CHAIRMAN’S STATEMENT DEAR SHAREHOLDERS, ON BEHALF OF THE BOARD OF DIRECTORS (“THE BOARD”), I AM PLEASED TO PRESENT THE ANNUAL REPORT OF KIMLUN CORPORATION BERHAD (“OUR COMPANY”) FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2021 (“FY2021”). OUR OPERATING ENVIRONMENT On 11 March 2020, the World Health Organisation declared the Coronavirus (“COVID-19”) outbreak as a pandemic in view of the speed and scale of its transmission globally. The COVID-19 pandemic has significantly disrupted many business operations around the world. For the Group, the impact on business operations has not been a direct consequence of the COVID-19 outbreak, but a result of themeasures taken by the Malaysia Government and Singapore Government to contain it. The Malaysia Government implemented the nationwide Full Movement Control Order (“FMCO”) effective from 1 June 2021. Almost all of the Group’s construction work sites were shut down from 1 June 2021 to 15 August 2021, as only critical projects were allowed to operate, subject to MITI’s approval. For the remaining period of FY2021, the Group’s compliance to the prescribed caps on work forcecapacityallowed toattend toworkat the Group’s business premises and the applicable SOPs has resulted in lower productivity of the Group’s business operations; and Singapore banned all long-term pass holders and short-term visitors with recent travel history to India, Bangladesh, Nepal, Pakistan and Sri Lanka from entering Singapore effective from 24 April 2021 and 2 May 2021 respectively. The entry ban had impacted labour supply in Singapore’s construction sector which employs many Indian and Bangladeshi workers, resulted in slower execution of the Group’s customers’ projects in Singapore and thus deferments in their taking delivery of the Group’s products. In addition, with the economy reopening during FY2021, the pandemic-inflicted supply chain disruptions and supply constrictions, rising cost of raw materials, shortage of workers have resulted in higher cost of operation. Further, in view of the supply chain constrictions, shortage of labour and economy uncertainty, the Group has been very cautious in pursuing order book replenishment and has resulted in low order book replenishment during the first three quarters of FY2021. Consequentially, the Group’s revenue and earnings were affected negatively. K imlun Corporat ion Berhad Regi s t rat ion No. 200901023978 (867077-X) 11
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