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MegaChem Limited

Management Online Q&A With Investors

Dear Investors,

Thank you very much for your questions and the opportunities to respond to them.

We hope you have a better understanding of our business through this online exchange.

Your questions are reposted in blue followed by our replies in black.

Best Regards,
The Management Team
MegaChem Limited

1. Dear Corrine Sim, you wrote:

Why is MegaChem listing its associated company in Thailand? What are you going to do with the IPO proceeds?

The IPO proceeds will be used to deepen its presence in Thailand, expand into markets in Indochina as well as for working capital. Thailand holds promising prospects for Megachem’s business and could serve as a springboard for us to further establish our foothold in Southeast Asia and beyond.

2. Dear George Chen, you wrote:

Your impairment of trade receivables increased 10 times to S$1 million, what is the reason for the huge increase?

There was a provision of about S$900,000 for trade receivables from Venezuela. Due to exchange control in Venezuela, payments coming out of the country has been slow. Without this impairment, our net profit before tax would not have decreased vis-ŕ-vis prior year.

3. Dear Alvin Tan, you wrote:

Why is the sales in Australia so strong?

Australia is a fairly new operation for us. Its revenue base is still relatively small. We are committed to grow our business there.

4. Dear David Koh, you wrote:

Will the water price increase, carbon and diesel tax announced during budget 2017 affect your business?

Yes there will be cost increases arising from these although we do not expect any significant impact to our business costs arising therefrom.

Dear Investors,

Thank you for all your questions and your interest in MegaChem Limited. We have come to the end of this Q&A session.

We have enjoyed the session and have learnt much from your questions. We hope that through this Q&A, you have gained better insights to our Company and our operations.

Best Regards,
The Management Team
MegaChem Limited