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Extracted from Annual Report 2016

Dear Shareholders,

On behalf of the Board of Directors, and all at Mclean Group, I am please to present to you our 7th Annual Report and the Audited Financial Statements for the financial year ended 31 December 2016 ("FY16").

It has been a year of positive consolidation with MClean returning to profitability for the financial year ended 31 December 2016.

Key Financial Highlights

MClean achieved a total revenue RM59.3 million as compared to RM57.4 million for the preceding corresponding financial year. Revenue from the Surface Treatment & Precision Cleaning ("STPC") Division has increase due to the full year contribution from DWZ group. This increase was partially offset by the absence of revenue from Technical Assembly Services ("TAS"), which contributed RM17.6 million in the previous year. The Group achieved a profit before tax of RM2.7 million for FY 2016 as compared with a profit before tax of RM3.8 million for FY2015. Excluding non-recurring item, the Group profit before tax for FY2016 would be RM1.4 million as compared with an operating loss of RM4.0 million for FY2015, a significant turnaround to operating profitability.

Outlook for 2017

Looking ahead, industrywide demand for traditional Hard Disk Drives ("HDD") will continue to face pressure from Solid State Drives ("SSD"). However, we expect the SSD much higher cost price per gigabyte gap as compared with HDD to remain, and the increasing proliferation of data requirements will continue to fuel demand for HDD.

To counter increasing competition, we will expand our reach by setting up a operating hub in Thailand. We will be nearer to the centre of action as major HDD manufacturers increase production allocation in Thailand over China.

Meanwhile, we are actively adapting our core strength in Cleanroom services to reach other market segment requirements. We shall explore alliances with business partners that shows strong growth potential. I look forward to share with you these exciting ventures ahead.

Appreciation

FY2016 has been an important year for MClean, which mark the return to profitability. On behalf of the Board, I would like to convey my deep appreciation and gratitude to my fellow CEO, management team and loyal employees for their dedication and perseverance. My appreciation also goes to our valued customers and business associates for their continuous support. The Board is optimistic that the year ahead will present further opportunities to extend our business while enhancing shareholder value.

YEO HOCK HUAT
Executive Chairman

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