

(d) Impairment of financial assets

The Group and the Company assess on a forward-looking basis the expected credit loss
(“ECL”) associated with the debt instruments carried at amortised cost. The impairment
methodology applied depends on whether there has been a significant increase in credit risk.

The financial assets of the Group and the Company that are subject to the ECL model are
trade and other receivables, contract assets, lease receivables, loans to subsidiaries and
amounts owing from associates and joint ventures. While cash and cash equivalents are also
subject to the impairment requirements of MFRS 9, the impairment loss is immaterial.

ECL represents a probability-weighted estimate of the difference between present value of

cash flows according to contract and present value of cash flows the Group and the Company
expect to receive, over the remaining life of the financial instrument.

The measurement of ECL reflects:

• an unbiased and probability-weighted amount that is determined by evaluating a range of

possible outcomes;
• the time value of money; and
• reasonable and supportable information that is available without undue cost or effort at
the reporting date about past events, current conditions and forecasts of future economic
conditions.

Wasco Berhad 183

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.17 Financial assets (continued)

(d) Impairment of financial assets (continued)

(i) General 3-stage approach for other receivables, loans to subsidiaries and financial
guarantee contracts

At each reporting date, the Group and the Company measure ECL through loss allowance
at an amount equal to 12 month ECL if credit risk on a financial instrument or a group of
financial instruments has not increased significantly since initial recognition. For all other
financial instruments, a loss allowance at an amount equal to lifetime ECL is required.

The Group and the Company consider the probability of default upon initial recognition
of financial asset and whether there has been a significant increase in credit risk on an
ongoing basis throughout each reporting period. To assess whether there is a significant
increase in credit risk, the Group and the Company compare the risk of a default
occurring on the financial asset as at the reporting date with the risk of default as at
the date of initial recognition. Available, reasonable and supportable forward-looking
information are also considered.

The Group and the Company define a financial instrument as default, which is fully
aligned with the definition of credit-impaired, when it meets one or more of the following
criteria:

• when the counterparty fails to make contractual payment as they fall due
• the debtor is in breach of financial covenants
• concessions have been made by the lender relating to the debtor’s financial
difficulty
• it is becoming probable that the debtor will enter bankruptcy or other financial
reorganisation
• the debtor is insolvent

Financial instruments have been grouped based on shared credit risk characteristics and
the days past due in measuring ECL.

Financial instruments that are credit-impaired are assessed on individual basis.

(ii) Simplified approach for trade receivables, contract assets and lease receivables

The Group and the Company apply the MFRS 9 simplified approach to measure ECL
which uses a lifetime ECL for all trade receivables, contract assets and lease receivables.
Individual assessment is made to these financial assets which are in default or credit-
impaired.

(e) Write-off

Financial assets are written off when the Group and the Company have exhausted all practical
recovery efforts and have concluded that there is no reasonable expectation of recovery.
Indicator of no reasonable expectation of recovery include failure of a debtor to engage in a
repayment plan with the Group and the Company. The Group and the Company may write-off
financial assets that are still subject to enforcement activity.

Impairment losses are presented as net impairment losses within ‘impairment of financial
assets’. Write-offs are recognised in profit or loss within ‘administrative and general expenses’.
Subsequent recoveries of amounts previously written off are credited against the same line
item.

(f) De-recognition

Financial assets are derecognised when the rights to receive cash flows from the financial
assets have expired or have been transferred and the Group and the Company have
transferred substantially all the risks and rewards of ownership.

184 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.18 Financial liabilities

(a) Classification

Financial liabilities are classified according to the substance of the contractual arrangements
entered into and the definitions of a financial liability.

(i) Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for
trading and financial liabilities designated upon initial recognition as at fair value through
profit or loss. Financial liabilities held for trading include derivatives entered into by the
Group and the Company that do not meet the hedge accounting criteria. Liabilities in this
category are classified within current liabilities if they are either held for trading or are
expected to be settled within 12 months after the reporting date. Otherwise, they are
classified as non-current.

(ii) Other financial liabilities

The Group’s and the Company’s other financial liabilities include trade payables, other
payables, intercompany payables, dividend payable and loans and borrowings. Loans and
borrowings are classified as current liabilities unless the Group and the Company have
an unconditional right to defer settlement of the liability for at least 12 months after the
reporting date.

(b) Recognition and de-recognition

A financial liability is recognised when, and only when, the Group or the Company becomes a
party to the contractual provisions of the financial instrument.

A financial liability is derecognised when the obligation under the liability is extinguished.
When an existing financial liability is replaced by another from the same lender on
substantially different terms, or the terms of an existing liability are substantially modified,
such an exchange or modification is treated as a de-recognition of the original liability and
the recognition of a new liability, and the difference in the respective carrying amounts is
recognised in profit or loss.

(c) Initial and subsequent measurement

Derivative financial liabilities are initially measured at fair value and subsequently stated at fair
value, with any resulting gains or losses recognised in profit or loss. Net gains or losses on the
derivatives include exchange differences.

Trade and other payables are recognised initially at fair value net off directly attributable
transaction costs and subsequently measured at amortised cost using the effective interest
method.

Loans and borrowings are recognised initially at fair value, net of transaction costs incurred,
and subsequently measured at amortised cost using the effective interest method.

For other financial liabilities, gains and losses are recognised in profit or loss when the
liabilities are de-recognised.

2.19 Offsetting financial instruments

Financial assets and financial liabilities are offset and the net amount reported in the statement
of financial position when there is a legally enforceable right to offset the recognised amounts
and there is an intention to settle on a net basis, or to realise the asset and settle the liability
simultaneously. The legally enforceable rights must not be contingent on future events and must be
enforceable in the normal cause of business and in the event of default, insolvency or bankruptcy.

Wasco Berhad 185

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.20 Derivative financial instruments

A derivative financial instrument is initially recognised at its fair value on the date the contract is
entered into and is subsequently carried at its fair value. The method of recognising the resulting
gain or loss depends on whether the derivative is designated as a hedging instrument, and if
so, the nature of the item being hedged. Gains or losses on derivatives that are not designated
as a hedging instrument are recognised in profit or loss within ‘other gains/(losses) - net’. Whilst
the derivatives are used for hedging activities, the Group and the Company do not apply hedge
accounting.

2.21 Financial guarantee contracts

A financial guarantee contract is a contract that requires the issuer to make specified payments to
reimburse the holder for a loss it incurs because a specified debtor fails to make payment when
due.

The Company has issued corporate guarantees to banks for borrowings of certain subsidiaries.
These guarantees are financial guarantees as they require the Company to reimburse the banks if
the subsidiaries fail to make principal or interest payments when due in accordance with the terms
of their borrowings.

Financial guarantee contracts are recognised initially as a liability at fair value. Subsequent to
initial recognition, the liability is measured at the higher of the amount determined in accordance
with the ECL model under MFRS 9 ‘Financial Instruments’ and the amount initially recognised less
cumulative amount of income recognised in accordance with the principles of MFRS 15 ‘Revenue
from Contracts with Customers’, where appropriate.

2.22 Revenue recognition

(a) Revenue from contracts with customers

Revenue from contracts with customers is recognised by reference to each distinct

performance obligation in the contract with customer. Revenue from contracts with customers
is measured at its transaction price, being the amount of consideration which the Group
expects to be entitled in exchange for transferring promised goods or services to a customer,
net of goods and service tax, returns, rebates and discounts. Transaction price is allocated
to each performance obligation on the basis of the relative standalone selling prices of
each distinct good or services promised in the contract. Depending on the substance of the
contract, revenue is recognised when the performance obligation is satisfied, which may be at
a point in time or over time.

Contract asset is the right to consideration for goods or services transferred to the customers.
Where the cumulative revenue earned exceed progress billings, the balance is presented as
‘contract assets’ within current assets.

Contract liability is the obligation to transfer goods or services to customer for which the
Group has received the consideration or has billed the customer. Where progress billings
exceed the cumulative revenue earned, the balance is presented as ‘contract liabilities’ within
current liabilities.

186 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.22 Revenue recognition (continued)

(a) Revenue from contracts with customers (continued)

Specific revenue recognition criteria for each of the Group’s activities are as described below:

(i) Contract revenue

Contract revenue with customers include contracts relating to pipe coating,

manufacturing of boilers and steam turbines as well as engineering and fabrication
services.

These contracts may include multiple performance obligations as they are not highly
integrated. Hence, the transaction price will be allocated to each performance obligation
based on the standalone selling price.

Where the contracts are highly integrated, they are recognised as a single performance
obligation. Revenue is recognised progressively based on the progress towards complete
satisfaction of the performance obligation.

Revenue are recognised over time when control of the asset is transferred over time
when the Group’s performance:

• creates and enhances an asset that the customer controls as the services are being
performed; or
• does not create an asset with an alternative use to the Group and the Group has an
enforceable right to payment for performance completed to date.

The progress towards complete satisfaction of the performance obligation is measured

based on one of the following methods that best reflect the Group’s performance in
satisfying the performance obligation:

• direct measurements of the value transferred by the Group to the customer (eg.
surveys of performance completed to date); or
• the Group’s efforts or inputs to the satisfaction of the performance obligation (eg. by
reference to cost incurred up to the end of the reporting period as a percentage of
total estimated costs for complete satisfaction of the contract).

(ii) Sales of goods

The Group manufactures and sells a range of pipes for industrial use. The Group is also
involved in the business of selling building materials, construction equipment, and power
generators.

Revenue from sales of goods are recognised at a point in time when control of the good
is transferred to the customer upon delivery.

(iii) Management fee

Management fee is recognised on an accrual basis when service is rendered.

(b) Revenue from other sources

(i) Rental income

Rental income is recognised on a straight line basis over the lease term.

(ii) Dividend income

Dividend income is recognised when the right to receive payment is established.

(iii) Interest income

Interest income is recognised on a time proportion basis, taking into account the principal
outstanding and the effective interest rate applicable.

Wasco Berhad 187

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.23 Borrowing costs

Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly
attributable to the acquisition, construction or production of that asset. Capitalisation of borrowing
costs commences when the activities to prepare the asset for its intended use or sale are in
progress and the expenditure and borrowing costs are incurred. Capitalisation of borrowing costs is
suspended or ceased when substantially all the activities necessary to prepare the qualifying asset
for its intended use or sale are interrupted or completed.

All other borrowing costs are recognised in profit or loss using the effective interest method in the
period they are incurred. Borrowing costs consist of interest and other costs that the Group and the
Company incurred in connection with the borrowing of funds.

2.24 Income taxes

(a) Current tax

Current tax expense is determined according to the tax laws of each jurisdiction in which the
Group and the Company operate and include all taxes based upon the taxable profits after
taking into consideration available tax incentives.

Current taxes are recognised in profit or loss except to the extent that the tax relates to items
recognised outside profit or loss, either in other comprehensive income or directly in equity.

(b) Deferred tax

Deferred tax is recognised in full, using the liability method, on temporary differences at the
reporting date between the tax bases of assets and liabilities and their carrying amounts in
the financial statements. Deferred tax liabilities are recognised for all taxable temporary
differences. Deferred tax assets are recognised for all deductible temporary differences to the
extent that it is probable that taxable profits will be available against which the deductible
temporary differences or unused tax losses can be utilised.

Deferred tax is not recognised if the temporary difference arises from goodwill or from the
initial recognition of an asset or liability in a transaction which is not a business combination
and, at the time of the transaction, affects neither accounting profit nor taxable profit.

Deferred tax is recognised on temporary differences arising on investments in subsidiaries,

associates and joint ventures, except where the timing of the reversal of the temporary
difference can be controlled by the Group and it is probable that the temporary difference
will not reverse in the foreseeable future. Generally the Group is unable to control the reversal
of the temporary difference for associates. Only where there is an agreement in place that
gives the Group the ability to control the reversal of the temporary difference, the deferred tax
liability is not recognised.

Deferred tax assets on any unutilised portion of tax incentives are recognised to the extent
that it is probable that future taxable profits will be available against which the unutilised tax
incentives can be utilised.

The initial recognition exemption in MFRS 112 ‘Income Taxes’ is applied on the temporary
differences related to the right-of-use asset and lease liability. The Group does not recognise
any deferred tax asset or liability arising from a lease contract.

188 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.24 Income taxes (continued)

(b) Deferred tax (continued)

Deferred tax is measured at the tax rates that are expected to apply to the period when
the asset is realised or the liability is settled, based on tax rates that have been enacted or
substantively enacted at the reporting date.

Deferred tax is recognised in the profit or loss, except when it arises from a transaction which
is recognised directly in equity, in which case the deferred tax is also charged or credited
directly to equity, or when it arises from a business combination that is an acquisition, in which
case the deferred tax is included in the resulting goodwill.

Deferred tax assets and liabilities are offset when the enterprise has a legally enforceable right
to offset and intends to settle either on a net basis or to realise the asset and settle the liability
simultaneously.

2.25 Employee benefits

(a) Short term benefits

Salaries, wages, bonuses and social security contributions are recognised as an expense in
the financial year in which the services are rendered by employees. Short term accumulating
compensated absences such as paid annual leave are recognised when services are rendered
by employees that increase their entitlements to future compensated absences, and short
term non-accumulating compensated absences such as sick leave are recognised when the
absences occur. Non-monetary benefits such as medical care, housing and other staff related
expenses are charged to the profit or loss as and when incurred.

(b) Post-employment benefits

The Group has post-employment benefit schemes in accordance with local conditions and
practices in the countries in which it operates. These post-employment benefit schemes are
defined contribution plans.

A defined contribution plan is a pension plan under which the Group pays fixed contributions
into a separate entity (a fund) and will have no legal or constructive obligations to pay further
contributions if the fund does not hold sufficient assets to pay all employee benefits relating to
employee services in the current and prior periods.

As required by law, the Company and its subsidiaries in Malaysia make contributions to the
Employees Provident Fund (“EPF”) which is a defined contribution plan, whereas subsidiaries in
other countries make their respective local contributions, if required by law.

Such contributions are recognised as an expense in the profit or loss in the financial year to
which they relate.

2.26 Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the
chief operating decision-maker. The Group Chief Executive Officer has been identified as the chief
operating decision-maker as he is responsible for allocating resources and assessing performance
of the Group’s operating segments.

Wasco Berhad 189

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

2 MATERIAL ACCOUNTING POLICIES (CONTINUED)

2.27 Assets classified as held for sale

Assets classified as held for sale are classified as assets/liabilities held for sale of the carrying
amount is to be recovered principally through a sale transaction and a sale is considered highly
probable. They are stated at the lower of carrying amount and fair value less costs to sell. Property,
plant and equipment, right-of-use assets and intangible assets once classified as held for sale are
not depreciated or amortised.

An impairment loss is recognised for any initial or subsequent write-down of the asset to fair value
less costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of
an asset, but not in excess of any cumulative impairment loss previously recognised. A gain or loss
not previously recognised by the date of the sale of the non-current asset is recognised at the date
of derecognition.

2.28 Contingent liabilities

The Group and the Company do not recognise a contingent liability but discloses its existence in
the financial statements. A contingent liability is a possible obligation that arises from past events
whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain
future events beyond the control of the Group and the Company or a present obligation that is not
recognised because it is not probable that an outflow of resources will be required to settle the
obligation. A contingent liability also arises in the extremely rare case where there is a liability that
cannot be recognised because it cannot be measured reliably.

Contingent liability is not recognised on the statement of financial position of the Group, except for
contingent liability assumed in a business combination that is a present obligation and which the fair
values can be reliably determined.

3 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated by the Directors and are based on historical
experience and other factors, including expectations of future events that are believed to be reasonable
under the current circumstances.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates
will, by definition, rarely equal the related actual results. The estimates and assumptions that have a
significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the
next financial year are outlined below.

(a) Impairment of goodwill

The Group tests goodwill for impairment annually in accordance with the accounting policy 2.10(a)
and whenever events or changes in circumstances indicate that the goodwill may be impaired.
For the purposes of assessing impairment, goodwill is allocated to cash-generating units that are
expected to benefit from the synergies of the business combination in which the goodwill arose.
The estimation of the present value of future cash flows generated by the cash-generating units or
groups of cash-generating units are based on management’s judgement of the developments in the
market and the expected future performance, taking into account the impact of the uncertainty of the
future economic condition.

190 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

3 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED)

(a) Impairment of goodwill (continued)

These discounted cash flow calculations use five-year projections that are based on financial
forecast. Cash flow projections take into account past experience and represent management’s
best estimate about future developments. Cash flows after the five-year period are extrapolated
to perpetuity using terminal growth rates. Key assumptions on which management has based its
determination of recoverable value include estimated revenue amount and weighted average cost of
capital adjusted for specific risks associated with the cash-generating units. Due to the uncertainty
of the future economic condition, management developed the base case and worst case scenario
of cash flow projections. Probabilities of occurrence were assigned to each scenario to arrive at a
single set of cash flow projection. The assumptions used in both scenarios and the probabilities of
occurrence assigned required management’s judgement.

Changes in assumptions could affect the results of the Group’s test for impairment of goodwill.
Further details of the carrying amount and the key assumptions applied in the impairment
assessment of goodwill are given in Note 7.

(b) Impairment of non-financial assets

The Group assesses whether there is any indication that non-financial assets are impaired at the
end of each reporting period. Impairment is measured by comparing the carrying amount of an asset
with its recoverable amount. Recoverable amount is measured at the higher of the fair value less
cost to sell for that asset and its value-in-use. For the purposes of assessing impairment, assets are
grouped at the lowest levels for which there are separately identifiable cash flows which are largely
independent of the cash inflows from other assets or groups of assets (cash-generating units).

For certain plant and equipment, fair value less cost to sell is determined based on estimates
prepared by an independent expert. The fair value is estimated based on comparison of market
transacted price for similar plant and equipment, and where necessary, adjusted for age, usage and
conditions of the plant and equipment and expectation of future market outlook of the industry due
to the uncertainty of the future economic condition.

Details of the carrying amount and the key assumptions applied in the impairment assessment of
property, plant and equipment and investment properties are in Notes 4 and 6. During the financial
year, impairment charge of RM1,847,000 and RM19,000 (2022: RM Nil) was provided to the
property, plant and equipment and investment properties respectively. Refer to Notes 4 and 6 for
further details.

(c) Impairment of investments in associates and joint ventures

The carrying amount of investments in associates and joint ventures are compared to their
recoverable amount. The recoverable amount was determined using their value-in-use. The value-
in-use is the net present value of the projected future cash flows to be derived from that asset.
Projected future cash flows are calculated based on historical sector and industry trends, general
market and economic conditions, changes in technology and other available information. Due to
the uncertainty of the future economic condition, management developed the base case and worst
case scenario of cash flow projections. Probabilities of occurrence were assigned to each scenario
to arrive at a single set of cash flow projection. The assumptions used in both scenarios and the
probabilities of occurrence assigned required management’s judgement.

During the financial year, impairment charge of RM Nil (2022: RM39,537,000) and RM Nil (2022:
RM 8,989,000) was provided to the investment in associate and joint venture respectively. Refer to
Notes 10 and 11 for further details.

Wasco Berhad 191

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

3 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED)

(d) Impairment of financial assets

The Group and the Company assess on a forward-looking basis the expected credit loss (“ECL”)
on financial assets at the end of each reporting period. The loss allowance for financial assets is
determined using the ECL model which includes assumptions on forward-looking information and
their associated impact on probability of default, loss given default and exposure at default.
Management uses judgement in making these assumptions and selecting the inputs to the loss
allowance calculation, based on the Group’s and the Company’s past history, existing market
conditions as well as forward-looking estimates at the end of each reporting period. By varying the
assumptions of the ECL model, multiple scenarios (a range of possible outcomes) were factored
into the computation of the ECL model and the probabilities of occurrence were assigned to each
scenario to arrive at a single loss allowance. The assumptions used in the multiple scenarios and the
probabilities of occurrence assigned required management’s judgement.

(e) Revenue recognised from customers on contracts

Revenue is recognised when or as the control of the asset is transferred to the customers and,
depending on the terms of the contract and the applicable laws governing the contract, control of the
asset may transfer over time or at a point in time. If control of the asset transfers over time, revenue
is recognised over the period of the contract by reference to the progress, based on the extent of
contract costs incurred.

Significant judgement is required in the estimation of the progress towards complete satisfaction of
a performance obligation based on the extent of contract costs incurred over the estimated budget
cost and the recoverability of the construction contracts. The estimated contract costs to completion
is based on estimated and approved budgets, which require assessment and judgements to be made
on changes in, for example, work scope, costs and costs to completion. In making these judgements,
management relies on past experience.

(f) Deferred tax assets

Deferred tax assets are recognised for all unused tax losses, unabsorbed capital allowances and
other deductible temporary differences to the extent that it is probable that taxable profit will be
available against which the tax losses, capital allowances and other deductible temporary differences
can be utilised. Significant judgement is required to determine the amount of deferred tax assets that
can be recognised, based upon the likely timing and level of future taxable profits. Assumptions about
generation of future taxable profits depend on the Group’s estimate of projected future cash flows.
These judgements and assumptions are subject to risks and uncertainty, hence there is a possibility
that changes in circumstances will alter expectations, which may impact the amount of deferred
tax assets recognised in the statements of financial position and the amount of unused tax losses,
unabsorbed capital allowances and unutilised temporary differences that remain unrecognised.
Deferred tax assets is disclosed in Note 8.

192 Integrated Annual Report 2023

 4 PROPERTY, PLANT AND EQUIPMENT

Electrical
installations,
computer Renovation,

Wasco Berhad
Plant, and office yard
Freehold machinery, equipment, development Capital
land and tools and furniture Motor and store work in
buildings Buildings equipment and fittings vehicles extension progress Total
Group RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

2023

Cost

At 1 January 142,976 260,754 1,184,828 108,569 15,749 79,622 87,510 1,880,008

Additions 344 - 51,357 9,904 1,172 32,604 32,152 127,533
Disposals (2,426) - (9,539) (144) (1,320) - - (13,429)
Write-offs - - (620) (4,015) - (446) (20,370) (25,451)
Reclassification 169 - (3,858) 6,157 - - (2,468) -
Transfer from right-of-use assets - 12,684 982 - - - - 13,846
Transfer from inventories - - 14,005 - - - - 14,005
Transfer to assets held for sale (15,695) (4,108) - - - - - (19,803)
Disposal of subsidiary - - - (138) - - - (138)
Transfer to assets of disposal group
classified as held for sale - - (376) (2,504) (1,909) (1,111) - (5,900)
Effect of exchange rate changes 135 8,829 46,162 3,000 176 4,897 3,571 66,770

At 31 December 125,503 278,339 1,282,941 120,829 13,868 115,566 100,395 2,037,441

193
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023
Notes to the Financial Statements
 4 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

194
Electrical
installations,
computer Renovation,
Plant, and office yard
Freehold machinery, equipment, development Capital
land and tools and furniture Motor and store work in
buildings Buildings equipment and fittings vehicles extension progress Total
Group RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

2023

Accumulated depreciation and

impairment loss

At 1 January 15,405 163,834 1,027,806 96,766 14,533 68,611 19,717 1,406,672

Depreciation charge for the financial year 1,666 5,834 38,488 7,692 607 1,908 - 56,195
Impairment loss for the financial year - - 1,847 - - - - 1,847
Disposals - - (9,454) (122) (1,319) - - (10,895)
Write-offs - - (614) (3,934) - (396) (20,370) 25,314
Reclassification - - (72) 72 - - - -
Transfer from right-of-use assets - 50 16 - - - - 66
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Transfer to inventories - - (582) - - - - (582)

Transfer to assets held for sale (1,435) (1,894) - - - - - (3,329)
Notes to the Financial Statements

Disposal of subsidiary - - - (66) - - - (66)

Transfer to assets of disposal group
classified as held for sale - - (224) (2,213) (1,720) (1,041) - (5,198)
Effect of exchange rate changes - 6,770 40,291 2,590 179 4,142 653 54,625

At 31 December 15,636 174,594 1,097,502 100,785 12,280 73,224 - 1,474,021

Carrying amount at 31 December 109,867 103,745 185,439 20,044 1,588 42,342 100,395 563,420

Integrated Annual Report 2023

 4 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

Electrical
installations,
computer Renovation,

Wasco Berhad
Plant, and office yard
Freehold machinery, equipment, development Capital
land and tools and furniture Motor and store work in
buildings Buildings equipment and fittings vehicles extension progress Total
Group RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

2022

Cost

At 1 January 143,586 207,035 1,099,857 90,083 16,229 68,795 124,119 1,749,704

Additions 50 21 13,908 5,895 475 7,742 8,554 36,645
Disposals (700) - (14,288) (359) (726) - (31) (16,104)
Write-offs - (9) (1,743) (979) - (245) (39) (3,015)
Reclassification - (7) 45,659 - - 2,203 (47,855) -
Transfer to investment properties - (5,567) - - - - - (5,567)
Transfer from/(to) inventories - - 7,554 - - - (4,099) 3,455
Transfer from assets held for sale - 52,416 966 11,394 - - - 64,776
Acquisition of subsidiary - - - 6 - - - 6
Transfer to assets of disposal group
classified as held for sale - - (394) (91) (415) - - (900)
Effect of exchange rate changes 40 6,865 33,309 2,620 186 1,127 6,861 51,008

At 31 December 142,976 260,754 1,184,828 108,569 15,749 79,622 87,510 1,880,008

195
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023
Notes to the Financial Statements
 4 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

196
Electrical
installations,
computer Renovation,
Plant, and office yard
Freehold machinery, equipment, development Capital
land and tools and furniture Motor and store work in
buildings Buildings equipment and fittings vehicles extension progress Total
Group RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

2022

Accumulated depreciation and

impairment loss

At 1 January 13,784 141,303 977,365 82,739 14,740 66,364 18,635 1,314,930

Depreciation charge for the financial year 1,723 335 32,954 4,696 669 1,406 - 41,783
Disposals (102) - (12,995) (303) (726) - - (14,126)
Write-offs - (2) (300) (968) - (215) - (1,485)
Transfer to investment properties - (1,899) - - - - - (1,899)
Transfer to inventories - - (846) - - - - (846)
Transfer from assets held for sale - 17,838 574 8,246 - - - 26,658
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Acquisition of subsidiary - - - 5 - - - 5
Transfer to assets of disposal group
Notes to the Financial Statements

classified as held for sale - - (375) (43) (343) - - (761)

Effect of exchange rate changes - 6,259 31,429 2,394 193 1,056 1,082 42,413

At 31 December 15,405 163,834 1,027,806 96,766 14,533 68,611 19,717 1,406,672

Carrying amount at 31 December 127,571 96,920 157,022 11,803 1,216 11,011 67,793 473,336

The carrying amount of the Group’s property, plant and equipment amounting to RM14,231,000 (2022: RM261,000) are subject to operating leases as
lessor and are classified under plant, machinery, tools and equipment.

Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

4 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

Renovations,
office
Computer equipment,
and furniture and Motor
Building equipment fittings vehicles Total
Company RM’000 RM’000 RM’000 RM’000 RM’000

2023

Cost

At 1 January 7,288 557 452 708 9,005

Additions - 91 38 - 129
Disposals - (1) (45) (708) (754)
Write-offs - (257) (395) - (652)
Transfer to assets held for sale (7,288) - - - (7,288)

At 31 December - 390 50 - 440

Accumulated depreciation

At 1 January 818 501 341 708 2,368

Depreciation charge for the
financial year 80 37 21 - 138
Disposals - (1) (41) (708) (750)
Write-offs - (257) (307) - (564)
Transfer to assets held for sale (898) - - - (898)

At 31 December - 280 14 - 294

Carrying amount at 31
December - 110 36 - 146

Wasco Berhad 197

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

4 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

Renovations,
office
Computer equipment,
and furniture and Motor
Building equipment fittings vehicles Total
Company RM’000 RM’000 RM’000 RM’000 RM’000

2022

Cost

At 1 January 1,850 828 820 708 4,206

Additions - 49 90 - 139
Reclassification - (4) 4 - -
Transfer from investment
properties 5,438 - - - 5,438
Write-offs - (316) (462) - (778)

At 31 December 7,288 557 452 708 9,005

Accumulated depreciation

At 1 January 187 767 778 708 2,440

Depreciation charge for the
financial year 81 54 21 - 156
Reclassification - (4) 4 - -
Transfer from investment
properties 550 - - - 550
Write-offs - (316) (462) - (778)

At 31 December 818 501 341 708 2,368

Carrying amount at 31
December 6,470 56 111 - 6,637

198 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

5 LEASES

(a) Right-of-use assets

Land and Plant and Motor

Note buildings machineries vehicles Total
Group RM’000 RM’000 RM’000 RM’000

2023

Cost

At 1 January 374,055 2,704 2,129 378,888

Additions 7,863 4,860 787 13,510
Transfer to property, plant and
equipment 4 (12,864) (982) - (13,846)
Transfer to assets of disposal
group classified as held for
sale 22 (4,983) - - (4,983)
Derecognition (3,702) (982) - (3,702)
Effect of exchange rate changes 5,832 261 110 6,203

At 31 December 366,201 6,843 3,026 376,070

Accumulated depreciation

At 1 January 76,388 701 1,896 78,985

Depreciation charge for the
financial year 25,219 1,158 206 26,583
Transfer to property, plant and
equipment 4 (50) (16) - (66)
Transfer to assets of disposal
group classified as held for
sale 22 (4,111) - - (4,111)
Derecognition (3,464) - - (3,464)
Effect of exchange rate changes 1,161 93 55 1,309

At 31 December 95,143 1,936 2,157 99,236

Carrying amount at 31
December 271,058 4,907 869 276,834

Wasco Berhad 199

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

5 LEASES (CONTINUED)

(a) Right-of-use assets (continued)

Land and Plant and Motor

Note buildings machineries vehicles Total
Group RM’000 RM’000 RM’000 RM’000

2022

Cost

At 1 January 334,195 1,765 2,143 338,103

Additions 22,223 - - 22,223
Remeasurement (1,048) - - (1,048)
Transfer to assets held for sale 21 (16,301) - - (16,301)
Derecognition (36,533) - - (36,533)
Acquisition of subsidiary 37 66,583 948 - 67,531
Effect of exchange rate changes 4,936 (9) (14) 4,913

At 31 December 374,055 2,704 2,129 378,888

Accumulated depreciation

At 1 January 73,555 354 1,303 75,212

Depreciation charge for the
financial year 27,591 354 610 28,555
Transfer to assets held for sale 21 (3,661) - - (3,661)
Derecognition (22,742) - - (22,742)
Effect of exchange rate changes 1,645 (7) (17) 1,621

At 31 December 76,388 701 1,896 78,985

Carrying amount at 31
December 297,667 2,003 233 299,903

The title deeds to certain leasehold land of the Group with the carrying amount of approximately
RM18,015,000 (2022: RM18,262,000) have yet to be issued by the relevant authorities.

(b) Lease liabilities

Group
2023 2022
RM’000 RM'000

Total cash outflow for leases for the financial year 33,637 28,328

200 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

6 INVESTMENT PROPERTIES

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Cost

At 1 January 17,907 12,340 19,312 24,750

Transfer from/(to) property, plant and
equipment - 5,567 - (5,438)
Transfer to assets held for sale (4,479) - (19,312) -

At 31 December 13,428 17,907 - 19,312

Accumulated depreciation
and impairment loss

At 1 January 8,861 6,740 2,167 2,505

Depreciation charge for the financial year 195 222 213 212
Impairment charge for the financial year 19 - - -
Transfer from/(to) property, plant and
equipment - 1,899 - (550)
Transfer to assets held for sale (2,059) - (2,380) -

At 31 December 7,016 8,861 - 2,167

Carrying amount at 31 December 6,412 9,046 - 17,145

Fair value 25,000 48,236 - 27,420

The carrying amount of the Group’s and the Company’s investment properties amounting to RM2,386,000
and RM Nil respectively (2022: RM4,939,000 and RM17,145,000) are subject to operating leases as
lessor.

Wasco Berhad 201

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

6 INVESTMENT PROPERTIES (CONTINUED)

Fair value of investment properties is categorised as follows:

Group
Level 1 Level 2 Level 3 Total
RM’000 RM’000 RM’000 RM’000

2023

Land - - 14,164 14,164

Buildings - - 10,836 10,836

- - 25,000 25,000

2022

Land - - 16,158 16,158

Buildings - - 32,078 32,078

- - 48,236 48,236

Company
Level 1 Level 2 Level 3 Total
RM’000 RM’000 RM’000 RM’000

2022

Buildings - - 27,420 27,420

Level 1 fair value is derived from quoted price in active markets for identical investment properties that the
entity can access at the measurement date.

Level 2 fair value is estimated using inputs other than quoted price included within Level 1 that are
observable for the investment properties, either directly or indirectly.

Level 3 fair value is estimated using unobservable inputs for the investment properties. The unobservable
input relates to the price per square feet. The fair value of investment properties were estimated using the
comparison method.

The fair values of the investment properties above were estimated based on valuation by independent
qualified valuers. The basis of the valuation adopted is based on market approach which derived from
market evidence of transacted prices per square feet for similar properties in which the values have been
adjusted for key attributes such as property size, location and date of transaction. During the financial
year, based on the valuation, there was no significant change to the fair value of these properties.

202 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

7 GOODWILL AND OTHER INTANGIBLE ASSETS

Technical Intellectual
Goodwill Trademark know-how property Total
Group RM’000 RM’000 RM’000 RM’000 RM’000

2023

Cost

At 1 January 152,841 291 112 3,568 156,812

Effect of exchange rate
changes 4,939 12 - 134 5,085

At 31 December 157,780 303 112 3,702 161,897

Accumulated amortisation and

impairment loss

At 1 January - - 112 3,568 3,680

Effect of exchange rate
changes - - - 134 134

At 31 December - - 112 3,702 3,814

Carrying amount at 31
December 157,780 303 - - 158,083

2022

Cost

At 1 January 146,062 275 112 3,380 149,829

Effect of exchange rate
changes 6,779 16 - 188 6,983

At 31 December 152,841 291 112 3,568 156,812

Accumulated amortisation and

impairment loss

At 1 January - - 112 3,380 3,492

Effect of exchange rate
changes - - - 188 188

At 31 December - - 112 3,568 3,680

Carrying amount at 31
December 152,841 291 - - 153,132

Wasco Berhad 203

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

7 GOODWILL AND OTHER INTANGIBLE ASSETS (CONTINUED)

Impairment testing of goodwill

Goodwill arising from business combinations has been allocated to the Group’s cash-generating units
(“CGU”) identified according to operating divisions. The carrying amounts of goodwill allocated to the
respective CGUs are as follows:

Group
2023 2022
RM’000 RM’000

Cash-generating units

Specialised Pipe Coating and Corrosion Protection Services (CGU A) 84,612 82,137
EPC, Fabrication and Rental of Gas Compressors and Process Equipment
(CGU B) 73,168 70,704

157,780 152,841

The recoverable amounts of the CGUs are determined based on value-in-use calculations. These
calculations use pre-tax cash flow projections based on financial budgets approved by management
covering a period of 5 years (2022: 5 years) based on past performance and their expectations of the
market development. Terminal value is estimated at the end of the 5-year period.

Value-in-use was determined by discounting the future cash flows generated from the CGUs based on the
following key assumptions on the premise that there will be no material changes in the Group’s principal
activities. The discount rates used reflect the weighted average cost of capital adjusted for specific risks
associated with the CGUs of the Group.

Due to the uncertainty of the future economic condition, management developed the base case and worst
case scenarios of cash flow projections. Probabilities of occurrence were assigned to each scenario to
arrive at a single set of cash flow projection. The assumptions used in both scenarios and the probabilities
of occurrence assigned required management’s judgement.

The key assumptions used in the cash flow projections for CGU A under the best, base and worst case
scenarios and CGU B under the base and worst case scenarios are as follows:

CGU A

(a) The revenue forecast for CGU A is supported by management’s forecasted projects, which is in line
with past performance records, future market outlook and management’s expectation of market
developments. A reduction to the revenue forecast was applied for all three scenario;
(b) Pre-tax discount rate of 14.8% (2022: 19.2%) was applied for all three scenarios, benchmarked
against comparable companies at the date of assessment; and
(c) A terminal growth rate of 1.5% (2022: 1.5%) was applied to the best and base case scenario (2022:
base case scenario) while no terminal growth was applied to the worst case scenario.

CGU B

(a) The revenue forecast for CGU B is supported by management’s expected projects, which is in line
with past performance records, future market outlook and management’s expectation of market
developments. A reduction to the revenue forecast was applied for the worst case scenario;
(b) Pre-tax discount rate of 17.5% (2022: 19.8%) was applied for both scenarios, benchmarked against
comparable companies at the date of assessment; and
(c) No terminal growth rate was applied to both scenarios.

204 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

7 GOODWILL AND OTHER INTANGIBLE ASSETS (CONTINUED)

Sensitivity

CGU A and CGU B

As at 31 December 2023, an increase or decrease of 5% of pre-tax discount rate, with all other inputs
remaining constant, will not result in a material effect on the Group’s impairment charge.

8 DEFERRED TAX ASSETS/(LIABILITIES)

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current
tax assets against current tax liabilities and when the deferred taxes relate to the same tax authority.
The following amounts, determined after appropriate offsetting, are shown in the statements of financial
position:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Deferred tax assets 26,719 50,117 - 4,310

Deferred tax liabilities (8,957) (8,267) (14) -

17,762 41,850 (14) 4,310

At 1 January 41,850 27,941 4,310 3,942

Credited/(Charged) to profit or loss:

- Unused tax losses (19,935) 10,482 - -

- Property, plant and equipment (233) (7) (3) (36)
- Provisions and accruals (1,025) 3,912 (4,321) 404
- Unrealised foreign exchange (1,090) 385 - -
- Others (2,773) (542) - -

(25,056) 14,230 (4,324) 368

Acquisition of subsidiaries - (281) - -
Effect of exchange rate changes 968 (40) - -

At 31 December 17,762 41,850 (14) 4,310

Wasco Berhad 205

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

8 DEFERRED TAX ASSETS/(LIABILITIES) (CONTINUED)

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Subject to income tax

Deferred tax assets (before offsetting)

- Unused tax losses 19,212 38,165 - -
- Property, plant and equipment 250 258 - -
- Provisions and accruals 15,757 16,683 - 4,321
- Unrealised foreign exchange losses 128 244 - -
- Others 10 1,297 - -

35,357 56,647 - 4,321

Offsetting (8,638) (6,530) - (11)

Deferred tax assets (after offsetting) 26,719 50,117 - 4,310

Deferred tax liabilities (before offsetting)

- Property, plant and equipment (10,047) (9,439) (14) (11)
- Unrealised foreign exchange gains (1,102) (150) - -
- Others (6,446) (5,208) - -

(17,595) (14,797) (14) (11)

Offsetting 8,638 6,530 - 11

Deferred tax liabilities (after offsetting) (8,957) (8,267) (14) -

The Group concluded that the deferred tax assets will be recoverable using the estimated future taxable
income of the subsidiaries of the Company. It is estimated that the secured project and unsecured project
with high probabilities of successful award which will contribute to the future taxable income at the
subsidiaries.

The Group did not recognise deferred tax assets arising from the following temporary differences
of certain subsidiaries as it is not probable that future taxable profit will be available against which the
deferred tax assets can be utilised in these subsidiaries.

Group
2023 2022
RM’000 RM’000

Deductible temporary differences on:

- Unused tax losses 95,040 125,995
- Unabsorbed capital allowances 106,609 107,039
- Provisions and accruals 24,490 15,980
- Others 52,387 45,685

278,526 294,699

Deferred tax assets not recognised is based on respective countries tax rate 62,319 66,802

206 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

8 DEFERRED TAX ASSETS/(LIABILITIES) (CONTINUED)

The Group’s accumulated unused tax losses, for which no deferred tax assets were recognised on, can
be carried forward for another 10 consecutive years (2022: 10 consecutive years) of assessment (“YA”)
effective from YA2018.

Group
Expiring in 2023 2022
RM’000 RM’000

Unused tax losses

- YA2018 YA2028 46,003 50,136
- YA2019 YA2029 8,611 21,192
- YA2020 YA2030 4,341 19,803
- YA2021 YA2031 146 5,496
- YA2022 YA2032 8 8
- YA2023 YA2033 9,333 -

68,442 96,635

9 INVESTMENT IN SUBSIDIARIES

Company
2023 2022
RM’000 RM’000

Unquoted shares, at cost 926,190 923,730

Accumulated impairment losses (190,095) (186,306)

736,095 737,424

The movements in the allowance for impairment losses of investment in subsidiaries during the financial
year are as follows:

Company
2023 2022
RM’000 RM’000

At 1 January 186,306 181,650

Impairment loss recognised 3,789 4,656

190,095 186,306

For the financial year ended 31 December 2023, due to the uncertainty of the future economic condition,
the investment in certain subsidiaries of the Company was not expected to be recovered. The recoverable
amount was RM771,000 (2022: RM2,009,000), determined through the higher of value in use or fair value
less cost to sell. As a result, an impairment loss of RM3,789,000 (2022: RM4,656,000) was recognised in
the profit and loss.

Wasco Berhad 207

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Details of subsidiaries are as follows:

Group’s effective
interest
2023 2022 Country of
% % incorporation Principal activities

Wasco Energy Ltd. 100 100 Bermuda Investment holding

Wasco Management Services 100 100 Malaysia Provision of management support

Sdn. Bhd. services

Wasco Capital Pte. Limited - -c Singapore Investment and management of

treasury activities

~ Wasco (Australia) Pty. Ltd. 60 60 Australia Provision of construction services

for the oil and gas industry

#
Wasco Coatings Limited 100 100 Hong Kong, Investment holding
SAR

* Wasco Coatings UK Ltd. 100 100 England and Investment holding

Wales

* Wasco Coatings Singapore 100 100 Singapore Investment holding

Pte. Ltd.

~ Turn Key Pipeline 100 100 The Netherlands Provision of engineering design,
Services B.V. construction, installation services
and supply of equipment for pipe
coating plant and facilities for the
oil and gas industry

Wasco Infra Services -i 91 Malaysia Engineering, procurement and

Sdn. Bhd. construction of onshore and near
shore of hydrocarbon, water and
slurry pipelines and associated
facilities

* Eco Consortium Sdn. Bhd. -i 86 Malaysia Dormant

* Wasco Coatings Middle East 60 60 State of Qatar Provision of anti-corrosion

QFZ LLC and concrete weight coating
of pipelines to the oil and gas
industry

Wasco Coatings Services 100 100 Malaysia Provision of pipe coating and
Sdn. Bhd. related services to the oil and
gas industry

#
Wasco Coatings Norway AS -g 100 Norway Dormant

* Wasco Coatings Europe B.V. 100 100 The Netherlands Provision of pipe coating and
related services to the oil and
gas industry

208 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Details of subsidiaries are as follows (continued):

Group’s effective
interest
2023 2022 Country of
% % incorporation Principal activities

#
Wasco Coatings Germany 100 100 Germany Provision of pipe coating and
GmbH related services to the oil & gas
industry

#
Wasco Coatings Germany 100 100 Germany Dormant
(Plant and Equipment)
GmbH

#
Wasco Coatings Finland Oy -h 100 Finland Dormant

#
Wasco ISOAF S.R.L 75p 50p Italy Provision of line pipe thermal
insulation services

#
Wasco ISOAF Tz Limited 56p 38p, p Tanzania Provision of pipe coating, fuel,
gas and gas cylinder

PPSC Industrial Holdings 100 100 Malaysia Investment holding

Sdn. Bhd.

Wasco Resources Sdn. Bhd. 100 100 Malaysia Property investment holding

Wasco Coatings Malaysia 70 70 Malaysia Provision of pipe coating and

Sdn. Bhd. related services to the oil and
gas industry

Wasco Coatings Insulation -b -b Malaysia Dormant (In Member’s Voluntary

Sdn. Bhd. Liquidation)

#
Wasco Coatings HK Limited 100 100 Hong Kong, Investment holding, construction
SAR of coating plants, marketing and
provision of pipe coating and
related services to the oil and
gas industry

~ Wasco Kanssen Limited 100 100 British Virgin Investment holding and provision
Islands of pipe coating services

* Jingzhou Wasco Kanssen 100 100 People’s Republic Provision of pipe coating services
Offshore Petroleum of China and trading of goods
Engineering Co., Ltd.

* Kanssen (Yadong) Coating 100 100 People’s Provision of pipe coating services
Services (Jingzhou) Republic of and trading of goods
Company Limited China

* PPSC China Limited 100 100 Hong Kong, Investment holding

SAR

Wasco Berhad 209

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Details of subsidiaries are as follows (continued):

Group’s effective
interest
2023 2022 Country of
% % incorporation Principal activities

Wasco Oil Technologies 100 100 Malaysia Investment holding

Sdn. Bhd.

Wasco Oilfield Services 49p 49p Malaysia Investment holding

Sdn. Bhd.

Wasco Corrosion Services 63 63 Malaysia Dormant

Sdn. Bhd.

Wasco Lindung Sdn. Bhd. 48p 48p Malaysia Manufacture, supply and
installation of sacrificial anodes,
provision of cathodic protection
services and equipment,
corrosion protection services,
passive fire protection services,
special paint coating services
and provision of technical training
services

Asiana Emas Sdn. Bhd. 100 100 Malaysia Investment holding

Wasco Pipe (Sabah) Sdn. Bhd. 70 70 Malaysia Manufacturing and sales of spiral
(formerly known as Petro- welded pipes for the oil
Pipe (Sabah) Sdn. Bhd.) and gas industry

Wasco Engineering Group 100 100 British Virgin Investment holding

Limited Islands

#
Wasco Engineering 100 100 British Virgin Leasing of compressors and
International Ltd. Islands power generators, designing,
engineering and fabrication
and sale of gas processing
and compression systems and
gas based power generators;
and servicing and selling parts
of oil and gas processing and
compression systems

* WEGL Services India Private -l -l India Dormant

Limited

* PT Wasco Engineering 100 100 Indonesia Dormant

International

* WS Engineering & Fabrication 100 100 Singapore Design, engineering and

Pte. Ltd. fabrication of oil and gas
processing and compression
systems and equipment

210 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Details of subsidiaries are as follows (continued):

Group’s effective
interest
2023 2022 Country of
% % incorporation Principal activities

* WEGL Offshore Investments 100 100e Singapore Investment holding

Pte. Ltd.

* WEGL Investments Pte. Ltd. 100 100e Singapore Investment holding

* PT Wasco Resources 100 100e Indonesia Investment and property holding

Indonesia

~ Wasco Engineering Australia 100 100 Australia Dormant

Pty. Ltd.

* WS Engineering Equipment 100 100 Singapore Leasing of equipment and

Pte. Ltd. provision of operation and
maintenance, and other related
services to the oil and gas
industry

~ Mackenzie Hydrocarbons 100 100 Australia Provision of engineering

(Australia) Pty. Ltd. consultancy and fabrication
services

* WS Engineering Technologies 100j 92 Singapore Engineering and fabrication of oil

Pte. Ltd. and gas systems and equipment

#
PT. Wasco Engineering 100j 92 Indonesia Provision of engineering, design,
Indonesia fabrication and construction
services for oil and gas industry

* Wasco E&P Services Limited 100 100 Hong Kong, SAR Investment holding

* Wasco China International 100 100 Hong Kong, SAR Investment holding
Limited

* Ashburn Offshore Oil & Gas -q 65 People’s Republic Design and manufacturing of
Equipment & Engineering of China products to the oil and gas
(Tianjin) Co. Ltd. industry

* Ashburn International Trade -q 65 People’s Republic International trade, processing

(Tianjin) Co. Ltd. of China and assembling, storage of
bonded goods and development
of high technological products
and consultancy services

Wasco Process Engineering 100 100 Malaysia Contracting of industrial

Sdn. Bhd. (formerly known engineering projects
as Jutasama Sdn. Bhd.)

Wasco Berhad 211

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Details of subsidiaries are as follows (continued):

Group’s effective
interest
2023 2022 Country of
% % incorporation Principal activities

Peakvest Sdn. Bhd. 100 100 Malaysia Letting of properties

Jutasama Jaya Sdn. Bhd. -m 100 Malaysia Dormant (In Member’s Voluntary
Winding Up)

Wasco Greenergy Sdn. Bhd. 100n - Malaysia Investment and property holding

Wasco Thermal Sdn. Bhd. 60 60 Malaysia Undertaking of steam boilers and

(formerly known as energy system projects in both
Mackenzie Industries local and overseas markets
Sdn. Bhd.)

Wasco AgroTech Sdn. Bhd. 100 100 Malaysia Manufacturing and supplying
(formerly known as PMT of spare parts, equipment
Industries Sdn. Bhd.) and provision of maintenance
services for palm oil and other
agricultural industries

PMT Industries (Labuan) Ltd. 100 100 Federal Territory Supply of equipment for palm oil
of Labuan, and other agricultural industries
Malaysia

PMT-Phoenix Industries - -a Malaysia Dormant (In Member’s Voluntary

Sdn. Bhd. Winding Up)

PMT-Dong Yuan Industries 100 100 Malaysia Fabrication, assembly and supply
Sdn. Bhd. of machinery and equipment to
palm oil industry

* PT. Wasco AgroTech 100 100 Indonesia Supply of spare parts, equipment,
Indonesia (formerly known provision of maintenance
as PT. PMT Industri) services and engineering
consultation for palm oil and
other agricultural industries

Wasco Saito Sdn. Bhd. 51 51 Malaysia Manufacturing accessories and

(formerly known as PMT equipment under the brand of
Saito Sdn. Bhd.) ‘Saito’, for disc bowl centrifuge
for palm oil
industry, manufacturing of
decanters model SID550P and
580P for palm oil industry, and
manufacturing and development
of new products in any industry

Petro-Pipe Industrial 100 100 Malaysia Investment holding

Corporation Sdn. Bhd.

212 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Details of subsidiaries are as follows (continued):

Group’s effective
interest
2023 2022 Country of
% % incorporation Principal activities

Petro-Pipe Industries (M) 100k 100 Malaysia Investment holding

Sdn. Bhd.

PPI Industries Sdn. Bhd. 100 100 Malaysia Supplying and trading of steel
pipes and related products and
services

Syn Tai Hung Trading 100 100 Malaysia Trading and distribution of
Sdn. Bhd. building materials

~ Syn Tai Hung (Cambodia) 100 100 Kingdom of Trading and warehousing of
Co. Ltd Cambodia building materials

Syn Tai Hung Borneo 70 70 Malaysia Trading and distribution of

Sdn. Bhd. building materials

Stellar Marketing Sdn. Bhd. 100 100 Malaysia Dormant

Petro-Pipe Engineering 100 100 Malaysia Trading and distribution parts

Services Sdn. Bhd. and machineries and other
ancillary materials and services

WS Integrasi Sdn. Bhd. - 100d Malaysia Dormant (In Member’s Voluntary

Winding Up)

WDG Resources Sdn. Bhd. 60 60 Malaysia Trading, distribution, wholesale

and retail, renting, leasing and
service of industry machinery,
equipment and parts

Syn Tai Hung Marketing 60 60 Malaysia Trading, distribution and service

Sdn. Bhd. of industry machinery, equipment
and spare parts; trading and
distribution of building materials;
marketing, distribution, service,
maintenance and assembly
of industrial and agricultural
equipment

STH Edaran Sdn. Bhd. 60 60 Malaysia Marketing, distribution, service,

maintenance and assembly
of industrial and agricultural
equipment

* Wah Seong International 100 100 Hong Kong, Investment holding

Pte Limited SAR

Wasco Berhad 213

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Details of subsidiaries are as follows (continued):

Group’s effective
interest
2023 2022 Country of
% % incorporation Principal activities

~ WSIPL Australia Pty. Ltd. -f 100f Australia Dormant

Wah Seong Industrial 100 100 Malaysia Investment and property holding
Holdings Sdn. Bhd. and provision of management
services

Wah Seong Management -o 100 Malaysia Dormant (In Member’s Voluntary

Services Sdn. Bhd. Winding Up)

WSC Capital Sdn. Bhd. 100 100 Malaysia Treasury management centre
providing services to its related
companies within Malaysia and
overseas which includes cash
financing, debt management,
investment services and financial
risk management

Maple Sunpark Sdn. Bhd. 100 100 Malaysia Letting of properties

Triple Cash Sdn. Bhd. 79 79 Malaysia Investment and property holding

Sunrise Green Sdn. Bhd. 65 65 Malaysia Investment and property holding

* Audited by a firm other than member firms of PricewaterhouseCoopers International Limited and
PricewaterhouseCoopers PLT.

#
Audited by a member firm of PricewaterhouseCoopers International Limited which is a separate and
independent legal entity from PricewaterhouseCoopers PLT.

~ Companies not required by their local laws to appoint statutory auditors.

q On 21 December 2023, Wasco China International Limited (“WCIL”), an indirect wholly-owned

subsidiary of the Company surrendered 260,000 ordinary shares, representing 65% equity interest in
the total issued share capital of Ashburn International Trade (Tianjin) Co. Ltd. (“Ashburn International”)
and 552,500 ordinary shares, representing 65% equity interest in the total issued share capital
of Ashburn Offshore Oil & Gas Equipment & Engineering (Tianjin) Co. Ltd. (“Ashburn Offshore”),
respectively.

In consideration for the surrendering of Ashburn Shares, Ashburn International and Ashburn
Offshore shall repay the entire capital contribution by WCIL totalling RMB5,010,000 (equivalent to
approximately RM3,360,000) and RMB3,490,000 (equivalent to approximately RM2,340,000)
respectively, collectively amounting to RMB8,500,000 (equivalent to approximately RM5,700,000).

Upon completion of the surrendering of Ashburn Shares, Ashburn International and Ashburn Offshore
both ceased to be indirect 65% owned subsidiaries of the Company.

214 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Details of subsidiaries are as follows (continued):

p On 13 January 2022, Wasco ISOAF S.r.L (“ISOAF”), which was then an indirect 25% owned joint
venture of the Company subscribed 750 ordinary shares, representing 75% equity interest in the
issued and paid-up share capital of Wasco ISOAF Tz Limited (“ISOAF Tz”), a company incorporated in
Tanzania for a total cash consideration of TZS15,000,000 (equivalent to approximately RM27,000).

Upon completion of the subscription of ISOAF Tz shares, ISOAF Tz became a 75% owned subsidiary
of ISOAF.

Subsequently on 10 February 2022, Wasco Coatings Europe B.V. (“WCEu”), an indirect wholly-owned
subsidiary of the Company acquired additional 25.1% equity interest in the share capital of ISOAF for
a total consideration of EUR6,275 (equivalent to approximately RM29,800).

Upon completion of the acquisition of ISOAF shares, ISOAF became an indirect 50.1% owned
subsidiary of the Company and its subsidiary, ISOAF Tz became an indirect 37.6% owned subsidiary
of the Company, held through ISOAF.

On 19 December 2023, WCEu further acquired a 24.9% equity interest in the share capital of ISOAF
for a total consideration of EUR1,000,000 (equivalent to approximately RM4,931,000).

Upon completion of the acquisition of ISOAF shares, ISOAF became an indirect 75% owned subsidiary
of the Company and ISOAF Tz became an indirect 56% owned subsidiary of the Company, held
through ISOAF.

o On 27 September 2023, Wah Seong Management Services Sdn. Bhd. (“WSMS”), a direct wholly-
owned subsidiary of the Company, via its Member’s Written Resolution, issued and allotted 2,550,000
new ordinary shares at an issue price of RM1.00 each to the Company for a total consideration
of RM2,550,000, credited as fully paid-up in the share capital of WSMS, by way of capitalising
RM2,550,000 from the amount due by WSMS to the Company.

Subsequently on 12 December 2023, WSMS, had at its Extraordinary General Meeting, approved the
special resolution to wind up WSMS by way of the Member’s Voluntary Winding Up by its shareholder.

n On 5 December 2023, Wasco Greenergy Sdn. Bhd. (“WGreenergy”) was incorporated in Malaysia.
WGreenergy has an initial issued and paid-up share capital of RM10,000 divided into 10,000 ordinary
shares which were fully subscribed and paid-up by the Company.

m On 30 October 2023, Jutasama Jaya Sdn Bhd (“JJSB”) an indirect wholly-owned subsidiary of the
Company, had at its Extraordinary General Meeting, approved the special resolution to wind up JJSB
by way of the Member’s Voluntary Winding Up by its shareholder.

l On 25 March 2022, WEGL Services India Private Limited (“WEGL India”), an indirect wholly-owned
subsidiary of the Company, has commenced voluntary liquidation in accordance with the Regulation
of Insolvency and Bankruptcy Board of India. Subsequently, a notice dated 29 March 2022 was
published and stakeholders were required to submit the claims within 30 days from the date of
commencement of voluntary liquidation.

Subsequently on 12 September 2023, an order was pronounced under Section 59(8) of the
Insolvency and Bankruptcy Code, 2016, that the affairs of WEGL India have been completely wound
up and the assets have been completely liquidated and as such, WEGL India shall be dissolved.

k On 27 June 2023, Petro-pipe Industries (M) Sdn. Bhd. (“PPIM”), an indirect wholly-owned subsidiary
of the Company, had via its Directors’ Circular Resolution proposed to the full redemption of
1,000,000 fully paid-up Non-Cumulative Redeemable Preference Shares (“NCRPS”) of RM0.10 each.
The redemption shall be out of the profit of PPIM at a redemption sum of RM1,000,000 pursuant to
Section 72 of the Companies Act, 2016 and Article 12 of PPIM’s Constitution.

Wasco Berhad 215

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Details of subsidiaries are as follows (continued):

j On 15 June 2023, the Company’s indirect wholly-owned subsidiary Wasco Engineering Group Limited
(“WEGL”), entered into a Share Sale Agreements (“SSA”) for the acquisition of 415,557 ordinary
shares, equivalent to 8.01% equity interest in the issued and paid-up share capital of WS Engineering
Technologies Pte. Ltd. (“WSET”) for a total consideration of SGD600,000 (equivalent to approximately
RM2,001,000).

With the acquisitions of WSET shares, WSET and its subsidiary PT. Wasco Engineering Indonesia
became an indirect wholly-owned subsidiary of the Company, held through WEGL.

i On 1 April 2023, Wasco Coatings Limited, an indirect wholly-owned subsidiary of the Company
disposed 455,000 ordinary shares, representing 91% of the shares of Wasco Infra Services Sdn.
Bhd. (“WIS”), an indirect 91% owned subsidiary of the Company for a total sale consideration of
RM200,000.

Accordingly, WIS and its subsidiary, Eco Consortium Sdn. Bhd. ceased to be subsidiaries of the
Company.

h On 15 February 2023, Wasco Coatings Finland Oy, an indirect wholly-owned subsidiary of the
Company had completed the voluntary liquidation in accordance with the rules and regulations of the
Finnish Trade Register.

g On 16 January 2023, Wasco Coatings Norway AS, an indirect wholly-owned subsidiary of the
Company has been struck off from the Brønnøysund Register Centre, Norway upon the completion of
application by the Company.

f On 22 December 2022, WSIPL Australia Pty. Ltd. (“WSIPL Australia”), an indirect wholly-owned
subsidiary of the Company had filed for voluntary deregistration with the Australian Securities &
Investments Commission.

Subsequently on 23 February 2023, WSIPL Australia was deregistered under section 601AA(4) of the
Corporations Act 2011.

e On 29 April 2022, Wasco Engineering Group Limited (“WEGL”), an indirect wholly-owned subsidiary
of the Company entered into a Share Sale Agreement (“SSA”) for the acquisition of 100% equity
interests in WEGL Investments Pte. Ltd. (formerly known as MMA Offshore Holdings Pte. Ltd.)
(“WEGL Investments”) and WEGL Offshore Investments Pte. Ltd. (formerly known as MMA Offshore
Investments Pte. Ltd.) (“WEGL Offshore Investments”) for a total consideration of USD15,000,000
(equivalent to approximately RM65,397,000) plus the Working Capital Amount.

On 1 December 2022, the acquisition is deemed achieved with the final instalment of the Purchase
Price being paid in accordance to the terms of the SSA, PT Wasco Resources Indonesia (formerly
known as PT Jaya Asiatic Shipyard), a subsidiary of WEGL Investments and WEGL Offshore
Investments became an indirect wholly-owned subsidiary of the Company.

d On 28 April 2022, Petro-pipe Industrial Corporation Sdn. Bhd. (“PPIC”), an indirect wholly-owned
subsidiary of the Company acquired the entire equity interest held in the total issued share capital of
WS Integrasi Sdn. Bhd. (“WSI”) for a total consideration of RM1,000.

Upon completion of the WSI shares transfer exercise, WSI ceased to be a 49%-owned associate of
the Company and became an indirect wholly-owned subsidiary of the Company, held through PPIC.

On 30 December 2022, WSI had at its Extraordinary General Meeting, approved the special resolution
to wind up WSI by way of the Member’s Voluntary Winding Up by its shareholder.

216 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Details of subsidiaries are as follows (continued):

c On 17 January 2022, Wasco Capital Pte. Limited (“WCPL”), an indirect wholly-owned subsidiary
of the Company had completed the application for striking off with Accounting and Corporate
Regulatory Authority, Singapore.

Subsequently on 9 May 2022, WCPL has been struck off from the register.

b On 29 October 2021, Wasco Coatings Insulation Sdn. Bhd. (“WCI”), an indirect 70%-owned subsidiary
of the Company had at its Extraordinary General Meeting, approved the special resolution to wind
up WCI by way of the Member’s Voluntary Winding Up by its shareholder. As a result, the Group no
longer controls the subsidiary and as such it was not consolidated.

a On 15 December 2017, PMT-Phoenix Industries Sdn. Bhd. (“PMT-Phoenix”), an indirect wholly-owned

subsidiary of the Company had at its Extraordinary General Meeting, approved the special resolution
to wind up PMT-Phoenix by way of Member’s Voluntary Winding Up. As a result, the Group no longer
controls the subsidiary and as such it was not consolidated.

Subsequently on 29 February 2024, PMT-Phoenix had held its final meeting for the Member’s
Voluntary Winding Up. PMT-Phoenix will be fully dissolved after the expiration of three months from
the date of lodgement of the Return by Liquidator relating to the Final Meeting with the Companies
Commission of Malaysia and Official Receiver.

p Although the Company does not own more than 50% of the equity shares of Wasco Oilfield Services
Sdn. Bhd. (“WOS”) and Wasco Lindung Sdn. Bhd. (“WL”) and consequently it does not control more
than half of the voting power of those shares, it has the power to appoint and remove the majority of
the Board of Directors of WOS and WL. Consequently, WOS and WL are controlled by the Company
and are consolidated in these financial statements (2022: WOS, WL and ISOAF Tz).

Non-controlling interests in subsidiaries

The Group’s subsidiaries that have material non-controlling interests (“NCI”) are as follows:

Group
Wasco Other
Wasco Wasco Coatings Wasco Pipe individually
ISOAF Thermal Malaysia (Sabah) immaterial
S.R.L. Sdn. Bhd.* Sdn. Bhd. Sdn. Bhd.~ subsidiaries Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

2023

NCI percentage of ownership

interest and voting interest 27% 40% 30% 30%

Carrying amount of NCI 34,680 14,329 61,551 (1,060) 6,084 115,584

Net profit allocated to NCI 19,488 5,268 19,768 310 1,592 46,426

* Wasco Thermal Sdn. Bhd. formerly known as Mackenzie Industries Sdn. Bhd.
~ Wasco Pipe (Sabah) Sdn. Bhd. formerly known as Petro-Pipe (Sabah) Sdn. Bhd.

Wasco Berhad 217

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Non-controlling interests in subsidiaries (continued)

The Group’s subsidiaries that have material non-controlling interests (“NCI”) are as follows (continued):

Group
Wasco Wasco
Wasco Wasco Coatings Pipe
ISOAF Thermal Malaysia (Sabah)
S.R.L. Sdn. Bhd.* Sdn. Bhd. Sdn. Bhd. ~
RM’000 RM’000 RM’000 RM’000

2023

Summarised financial information before intra-

group elimination

As at 31 December
Non-current assets - 68,868 252,676 61,288
Current assets 326,903 69,975 280,504 74,914
Non-current liabilities - - (160,137) -
Current liabilities (197,210) (103,020) (167,872) (108,212)

Net assets 129,693 35,823 205,171 27,990

Financial year ended 31 December

Revenue 225,703 135,095 264,919 130,677
Net profit 38,136 13,171 65,894 1,032

Cash flows (used in)/generated from

operating activities (66,402) 57,551 67,314 12,420
Cash flows used in investing activities - (47,527) (52,801) (15,357)
Cash flows (used in)/generated from
financing activities - (2,720) 43,513 (337)

Net changes in cash and cash equivalents (66,402) 7,304 58,026 (3,274)

Dividend paid/payable to NCI - 1,088 - -

* Wasco Thermal Sdn. Bhd. formerly known as Mackenzie Industries Sdn. Bhd.
~ Wasco Pipe (Sabah) Sdn. Bhd. formerly known as Petro-Pipe (Sabah) Sdn. Bhd.

218 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

9 INVESTMENT IN SUBSIDIARIES (CONTINUED)

Non-controlling interests in subsidiaries (continued)

The Group’s subsidiaries that have material non-controlling interests (“NCI”) are as follows (continued):

Group
Wasco Wasco Other
Wasco Wasco Coatings Pipe individually
ISOAF Thermal Malaysia (Sabah) immaterial
S.R.L. Sdn. Bhd.* Sdn. Bhd. Sdn. Bhd. ~ subsidiaries Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

2022

NCI percentage of ownership

interest and voting interest 50% 40% 30% 30%

Carrying amount of NCI 43,096 10,149 41,784 (1,369) 5,254 98,914

Net profit/(loss) allocated to NCI 42,110 2,888 2,814 (1,633) 3,251 49,430

Summarised financial information

before intra-group elimination

As at 31 December
Non-current assets - 3,919 242,175 62,976
Current assets 299,766 82,740 162,258 86,608
Non-current liabilities - - (166,081) -
Current liabilities (215,429) (61,287) (99,071) (91,830)

Net assets 84,337 25,372 139,281 57,754

Financial year ended 31 December

Revenue 286,459 133,907 128,699 64,165
Net profit/(loss) 82,408 7,221 9,380 (5,442)

Cash flows generated from/(used

in) operating activities 106,340 13,530 27,596 (10,548)
Cash flows (used in)/generated
from investing activities - (23,530) (28,532) 6,843
Cash flows generated from/(used
in) financing activities 463 (5,428) 1,659 6,190

Net changes in cash and cash

equivalents 106,803 (15,428) 723 2,485

Dividend paid/payable to NCI - 488 - -

* Wasco Thermal Sdn. Bhd. formerly known as Mackenzie Industries Sdn. Bhd.
~ Wasco Pipe (Sabah) Sdn. Bhd. formerly known as Petro-Pipe (Sabah) Sdn. Bhd.

Wasco Berhad 219

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

10 INVESTMENT IN ASSOCIATES

Group
Note 2023 2022
RM’000 RM’000

Quoted shares in Malaysia (a) 130,114 130,114

Unquoted shares (b) 94,527 90,790
Share of post-acquisition results and reserves (54,494) (63,953)

170,147 156,951
Less: Accumulated impairment loss (57,405) (55,133)

112,742 101,818

Share of net assets of associates 112,742 101,818

Quoted shares in Malaysia at fair value 82,223 74,433

(a) Quoted shares – Petra Energy Berhad

As at 31 December 2023 and 31 December 2022, the fair value of the Group’s investment in quoted
shares is based on Level 1 of the fair value hierarchy.

The market value of the Group’s interest in quoted shares, representing its fair value as at 31
December 2023, was approximately RM82,223,000 (2022: RM74,433,000). This fair value
is approximately RM30,331,000 (2022: RM27,087,000) below the carrying value, giving rise
to an impairment indicator on the carrying value of the investment of RM112,554,000 (2022:
RM101,520,000).

As the fair value less costs of disposal is lower than the value-in-use of the investment, the Group
has determined the recoverable amount of the investment using discounted cash flows expected
to be generated from the investment. The calculations use pre-tax cash flow projections based on
financial budgets approved by the Group covering a period of 5 years (2022: 5 years) based on past
performance and management’s expectations of market development. Terminal value is estimated at
the end of the 5-year period.

Due to the uncertainty of the future economic condition, management developed the best, base case
and worst case scenario of cash flow projections. Probabilities of occurrence were assigned to each
scenario to arrive at a single set of cash flow projection. The assumptions used in all three scenarios
and the probabilities of occurrence assigned required management’s judgement.

The key assumptions used in the cash flow projections to determine the recoverable amount for the
investment under the best, base case and worst case scenarios are as follows:

(i) The revenue forecast is supported by management’s expected projects, which is in line with
past performance records, future market outlook and management’s expectation of market
developments. A reduction to the revenue forecast was applied for all three scenarios;
(ii) Pre-tax discount rate of 18.5% (2022: 16.3%) was applied for all three scenarios, benchmarked
against comparable companies at the date of assessment; and
(iii) A terminal growth rate of Nil (2022: 1.0%) was applied across all three scenarios.

The value-in-use is above the carrying value of the Group’s investment in quoted shares. As such,
no impairment loss is deemed necessary to be recognised in the financial year ended 31 December
2023 and 31 December 2022.

220 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

10 INVESTMENT IN ASSOCIATES (CONTINUED)

(a) Quoted shares – Petra Energy Berhad (continued)

Sensitivity

As at 31 December 2023, an increase of 1% in pre-tax discount rate, with all other inputs remaining
constant, will not result in a material effect on the Group’s impairment charge.

(b) Unquoted shares – Evraz Wasco Pipe Protection Corporation (“EWPPC”)

In the previous financial year, due to imposition of international prohibitions on certain linked
individuals, the Group recorded a reduction of USD8,986,000 (equivalent to approximately
RM39,537,000) on the carrying amount of its investment in EWPPC. This will be written back when
the international prohibitions are subsequently removed.

Impairment of investment in associates

The movements for allowance for impairment losses on investment in associates during the financial
year are as follows:

Group
2023 2022
RM’000 RM’000

At 1 January 55,133 14,606

Impairment loss recognised - 39,537
Effect of exchange rate changes 2,272 990

At 31 December 57,405 55,133

Wasco Berhad 221

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

10 INVESTMENT IN ASSOCIATES (CONTINUED)

Details of associates are as follows:

Group’s effective
interest
Country of 2023 2022
incorporation % % Principal activities

WS Integrasi Sdn. Bhd. Malaysia - -b Trading, distribution, sales and

marketing of the Group's product and
services in the oil & gas, renewable
energy, engineering, industrial and
property (including land acquisitions)
industries as well as undertaking
other external business services
opportunities

Petra Energy Berhad Malaysia 27 27 Investment holding

Evraz Wasco Pipe Canada 49 49 Provision of pipe coating services

Protection Corporation

Syarikat Beka Sdn. Bhd. Malaysia 48 48 Dormant

Wah Seong Boustead Myanmar 50 50 Property development, trading and

Company Limited provision of auxiliary services

Spirolite (M) Sendirian Malaysia - -a Manufacturing and trading of spiral

Berhad pipes, straight pipes, tubes, tanks and
containers

b On 28 April 2022, Petro-pipe Industrial Corporation Sdn. Bhd. (“PPIC”), an indirect wholly-owned
subsidiary of the Company acquired the entire equity interest held in the total issued share capital of
WS Integrasi Sdn. Bhd. (“WSI”) for a total consideration of RM1,000.

Upon completion of the WSI shares transfer exercise, WSI ceased to be a 49%-owned associate of
the Company and became an indirect wholly-owned subsidiary of the Company, held through PPIC.

a On 22 March 2022, Syn Tai Hung Trading Sdn. Bhd. (“STHT”), an indirect wholly-owned subsidiary of
the Company exercised the Put Option granted under the Put Option Agreement for the disposal of
3,342,686 ordinary shares, representing 30% ordinary shareholdings in the issued and paid-up share
capital of Spirolite (M) Sendirian Berhad (“Spirolite Malaysia”) for a total cash sale consideration of
RM30,800,000 subject to the terms and conditions of the Put Option Agreement.

On 28 March 2022, the disposal has been completed in accordance to the terms of the Put Option
Agreement. Upon the completion of the disposal, Spirolite Malaysia ceased to be 30%-owned
associate of STHT and the Company.

222 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

10 INVESTMENT IN ASSOCIATES (CONTINUED)

The following table summarises the information of the Group’s material associates and reconciles the
information to the carrying amount of the Group’s interest in the associates. The information has been
adjusted to reflect the equity method of accounting, including fair value adjustments:

Group
Evraz Other
Petra Wasco Pipe individually
Energy Protection immaterial
Berhad Corporation associates Total
2023 RM’000 RM’000 RM’000 RM’000

Summarised financial information

As at 31 December
Non-current assets 274,722 46,304
Current assets 399,252 171,917
Non-current liabilities (5,397) -
Current liabilities (250,161) (101,067)

Net assets 418,416 117,154

Financial year ended 31 December

Revenue 553,315 -
Net profit 60,325 -
Total comprehensive income 60,325 -

Reconciliation of net assets to carrying amount

As at 31 December
Group’s share of net assets 112,554 57,405 121 170,080
Goodwill - - 67 67
Less: Accumulated impairment loss - (57,405) - (57,405)

Carrying amount in statement of financial

position 112,554 - 188 112,742

Group’s share of results

Financial year ended 31 December

Group’s share of profit 16,227 -* 80 16,307

Dividend receivable/received 5,193 - 190 5,383

* During the current financial year, the Group no longer share the profit of its investment in EWPPC as
the carrying amount of the investment in EWPPC was reduced to nil.

Wasco Berhad 223

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

10 INVESTMENT IN ASSOCIATES (CONTINUED)

The following table summarises the information of the Group’s material associates and reconciles the
information to the carrying amount of the Group’s interest in the associates. The information has been
adjusted to reflect the equity method of accounting, including fair value adjustments (continued):

Group
Evraz Other
Petra Wasco Pipe individually
Energy Protection immaterial
Berhad Corporation associates Total
2022 RM’000 RM’000 RM’000 RM’000

Summarised financial information

As at 31 December
Non-current assets 281,193 44,472
Current assets 345,821 165,112
Non-current liabilities (35,107) -
Current liabilities (214,510) (97,067)

Net assets 377,397 112,517

Financial year ended 31 December

Revenue 370,724 26,897
Net profit/(loss) 4,201 (26,065)
Total comprehensive income/(loss) 4,201 (26,065)

Reconciliation of net assets to carrying amount

As at 31 December
Group’s share of net assets 101,520 55,133 231 156,884
Goodwill - - 67 67
Less: Accumulated impairment loss - (55,133) - (55,133)

Carrying amount in statement of financial

position 101,520 - 298 101,818

Group’s share of results

Financial year ended 31 December

Group’s share of profit/(loss) 1,130 (12,772) 28 (11,614)

Dividend receivable/received 3,462 - 85 3,547

224 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

11 INVESTMENT IN JOINT VENTURES

Group
2023 2022
RM’000 RM’000

Unquoted shares 170,625 167,977

Share of post-acquisition results and reserves (128,393) (113,619)

42,232 54,358
Less: Accumulated impairment loss (22,052) (21,658)

20,180 32,700

Share of net assets of joint ventures 20,180 32,700

Unquoted shares – Alam-PE Holdings (L) Inc.

For the financial year ended 31 December 2023 and 2022, the Group reviewed the recoverable amount of
its investment in a joint venture, Alam-PE Holdings (L) Inc. as impairment indicator exist due to ALAM-PE’s
low vessel utilisation in the current financial year resulted in ALAM-PE continuing to incur losses and the
significant shortfall of its actual loss and the budgeted profits for the current financial year indicated that
the investment may be impaired.

The Group has determined the recoverable amount of the investment by assessing the individual vessels,
each of which is a single CGU by itself. The recoverable amount of each vessel are ascertained by using
higher of respective fair value less cost to sell and value-in-use.

The fair values of the vessels were based on the valuation report issued by an independent professional
valuer on the basis that the vessels are in sound sea-going condition and have undergone the required
regular dry dock. Due to the time approximation to the next dry dock, the fair valuation of the vessels were
reduced by the estimated dry docking cost the buyer will need to dry dock the vessels within a year after
purchase.

As value-in-use was determined by using the discounted cash flows derived from pre-tax cash flow
projections based on financial budgets approved by the Group covering a period of 3 years (2022: 5
years) based on past performance of each vessel and expectations of the market development. Due to
the uncertainty of the future economic condition, management developed the base case and worst case
scenario of cash flow projections. Probabilities of occurrence were assigned to each scenario to arrive
at a single set of cash flow projection. The assumptions used in both scenarios and the probabilities of
occurrence assigned required management’s judgement.

The key assumptions used in the cash flow projections for the investment are as follows:

(a) (i) An average vessel utilisation rate for 3 years of 23% in current financial year;
(ii) An average vessel utilisation rate for 5 years of 51% was applied to both the base case and
worst case scenario in previous financial year. The average utilisation rate is affected by the
timing of vessels completing their dry docking;
(b) Pre-tax discount rate of 14% (2022: 12.1%) was applied, benchmarked against comparable
companies at the date of assessment; and
(c) No terminal growth rate was applied in the current and previous financial year.

Based on management’s impairment assessment, no impairment loss is deemed necessary to be

recognised for the financial year ended 31 December 2023. The Group had recognised an impairment loss
of RM8,989,000 for the financial year ended 31 December 2022.

Wasco Berhad 225

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

11 INVESTMENT IN JOINT VENTURES (CONTINUED)

Sensitivity

As at 31 December 2023, an increase of 1% of pre-tax discount rate and 5% average vessel utilisation
rate will not result in a material effect on the Group’s impairment charges.

Impairment of investment in joint ventures

The movements for allowance for impairment loss on investment in joint ventures during the financial year
are as follows:

Group
2023 2022
RM’000 RM’000

At 1 January 21,658 12,139

Impairment loss recognised - 8,989
Effect of exchange rate changes 394 530

At 31 December 22,052 21,658

226 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

11 INVESTMENT IN JOINT VENTURES (CONTINUED)

Details of joint ventures are as follows:

Group’s effective
interest
Country of 2023 2022
incorporation % % Principal activities

Boustead Wah Seong Sdn. Bhd. Malaysia 50 50 Investment holding activities

and businesses in
property development and
management; provision
of general fabrication,
engineering and oil and
gas services; trading and
marketing activities and
any other businesses or
projects as shall be mutually
agreed from time to time in
Myanmar

Socotherm Shashi Pipe People’s 50 50 Dormant

Coating Co. Ltd. Republic of
China

Socotherm PPSC Ningbo (Daxie) People’s 50 50 Dormant

Pipe Coating Co. Limited Republic of
China

Sichuan Chuanshi Kanssen People’s 51 51 Provision of pipe coating

(Yadong) Coating Services Republic of services
Company Limited China

Shaanxi Yadong Anti-Corrosion People’s 55 55 Provision of pipe coating

Company Limited Republic of services
China

Bayou Wasco Insulation, LLC United States 49 49 Provision of thermal insulation

of America coating services to pipes or
pipelines

Shinko Wasco Turbine Sdn. Malaysia 49 49 Assembly and supply of

Bhd. (formerly known as PMT equipment for palm oil and
SHINKO Turbine Sdn. Bhd.) other agricultural industries

Welspun Wasco Coatings India 49 49 Provision of pipe coating

Private Limited services

Alam-PE Holdings (L) Inc. Federal Territory 49 49 Investment holding

of Labuan,
Malaysia

Wasco Berhad 227

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

11 INVESTMENT IN JOINT VENTURES (CONTINUED)

The following table summarises the information of the Group’s material joint ventures and reconciles the
information to the carrying amount of the Group’s interest in the joint ventures. The information has been
adjusted to reflect the equity method of accounting, including fair value adjustments:

Group
Bayou Boustead
Alam-PE Wasco Wah
Holdings Insulation, Seong
(L) Inc. LLC Sdn. Bhd.
RM’000 RM’000 RM’000

2023

Summarised financial information

As at 31 December
Non-current assets 16,775 60,668 -
Current assets 14,131 110,201 3,008
Cash and cash equivalents 4,201 287 23,997
Non-current liabilities - (72,780) -
Current liabilities (11,843) (97,196) (12,065)
Non-controlling interest - - (13,456)

Net assets 23,264 1,180 1,484

Financial year ended 31 December

Net (loss)/profit (24,283) 1,211 (3,050)
Other comprehensive income - 6,542 602

Total comprehensive (expense)/income (24,283) 7,753 (2,448)

Included in the total comprehensive (expense)/income are:

Revenue 20,920 73,562 1,197
Interest income - - 227
Depreciation and amortisation (9,820) (7,368) (102)
Interest expense - (1,157) (1,120)
Tax expense - - 368

228 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

11 INVESTMENT IN JOINT VENTURES (CONTINUED)

The following table summarises the information of the Group’s material joint ventures and reconciles the
information to the carrying amount of the Group’s interest in the joint ventures. The information has been
adjusted to reflect the equity method of accounting, including fair value adjustments (continued):

Group
Other
Bayou Boustead individually
Alam-PE Wasco Wah immaterial
Holdings Insulation, Seong joint
(L) Inc. LLC Sdn. Bhd. ventures Total
RM’000 RM’000 RM’000 RM’000 RM’000

2023

Reconciliation of net assets to

carrying amount

As at 31 December
Group’s share of net assets 11,399 578 742 12,706 25,425
Goodwill 11,989 - - - 11,989
Less: Accumulated impairment
loss (11,989) - - (10,063) (22,052)
Reclass to other payables* - - - 4,818 4,818

Carrying amount in statement

of financial position 11,399 578 742 7,461 20,180

Group’s share of results

Financial year ended

31 December
Group’s share of (loss)/profit (11,898) 593 (1,525) 1,061 (11,769)
Group’s share of other
comprehensive income - 3,206 301 - 3,507

Dividend receivable/received - - - 1,070 1,070

* The Group is committed to make good its share of losses of the investment in joint ventures.
Accordingly, other payables related to the losses are recognised.

Wasco Berhad 229

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

11 INVESTMENT IN JOINT VENTURES (CONTINUED)

The following table summarises the information of the Group’s material joint ventures and reconciles the
information to the carrying amount of the Group’s interest in the joint ventures. The information has been
adjusted to reflect the equity method of accounting, including fair value adjustments (continued):

Group
Bayou Boustead
Alam-PE Wasco Wah
Holdings Insulation, Seong
(L) Inc. LLC Sdn. Bhd.
RM’000 RM’000 RM’000

2022

Summarised financial information

As at 31 December
Non-current assets 45,107 65,392 1,359
Current assets 8,157 40,188 7,145
Cash and cash equivalents 2,491 15,844 20,538
Non-current liabilities - (66,450) -
Current liabilities (8,209) (61,957) (10,762)
Non-controlling interest - - (14,349)

Net assets/(liabilities) 47,546 (6,983) 3,931

Financial year ended 31 December

Net loss (1,250) (9,411) (10,291)
Other comprehensive income - - 1,010

Total comprehensive expense (1,250) (9,411) (9,281)

Included in the total comprehensive expense are:

Revenue 14,361 92 5,397
Interest income - - 335
Depreciation and amortisation (9,007) (7,580) (2,449)
Interest expense - (1,113) (981)
Tax expense - - (1,248)

230 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

11 INVESTMENT IN JOINT VENTURES (CONTINUED)

The following table summarises the information of the Group’s material joint ventures and reconciles the
information to the carrying amount of the Group’s interest in the joint ventures. The information has been
adjusted to reflect the equity method of accounting, including fair value adjustments (continued):

Group
Other
Bayou Boustead individually
Alam-PE Wasco Wah immaterial
Holdings Insulation, Seong joint
(L) Inc. LLC Sdn. Bhd. ventures Total
RM’000 RM’000 RM’000 RM’000 RM’000

2022

Reconciliation of net assets to

carrying amount

As at 31 December
Group’s share of net assets/
(liabilities) 23,297 (3,422) 1,966 10,632 32,473
Goodwill 11,989 - - 1,782 13,771
Less: Accumulated impairment
loss (11,989) - - (9,669) (21,658)
Less: Elimination of unrealised
profits - (1,264) - - (1,264)
Reclass to other payables* - 4,686 - 4,692 9,378

Carrying amount in statement

of financial position 23,297 - 1,966 7,437 32,700

Group’s share of results

Financial year ended

31 December
Group’s share of loss (613) (4,611) (5,146) (966) (11,336)
Group’s share of other
comprehensive income - - 505 427 932

Dividend receivable/received - - - 4,406 4,406

* The Group is committed to make good its share of losses of the investment in joint ventures.
Accordingly, other payables related to the losses are recognised.

Wasco Berhad 231

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

12 CONTRACT ASSETS/(LIABILITIES)

Net carrying amount of contract assets/(liabilities) is analysed as follows:

Group
2023 2022
RM’000 RM’000

At 1 January
- Contract assets 395,814 242,479
- Contract liabilities (314,049) (133,314)

81,765 109,165

Over time
Revenue recognised in the current financial year
- that was included in the contract liabilities at 1 January 232,936 103,561
- from additional contract assets and contract liabilities during the
financial year 1,675,432 1,927,556
Less: Billings during the financial year (1,877,084) (2,082,052)

31,284 (50,935)

Point in time
Revenue recognised in the current financial year
- that was included in the contract liabilities at 1 January 14,063 16,811
- from additional contract assets and contract liabilities during the
financial year 120,132 59,605
Less: Billings during the financial year (136,779) (74,755)

(2,584) 1,661

Transfer to assets/liabilities of disposal group classified as held for sale 1,895 -

Effect of exchange rate changes 14,153 21,874

At 31 December 126,513 81,765

At 31 December
- Contract assets 446,339 395,814
- Contract liabilities (319,826) (314,049)

126,513 81,765

Revenue relating to performance obligations that are unsatisfied or partially unsatisfied as at 31 December
2023 amounting to RM3,144,000,000 (2022: RM3,437,000,000) are expected to be recognised within
the next 12 to 24 months (2022: within the next 12 to 24 months).

35.5% (2022: 25.6%) of the contract asset balances are related to a single customer.

232 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

13 INVENTORIES

Group
2023 2022
RM’000 RM’000

Raw materials 88,337 104,902

Work-in-progress 29,382 35,605
Manufactured and trading goods 45,580 62,297
Consumables 19,767 14,872
Goods in transit 3,258 5,719

186,324 223,395

14 TRADE AND OTHER RECEIVABLES

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Current

Gross trade receivables 459,017 511,407 - -

Less: Allowance for impairment loss (14,976) (33,100) - -

444,041 478,307 - -

Gross other receivables 36,255 69,932 343 13,615

Less: Allowance for impairment loss (14,852) (49,543) (15) (13,262)

21,403 20,389 328 353

Prepaid supplies 74,271 35,250 - -

Deposits 8,364 7,431 22 29
Prepayments 15,493 16,914 165 284

563,572 558,291 515 666

Non-current

Deposits 3,603 3,451 - -

Wasco Berhad 233

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

14 TRADE AND OTHER RECEIVABLES (CONTINUED)

Credit risk concentration profile

The Group determines concentration of credit risk by monitoring the business segment of its trade
receivables on an ongoing basis. The credit risk concentration profile of the Group’s trade receivables at
the reporting date is as follows:

Group
2023 2022
RM’000 RM’000

Energy Services 408,808 352,758

Bioenergy Services 35,233 39,104
Trading - 86,445

Total 444,041 478,307

Concentration of credit risk is low within the Energy Services segment which primarily trade with oil
majors. However, the Group considers the risk of default by these oil majors to be minimal given their
relative size and financial strength.

There is no concentration of credit risk within the Bioenergy Services and Trading as the balances are
distributed over a large number of customers.

The following table contains an analysis of the credit risks exposure for which expected credit loss is
recognised:

Gross trade Expected Net trade

receivables credit loss receivables
RM’000 RM’000 RM’000

2023

Not past due 131,741 (22) 131,719

1 to 30 days overdue 149,681 (1,339) 148,342
31 to 60 days overdue 67,990 (9) 67,981
61 to 90 days overdue 27,624 (12) 27,612
91 to 180 days overdue 19,848 (1,299) 18,549
181 to 365 days overdue 47,210 (3,483) 43,727
More than 365 days overdue 14,923 (8,812) 6,111

Total 459,017 (14,976) 444,041

234 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

14 TRADE AND OTHER RECEIVABLES (CONTINUED)

Credit risk concentration profile (continued)

The following table contains an analysis of the credit risks exposure for which expected credit loss is
recognised (continued):

Gross trade Expected Net trade

receivables credit loss receivables
RM’000 RM’000 RM’000

2022

Not past due 202,537 (21) 202,516

1 to 30 days overdue 160,764 (19) 160,745
31 to 60 days overdue 65,573 (67) 65,506
61 to 90 days overdue 18,097 (142) 17,955
91 to 180 days overdue 23,251 (672) 22,579
181 to 365 days overdue 7,711 (2,690) 5,021
More than 365 days overdue 33,474 (29,489) 3,985

Total 511,407 (33,100) 478,307

Trade receivables that are individually determined to be impaired at the reporting date relate to debtors
that are in significant financial difficulties and have defaulted on payments. These receivables are not
secured by any collateral.

Receivables that are neither past due nor impaired

Trade and other receivables of the Group and the Company that are not impaired are in respect of
creditworthy debtors with reliable payment records and have a low risk of default. Most of the Group’s
trade receivables arise from customers with more than 5 years of experience with the Group.

The movements in the allowance for impairment loss of trade receivables during the financial year are as
follows:

Group
2023 2022
RM’000 RM’000

At 1 January 33,100 26,303

Impairment loss recognised 2,801 9,492
Impairment loss reversed (8,280) (2,643)
Bad debts written off (374) -
Transfer to assets of disposal group classified as held for sale (12,593) (422)
Effect of exchange rate changes 322 370

At 31 December 14,976 33,100

Trade receivables that are individually determined to be impaired at the reporting date relate to balances
for which recoveries are doubtful. These receivables are not secured by any collateral.

Wasco Berhad 235

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

14 TRADE AND OTHER RECEIVABLES (CONTINUED)

The movements in the Group’s and the Company’s allowance for impairment loss of other receivables
during the financial year are as follows:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

At 1 January 49,543 48,235 13,262 12,534

Impairment loss recognised 16 301 - -
Bad debts written off (35,687) (252) (13,247) -
Transfer to assets of disposal group classified
as held for sale (16) - - -
Effect of exchange rate changes 996 1,259 - 728

At 31 December 14,852 49,543 15 13,262

The Group’s trade receivables exposure to foreign currency (a currency which is other than the functional
currency of the Group entities) risk were:

Group
2023 2022
RM’000 RM’000

Gross trade receivables

- United States Dollar 121,137 127,419
- Indonesian Rupiah 11,920 4,610
- Singapore Dollar 1,502 2,052
- Japanese Yen 758 705
- Euro Dollar - 400

135,317 135,186

236 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

14 TRADE AND OTHER RECEIVABLES (CONTINUED)

The Group’s and the Company’s other receivables, deposits and prepayments exposure to foreign currency
(a currency which is other than the functional currency of the Group entities and the Company) risk were:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Gross other receivables, deposits and

prepayments
- United States Dollar 39,009 34,875 - 13,247
- Euro Dollar 14,631 2,461 - -
- Japanese Yen 5,285 - - -
- Ringgit Malaysia 2,900 2,259 - -
- Indonesian Rupiah 1,299 6,363 - -
- China Renminbi 922 - - -
- Singapore Dollar 580 1,245 - -
- Qatari Rial - 12,998 - -

64,626 60,201 - 13,247

15 AMOUNTS OWING BY/(TO) SUBSIDIARIES

(a) Amounts owing by subsidiaries

Company
2023 2022
RM’000 RM’000

Interest bearing loans (unsecured) 14,250 9,668

Interest free advances (unsecured) 2,221 11,621

16,471 21,289
Less: Allowance for impairment loss (350) (2,792)

16,121 18,497

The effective interest rate of interest bearing loans as at 31 December 2023 ranges between 6.15%
to 6.40% (2022: 3.94% to 6.15%) per annum. The loans and advances are denominated in Ringgit
Malaysia and are recoverable on demand.

Wasco Berhad 237

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

15 AMOUNTS OWING BY/(TO) SUBSIDIARIES (CONTINUED)

(a) Amounts owing by subsidiaries (continued)

The movements in the Company’s allowance for impairment loss of amount owing by subsidiaries
during the financial year are as follows:

Company
2023 2022
RM’000 RM’000

At 1 January 2,792 232

Impairment loss reversed (2,469) -
Impairment loss recognised 27 2,560

At 31 December 350 2,792

During the financial year ended 31 December 2023, the amounts owing by subsidiaries are
considered performing except for certain interest bearing loans and interest free advances owing
by subsidiaries of RM27,000 (2022: RM2,560,000) which are deemed not performing. Hence,
RM27,000 (2022: RM2,560,000) was impaired during the financial year.

(b) Amounts owing to subsidiaries

Company
2023 2022
RM’000 RM’000

Interest bearing loans (unsecured) 32,888 22,400

Non-trade accounts 2,545 10

35,433 22,410

The effective interest rate of interest bearing loans as at 31 December 2023 ranges between 3.11%
to 3.36% (2022: 2.11% to 4.55%) per annum. The loans are denominated in Ringgit Malaysia and are
repayable on demand.

Non-trade accounts are denominated in Ringgit Malaysia, unsecured, interest free and repayable on
demand.

238 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

16 AMOUNTS OWING BY ASSOCIATES

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Current

Advances 3,435 3,409 - -

Less: Allowance for impairment loss (3,255) (3,285) - -

180 124 - -

Non-current

Trade accounts 16,439 25,677 - -

Less: Allowance for impairment loss (16,439) (25,677) - -

- - - -

Trade accounts are unsecured, interest free and recoverable within the normal credit period. The advances
are unsecured, interest free and recoverable on demand.

The movements in the Group’s and the Company’s allowance for impairment loss of amount owing by
associates during the financial year are as follows:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

At 1 January 28,962 7,546 - 43

Impairment loss recognised - 21,378 - -
Impairment loss reversed (10,216) (108) - (43)
Effect of exchange rate changes 948 146 - -

At 31 December 19,694 28,962 - -

Amounts owing by associates are denominated in United States Dollar and Ringgit Malaysia. The Group
has no significant exposure to foreign currency risk for the amounts owing by associates.

Wasco Berhad 239

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

17 AMOUNTS OWING BY/(TO) JOINT VENTURES

(a) Amounts owing by joint ventures

Group
2023 2022
RM’000 RM’000

Current

Advances 146 205

Non-current

Trade accounts 5,525 2,369

Interest bearing loans 52,843 54,837
Advances 1,989 1,690

60,357 58,896
Less: Allowance for impairment loss (36,508) (27,290)

23,849 31,606

During the financial year ended 31 December 2023, the amounts owing by joint ventures are
considered performing except for certain interest bearing loans owing by a joint venture of
RM8,065,000 (2022: RM Nil) which are deemed not performing. Hence, RM8,065,000 (2022: RM Nil)
was impaired during the financial year.

Trade accounts are unsecured and interest free.

The Group’s effective interest rate of interest bearing loans as at 31 December 2023 is between
3.26% to 3.75% (2022: 3.26% to 3.75%) per annum. The loans and advances are unsecured and
recoverable on demand.

The movements in the allowance for impairment loss on the Group’s amounts owing by joint ventures
during the financial year are as follows:

Group
2023 2022
RM’000 RM’000

At 1 January 27,290 26,697

Impairment loss recognised 8,065 -
Effect of exchange rate changes 1,153 593

At 31 December 36,508 27,290

The Group has no significant exposure to foreign currency risk for the amounts owing by joint
ventures except for an amount of RM20,811,000 (2022: RM18,876,000) denominated in United
States Dollar.

240 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

17 AMOUNTS OWING BY/(TO) JOINT VENTURES (CONTINUED)

(b) Amounts owing to joint ventures

Group
2023 2022
RM’000 RM’000

Trade accounts 7,341 3,247

Non-trade accounts 232 246

7,573 3,493

Trade accounts are unsecured, interest free and repayable within 30 to 90 days. Non-trade accounts
are unsecured, interest free and repayable on demand.

The Group’s amounts owing to joint ventures exposure to foreign currency (a currency which is other
than the functional currency of the Group entities) risk were:

Group
2023 2022
RM’000 RM’000

- Japanese Yen 6,914 2,887

- China Renminbi 659 605

18 DERIVATIVE FINANCIAL ASSETS/(LIABILITIES)

Contract/
notional amount Assets Liabilities
RM’000 RM’000

Group

2023

Current

Derivative instruments at fair value through profit or loss

- Forward currency contracts RM 42,523,000
SGD 42,099,000
USD 11,240,000
AUD 211,000
EUR 200,000 154 (4,100)

Wasco Berhad 241

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

18 DERIVATIVE FINANCIAL ASSETS/(LIABILITIES) (CONTINUED)

Contract/
notional amount Assets Liabilities
RM’000 RM’000

Group

2022

Current

Derivative istruments at fair value through profit or loss

- Forward currency contracts RM 66,856,000
USD 17,655,000
CNY 15,075,000
SGD 12,226,000
EUR 1,605,000 82 (2,627)

The Company did not hold any derivative financial instruments as at 31 December 2023 (2022: nil).

Forward currency contracts

The Group enters into foreign currency forward contracts to protect the Group from movements
in exchange rates by establishing the rate at which a foreign currency asset or liability will be settled.
Forward currency contracts are mainly used to hedge certain trade receivables and trade payables
denominated in United States Dollar, Singapore Dollar, Ringgit Malaysia, Euro Dollar and Australian Dollar
for which firm commitments existed at the reporting date, extending to November 2024.

Gains or losses arising from fair value changes of its financial assets and financial liabilities

During the financial year, the Group recognised a loss of RM1,374,000 (2022: RM2,422,000) in the profit
or loss arising from fair value changes of its derivative financial assets and liabilities. The method and
assumptions applied in determining the fair value of derivatives are disclosed in Note 46.

242 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

19 TIME DEPOSITS

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Time deposits placed with licensed banks

in Malaysia 79,513 29,566 684 1,466
Time deposits with maturity more than
3 months 23,668 23,515 - -

103,181 53,081 684 1,466

As at 31 December 2023 and 31 December 2022, the Group and the Company have no exposure to
foreign currency risk for time deposits and short term investments.

The effective interest rates of time deposits of the Group and the Company are as follows:

Group Company
2023 2022 2023 2022
% % % %

Time deposits 1.20 – 3.31 1.00 – 2.70 2.00 – 2.75 1.00 – 2.00

20 CASH AND BANK BALANCES

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Cash and bank balances 307,163 275,929 2,915 1,801

The Group’s and the Company’s cash and cash equivalents exposure to foreign currency (a currency which
is other than the functional currency of the Group entities and the Company) risk were:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

- United States Dollar 63,570 120,640 219 367

- Singapore Dollar 12,396 7,482 - 122
- Japanese Yen 8,496 5,148 - -
- China Renminbi 2,416 1,666 - -
- Indonesian Rupiah 2,009 331 - -
- Euro Dollar 1,720 1,603 - -
- Qatari Rial 1,216 740 - -
- British Pound 843 959 - -

92,666 138,569 219 489

Cash and bank balances are deposits held at call with banks and earn no interest.

Wasco Berhad 243

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

21 ASSETS CLASSIFIED AS HELD FOR SALE

(a) On 29 February 2024, the Company entered into a sale and purchase agreement for the disposal of
leasehold buildings for a consideration of RM36,000,000.

The completion of the disposal is subject to fulfilment of the condition precedent as stipulated in the
sale and purchase agreement.

Pursuant to MFRS 5 ‘Non-current Assets Held for Sale and Discontinued Operations’, the carrying
amount of the leasehold buildings has been classified as assets held for sale and is presented as part
of the Others segment in Note 43.

(b) On 12 October 2023, the Company’s wholly-owned subsidiary, Wasco Agrotech Sdn. Bhd. (formerly
known as PMT Industries Sdn. Bhd.) (“WAT”), entered into a sale and purchase agreement for the
disposal of freehold land and buildings for a consideration of RM40,000,000.

The completion of the disposal is subject to fulfilment of the condition precedent as stipulated in the
sale and purchase agreement.

Pursuant to MFRS 5 ‘Non-current Assets Held for Sale and Discontinued Operations’, the carrying
amount of the leasehold buildings has been classified as assets held for sale and is presented as part
of the Bioenergy Services segment in Note 43.

Subsequently on 16 January 2024, WAT completed the disposal of the said freehold land and
buildings by fulfilling condition precedent as stipulated in the sale and purchase agreement.

(c) On 12 July 2023, the Company’s wholly-owned subsidiary, Maple Sunpark Sdn. Bhd. (“MSSB”)
entered into a sale and purchase agreement for the disposal of leasehold land for a consideration of
RM22,193,000.

On 19 October 2023, MSSB completed the disposal of the said leasehold land by fulfilling condition
precedent as stipulated in the sale and purchase agreement. Accordingly, the carrying amount of
the said leasehold land was derecognised as assets held for sale, resulting in a gain on disposal of
RM14,846,000 being recognised in the statement of profit or loss during the financial year.

(d) On 28 April 2022, the Company’s wholly-owned subsidiary, Petro-Pipe Industries (M) Sdn. Bhd.
(“PPIM”) entered into a sale and purchase agreement for the disposal of leasehold land for a
consideration of RM26,528,000.

On 15 February 2023, PPIM completed the disposal of the said leasehold land by fulfilling condition
precedent as stipulated in the sale and purchase agreement. Accordingly, the carrying amount of
the said leasehold land was derecognised as assets held for sale, resulting in a gain on disposal of
RM8,249,000 being recognised in the statement of profit or loss during the financial year.

(e) On 11 November 2021, the Company’s wholly-owned subsidiary, Petro-Pipe Industries (M) Sdn.
Bhd. (“PPIM”) entered into a sale and purchase agreement for the disposal of leasehold land for a
consideration of RM11,565,000.

On 30 May 2022, PPIM completed the disposal of the said leasehold land by fulfilling condition
precedent as stipulated in the sale and purchase agreement. Accordingly, the carrying amount of the
said plant and machineries was derecognised as assets held for sale, resulting in a gain on disposal
of RM5,150,000 being recognised in the statement of profit or loss in the previous financial year.

(f) On 23 November 2021, the Company’s indirect wholly-owned subsidiary, WS Engineering &
Fabrication Pte Ltd (“WSEF”) offered an Option to Purchase for the disposal of buildings for a total
consideration of SGD13,000,000 (equivalent to approximately RM40,102,000).

On 2 September 2022, WSEF received from the purchaser a letter from National Environment Agency
(“NEA”) of Singapore dated 19 August 2022. The purchaser was unable to procure and obtain written
approval from the Jurong Town Corporation following the rejection by the NEA of Singapore on the
intended use of the buildings by the purchaser. Accordingly, the carrying amount of the buildings was
derecognised as assets held for sale and classified as property, plant and equipment.

244 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

21 ASSETS CLASSIFIED AS HELD FOR SALE (CONTINUED)

Details of the carrying value of the assets classified as held for sale are as follows:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Property, plant and equipment 9,671 3,531 6,390 -

Investment properties 2,419 - 16,932 -
Right-of-use assets - 12,640 - -

12,090 16,171 23,322 -

22 ASSETS AND LIABILITIES OF DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE

(a) Assets and liabilities of disposal group classified as held for sale during the financial year

On 24 August 2023, the Group has decided to divest its trading businesses, namely WDG Resources
Sdn. Bhd. and Syn Tai Hung Trading Sdn. Bhd..

Pursuant to MFRS 5 “Non-current Assets Held for Sale and Discontinued Operations”, the Trading
segment was classified as “Discontinued Operations” in the statements of profit or loss, and the
associated assets and liabilities of the subsidiaries has been classified as assets and liabilities of
disposal group classified as held for sale in the statements of financial position.

Accordingly, the statements of profit or loss of the preceding corresponding financial year ended 31
December 2022 was re-presented to reflect the discontinued activities.

Details of the disposal group classified as held for sale are as follows:

Group
2023
RM’000

Property, plant and equipment 702

Right-of-use assets 872
Inventories 19,817
Contract asset 498
Trade and other receivables 83,623
Tax recoverable 418
Derivative financial assets 395
Time deposits 2,500
Cash and bank balances 11,356

Total assets of disposal group classified as held for sale 120,181

Wasco Berhad 245

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

22 ASSETS AND LIABILITIES OF DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE (CONTINUED)

(a) Assets and liabilities of disposal group classified as held for sale during the financial year (continued)

Details of the disposal group classified as held for sale are as follows (continued):

Group
2023
RM’000

Lease liabilities (906)

Contract liabilities (2,393)
Trade and other payables (37,443)
Provision for warranties (72)
Loans and borrowings (60,762)

Total liabilities of disposal group classified as held for sale (101,576)

The financial performance and cash flow information of the trading segment classified as
discontinued operation are as follow:

Group
2023 2022
RM’000 RM’000

Revenue 378,893 320,437

Cost of sales (356,034) (297,837)

Gross profit 22,859 22,600

Other operating income 3,399 7,015
Selling and distribution expenses (5,326) (5,605)
Administrative and general expenses (11,693) (14,858)
Reversal/(Loss) of impairment on financial assets 281 (209)
Other gain - net 398 277
Finance costs (3,773) (2,082)

Profit before tax 6,145 7,138

Tax (expense)/credit (1,440) 33

Profit from discontinued operations 4,705 7,171

Net cash inflow/(outflow) from operating activities 30,756 (34,490)

Net cash inflow from investing activities 16,409 33,001
Net cash (outflow)/inflow from financing activities (51,833) 2,825

Net changes in cash and cash equivalent (4,668) 1,336

246 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

22 ASSETS AND LIABILITIES OF DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE (CONTINUED)

(b) Assets and liabilities of disposal group classified as held for sale in the previous financial year

On 10 October 2022, the Company’s indirect wholly-owned subsidiary, Wasco China International
Limited (“WCIL”) entered into a sale and purchase agreement for the disposal of the Company’s
indirect 65% owned subsidiaries, Ashburn International Trade (Tianjin) Co. Ltd. and Ashburn Offshore
Oil & Gas Equipment & Engineering (Tianjin) Co. Ltd. for a consideration of RMB8,500,000 (equivalent
to approximately RM5,700,000).

On 21 December 2023, WCIL completed the disposal of the said subsidiaries by fulfilling condition
precedent as stipulated in the sale and purchase agreement. Accordingly, the carrying amount of the
said assets and liabilities of the subsidiaries was derecognised as assets and liabilities of disposal
group held for sale, no gain nor loss was recognised in the statement of profit or loss.

Details of the completed disposal and the net cash flow on disposal are as follows:

At the date of
disposal
RM’000

Total assets of disposal group classified as held for sale 24,659

Total liabilities of disposal group classified as held for sale (18,959)

Group’s share of net assets disposed 5,700

Net disposal proceeds 5,700

Net loss on disposal before reclassification of foreign currency translation reserve -

Reclassification of foreign currency translation reserve to profit or loss 218

Net gain on disposal 218

Net disposal proceeds 5,700

Less: Net disposal proceeds receivables (1,772)

Proceeds from disposal of subsidiaries 3,928

Wasco Berhad 247

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

22 ASSETS AND LIABILITIES OF DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE (CONTINUED)

(b) Assets and liabilities of disposal group classified as held for sale in the previous financial year
(continued)

Details of the disposal group classified as held for sale in the previous financial year are as follows:

Group
2022
RM’000

Property, plant and equipment 139

Inventories 1,473
Trade and other receivables 11,140
Tax recoverable 66
Cash and bank balances 11,841

Total assets of disposal group classified as held for sale 24,659

Trade and other payables (14,589)

Current tax liabilities (2)
Dividend payable (4,368)

Total liabilities of disposal group classified as held for sale (18,959)

23 SHARE CAPITAL

Group and Company

2023 2022
Number Carrying Number Carrying
of shares value of shares value
’000 RM’000 ’000 RM’000

Issued and fully paid:

Ordinary shares with no-par value at
1 January/31 December 774,888 547,690 774,888 547,690

The holders of ordinary shares (except treasury shares) are entitled to receive dividends as and when
declared by the Company. All ordinary shares carry one vote per share and rank equally with regard to the
Company’s residual assets.

248 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

24 TREASURY SHARES

Group and Company

2023 2022
Number Number
of shares Amount of shares Amount
’000 RM’000 ’000 RM’000

At 1 January/31 December 577 624 577 624

25 TRADE AND OTHER PAYABLES

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Current

Trade payables 158,450 180,465 - -

Other payables and accruals 424,736 293,243 1,148 7,337
Deposit from customers 12,426 47,243 - -
Provision for gratuity - 12,720 - 12,720

595,612 533,671 1,148 20,057

Non-current

Provision for gratuity 22,605 18,303 - -

Other liabilities 27,920 10,889 - -

50,525 29,192 - -

Provision for gratuity relates to gratuity provision for key management personnel. The movement of the
provision during the financial year is as follows:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

At 1 January 31,023 28,054 12,720 11,640

Additions 3,977 2,519 31 1,080
Utilised (12,751) - (12,751) -
Effect of exchange rate changes 356 450 - -

At 31 December 22,605 31,023 - 12,720

Wasco Berhad 249

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

25 TRADE AND OTHER PAYABLES (CONTINUED)

The Group’s trade payables exposure to foreign currency (a currency which is other than the functional
currency of the Group entities) risk were:

Group
2023 2022
RM’000 RM’000

- Qatari Rial 18,020 13,521

- Indonesian Rupiah 17,889 7,392
- United States Dollar 12,187 36,402
- Singapore Dollar 7,081 8,859
- Euro Dollar 4,823 3,109
- Japanese Yen 2,747 2,079
- British Pound 173 449

62,920 71,811

The Group’s other payables exposure to foreign currency (a currency which is other than the functional
currency of the Group entities) risk were:

Group
2023 2022
RM’000 RM’000

- United States Dollar 154,169 59,913

- Qatari Rial 23,496 19,336
- Indonesian Rupiah 11,732 11,054
- Singapore Dollar 7,541 3,510
- Euro Dollar 7,394 1,937
- British Pound 437 44

204,769 95,794

250 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

26 LOANS AND BORROWINGS

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Current

Unsecured
Revolving credits 452,029 473,046 45,000 59,714
Trade financing 147,448 188,624 - -
Term loans 32,248 25,543 - -
Fixed rate notes 20,321 20,868 - -

652,046 708,081 45,000 59,714

Non-current

Unsecured
Term loans 50,916 81,885 - -

702,962 789,966 45,000 59,714

The remaining maturities of the loans and borrowings are as follows:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Within 1 year 652,046 708,081 45,000 59,714

More than 1 year and less than 2 years 29,992 27,795 - -
More than 2 years and less than 5 years 20,924 54,090 - -

702,962 789,966 45,000 59,714

Wasco Berhad 251

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

26 LOANS AND BORROWINGS (CONTINUED)

The Group’s and the Company’s loans and borrowings exposure to foreign currency (a currency which is
other than the functional currency of the Group entities and the Company) risk were:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

- United States Dollar 15,689 16,177 - 9,714

- Singapore Dollar 3,552 3,478 - -
- Australian Dollar 608 - - -
- Euro Dollar - 389 - -

19,849 20,044 - 9,714

The effective interest rates of loans and borrowings of the Group are as follows:

Group Company
2023 2022 2023 2022
% % % %

Revolving credits 0.97 – 8.65 0.97 – 8.01 5.05 – 7.51 3.11 – 7.36
Term loans 5.02 – 9.43 2.37 – 8.47 - -
Trade financing 4.24 – 7.15 1.77 – 6.60 - -
Fixed rate notes 8.00 6.20 - -

252 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

26 LOANS AND BORROWINGS (CONTINUED)

The net exposure of loans and borrowings to cash flow risk and fair value risk in the periods in which they
mature or reprice (whichever is earlier) are as follows:

Fixed
Total interest rate
carrying (Fair value Floating interest rate
amount risk) (Cash flow risk)
<1 year <1 year 1 – 2 years 2 – 5 years
RM’000 RM’000 RM’000 RM’000 RM’000

2023

Group

Unsecured
Revolving credits 452,029 - 452,029 - -
Term loans 83,164 - 32,248 29,992 20,924
Trade financing 147,448 - 147,448 - -
Fixed rate notes 20,321 20,321 - - -

702,962 20,321 631,725 29,992 20,924

Company

Unsecured
Revolving credits 45,000 - 45,000 - -

2022

Group

Unsecured
Revolving credits 473,046 - 473,046 - -
Term loans 107,428 - 25,543 27,795 54,090
Trade financing 188,624 - 188,624 - -
Fixed rate notes 20,868 20,868 - - -

789,966 20,868 687,213 27,795 54,090

Company

Unsecured
Revolving credits 59,714 - 59,714 - -

Wasco Berhad 253

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

27 PROVISION FOR WARRANTIES

Group
2023 2022
RM’000 RM’000

At 1 January 22,687 12,438

Additions 17,373 14,799
Utilisation (1,043) (676)
Reversal (4,213) (4,339)
Transfer to liabilities of disposal group (72) -
Effect of exchange rate changes 778 465

At 31 December 35,510 22,687

The Group recognises the estimated liability to repair or replace products when the underlying products or
services are sold. It is expected that most of these costs will be incurred over the warranty period which
extends up to 4 years (2022: 4 years).

28 GROSS REVENUE

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-
presented)

Revenue from contracts with customers

Contract revenue 2,204,292 2,029,384 - -
Sale of goods 380,090 332,168 - -
Management fees - 8 3,973 6,819

2,584,382 2,361,560 3,973 6,819

Revenue from other sources

Rental income 21,306 4,521 - -
Dividend income - - 21,302 22,440
Interest income - - 1,323 949

21,306 4,521 22,625 23,389

2,605,688 2,366,081 26,598 30,208

254 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

28 GROSS REVENUE (CONTINUED)

Revenue from contracts with customers is represented by:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-
presented)

Timing of revenue recognition

- Over time 2,156,460 2,050,130 3,973 6,819
- At a point in time 427,922 311,430 - -

2,584,382 2,361,560 3,973 6,819

29 COST OF SALES

Group
2023 2022
RM’000 RM’000
(Re-
presented)

Contract costs 1,857,055 1,731,945

Cost of goods sold 291,653 244,133
Direct operating costs relating to rental income 11,140 1,025

2,159,848 1,977,103

30 OTHER LOSSES - NET

Group
2023 2022
RM’000 RM’000
(Re-
presented)

Fair value losses arising from fair value changes of:

- Derivative financial instruments - forward currency contracts 1,374 2,422

Wasco Berhad 255

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

31 MATERIAL PROFIT OR LOSS ITEMS

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-
presented)

Profit from operations is stated after charging:

Raw materials consumed 909,186 929,764 - -

Subcontracting cost 234,140 230,876 - -
Cost of trading goods and services 291,653 244,133 - -
Staff costs (Note 40) 472,703 383,717 1,147 9,369
Auditors’ remuneration:
Fees for statutory audits
- PricewaterhouseCoopers PLT 985 997 93 93
- member firms of PricewaterhouseCoopers
International Limited 922 1,082 - -
- others 950 752 - -
Fees for non-audit services
- PricewaterhouseCoopers PLT* 362 392 13 13
- member firms of PricewaterhouseCoopers
International Limited 1,290 1,548 - -
Depreciation charge of
- property, plant and equipment 55,800 41,178 138 156
- right-of-use assets 25,605 27,570 - -
Impairment loss on:
- property, plant and equipment 1,847 - - -
- investment properties 19 - - -
- trade receivables 2,003 8,137 - -
- other receivables - 301 - -
- amounts owing by associates - 21,378 - -
- amounts owing by joint venture 8,065 - - -
- amounts owing by subsidiaries - - 27 2,560
- investment in subsidiaries - - 3,789 4,656
- investment in an associate - 39,537 - -
- investment in a joint venture - 8,989 - -
Allowance on slow moving and obsolete
inventories 495 2,920 - -
Loss on disposal of property, plant and
equipment 318 481 - -
Loss on foreign currency exchange:
- realised 6,077 10,433 - 2,761
- unrealised 5,964 7,703 132 97

256 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

31 MATERIAL PROFIT OR LOSS ITEMS (CONTINUED)

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-
presented)

and crediting:

Gain on disposal of:

- property, plant and equipment 539 156 56 -
- assets classified as held for sale 23,095 5,150 - -
Gain on foreign exchange:
- realised 5,603 7,292 175 -
- unrealised 9,176 15,754 - -
Interest income 4,018 3,312 1,323 949
Reversal of impairment loss on:
- trade receivables 7,778 1,497 - -
- amounts owing by associates 10,216 108 - 43
- amounts owing by subsidiaries - - 2,469 -
Reversal of allowance on slow moving and
obsolete inventories 1,408 310 - -
Government grants relating to income** - 697 - -

** Government grants were introduced by the local government in various countries of which the Group
operates from. This is a government subsidy granted to assist corporations who are economically
impacted by the Covid-19 pandemic, with certain criteria to be met.

32 FINANCE COSTS

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-
presented)

Interest expense on:

- loans and borrowings 47,106 30,146 3,812 4,097
- lease liabilities 11,631 11,629 - -
- discounting factor on long term deposits - 1,520 - -

58,737 43,295 3,812 4,097

Wasco Berhad 257

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

33 TAX EXPENSE

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-
presented)

Current tax:
- Malaysian income tax 22,873 13,538 341 494
- Foreign taxation 21,325 39,523 - -

44,198 53,061 341 494

Deferred taxation 23,935 (14,137) 4,324 (368)

68,133 38,924 4,665 126

Current tax:
- Current financial year 42,989 47,850 - 539
- Under/(Over) provision in prior financial years 1,209 5,211 341 (45)

44,198 53,061 341 494

Deferred taxation
- Origination and reversal of temporary
differences 23,935 (14,137) 4,324 (368)

Tax expense recognised in profit or loss 68,133 38,924 4,665 126

258 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

33 TAX EXPENSE (CONTINUED)

The numerical reconciliation between the tax expense and the product of accounting profit multiplied by
the statutory tax rate is as follows:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-
presented)

Profit before tax 218,256 74,883 17,155 4,374

Calculated at the Malaysian tax rate of 24%

(2022: 24%) 52,381 17,972 4,117 1,050
Expenses not deductible for tax purposes 38,418 34,595 995 4,507
Income not subject to tax (15,339) (6,247) (5,112) (5,386)
Utilisation of previously unrecognised tax
losses and unabsorbed capital allowances (15,218) (17,496) - -
Current financial year deferred tax assets not
recognised 2,700 3,843 - -
Recognition of previously unrecognised
deferred tax assets - (14,467) - -
Reversal of previously recognised deferred
tax assets 6,723 - 4,324 -
Utilisation of tax incentives (170) (170) - -
Effect of different tax rates in other countries (2,049) 10,058 - -
Under/(Over) provision in prior financial years 1,209 5,211 341 (45)
Share of associates and joint ventures results (1,372) 5,518 - -
Others 850 107 - -

Tax expense recognised in profit or loss 68,133 38,924 4,665 126

Wasco Berhad 259

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

34 EARNINGS/(LOSS) PER SHARE ATTRIBUTABLE TO OWNERS OF THE COMPANY

The basic earnings per share for the financial year has been calculated by dividing the Group’s profit
attributable to owners of the Company for the financial year of RM108,402,000 (2022: loss of
RM6,300,000) by the weighted average number of ordinary shares in issue, after adjusting on the effects
of treasury shares during the financial year.

Weighted average number of shares

Group
2023 2022
’000 ’000

Issued ordinary shares at 1 January 774,888 774,888

Effect of treasury shares (577) (577)

Weighted average number of ordinary shares in issue 774,311 774,311

Basic/diluted earnings/(loss) per ordinary share (sen) 14.00 (0.81)

As there are no potential ordinary shares issued by the Company, thus there is no dilution in earnings per
share.

35 DIVIDENDS

There were no dividends paid or declared in respect of the financial year ended 31 December 2023 and
31 December 2022.

36 DISPOSAL OF A SUBSIDIARY

On 1 April 2023, Wasco Coatings Limited, an indirect wholly-owned subsidiary of the Company disposed
455,000 ordinary shares, representing 91% equity interest in Wasco Infra Services Sdn. Bhd. (“WIS”), an
indirect 91% owned subsidiary of the Company for a total cash consideration of RM200,000.

Accordingly, WIS and its subsidiary, Eco Consortium Sdn. Bhd. ceased to be subsidiaries of the Company.

260 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

36 DISPOSAL OF A SUBSIDIARY (CONTINUED)

Details of the disposal and the net cash flow on disposal are as follows:

At the date of
disposal
RM’000

Property, plant and equipment 72

Other receivables 29
Other payables (42)
Non-controlling interests 446

Group’s share of net assets disposed 505

Less: Net disposal proceeds (200)

Net loss on disposal 305

Net disposal proceeds received in cash 200

Less: Cash and bank balances of subsidiary disposed -

Net cash inflow on disposal 200

37 ACQUISITION OF SUBSIDIARIES

Acquisition of subsidiaries in the previous financial year

On 29 April 2022, Wasco Engineering Group Limited (“WEGL”), an indirect wholly-owned subsidiary of
the Company entered into a Share Sale Agreement (“SSA”) with MMA Offshore Asia Pte. Ltd., for the
acquisition of 100% equity interests in MMA Offshore Holdings Pte. Ltd. (“MMA Offshore Holdings”)
and MMA Offshore Investments Pte. Ltd. (“MMA Offshore Investments”) for a total consideration of
USD15,000,000 (equivalent to approximately RM65,397,000) plus the Working Capital Amount (“Purchase
price”), subject to the terms and conditions as stipulated in the SSA (“Sale Shares”).

Pursuant to the SSA, upon completion of the Sale Shares, PT Jaya Asiatic Shipyard (“PT Jaya”), a
subsidiary of MMA Offshore Holdings and MMA Offshore Investments shall become an indirect wholly-
owned subsidiary of the Company through WEGL.

On 1 December 2022, the acquisition was completed with the final instalment of the Purchase Price being
paid in accordance to the terms of the SSA.

Wasco Berhad 261

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

37 ACQUISITION OF SUBSIDIARIES (CONTINUED)

Acquisition of subsidiaries in the previous financial year (continued)

Details of the acquisition and the net cash flow on acquisition were as follows:

At the date of
acquisition
RM’000

Right-of-use assets 67,531

Inventories 2
Trade and other receivables 126
Cash and bank balances 6,099

73,758
Less:
Trade and other payables 111
Current tax liabilities 603
Deferred tax liabilities 281

995

Total identifiable net assets acquired 72,763

Less: Transaction costs (1,276)

Net assets acquired 71,487

Total consideration paid in cash 71,487

Less: Cash and cash equivalents of subsidiary acquired (6,099)

Net cash outflow of the Group on acquisition 65,388

262 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

38 RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES

Total
liabilities
Fixed from
Lease rate Other bank financing
liabilities Term loans notes borrowings activities
RM’000 RM’000 RM’000 RM’000 RM’000

Group

2023

At 1 January 236,607 107,428 20,868 661,670 1,026,573

Cash flows (33,637) (25,832) (1,396) (19,695) (80,560)
Non-cash item 22,088 - - - 22,088
Transfer to assets of disposal
group classified as held for
sale (906) - - (60,762) (61,668)
Effect of exchange rate
changes 2,723 1,568 849 18,264 23,404

At 31 December 226,875 83,164 20,321 599,477 929,837

2022

At 1 January 243,067 190,964 19,722 543,708 997,461

Cash flows (28,328) (89,970) - 96,150 (22,148)
Non-cash item 18,460 396 - - 18,856
Effect of exchange rate
changes 3,408 6,038 1,146 21,812 32,404

At 31 December 236,607 107,428 20,868 661,670 1,026,573

Wasco Berhad 263

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

38 RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES (CONTINUED)

Total
Net liabilities
advances from
from Other bank financing
subsidiaries borrowings activities
RM’000 RM’000 RM’000

Company

2023

At 1 January 32,400 59,714 92,114

Cash flows 488 (14,766) (14,278)
Effect of exchange rate changes - 52 52

At 31 December 32,888 45,000 77,888

2022

At 1 January 34,258 102,163 136,421

Cash flows (1,858) (42,449) (44,307)

At 31 December 32,400 59,714 92,114

39 SIGNIFICANT RELATED PARTY DISCLOSURES

For the purposes of these financial statements, parties are considered to be related to the Group if the
Group or the Company has the ability, directly or indirectly, to control the party or exercise significant
influence over the party in making financial and operating decisions, or vice versa, or where the Group
or the Company and the party are subject to common control or common significant influence. Related
parties may be individuals or other entities.

Key management personnel are defined as those persons having authority and responsibility for planning,
directing and controlling the activities of the Group either directly or indirectly.

264 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

39 SIGNIFICANT RELATED PARTY DISCLOSURES (CONTINUED)

In addition to related party disclosures mentioned elsewhere in the financial statements, set out below are
other significant related party transactions. The transactions described below were carried out on agreed
terms.

Group
2023 2022
RM’000 RM’000

Significant transactions with companies in which a Director of the Company,

Dato’ Seri Robert Tan Chung Meng, has interest

Rental of premises paid/payable 898 867

Facilities paid/payable 105 61

Significant transactions with an associate

Lease rental income of equipment 20,108 -

Company
2023 2022
RM’000 RM’000

Significant transactions with subsidiaries

Dividend income:
- Wasco Process Engineering Sdn. Bhd. (formerly known as Jutasama
Sdn. Bhd.) 12,190 17,691
- Petro-Pipe Industrial Corporation Sdn. Bhd. 9,000 4,749
- Petro-Pipe Industries (M) Sdn. Bhd. 112 -

Rental income:
- Syn Tai Hung Trading Sdn. Bhd. 281 257

Wasco Berhad 265

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

39 SIGNIFICANT RELATED PARTY DISCLOSURES (CONTINUED)

Company
2023 2022
RM’000 RM’000

Significant transactions with subsidiaries (continued)

Interest income:
- WSC Capital Sdn. Bhd. 688 140
- Triple Cash Sdn. Bhd. 243 185
- Wasco Coatings Malaysia Sdn. Bhd. 110 -
- WDG Resources Sdn. Bhd. 40 284
- Wah Seong Management Services Sdn. Bhd. 51 200

Finance cost:
- Petro-Pipe Industrial Corporation Sdn. Bhd. 953 -
- Petro-Pipe Industries (M) Sdn. Bhd. 77 500

Management fees receivables:

- Wasco Management Services Sdn. Bhd. 1,450 2,486
- Syn Tai Hung Trading Sdn. Bhd. 789 1,352
- Wasco Process Engineering Sdn. Bhd. (formerly known as Jutasama
Sdn. Bhd.) 730 1,250
- Wasco AgroTech Sdn. Bhd. (formerly known as PMT Industries Sdn. Bhd.) 561 962
- Wasco Thermal Sdn. Bhd. (formerly known as Mackenzie Industries
Sdn. Bhd.) 191 327
- WDG Resources Sdn. Bhd. 164 282
- Maple Sunpark Sdn. Bhd. 44 76
- Sunrise Green Sdn. Bhd. 44 76

Management fees payables:

- Wasco Management Services Sdn. Bhd. 3,724 2,050

266 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

39 SIGNIFICANT RELATED PARTY DISCLOSURES (CONTINUED)

Company
2023 2022
RM’000 RM’000

Significant transactions with subsidiaries (continued)

Advances to subsidiaries:
- WSC Capital Sdn. Bhd. 29,100 20,378
- Wasco Coatings Service Sdn. Bhd. 5,000 -
- Wasco Coatings Malaysia Sdn. Bhd. 5,000 -
- Wasco Pipe (Sabah) Sdn. Bhd. (formerly known as Petro-Pipe (Sabah)
Sdn. Bhd.) 5,000 -
- Sunrise Green Sdn. Bhd. - 80

Repayments from subsidiaries:

- WSC Capital Sdn. Bhd. (21,027) (18,051)
- Wasco Coatings Service Sdn. Bhd. (5,000) -
- Wasco Coatings Malaysia Sdn. Bhd. (5,000) -
- Wasco Pipe (Sabah) Sdn. Bhd. (formerly known as Petro-Pipe (Sabah)
Sdn. Bhd.) (5,000) -
- WDG Resources Sdn. Bhd. (2,400) (9,023)
- Wah Seong Management Services Sdn. Bhd. (2,550) (4,037)
- Sunrise Green Sdn. Bhd. - (953)

Advances from subsidiaries:

- Petro-Pipe Industrial Corporation Sdn. Bhd. (33,000) -
- WSC Capital Sdn. Bhd. (9,689) (28,962)
- Petro-Pipe Industries (M) Sdn. Bhd. (3,500) -
- Maple Sunpark Sdn. Bhd. (1,200) -
- Wasco AgroTech Sdn. Bhd. (formerly known as PMT Industries Sdn. Bhd.) - (8,000)
- Wasco Process Engineering Sdn. Bhd. (formerly known as Jutasama
Sdn. Bhd.) - (7,000)

Repayments to subsidiaries:
- Petro-Pipe Industries (M) Sdn. Bhd. 23,500 -
- WSC Capital Sdn. Bhd. 9,689 28,962
- Syn Tai Hung Trading Sdn. Bhd. 2,400 1,858
- Maple Sunpark Sdn. Bhd. 1,200 -
- Wasco AgroTech Sdn. Bhd. (formerly known as PMT Industries Sdn. Bhd.) - 8,000
- Wasco Process Engineering Sdn. Bhd. (formerly known as Jutasama
Sdn. Bhd.) - 7,000

Wasco Berhad 267

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

39 SIGNIFICANT RELATED PARTY DISCLOSURES (CONTINUED)

Significant outstanding balances with related parties at the financial year end are as follows:

Company
2023 2022
RM’000 RM’000

Amounts due from/(to) subsidiaries:

- WSC Capital Sdn. Bhd. 10,563 2,354
- Triple Cash Sdn. Bhd. 5,474 5,574
- WDG Resources Sdn. Bhd. 40 2,605
- Wasco Process Engineering Sdn. Bhd. (formerly known as Jutasama
Sdn. Bhd.) 4 7,823
- Petro-Pipe Industrial Corporation Sdn. Bhd. (33,350) -
- Wasco Management Services Sdn. Bhd. (2,072) 179
- Wah Seong Management Services Sdn. Bhd. - 2,469
- Wasco AgroTech Sdn. Bhd. (formerly known as PMT Industries Sdn. Bhd.) - 181
- Petro-Pipe Industries (M) Sdn. Bhd. - (20,000)
- Syn Tai Hung Trading Sdn. Bhd. - (2,409)

Compensation of key management personnel are as follows:

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Key management personnel:

- short-term employee benefits (including
monetary value of benefits-in-kind) 12,932 12,009 - 3,896
- post-employment benefits 658 932 - 454

In addition to the amounts disclosed above, the Group and the Company made a provision of
RM3,977,000 and RM31,000 (2022: a provision of RM2,519,000 and RM1,080,000) respectively for
amounts payable to key senior management at the end of their employment for their services to the
Group and the Company as part of their employment contract. With this, the total compensation to key
management personnel (including unpaid gratuity provision) amounted to RM17,567,000 and RM31,000
(2022: RM15,460,000 and RM5,430,000) for the Group and the Company respectively.

268 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

40 STAFF COSTS

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-
presented)

Salaries, wages and bonus 456,550 369,122 980 8,441

Defined contribution plan 16,153 14,595 167 928

472,703 383,717 1,147 9,369

Included within staff costs are remuneration of Executive Directors of the Group and the Company (Note
41).

41 DIRECTORS’ REMUNERATION

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Executive Directors
Salaries, wages and bonus 5,769 5,958 - 2,160
Defined contribution plan 316 474 - 260
Directors’ fees 60 120 60 120
Directors’ allowances 6 24 6 24

6,151 6,576 66 2,564

Non-Executive Directors
Salaries, wages and bonus 1,983 - 1,983 -
Defined contribution plan 238 - 238 -
Directors’ fees 470 410 470 410
Directors’ allowances 172 192 172 192

2,863 602 2,863 602

9,014 7,178 2,929 3,166

The estimated monetary value of benefits-in-kind received and receivable by Directors of the Group and
the Company are RM261,000 (2022: RM76,000) and RM Nil (2022: RM45,000) respectively.

In addition to the amounts disclosed above, the Group and the Company have made a provision of
RM3,899,000 and RM Nil (2022: provision of RM2,400,000 and RM1,080,000) respectively for amounts
payable to executive directors at the end of their employment for their services to the Group and the
Company as part of their employment contract. With this, the total remuneration (including unpaid gratuity
provision) amounted to RM10,692,000 and RM708,000 (2022: RM9,578,000 and RM4,246,000) for the
Group and the Company respectively.

Wasco Berhad 269

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

42 CAPITAL COMMITMENTS

Capital expenditure as at the reporting date is as follows:

Group
2023 2022
RM’000 RM’000

Commitment to acquire property, plant and equipment not provided for

in the financial statements:

Approved and contracted 47,037 14,525

43 SEGMENTAL ANALYSIS

For management purposes, the Group is organised into business units based on their products and
services. During the financial year, the operating segments of the Group have been restructured to reflect
its current management and operational structure. Correspondingly the comparative presentations have
been reclassified.

The Group’s operating segments comprise:

(a) Energy services division: Pipe coating, pipe manufacturing for the oil and gas industry, building
and operating offshore/onshore field development facilities and the provision of highly specialised
equipment and services to the power generation, oleochemical and petrochemical industries.

(b) Bioenergy services division: Supplier and manufacturer of specialised equipment for biomass power
plants; such as industrial fans, boilers and turbines that run primarily on biomass fuels.

(c) Trading division: Trading and distribution of building materials and the manufacturing and trading
of industrial pipes for the construction industry. During the financial year, the Group has decided to
divest its Trading businesses. Accordingly, the trading segment has been classified as “Discontinued
operations”. See Note 22(a) for details.

(d) Others: All other units within the Group that do not constitute a separately reportable segment.

Management monitors the operating results of its divisions separately for the purpose of making decisions
about resource allocation and performance assessment. Segment performance is evaluated based on
revenue and profitability measures as shown in the table below.

Transactions between segments were entered into in the normal course of business and were established
on agreed terms. The effects of such inter-segmental transactions are eliminated on consolidation.

The assets are allocated based on the operations of the respective segments. The amounts provided to
the Group Chief Executive Officer with respect to total assets are measured in a manner consistent with
the disclosure of segment assets below.

270 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

43 SEGMENTAL ANALYSIS (CONTINUED)

Energy Bioenergy
Services Services Others Total
RM’000 RM’000 RM’000 RM’000

RESULTS

Financial year ended 31 December 2023

Revenue 2,316,817 288,844 17,034 2,622,695
Less: Inter-segment revenue - - (17,007) (17,007)

External revenue 2,316,817 288,844 27 2,605,688

Segment profit/(loss) 216,197 47,867 (8,311) 255,753

Share of results of associates - - 16,307 16,307
Share of results of joint ventures 1,083 571 (13,423) (11,769)

217,280 48,438 (5,427) 260,291

Unallocated expenses relating to financing

activities (24,148)
Unallocated corporate expenses (17,887)

Profit before tax 218,256

TOTAL ASSETS

As at 31 December 2023
Segment assets 2,338,107 227,184 50,814 2,616,105
Investment in associates - - 112,742 112,742
Investment in joint ventures 3,578 4,460 12,142 20,180
Assets classified as held for sale - 7,300 4,790 12,090

2,341,685 238,944 180,488 2,761,117

Unallocated corporate assets
- Assets of disposal group classified as held
for sale 120,181
- Deferred tax assets 26,719
- Tax recoverable 15,478
- Cash and cash equivalents 22,491
- Others 664

2,946,650

Wasco Berhad 271

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

43 SEGMENTAL ANALYSIS (CONTINUED)

Energy Bioenergy
Services Services Others Total
RM’000 RM’000 RM’000 RM’000

OTHER INFORMATION

Financial year ended 31 December 2023

Depreciation of:
- Property, plant and equipment 52,355 2,293 1,152 55,800
- Investment properties - - 195 195
- Right-of-use assets 24,618 67 920 25,605

Additions of:
- Property, plant and equipment 120,059 3,932 3,542 127,533

Loss/(Reversal) of impairment on:

- Property, plant and equipment 1,847 - - 1,847
- Investment properties - - 19 19
- Receivables (4,490) (1,285) - (5,775)
- Amount owing from associate (10,216) - - (10,216)
- Amount owing from joint venture 8,065 - - 8,065

Reversal on slow moving and obsolete

inventories (201) (712) - (913)

Write-off on:
- Property, plant and equipment 4 5 120 129
- Receivables 105 1 - 106
- Inventories 236 157 - 393

Interest income (2,461) (683) (874) (4,018)

Interest expense
- Loans and borrowings 21,815 903 240 22,958
- Lease liabilities 11,524 - 107 11,631

Revenue comprise of:

- Revenue from contracts with customers 2,295,538 288,844 - 2,584,382
- Revenue from other sources 21,279 - 27 21,306
2,316,817 288,844 27 2,605,688

Revenue from contracts with customers is

represented by:

Timing of revenue recognition

- Over time 2,028,474 127,986 - 2,156,460
- At a point in time 267,064 160,858 - 427,922

2,295,538 288,844 - 2,584,382

272 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

43 SEGMENTAL ANALYSIS (CONTINUED)

Energy Bioenergy
Services Services Trading Others Total
RM’000 RM’000 RM’000 RM’000 RM’000

RESULTS

Financial year ended 31 December 2022

(Re-presented)
Revenue 2,062,317 266,555 - 50,224 2,379,096
Less: Inter segment revenue - - - (13,015) (13,015)

External revenue 2,062,317 266,555 - 37,209 2,366,081

Segment profit/(loss) 115,523 36,301 - (26,435) 125,389

Share of results of associates (12,774) - - 1,160 (11,614)
Share of results of joint ventures (6,025) 447 - (5,758) (11,336)

96,724 36,748 - (31,033) 102,439

Unallocated expenses relating to
financing activities (15,148)
Unallocated corporate expenses (12,408)

Profit before tax 74,883

TOTAL ASSETS

As at 31 December 2022
Segment assets 2,075,270 165,222 146,745 54,274 2,441,511
Investment in associates - - 298 101,520 101,818
Investment in joint ventures 3,546 3,890 - 25,264 32,700
Assets classified as held for sale - - - 16,171 16,171
Assets of disposal group classified as
held for sale - - - 24,659 24,659

2,078,816 169,112 147,043 221,888 2,616,859

Unallocated corporate assets
- Deferred tax assets 50,117
- Tax recoverable 10,590
- Cash and cash equivalents 11,432
- Others 24,452

2,713,450

Wasco Berhad 273

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

43 SEGMENTAL ANALYSIS (CONTINUED)

Energy Bioenergy
Services Services Trading Others Total
RM’000 RM’000 RM’000 RM’000 RM’000

OTHER INFORMATION

Financial year ended 31 December 2022

(Re-presented)

Depreciation of:
- Property, plant and equipment 40,057 57 - 1,064 41,178
- Investment properties - - - 222 222
- Right-of-use assets 26,550 67 - 953 27,570

Additions of:
- Property, plant and equipment 34,009 2,049 169 418 36,645

Loss/(Reversal) of impairment on:

- Receivables 5,488 1,453 - - 6,941
- Amount owing from associate 21,378 - - (108) 21,270
- Investment in associate 39,537 - - - 39,537
- Investment in joint venture 8,989 - - - 8,989

Allowance on slow moving and obsolete

inventories 2,610 - - - 2,610

Write-off on:
- Property, plant and equipment 893 14 - 1 908
- Inventories 75 385 - - 460
- Receivables 71 25 - 23 119

274 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

43 SEGMENTAL ANALYSIS (CONTINUED)

Energy Bioenergy
Services Services Trading Others Total
RM’000 RM’000 RM’000 RM’000 RM’000

OTHER INFORMATION (continued)

Financial year ended 31 December 2022

(Re-presented)

Interest income (2,313) (473) - (526) (3,312)

Interest expense
- Loans and borrowings 15,274 1,113 - 131 16,518
- Lease liabilities 11,576 - - 53 11,629

Revenue comprise of:

- Revenue from contracts with
customers 2,057,822 266,555 - 37,183 2,361,560
- Revenue from other sources 4,495 - - 26 4,521

2,062,317 266,555 - 37,209 2,366,081

Revenue from contracts with customers

is represented by:

Timing of revenue recognition

- Over time 1,903,932 146,198 - - 2,050,130
- At a point in time 153,890 120,357 - 37,183 311,430

2,057,822 266,555 - 37,183 2,361,560

Wasco Berhad 275

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

43 SEGMENTAL ANALYSIS (CONTINUED)

Geographical information

Revenue and non-current assets information is based on the geographical location of customers and
assets respectively as follows:

Revenue Non-current assets*

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
(Re-
presented)

Attributed to the country of domicile:

Malaysia 738,315 407,314 540,034 566,604

Attributed to foreign countries:

South East Asia excluding Malaysia 670,007 399,497 226,733 199,994

Africa 317,005 488,599 - -
Middle East 298,041 338,050 223,346 165,610
Europe 201,435 240,948 118,130 125,974
Australia 199,240 264,013 14,800 6,304
United States of America 105,715 107,896 22,455 29,712
East Asia 26,032 528 - -
Pakistan 20,955 15,816
Canada 20,829 38,663 14,231 18,959
China 5,155 35,681 3,196 3,894
Latin America - 21,996 - -
India 2,641 2,135 1,870 1,902
Others 318 4,945 328 305

2,605,688 2,366,081 1,165,123 1,119,258

* Non-current assets other than deferred tax assets.

276 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

44 FINANCIAL INSTRUMENTS BY CATEGORY

Group Company
2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000

Financial assets

Financial assets measured at fair value

through profit or loss:
- Derivative financial assets 154 82 - -

Financial assets at amortised cost:

- Trade and other receivables (excluding
prepayments and value added tax
receivables) 538,186 529,998 350 382
- Amounts owing by subsidiaries - - 16,121 18,497
- Amounts owing by associates 180 124 - -
- Amounts owing by joint ventures 23,995 31,811 - -
- Time deposits 103,181 53,081 684 1,466
- Cash and bank balances 307,163 275,929 2,915 1,801

972,705 890,943 20,070 22,146

Total 972,859 891,025 20,070 22,146

Financial liabilities

Financial liabilities measured at fair value

through profit or loss:
- Derivative financial liabilities 4,100 2,627 - -

Financial liabilities at amortised cost:

- Trade and other payables (excluding
employee benefits and value added tax
payables) 498,936 476,516 1,148 2,361
- Amounts owing to subsidiaries - - 35,433 22,410
- Amounts owing to joint ventures 7,573 3,493 - -
- Dividend payable 4,450 10,200 - -
- Loans and borrowings 702,962 789,966 45,000 59,714
- Lease liabilities 226,875 236,607 - -

1,440,796 1,516,782 81,581 84,485

Total 1,444,896 1,519,409 81,581 84,485

Wasco Berhad 277

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

45 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Group’s and the Company’s overall financial risk management objectives and policies are to ensure
that the Group and the Company create value and maximise returns for its shareholders. Financial risk
management is carried out through risk review, internal control systems, benchmarking to the industry’s
best practices and adherence to the Group’s financial risk management policies.

The main risks arising from the financial instruments of the Group and the Company are credit risk, market
risk, and liquidity risk. Management monitors the Group’s and the Company’s financial position closely with
the objective to minimise potential adverse effects on the financial performance of the Group and of the
Company.

The following sections provide details regarding the Group’s and the Company’s exposure to the above
mentioned financial risks and the objectives, policies and processes for managing these risks.

Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in
financial loss to the Group and the Company.

At the reporting date, the Group’s and the Company’s maximum exposure to credit risk is represented by
the carrying amounts of each class of financial assets recognised in the statements of financial position,
including derivative financial instruments with positive fair values.

(a) Receivables

The Group’s and the Company’s exposure to credit risk is monitored on an ongoing basis. The
Group and the Company have credit policies in place to manage the credit risk exposure. The risk is
managed through the application of the Group’s and the Company’s credit management procedures
which include the application of credit evaluations or approvals and follow up procedures.

The Group and the Company actively monitor the utilisation of credit limits to manage the risk of any
material loss from the non-performance of its counterparties.

Simplified approach for finance lease receivables, trade receivables and contract assets (including
intercompany trade balances)

The Group and the Company apply simplified approach to providing for ECL prescribed by MFRS
9, which permits the use of the lifetime expected loss provision for all finance lease receivables,
trade receivables and contract assets. The Group and the Company account for its credit risk by
appropriately providing for ECL on timely basis. In calculating credit loss rate, the finance lease
receivables, trade receivables and contract assets have been assessed based on credit risk
categories and the days past due and adjust for forward-looking information.

Financial assets are written off when there is no reasonable expectation of recovery, such as a
debtor failing to engage in a repayment plan with the Group and the Company. The Group and the
Company categorise a receivable for write off when a debtor fails to make contractual payments and
the recoverability of the receivables is remote. Where receivables have been written off, the Group
and the Company continue to engage in enforcement activity to attempt to recover the receivable
due. Where recoveries are made, these are recognised in profit or loss.

278 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

45 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)

Credit risk (continued)

(a) Receivables (continued)

General 3-stage approach for other debt instruments financial assets

ECL for other debt instruments financial assets at amortised costs, which include other receivables,
non-trade intercompany balances including amounts owing by subsidiaries, amounts owing by
associates and amounts owing by joint ventures, time deposits and cash and bank balances are
measured using general 3-stage approach.

The Group and the Company use three categories to reflect their credit risk and how the loss
allowance is determined for each of those categories. A summary of the assumptions underpinning
the Group’s and the Company’s ECL model is as follows:

Basis for
Category Group’s and Company’s definition of category
recognising ECL
Performing Debtors have a low risk of default and a strong 12 month ECL
capacity to meet contractual cash flows.
Underperforming Debtors for which there is a significant increase Lifetime ECL
in credit risk or significant increase in credit risk is
presumed if the forward-looking information and
indicators available signify impairment to debtors’
ability to repay.
Not performing Debtors’ ability to repay or likelihood of repayment Lifetime ECL (credit
is determined as fully impaired when it meets one impaired)
or more of the indicators in accounting policy
2.17(d).

Based on the above, loss allowance is measured on either 12 month ECL or lifetime ECL using a PD x
LGD x EAD methodology as follows:

l PD (“probability of default”) – the likelihood that the debtor would not be able to repay during
the contractual period;
l LGD (“loss given default”) – the percentage of contractual cash flows that will not be collected if
default happens; and
l EAD (“exposure at default”) – the outstanding amount that is exposed to default risk.

In deriving the PD and LGD, the Group and the Company consider available, reasonable and
supportive forward-looking information, such as:

l significant changes in the expected performance and behaviour of the debtor, including
changes in the payment status of debtor and changes in the business of the debtor; and
l debtor’s past history and existing market conditions.

Loss allowance is measured at a probability-weighted amount that reflects the possibility that a
credit loss occurs and the possibility that no credit loss occurs. No significant changes to estimation
techniques or assumptions were made during the reporting period.

There is no loss allowance for other financial asset at amortised cost as at 31 December 2023 and
31 December 2022, except for trade and other receivables, amounts owing by subsidiaries, amounts
owing by associates and amounts owing by joint ventures.

For movement of allowance for impairment of trade and other receivables, amounts owing by
subsidiaries, amounts owing by associates and amounts owing by joint ventures, refer to Note 14,
15(a), 16 and 17(a) respectively.

Wasco Berhad 279

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

45 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)

Credit risk (continued)

(b) Intercompany balances

The Company provides unsecured loans and advances to subsidiaries. The Company monitors the
results of its subsidiaries regularly.

As at 31 December 2023 and 31 December 2022, the maximum exposure to credit risk is
represented by their carrying amounts in the statement of financial position.

Management has taken reasonable steps to ensure that intercompany receivables are stated at
the realisable values. As at 31 December 2023 and 31 December 2022, the amounts owing by
subsidiaries were considered performing, except for certain subsidiaries. For movement of allowance
for impairment of amount owing by subsidiaries, refer to Note 15(a).

Advances to subsidiaries that are repayable on demand and interest-free are classified as amortised
cost in the Company’s financial statements because the Company’s business model is to hold and
collect the contractual cash flows and those cash flows represent solely payments of principal
and interest. The Company applied the general 3-stage approach when determining ECL for these
advances to subsidiaries.

There is no loss allowance recognised on these advances to subsidiaries as all strategies indicate
that the Company could fully recover the outstanding balance of the advances to subsidiaries.

Advances to subsidiaries in the Company’s separate financial statements are assessed on individual
basis for ECL measurement, as credit risk information is obtained and monitored based on each
advances to subsidiary.

(c) Derivative financial instruments

Transactions involving derivative financial instruments are with approved financial institutions and
reputable banks.

As at the end of the reporting period, the maximum exposure to credit risk arising from derivatives
financial assets is represented by the carrying amounts in the statement of financial position.

In view of the counterparties being reputable licensed financial institutions, management does not
expect any of the counterparties to fail to meet their obligations.

(d) Financial guarantees

The Company provides unsecured financial guarantees to banks in respect of banking facilities
granted to certain subsidiaries. The Company monitors on an ongoing basis the results of the
subsidiaries and repayment made by the subsidiaries.

The maximum exposure to credit risk amounts to RM368,960,000 (2022: RM317,053,000)

representing banking facilities utilised by the subsidiaries as at the end of the financial year.

As at 31 December 2023 and 31 December 2022, there was no indication that any subsidiary would
default on repayment.

Financial guarantees have not been recognised since the fair value on initial recognition was not
material as the probability of the subsidiaries defaulting on its banking facilities is remote.

(e) Time deposits and cash and bank balances

Time deposits and cash and bank balances are placed with approved financial institutions and
reputable banks. The likelihood of non-performance by these financial institutions is remote based on
their high credit ratings.

280 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

45 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)

Market risk

Market risk refers to the risk that changes in market prices, such as foreign exchange rates, interest rates
and prices will affect the Group’s and the Company’s financial position and cash flows.

(a) Foreign currency risk

Foreign currency risk is the risk that the fair value of future cash flows of a financial instrument will
fluctuate because of changes in foreign exchange rates.

The Group has transactional currency exposures arising from sales and purchases that are
denominated in a currency other than the functional currencies of the Group entities. The foreign
currency in relation to these transactions is mainly denominated in United States Dollar.

The Group maintains a natural hedge, whenever possible, by maintaining receivables and payables in
matching foreign currencies. Foreign exchange exposures in transactional currencies other than the
functional currencies of the operating entities are kept to an acceptable level.

The Group also uses forward currency contracts to minimise exposure on currency fluctuations for
which receipts or payments are anticipated more than one month after the Group has entered into
a firm commitment for a sale or purchase. The forward currency contracts entered are in the same
currency as the hedged item. It is the Group’s policy to negotiate the terms of the forward currency
contracts to match the terms of the hedged item to maximise its effectiveness.

At the reporting date, the Group is mainly exposed to fluctuation in the United States Dollar exchange
rate against the respective functional currencies of the Group entities. The Group considers a 5%
strengthening or weakening of the United States Dollar as a possible change.

A 5% strengthening or weakening of the United States Dollar would result in profit or loss after tax
and equity being approximately RM3,124,000 and RM11,000 (2022: RM9,466,000 and RM195,000)
higher or lower for the Group and the Company accordingly.

The Group and the Company consider that the foreign currency risk attributable to currencies other
than the United States Dollar to be insignificant.

(b) Cash flow and fair value interest rate risks

Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate
because of changes in market interest rates. Fair value interest rate risk is the risk that the fair value
of a financial instrument will fluctuate due to changes in market interest rates.

The Group’s and the Company’s exposure to interest rate risks relates primarily to the Group’s and the
Company’s time deposits and interest bearing borrowings.

Surplus funds are placed with licensed financial institutions to earn interest income based on
prevailing market rates. The Group and the Company manage its interest rate risks by placing such
funds on short tenures of 12 months or less.

The Group and the Company generally borrow principally on a floating rate basis and ensure that
interest rates obtained are competitive.

The interest rate profile of the Group’s and the Company’s significant interest-bearing financial
instrument have been presented in Notes 15, 17, 19 and 26.

Wasco Berhad 281

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

45 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)

Market risk (continued)

(b) Cash flow and fair value interest rate risks (continued)

Fair value sensitivity for fixed rate instruments

The Group does not account for any fixed rate financial assets and liabilities at fair value through
profit or loss, and the Group does not designate derivatives as a fair value hedge. Therefore, a
change in interest rates for these financial instruments at the end of the reporting period would not
affect profit or loss.

Sensitivity analysis for variable rate instruments

At the reporting date, if interest rates had been 50 basis points lower/higher, with all other variables
held constant, the Group’s and the Company’s profit or loss after tax and equity would have been
approximately RM3,335,000 and RM225,000 (2022: RM3,729,000 and RM299,000) higher/lower,
arising mainly as a result of lower/higher interest expense on floating rate borrowings. The assumed
movement in basis points for interest rate sensitivity analysis is based on the currently observable
market environment.

Liquidity risk

Liquidity risk is the risk that the Group or the Company will not be able to meet its financial obligations as
they fall due. The Group’s and the Company’s exposure to liquidity risk arises principally from its trade and
other payables and loans and borrowings. The Group and the Company maintain a level of cash and cash
equivalents and bank facilities deemed adequate by the management to ensure, as far as possible, that it
will have sufficient liquidity to meet its liabilities when they fall due.

As at 31 December 2023, there are sufficient facilities available that can be used to refinance borrowings,
capital expenditure and general working capital requirements of the Group and the Company. Details of
liquidity risk are disclosed in Note 26 to the financial statements.

282 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

45 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)

Liquidity risk (continued)

All financial liabilities of the Group and the Company that will be due and payable within the next 12
months are classified within current liabilities. The contractual cash flows of derivative financial liabilities
and non-derivative financial liabilities are presented below:

More than More than Total

1 year and 2 years and contractual Total
Within 1 less than less than More than undiscounted carrying
year 2 years 5 years 5 years cash flows amount
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group

2023

Non-derivative financial
liabilities

Lease liabilities 32,442 26,607 71,170 181,778* 311,997 226,875

Trade and other payables 483,972 14,972 - - 498,944 498,944
Amounts owing to joint
ventures 7,573 - - - 7,573 7,573
Loans and borrowings 688,846 31,950 21,927 - 742,723 702,962
Dividend payable 4,450 - - - 4,450 4,450

1,217,283 73,529 93,097 181,778 1,565,687 1,440,804

Derivative financial
liabilities

Forward currency
contracts
Gross settled
- outflow 242,561 - - - 242,561
- inflow (238,615) - - - (238,615)

3,946 - - - 3,946 3,946

1,221,229 73,529 93,097 181,778 1,569,633 1,444,750

* Lease liabilities with maturity of more than 5 years comprise of lease terms up to 9 years.

Wasco Berhad 283

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

45 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)

Liquidity risk (continued)

More than More than Total

1 year and 2 years and contractual Total
Within 1 less than less than More than undiscounted carrying
year 2 years 5 years 5 years cash flows amount
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group

2022

Non-derivative financial
liabilities

Lease liabilities 33,357 28,926 66,207 199,852* 328,342 236,607

Trade and other payables 476,516 - - - 476,516 476,516
Amounts owing to joint
ventures 3,493 - - - 3,493 3,493
Loans and borrowings 732,559 29,177 56,318 - 818,054 789,966
Dividend payable 10,200 - - - 10,200 10,200

1,256,125 58,103 122,525 199,852 1,636,605 1,516,782

Derivative financial
liabilities

Forward currency
contracts
Gross settled
- outflow 200,998 - - - 200,998
- inflow (198,371) - - - (198,371)

2,627 - - - 2,627 2,627

1,258,752 58,103 122,525 199,852 1,639,232 1,519,409

* Lease liabilities with maturity of more than 5 years comprise of lease terms up to 10 years.

284 Integrated Annual Report 2023

 Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

45 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)

Liquidity risk (continued)

Total
contractual Total
Within undiscounted carrying
1 year cash flows amount
RM’000 RM’000 RM’000

Company

2023

Non-derivative financial liabilities

Financial guarantees* 368,960 368,960 -

Other payables and accruals 1,148 1,148 1,148
Amounts owing to subsidiaries 35,433 35,433 35,433
Loans and borrowings 47,826 47,826 45,000

453,367 453,367 81,581

2022

Non-derivative financial liabilities

Financial guarantees* 317,053 317,053 -

Other payables and accruals 2,361 2,361 2,361
Amounts owing to subsidiaries 22,410 22,410 22,410
Loans and borrowings 62,840 62,840 59,714

404,664 404,664 84,485

* This represents the maximum exposure to the Company in the event that the financial guarantee
contracts issued by the Company to its subsidiaries are called upon. These liabilities have been
included in the consolidated statement of financial position of the Group and hence will not result in
any additional liability to the Group.

46 FAIR VALUES OF FINANCIAL INSTRUMENTS

The carrying amounts of financial assets and liabilities classified within current assets and current
liabilities respectively approximate their fair values due to the relatively short term nature of these financial
instruments.

The fair values of forward exchange contracts are estimated by discounting the difference between the
contractual forward price and the current forward price for the residual maturity of the contract using a
risk-free interest rate.

Fair values of non-derivative financial liabilities are calculated based on the present value of future
principal and interest cash flows, discounted at the market rate of interest at the end of the reporting
period.

Wasco Berhad 285

Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

46 FAIR VALUES OF FINANCIAL INSTRUMENTS (CONTINUED)

The carrying amount of financial liabilities measured at amortised cost approximates their respective fair
values.

Fair value hierarchy

The table below summarises all financial instruments carried at fair value as at 31 December 2023 and
31 December 2022, based on a hierarchy that reflects the significance of the inputs used in measuring its
respective fair values. The levels are defined as follows:

Level 1: Quoted prices (unadjusted) in active markets for identical financial assets or liabilities.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the financial
asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: Inputs for the financial asset or liability that are not based on observable market data
(unobservable inputs).

Group
Level 1 Level 2 Level 3 Total
RM’000 RM’000 RM’000 RM’000

2023

Financial assets/(liabilities)

Derivative financial assets - 154 - 154

Derivative financial liabilities - (4,100) - (4,100)

- (3,946) - (3,946)

2022

Financial assets/(liabilities)

Derivative financial assets - 82 - 82

Derivative financial liabilities - (2,627) - (2,627)

- (2,545) - (2,545)

47 CAPITAL MANAGEMENT

The primary objective of the Group’s capital management is to ensure that it maintains a strong credit
rating and healthy capital structure in order to continue supporting its businesses, maximise shareholders’
value and sustain future development of businesses within the Group. The Group strives to monitor and
maintain an optimal gearing ratio. The gearing ratio is calculated as net debt divided by total capital.
Net debt is calculated as loans and borrowings less time deposits, cash and bank balances. Total capital
includes paid-up share capital and reserves attributable to owners of the Company. The Group’s net
gearing ratio is 0.48 times (2022: 0.79 times).

286 Integrated Annual Report 2023

 Summary of Significant Recurrent
Related Party Transactions
A. Group Financial and/or Treasury Management

Interested Related Lender Borrower Actual Value Nature of Transaction

Party Transacted for
the Financial
Year Ended
31 December
2023
Chan Cheu Leong; Syn Tai Hung WDG Resources RM65,000,000 Guarantee granted to
Goh Eng Hooi Trading Sdn. Bhd. Sdn. Bhd. undertake outstanding
amount owing by WDG
Resources Sdn. Bhd.
in the event that WDG
Resources Sdn. Bhd.
failed to settle any
debts owing to the
suppliers and/or banks
Goh Eng Hooi is a Director of Syn Tai Hung Trading Sdn. Bhd. (“STHT”) and WDG
Resources Sdn. Bhd. (“WDG”).

Goh Eng Hooi is a Substantial Shareholder of 33.33% shareholding in Epilog

Tegap Sdn. Bhd. (“ETSB”) via Go Hotels Sdn. Bhd. and in turn ETSB holds 40%
shareholding in WDG.

Chan Cheu Leong is a Substantial Shareholder of 33.33% shareholding in ETSB via

Midvest Asia Sdn. Bhd. (“MASB”) and in turn ETSB holds 40% shareholding in WDG.

Chan Cheu Leong is the Non-Independent Non-Executive Director and a Substantial

Shareholder of 5.67% shareholding in Wasco Berhad (formerly known as Wah
Seong Corporation Berhad) (“WB”) via MASB and Midvest Properties Sdn. Bhd.
(“MPSB”). His direct shareholding in WB is 2.67%.
Chan Cheu Leong Petro-Pipe WDG Resources RM8,229,524 Interest bearing
Industrial Sdn. Bhd. advances for purpose
Corporation Sdn. of working capital
Bhd. requirement
WDG is a direct 60%-owned subsidiary of Petro-Pipe Industrial Corporation Sdn.
Bhd.

Chan Cheu Leong is a Substantial Shareholder of 33.33% shareholding in ETSB via

MASB and in turn ETSB holds 40% shareholding in WDG.

Chan Cheu Leong is the Non-Independent Non-Executive Director and a Substantial

Shareholder of 5.67% shareholding in WB via MASB and MPSB. His direct
shareholding in WB is 2.67%.

Wasco Berhad 287

Summary of Significant Recurrent
Related Party Transactions
B. Transactions of A Revenue or Trading in Nature

Interested Related Provider of Recipient of Actual Value Nature of Transaction

Party Products / Products / Transacted for
Services Services the Financial
Year Ended
31 December
2023
Dato’ Seri Robert IGB Berhad Group Wasco RM993,624 Rental of premise and
Tan Chung Meng; of companies Management related facilities
Pauline Tan Suat Services Sdn. Bhd.
Ming; Tony Tan
Dato’ Seri Robert Tan Chung Meng is the Non-Independent Non-Executive Director
Choon Keat;
of IGB Berhad (“IGB”) Group. He is also the Non-Independent Non-Executive
Tan Chin Nam
Chairman of WB Group. He is a common indirect Major Shareholder of WB and
Sendirian Berhad;
IGB. His total direct and indirect shareholdings in WB are 1.54% and 41.20%
Tan Kim Yeow
respectively. His total direct and indirect shareholdings in IGB are 0.59% and
Sendirian Berhad;
29.64% respectively.
Wah Seong
(Malaya) Trading
Pauline Tan Suat Ming is a common indirect Major Shareholder of WB and IGB. Her
Co. Sdn. Bhd.
indirect shareholding in WB is 41.48%. Her total direct and indirect shareholdings in
IGB are 0.04% and 29.64% respectively.

Tony Tan Choon Keat is a common indirect Major Shareholder of WB and IGB. His
indirect shareholding in WB is 41.20%. His indirect shareholding in IGB is 29.64%.
Tony Tan Choon Keat is the father of Tan Jian Hong, Aaron, the Non-Independent
Non-Executive Director of WB.

Tan Chin Nam Sendirian Berhad, Tan Kim Yeow Sendirian Berhad and Wah Seong
(Malaya) Trading Co. Sdn. Bhd. are common Major Shareholders of WB and IGB.

Tan Chin Nam Sendirian Berhad’s total direct and indirect shareholdings in WB
are 0.71% and 32.57% respectively. Tan Kim Yeow Sendirian Berhad’s total direct
and indirect shareholdings in WB are 8.63% and 32.57% respectively. Wah Seong
(Malaya) Trading Co. Sdn. Bhd.’s total direct and indirect shareholdings in WB are
30.92% and 1.64% respectively.

Tan Chin Nam Sendirian Berhad’s total direct and indirect shareholdings in IGB are
27.73% and 21.04% respectively. Tan Kim Yeow Sendirian Berhad’s total direct
and indirect shareholdings in IGB are 9.91% and 19.74% respectively. Wah Seong
(Malaya) Trading Co. Sdn. Bhd.’s total direct and indirect shareholdings in IGB are
15.85% and 3.88% respectively.

NOTE:

The Interested Related Party Relationships are as per the Circular to Shareholders on Proposed Renewal of
Shareholders’ Mandate for the Existing Recurrent Related Party Transactions of a Revenue or Trading Nature and
Provision of Financial Assistance dated 28 April 2023 which was approved at the Annual General Meeting of Wasco
Berhad (formerly known as Wah Seong Corporation Berhad) held on 30 May 2023.

288 Integrated Annual Report 2023

 Top 10 List of Properties
AS AT 31 DECEMBER 2023

Audited NBV
Approximate Approximate as at
Description/ age of land/ 31.12.2023
Title/Location existing use the building built-up area Tenure RM’000

Lot No 512, 513, 514, 515, Factory/Jetty/ 10 years 24 acres Freehold 89,810
1284 and 2347 Buildings
Mukim Teluk Panglima Garang
Daerah Kuala Langat
Selangor Darul Ehsan

PT 15926, Jalan Bandar Lama Factory and 4 – 7 years 8 acres

42500 Teluk Panglima Garang office building
Selangor Darul Ehsan

No. 246/SPJ/KA-AT/XI/93, No. Industrial land N/A 126,998 sqm Leasehold 22 68,187
13/PERJ-DDOPS/L/3/2009 and with office and years expiring
No.460/SPJ/KD- AT/L/VIII/2006 workshops on 21 April
Brigjend Katamso St. Km. 6, 2043
Tanjung Uncang District, Batu
Aji Sub-District, Batam City, 29,333 sqm Leasehold 25
Riau Islands Province, 29424 years expiring
on 28 February
2046

20,000 sqm Leasehold

40 years
expiring on
2 November
2048

KKIP Timor, Industrial Zone 13 Industrial land 16 years 22 acres Leasehold 51,421
General Industrial Zone with factory and (Land) 99 years
Kota Kinabalu Industrial Park office building 21,642 sq m expiring on
Mile 15 Jalan Telipok, Telipok (Building) 31 December
Kota Kinabalu, Sabah 2098

No 5 Pandan Road Office building 7 years 13,723 sq m Leasehold 38,470

Singapore 609299 28 years
expiring on
30 December
2037

Geran No 339016, 339017, Industrial land 16 years 18 acres Freehold 23,230

32544, 32546 and 32547 with office and (Land)
Lot No 126527, 15844, factory building 34,537 sq m
1930, 1944 and 1945 (Building)

Geran No 313567, Industrial land N/A 4 acres

Lot No 1943 (Land)
Daerah & Mukim of Klang
Selangor Darul Ehsan

PKNP Land Lot Fiz Industrial land N/A 36 acres Leasehold 18,015
Kawasan Perindustrian Fiz 85 years
Tg Gelang, Mukim Sg. Karang expiring on
Kuantan, Pahang Darul Makmur 19 December
2096

Wasco Berhad 289

Top 10 List of Properties
AS AT 31 DECEMBER 2023

Audited NBV
Approximate Approximate as at
Description/ age of land/ 31.12.2023
Title/Location existing use the building built-up area Tenure RM’000

PN 4460, 4461, 4462, Commercial 33 years 3,167 sq m Leasehold 6,395

4463, 37309 99 years
Lot No 487, 488, 489, expiring on
490, 20041 14 October
Seksyen 90 2076
Bandar Kuala Lumpur
No 2, 4, 6, 8 Jalan 1/75
Off Jalan Kampong Pandan
Kuala Lumpur

CL075599469 & Semi-detached 1 9 years 2,354 sq m Leasehold 2,849

CLO75599478 storey open shed (land) 99 years
Lot 3 & 4, Mile 9, workshop cum 2 557 sq m expiring on
Labuk Road, storey office (buildings) 31 December
Sandakan 2113

Lot 15479, 15480, Double storey 7 years 722 sq m Leasehold 2,158

Block 32, semi detached expiring on
Kemena Land District, industrial building 20 January
Bizhub 33, 2079
Jalan Bintulu - Miri,
Bintulu

Nusa Tenggara Barat, Land N/A 13,900 sq m Freehold 846

Lombok Barat

290 Integrated Annual Report 2023

 Analysis of
Shareholdings
Ordinary Shares

Share Capital as at 29 March 2024

Issued and Fully Paid-up Capital : RM547,690,147.00

Class of Equity Securities : Ordinary Shares
Stock Name : WASCO
Voting Rights : On a poll - one (1) vote per ordinary share held
Total Shareholders : 9,459

Distribution of Shareholders as at 29 March 2024

No. of No. of
Size of Shareholdings Shareholders % Shares %

Less than 100 2,893 30.5846 89,240 0.0115

100 - 1,000 1,788 18.9026 603,302 0.0779
1,001 - 10,000 3,270 34.5703 12,249,232 1.5808
10,001 - 100,000 1,234 13.0458 32,119,742 4.1451
100,001 to less than 5% of total number of issued shares 271 2.8650 400,556,929 51.6922
5% and above of issued share capital 3 0.0317 329,269,849 42.4925

Total 9,459 100.0000 774,888,294 100.0000

List of Substantial Shareholders as at 29 March 2024

No. of Ordinary Shares

Direct Deemed
Name of Substantial Shareholders Interest %(a) Interest %(a)

1. Wah Seong (Malaya) Trading Co. Sdn. Bhd. 239,438,739 30.9228 12,732,323(b) 1.6443
2. Midvest Asia Sdn. Bhd. 41,645,829 5.3784 2,230,900(h) 0.2881
3. Tan Kim Yeow Sendirian Berhad 66,824,250 8.6302 252,171,062(c) 32.5671
4. Pauline Tan Suat Ming - - 321,162,173(g) 41.4771
5. Tan Chin Nam Sendirian Berhad 5,529,600 0.7141 252,171,062 (c)
32.5671
6. Tony Tan Choon Keat - - 318,995,312 (d)
41.1973
7. Dato’ Seri Robert Tan Chung Meng 11,927,314 1.5404 318,995,312 (d)
41.1973
8. Chan Cheu Leong 20,677,936 2.6705 43,876,729(e) 5.6665

Wasco Berhad 291

Analysis of
Shareholdings
Directors’ Shareholdings as at 29 March 2024

No. of Ordinary Shares

Direct Deemed
Name of Directors Interest %(a) Interest %(a)

1. Dato’ Seri Robert Tan Chung Meng 11,927,314 1.5404 318,995,312(d) 41.1973
2. Gian Carlo Maccagno 4,609,055 0.5952 - -
3. Chan Cheu Leong 20,677,936 2.6705 44,011,991(f) 5.6840
4. Tan Sri Saw Choo Boon - - - -
5. Halim Bin Haji Din - - - -
6. Tan Sri Professor Lin See Yan - - - -
7. Tan Jian Hong, Aaron - - - -
8. Datin Wan Daneena Liza binti Wan Abdul Rahman - - - -
9. Lily Rozita binti Mohamad Khairi - - - -

Notes:

(a)
Based on 774,311,240 ordinary shares (Total number of issued shares of 774,888,294 ordinary shares
less Treasury Shares of 577,054).

(b)
Deemed interest held through Wah Seong Enterprises Sdn. Bhd. (“WSE”) and Karya Insaf (M) Sdn. Bhd.
(“KI”) pursuant to Section 8 of the Companies Act, 2016 (“the Act”) whereby Wah Seong (Malaya) Trading
Co. Sdn. Bhd. (“WST”) is the major shareholder of WSE and KI.

(c)
Deemed interest held through WSE, KI and WST pursuant to Section 8 of the Act.

(d)
Deemed interest held through WSE, KI, WST and Tan Kim Yeow Sendirian Berhad (“TKYSB”) pursuant to
Section 8 of the Act.

(e)
Deemed interest held through Midvest Asia Sdn. Bhd. (“MASB”) and Midvest Properties Sdn. Bhd. (“MPSB”)
pursuant to Section 8 of the Act.

(f)
Deemed interest held through MASB and MPSB pursuant to Section 8 of the Act and include interests of
his spouse and children.

(g)
Deemed interest held through WSE, KI, WST, TKYSB and PTSM Holdings Sdn. Bhd. pursuant to Section 8
of the Act.

(h)
Deemed interest held through MPSB pursuant to Section 8 of the Act.

Note :

- By virtue of his interests of more than 20% in the shares of the Company, Dato’ Seri Robert Tan Chung
Meng is also deemed to be interested in the shares of all its subsidiaries to the extent the Company has an
interest.
- TKYSB and Tan Chin Nam Sendirian Berhad are the major shareholders of WST.

292 Integrated Annual Report 2023

 Analysis of
Shareholdings
Thirty (30) Largest Shareholders as at 29 March 2024

No. Name No. of Shares %(a)

1. Wah Seong (Malaya) Trading Co. Sdn. Bhd. 235,472,770 30.4106

2. Tan Kim Yeow Sendirian Berhad 52,151,250 6.7352

3. Midvest Asia Sdn. Bhd. 41,645,829 5.3784

4. Amanahraya Trustees Berhad

Amanah Saham Bumiputera 38,364,800 4.9547

5. Lembaga Tabung Angkatan Tentera 28,961,327 3.7403

6. Tan Kim Yeow Sendirian Berhad 14,673,000 1.8950

7. Amanahraya Trustees Berhad

Amanah Saham Bumiputera 2 13,750,912 1.7759

8. Citigroup Nominees (Asing) Sdn. Bhd.

Exempt AN for Citibank New York (Norges Bank 14) 13,368,000 1.7264

9. Maybank Nominees (Tempatan) Sdn. Bhd.

Pledged Securities Account for Chan Cheu Leong 12,126,999 1.5662

10. HSBC Nominees (Asing) Sdn. Bhd.

Exempt AN for Credit Suisse (SG BR-TST-ASING) 11,947,460 1.5430

11. Robert Tan Chung Meng 11,020,134 1.4232

12. Karya Insaf (M) Sdn. Bhd. 10,130,675 1.3083

13. HSBC Nominees (Tempatan) Sdn. Bhd.

HSBC (M) Trustee Bhd for Manulife Investment Shariah Progress Fund 8,509,300 1.0990

14. Amanahraya Trustees Berhad

PMB Shariah Growth Fund 8,000,000 1.0332

15. Micasa Investments (S) Pte Ltd 7,279,564 0.9401

16. HSBC Nominees (Tempatan) Sdn. Bhd.

HSBC (M) Trustee Bhd for Manulife Investment Progress Fund (4082) 6,767,500 0.8740

17. Citigroup Nominees (Tempatan) Sdn. Bhd.

Urusharta Jamaah Sdn. Bhd. (Maybank 2) 6,733,200 0.8696

18. HSBC Nominees (Tempatan) Sdn. Bhd.

HSBC (M) Trustee Bhd for Manulife Insurance Berhad (Equity Fund) 6,426,300 0.8299

19. Citigroup Nominees (Tempatan) Sdn. Bhd.

Employees Provident Fund Board (Aberislamic) 6,157,700 0.7952

20. Tan Chin Nam Sendirian Berhad 5,529,600 0.7141

21. CIMSEC Nominees (Tempatan) Sdn. Bhd.

CIMB For Chan Cheu Leong (PB) 5,025,000 0.6490

Wasco Berhad 293

Analysis of
Shareholdings
Thirty (30) Largest Shareholders as at 29 March 2024 (continued)

No. Name No. of Shares %(a)

22. Amanahraya Trustees Berhad

PMB Shariah Aggressive Fund 4,972,600 0.6422

23. Amanahraya Trustees Berhad

Amanah Saham Nasional 4,732,722 0.6112

24. Citigroup Nominees (Asing) Sdn. Bhd.

UBS AG Singapore for Maccagno Gian Carlo 4,609,055 0.5952

25. HSBC Nominees (Tempatan) Sdn. Bhd.

HSBC (M) Trustee Bhd for Manulife Investment Al-Faid (4389) 4,413,000 0.5699

26. Citigroup Nominees (Tempatan) Sdn. Bhd.

Urusharta Jamaah Sdn. Bhd. (Aberdeen 2) 4,036,400 0.5213

27. Amanahraya Trustees Berhad

Amanah Saham Bumiputera 3 – Didik 4,000,000 0.5166

28. Wah Seong (Malaya) Trading Co. Sdn. Bhd. 3,965,969 0.5122

29. HSBC Nominees (Tempatan) Sdn. Bhd.

HSBC (M) Trustee Bhd for Principal Islamic Small Cap Opportunities Fund 3,887,400 0.5020

30. HSBC Nominees (Tempatan) Sdn. Bhd.

HSBC (M) Trustee Bhd for Manulife Insurance Berhad (Managed Fund) 3,495,400 0.4514

582,153,866 75.1834

Note:

(a)
Based on 774,311,240 ordinary shares (Total number of issued shares of 774,888,294 ordinary shares
less Treasury Shares of 577,054).

294 Integrated Annual Report 2023

 Notice of Twenty-Fourth
Annual General Meeting
NOTICE IS HEREBY GIVEN THAT the Twenty-Fourth Annual General Meeting of WASCO BERHAD (formerly
known as Wah Seong Corporation Berhad) (“the Company”) will be conducted through live streaming and
online remote participation using Remote Participation and Voting (“RPV”) Facilities as a virtual general
meeting at the Broadcasting Venue to be held at West Side 1 & 2, Level 8, St. Giles Boulevard, The Boulevard,
Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur, Wilayah Persekutuan, Malaysia on Thursday, 30
May 2024 at 3.00 p.m. for the following purposes:

AGENDA

As Ordinary Business

1. To receive the Audited Financial Statements of the Company and the Group
for the financial year ended 31 December 2023 and the Reports of the
Directors and Auditors thereon.

2. To approve the Directors’ Fees of RM679,500 and Directors’ Meeting Ordinary Resolution 1
Allowances of RM184,000 payable for the financial year ended 31 December
2023.

3. To approve the payment of Directors’ Meeting Allowances of up to an amount Ordinary Resolution 2

of RM170,000 payable for the financial year ending 31 December 2024.

4. To re-elect the following Directors who retire pursuant to Clause 117 of the
Company’s Constitution:

(i) Encik Halim Bin Haji Din Ordinary Resolution 3

(ii) Tan Sri Professor Lin See Yan Ordinary Resolution 4
(iii) Tan Sri Saw Choo Boon Ordinary Resolution 5

5. To re-appoint PricewaterhouseCoopers PLT as Auditors of the Company for Ordinary Resolution 6

the ensuing year and to authorise the Directors to fix their remuneration.

As Special Business

To consider, and if thought fit, to pass the following Ordinary Resolutions, with or
without modifications thereto:

6. Ordinary Resolution
Authority to Issue Shares by the Directors of the Company Ordinary Resolution 7

“THAT, subject always to the Companies Act, 2016 (“the Act”), the Company’s
Constitution and approvals from the relevant governmental and/or regulatory
bodies where such approvals shall be necessary, authority be and is hereby
given to the Directors of the Company pursuant to Sections 75 and 76 of
the Act, to issue and allot shares in the share capital of the Company from
time to time upon such terms and conditions and for such purposes as may
be determined by the Directors of the Company to be in the interest of the
Company provided always that the aggregate number of shares to be issued
pursuant to this resolution does not exceed 10% (ten per centum) of the total
number of issued shares (excluding treasury shares) of the Company for the
time being AND THAT the Directors of the Company be also empowered to
obtain the approval for the listing of and quotation for the additional shares
so issued on Bursa Malaysia Securities Berhad AND FURTHER THAT such
authority shall continue to be in forced until the conclusion of the next Annual
General Meeting (“AGM”) of the Company or the expiration of the period within
which the next AGM is required by law to be held, whichever is the earlier;
but an approval may be revoked or varied at any time by a resolution of the
Company in general meeting.”
Wasco Berhad 295
Notice of Twenty-Fourth
Annual General Meeting
7. Ordinary Resolution
Proposed Authority to Buy-Back its Own Shares by the Company Ordinary Resolution 8

“THAT, subject to the provisions of the Companies Act, 2016 (“the Act”), the
Company’s Constitution, the Main Market Listing Requirements (“MMLR”) of
Bursa Malaysia Securities Berhad (“Bursa Malaysia”) and any other applicable
laws, rules, orders, requirements, regulations and guidelines for the time
being in force, the Directors of the Company be hereby unconditionally and
generally authorised to purchase the Company’s own ordinary shares (“WB
Shares”) in the Company’s total number of issued shares through Bursa
Malaysia at any time and upon such terms and conditions and for such
purposes as the Directors of the Company may, in their discretion deem fit,
subject to the following:

(i) the maximum number of WB Shares which may be purchased and/or

held by the Company shall be 10% (ten per centum) of the total number
of issued shares of the Company for the time being;

(ii) the maximum fund to be allocated by the Company for the purpose of
purchasing the WB Shares shall not exceed the retained profits of the
Company as at 31 December 2023 otherwise available for distribution as
dividends;

(iii) the authority conferred by this resolution will be effective immediately

upon the passing of this resolution and will continue in force until:

(a) the conclusion of the next Annual General Meeting (“AGM”) of

the Company, at which time the authority shall lapse, unless by
ordinary resolution passed at the meeting, the authority is renewed,
either unconditionally or subject to conditions;

(b) the expiration of the period within which the next AGM after that
date is required by law to be held; or

(c) revoked or varied by an ordinary resolution passed by the

shareholders in a general meeting;

whichever is earlier but not so as to prejudice the completion of the

purchase(s) made by the Company before the aforesaid expiry date and,
in any event, in accordance with the provisions of the MMLR of Bursa
Malaysia or any other relevant authorities;

(iv) upon completion of the purchase(s) of the WB Shares by the Company,

the Directors of the Company be hereby authorised to deal with the WB
Shares in accordance with the MMLR and the Act.

AND THAT the Directors of the Company be and are hereby authorised to
take all such steps that are necessary or expedient and/or appropriate to
implement, finalise and to give full effect to the purchase(s) of WB Shares with
full power to assent to any conditions, variations, and/or amendments that
may be imposed by the relevant authorities.”

296 Integrated Annual Report 2023

 Notice of Twenty-Fourth
Annual General Meeting
8. Ordinary Resolutions
Proposed Renewal of Shareholders’ Mandate for the Existing Recurrent
Related Party Transactions and Provision of Financial Assistance

“THAT, subject to the provisions of the Main Market Listing Requirements

of Bursa Malaysia Securities Berhad, approval be and is hereby given to the
Company and/or its subsidiaries (“Wasco Group”) to enter into recurrent
related party transactions of a revenue or trading nature and the provision
of financial assistance as specified in Section 2.5 of Part B of the Circular to
Shareholders dated 26 April 2024 which transactions are necessary for the
day-to-day operations in the ordinary course of business of Wasco Group on
terms not more favourable to the related parties than those generally available
to the public and are not to the detriment of the minority shareholders of the
Company as follows:

Proposed renewal of shareholders’ mandate for the existing recurrent related

party transactions of a revenue or trading nature and the provision of financial
assistance involving:-

(a) Dato’ Seri Robert Tan Chung Meng, Madam Pauline Tan Suat Ming, Mr Ordinary Resolution 9
Tony Tan Choon Keat, Tan Chin Nam Sendirian Berhad, Tan Kim Yeow
Sendirian Berhad and Wah Seong (Malaya) Trading Co. Sdn. Bhd.
(b) Mr Goh Eng Hooi Ordinary Resolution 10
(c) Dato’ Mohamed Nizam Bin Abdul Razak and Encik Mohd Azlan Bin Ordinary Resolution 11
Mohammed

The shareholders’ mandate is subject to annual renewal and disclosure is

made in the Annual Report of the aggregate value of transactions conducted
pursuant to the shareholders’ mandate during the financial year and that such
approval shall continue to be in force until:

(i) the conclusion of the next Annual General Meeting (“AGM”) of the
Company, at which time the proposed shareholders’ mandate will lapse,
unless renewed by a resolution passed at the meeting;

(ii) the expiration of the period within which the next AGM of the Company
after the date it is required to be held pursuant to Section 340(2) of the
Companies Act, 2016 (“the Act”) (but shall not extend to such extension
as may be allowed pursuant to Section 340(4) of the Act); or

(iii) revoked or varied by resolution passed by the shareholders of the

Company in a general meeting;

whichever is earlier.

AND THAT the Directors of the Company be and are hereby authorised to
complete and to do all such acts and things (including executing all such
documents as may be required) as they may consider expedient or necessary to
give effect to the transactions contemplated and/or authorised by this resolution.”

9. To transact any other business that may be transacted at an Annual General

Meeting of which due notice shall have been given in accordance with the
Companies Act, 2016 and the Company’s Constitution.

FURTHER NOTICE IS HEREBY GIVEN THAT for the purpose of determining a member who shall be entitled to
attend this Twenty-Fourth Annual General Meeting, the Company shall be requesting Bursa Malaysia Depository
Sdn. Bhd., in accordance with Clause 88 of the Company’s Constitution and Section 34(1) of the Securities
Industry (Central Depositories) Act, 1991, to issue a Record of Depositors as at 23 May 2024 (“General Meeting
Record of Depositors”). Only a Depositor whose name appears on the General Meeting Record of Depositors
shall be regarded as a member entitled to attend, speak and vote at the Twenty-Fourth Annual General Meeting
or appoint proxy(ies) to attend, speak and vote on his/her behalf.

Wasco Berhad 297

Notice of Twenty-Fourth
Annual General Meeting
BY ORDER OF THE BOARD
WOO YING PUN (MAICSA 7001280)
SSM PC No. 201908002179
Group Company Secretary

Kuala Lumpur
Dated: 26 April 2024

Notes:

1. A proxy may but need not be a Member of the Company. If a Member appoints more than one proxy, the
appointments shall be invalid unless the Member specifies the proportion of the Member’s shareholdings to
be represented by each proxy.

2. Where a Member of the Company is an exempt authorised nominee as defined under the Securities
Industry (Central Depositories) Act, 1991 (“SICDA”) which holds ordinary shares in the Company for
multiple beneficial owners in one securities account (“omnibus account”), there is no limit to the number of
proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

3. Where a Member of the Company is an authorised nominee as defined under SICDA, it may appoint at
least one (1) proxy in respect of each securities account it holds with ordinary shares of the Company
standing to the credit of the said securities account.

4. If the appointer is a corporation, the proxy form must be executed under the common seal or under the
hand of its officer or attorney duly authorised in writing.

5. The Twenty-Fourth Annual General Meeting (“24th AGM”) will be conducted using RPV Facilities as a
virtual general meeting by the Company’s share registrar, Tricor Investor & Issuing House Services Sdn.
Bhd.. The registration, participation and voting procedures are as detailed in the Administrative Guide
which is available on the Company’s website at www.wascoenergy.com.

6. Pursuant to Section 327(2) of the Companies Act, 2016, the Chairman will be present at the
Broadcasting Venue being the main venue of the 24th AGM. Hence, no shareholders/proxies/corporate
representatives from the public will be physically present.

7. A Member registered in the Record of Depositors as at 23 May 2024 who is entitled to attend and vote at
the 24th AGM may appoint the Chairman of the meeting as his/her proxy.

8. In accordance with Section 334(3) of the Companies Act, 2016, the instrument appointing a proxy and
the power of attorney or other authority, if any, under which is signed or a notarially certified copy of
that power or authority shall be deposited as follows, not less than forty-eight (48) hours before the time
for holding the meeting or adjourned meeting at which the person named in the instrument proposes
to vote, or, in the case of a poll, not less than twenty-four (24) hours before the time appointed for the
taking of the poll at the 24th AGM. Pursuant to Paragraph 8.29A(1), Chapter 8 of the Main Market Listing
Requirements of Bursa Malaysia Securities Berhad, all resolutions set out in this notice are required to be
voted by poll.

(a) Deposit Hardcopy of Proxy Form

To the Company’s Registered Address at Suite 19.01, Level 19, The Gardens North Tower, Mid Valley
City, Lingkaran Syed Putra, 59200 Kuala Lumpur, Wilayah Persekutuan, Malaysia.

(b) Deposit of Proxy Form Electronically

To Tricor Investor & Issuing House Services Sdn. Bhd. via the TIIH Online website at https://tiih.online.

(c) The above Proxy Forms must be deposited accordingly latest by Wednesday, 29 May 2024 by 3.00
p.m.

298 Integrated Annual Report 2023

 Notice of Twenty-Fourth
Annual General Meeting
Explanatory Notes on Ordinary Business

1. Audited Financial Statements of the Company and the Group for the financial year ended 31 December
2023 and the Reports of the Directors and Auditors thereon

The Audited Financial Statements of the Company and the Group for the financial year ended 31
December 2023 are to be laid at the 24th AGM in accordance with Section 340(1)(a) of the Companies
Act, 2016 for discussion purpose only and do not require shareholders’ approval.

2. Payment of Directors’ Fees and Directors’ Meeting Allowances for the financial year ended 31
December 2023

The proposed Ordinary Resolution 1 is to obtain shareholders’ approval for the payment of Directors’ Fees
and Directors’ Meeting Allowances in respect of the financial year ended 31 December 2023.

3. Payment of Directors’ Meeting Allowances for the financial year ending 31 December 2024

The proposed Ordinary Resolution 2 is to obtain shareholders’ approval for the payment of Meeting
Allowances to the Non-Executive Directors on a quarterly basis and/or as and when incurred. The total
amount of the Directors’ Meeting Allowances of up to RM170,000 caters for the number of Board and/or
Committees’ meetings scheduled/proposed to be held during the financial year ending 31 December 2024.

4. Re-election of Halim Bin Haji Din, Tan Sri Professor Lin See Yan and Tan Sri Saw Choo Boon who retire
pursuant to Clause 117 of the Company’s Constitution

Pursuant to Clause 117 of the Company’s Constitution, one-third of the Directors for the time being or the
number nearest to one-third, shall retire from office at the Annual General Meeting. PROVIDED ALWAYS
that all Directors shall retire from office at least once in every three (3) years but shall be eligible for re-
election.

Hence, Halim Bin Haji Din, Tan Sri Professor Lin See Yan and Tan Sri Saw Choo Boon are due to retire at
the 24th AGM and being eligible, have offered themselves for re-election.

The Board supports the re-election of Halim Bin Haji Din, Tan Sri Professor Lin See Yan and Tan Sri Saw
Choo Boon who retire pursuant to Clause 117 of the Company’s Constitution.

Explanatory Notes on Special Business

1. Authority to Issue Shares by the Directors of the Company

The Ordinary Resolution 7, if passed, will give authority to the Directors of the Company to issue and allot
shares from the unissued share capital of the Company for such purposes as the Directors of the Company
in their absolute discretion consider to be in the interest of the Company without having to convene a
general meeting. This authority shall continue to be in force until the conclusion of the next Annual General
Meeting (“AGM”) or the expiration of the period within which the next AGM is required by law to be held,
whichever is the earlier; but any approval may be revoked or varied by a resolution of the Company in
general meeting.

The Company has not issued any new shares pursuant to Sections 75 and 76 of the Companies Act, 2016
under the general mandate which was approved at the Twenty-Third AGM of the Company held on 30 May
2023 and which will lapse at the conclusion of the Twenty-Fourth AGM. Hence, a renewal of this authority
is being sought at the Twenty-Fourth AGM.

The authority to issue shares pursuant to Sections 75 and 76 of the Companies Act, 2016 will provide
flexibility and expediency to the Company for any possible fund raising involving the issuance or placement
of shares to facilitate business expansion or strategic merger and acquisition opportunities involving
equity deals or part equity or to fund future investment project(s) or for working capital and operational
requirements, which the Directors of the Company consider to be in the best interest of the Company.

As such, any additional cost to be incurred or delay arising from the need to convene a general meeting to
approve such issuance of shares could be eliminated.

Wasco Berhad 299

Notice of Twenty-Fourth
Annual General Meeting
2. Proposed Authority to Buy-Back its Own Shares by the Company

The Ordinary Resolution 8, if passed, will allow the Directors of the Company to exercise the power of
the Company to purchase and/or hold not more than 10% (ten per centum) of the total number of issued
shares of the Company for the time being. This authority will expire at the conclusion of the next Annual
General Meeting unless earlier revoked or varied by ordinary resolution passed by shareholders at a
general meeting.

Please refer to Part A of the Share Buy-Back Statement dated 26 April 2024, which is accessible online on
the Company’s website at www.wascoenergy.com, for information pertaining to Ordinary Resolution 8.

3. Proposed Renewal of Shareholders’ Mandate for the Existing Recurrent Related Party Transactions and
Provision of Financial Assistance

The Ordinary Resolutions 9, 10 and 11, if passed, will allow the Company to enter into recurrent related
party transactions of a revenue or trading nature with the related parties and the provision of financial
assistance in the ordinary course of business which are necessary for the day-to-day operations based on
terms which are not more favourable to the related parties than those generally available to the public and
are not to the detriment of the minority shareholders of the Company.

Please refer to Part B of the Circular to Shareholders dated 26 April 2024, which is accessible online on
the Company’s website at www.wascoenergy.com, for information pertaining to Ordinary Resolutions 9, 10
and 11.

300 Integrated Annual Report 2023

 Statement Accompanying Notice of
Twenty-Fourth Annual General Meeting
1. The profile of Directors who are retiring pursuant to Clause 117 of the Company’s Constitution and are
standing for re-election at the Twenty-Fourth Annual General Meeting (“24th AGM”) of the Company
are as follows:

Ordinary Resolution 3
Halim Bin Haji Din
Non-Independent Non-Executive Director
Nationality/Age/Gender : Malaysian/77/Male
Date of Appointment : 22 May 2002 - as an Independent Non-Executive Director
Date of Redesignation : 23 May 2023 - as a Non-Independent Non-Executive Director
Date of Last Re-election : 26 May 2022
Academic/Professional : Fellow member of The Malaysian Institute of Certified Public
Qualification/Membership(s) Accountants (MICPA) and Malaysian Institute of Accountants
Other Directorship(s) : Public listed company(ies): Nil

Other public company(ies): Nil

Encik Halim Bin Haji Din does not hold any shares in Wasco Berhad (formerly known as Wah Seong
Corporation Berhad) (“WB”), has no family relationship with any Director and/or major shareholders of
WB, has no conflict of interest with WB and has not been convicted for any offence within the past five
(5) years other than possible traffic offences and have not been imposed any public sanction or penalty
by the relevant regulatory bodies during the financial year 2023.

Ordinary Resolution 4
Tan Sri Professor Lin See Yan
Non-Independent Non-Executive Director
Nationality/Age/Gender : Malaysian/84/Male
Date of Appointment : 20 July 2004 - as an Independent Non-Executive Director
Date of Redesignation : 23 May 2023 - as a Non-Independent Non-Executive Director
Date of Last Re-election : 26 May 2022
Academic/Professional : • BA in Economics, Statistics and Philosophy, University of
Qualification/Membership(s) Malaya, Singapore
• BA (Hons) in Economics, University of Malaya, Singapore
• MPA in Finance, Harvard University, USA
• MA in Business Economics, Harvard University, USA
• PhD in Economics, Harvard University, USA
• Hon. PhD in Economics, Universiti Utara Malaysia.
• Hon. Dr. Economics, Universiti Sains Malaysia.
Other Directorship(s): : Public listed company(ies): Nylex (Malaysia) Berhad

Other public company(ies): Nil

Tan Sri Professor Lin See Yan does not hold any shares in WB, has no family relationship with any
Director and/or major shareholders of WB, has no conflict of interest with WB and has not been
convicted for any offence within the past five (5) years other than possible traffic offences and have not
been imposed any public sanction or penalty by the relevant regulatory bodies during the financial year
2023.

Wasco Berhad 301

Statement Accompanying Notice of
Twenty-Fourth Annual General Meeting
Ordinary Resolution 5
Tan Sri Saw Choo Boon
Senior Independent Non-Executive Director
Nationality/Age/Gender : Malaysian/77/Male
Date of Appointment : 6 April 2018 - as an Independent Non-Executive Director
Date of Appointment : 23 May 2023 - as a Senior Independent Non-Executive Director
Date of Last Re-election : 21 May 2021
Academic/Professional : Bachelor of Science (Chemistry) Honours, University of Malaya
Qualification/Membership(s)
Other Directorship(s): : Public listed company(ies): Sentral REIT Management Sdn. Bhd.
(the Manager of Sentral REIT)

Other public company(ies): Nil

Tan Sri Saw Choo Boon does not hold any shares in WB, has no family relationship with any Director and/
or major shareholders of WB, has no conflict of interest with WB and has not been convicted for any
offence within the past five (5) years other than possible traffic offences and have not been imposed
any public sanction or penalty by the relevant regulatory bodies during the financial year 2023.

• Tan Sri Saw Choo Boon meets the criteria of an Independent Director as defined in Chapter 1 of the
Main Market Listing Requirements of Bursa Malaysia Securities Berhad.
• He performs his duties diligently and in the best interest of the Company and provides independent
judgement, broader views and balanced assessments to the proposals from the Management with his
diverse experience and expertise.
• He understands the Company’s industry well and is able to contribute to the effective oversight of
the Company’s business activities.
• He consistently challenges the Management in an effective and constructive manner.
• He maintains his independence where Management oversight and monitoring are concerned in the
execution of the Company’s strategic plans.

2. There is a renewal of the general mandate for the issuance of securities to be sought in accordance
with Paragraph 6.03(3) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad,
at the 24th AGM of the Company

The Company has not issued any new shares pursuant to Sections 75 and 76 of the Companies Act,
2016 under the general mandate which was approved at the Twenty-Third Annual General Meeting of the
Company held on 30 May 2023.

The purpose for the general mandate being sought to issue shares pursuant to Sections 75 and 76 of the
Companies Act, 2016 will provide flexibility and expediency to the Company for any possible fund raising
involving the issuance or placement of shares to facilitate business expansion or strategic merger and
acquisition opportunities involving equity deals or part equity or to fund future investment project(s) or for
working capital and operational requirements, which the Directors of the Company consider to be in the
best interest of the Company.

As such, any additional cost to be incurred or delay arising from the need to convene a general meeting to
approve such issuance of shares could be eliminated.

3. Date, Time and Broadcasting Venue of the 24th AGM

Date : Thursday, 30 May 2024

Time : 3.00 p.m.
Broadcasting Venue : West Side 1 & 2, Level 8, St. Giles Boulevard, The Boulevard, Mid Valley City,
Lingkaran Syed Putra, 59200 Kuala Lumpur, Wilayah Persekutuan, Malaysia

302 Integrated Annual Report 2023

 WASCO BERHAD
PROXY FORM
(formerly known as Wah Seong Corporation Berhad)
REGISTRATION NO.: 199901020946 (495846-A) Number of Ordinary Shares held
(INCORPORATED IN MALAYSIA)

I/We
(Full name in block letters)
NRIC or Company No. CDS Account No.

of
(Full address)
being a *member/members of WASCO BERHAD (formerly known as Wah Seong Corporation Berhad) [Registration No.

199901020946 (495846-A)] hereby appoint

(Full name in block letters)
NRIC No. of

(Full address)
or failing *him/her, NRIC No.
(Full name in block letters)
of
(Full address)

or failing *him/her, the Chairman of the Meeting as *my/our proxy to vote for *me/us on *my/our behalf, at the Twenty-Fourth
Annual General Meeting (“24th AGM”) of the Company to be conducted through live streaming and online remote participation
using Remote Participation and Voting (“RPV”) Facilities as a virtual general meeting at the Broadcasting Venue to be held
at West Side 1 & 2, Level 8, St. Giles Boulevard, The Boulevard, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur,
Wilayah Persekutuan, Malaysia on Thursday, 30 May 2024 at 3.00 p.m. and at any adjournment thereof in the manner indicated
below.

FOR AGAINST
Ordinary Resolution 1 To approve the Directors’ Fees of RM679,500 and Directors’ Meeting
Allowances of RM184,000 payable for the financial year ended 31
December 2023.
Ordinary Resolution 2 To approve the payment of Directors’ Meeting Allowances of up to an
amount of RM170,000 for the financial year ending 31 December 2024.
Ordinary Resolution 3 To re-elect Halim Bin Haji Din as Director who retires pursuant to Clause
117 of the Company’s Constitution.
Ordinary Resolution 4 To re-elect Tan Sri Professor Lin See Yan as Director who retires pursuant
to Clause 117 of the Company’s Constitution.
Ordinary Resolution 5 To re-elect Tan Sri Saw Choo Boon as Director who retires pursuant to
Clause 117 of the Company’s Constitution.
Ordinary Resolution 6 To re-appoint PricewaterhouseCoopers PLT as Auditors of the
Company for the ensuing year and to authorise the Directors to fix their
remuneration.
Ordinary Resolution 7 To authorise the issuance of shares by the Directors of the Company.
Ordinary Resolution 8 Proposed Authority to Buy-Back its Own Shares by the Company.
Ordinary Resolution 9 Proposed Renewal of Shareholders’ Mandate for the Existing Recurrent
Related Party Transactions of a Revenue or Trading Nature (“Existing
RRPT”) and Provision of Financial Assistance (“Existing PFA”) involving
Dato’ Seri Robert Tan Chung Meng, Madam Pauline Tan Suat Ming, Mr
Tony Tan Choon Keat, Tan Chin Nam Sendirian Berhad, Tan Kim Yeow
Sendirian Berhad and Wah Seong (Malaya) Trading Co. Sdn. Bhd.
Ordinary Resolution 10 Proposed Renewal of Shareholders’ Mandate for the Existing RRPT and
Existing PFA involving Mr Goh Eng Hooi.
Ordinary Resolution 11 Proposed Renewal of Shareholders’ Mandate for the Existing RRPT
involving Dato’ Mohamed Nizam Bin Abdul Razak and Encik Mohd Azlan
Bin Mohammed.
(Please indicate with an “x” in the space provided above as to how you wish to cast your vote. If no specific direction as to
voting is given, the proxy will vote or abstain from voting at his/her discretion.)
* Strike out whichever not applicable

Company Seal to be affixed here

Signature of Member if Member is a Corporation


Signed this: day of 2024

Contact No.:
Email Address:
Fold this flap for sealing

Affix
Stamp

THE COMPANY SECRETARY

WASCO BERHAD
(FORMERLY KNOWN AS WAH SEONG CORPORATION BERHAD)
[REGISTRATION NO.: 199901020946 (495846-A)]

Registered Office:
Suite 19.01, Level 19, The Gardens North Tower
Mid Valley City, Lingkaran Syed Putra
59200 Kuala Lumpur, Wilayah Persekutuan
Malaysia

Then fold here

Notes:

1. A proxy may but need not be a Member of the Company. If a Member appoints more than one proxy, the appointments shall be invalid
unless the Member specifies the proportion of the Member’s shareholdings to be represented by each proxy.

2. Where a Member of the Company is an exempt authorised nominee as defined under the Securities Industry (Central Depositories)
Act, 1991 (“SICDA”) which holds ordinary shares in the Company for multiple beneficial owners in one securities account (“omnibus
account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus
account it holds.

3. Where a Member of the Company is an authorised nominee as defined under SICDA, it may appoint at least one (1) proxy in respect of
each securities account it holds with ordinary shares of the Company standing to the credit of the said securities account.

4. If the appointer is a corporation, the proxy form must be executed under the common seal or under the hand of its officer or attorney
duly authorised in writing.

5. The 24th AGM will be conducted using RPV Facilities as a virtual general meeting by the Company’s share registrar, Tricor Investor
& Issuing House Services Sdn. Bhd.. The registration, participation and voting procedures are as detailed in the Administrative Guide
attached and which is also available on the Company’s website at www.wascoenergy.com.

6. Pursuant to Section 327(2) of the Companies Act, 2016, the Chairman will be present at the Broadcasting Venue being the main
venue of the 24th AGM. Hence no shareholders/proxies/corporate representatives from the public will be physically present.

7. For the purpose of determining a member who shall be entitled to attend this 24th AGM, the Company shall be requesting Bursa
Malaysia Depository Sdn. Bhd., in accordance with Clause 88 of the Company’s Constitution and Section 34(1) of SICDA, to issue
a Record of Depositors as at 23 May 2024 (“General Meeting Record of Depositors”). A Member registered in the General Meeting
Record of Depositors who is entitled to attend, speak and vote at the 24th AGM may appoint the Chairman of the meeting as his/her
proxy.

1st fold here

8. In accordance with Section 334(3) of the Companies Act, 2016, the instrument appointing a proxy and the power of attorney or other
authority, if any, under which is signed or a notarially certified copy of that power or authority shall be deposited as follows, not less
than forty-eight (48) hours before the time for holding the meeting or adjourned meeting at which the person named in the instrument
proposes to vote, or, in the case of a poll, not less than twenty-four (24) hours before the time appointed for the taking of the poll
at the 24th AGM. Pursuant to Paragraph 8.29A(1), Chapter 8 of the Main Market Listing Requirements of Bursa Malaysia Securities
Berhad, all resolutions set out in this notice are required to be voted by poll.

(a) Deposit Hardcopy of Proxy Form

To the Company’s Registered Address at Suite 19.01, Level 19, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra,
59200 Kuala Lumpur, Wilayah Persekutuan, Malaysia.

(b) Deposit of Proxy Form Electronically

To Tricor Investor & Issuing House Services Sdn. Bhd. via the TIIH Online website at https://tiih.online.

(c) The above Proxy Forms must be deposited accordingly latest by Wednesday, 29 May 2024 by 3.00 p.m.
Wasco Berhad (formerly known as Wah Seong Corporation Berhad)
Registration No (-A)

Suite  Level  The Gardens North Tower

Mid Valley City Lingkaran Syed Putra
 Kuala Lumpur Malaysia
Tel  +- 
Fax  +- 

wwwwascoenergycom