Ar 2008

TM
WE MAKE
THINGS HAPPEN
Annual Report 2008
Cover Photo by Olivia Lum

Contents
Message from Group CEO, President and Managing Director 02
Growing Geographical Presence 06
Group Financial Highlights & Review 08
Board of Directors 12
Senior Management 14
Advisors 15
Heads of Strategic Business Units 16
Human Capital 18
Corporate Social Responsibility 19
Awards and Accolades 20
20 Years in Review - Key Milestones 22
Spirit of Innovation 26
Research & Development 30
EPC and O&M 36
Capital Management 40
Sustainable Growth Model 44
About Hyflux OUR VALUES - BEST
At Hyflux, we are dedicated to turning innovations into leading
environmental solutions to mitigate global water scarcity and rapid Boldness
depletion of natural resources. Dare to dream, dare to do and dare to excel
From seawater desalination, water recycling, wastewater and potable water Entrepreneurship
treatment to renewable resources management, Hyflux is committed to Nurture the entrepreneurial spirit, embrace
providing cost-effective, reliable and sustainable water management and challenge and master change
services to water-stressed cities and industrial customers.
Satisfaction
Hyflux is internationally recognised for our capabilities in proprietary Exceed internal and external customer
membrane technologies, engineering, procurement & construction (“EPC”) satisfaction, take pride in work and deliver
and operations & maintenance (“O&M”). excellence
Our operations span a wide geographical footprint, from Southeast Asia, Testimony
China, India to the Middle East and North Africa (“MENA”) region. Be the face behind the brand, excel in
business conduct and embrace best
practices in corporate governance
OUR VISION
To be the leading company the world seeks for innovative and effective
environmental solutions.
OUR MISSION
To provide efficient and cost-effective solutions to meet our clients’ needs
through innovation and technological advancement.
Photo by Olivia Lum

Message from
Group CEO, President
and Managing Director
“The journey ahead will remain tough. But, as
we stay focused on strengthening what we have
put in place, continue to challenge ourselves
and continue to break technological boundaries,
we can make things happen. I believe Hyflux
will emerge stronger and poised to tap new
opportunities ahead.”
Olivia Lum, Group CEO, President and Managing Director

4 Hyflux Ltd annual report 2008
Message from Group CEO, President and Managing Director (cont’d)
“Hyflux will continue to focus on project execution, quality

growth and balance sheet strength. At the same time, we will
expand our recurring earning streams.“
A Record FY2008 – Reflection We believe Hyflux will emerge stronger ongoing emphasis by the Chinese
of Innovation and Teamwork as a result of our strong business Government in improving accessibility
FY2008 was a record year for our fundamentals, prudent cost structure and availability of potable water to
Group. We registered a net profit and proven framework supported by more people in China while pushing
after tax and minority interests of cutting-edge membrane technologies for higher wastewater treatment
S$59 million on the back of a record and teams of committed and compliance. Hyflux will remain
revenue base of S$554 million. Our experienced staff. disciplined and selective in growing
order book as at 31 December 2008 our order book. We have secured
stood at S$1.15 billion. These were Executing our Order Book RMB945 million worth of new water
achieved through our strict discipline China and MENA will remain our key and wastewater treatment projects
of quality execution and delivery markets as the Group continues to in the Jiangsu, Shandong, Tianjin and
within schedule and budget as well as deepen our market penetration in Hebei provinces in FY2008 and are
prudence in cost management. these regions. poised to tap the growth potential in
other municipals.
FY2008 was also a challenging year for In FY2008, the Group continued to
Hyflux. The bleak economic outlook enjoy strong growth in the municipal Middle East and North Africa
has continued to affect all sectors sector. Revenue from the municipal (“MENA”)
in our economy and the general sector surged more than five folds to Our landmark win to build the world’s
risk appetite of lending institutions. S$477 million, as compared largest membrane-based seawater
Accessibility to funding for all to S$89 million in FY2007. This desalination plant with a daily capacity
companies has become even more sector accounted for 86% of the of 500,000 m3 in Magtaa, Algeria,
challenging. However, at Hyflux, we Group’s revenue. worth US$500 million, has propelled
have been focusing on a few very Hyflux’s ranking upwards in the global
critical areas. Revenue from the industrial sector, seawater desalination arena in FY2008.
however, has contracted by 25% to On top of this, Hyflux is building
The Group’s financial position remains S$76 million in FY2008 and accounted another seawater desalination plant
strong. Return on equity climbed for 14% of the Group’s revenue. Going with a daily capacity of 200,000 m3
to 19% while net gearing remained forward, while we expect industrial in Tlemcen, Algeria. With these two
at 0.54 times. In line with Hyflux’s sales to reflect the weakening projects, we will leverage on our
sustainable business model, the economic climate in China, we believe market knowledge and network to
Group divested five of our water and the positive momentum in the identify more bankable projects in
wastewater treatment plants to Hyflux municipal sector should help sustain Algeria. Our plants in Algeria will be
Water Trust. This enabled the Group the Group’s growth. a global showcase for the Group.
to recycle the capital to fund new
projects and businesses. China Moving Forward
China remains a stable and growing Hyflux will remain focused on
We have also been focusing on footprint for the Group. We will not staying ahead of the curve and
building a very strong order book. Our be complacent but will continue will continue to strengthen our
customers now span widely across our to deepen our market penetration membrane technology platform and
key markets in Southeast Asia, China, and expand our presence in China. infrastructure competency as well as
India and the Middle East and North Our business enquiries continue investment in human capital.
Africa (“MENA”) region. to be robust. This is a reflection of
Hyflux Ltd annual report 2008 5
Message from Group CEO, President and Managing Director (cont’d)
(L-R): Olivia Lum, Group CEO,

President & Managing Director;
Sam Ong, Group Deputy CEO
& CFO
The Group will continue to invest key markets. Hyflux will continue to To our Hyflux staff, I thank each of you
effectively in strengthening our in- focus on project execution, quality from the bottom of my heart. Your
house research & development (“R&D”) growth and balance sheet strength. innovative spirit, commitment and
expertise. This organic growth is an At the same time, we will expand unwavering dedication have made
integral part of Hyflux’s competitive our recurring earning streams, which Hyflux what it is today.
edge as it enables a continuous include long-term O&M contracts.
and systematic process in achieving Yes, the journey ahead will remain
speed-to-market advantage, resulting We Make Things Happen tough. But, as we stay focused on
in a seamless flow from R&D to 2009 is also a momentous year strengthening what we have put in
commercialisation. for Hyflux. This year marks our 20th place, continue to challenge ourselves
anniversary milestone. In the past 20 and continue to break technological
Our focus on prudent spending years, we have seen the company boundaries, we can make things
and efficient cost structure is part of grow from a humble beginning with happen. I believe Hyflux will emerge
the Group’s business strategy. This a staff strength of three in Singapore stronger and poised to tap new
disciplined approach will put Hyflux to close to 1,900 worldwide. We also opportunities ahead.
in good stead, especially during these take great pride that, to date, Hyflux’s
challenging times. As such, while membrane products and systems Together, let us make things happen!
many companies have implemented have been installed in more than 1,000
retrenchment or introduced salary plants in over 300 locations worldwide. Olivia Lum
reductions, the Group intends to hire Group CEO, President and Managing
progressively to support our strategic I would like to thank each of you – Director
growth areas, particularly in the our shareholders, directors, partners,
operations and maintenance (“O&M”) customers and staff – for supporting
division. We foresee increases in staffing us through the past 20 years of success
needs as more completed projects are and growth. For our shareholders, we
added to our O&M portfolio. are proposing a first and final dividend
of 3.43 cents per share, almost
While 2009 will be challenging, we doubling that of FY2007.
are optimistic of the huge growth
potential of the water sector in our
Divider Photo: Yoong Kang Chee

Growing Geographical Presence
Sweden
SINGAPORE HEADQUARTERS
Hyflux Building Netherlands
Belgium
Germany
202 Kallang Bahru Switzerland
Singapore 339339
MALAYSIA OFFICE
Algeria
B11-LG-2, Block B Dubai
Megan Corporate Park
Jalan 1/125E, Taman Desa Petaling
57100 Kuala Lumpur
Malaysia
CHINA OFFICES
99 Juli Road
Zhangjiang Hi-Tech Park
Pudong, Shanghai 201203
People’s Republic of China
No. 1517-1519 Namibia

Tianjin Central Plaza
188 Jiefangbei Road
Heping District, Tianjin 300042
People’s Republic of China
Middle East and North Africa (“MENA”)*

Hyflux membranes and Country Industry Membranes
systems have been Algeria Seawater Desalination KristalTM
Dubai Sewage Treatment KristalTM
installed in more than Namibia Textile Wastewater KristalTM
1,000 plants in over

Europe*
300 locations worldwide. Country Industry Membranes
Belgium Food & Beverage InoCepTM
Germany Dairy & Milk InoCepTM
(2 locations)
Germany Food & Beverage InoCepTM
Germany Wastewater Treatment InoCepTM
Sweden Chemical Industry InoCepTM
Switzerland Dairy & Milk InoCepTM
The Netherlands Drinking Water KristalTM
The Netherlands Drinking Water InoCepTM
The Netherlands Food & Beverage InoCepTM
The Netherlands Oil Recycling InoCepTM
The Netherlands Wastewater Treatment InoCepTM
Growing Geographical Presence (cont’d)
ALGERIA OFFICE
47 rue Said HALES
El Mouradia
Hyflux Offices
16308 Alger
Hyflux Membranes and Algérie
Systems Installations
China INDIA OFFICE
India Unit 7A & 7B
Doshi Towers
156 Poonamallee High Road
Malaysia
Kilpauk, Chennai - 600010
Singapore India
Indonesia THE NETHERLANDS OFFICE

Lage Dijk 29B
5705 BX Helmond
PO Box 2128
5700 DA Helmond
The Netherlands
This map is not to scale
China* Southeast Asia*

Province Industry Membranes Country Industry Membranes
Anhui Pharmaceutical FerroCepTM Indonesia River Water Treatment KristalTM
Beijing Ultra-pure Water KristalTM Malaysia Brine Regenerant Recovery KristalTM
Guangdong Desalination & Wastewater KristalTM Malaysia River Water Treatment KristalTM
Guangdong Pharmaceutical FerroCepTM Singapore Industrial Water Reclamation KristalTM
Guangxi Pharmaceutical FerroCepTM Singapore Petroleum Wastewater KristalTM
Hebei Pharmaceutical FerroCepTM Singapore Sewage Treatment KristalTM
Henan Pharmaceutical FerroCepTM
Hubei Pharmaceutical FerroCepTM
Inner Mongolia Pharmaceutical FerroCepTM India*
Jiangsu Industrial Wastewater FerroCepTM
Country Industry Membranes
Jiangsu Lube-Oil Purification PoroCepTM
Liaoning L-lactic Acid PoroCepTM India Oil FerroCepTM
Liaoning Pharmaceutical FerroCepTM India Pharmaceutical InoCepTM
Ningxia L-lactic Acid PoroCepTM
Ningxia Pharmaceutical FerroCepTM
Shandong Pharmaceutical FerroCepTM
Shanghai Pharmaceutical FerroCepTM
Shanxi Pharmaceutical FerroCepTM
Shenzhen Pharmaceutical FerroCepTM
Sichuan Pharmaceutical FerroCepTM
Tianjin Seawater Desalination KristalTM
Xinjiang Pharmaceutical FerroCepTM
Zhejiang Pharmaceutical FerroCepTM
* Global key installations
Group Financial Highlights & Review
Key Financial Data

(For year ended 31 December)
S$’000 2004 2005 2006 2007 2008
Revenue 88,655 131,504 142,379 192,786 554,224

Profit Before Tax 28,844 50,374 20,178 38,693 70,375
Profit After Tax 27,876 49,303 15,357 36,645 62,218
Profit After Tax and Minority Interests (“PATMI”) 26,104 46,393 15,473 32,949 59,036
Shareholders’ Equity 112,647 189,563 199,601 239,772 297,547

Total Assets 305,048 401,087 443,398 549,500 846,555
Net Assets 116,022 197,286 218,066 247,067 307,899
Net Asset Value per share (cents) * 35.68 36.84 38.47 45.70 56.70
Earnings per share (cents) 5.55 9.24 3.00 6.32 11.25
Dividend per share (cents) 1.27 1.35 1.35 1.89 3.43
Return on Revenue (%) 29.4% 35.3% 10.9% 17.1% 10.7%

Return on Equity (%) 23.2% 24.5% 7.8% 13.7% 19.8%
* Net Asset Value excludes Minority Interests
Group Revenue by Country & Region
350.0
300.0
300.0
250.0
223.0
S$ million
200.0
157.0
150.0
100.0
104.8
72.9 73.5
58.0
50.0 37.6 27.6 31.2
15.8 8.2
0.0
2004 2005 2006 2007 2008
Singapore and Others

China
MENA
All figures are quoted in Singapore Dollars

Group Financial Highlights & Review (cont’d)
(For year ended 31 December)

+187%
increase in revenue
(2007: S$193 million vs 2008:
Profit After Tax and Minority Interests S$554 million)
70,000
59,036
60,000
50,000 46,393 +79%
S$ ‘000
40,000 32,949
30,000 26,104 increase in PATMI
20,000 15,473 (2007: S$33 million vs 2008:
10,000 S$59 million)
0
2004 2005 2006 2007 2008
11.25 cents
earnings per share
Earnings Per Share
12.00
9.24
11.25 3.43 cents
10.00
8.00
dividend per share
6.32
cents
6.00 5.55
4.00 3.00
2.00
0.00
2004 2005 2006 2007 2008
More than 5
times
increase in revenue
from municipal sector
Net Asset Value Per Share 27 times

increase in revenue
56.70 from MENA region
60.00
50.00 45.70
40.00 35.68 36.84 38.47
cents
30.00
20.00
10.00
0.00
2004 2005 2006 2007 2008
Group Revenue Financial Review

by Country (For year ended 31 December)
S$ million 2008 2007 % change
6% Revenue 554.2 192.8 +187%

Profit Before Tax 70.4 38.7 +82%
Profit After Tax and Minority Interests 59.0 32.9 +79%
Earnings per share – basic (cents) 11.25 6.32 +78%
2008 Overview In the MENA region, the Group is

In FY2008, net profit after tax and building two reverse osmosis seawater
minority interests for the Group surged desalination plants in Algeria on a
by 79% to S$59.0 million. Accordingly, Design-Build-Own-Operate-Transfer
40% basic earnings per share jumped by (“DBOOT”) basis. The first plant in
54% 78% to 11.25 cents. Tlemcen, with a designed capacity
of 200,000 m3/day, is scheduled for
Revenue completion in early 2010. In April
2008, Hyflux won the bid to build
Group revenue for FY2008 increased the world’s largest reverse osmosis
by more than two folds to S$554.2 seawater desalination plant in Magtaa,
14% million as compared to S$192.8 million at the point of announcement, with a
in FY2007. The FY2008 revenue is the designed capacity of 500,000 m3/day. The
4% highest-ever achieved by the Group. plant, with an estimated Engineering,
Procurement & Construction (“EPC”)
Revenue from the municipal sector
value of US$500 million, held its
2007 increased more than five times to
on-site ground breaking ceremony
S$476.8 million from S$89.0 million,
on 16 December 2008. The plant is
representing 86% of the Group’s
scheduled to be completed in 2011.
revenue. This is mainly attributed to
the significant contracts won in China At the same time, the Group has
82% and Algeria. secured long-term operations and
maintenance (“O&M”) contracts for
Fundamentals for the municipal
China our operational plants in China and
sector remain strong and this sector
Singapore. As at 31 December 2008,
MENA looks set to continue to be the largest
we have added 5 more operational
Singapore and Others contributor to the Group’s revenue.
plants to our O&M portfolio, increasing
China and Middle East and North
the number of total operating plants
Africa (“MENA”) region will remain the
to more than 15 from 11 in FY2007.
key growth markets as we continue
Together with the new plants in
to deepen market penetration while
Algeria, these O&M contracts will
focusing on order book execution.
emerge as steady recurring earnings
stream for the next 20-30 years.
Revenue from the industrial sector,
however, decreased by 25% to S$76.4
The Group’s order book as at
million from S$102.3 million a year
31 December 2008 stood at S$1.15
earlier. This was largely attributed to
billion, a 34% increase from S$863
the slowdown in economic activities
million as at 31 December 2007.
in China.
In addition, we have also grown our
O&M order book significantly, reaching
Based on geographical breakdown,
S$335 million as at 31 December 2008.
China and MENA accounted for
The O&M order book will be realised
54% and 40% of the total revenue
progressively over the respective plant
respectively for FY2008.
concession periods.
Costs and Expenses Non-current assets increased from Group Revenue

S$209.9 million as at 31 December
Raw materials and consumables costs
2007 to S$462.4 million as at 31
by Sector
increased from S$107.2 million in
FY2007 to S$387.8 million in FY2008. December 2008. Intangible assets
Higher material costs incurred were and financial and lease receivables
a reflection of significant increase in increased by S$26.0 million and
S$184.6 million respectively, in line 14%
contracts secured and executed during
the year. with the progress of construction of
water plants in China. In addition, the
Personnel expenses increased to increase in non-trade amount due
S$52.6 million in FY2008 from S$33.9 from related parties was a result of
million in FY2007. This is in tandem higher shareholder loans granted 2008
with the business growth. to associates.
Finance expenses increased marginally Current liabilities increased from

to S$10.2 million in FY2008 from S$8.9 S$106.1 million as at 31 December
million in FY2007. 2007 to S$324.5 million as at 86%
31 December 2008, mainly due
Other operating expenses increased to increases in trade related
to S$30.4 million in FY2008 from payables, current portion of the
S$9.4 million in FY2007 due to higher interest-bearing loans and other 1%
professional fees, selling and working capital borrowings.
travelling expenses. 46%
Non-current liabilities increased from
The tax charge in FY2008 reflected the S$196.3 million as at 31 December
tax exemptions and incentives enjoyed 2007 to S$214.2 million as at 31
by certain entities in the Group. December 2008, resulting mainly 2007
from the increase in bank borrowings
Overall, the net impact of the above during the financial year to support the
resulted in net profit after tax and Group’s expansion.
minority interests for the Group of 53%
S$59.0 million in FY2008. Cashflow and Liquidity
The Group’s cash position as at 31
Earnings Per Share December 2008 was S$90.7 million,
Municipal
Accordingly, basic and fully diluted down by S$30.3 million as compared
earnings per share increased more to the previous financial year. This was Industrial
than one time to 11.25 cents and because FY2007 included a one- Others
10.99 cents respectively, compared to off proceeds from the Initial Public
a year earlier. The increase was Offerings of Hyflux Water Trust.
due to the higher profit achieved
in FY2008. In FY2008, the Group generated cash
of S$29.9 million from its operations,
Balance Sheet Review mainly due to the increase in operating
profit. Cash used in investing activities
In line with the improved profit in
for the financial year was largely due
FY2008, the Group’s shareholders’
to capital expenditure to support the
equity increased from S$239.8 million
Group’s expansion and loans granted
as at 31 December 2007 to S$297.5
to associates. Cash from financing
million as at 31 December 2008.
activities was mainly due to the
Similarly, current assets increased from
proceeds from borrowings for funding
S$339.6 million as at 31 December
of the Group’s investment.
2007 to S$384.2 million as at 31
December 2008.
Board of Directors
Olivia Lum Shimbun Inc. at the 11th Nikkei Asia Prize Mr Teo holds an Honours degree in
Group CEO, President & Managing Director 2006, and most recently the Rising Asia – Law from the University of Hull and is
Ms Lum started corporate life as a chemist The Next 10 Years Award by the Singapore a Barrister-at-Law from Lincoln’s Inn.
with Glaxo Pharmaceutical and left in 1989 Institute of International Affairs (SIIA) and
AXN ASIA. She was also awarded the Lee Joo Hai
to start up Hydrochem (S) Pte Ltd, the Non-Executive Independent Director
precursor to Hyflux Ltd. Asiamoney’s Corporate Executive of the
Year 2005 in Singapore. Mr Lee has been a Non-Executive
Managing the Group for 20 years now, Independent Director of Hyflux Ltd since
Ms Lum is the driving force behind Ms Lum holds an Honours degree in December 2000. He is the Chairman of
Hyflux’s growth and business expansion, Science from the National University the Audit Committee and a member
responsible for policy and strategy of Singapore. of the Nominating, Remuneration, Risk
formulation and corporate direction. Teo Kiang Kok Management and Executive Committees.
A former Nominated Member of the Non-Executive Non-Independent Director Mr Lee is a CPA and a member of the
Singapore Parliament, Ms Lum holds Mr Teo has been a Non-Executive Institute of Certified Public Accountants of
several positions in the public service. Non-Independent Director of Hyflux Ltd Singapore and the Institute of Chartered
Presently, she sits on the board of a since December 2000. He is currently Accountants in England and Wales. He is
number of companies. She is a member a member of the Nominating, Audit, currently a senior partner in BDO Raffles,
of the National University of Singapore Remuneration, Risk Management and a public accounting firm and has in excess
Board of Trustees, Temasek Life Sciences Executive Committees. of 20 years of experience in accounting
Laboratory Limited as well as National and auditing.
University Health System Pte Ltd. In A lawyer with more than 20 years of
addition to her commitments in Hyflux, experience, Mr Teo is a senior partner Mr Lee also sits on the board of other
Ms Lum is also a member of the Singapore- of the law firm, Shook Lin & Bok LLP. He listed companies, including Lung Kee
Tianjin Economic & Trade Council, and the heads Shook Lin & Bok LLP’s corporate & (Bermuda) Holdings Ltd and Food
Singapore-Jiangsu Cooperation Council. corporate finance and China practices. Junction Holdings Ltd.
Among the many accolades Ms Lum Mr Teo serves on the boards of a number Gay Chee Cheong
has received for her entrepreneurial of other companies including Memtech Non-Executive Independent Director
achievements are: the Winner of the International Limited, Jadason Enterprises Mr Gay has been a Non-Executive
Regional Growth Award by Nihon Keizai Ltd and Ocean Sky International Ltd. Independent Director of Hyflux Ltd since
August 2001. He is also the Chairman of
Board of Directors (cont’d)
the Nominating Committee, as well as a responsible for the Group’s human Professor Tan Teck Meng
member of the Remuneration, Audit and resources, procurement and general Non-Executive Independent Director
Executive Committees. administration functions. Prior to joining Professor Tan has been a Non-Executive
Hyflux, Mr Murugasu had accumulated Independent Director of Hyflux Ltd
Mr Gay co-founded and was the CEO of 2G over 15 years of experience in the public
Capital Private Limited, a private investment since April 2007. He is the Chairman
sector as well as with a foreign bank. of Remuneration Committee and a
company investing in equities and private
companies in the Asia Pacific economies. member of the Audit Committee.
He holds an Honours degree in Computing
The company was awarded Highest Net Science from Imperial College, United Professor Tan is currently Professor
Profit in 2006 and Net Profit Excellence in Kingdom, and a Master’s degree from of Accounting in the School of
2007 in the annual SME 500 ranking. the London School of Economics, Accountancy at Singapore Management
Mr Gay was the Group Executive Director United Kingdom. University and a Council Member of the
of JIT Electronics Pte Ltd for four years, Accounting Standards Council.
Raj Mitta
responsible for corporate development, Non-Executive Independent Director Professor Tan also sits on the board
business strategy and investments of the of a number of companies including:
JIT Group. He established operational Mr Mitta has been a Non-Executive
Independent Director of Hyfux Ltd since Singapore Reinsurance Corporation
subsidiaries in Singapore, China and Limited; and Kim Eng Holdings Limited
Hungary and served concurrently as their April 2007. He is the Chairman of Risk
Management Committee. among others.
respective Managing Directors. He initiated
and was responsible for the public listing of Mr Mitta is currently the Chairman of Professor Tan has a Bachelor of
JIT Electronics in November 1997 and the Essential Value Associates Pte Ltd, a Accountancy (BAcc) Degree from the
subsequent merger of JIT with Flextronics boutique high-powered consultancy firm, University of Singapore and a Masters
International valued at $1.16 billion in providing hands-on personal counseling of Commerce (MCom) (Honours) from
August 2000. on issues of managing change and the University of New South Wales in
strategic implementation with the result of Australia. In 1996, he was awarded
Mr Gay was awarded the Singapore an Honorary PhD by Liaoning
Armed Forces Overseas Training Award driving lasting change in organisations and
developing high growth businesses with University (China).
(Graduating) and attended the Royal
Military Academy (RMA), Sandhurst quality governance and sustainability. He holds Fellowships in the Institute
and Royal Military College of Science, Mr Mitta’s client list includes multinationals of Certified Public Accountants of
Shrivenham, United Kingdom. At RMA, like PepsiCo, Gillette, Kelloggs, and the Singapore (FCPA), Australian Society
Sandhurst, Mr Gay won the Nigeria Prize for Governments of Singapore, Malaysia, of CPAs (FCPA), Institute of Chartered
Best Overseas Student Officer and at the Indonesia, Philippines, Australia and Secretaries and Administrators (FCIS),
Singapore Command and Staff College, the India. He has also worked with regional and Chartered Management Institute,
Top Student Prize. conglomerates like Hutchisons (HK), UK (FCMI).
Mr Gay holds Honours degrees in Jardines (HK), Bakrie Group (Indonesia), Ahmed Butti Ahmed
Electronics Engineering from the Royal Reliance (India), Amex, Citicorp, British Non-Executive Independent Director
Military College of Science, Shrivenham, Airways and telecom operators like
Mr Ahmed has been a Non-Executive
United Kingdom, and in Economics from Optus, Orange, Singapore Telecom
Independent Director of Hyflux Ltd since
University of London. He also has a Masters and Deutsche Telekom.
April 2008.
of Business Administration from the Prior to his experience of over 14 years
National University of Singapore. Mr Ahmed is currently the Director General
in consulting, Mr Mitta held senior
of Dubai Customs and CEO of the Ports,
Christopher Murugasu marketing roles with Pepsico (US and
Customs and Freezone Corporation
Non-Executive Non-Independent Director Cyprus) and Mars Inc. (UK). Mr Mitta is a
(PCFC) Authority.
seasoned negotiator and deal maker with
Mr Murugasu has been a Non-Executive well developed cross cultural sensitivity Mr Ahmed serves as Chairman for several
Non-Independent Director of Hyflux Ltd developed through living and working companies including Imdaad (facilities
since February 2005. across diverse countries. management), Palm Utilities (district
Mr Murugasu is also a member of the cooling & water treatment) and Dubai
Mr Mitta holds a Bachelors degree in
Risk Management and Remuneration Security Services. In addition, he also
Chemical Engineering from the University
Committees. serves as a board member for Dubai World,
of Bombay, and a Masters in Business
Tamweel and Federal Customs Authority.
Previously Senior Vice President for Administration from the Indian Institute of
Corporate Services at Hyflux, he was Management, Ahmedabad; in India. He holds a Masters degree in Science from
Denver University, USA.
Standing (L-R): Lee Joo Hai, Ahmed Butti Ahmed, Gay Chee Cheong, Raj Mitta
Seated (L-R): Christopher Murugasu, Olivia Lum, Professor Tan Teck Meng , Teo Kiang Kok
Photo: Yoong Kang Chee
Senior Management
Standing (L-R): Lee Soon Eng, Senior MD, Global Operations; Foo Hee Kiang, Group EVP, Capital Markets & Industry
Relations; Sam Ong, Group Deputy CEO & CFO; Fong Chun Hoe, Group EVP & Chief Manufacturing Officer
Seated (L-R): Cho Wee Peng, Group EVP & Chief Investment Officer; Olivia Lum, Group CEO, President & Managing
Director; Winnifred Heap, Group EVP, Capital Markets
Advisors
(L-R): Chen Bao Liu, Senior Advisor; Hoe Kum Yoke, Advisor; Gu Jia Long, Senior Advisor; Freddy Soon, Advisor
Heads of Strategic Business Units
Back row (L-R): Poh Teck Heok, MD, Energy; Hacene Debbah, GM, Algeria; Gary Kee, CEO, Hyflux Water Trust
Management Pte Ltd; Ge Wen Yue, MD, China Industrial Products
Front row (L-R): Michael Siew, GM, Operations & Maintenance; Kang Thian Jian, MD, Electrical, Instrumentation
& Control and System Manufacturing & Project Management; Chia Yew Choon, MD, Manufacturing
Heads of Strategic Business Units (cont’d)
Back row (L-R): Dr Rinse Terpstra, MD & Chief Technology Officer, Hyflux CEPAration BV; Cindi Ng, GM, Consumer
Products; Benjamin Tan, MD, MENA; Gireesh Bhat, GM, India Industrial Products
Front row (L-R): Peter Wu, MD, China Structured Projects & Operations & Maintenance; Wong Khai Theen, MD,
Business Development; Goh Eng Kwang, MD, China EPC; Yang Ai Chian, Senior VP, Legal (Business); Allan Toh,
GM, Southeast Asia Industrial Products
Human Capital
Our Hyflux Family Together with a closely-knit workforce around

the world, we will make things happen.
Photo: Jolyn Sng
Back row (L-R): Lim Siong Pew, VP, Corporate Quality & Environmental, Health & Safety; Gregory Ong, Director, IT
Front row (L-R): Susan Lee, VP, HR Singapore; Doreen Houghton, VP, Purchasing & Logistics
Photo: Willy Yeo To support Hyflux’s growth strategies As described by Hyflux’s Group Deputy
and innovative platforms, the Group CEO & CFO, Sam Ong: “They work
has been investing – continuously and with diligence, practicality, prudence
systematically – in our human capital. and respect. More importantly, they
are committed and work with the
Our manpower strength has grown in company at heart.”
tandem with our business operations.
In the last two years, the Group’s staff So, together with Hyflux’s closely-knit
had expanded by two folds, increasing workforce around the world, we will
to 1,899 as at December 2008. make things happen.
To meet the needs of our recurring Educational Qualifications

Photo: Elsie Koh O&M operations, and also to support
our own expansion into the renewable 2%
resources management business, the 20% 8%
Group will continue to invest in both
the breadth and depth of our staff
strength globally.
In addition, as part of our human 2008

capital investment, the inaugural
CEO Award was launched in 2008 to
recognise outstanding individuals. A 34%
total of five staff from our Singapore,
Group photo of Hyflux Group CEO, Algeria and China offices were 36%
Board of Directors and the five CEO honoured not only for their significant
Award recipients. Front row (L-R): Hacene work contributions, but also for Below Diploma Masters
Debbah, GM, North Africa; Edwin Lau, their team spirit, as well as their
Investment Manager; Dr Li Dong Fei, VP, Diploma PhD
commendable personal attributes
Process Technology; Li Qiuyu, Deputy GM
such as humility, sincerity and integrity. Degree
– Legal/Contract (China); Dr Wei Xi, Senior
Research Fellow
Corporate Social Responsibility
We have laid strong foundations for these Corporate Social

Responsibility programmes and are well positioned for deeper and
even more meaningful engagement to improve the well-being of
our community.
At Hyflux, we believe in the importance Canada, the U.S. and other parts of
of engaging in sustainable practices the world to share Hyflux’s success
in our community, particularly in the story and their personal working
areas of education, entrepreneurship, experiences.
and the environment (the “three E’s”).
In addition, we also support selected Environment
programmes that help improve the For our environment engagement
welfare of the elderly and children in programme, the Group worked with
our community. several environmental organisations
and institutions such as the National
Through ongoing corporate Environmental Agency (NEA) and the
volunteerism, financial support, and Singapore Institute of International
partnerships with governmental, Affairs (SIIA) on projects to help raise
educational and non-profit public awareness on topics such
organisations, we helped address as climate change and renewable
many emerging and challenging resource management.
issues in the communities in which
we operate. Community Welfare
There are many elderly people
Education
and children who are in need of
As part of the Group’s initiative in special care services in our society.
the realm of education, we teamed We supported fund raising events
up with Singapore polytechnics that benefit senior citizens’ homes,
and educational institutions to childcare, and in-patient care
provide awards and scholarships organisations.
for outstanding students in the
fields of Business, Chemistry and We have laid strong foundations for
Environmental Studies. Some these Corporate Social Responsibility
scholarships also include attachment programmes and are well positioned
and internship opportunities at the for deeper and even more meaningful
Hyflux headquarters. engagement to improve the well-
being of our community.
Entrepreneurship
In the area of entrepreneurship,
Hyflux supported global student
entrepreneurship programmes. Our
Senior Management team hosted (Top-Bottom): Assisi Hospice Charity
students from China, Japan, England, Christmas Dinner; National Environment
Agency Youth Eco Concert; Visit to Hyflux
by National University of Singapore
Entrepreneurship Society, BizAsia
Programme
Awards and Accolades
Innovation
Frost and Sullivan – Technology Global Water Awards 2006 – International Aquatech Innovation
Innovation of the Year Award 2007, Water Company of the Year Awards 2006, Category Winner
Desalination Technologies
(Asia Pacific) Hyflux was named “Water Company of Hyflux’s joint venture in Europe -
the Year” – the highest honour at the Hyflux CEPAration, won in the Water
The award recognised Hyflux for Global Water Awards 2006. This award, Treatment / Point of Use category,
the development of our proprietary given by the Global Water Intelligence, for our InoCepTM ceramic membrane.
KristalTM membrane technology. The UK, recognised the significant The judging panel consisted of
KristalTM membrane has a proven contribution of Hyflux to the private an international jury of experts,
track record in the treatment of water water industry. The judges’ verdict: and InoCepTM won amidst strong
and wastewater for industrial and “Hyflux has brought a professionalism competition from Europe, North
municipal markets, as well as in water and entrepreneurial spirit to the water America and Asia for its originality,
recycling and seawater desalination. industry which sets a new standard for practicality (technical, economical,
competitors worldwide.” feasibility) and sustainability
Frost and Sullivan – Technology (environment, security, energy
Innovation of the Year Award Global Water Awards 2006 – and efficiency).
2007, Residential Water Treatment Distinction Award for Desalination
Equipment Market (Southeast Asia) Plant of the Year
Hyflux was recognised for our lifestyle In 2006, the SingSpring Desalination
consumer product known as Plant was awarded the Distinction
dragon-flyTM. Award for “Desalination Plant
of the Year” at the Global Water
Awards given by the Global Water
Intelligence, UK. The judges noted:
“The Tuas plant is a brilliant work of
engineering which has challenged the
global perception that desalination is a
high cost source of water.”
Awards and Accolades (cont’d)
Business Excellence
SIAS Investors’ Choice Awards – Fastest Growing 50 – Fastest

Most Transparent Company Award Growing 50 Certification
2004, 2005, 2008 Awards 2005
Hyflux won the “Most Transparent Hyflux was recognised as one of the
Company Award” in the services/ 50 fastest growing companies in
utilities/agriculture category of the Singapore. The Awards were ranked by
Securities Investors Association DP Information Group, and supported
(Singapore) Investors’ Choice Awards by Ernst & Young, IE Singapore, and
in 2004, 2005 and 2008. SPRING Singapore.
Forbes Asia – Best Under A Billion Community

2005 & 2006
Friend of the Arts Award 2007
Forbes Asia’s annual “Best Under
A Billion” selections showcase the Hyflux received the “Friend of the Arts
region’s most dynamic publicly Award” given by the National Arts
traded firms with sales under Council in 2007 in recognition of our
US$1 billion a year and track records contributions towards the promotion,
of sustained growth and profitability. organisation, and participation of Sam Ong, Hyflux Group Deputy CEO &
For two consecutive years, Hyflux was artistic activities. CFO received the “Best Under A Billion”
award conferred by Forbes Asia
named as one of Asia’s top 200 small
& midsize companies. Arts Supporter Award 2008
Hyflux was presented with the

National Arts Council – “Arts
Supporter Award 2008”. The award
recognises sponsors who have
contributed towards Singapore’s
arts scene.
20 Years in Review - Key Milestones
1997
1989
1999
1989 Early 1990s Birth of KristalTM
Founded as Distribution & membranes
water trading provision of water 1997 1998
company treatment systems Singapore: Malaysia:
known as Siemens Ramatex Industrial
Hydrochem (S) Matsushita/ Sdn Bhd 1999
Pte Ltd EPCOS (S) Supply & installation of Singapore:
1994 Pte Ltd raw water nanofiltration Jurong Bird Park
Supply & treatment system Supply &
Entered China Market
installation installation of
China:
of ultra-pure reclamation plant
Hewlett Packard
dicing water filtration and
(Shanghai) Co. Ltd.
system, reverse osmosis
1994 chemical
Supply & installation of
systems for pond
pure water treatment
Singapore: delivery top-up and
system
Varta-Toshiba system other uses
Batteries Pte Ltd and waste Hyundai Electronics
Supply & installation treatment (Shanghai) Co. Ltd.
of nanofiltration system Supply & installation of
water recycling plant (multi-phase pure water treatment
project) system
Key Corporate Developments

Key Project Wins
Key Awards and Accolades
Initial Years A Strong Home Base
Project win: Singapore Jurong Bird Park
Hydrochem office
20 Years in Review - Key Milestones (cont’d)
2002
2001
Listed on Singapore 2002
Exchange Limited (“SGX”)
Singapore:
2000 Public Utilities Board
Malaysia: Chestnut Avenue Waterworks
Flextronics International Supply of membrane filtration system for the
Supply, installation &
2001 expansion of potable water treatment works;
commissioning of water Singapore: one of the largest membrane-based water
treatment plant Public Utilities Board treatment plants at that time
Bedok NEWater Plant
Malayan Sugar Supply & installation of Public Utilities Board
Manufacturing high grade industrial Seletar NEWater Plant
Supply & installation water reclamation Design & construction of high grade water
of brine regenerant process plant reclamation plant; utilisation of Hyflux
recovery plant proprietary membrane KristalTM 300 for
Wyeth Nutritional (S) municipal recycling
China: Pte Ltd
Amway (China) Co. Ltd. Supply & installation of China:
Supply & installation of mechanical piping and Molex Interconnect (Shanghai) Co. Ltd.
purified water treatment electrical connections for Supply & installation of pure water treatment
system and high purity water treatment plant system
distribution piping Namibia:
Wyeth Pharmeutical (S)
Pte Ltd Ramatex Textiles Namibia (Pty) Ltd
Supply & installation of Supply & installation of ultrafiltration,
process and utility piping nanofiltration & reverse osmosis plants
& fittings and process
equipment
Installation at Bedok NEWater Plant
First-generation
KristalTM membrane
2003
2003 2004
Singapore: Entered Middle Eastern Markets
Public Utilities Board 2005
SingSpring Desalination Launch of membrane R&D centre, one of Asia’s largest
China:
Plant Huaneng International
Design, construction, Power Co., Ltd
operations & Supply & installation of reverse
maintenance of one of 2004 osmosis system
Asia’s largest seawater Indonesia:
reverse osmosis plants at Dubai:
Cargill
136,000 m3/day capacity. Nakheel LLC
Supply of containerised ultrafiltration and reverse
This is Singapore’s Design, construction,
osmosis system for river water treatment
first Public Private operations & maintenance
Partnership. China: of sewage treatment plant
Famatong Connector (China) Co., Ltd and industrial wastewater
Supply & installation of pure water treatment system treatment plants
and sewage recovery system
2003 People’s Government of Tianjin City, Dagang District
Euromoney named Tianjin Dagang Desalination Plant
SingSpring financing Awarded contract to build China’s largest membrane- 2005
project “Asia Pacific Water based seawater reverse osmosis plant at Tianjin Hyflux CEO Olivia Lum named
Deal of the Year” Dagang on a Design-Build-Own-Operate-Transfer “Businessman of the Year 2004”
(“DBOOT”) basis at the Singapore Business
Asiamoney named
Awards 2005
Hyflux “Best Small
Company in Singapore”
Smart Investor magazine
named Hyflux “Most
Admired SESDAQ
Company”
Expanding Into Regional Markets

(L-R): Kanagarethinam Ravichandran, GM,
Sales & Marketing (India) and Kishor Dobariya,
GM, Technology & Business Development are
responsible for Hyflux’s trust into India.
(L-R): Hyflux Group CEO Olivia Lum

(L-R): Lim Choon Noi, GM, Lube
and Algerian Minister of Energy
Groundbreaking of Tianjin Dagang Oil and Dr Tan Yi, VP, Technology
& Mines, Dr Chakib Khelil, at the
Desalination Plant Development, are part of Eflux’s
signing ceremony for the Magtaa
core team
project
2008
2006 2008
Acquired CEPAration BV (The Netherlands) Participated in inaugural Singapore
2007 International Water Week
Hyflux’s oil recycling company - Eflux
Singapore Pte Ltd Launch of Hyflux Water
Trust (“HWT”), the first
Entered India Market pure-play water trust in Asia
Joint Venture with 2008
Marmon Water LLC for Algeria:
our consumer products Algeria Energy Company
2006
business Magtaa Desalination Plant
Algeria: Awarded contract to build world’s largest
Algeria Energy Company seawater reverse osmosis desalination plant
Tlemcen Desalination Plant in Magtaa on a DBOOT basis
Awarded contract to build 200,000
m3/day seawater reverse osmosis 2007
desalination plant in Tlemcen on a “Technology Innovation
DBOOT basis of the Year” (Desalination 2008
Technologies) awarded by
“Most Transparent Company Award”
Frost & Sullivan
at SIAS 9th Investors’ Choice Awards (was
2006 also awarded in 2004 and 2005)
“Water Company of the Year” and Hyflux Water Trust’s Initial Public Offering
Distinction Award for “Desalination (“IPO”) won the Highly Commended Award
Plant of the Year” at the Global Water for “Water Deal of the Year” at the Global
Awards 2006 Water Awards 2008
Global Player
(L-R): Kelly Leong, VP, Finance & Administration (R): Dr Govindharaju Venkidachalam, VP, Technology Research
(Malaysia); Yeow Kok Kon, GM, Energy-Biofuel, & Acquisition, receiving the Frost & Sullivan’s “Technology
oversees the development of the Palm Oil Membrane Innovation of the Year (Desalination Technologies)” award
System (POMS) business in Malaysia.
Hyflux participated in the inaugural

Singapore International Water Week
as one of the Founding Sponsors
Spirit of
Innovation
At Hyflux, we make things happen.
Innovation (cont’d)
Hyflux continuously strives to deliver testimonial solutions for the

sustainability of water and other natural resources.
Spirit of Innovation
Engineering,
Procurement &
Research & Capital
Construction (“EPC”)
Development Management
and Operations &
Maintenance (“O&M”)
Positive
Dynamic Water
Environmental Sustainable Growth
Company
Fundamentals
At the core of Hyflux’s culture is a spirit Research & Development wastewater treatment, water recycling,
of innovation and entrepreneurship. Hyflux’s research programmes identify seawater desalination, to oil recycling,
It inspires the Group in the innovative ways to achieve cost and palm oil clarification and other liquid
advancement of our technological energy efficiencies in the recycling separation requirements.
developments, achievement of water and other renewable energy
of operational excellence and resources in our key markets in Our in-house Research & Development
commercialisation of our applications. Southeast Asia, China, India and the (“R&D”) capabilities enable Hyflux to
Middle East and North Africa achieve speed-to-market advantage,
These competencies help to solidify (“MENA”) region. and further drive technological
Hyflux’s position as a dynamic global advances in membrane applications.
player. The Group continuously strives At the heart of the Group’s ongoing
to deliver testimonial solutions for research is the development of
the sustainability of water and other cutting-edge membrane technologies,
natural resources, backed by strong serving the needs of our municipal
financial capabilities. and industrial clients, from water and
Innovation (cont’d)
Engineering, Procurement & cost efficiencies through greater

Construction and Operations resource optimisation. Hyflux’s
& Maintenance capital management model has
been specifically developed to
Over the years, Hyflux has honed
capture market opportunities while
Engineering, Procurement &
maintaining cost effectiveness in the
Construction (“EPC”) capabilities to
global arena.
support the increasingly demanding
designs of our water plants.
A Dynamic Company
SingSpring Desalination Plant –
Our reliable 24/7 Operations & In recent years, growing water
Singapore’s first
Maintenance (“O&M”) services – pollution concerns have greatly Designed capacity: 136,000 m3/day
delivered to our own plants or to accelerated the need for quicker Completion: September 2005
clients’ plants – is growing into a delivery of water treatment strategies.
meaningful stream of steady and The desalination and water treatment
recurring revenue. Given the scalability industry is indeed one of the most
of our operations, we derive significant crucial infrastructure sectors, serving
cost advantages in the execution of the need for clear, clean water globally.
our order book.
Hyflux’s proven track record and
Capital Management technological excellence meet this
global need and are the key driving
In addition to our technological
forces behind our landmark projects in
capabilities and technical know-
Singapore, China and Algeria. Tianjin Dagang Desalination Plant –
how, the Group takes a multilateral
China’s largest
approach to our capital management
Our EPC order book stood at S$1.15 Designed capacity: 100,000 m3/day
with the establishment of a Expected completion: 2nd Half 2009
billion in FY2008, reflecting the
business trust and synergistic
Group’s capacity and capability to
partnerships worldwide.
secure large water plants worldwide.
Our strong EPC order book will
The business trust – Hyflux Water Trust
provide the Group with immediate
– launched in December 2007, enables
financial visibility as we focus on order
the Group to recycle capital to fund
book execution.
new projects.
Upon the plants’ completion and
Synergistic partnerships, formed
operations, our O&M contracts are
through our participation in Algeria,
the basis of robust recurring earnings,
value-add to our Design-Build-Own- Tlemcen Desalination Plant –
generating stable and recurring
Operate-Transfer (“DBOOT”) projects in First project win in Algeria
revenue for the next 20-30 years.
the country. Designed capacity: 200,000 m3/day
Expected completion: 2010
Under the current challenging
economic climate, it is ever more
critical for companies to achieve
Divider (L-R): Dr Wei Xi, Senior Research Fellow; Yap Kiam Wu, Senior Manager, Water Technology; Dr Shieh
Jyh-Jeng, VP, Research; Leslie Chapple, Group Technology Director; Dr Li Dong Fei, VP, Process Technology;
Dr Rinse Terpstra, MD & Chief Technology Officer, Hyflux CEPAration BV; Dr Wang Shaofeng, Senior Research World’s largest membrane-based
Fellow; Roland Low, Director, Technology Commercialisation; Dr Peng Zanguo, Research Fellow; Dr seawater desalination plant in
Govindharaju Venkidachalam; VP, Technology Research & Acquisition; Dr Zhou Tong, Senior Research Fellow Magtaa, Algeria
Divider Photo: Yoong Kang Chee Designed capacity: 500,000 m3/day
Expected completion: 2011
Research &
Development
Our network of R&D centres span across Singapore,
China and The Netherlands, enabling the Group to
broaden and tap into a worldwide base of ongoing
membrane developments.
Research & Development (cont’d)
Hyflux’s in-house R&D is continuously pushing for new membrane

applications, membrane products and systems.
Research & Development (“R&D”) is advantage. A recent investment

an integral part of Hyflux’s overall includes an advanced simulation
business strategy in driving sustainable programme, which analyses the
growth for ourselves and our clients effects of temperature and pressure on
around the world. materials used, and the computation
of fluid dynamics. These added data
Hyflux undertakes research into both points are designed to better assist
organic and inorganic membranes. our researchers in accelerating the
The Group’s extensive range of development process.
environmentally-friendly membrane
products and systems is a result of the Some of the Group’s key development
cross-fertilisation of our R&D efforts, efforts include:
while leveraging on the strength of
our technology commercialisation • Membrane applications in water
infrastructure, from the perspective of and other liquid separation
cost competitiveness, clients’ needs
and growth opportunities. • Module development
Our R&D Programmes • Process development for pre and/or

As part of the Group’s continuous filtration processes
emphasis and effort in reducing
• Development of specialty materials
development cycle, the team utilises
such as L-lactic acid
appropriate and latest technologies
to achieve speed-to-market
Dr Li Dong Fei, VP, Process Technology,

doing a test at Hyflux’s R&D lab
The Hyflux team, led by Group Deputy CEO & CFO Sam Ong (fourth from left), visiting a client’s plant where
our Palm Oil Membrane System (POMS) has been installed.
Photo: Peng Yi Jin
Our R&D ActivitIes
Process
development /
Small- and large- optimisation Niche applications
scale pilot plants development
Collaboration with
Sustained Growth academia, research
Engineering design Through R&D institutes and
research partners
Product Materials &

Characterisation
development membrane research
and analytical
methods
development
Our R&D Centres Our Membrane Modules product development to module

In 2004, Hyflux launched one of and Systems Manufacturing making. As a result, we are now able
Asia’s largest membrane and materials Facility to meet the rapidly growing in-house
technology centres in Singapore demand, especially from our seawater
The Group has set up a manufacturing
to spearhead the development of desalination plant in Tianjin, China,
facility in Yangzhou, China, to supply
leading-edge membrane technology and the two sizable desalination
membrane modules and systems to
and environmental engineering plants in Algeria.
our plants worldwide. This enables
solutions. us to have better control over the
In addition, Hyflux is also now
quality and speed with which Hyflux’s
Our network of R&D centres span better positioned to meet growth
membrane modules are deployed to
across Singapore, China and The opportunities in the global
our respective plants on time and in
Netherlands, enabling the Group to membrane market.
pristine working conditions.
broaden and tap into a worldwide
base of ongoing membrane Our Membrane Production
developments through linkages and Facilities
collaboration with internationally-
recognised research experts, In recent years, Hyflux has been
universities and various research streamlining and improving our
institutions. membrane production processes
to ensure quality consistency from
Divider (L-R): Dr Shieh Jyh-Jeng, VP, Research; Roland Low, Director, Technology Commercialisation; Dr Govindharaju Venkidachalam, VP,
Technology Research & Acquisition
Our Membrane Products and Applications
Hyflux’s in-house R&D is continuously the most widely utilised ultrafiltration content. It is ideal for waste/
pushing for new membrane pretreatment membrane for seawater wastewater treatment and can be used
applications, membrane products and desalination in the world. to resolve separation bottlenecks in a
systems. Our R&D efforts have led to wide range of industries, such as the
the successful commercialisation of FerroCep™ Stainless Steel metal/steel mill, chemical process, food
our membrane products and systems: Tubular Membrane & beverage, and biopharmaceutical
The tubular cross-flow technology industries. The robust design of
Kristal™ Polymer Hollow Fibre and stainless steel construction the InoCep™ membrane combines
Membrane are the main reasons why Hyflux’s the advantages of high chemical,
One of the pioneer products, Kristal™ FerroCep™ is the membrane of mechanical and thermal resistance, as
polymeric hollow fibre membrane choice for handling difficult industrial well as the compactness and low cost
is fully designed and developed streams with high viscosity and solid of that of polymeric hollow fibres.
by Hyflux using our proprietary contents under extreme conditions.
membrane technology. It is used in It is ideal for fermentation broths like PoroCep™ Polypropylene
the treatment of aqua-based industrial amino acids, antibiotics, vitamins Hollow Fibre Membrane
waste stream, water purification, and clarification. This inert and highly This membrane is the preferred
wastewater recycling, and seawater durable inorganic membrane can choice for microfiltration, where both
desalination pretreatment. withstand elevated temperatures and performance and cost are critical. It
pressures, concentrated solvents or combines higher particle retention
Our flagship and award-winning extreme pH conditions. with higher flux, and ensures excellent
Kristal™ membrane has been utilised in permeate quality and minimal pressure
the ultrafiltration process in the Seletar InoCep™ Ceramic Hollow drop, all within a small compact
NEWater Plant in Singapore and will be Fibre Membrane design. The PoroCep™ membrane
installed in our landmark desalination The award-winning InoCep™ offers advantages such as broad
plants in Tianjin, China and Magtaa and membrane is able to tolerate high chemical compatibility, wide pH range,
Tlemcen in Algeria. With the operation temperatures and extreme pH great thermal stability and mechanical
of the Magtaa plant, Kristal™ will be conditions as well as high solids strength. The PoroCep™ membrane is
FerroCepTM
KristalTM
InoCepTM
hence ideal for pre-filtration in a wide Our Consumer Products

variety of highly demanding industrial Besides serving our municipal and
water, wastewater and chemical industrial clients, the Group has also
treatment operations. incorporated both our proprietary and
licensed technologies into our suite of
Hyflux Advanced Membrane consumer products. This ranges from
System (“HAMS”) the innovative “air-to-water” machine
Our proprietary Hyflux Advanced that converts moisture to pure water
Membrane System (“HAMS”) has for indoor use, to contemporary water
been developed as a “green” solution filtration appliances for home and
(L-R): Leslie Chapple, Group Technology
to recover base oil from used oil. office use, as well as our portable
Director; Willy Yeo, AVP, Business
It substantially reduces energy outdoor devices suitable for adventure, Development
consumption during the recycling of emergency and military use. Photo: Yoong Kang Chee
used oil into high-grade commercial
base oil. In addition, Hyflux has also set up
a joint R&D centre with Marmon
Palm Oil Membrane System Water LLC, one of the world’s largest
(“POMS”) manufacturers of residential and
Hyflux has developed a first-of-its- commercial water treatment systems.
kind membrane system for palm oil This joint venture will develop new
clarification. The Palm Oil Membrane water treatment and filtration products
System (“POMS”) is a sustainable palm for the Asian market.
oil processing system that substantially
steps up crude palm oil recovery and
reduces wastewater discharge. (L-R): Cindi Ng, GM, Consumer Products;
Steve Dakolios, VP & GM, Hyflux Marmon
Development Pte Ltd; Michael Repasky,
Product Manager, Hyflux Marmon
Development Pte Ltd
Gurgle F38
PoroCepTM Dragon-flyTM
Pitcher P18
Engineering,
Procurement & Construction and
Operations & Maintenance
Hyflux is the partner-of-choice for the entire
value chain: from the onset of design to plant
testing and commissioning.
EPC and O&M (cont’d)
Having built and commissioned numerous plants, Hyflux has

amassed invaluable in-depth experience in operating and
maintaining commercial plants of various sizes and applications
in different locations worldwide.
Our EPC Capabilities capacity of 500,000 m3/day in

An ISO 9001-2008 certified company, Magtaa, Algeria.
Hyflux is the partner-of-choice for
the entire value chain from the Pilot Plants To Commissioning
onset of design to plant testing and Hyflux has built up a core team to
commissioning. This enables Hyflux spearhead the upscaling of our water
to shorten the design-to-product and liquid separation solutions on a
cycle while achieving a seamless and commercial level. This typically entails
integrated process flow. At the same the development of a pilot test plant
time, Hyflux is rapidly expanding (which includes process design,
our portfolio of renewable resources construction and testing) - either
management with the oil recycling, shipped to our clients’ premises or
palm oil and L-lactic acid plants as conducted in our laboratories with our
recent completions. clients’ approval.
Our water portfolio boasts a Testing and commissioning are the key
robust pipeline of more than emphasis and critical path within the
40 plants, including the world’s EPC value chain leading up to the final
Tommy Chia, Project Director, Algeria, largest membrane-based seawater stage in launching the plants. Hyflux’s
inspecting our plant in Tlemcen. desalination plant with a designed specialist teams conduct guaranteed
Photo: Tommy Chia
Securing Water Plants With Larger Capacities Over the Years (Designed Capacity)
Langfang, China Magtaa, Algeria

Wastewater Recycling Plant (2006) Desalination Plant (2008)
(500,000 m3/day)
(80,000 m3/day) 500,000 m3/day
Tlemcen, Algeria
Seletar, Singapore 200,000 m3/day Desalination Plant (2006)
NEWater Plant - Wastewater (200,000 m3/day)
Recycling (2002)
(40,000 m3/day)
100,000
Tuas, Singapore
Bedok, Singapore
m3/day SingSpring Desalination Plant (2003)
NEWater Plant - Wastewater (136,000 m3/day)
Recycling (2001)
(32,000 m3/day)
Tianjin Dagang, China
Desalination Plant (2004)
(100,000 m3/day)
EPC and O&M (cont’d)
Full Suite of EPC and O&M Services
Design &
Industry Players Manufacturing Systems Project Operations &
Development
of Components Assembly Management Maintenance
(R&D)
• Engineeering
Consultants
• Component
Suppliers
• Project Managers
• System Integrators
• Operators
TM
performance and plant availability Our SingSpring Desalination Plant – EPC and O&M
tests to ensure that the plants meet Singapore’s first membrane-based
the stringent safety standards. seawater desalination facility – has
Order Book
achieved high levels of energy and
Our Recurring O&M operational efficiencies. The plant Increasing EPC and
Earnings Base has received a Distinction Award for O&M Order Book
Having built and commissioned “Desalination Plant of the Year” at the
numerous plants, Hyflux has amassed prestigious Global Water Awards 2006. S$m
invaluable in-depth experience in This bears testimony to our holistic 335
approach towards design, with equally 1500
operating and maintaining commercial
plants of various sizes and applications strong emphasis on life cycle cost
254
in different locations worldwide. and efficiency.
1000 1,145
Our multi-disciplinary teams, O&M is now emerging as a meaningful 166 863

comprising experienced industry contributor to the Group’s earnings
500
veterans, provide ongoing 24/7 base. We expect our O&M business
435
operations and maintenance (“O&M”) to grow further as more pipeline
services and support to our global plants are being completed. The 0
clients. Our ability to operate and O&M business will provide the Group 2006 2007 2008
maintain plants at optimal levels, with a steady and growing stream of
while continuously striving for higher recurring revenue as the majority of
operational efficiencies, has won us the O&M contracts are locked-in over EPC
international recognition. the 20-30 year concession period. O&M*
* To be recognised over the next

20-30 years
Divider (L-R): Bruce Sim, VP, Engineering; Gan Teck Ee, GM, Inorganic Membrane Production;
Jennifer Hoalim, GM, Inorganic Membrane Production; Lee Chee Khian, Director, Corporate
Commercial & Contracts
Capital
Management
Hyflux’s capital management mechanism allows
the Group to unlock the intrinsic value of our water
assets to ensure an optimal capital structure for
long-term business growth.
Capital Management (cont’d)
Through Hyflux Water Trust, Hyflux can recycle our capital for the
Group’s business expansion.
Hyflux’s success is also supported by Through HWT, Hyflux can recycle

our prudent capital management our capital for the Group’s business
approach which has enabled the expansion. For investors, HWT provides
Group to invest and strengthen our a recurring and visible yielding
competitive position in strategic investment option as it continues to
markets such as China and Algeria. access Hyflux’s project pipeline while
leveraging on our already established
Our capital management mechanism network, market reach and experience,
allows the Group to unlock the intrinsic know-how, membrane technologies
value of our water assets to ensure an and Operations & Maintenance
optimal capital structure for long-term (“O&M”) expertise.
business growth.
Symbiotic Strength between
Capital Recycling - Hyflux Hyflux and HWT
Water Trust HWT provides investors with an
In 2007, Hyflux launched the first opportunity to invest in water-related
Langfang Water Recycling Plant pure-play global water business trust infrastructure assets in China, India, the
Designed Capacity: 40,000 m3/day – Hyflux Water Trust (“HWT”). It is a MENA region, and other high-growth
Completion: Nov 2008 business trust listed on the Singapore markets globally.
Exchange Limited, sponsored by
Hyflux and managed by Hyflux Water The plants operate under long-term
Trust Management Pte Ltd. concession agreements, which give
HWT exclusive rights to provide
water-related services to industrial
Liaoyang Wastewater Treatment Plant

Designed capacity: 20,000 m3/day
Completion: Dec 2007
Capital Management (cont’d)
Our Capital Management Model
Synergistic Cost-Effective
Capital Recycling
Partnerships Capital Raising
and municipal users in their respective Strategic Investors & Joint Breakdown of
concession areas. The 20-30 year Partnerships Fuelling Growth
concessions provide long term, steady
membrane markets
and predictable distribution to the
Another growth strategy involves for 2009
forming joint ventures with local
unitholders. partners and municipal governments,
with pre-determined project financing. US$4.0b
HWT has certain Rights Of First Offer US$2.6b
And First Refusal (“ROFOAR”) to For example, Hyflux entered into
purchase existing and future water- two synergistic partnerships for our
related infrastructure assets from seawater desalination projects in
Hyflux, subject to the terms and Algeria. The first being a15% equity
conditions in the ROFOAR Deed. partnership with KLSE-listed Malakoff
Berhad and the Algeria Energy
At the time of printing, HWT has a
Company (“AEC”), the government
portfolio of 17 plants in China across
company involved in handling the
three asset types, comprising water US$2.5b
power and water privatisation exercise
treatment, wastewater treatment
in Algeria.
and water recycling plants - with RO Systems and Modules
a combined designed capacity of This synergistic Public Private Microfiltration (“MF”) Systems
580,000 m3/day. These plants are Partnership enabled the Group to
largely located in high growth, coastal Ultrafiltration (“UF”) Systems
leverage on the municipal networks in
provinces in China. Algeria while extending Hyflux’s global Source: The Mcilvaine Company
growth strategy in the municipal
sector.
Divider (L-R): Goh Soo Fung, VP, Finance; Peggy Lim, Director, Compliance & Secretariat;
Joyce Ong, Director, Accounting; Joscelyn Tan, Director, Legal (Corporate Finance)
Sustainable
Growth Model
Hyflux is well positioned to benefit from the
promising growth prospects of the water sector.
Sustainable Growth Model (cont’d)
The global demand for clean water offers tremendous business

opportunities in the key markets we currently operate in, particularly
China and Algeria.
Proven business model. Sound Water Industry: An Attractive currently operate in, particularly China
management expertise. Technological Proposition and Algeria. The Chinese and Algerian
leadership. Experienced engineering According to GWI Desal Markets 2007, Governments have implemented
know-how. Positive macro economics. the projected growth of installed stimulus packages to support
These are the key contributing factors desalination capacity worldwide is infrastructure developments to resolve
to Hyflux’s phenomenal growth in the expected to grow by 9.3% per annum severe water shortages.
past 20 years. to 2015.
Entrenched China Presence
Hyflux is therefore well positioned to The global demand for clean The Chinese Government has put
benefit from the promising growth water offers tremendous business in place its 11th Five-Year Plan,
prospects of the water sector. opportunities in the key markets we committed to an investment of RMB
Increasing Growth of Installed Desalination Capacity Worldwide
• The Middle East • China is expected to grow to

remains the become the third largest market
largest market for for desalination
desalination
• The Chinese Government plans to

accelerate the use of desalinated
seawater during its 11th Five-Year
Plan Period (2006-2010)
• Expected volumes for China in the

medium term are 800,000m3 to
1 million m3 of seawater throughput
per day
• Current state of China’s water

infrastructure is seen as a major
limitation on its economic growth
60%
36%
Proportion of world fresh water supply
11% 13% on continent
5% (<1%) Proportion of world population residing
on continent
Asia Africa Australia and Oceanic
Source: UNESCO/HP Regional Office of Latin America and the Caribbean

Sustainable Growth Model (cont’d)
Algeria’s Growth
Potential
Historical and Future

Desalination Capacity
2.0
Capcaity, million m3/d

1.5
1.0
Our core team in China (L-R): Stephen Yee, GM, Hyflux Investment Consultancy Management Service
(Tianjin) Co., Ltd (“HMC”); Gan Boon Len, GM, EPC China; Choo Wing Tai, GM, Sinolac (Huludao); Robert 0.5
Lim, VP, Business Development; Gan Ying Hao, GM, HMC; Tan Yu Ming, GM, O&M, China
Photos: Yoong Kang Chee, Jenson Goh 0
1991 1996 2001 2006
to to to onwards
1 trillion. In addition to urban needs, it As one of the most water-stressed 1995 2000 2005
aims to provide potable drinking water countries in the world, Algeria presents
to all rural residents by 2010. huge growth opportunities in seawater Proposed
desalination for the Group. Contracted
Hyflux is one of the early pioneers
in China’s water sector since 1994. In April 2008, Hyflux won the bid – Source: GWI DesalData
Hyflux currently employs over 1,000 amidst intense competition from
local Chinese employees, including international players – to build the
a dedicated network of sales and world’s largest membrane-based
business development personnel. We seawater desalination plant in Algeria. Capacity Expenditure by
have acquired in-depth knowledge of This landmark win has helped the Technology
the local regulatory and commercial Group to surge ahead in the global
US$0.19b
policies, as well as strong relations with water landscape. US$3.19b
local governments.
Growing Presence in India
As a result, Hyflux today, has a robust We made our foray into the Indian
pipeline of more than 40 water and market in 2006.
wastewater treatment, water recycling
and desalination plants in 26 provinces Hyflux’s presence in India has also
in China. been growing steadily over the years.
We have made good progress in
Entering the Algerian Market the sale of membrane products and US$0.29b
Hyflux entered the Algerian market customised membrane solutions to
in 2004. major industries. MED - Multiple Effect Distillation
MSF - Multi-Stage Flash Distillation
Since 2005, the Algerian Government Leveraging on our strength and the
RO - Reverse Osmosis
has implemented plans to build growing demand for clean water in
desalination plants to meet its needs India, we are also actively pursuing
Source: GWI DesalData
for clean water for industrial and seawater desalination and water
consumer use. treatment opportunities in the country.
Divider (L-R): Adrian Chong, Director, Internal Audit; Kum Mun Lock, VP, Investment; Cheong Aik Hock, VP,
Legal; Nah Tien Liang, Director, Investment
Financial Statements
Directors’ Report 49
Statement by Directors 55
Independent Auditor’s Report 56
Balance Sheets 58
Consolidated Income Statement 60
Consolidated Statement of Changes in Equity 61
Consolidated Cash Flow Statement 63
Notes to the Financial Statements 65
Corporate Governance Statement 119
Supplementary Information 131
Statistics of Shareholdings 133
Substantial Shareholders 134
Notice of Annual General Meeting 135
Notice of Books Closure 148
Hyflux Group of Companies 152

Photo by Olivia Lum

Directors’ Report
We are pleased to submit this annual report to the members of the Company together with the audited financial
statements for the financial year ended 31 December 2008.
Directors
The directors in office at the date of this report are as follows:
Olivia Lum Group CEO, President and Managing Director

Teo Kiang Kok
Lee Joo Hai
Gay Chee Cheong
Christopher Murugasu
Raj Mitta
Professor Tan Teck Meng
Ahmed Butti Ahmed (Appointed on 25 April 2008)
Directors’ interests
According to the register kept by the Company for the purposes of Section 164 of the Companies Act, Chapter 50 (the Act),
particulars of interests of directors who held office at the end of the financial year (including those held by their spouses
and infant children) in shares, debentures and share options in the Company and in related corporations (other than
wholly-owned subsidiaries) are as follows:
Holdings in the name of Other holdings in which

the director, spouse or the director is deemed
infant children to have an interest
Name of director and corporation in which At beginning At end At beginning At end
interests are held of the year of the year of the year of the year
The Company
Ordinary shares
Olivia Lum 124,984,141 167,484,141 52,500,000 10,000,000

Gay Chee Cheong 450,000 450,000 – –
Christoper Murugasu 469,375 469,375 120,000 120,000
Professor Tan Teck Meng 10,000 10,000 51,000 51,000
Share options
Olivia Lum 5,250,000 5,250,000 – –

Teo Kiang Kok 250,000 250,000 – –
Lee Joo Hai 250,000 250,000 – –
Gay Chee Cheong 200,000 200,000 – –
Christoper Murugasu 360,937 360,937 – –
Directors’ Report (cont’d)
Directors’ interests (cont’d)
By virtue of Section 7 of the Act, Olivia Lum is deemed to have interests in the shares held by the Company in all its
subsidiaries, at the beginning and at the end of the financial year.
Except as disclosed in this report, no director who held office at the end of the financial year had interests in shares,
debentures or share options of the Company, or of related corporations, either at the beginning of the financial year, or
date of appointment if later, or at the end of the financial year.
There were no changes in any of the above-mentioned interests in the Company between the end of the financial year
and 21 January 2009.
Except as disclosed under the “Share Options” section of this report, neither at the end of, nor at any time during the
financial year, was the Company a party to any arrangement whose objects are, or one of whose objects is, to enable the
directors of the Company to acquire benefits by means of the acquisition of shares in or debentures of the Company or
any other body corporate.
Except for salaries, bonuses and fees and those benefits that are disclosed in this report and in note 43 to the financial
statements, since the end of the last financial year, no director has received or become entitled to receive, a benefit by
reason of a contract made by the Company or a related corporation with the director, or with a firm of which he is a
member, or with a company in which he has a substantial financial interest.
Share options
The Hyflux Employee Share Option Scheme (the Scheme) was approved and adopted by the members of the Company
at an Extraordinary General Meeting held on 27 September 2001. The Scheme provides an opportunity for employees
and directors of the Company and its subsidiaries, other than substantial shareholders of the Company, to participate in
the equity of the Company.
On 24 November 2003, the members of the Company approved a modification to the Scheme which allowed Olivia
Lum, Group CEO, President and Managing Director, a substantial shareholder of the Company, to participate in the
Scheme. The maximum entitlement of Olivia Lum is 10% of the total number of shares which may be issued by the
Company under the Scheme.
The Scheme is administered by the Remuneration Committee, comprising five directors. It shall continue to be in force
at the discretion of the Remuneration Committee for a period of 10 years from 27 September 2001. However, the period
may be extended with the approval of the members of the Company and to be consistent at a general meeting of the
Company and of any relevant authorities which may then be required.
Share options (cont’d)
Details of options granted to directors of the Company pursuant to the Scheme are as follows:
Aggregate options Aggregate options

Options granted (including exercised since Aggregate
granted bonus issue) since commencement options
during the commencement of of the Scheme outstanding as
financial the scheme to end to end of to end of
Name of director year of financial year financial year financial year
Olivia Lum – 6,375,000 (1,125,000) 5,250,000

Teo Kiang Kok – 250,000 – 250,000
Lee Joo Hai – 250,000 – 250,000
Gay Chee Cheong – 200,000 – 200,000
Christopher Murugasu – 862,500 (501,563) 360,937
Total – 7,937,500 (1,626,563) 6,310,937
Except as disclosed in this report, since the commencement of the Scheme to the end of the financial year:
• No options have been granted to the controlling shareholders of the Company and their associates;
• No participant has received 5% or more of the options available under the Scheme;
• No options have been granted to directors and employees of the holding company and its subsidiaries;
• No options that entitle the holder to participate, by virtue of the options, in any share issue of any other corporation
have been granted; and
• The exercise price of the options is set at the market price, as defined in the Scheme, at the time of grant. No options
have been granted as a discount.
52
Share options (cont’d)
At the end of the financial year, details of the options granted under the scheme on the unissued ordinary shares of the Company, are as follows:
Option No of holders
Date of grant Balance as at Options lapsed/ Options Balance as at as at Exercise
of options 01/01/2008 granted forfeited exercised 31/12/2008 31/12/2008 price Exercise period
$
15/10/2001 488,562 – (938) (163,000) 324,624 54 0.2688 15/10/2002 – 27/09/2011

11/01/2002 750 – – – 750 1 0.4123 11/01/2003 – 27/09/2011
28/03/2002 26,906 – – – 26,906 2 0.5436 28/03/2003 – 27/09/2011
08/04/2002 8,750 – – – 8,750 1 0.5401 08/04/2003 – 27/09/2011
08/07/2002 750 – – – 750 1 0.5664 08/07/2003 – 27/09/2011
01/08/2002 1,125 – – – 1,125 1 0.5888 01/08/2003 – 27/09/2011
16/09/2002 875 – (875) – – – 0.4869 16/09/2003 – 27/09/2011
07/01/2003 193,500 – – (168,000) 25,500 4 0.5995 07/01/2004 – 27/09/2011
07/04/2003 149,750 – – (37,000) 112,750 3 0.7253 07/04/2004 – 27/09/2011
16/10/2003 731,500 – – (180,000) 551,500 9 1.0581 16/10/2004 – 27/09/2011
08/12/2003 1,050,000 – – – 1,050,000 2 1.0197 08/12/2004 – 27/09/2011
Hyflux Ltd annual report 2008
29/12/2003 445,500 – (4,500) (100,000) 341,000 14 1.0627 29/12/2004 – 27/09/2011

14/05/2004 240,000 – – (120,000) 120,000 1 0.9600 14/05/2005 – 27/09/2011
07/02/2005 2,585,000 – (116,000) (282,000) 2,187,000 37 1.8600 07/02/2006 – 27/09/2011
03/05/2005 180,000 – (180,000) – – – 2.3227 03/05/2006 – 27/09/2011
09/05/2005 4,500,000 – – – 4,500,000 1 2.3067 09/05/2006 – 27/09/2011
01/06/2005 45,000 – (18,000) (9,000) 18,000 1 2.5493 01/06/2006 – 27/09/2011
08/06/2005 45,000 – – (18,000) 27,000 1 2.6507 08/06/2006 – 27/09/2011
28/03/2006 1,848,000 – (220,000) (396,000) 1,232,000 13 2.6620 28/03/2007 – 27/09/2011
18/10/2006 1,600,000 – (400,000) (140,000) 1,060,000 3 2.3620 18/10/2007 – 27/09/2011
07/12/2006 3,056,000 – (284,000) (238,000) 2,534,000 57 2.3720 07/12/2007 – 27/09/2011
05/04/2007 730,000 – (300,000) (20,000) 410,000 4 2.6240 05/04/2008 – 27/09/2011
23/05/2007 980,000 – (80,000) (20,000) 880,000 4 2.6080 23/05/2008 – 27/09/2011
25/09/2007 3,430,000 – (490,000) – 2,940,000 35 2.7920 25/09/2008 – 27/09/2011
26/05/2008 – 3,610,000 (210,000) – 3,400,000 62 3.6280 26/05/2009 – 27/09/2011
31/10/2008 – 6,995,000 – – 6,995,000 113 1.4720 31/10/2009 – 27/09/2011
22,336,968 10,605,000 (2,304,313) (1,891,000) 28,746,655 424
Warrants
By a Warrant Subscription Agreement dated 23 November 2004 supplemented by a Supplemental Warrant Subscription
Agreement dated 25 April 2008 (Agreements) entered into between the Company and Istithmar World PJSC (formerly
known as Istithmar PJSC) (Istithmar), Istithmar is entitled to subscribe for 41,216,863 ordinary shares in the Company,
subject to the terms and conditions of the Agreements and the Warrant Instrument. The exercise period is from April 2008
to April 2010.
The exercise price is equivalent to the higher of (a) S$1.95 and (b) the lower of 70% of the volume-weighted average price
for trades in the Company’s shares transacted on the Singapore Exchange on the market day immediately preceding the
exercise date or in the 30 calendar day period immediately preceding the exercise date.
Audit Committee
The members of the Audit Committee during the year and at the date of this report are:
Lee Joo Hai (Chairman)

Gay Chee Cheong
Teo Kiang Kok
Professor Tan Teck Meng
The members of the Audit Committee, collectively, have expertise and extensive experience in legal, accounting, financial
management and business, and are qualified to discharge the Audit Committee’s responsibilities.
The primary functions of the Audit Committee are as follows:
1. assists the Board in discharging its statutory responsibilities on financial and accounting matters;
2. reviews the financial and operating results and accounting policies of the Group;
3. reviews significant financial reporting issues and judgements relating to financial statements for each financial year,
interim and annual results announcement before submission to the Board for approval;
4. reviews the adequacy of the Company’s internal control (financial and operational) and risk management policies
and systems established by the Management;
5. reviews the audit plans and reports of the external and internal auditors and consider the effectiveness of the
actions taken by the Management on the auditors’ recommendations;
6. appraises and report to the Board on the audits undertaken by the external and internal auditors, the adequacy of the
disclosure of information, and the appropriateness and quality of the system of management and internal controls;
7. reviews the independence of external auditors annually and consider the appointment or re-appointment of
external auditors and matters relating to the resignation or removal of the auditors and approve the remuneration
and terms of engagement of the external auditors; and
8. reviews interested person transactions, as defined in the Listing Manual of the SGX-ST.
Audit Committee (cont’d)
The Audit Committee has held 4 meetings since the last directors’ report. In fulfilling its responsibilities, the Audit
Committee receives regular reports from the Management and the external auditors, KPMG LLP. The Audit Committee
has full access to and co-operation of the Management and meets with KPMG LLP in private at least once a year, and
more frequently, if necessary.
The Audit Committee has explicit authority within the scope of its responsibilities to seek any information it requires
or investigate any matter within its terms of reference. The Audit Committee has adequate resources to enable it to
discharge its responsibilities properly.
The Group has put in place a confidential communication programme as endorsed by the Audit Committee. Employees
may, in confidence, raise concerns about possible corporate improprieties in matters of financial reporting or other
matters and to ensure that arrangements are in place for the independent investigations of such matters and for
appropriate follow up actions. The details of the confidential communication policies and arrangements have been
made available to all employees.
The Audit Committee is satisfied with the independence and objectivity of the external auditors and has recommended
to the Board of Directors that the auditors, KPMG LLP, be nominated for re-appointment as auditors at the forthcoming
Annual General Meeting of the Company.
The auditors, KPMG LLP, have indicated their willingness to accept re-appointment.
On behalf of the Board of Directors
Olivia Lum
Director
Teo Kiang Kok

Director
10 March 2009
Statement by Directors
In our opinion:
(a) the financial statements set out on pages 58 to 118 are drawn up so as to give a true and fair view of the state of
affairs of the Group and of the Company as at 31 December 2008 and the results, changes in equity and cash flows
of the Group for the year ended on that date in accordance with the provisions of the Singapore Companies Act,
Chapter 50 and Singapore Financial Reporting Standards; and
(b) at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts
as and when they fall due.
The Board of Directors has, on the date of this statement, authorised these financial statements for issue.
On behalf of the Board of Directors
Olivia Lum
Director
Teo Kiang Kok

Director
10 March 2009
Independent Auditors’ Report

Members of the Company
Hyflux Ltd
We have audited the financial statements of Hyflux Ltd (the Company) and its subsidiaries (the Group), which comprise
the balance sheets of the Group and the Company as at 31 December 2008, the income statement, statement of
changes in equity and cash flow statement of the Group for the year then ended, and a summary of significant
accounting policies and other explanatory notes, as set out on pages 58 to 118. The financial statements for the year
ended 31 December 2007 were audited by another firm of Certified Public Accountants whose report dated 14 March
2008 expressed an unmodified opinion on those financial statements.
Management’s responsibility for the financial statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with
the provisions of the Singapore Companies Act, Chapter 50 (the Act) and Singapore Financial Reporting Standards. This
responsibility includes:
(a) devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that
assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised
and that they are recorded as necessary to permit the preparation of true and fair profit and loss accounts and
balance sheets and to maintain accountability of assets;
(b) selecting and applying appropriate accounting policies; and
(c) making accounting estimates that are reasonable in the circumstances.
Auditors’ responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are
free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity’s preparation and fair presentation of the financial statements 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 entity’s internal control. An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Independent Auditors’ Report (cont’d)

Members of the Company
Hyflux Ltd
Opinion
In our opinion:
(a) the consolidated financial statements of the Group and the balance sheet of the Company are properly drawn up in
accordance with the provisions of the Act and Singapore Financial Reporting Standards to give a true and fair view of
the state of affairs of the Group and of the Company as at 31 December 2008 and the results, changes in equity and
cash flows of the Group for the year ended on that date; and
(b) the accounting and other records required by the Act to be kept by the Company and by those subsidiaries
incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions
of the Act.
KPMG LLP
Public Accountants and
Certified Public Accountants
Singapore
10 March 2009
Balance Sheets
As at 31 December 2008
Group Company
Note 2008 2007 2008 2007
$’000 $’000 $’000 $’000
Non-current assets
Property, plant and equipment 3 56,857 62,573 8 7,612
Intangible assets 4 66,523 40,499 1,826 4,182
Investment property 5 2,244 2,373 – –
Investments in subsidiaries 6 – – 131,073 134,377
Investment in joint venture 7 – – 2,375 1,125
Investments in associates 8 94,716 85,783 12,608 12,277
Long-term investments 9 908 7,917 899 899
Financial and lease receivables 10 194,204 9,570 – –
Lease prepayments 11 4,939 – – –
Trade receivables 12 2,872 – – –
Due from related parties (non-trade) 13 36,326 – 19,832 18,833
Deferred tax assets 14 2,799 1,218 – –
462,388 209,933 168,621 179,305
Current assets
Gross amounts due for contract work 15 93,987 93,257 – 9,527
Inventories 16 33,827 20,641 – 17,498
Financial and lease receivables 10 3,248 187 – –
Trade receivables 12 41,017 46,110 16 1,148
Other receivables and deposits 17 41,313 34,773 1,574 3,377
Prepayments 1,868 3,549 913 1,327
Due from related parties (trade) 18 43,939 15,216 19,605 22,673
Due from related parties (non-trade) 13 23,394 4,787 339,969 155,412
Cash and fixed deposits 19 90,740 121,047 18,242 6,074
Assets classified as held for sale 20 10,834 – – –
384,167 339,567 380,319 217,036
Current liabilities
Trade payables 214,651 55,022 26 1,172
Other payables and accruals 21 22,252 17,747 4,208 3,304
Progress payments from customers 13,343 25,989 – 2,080
Interest-bearing loans and borrowings 22 50,245 5,245 49,524 5,000
Finance lease liabilities 22 99 104 – –
Due to related parties (trade) 23 6,458 – 58 845
Due to related parties (non-trade) 24 11,530 1,796 114,590 36,741
Tax payable 5,925 202 – –
Liabilities classified as held for sale 20 1 – – –
324,504 106,105 168,406 49,142
Net current assets 59,663 233,462 211,913 167,894
The accompanying notes form an integral part of these financial statements.

Balance Sheets (cont’d)

Group Company
Note 2008 2007 2008 2007
$’000 $’000 $’000 $’000
Non-current liabilities
Interest-bearing loans and borrowings 22 207,819 193,266 206,170 190,596
Finance lease liabilities 22 73 187 – –
Deferred tax liabilities 14 6,260 2,875 159 159
214,152 196,328 206,329 190,755
Net assets 307,899 247,067 174,205 156,444
Equity attributable to
equity holders of the Company
Share capital 25 99,118 95,820 99,118 95,820
Capital reserve 26 7,204 1,064 – –
Foreign currency translation reserve 27 9,257 (1,815) – –
Hedging reserve 28 (13,496) (4,222) – –
Employee share option reserve 29 12,971 9,419 12,971 9,419
Accumulated profits 182,493 139,506 62,116 51,205
297,547 239,772 174,205 156,444
Minority interests 10,352 7,295 – –
Total equity 307,899 247,067 174,205 156,444

Consolidated Income Statement

Year ended 31 December 2008
Note 2008 2007

$’000 $’000
Revenue 30 554,224 192,786

Changes in inventories of finished goods and work-in-progress 3,710 1,246
Raw materials and consumables (387,767) (107,244)
Personnel expenses (52,606) (33,852)
Depreciation, amortisation and impairment (9,718) (7,198)
Finance income 31 4,770 2,548
Finance expenses 32 (10,222) (8,878)
Fair value loss on derivative financial instruments (680) (3,532)
Share of (loss)/profit of associates, net of tax (1,400) 1,277
Other operating expenses (30,388) (9,369)
Other income 494 108
Gain on sale of partial interest in a joint venture 38 – 8,185
Net loss on sale of property, plant and equipment (42) (4)
Negative goodwill arising on acquisition of a subsidiary 37 – 2,620
Profit before taxation 33 70,375 38,693
Taxation 34 (8,157) (2,048)
Profit for the year 62,218 36,645
Attributable to:
Equity holders of the Company 59,036 32,949
Minority interests 3,182 3,696
62,218 36,645
Earnings per share (cents)

Basic earnings per share 35 11.25 6.32
Diluted earnings per share 35 10.99 6.23

Consolidated Statement of Changes in Equity
Total
attributable
Foreign Employee to equity
currency share holders
Share Capital translation Hedging option Accumulated of the Minority Total
Group capital reserve reserve reserve reserve profits Company interests equity
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
At 1 January 2008 95,820 1,064 (1,815) (4,222) 9,419 139,506 239,772 7,295 247,067
Net fair value loss on derivative
financial instruments – – – (406) – – (406) – (406)
Cash flow hedges
– Foreign currency exchange losses – – – (9,885) – – (9,885) – (9,885)
– Transfer to income statement – – – 1,017 – – 1,017 – 1,017
Foreign currency translation differences – – 11,072 – – – 11,072 484 11,556
Net income/(expense) recognised
directly in equity – – 11,072 (9,274) – – 1,798 484 2,282
Profit for the year – – – – – 59,036 59,036 3,182 62,218
Total recognised income/(expense)
for the year – – 11,072 (9,274) – 59,036 60,834 3,666 64,500
Issue of shares for cash under

Employee Share Option Scheme 3,298 – – – – – 3,298 – 3,298
Cost of share-based payment – – – – 3,552 – 3,552 – 3,552
Transfer to capital reserve – 6,140 – – – (6,140) – – –
Dividends – – – – – (9,909) (9,909) – (9,909)
Dividends paid to minority shareholders – – – – – – – (609) (609)
At 31 December 2008 99,118 7,204 9,257 (13,496) 12,971 182,493 297,547 10,352 307,899

61
62
Consolidated Statement of Changes in Equity (cont’d)

Total
attributable
Foreign Employee to equity
currency share holders
Share Capital translation Hedging option Accumulated of the Minority Total
Group capital reserve reserve reserve reserve profits Company interests equity
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
At 1 January 2007 91,142 987 (4,550) (7,839) 6,288 113,573 199,601 18,465 218,066
Recognised in income statement on
maturity of financial instruments – – – 3,617 – – 3,617 – 3,617
Foreign currency translation differences – – 2,735 – – – 2,735 33 2,768
Net income recognised
directly in equity – – 2,735 3,617 – – 6,352 33 6,385
Profit for the year – – – – – 32,949 32,949 3,696 36,645
Total recognised income for the year – – 2,735 3,617 – 32,949 39,301 3,729 43,030
Issue of shares for cash under
Employee Share Option Scheme 4,678 – – – – – 4,678 – 4,678
Cost of share-based payment – – – – 3,131 – 3,131 – 3,131
Transfer to capital reserve – 77 – – – – 77 – 77
Acquisition of minority interest – – – – – – – (14,899) (14,899)

Dividends – – – – – (7,016) (7,016) – (7,016)
At 31 December 2007 95,820 1,064 (1,815) (4,222) 9,419 139,506 239,772 7,295 247,067

Consolidated Cash Flow Statement

Note 2008 2007

$’000 $’000
Operating activities
Profit before taxation 70,375 38,693
Adjustments for:
Cost of share-based payment 3,552 3,131
Fair value loss on derivative financial instruments 680 3,532
Gain on sale of partial interest in a joint venture – (8,185)
Net loss on sale of property, plant and equipment 42 4
Share of loss/(profit) of associates 1,400 (1,277)
Depreciation, amortisation and impairment 9,718 7,198
Finance expenses 10,222 8,878
Finance Income (4,770) (2,548)
Negative goodwill arising on acquisition of a subsidiary – (2,620)
Impairment of trade and other receivables 3,088 45
Provision for inventory obsolescence and inventory written down 366 657
Goodwill arising from acquisition of interests from minority interests written off – 242
Operating cash flows before working capital changes 94,673 47,750
Changes in working capital:

Inventories (13,543) (10,105)
Gross amounts due for contract work (730) (44,834)
Trade receivables 241 (12,925)
Finance and lease receivables (169,044) 65,261
Lease prepayments (909) –
Other receivables, deposits and prepayments (7,744) (13,572)
Due from related parties (trade) (23,300) (2,153)
Trade payables 159,629 20,165
Other payables and accruals 4,506 4,341
Progress payments from customers (12,646) 22,631
Derivative financial instruments – 111
Cash generated from operations 31,133 76,670
Income taxes paid (1,276) (2,138)
Cash flows from operating activities 29,857 74,532

Consolidated Cash Flow Statement (cont’d)

Note 2008 2007

$’000 $’000
Investing activities
Purchase of property, plant and equipment (18,792) (30,393)
Acquisition of intangible assets (30,006) (278)
Acquisition of a subsidiary, net of cash acquired 37 – (36,012)
Acquisition of associates (5,869) (90,949)
Acquisition of long-term investments – (1,919)
Sale of partial interest in a joint venture, net of cash disposed of 38 – 16,059
Proceeds from sale of property, plant and equipment 791 78
Dividend received from associates 2,451 1,158
Due from related parties (non-trade) (45,199) –
Interest received 4,770 2,047
Cash flows from investing activities (91,854) (140,209)
Financing activities
Proceeds from issuance of new shares under Employee Share Option Scheme 3,298 4,678
Proceeds from borrowings 100,510 168,291
Repayment of borrowings (49,825) (27,532)
Repayment of finance lease liabilities (119) (286)
Interest paid (12,100) (8,878)
Interest received from derivatives – 501
Dividends paid to equity holders of the Company (9,909) (7,016)
Dividends paid to minority interests of subsidiaries (609) –
Cash flows from financing activities 31,246 129,758
Net (decrease)/increase in cash and cash equivalents (30,751) 64,081

Cash and cash equivalents at beginning of year 121,047 55,827
Effect of exchange rate changes 1,184 1,139
Cash and cash equivalents at end of year 19 91,480 121,047

Notes to the Financial Statements

These notes form an integral part of the financial statements.
The financial statements were authorised for issue by the Board of Directors on 10 March 2009.
1 Domicile and activities
Hyflux Ltd (the Company) is incorporated in the Republic of Singapore and has its registered office at 202 Kallang
Bahru, Singapore 339339.
The principal activities of the Company are those relating to investment holding. The Company’s principal activities
relating to the manufacturing of membrane systems were transferred to a subsidiary on 1 January 2008.
The principal activities of its subsidiaries comprise the following:
Water
– Seawater desalination, raw water purification, wastewater cleaning, water recycling, water reclamation and ultra
pure water production for municipal and industrial clients as well as home consumer filtration and purification
products; and
– Design, build and sale of water treatment plants, wastewater treatment plants and water recycling plants
under concession arrangements.
Renewable Resources Management
– Development of membrane applications in resource recovery, waste recycling and energy reclamation,
including applications such as used oil recovery and recycling.
– Development and commercialisation of specialty materials, such as L-lactic acid from natural renewable resources.
– Separation, concentration and purification treatments for manufacturing process streams.
The consolidated financial statements relate to the Company and its subsidiaries (together referred to as the Group)
and the Group’s interests in associates and joint venture.
2 Summary of significant accounting policies
2.1 Basis of preparation
The financial statements have been prepared in accordance with Singapore Financial Reporting Standards (FRS).
The financial statements have been prepared on the historical cost basis except where otherwise described in
the accounting policies below.
The financial statements are presented in Singapore dollars which is the Company’s functional currency.
The functional currency of its principal subsidiaries is Chinese Reminbi. All financial information presented in
Singapore dollars has been rounded to the nearest thousand, unless otherwise stated.
The preparation of financial statements in conformity with FRS requires management to make judgements,
estimates and assumptions that affect the application of accounting policies and the reported amounts of
assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate is revised and in any future periods affected.
Notes to the Financial Statements (cont’d)

2 Summary of significant accounting policies (cont’d)
2.1 Basis of preparation (cont’d)
Information about significant areas of estimation uncertainty and critical judgements in applying accounting
policies that have the most significant effect on the amount recognised in the financial statements are
described in note 44.
There were no changes in accounting policies during the year.
The accounting policies used by the Group have been applied consistently to all periods presented in these
financial statements.
2.2 Consolidation
Business combinations
Business combinations are accounted for under the purchase method. The cost of an acquisition is measured
at the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of
exchange, plus costs directly attributable to the acquisition.
The excess of the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent
liabilities over the cost of acquisition is credited to income statement in the period of the acquisition.
Subsidiaries
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power to govern the
financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control,
potential voting rights presently exercisable are taken into account. The financial statements of subsidiaries are
included in the consolidated financial statements from the date that control commences until the date that
control ceases. The accounting policies of subsidiaries have been changed where necessary to align them with
the policies adopted by the Group.
Joint ventures
Joint ventures are those entities over whose activities the Group has joint control, established by contractual
agreement and requiring unanimous consent for strategic financial and operating decisions. Joint ventures are
accounted for using proportionate consolidation. The financial statements of joint ventures are proportionately
consolidated from the date that joint control commences until the date that joint control ceases. Adjustments
have been made to the financial statements of joint ventures to align their accounting policies with those
adopted by the Group.

2.2 Consolidation (cont’d)
Associates
Associates are those entities in which the Group has significant influence, but not control, over their financial
and operating policies. Significant influence is presumed to exist when the Group holds between 20% and
50% of voting power of another entity. When the Group holds more than 50% of the voting power of another
entity, the entity is considered an associate if control is intended to be temporary, which must be evidenced by
the intention to dispose of it within twelve months from acquisition date and management is actively seeking
a buyer. Associates are accounted for using the equity method. The consolidated financial statements include
the Group’s share of the income, expenses and equity movements of associates after adjustments to align the
accounting policies with those of the Group, from the date that significant influence commences until the
date that significant influence ceases. When the Group’s share of losses exceeds its interest in an associate, the
carrying amount of that interest (including any long-term investments) is reduced to zero and the recognition
of further losses is discontinued except to the extent that the Group has an obligation or has made payments
on behalf of the investee.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income or expenses arising from intra-group
transactions, are eliminated in preparing the consolidated financial statements.
Unrealised gains arising from transactions with joint ventures are eliminated to the extent of the Group’s interest
in the joint ventures. Unrealised losses are eliminated in the same way as unrealised gains except that losses are
recognised immediately when they represent a reduction in the net realisable value of assets or an impairment
loss. Balances with joint ventures are eliminated to the extent of the Group’s interest in the joint ventures.
Unrealised gains arising from transactions with associates are eliminated against the investment to the extent
of the Group’s interest in the associates. Unrealised losses are eliminated in the same way as unrealised gains,
but only to the extent that there is no evidence of impairment.
Accounting for subsidiaries, joint ventures and associates by the Company
Investments in subsidiaries, joint ventures and associates are stated in the Company’s balance sheet at cost less
accumulated impairment losses.
2.3 Foreign currencies
Foreign currency transactions
Transactions in foreign currencies are translated to the respective functional currencies of Group entities
at the exchange rate at the date of the transaction. Monetary assets and liabilities denominated in foreign
currencies at the reporting date are retranslated to the functional currency at the exchange rate at the
reporting date. Non-monetary assets and liabilities denominated in foreign currencies that are measured at
fair value are retranslated to the functional currency at the exchange rate at the date on which the fair value
was determined.
Foreign currency differences arising on retranslation are recognised in the income statement, except for
differences arising on the retranslation of monetary items that in substance form part of the Group’s net
investment in a foreign operation (see below), available-for-sale equity instruments and financial liabilities
designated as hedges of highly probable forecasted transactions (see note 2.7).

2.3 Foreign currencies (cont’d)

Foreign operations
The assets and liabilities of foreign operations are translated to Singapore dollars at exchange rates prevailing
at the reporting date. The income and expenses of foreign operations are translated to Singapore dollars at
exchange rates prevailing at the dates of the transactions. Goodwill and fair value adjustments arising on the
acquisition of a foreign operation on or after 1 January 2005 are treated as assets and liabilities of the foreign
operation and translated at the closing rate. For acquisitions prior to 1 January 2005, the exchange rates at the
date of acquisition were used.
Foreign currency differences are recognised in the foreign currency translation reserve. When a foreign
operation is disposed of, in part or in full, the relevant amount in the foreign exchange translation reserve is
transferred to the income statement.
Net investment in a foreign operation
Exchange differences arising from monetary items that in substance form part of the Company’s net investment
in a foreign operation are recognised in the Company’s income statement. Such exchange differences are
reclassified to equity in the consolidated financial statements. When the foreign operation is disposed of, the
cumulative amount in equity is transferred to the income statement as an adjustment to the profit or loss
arising on disposal.
2.4 Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses.
Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed
assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the
asset to a working condition for its intended use, and the cost of dismantling and removing the items and
restoring the site on which they are located. Purchased software that is integral to the functionality of the
related equipment is capitalised as part of that equipment.
When parts of an item of property, plant and equipment have different useful lives, they are accounted for as
separate items (major components) of property, plant and equipment.
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount
of the item if it is probable that the future economic benefits embodied within the part will flow to the Group
and its cost can be measured reliably. The costs of the day-to-day servicing of property, plant and equipment
are recognised in the income statement as incurred.
Property, plants and equipment under construction are not depreciated. Depreciation on other property, plant
and equipment is recognised in the income statement on a straight-line basis over their estimated useful lives
(or lease term, if shorter) of each part of an item of property, plant and equipment.
The estimated useful lives are as follows:
Plant and machinery – 4 to 10 years
Motor vehicles – 4 to 5 years
Computers – 1 to 5 years
Office equipment – 4 to 5 years
Leasehold properties and improvements – 4 to 5 years or over the lease period
Furniture and fittings – 4 to 5 years
Depreciation methods, useful lives and residual values are reviewed, and adjusted as appropriate, at each
reporting date.

2.5 Intangible assets
Goodwill
Goodwill and negative goodwill arise on the acquisition of subsidiaries, joint ventures and associates.
Acquisitions prior to 1 January 2001
Goodwill represents the excess of the cost of the acquisition over the Group’s interest in the net fair value of the
identifiable assets and liabilities of the acquiree.
Goodwill and negative goodwill on acquisitions were written off against accumulated profits in the year
of acquisition.
Goodwill and negative goodwill that have previously been taken to reserves are not taken to the income
statement when (a) the business is disposed of or (b) the goodwill is impaired.
Acquisitions occurring between 1 January 2001 and 1 January 2005
identifiable assets and liabilities of the acquiree.
Goodwill arising on the acquisition of subsidiaries and joint ventures is presented in intangible assets. Goodwill
arising on the acquisition of associates is presented together with investments in associates.
Goodwill was stated at cost from the date of initial recognition and amortised over its estimated useful life of not
more than 20 years. On 1 January 2005, the Group discontinued amortisation of this goodwill. This remaining
goodwill balance is subject to testing for impairment, as described in note 2.9.
Negative goodwill was derecognised by crediting accumulated profits on 1 January 2005.
Acquisitions on or after 1 January 2005
identifiable assets, liabilities and contingent liabilities of the acquiree.
Goodwill arising on the acquisition of subsidiaries and joint ventures is presented in intangible assets. Goodwill
arising on the acquisition of associates is presented together with investments in associates.
Goodwill is measured at cost less accumulated impairment losses. Goodwill is tested for impairment as
described in note 2.9. Negative goodwill is recognised immediately in the income statement.
Acquisition of minority interest
Goodwill arising on the acquisition of a minority interest in a subsidiary represents the excess of the cost of the
additional investment over the carrying amount of the net assets acquired at the date of exchange.

2.5 Intangible assets (cont’d)
Research and development costs
Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge
and understanding, is recognised in the income statement as an expense when it is incurred.
Development activities involve a plan or design for the production of new or substantially improved products
and processes. Development expenditure is capitalised only if development costs can be measured reliably,
the products or process is technically and commercially feasible, future economic benefits are probable, and
the Group intends to and has sufficient resources to complete development and to use or sell the asset.
The expenditure capitalised includes the cost of materials, direct labour and overhead costs that are directly
attributable to preparing the asset for its intended use. Other development expenditure is recognised in the
income statement as an expense when it is incurred.
Capitalised development expenditure is stated at cost less accumulated amortisation and impairment losses.
Amortisation is charged to the income statement using the straight-line method over the estimated useful lives
of not more than 15 years, from the date on which they are available for use.
Capitalised development expenditure that is not available for use is reviewed for impairment annually or as and
when indicators of impairment are identified as described in note 2.9.
Other intangible assets
Other intangible assets with finite useful lives are measured at cost less accumulated amortisation and
impairment losses. They are amortised in the income statement on a straight-line basis over their estimated
useful lives ranging from 10 to 20 years, from the date on which they are available for use.
Other intangible assets that are not available for use are tested for impairment annually or as and when indicators
of impairment are identified as described in note 2.9.
Subsequent expenditure
Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economic
benefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred.
2.6 Investment properties
Investment properties are properties held either to earn rental income or capital appreciation or both. They do
not include properties for sale in the ordinary course of business, used in the production or supply of goods or
services, or for administrative purposes.
Investment properties are measured at cost less accumulated depreciation and impairment losses. Rental
income from investment properties is accounted for in the manner described in note 2.14.
Depreciation on investment properties is recognised in the income statement on a straight-line basis over the
lease terms.
Depreciation methods, useful lives and residual values are reviewed, and adjusted as appropriate, at each
reporting date.

2.7 Financial instruments
Non-derivative financial instruments
Non-derivative financial instruments comprise investments in equity securities, trade and other receivables,
cash and cash equivalents, financial liabilities, and trade and other payables.
Non-derivative financial instruments are recognised initially at fair value plus, for instruments not at fair
value through profit or loss, any directly attributable transaction costs. Subsequent to initial recognition,
non-derivative financial instruments are measured as described below.
A financial instrument is recognised if the Group becomes a party to the contractual provisions of the instrument.
Financial assets are derecognised if the Group’s contractual rights to the cash flows from the financial assets expire
or if the Group transfers the financial asset to another party without retaining control or transfers substantially all
the risks and rewards of the asset. Regular way purchases and sales of financial assets are accounted for at trade
date, i.e., the date that the Group commits itself to purchase or sell the asset. Financial liabilities are derecognised if
the Group’s obligations specified in the contract expire or are discharged or cancelled.
Cash and cash equivalents comprise cash balances and bank deposits.
Available-for-sale financial assets
The Group’s investments in equity securities are classified as available-for-sale financial assets. Subsequent to
initial recognition, they are measured at fair value and changes therein, other than for impairment losses, are
recognised directly in equity. When an investment is derecognised, the cumulative gain or loss in equity is
transferred to the income statement.
Where an investment in equity security classified as available-for-sale does not have a quoted market price
in an active market and other methods of determining fair value do not result in a reasonable estimate, the
investment is measured at cost less impairment losses.
Others
Other non-derivative financial instruments are measured at amortised cost using the effective interest method,
less any impairment losses.
Derivative financial instruments
Derivative financial instruments are held to hedge its foreign currency and interest rate risk exposures.
Embedded derivatives are separated from the host contract and accounted for separately if the economic
characteristics and risks of the host contract and the embedded derivative are not closely related, a separate
instrument with the same terms as the embedded derivative would meet the definition of a derivative, and the
combined instrument is not measured at fair value through profit or loss.
Derivative financial instruments are recognised initially at fair value; attributable transaction costs are recognised
in the income statement when incurred. Subsequent to initial recognition, derivatives are measured at fair
value, and changes therein recognised immediately in the income statement. However, where derivatives
qualify for hedge accounting, recognition of any resultant gain or loss depends on the nature of the item being
hedged as described below.

2.7 Financial instruments (cont’d)
Hedging
Cash flow hedges
Changes in the fair value of a derivative hedging instrument designated as a cash flow hedge are recognised
directly in the equity to the extent that the hedge is effective. To the extent that the hedge is ineffective,
changes in fair value are recognised in the income statement.
If the hedging instrument no longer meets the criteria for hedge accounting, expires or is sold, terminated or
exercised, hedge accounting is discontinued prospectively. The comulative gain or loss previously recognised
in the equity remains there until the forecast transaction occurs. When the hedged item is a non-financial asset,
the amount recognised in equity is transferred to the carrying amount of the asset when it is recognised. In
other cases, the amount recognised in equity is transferred to the income statement in the same period that
the hedged item affects profit or loss.
Changes in the fair value of a non-derivative financial instrument designated as a cash flow hedge of foreign
currency risk exposures are accounted for in the same manner as a derivative hedging instrument designated
as a cash flow hedge where it qualifies for hedge accounting.
Fair value hedges
Changes in fair value of a derivative hedging instrument designated as a fair value hedge are recognised in the
income statement. The hedged item also is stated at fair value in respect of the risk being hedged; the gain
or loss attributable to the hedged risk is recognised in the income statement and the carrying amount of the
hedged item is adjusted.
Economic hedges
Hedge accounting is not applied to derivative instruments that economically hedge monetary assets and
liabilities dominated in foreign currencies. Changes in the fair value of such derivatives are recognised in the
income statement as part of foreign currency gains and losses.
Impairment of financial assets
A financial asset is assessed at each reporting date to determine whether there is any objective evidence that
it is impaired. A financial asset is considered to be impaired if objective evidence indicates that one or more
events have had a negative effect on the estimated future cash flows of that asset.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference
between its carrying amount and the present value of the estimated future cash flows discounted at the
original effective interest rate. An impairment loss in respect of an available-for-sale financial asset is calculated
by reference to its current fair value.
Individually significant financial assets are tested for impairment on an individual basis. The remaining financial
assets are assessed collectively in groups that share similar credit risk characteristics.
All impairment losses are recognised in the income statement. Any cumulative loss in respect of an available-
for-sale financial asset recognised previously in equity is transferred to the income statement.
Impairment losses in respect of financial assets measured at amortised cost are reversed if the subsequent
increase in fair value can be related objectively to an event occurring after the impairment loss was recognised.

2.7 Financial instruments (cont’d)
Impairment of financial assets (cont’d)
Impairment losses once recognised in the income statement in respect of available-for-sale equity securities are
not reversed through the income statement. Any subsequent increase in fair value of such assets is recognised
directly in equity.
Impairment losses recognised in a previous interim period in respect of available-for-sale equity securities and
financial assets carried at cost are not reversed even if the impairment losses would have been reduced or
avoided had the impairment assessment been made at a subsequent reporting or balance sheet date.
Share capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of ordinary shares and share options are recognised as
a deduction from equity, net of any tax effects.
Estimation of fair values
The following summarises the significant methods and assumptions used in estimating the fair values of
financial instruments of the Group and Company.
Derivatives
The fair value of forward exchange contracts is based on their listed market price, if available. If a listed market
price is not available, fair value is estimated by discounting the difference between the contractual forward
price and the current forward price for the residual period to maturity of the contract using a risk-free interest
rate (based on government bonds).
The fair value of interest rate swaps is based on broker quotes. These quotes are tested for reasonableness
by discounting estimated future cash flows based on the terms and maturity of each contract using market
interest rates for a similar instrument at the measurement date.
Non-derivative financial liabilities
Fair value, which is determined for disclosure purposes, is calculated based on the present value of future
principal and interest cash flows, discounted at the market rate of interest at the reporting date. For finance
leases, the market rate of interest is determined by reference to similar lease agreements.
Other financial assets and liabilities
The carrying amounts of financial assets and liabilities with a maturity of less than one year (inlcuding trade
and other receivables, cash and cash equivalents, and trade and other payables) are assumed to approximate
their fair values because of the short period to maturity. All other financial assets and liabilities are discounted
to determine their fair values.

2.8 Leases
When entities within the Group are lessees of a finance lease
Leased assets in which the Group assumes substantially all the risks and rewards of ownership are classified as
finance leases. Upon initial recognition, property, plant and equipment acquired through finance leases are
capitalised at the lower of its fair value and the present value of the minimum lease payments. Subsequent
to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that
asset. Leased assets are depreciated over the shorter of the lease term and their useful lives. Lease payments
are apportioned between finance expense and reduction of the lease liability. The finance expense is allocated
to each period during the lease term so as to produce a constant periodic rate of interest on the remaining
balance of the liability. Contingent lease payments are accounted for by revising the minimum lease payments
over the remaining term of the lease when the lease adjustment is confirmed.
When entities within the Group are lessees of an operating lease
Where the Group has the use of assets under operating leases, payments made under the leases are recognised
in the income statement on a straight-line basis over the term of the lease. Lease incentives received are
recognised in the income statement as an integral part of the total lease payments made. Contingent rentals
are charged to the income statement in the accounting period in which they are incurred.
When entities within the Group are lessors of a finance lease
Amounts due from lessees under finance leases are recorded in the balance sheet as receivables at the
amounts of the Group’s net investment in the leases, less any impairment losses. Finance lease income is
allocated to accounting periods so as to reflect a constant periodic rate of return on the Group’s net investment
outstanding in respect of the leases.
At inception, an arrangement that contains a lease is accounted for as such based on the terms and conditions
even though the arrangement is not in the legal form of a lease.
When entities within the Group are lessors of an operating lease
Assets subject to operating leases are included in investment property and are stated at cost less accumulated
depreciation and impairment losses. Rental income (net of any incentives given to lessees) is recognised on a
straight-line basis over the lease term.
2.9 Impairment – non-financial assets
The carrying amounts of the Group’s non-financial assets, other than inventories and deferred tax assets, are
reviewed at each reporting date to determine whether there is any indication of impairment. If any such
indication exists, the assets’ recoverable amounts are estimated. For goodwill and intangible assets which
are not yet available for use, the recoverable amount is estimated at each reporting date, and as and when
indicators of impairment are identified.
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its
estimated recoverable amount. A cash-generating unit is the smallest identifiable asset group that generates
cash flows that largely are independent from other assets and groups. Impairment losses are recognised in
the income statement unless it reverses a previous revaluation, credited to equity, in which case it is charged
to equity. Impairment losses recognised in respect of cash-generating units are allocated first to reduce the
carrying amount of any goodwill allocated to the units and then to reduce the carrying amount of the other
assets in the unit (group of units) on a pro rata basis.

2.9 Impairment – non-financial assets (cont’d)
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value
less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value
using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset or cash-generating unit.
An impairment loss in respect of goodwill is not reversed, even if it relates to an impairment loss recognised in
an interim period that would have been reduced or avoided had the impairment assessment been made at a
subsequent reporting or balance sheet date. In respect of other assets, impairment losses recognised in prior
periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists.
An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable
amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed
the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment
loss had been recognised.
2.10 Gross amounts due for contract work
Gross amounts due for contract work represent the gross unbilled amount expected to be collected from
customers for contract work performed to date. It is measured at cost plus profit recognised to date less
progress billings and recognised losses. Cost includes all expenditure related directly to specific projects
and an allocation of fixed and variable overheads incurred in the Group’s contract activities based on normal
operating capacity.
Gross amounts due for contract work are presented as part of assets in the balance sheet. If payments
received from customers exceed the income recognised, the difference is presented as part of liabilities in
the balance sheet.
2.11 Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is calculated using the weighted average
cost formula and comprises all costs of purchase, costs of conversion and other costs incurred in bringing the
inventories to their present location and condition. In the case of manufactured inventories and work-in-
progress, cost includes an appropriate share of production overheads based on normal operating capacity.
Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of
completion and selling expenses.
2.12 Non-current assets held for sale
Non-current assets (or disposal groups comprising assets and liabilities) that are expected to be recovered
primarily through sale rather than through continuing use are classified as held for sale. Immediately before
classification as held for sale, the assets (or components of a disposal group) are remeasured in accordance
with the Group’s accounting policies. Thereafter generally the assets (or disposal groups) are measured at the
lower of their carrying amount and fair value less cost to sell. Any impairment loss on a disposal group is
first allocated to goodwill, and then to remaining assets and liabilities on pro rata basis, except that no loss
is allocated to inventories, financial assets, deferred tax assets and investment properties, which continue to
be measured under different rules in accordance with the Group’s accounting policies. Impairment losses on
initial classification as held for sale and subsequent gains or losses on remeasurement are recognised in the
income statement. Gains are not recognised in excess of any cumulative impairment loss.

2.13 Employee benefits
Defined contribution plans

Obligations for contributions to defined contribution pension plans are recognised as an expense in the income
statement as incurred.
Short-term benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the
related service is provided.
A provision is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing
plans if the Group has a present legal or constructive obligation to pay this amount as a result of past service
provided by the employee and the obligation can be estimated reliably.
Share-based payments
The share option programme allows Group employees to acquire shares of the Company. The fair value of options
granted is recognised as an employee expense with a corresponding increase in equity. The fair value is measured
at grant date and spread over the vesting period during which the employees become unconditionally entitled
to the options. At each balance sheet date, the Company revises its estimates of the number of options that
are expected to become exercisable. It recognises the impact of the revision of original estimates in employee
expense and in a corresponding adjustment to equity over the remaining vesting period.
The proceeds received net of any directly attributable transactions costs are credited to share capital when the
options are exercised.
2.14 Revenue recognition
Construction contracts
As soon as the outcome of a construction contract can be estimated reliably, contract revenue and expenses are
recognised in the income statement in proportion to the stage of completion of the contract. Contract revenue
includes the initial amount agreed in the contract plus any variations in contract work, claims and incentive
payments to the extent that it is probable that they will result in revenue and can be measured reliably.
The stage of completion is assessed by reference to the proportion that contract costs incurred for work performed
to date bear to the estimated total contact costs. When the outcome of a construction contract cannot be
estimated reliably, contract revenue is recognised only to the extent of contract costs incurred that are likely to be
recoverable. An expected loss on a contract is recognised immediately in the income statement.
Operating and maintenance income
Revenue from the provision of operating and maintenance services is recognised when the services are rendered.
Sale of goods
Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of
returns and allowances, trade discounts and volume rebates. Revenue is recognised when the significant risks
and rewards of ownership have been transferred to the buyer, recovery of the consideration is probable, the
associated costs and possible return of goods can be estimated reliably, there is no continuing management
involvement with the goods, and the amount of revenue can be measured reliably.

2.14 Revenue recognition (cont’d)
Finance income
Finance income represents the interest income on the financial receivable arising from a service concession
arrangement, and is recognised in the income statement using the effective interest method.
Finance lease income
Finance lease income is recognised on the accrual basis, taking into account the effective yield of the asset.
Others
Rental income receivable under operating leases is recognised in the income statement on a straight-line basis
over the term of the lease. Lease incentives granted are recognised as an integral part of the total rental income to
be received. Contingent rentals are recognised as income in the accounting period in which they are earned.
Interest income is recognised as it accrues, using the effective interest method.
2.15 Government grants
When there is reasonable assurance that government grants will be received to compensate the Group for the
cost of an asset, they are deducted against the carrying amount of the asset.
2.16 Finance expenses
Finance expenses comprise interest expense on borrowings and are recognised in the income statement using
the effective interest method, except to the extent that they are capitalised as being directly attributable to the
acquisition, construction or production of an asset which necessarily takes a substantial period of time to be
prepared for its intended use or sale.
2.17 Income tax expense
Income tax expense comprises current and deferred tax. Income tax expense is recognised in the income
statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised
in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
Deferred tax is recognised using the balance sheet method, providing for temporary differences between the
carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation
purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of goodwill,
the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects
neither accounting nor taxable profit, and differences relating to investments in subsidiaries, joint ventures and
associates to the extent that they probably will not reverse in the foreseeable future. Deferred tax is measured at
the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws
that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset
if there is a legally enforceable right to offset current tax liabilities and assets and they relate to income taxes levied
by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current
tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.
A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available
against which the temporary differences can be utilised. Deferred tax assets are reviewed at each reporting
date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

2.18 Service concession arrangements

The Group has entered into service concession arrangements with the various governing bodies or agencies
of the government of the People’s Republic of China (the grantors) to supply treated water from water
treatment plants, and operate wastewater treatment plants and water recycling plants. Under the concession
arrangements, the Group will construct and/or operate the plants for concession periods of between 20
to 30 years and transfer the plants to the grantors at the end of the concession periods. Such concession
arrangements fall within the scope of INT FRS 112 and are accounted for as follows:
Financial receivables
The Group recognised a financial receivable arising from a service concession arrangement when it has a
right to receive a fixed and determinable amount of payments during the concession period irrespective of
the usage of the concession infrastructure. The financial receivable is accounted for in accordance with the
accounting policy set out in note 2.7.
When the Group receives a payment during the concession period, it will apportion such payment between
(i) a repayment of the financial receivable (if any), which will be used to reduce the carrying amount of the
financial receivable on its balance sheet, (ii) interest income, which will be recognised as finance income in its
income statement and (iii) revenue from operating and maintaining the infrastructure to be recognised in its
income statement.
Intangible assets
The Group recognises an intangible asset arising from a service concession arrangement when it has a right to
charge for usage of the concession infrastructure but does not have any contractual rights under the concession
agreements to receive a fixed and determinable amount of payments during the concession period. Intangible
assets received as consideration for providing construction services in a service concession arrangement are
measured at fair value upon initial recognition, estimated by reference to the fair value of the construction
services provided. When the Group receives an intangible asset and a financial asset as consideration for
providing construction services in a service concession arrangement, the Group estimates the fair value of
intangible assets as the difference between the fair value of the construction services provided and the fair
value of the financial asset received. Subsequent to initial recognition, the intangible asset is measured at cost
less accumulated amortisation and impairment losses.
The estimated useful life of an intangible asset in a service concession arrangement is the period when it is
available for use to the end of the concession period.
Revenue recognition
Revenue relating to construction services under a service concession arrangement is recognised in accordance
with the Group’s accounting policy on recognising revenue on construction contracts (see note 2.14). Operation
or service revenue is recognised in the period in which the services are provided by the Group. When the Group
provides more than one service in a service concession arrangement, the consideration received is allocated
by reference to the relative fair values of the services delivered.
3 Property, plant and equipment
Leasehold
properties
Plant and Motor Office and Furniture Construction
Group machinery vehicles Computers equipment improvements and fittings -in-progress Total
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
Cost
At 1 January 2007 11,692 2,700 3,697 1,448 9,925 744 15,795 46,001
Additions 3,053 595 2,051 344 13,063 291 15,719 35,116
Assets acquired in business combinations 17,010 39 – – – 49 3,772 20,870
Transfers 3,854 – – – – – (3,854) –
Disposals (17,283) (299) (44) (25) (614) (73) (4,585) (22,923)
Translation differences on consolidation 65 16 8 27 34 2 18 170
At 31 December 2007 18,391 3,051 5,712 1,794 22,408 1,013 26,865 79,234
Additions 2,573 524 1,765 377 1,956 429 11,168 18,792
Transfers 1,278 – – – 2,303 – (3,581) –
Transfer to lease prepayments – – – – (2,747) – – (2,747)
Transfer to financial receivables – – – – – – (16,234) (16,234)
Disposals (1,610) (527) (283) (42) – (14) – (2,476)
Translation differences on consolidation 308 90 229 25 859 7 274 1,792

At 31 December 2008 20,940 3,138 7,423 2,154 24,779 1,435 18,492 78,361
Accumulated depreciation
At 1 January 2007 5,667 1,467 2,350 869 1,989 256 – 12,598
Depreciation charge for the year 1,958 470 813 204 1,256 95 – 4,796
Disposals (141) (174) (14) (25) (409) (32) – (795)
Translation differences on consolidation 30 8 5 8 10 1 – 62
At 31 December 2007 7,514 1,771 3,154 1,056 2,846 320 – 16,661
Depreciation charge for the year 2,730 472 1,260 222 1,506 134 – 6,324
Transfer to lease prepayments – – – – (185) – – (185)
Disposals (930) (481) (186) (35) – (11) – (1,643)
Translation differences on consolidation 83 43 158 15 46 2 – 347
At 31 December 2008 9,397 1,805 4,386 1,258 4,213 445 – 21,504
Carrying amount
At 1 January 2007 6,025 1,233 1,347 579 7,936 488 15,795 33,403
At 31 December 2007 10,877 1,280 2,558 738 19,562 693 26,865 62,573
At 31 December 2008 11,543 1,333 3,037 896 20,566 990 18,492 56,857
79
80

3 Property, plant and equipment (cont’d)
Plant and Office Leasehold Furniture Construction

Company machinery Computers equipment improvements and fittings -in-progress Total
$’000 $’000 $’000 $’000 $’000 $’000 $’000
Cost
At 1 January 2007 4,239 886 96 733 16 993 6,963
Additions 1,321 169 1 11 10 3,609 5,121
Transfers 3,854 – – – – (3,854) –
Disposals – – – – – (660) (660)
At 31 December 2007 9,414 1,055 97 744 26 88 11,424
Transfer to subsidiaries (9,414) (37) (97) (744) (15) (88) (10,395)
At 31 December 2008 – 1,018 – – 11 – 1,029
At 1 January 2007 1,835 777 2 1 1 – 2,616
Depreciation charge for the year 985 177 19 13 2 – 1,196
At 31 December 2007 2,820 954 21 14 3 – 3,812
Depreciation charge for the year – 80 – – 1 – 81
Transfer to subsidiaries (2,820) (16) (21) (14) (1) – (2,872)

At 31 December 2008 – 1,018 – – 3 – 1,021
Carrying amount
At 1 January 2007 2,404 109 94 732 15 993 4,347
At 31 December 2007 6,594 101 76 730 23 88 7,612
At 31 December 2008 – – – – 8 – 8
During the year, borrowing costs incurred amounting to $382,000 (2007: $938,000) have been capitalised in construction-in-progress of the Group at rates
ranging from 3.38% to 6.16% (2007: 5.59% to 6.51%) per annum.
The carrying amount of property, plant and equipment of the Group includes balances totalling $247,000 (2007: $357,000) in respect of property, plant and
equipment held under finance leases.

4 Intangible assets
Intellectual Service
Goodwill on property Development Licensing concession
Group consolidation rights costs fees arrangements Total
$’000 $’000 $’000 $’000 $’000 $’000
Cost
At 1 January 2007 4,288 4,682 22,484 5,748 6,404 43,606
Additions – 49 11,606 746 – 12,401
Acquisition through
business combination – – – – 3,559 3,559
Government grants – – (2,187) – – (2,187)
Disposals – (16) (142) (1,022) (9,963) (11,143)
Translation differences
on consolidation – 77 4 – – 81
At 31 December 2007 4,288 4,792 31,765 5,472 – 46,317
Additions – – 9,404 104 19,980 29,488
Acquisition of minority interest 518 – – – – 518
on consolidation – (77) 68 (9) (654) (672)
At 31 December 2008 4,806 4,715 41,237 5,567 19,326 75,651
Accumulated amortisation
and impairment losses
At 1 January 2007 – 639 2,955 1,030 – 4,624
Amortisation charge for the year – 51 1,557 357 308 2,273
Disposals – – (77) (697) (308) (1,082)
on consolidation – – 3 – – 3
At 31 December 2007 – 690 4,438 690 – 5,818
Amortisation charge for the year – 67 1,319 312 269 1,967
Impairment loss – – 1,298 – – 1,298
on consolidation – 7 47 (2) (7) 45
At 31 December 2008 – 764 7,102 1,000 262 9,128
Carrying amount
At 1 January 2007 4,288 4,043 19,529 4,718 6,404 38,982
At 31 December 2007 4,288 4,102 27,327 4,782 – 40,499
At 31 December 2008 4,806 3,951 34,135 4,567 19,064 66,523

4 Intangible assets (cont’d)
Intellectual
property Development Licensing
Company rights costs fees Total
$’000 $’000 $’000 $’000
Cost
At 1 January 2007 1,762 259 1,479 3,500
Additions 17 8 888 913
At 31 December 2007 1,779 267 2,367 4,413
Additions 2 – – 2
Transfer to subsidiaries (17) (267) (2,230) (2,514)
At 31 December 2008 1,764 – 137 1,901
Accumulated amortisation
At 1 January 2007 32 56 4 92
Amortisation charge for the year 15 26 98 139
At 31 December 2007 47 82 102 231
Amortisation charge for the year 16 9 14 39
Transfer to subsidiaries (2) (91) (102) (195)
At 31 December 2008 61 – 14 75
Carrying amount
At 1 January 2007 1,730 203 1,475 3,408
At 31 December 2007 1,732 185 2,265 4,182
At 31 December 2008 1,703 – 123 1,826
Impairment testing for cash-generating units (CGUs) containing goodwill
For the purpose of impairment testing, goodwill is allocated to the Group’s operating divisions which represent the
lowest level within the Group at which the goodwill is monitored for internal management purposes.
The aggregate carrying amounts of goodwill allocated to each unit identified according to business segment are
as follows:
Industrial Others Total

$’000 $’000 $’000
Singapore 1,525 192 1,717

The Netherlands 3,089 – 3,089
4,614 192 4,806

4 Intangible assets (cont’d)
The recoverable amount of the CGUs were based on their values in use. Values in use were determined by
discounting the future cash flows generated from the continuing use of the units and were based on the following
key assumptions:
• Cash flows were projected based on financial budgets approved by management covering a five-year period.
• The anticipated annual revenue growth included in the cash flow projections was 2% to 5% for the years 2009
to 2013.
• No terminal value was assumed.
• A pre-tax discount rate of 12% (2007: 8%) was applied in determining the recoverable amounts of the CGUs and
reflect specific risks relating to the relevant segments.
The values assigned to the key assumptions represent management’s assessment of future trends in the industries
and are based on both external sources and internal sources (historical data).
5 Investment property
Group
2008 2007
$’000 $’000
Cost
At 1 January and 31 December 3,348 3,348
At 1 January 975 846
Depreciation charge for the year 129 129
At 31 December 1,104 975
Carrying amount
At 1 January 2,373 2,502
At 31 December 2,244 2,373
The fair value of the investment property, estimated by the directors of the Company, as at 31 December 2008 is
approximately $2,794,000 (2007: $3,115,000).
6 Investments in subsidiaries
Company
2008 2007
$’000 $’000
Unquoted equity securities, at cost 109,802 113,106

Impairment losses (3,238) (3,238)
106,564 109,868
Loans to subsidiaries 24,509 24,509
131,073 134,377
The loans to subsidiaries are unsecured and interest-free, and settlement is neither planned nor likely to occur in the
foreseeable future. As these balances are, in substance, part of the Company’s net investments in the subsidiaries,
they are stated at cost less impairment losses, if any.

6 Investments in subsidiaries (cont’d)
Details of major subsidiaries are as follows:
Country of Effective equity held

Name of subsidiary incorporation by the Group
2008 2007
% %
Held by the Company

Eflux Singapore Pte Ltd Singapore 100 100
Hydrochem (S) Pte Ltd Singapore 100 100
Hydrochem Engineering (S) Pte Ltd Singapore 100 100
Hyflux Consumer Products Pte Ltd Singapore 100 100
Hyflux Engineering Pte Ltd Singapore 100 100
Hyflux Filtech (Singapore) Pte Ltd Singapore 71 71
Hyflux Membrane Manufacturing (S) Pte Ltd Singapore 100 100
Hyflux Water Trust Management Pte Ltd Singapore 100 100
SinoSpring Utility Ltd British Virgin Islands 100 100
Held through subsidiaries

Eflux SK Pte Ltd Singapore 51 51
Hydrochem Engineering (Shanghai) Co., Ltd People’s Republic of China 100 100
Hyflux Aquosus (Singapore) Pte Ltd Singapore 100 100
Hyflux CEPAration B.V. The Netherlands 70 51
Hyflux CEPAration N.V. The Netherlands 70 51
Hyflux Filtech Shanghai Co., Ltd People’s Republic of China 71 71
Hyflux Hi-Tech (Product) Yangzhou Co., Ltd People’s Republic of China 100 100
Hyflux Lifestyle Products (S) Pte Ltd Singapore 100 100
Hyflux NewSpring Construction Engineering
(Shanghai) Co., Ltd People’s Republic of China 100 100
Hyflux Newspring (Dezhou) Co., Ltd People’s Republic of China 100 100
Hyflux Newspring (Funing) Co., Ltd People’s Republic of China 100 100
Hyflux NewSpring (GuanYun) WTP Co., Ltd People’s Republic of China – 100
Hyflux Newspring (Guan Yun) WWTP Co., Ltd People’s Republic of China 100 100
Hyflux Newspring (Leping) Co., Ltd People’s Republic of China 100 100
Hyflux Unitech Shanghai Co., Ltd People’s Republic of China 71 71
Tianjin Dagang NewSpring Co., Ltd People’s Republic of China 100 100
KPMG LLP, Singapore is the auditor of all significant Singapore-incorporated subsidiaries.The foreign-incorporated
subsidiary that is considered significant is Hyflux NewSpring Construction Engineering (Shanghai) Co., Ltd (HNS).
HNS is audited by Shanghai HDDY Certified Public Accountants Co., Ltd, People’s Republic of China.

7 Investment in joint venture

Company
2008 2007
$’000 $’000
Unquoted equity securities, at cost 2,375 1,125
Details of the joint venture are as follows:

Name of joint venture incorporation by the Group
2008 2007
% %
Hyflux Marmon Development Pte Ltd Singapore 50 50
The joint venture is not considered significant.
The summarised financial information of the joint venture, which are adjusted for the percentage of ownership held
by the Group, are as follows:
2008 2007
$’000 $’000
Assets and liabilities

Non-current assets 1,387 456
Current assets 318 419
Total assets 1,705 875
Current/Total liabilities (104) (106)
Results
Revenue 97 37
Expenses (501) (399)
Loss before income tax (404) (362)
8 Investments in associates
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Quoted equity securities 58,680 62,230 – –

Unquoted equity securities 36,036 23,553 12,608 12,277
94,716 85,783 12,608 12,277
Fair value of investment in an associate for which

there is published price quotation 33,075 76,545 – –

8 Investments in associates (cont’d)
Investments in associates at 31 December 2008 include goodwill of $2,400,000 (2007: $1,800,000).
Unquoted equity securities of the Group with carrying amount of $7,759,000 (2007: $10,162,000) have been pledged
as collaterals for banking facilities granted to an associate.
Details of major associates are as follows:

Name of associates incorporation by the Group
2008 2007
% %
Held by Company
SingSpring Trust Singapore 30.0 30.0
Held through subsidiaries

Hyflux Water Trust Singapore 31.5 31.5
Lube Oil Re-fining Co., LLC Kingdom of Saudi Arabia 41.5 41.5
New Spring (Huludao) Co., Ltd People’s Republic of China 49.0 49.0
Ningxia Hypow Bio-Technology Co., Ltd People’s Republic of China 25.0 25.0
Sinolac (Singapore) Pte Ltd * Singapore 27.5 19.5
Tlemcen Desalination Investment Corporation France 30.0 20.0
*Accounted for as a long-term investment in the previous year.
KPMG LLP, Singapore is the auditor of all significant Singapore-incorporated associates. The foreign-incorporated
associates are not considered significant.
The summarised financial information of the associates, which are adjusted for the percentage of ownership held
by the Group, are as follows:
2008 2007
$’000 $’000

Total assets 249,336 185,948
Total liabilities 127,405 78,995
Results
Revenue 12,113 10,258
(Loss)/profit after income tax (1,400) 1,277
9 Long-term investments
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Available-for-sale unquoted equity securities, at cost 908 7,917 899 899


10 Financial and lease receivables
Group
2008 2007
$’000 $’000
Non-current
Financial receivables 193,618 9,570
Lease receivables 586 –
194,204 9,570
Current
Financial receivables 2,964 187
Lease receivables 284 –
3,248 187
At 31 December 2008, the Group has receivables under finance leases as follows:
Present
value of
Minimum minimum
lease Unearned lease
payment finance payment
receivables income receivables
$’000 $’000 $’000
Group
Within 1 year 329 (45) 284
After 1 year but within 5 years 739 (153) 586
1,068 (198) 870
Under the terms of the lease arrangements, no contingent rents are recognised and there are no unguaranteed
residual values accruing to the Group.
The weighted average effective interest rate of the lease receivables at 31 December 2008 is 5.5% per annum.
11 Lease prepayments
Lease prepayments relate to payments made for land use rights and are charged to the income statement on a
straight-line basis over the lease term ranging from 20 to 30 years.
12 Trade receivables
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Non-current
Trade receivables 2,872 – – –
Current
Trade receivables 45,026 48,012 16 1,148
Impairment losses (4,009) (1,902) – –
41,017 46,110 16 1,148

12 Trade receivables (cont’d)

Included in current trade receivables of the Group are notes receivables of $2,007,000 (2007: $4,372,000) relating to
bank documents secured from customers for settlement of payment within the next six months.
Concentration of credit risk relating to trade receivables is limited due to the Group’s many varied customers. The
Group’s historical experience in the collection of accounts receivable falls within the recorded impairment losses.
Due to these factors, the Group believes that no additional credit risk beyond amounts provided for collection losses
is inherent in the Group’s trade receivables.
Impairment losses
The change in impairment losses in respect of trade receivables during the year is as follows:
Group
2008 2007
$’000 $’000
At 1 January 1,902 2,009
Impairment loss recognised 2,759 1,022
Impairment loss written off (18) (105)
Impairment loss reversed (706) (977)
Translation differences on consolidation 72 (47)
At 31 December 4,009 1,902
The impairment loss recognised/reversed is included as part of other operating expenses in the income statement.
13 Due from related parties (non-trade)

Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Non-current
Due from:
– subsidiaries – – 19,832 18,833
– associates 36,326 – – –
36,326 – 19,832 18,833
Current
Due from:
– subsidiaries – – 339,908 152,505
– joint venture 11 11 – –
– associates 23,383 4,776 61 2,907
23,394 4,787 339,969 155,412
Outstanding balances with related parties are unsecured. There is no allowance for impairment losses arising from
the outstanding balances.
The non-current non-trade amounts due from subsidiaries are interest-free, have no fixed terms of repayment and
are not expected to be repaid within the next 12 months.
The non-current non-trade amounts due from associates bear interest at rates ranging from 4.23% to 6.84% per
annum at 31 December 2008 and are repayable between 2011 to 2014.
The current non-trade amounts due from related parties are interest-free and are expected to be repaid within the
next 12 months.
14 Deferred tax
Movements in deferred tax assets and liabilities of the Group (prior to offsetting of balances) during the year are as follows:
Disposal of
At Recognised partial interest Translation At Recognised Translation At
1 January in income in a joint differences on 31 December in income differences on 31 December
Group 2007 statement venture consolidation 2007 statement consolidation 2008
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
Deferred tax liabilities

Property, plant and equipment 2,517 679 (1,911) – 1,285 (573) – 712
Intangible assets 1,912 1,241 (1,563) – 1,590 3,958 – 5,548
Total 4,429 1,920 (3,474) – 2,875 3,385 – 6,260
Deferred tax assets

Derivative financial instruments (293) – 293 – – – – –
Tax value of unutilised tax losses
carried forward (505) (695) – (18) (1,218) (1,689) 108 (2,799)
Total (798) (695) 293 (18) (1,218) (1,689) 108 (2,799)
89

14 Deferred tax (cont’d)
Deferred tax liabilities of the Company are attributable to the following:
Company
2008 2007
$’000 $’000
Deferred tax liabilities

Property, plant and equipment 95 95
Intangible assets 64 64
Total 159 159
Deferred tax liabilities and assets 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 amounts determined
after appropriate offsetting are included in the balance sheet as follows:
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Deferred tax liabilities 6,260 2,875 159 159

Deferred tax assets 2,799 1,218 – –
Deferred tax assets have not been recognised in respect of the following temporary differences:
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Unutilised tax losses 13,361 15,196 – 1,562

Unabsorbed capital allowances – 1,569 – –
13,361 16,765 – 1,562
The tax losses and capital allowances are subject to agreement by the tax authorities and compliance with tax
regulations in the respective countries in which the Company and certain subsidiaries operate. The temporary
differences do not expire under current tax legislation. Deferred tax assets have not been recognised in respect
of these items due to the uncertainty of the availability of future taxable profit against which the Group and the
Company can utilise the benefits.
15 Gross amounts due for contract work
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Costs incurred and attributable profits 391,823 169,474 – 14,038

Progress billings (297,836) (76,217) – (4,511)
93,987 93,257 – 9,527

16 Inventories
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Raw materials and consumables 24,046 14,570 – 12,924

Work-in-progress 4,201 3,955 – 2,860
Finished goods 5,580 2,116 – 1,714
33,827 20,641 – 17,498
During the year, write-down of inventories amounting to $366,000 (2007: $657,000) was made by the Group. The
write-down was recognised as part of other operating expenses in the income statement.
17 Other receivables and deposits
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Other receivables 7,987 23,562 1,539 1,017

Impairment losses – (1,658) – –
7,987 21,904 1,539 1,017
Deposits 2,931 6,248 3 3
Advances to suppliers 29,798 5,941 – 2,336
Staff advances 597 680 32 21
41,313 34,773 1,574 3,377
Other receivables are unsecured and interest-free, and are repayable on demand.
Impairment losses
The change in impairment losses in respect of other receivables during the year is as follows:
Group
2008 2007
$’000 $’000
At 1 January 1,658 1,725

Impairment loss written off (1,658) –
Translation differences on consolidation – (67)
At 31 December – 1,658

18 Due from related parties (trade)
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Due from:
– subsidiaries – – 19,605 22,673
– joint venture 20 – – –
– associates 44,954 15,216 – –
44,974 15,216 19,605 22,673
Impairment losses (1,035) – – –
43,939 15,216 19,605 22,673
Outstanding balances with related parties are unsecured.
The change in impairment losses during the year is as follow:
Group
2008 2007
$’000 $’000
At 1 January – –
Impairment loss recognised 1,035 –
At 31 December 1,035 –
The impairment loss recognised is included as part of other operating expenses in the income statement.
19 Cash and fixed deposits
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Cash at bank and in hand 63,201 50,076 3,686 3,175

Fixed deposits with financial institutions 27,539 70,971 14,556 2,899
90,740 121,047 18,242 6,074
Cash and fixed deposits of disposal group 740 –

Cash and cash equivalent in the
consolidated cash flow statement 91,480 121,047
The effective interest rates relating to fixed deposits with financial institutions at the balance sheet date for the
Group and the Company range from 0.01% to 4.10% (2007: 0.30% to 5.20%) per annum. Interest rates reprice within
1 year.

20 Assets classified as held for sale
A wastewater treatment facility in the People’s Republic of China is presented as held for sale following the decision
of the Group’s management on 16 December 2008 to sell this disposal group. The sale is expected to occur on or
after 30 June 2009 but no later than 31 December 2009. The carrying amount of the disposal group classified as held
for sale is $10,833,000 at 31 December 2008.
Details of the disposal group classified as held for sale at 31 December 2008 are as follows:
Group
2008
$’000
Assets
Financial receivables 9,041
Lease prepayments 1,053
Cash and fixed deposits 740
10,834
Liabilities
Other payable and accruals 1
21 Other payables and accruals
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Other payables 12,649 10,071 3,477 2,917

Accrued expenses 9,603 7,676 731 387
22,252 17,747 4,208 3,304
22 Interest-bearing loans and borrowings, and finance lease liabilities
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Non-current
Secured bank loans 1,432 2,670 – –
Unsecured bank loans 206,387 190,596 206,170 190,596
207,819 193,266 206,170 190,596
Finance lease liabilities 73 187 – –
207,892 193,453 206,170 190,596
Current
Secured bank loans 721 – – –
Unsecured bank loans 49,524 5,245 49,524 5,000
50,245 5,245 49,524 5,000
Finance lease liabilities 99 104 – –
50,344 5,349 49,524 5,000

22 Interest-bearing loans and borrowings, and finance lease liabilities (cont’d)
Secured bank loans of the Group are secured by a lien over the inventory and receivables of a subsidiary with carrying
amounts of $172,000 and $199,000 (2007: $252,000 and $1,410,000), respectively and are partially guaranteed by a
director of the subsidiary and a fellow subsidiary.
Unsecured bank loans of the Company totalling $230,596,000 (2007: $190,596,000) are guaranteed by certain
subsidiaries of the Group.
In 2008, the Company established a $300 million unsecured Multicurrency Debt Issuance Programme pursuant to
which the Company may, from time to time, issue notes (Notes) denominated in Singapore dollars and/or any other
currencies. Each series of Notes may be issued at par or at a discount or premium to par; bearing interest at fixed,
floating, variable, hybrid or such other rates, and may have maturities of such tenor, as may be agreed between the
Company and the relevant dealer(s).
As at 31 December 2008, no Notes were issued by the Company.
Finance lease liabilities
At 31 December 2008, the Group has obligations under finance leases that are payable as follows:
2008 2007
Group Principal Interest Payments Principal Interest Payments
$’000 $’000 $’000 $’000 $’000 $’000
Payable within 1 year 99 20 119 104 31 135

Payable after 1 year but
within 5 years 73 8 81 187 13 200
Total 172 28 200 291 44 335
Terms and debt repayment schedule
Terms and conditions of outstanding loans and borrowings are as follows:
Weighted
average
effective 2008 2007
interest rate Year of Carrying Carrying
per annum maturity amount amount
% $’000 $’000
Group
S$ floating rate loans 2.37 2009-2011 72,496 17,245
US$ floating rate loans 4.38 2009-2011 183,198 178,596
Euro floating rate loans 4.70 2009-2017 2,370 2,670
Finance lease liabilities 6.40 2009-2011 172 291
258,236 198,802
Company
S$ floating rate loans 2.37 2009-2011 72,496 17,000
US$ floating rate loans 4.38 2009-2011 183,198 178,596
255,694 195,596

22 Interest-bearing loans and borrowings, and finance lease liabilities (cont’d)
Terms and debt repayment schedule (cont’d)
The following are the expected contractual undiscounted cash outflows of financial liabilities, including interest
payments and excluding the impact of netting agreements:
Carrying
amount Cash flows
After 1 year
Contractual Within 1 but within More than
Group cash flows year 5 years 5 years
$’000 $’000 $’000 $’000 $’000
2008
Variable interest rate loans 258,064 277,853 59,547 217,746 560
Finance lease liabilities 172 200 119 81 –
Trade and other payables * 245,288 245,288 245,288 – –
503,524 523,341 304,954 217,827 560
2007
Variable interest rate loans 198,511 221,528 12,469 208,291 768
Finance lease liabilities 291 335 135 200 –
Trade and other payables * 66,889 66,889 66,889 – –
265,691 288,752 79,493 208,491 768
Carrying
amount Cash flows
After 1 year
Contractual Within 1 but within
Company cash flows year 5 years
$’000 $’000 $’000 $’000
2008
Variable interest rate loans 255,694 275,160 58,705 216,455
Trade and other payables * 118,151 118,151 118,151 –
373,845 393,311 176,856 216,455
2007
Variable interest rate loans 195,596 218,184 12,065 206,119
Trade and other payables * 41,675 41,675 41,675 –
237,271 259,859 53,740 206,119
* Excludes accrued expenses.


23 Due to related parties (trade)
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Due to:
– subsidiaries – – 58 845
– associates 6,458 – – –
6,458 – 58 845
Outstanding balances with related parties are unsecured.
24 Due to related parties (non-trade)
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Due to:
– subsidiaries – – 112,704 36,741
– associates 11,530 1,796 1,886 –
11,530 1,796 114,590 36,741
Outstanding balances with related parties are unsecured, interest-free and are repayable on demand.
25 Share capital
Group and Company

2008 2007
Number of Number of
shares shares
(‘000) (‘000)
Fully paid ordinary shares, with no par value

At 1 January 523,380 518,885
Issue of shares under Employee Share Option Scheme 1,891 4,495
At 31 December 525,271 523,380
Ordinary share capital
During the financial year, the Company issued 1,891,000 ordinary shares pursuant to its Employee Share Option
Scheme (see note 29).
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one
vote per share at meetings of the Company. All shares rank equally with regard to the Company’s residual assets.

25 Share capital (cont’d)
Warrant
By a Warrant Subscription Agreement dated 23 November 2004 supplemented by a Supplemental Warrant

Subscription Agreement dated 25 April 2008 (Agreements) entered into between the Company and Istithmar World
PJSC (formerly known as Istithmar PJSC) (Istithmar), Istithmar is entitled to subscribe for 41,216,863 ordinary shares
in the Company, subject to the terms and conditions of the Agreements and the Warrant Instrument. The exercise
period is from April 2008 to April 2010.
The exercise price is equivalent to the higher of (a) $1.95 and (b) the lower of 70% of the volume-weighted average
price for trades in the Company’s shares transacted on the Singapore Exchange on the market day immediately
preceding the exercise date or in the 30 calendar day period immediately preceding the exercise date.
Capital management
The primary objective of the Group’s capital management is to support the Group’s growth strategy and maximise
shareholder value with the optimal capital structure.
The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To
maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital
to shareholders or issue new shares. There were no changes in the Group’s approach to capital management during
the year.
The Group monitors capital using a gearing ratio, which is net debt divided by total capital. The Group includes
within net debt, interest-bearing loans and borrowings, finance lease liabilities, less cash and cash equivalents. Total
equity of the Group represents capital for the Group.
Group
2008 2007
$’000 $’000
Interest-bearing loans and borrowings 258,064 198,511

Finance lease liabilities 172 291
Less: Cash and cash equivalents (90,740) (121,047)
Net debt 167,496 77,755
Total equity 307,899 247,067
Gearing ratio 54% 31%
Certain subsidiaries of the Group are required by the Foreign Enterprise Law of the People’s Republic of China (PRC) to
contribute to and maintain a non-distributable Statutory Reserve Fund (SRF) whose utilisation is subject to approval
by the relevant PRC authorities (see note 26). This externally imposed capital requirement has been complied with
by the relevant subsidiaries for the financial year ended 31 December 2008. Other than this, the Group and its
subsidiaries are not subject to externally imposed capital requirements.

26 Capital reserve
The capital reserve comprises:
(a) capital gain arising from the payment of the Group’s subscription to the share capital of a subsidiary by a
minority interest; and
(b) Statutory Reserve Fund (SRF)
In accordance with the Foreign Enterprise Law in the PRC, the Group’s subsidiaries in the PRC are required
to make appropriation to a SRF. At least 10% of the statutory after tax profits as determined in accordance
with the applicable PRC accounting standards and regulations must be allocated to the SFR annually until the
cumulative total of the SRF reaches 50% of the subsidiaries’ registered capital. Subject to approval from the
relevant PRC authorities, the SRF may be used to offset any accumulated losses or increase the registered capital
of the subsidiaries. The SRF is not available for dividend distribution to shareholders.
27 Foreign currency translation reserve
The foreign currency translation reserve comprises foreign exchange differences arising from the translation of
the financial statements of foreign operations whose functional currencies are different from the presentation
currency of the consolidated financial statements.
28 Hedging reserve
The hedging reserve comprises:
(a) the effective portion of the cumulative net change in the fair value of cash flow hedging instruments relating
to forecast hedged transactions; and
(b) the Group’s share of the hedging reserve of an associate.
29 Employee share option reserve
The employee share option reserve represents the equity-settled share options granted to employees. This
reserve is made up of the cumulative value of services received from employees recorded over the vesting period
commencing from the grant date of equity-settled share options.
Employee share option scheme
The Hyflux Employee Share Option Scheme (the Scheme) was approved and adopted by the members of the
Company at an Extraordinary General Meeting held on 27 September 2001. The Scheme provides an opportunity for
employees and directors of the Company and its subsidiaries, other than substantial shareholders of the Company,
to participate in the equity of the Company.
On 24 November 2003, the members of the Company approved a modification to the Scheme which allowed Olivia
Lum, Group CEO, President and Managing Director, a substantial shareholder of the Company, to participate in the
Scheme. The maximum entitlement of Olivia Lum is 10% of the total number of shares which may be issued by the
Company under the Scheme.

29 Employee share option reserve (cont’d)
Employee share option scheme (cont’d)
The Scheme is administered by the Remuneration Committee comprising five directors. It shall continue to be in force
at the discretion of the Remuneration Committee for a period of ten years from 27 September 2001. However, the
period may be extended with the approval of the members of the Company at a general meeting of the Company
and of any relevant authorities which may then be required. The contractual life of the option is ten years and there
are no cash settlement alternatives.
The fair value of services received in return for share options granted are measured by reference to the fair value
of share options granted. The estimate of the fair value of the services received is measured based on a Black-
Scholes Standard Option Valuation Model, taking into account the terms and conditions upon which the options
were granted.
Fair Value of share options and assumptions for options granted in 2007 and 2008
Date of grant of options 5/4/2007 23/5/2007 25/9/2007 26/5/2008 31/10/2008
Share price $2.620 $2.660 $2.780 $3.710 $1.560

Exercise price $2.624 $2.608 $2.792 $3.628 $1.472
Expected volatility 34% 34% 37% 37% 47%
Expected option life 90 days 90 days 100 days 100 days 100 days
Expected dividends 0.52% 0.52% 0.49% 0.54% 1.26%
Risk-free interest rate 2.44% 2.18% 2.27% 1.52% 1.61%
The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may
not necessarily be the actual outcome.
There are no market conditions associated with the share option grants. Service conditions and non-market
performance conditions are not taken into account in the measurement of the fair value of the services to be
received at the grant date.
No other features of the option grant were incorporated into the measurement of fair value.
100

29 Employee share option reserve (cont’d)
Employee share option scheme (cont’d)
At the end of the financial year, details of options granted under the Scheme on the unissued ordinary shares of the Company are as follows:
Option No of holders
Date of grant Balance as at Options lapsed/ Options Balance as at as at Exercise
of options 01/01/2008 granted forfeited exercised 31/12/2008 31/12/2008 price Exercise period
$
15/10/2001 488,562 – (938) (163,000) 324,624 54 0.2688 15/10/2002 – 27/09/2011

11/01/2002 750 – – – 750 1 0.4123 11/01/2003 – 27/09/2011
28/03/2002 26,906 – – – 26,906 2 0.5436 28/03/2003 – 27/09/2011
08/04/2002 8,750 – – – 8,750 1 0.5401 08/04/2003 – 27/09/2011
08/07/2002 750 – – – 750 1 0.5664 08/07/2003 – 27/09/2011
01/08/2002 1,125 – – – 1,125 1 0.5888 01/08/2003 – 27/09/2011
16/09/2002 875 – (875) – – – 0.4869 16/09/2003 – 27/09/2011
07/01/2003 193,500 – – (168,000) 25,500 4 0.5995 07/01/2004 – 27/09/2011
07/04/2003 149,750 – – (37,000) 112,750 3 0.7253 07/04/2004 – 27/09/2011
16/10/2003 731,500 – – (180,000) 551,500 9 1.0581 16/10/2004 – 27/09/2011

08/12/2003 1,050,000 – – – 1,050,000 2 1.0197 08/12/2004 – 27/09/2011
29/12/2003 445,500 – (4,500) (100,000) 341,000 14 1.0627 29/12/2004 – 27/09/2011
14/05/2004 240,000 – – (120,000) 120,000 1 0.9600 14/05/2005 – 27/09/2011
07/02/2005 2,585,000 – (116,000) (282,000) 2,187,000 37 1.8600 07/02/2006 – 27/09/2011
03/05/2005 180,000 – (180,000) – – – 2.3227 03/05/2006 – 27/09/2011
09/05/2005 4,500,000 – – – 4,500,000 1 2.3067 09/05/2006 – 27/09/2011
01/06/2005 45,000 – (18,000) (9,000) 18,000 1 2.5493 01/06/2006 – 27/09/2011
08/06/2005 45,000 – – (18,000) 27,000 1 2.6507 08/06/2006 – 27/09/2011
28/03/2006 1,848,000 – (220,000) (396,000) 1,232,000 13 2.6620 28/03/2007 – 27/09/2011
18/10/2006 1,600,000 – (400,000) (140,000) 1,060,000 3 2.3620 18/10/2007 – 27/09/2011
07/12/2006 3,056,000 – (284,000) (238,000) 2,534,000 57 2.3720 07/12/2007 – 27/09/2011
05/04/2007 730,000 – (300,000) (20,000) 410,000 4 2.6240 05/04/2008 – 27/09/2011
23/05/2007 980,000 – (80,000) (20,000) 880,000 4 2.6080 23/05/2008 – 27/09/2011
25/09/2007 3,430,000 – (490,000) – 2,940,000 35 2.7920 25/09/2008 – 27/09/2011
26/05/2008 – 3,610,000 (210,000) – 3,400,000 62 3.6280 26/05/2009 – 07/09/2011
31/10/2008 – 6,995,000 – – 6,995,000 113 1.4720 31/10/2009 – 27/09/2011
22,336,968 10,605,000 (2,304,313) (1,891,000) 28,746,655 424
The weighted average share price at the date of exercise of the options in 2008 was $3.157 (2007: $2.593) per share.

30 Revenue
Group
2008 2007
$’000 $’000
Revenue from construction contracts 544,972 181,906

Operating and maintenance income 8,231 6,562
Sale of goods 520 1,264
Finance income from service concession arrangements – 1,387
Finance lease income 415 1,630
Licence fee 86 37
554,224 192,786
31 Finance income
Group
2008 2007
$’000 $’000
Interest income from:

– fixed deposits with financial institutions 780 1,425
– associates 3,990 1,123
4,770 2,548
32 Finance expenses
Group
2008 2007
$’000 $’000
Interest expense:
– bank loans 10,586 8,092
– finance lease liabilities 18 27
– associates – 1,697
10,604 9,816
Finance expense capitalised in property, plant and equipment (382) (938)
10,222 8,878

33 Profit before Taxation
The following items have been included in arriving at profit before taxation:
Group
2008 2007
$’000 $’000
Net foreign currency exchange gain (10,119) (8,805)

Rental income from investment property (336) (228)
Goodwill arising from acquisition of minority interest written off – 242
Non-audit fees paid/payable to
– auditors of the Company – 156
– other auditors – –
Operating expenses arising from rental of investment property 79 59
Operating lease expenses 3,421 2,689
Professional fees paid to firms in which a director is member 100 69
Contribution to defined contribution plans, included in personnel expenses 3,558 2,419
Cost of share-based payments, included in personnel expenses 3,552 3,131
The Group engages subcontractors in its normal course of business and subcontractors’ costs have been included
in raw materials and consumables.
34 Taxation
Group
2008 2007
$’000 $’000
Current tax expense

Current year 7,646 1,065
Overprovided in prior years (1,185) (242)
6,461 823
Deferred tax expense
Origination and reversal of temporary differences 1,279 1,587
Reduction in tax rate – (362)
Underprovided in prior years 417 –
1,696 1,225
Income tax expense 8,157 2,048


34 Taxation (cont’d)
Reconciliation of effective tax rate
Group
2008 2007
$’000 $’000
Tax calculated using Singapore tax rate of 18% (2007: 18%) 12,668 6,965
Effect of reduction in tax rate – (362)
Effect of different tax rates in other countries 893 2,205
Income not subject to tax (5,103) (6,222)
Expenses not deductible for tax purposes 11,016 2,560
Effect of partial tax exemption and tax reliefs (9,936) (5,874)
Deferred tax assets not recognised – 3,018
Recognition of previously unrecognised deferred tax assets (613) –
Overprovided in prior years (768) (242)
8,157 2,048
A subsidiary was granted Pioneer Status in respect of the production and sale of membrane systems. Accordingly,
subject to the terms and conditions of the Pioneer Status, the subsidiary’s profits from sale of membrane systems are
exempted from income tax during the qualifying period.
In accordance with the “Income Tax Law of the People’s Republic of China for Enterprises with Foreign Investment
and Foreign Enterprises”, certain subsidiaries are entitled to full exemption from Enterprise Income Tax (EIT) for
the first two years and a 50% reduction in EIT for the next three years, commencing from the profitable year after
offsetting all tax losses carried forward from the previous five years. In addition, one of the subsidiaries was also
granted Hi-Technology Status which is subjected to a tax rate of 15%.
Subsidiaries incorporated in the British Virgin Islands (BVI) are exempted from all income taxes in BVI in accordance
with local tax laws.
35 Earnings per share
Group
2008 2007
$’000 $’000
Basic earnings per share is based on:

Net profit attributable to ordinary shareholders 59,036 32,949
Group
2008 2007
Number of Number of
shares shares
(‘000) (‘000)
Issued ordinary shares at beginning of the year 523,380 518,885

Effects of share options exercised 1,372 2,371
Weighted average number of ordinary shares in issue during the year 524,752 521,256

35 Earnings per share (cont’d)
Group
2008 2007
$’000 $’000
Diluted earnings per share is based on:

Net profit attributable to ordinary shareholders 59,036 32,949
For the purpose of calculating the diluted earnings per ordinary share, the weighted average number of ordinary
shares in issue is adjusted to take into account the dilutive effect arising from the dilutive share options and warrants,
with the potential ordinary shares weighted for the period outstanding.
The effects of the exercise of share options and warrants on the weighted average number of ordinary shares in
issue are as follows:
Group
2008 2007
Number of Number of
shares shares
(‘000) (‘000)
Weighted average number of:

– Ordinary shares used in the calculation of basic earnings per share 524,752 521,256
– Potential ordinary shares issuable under share options 3,464 7,696
– Potential ordinary shares issuable under warrants 9,189 –
Weighted average number of ordinary issued and potential shares
assuming full conversion 537,405 528,952
36 Segment reporting
Segment information is presented in respect of the Group’s business and geographical segments. The primary
format, business segments, is based on the Group’s management and internal reporting structure.
Inter-segment pricing is determined on mutually agreed terms.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can
be allocated on a reasonable basis. Unallocated items comprise mainly corporate assets, loans and expenses, and
income tax assets and liabilities.
Segment capital expenditure is the total cost incurred during the period to acquire property, plant and equipment,
and intangible assets other than goodwill.

36 Segment reporting (cont’d)
Business segments
The Group comprises the following main business segments:
The municipal segment is a supplier of comprehensive range of innovative water and fluid treatment solutions to
municipalities and governments, including commissioning, operation and maintenance of a wide range of water
treatment and liquid separation plants on a turnkey or Design-Build-Own-Operate-Transfer arrangements.
The industrial segment is in the business of liquid separation applications for the manufacturing sector such as the
pharmaceutical, biotechnology, food processing and petrochemical oil-related industries.
Geographical segments
The Group operates in two principle geographical areas, People’s Republic of China and Middle East and North Africa.
In preparing information on the basis of geographical segments, segment revenue is based on the geographical
location of customers. Segment assets are based on the geographical location of the assets.
106

Business segments
Municipal Industrial Others Total

$’000 $’000 $’000 $’000
2008 2007 2008 2007 2008 2007 2008 2007
Total external revenue 476,758 88,971 76,383 102,347 1,083 1,468 554,224 192,786
Segment results 75,308 27,304 770 10,253 1,377 (1,188) 77,455 36,369
Gain on sale of partial interest in a joint venture – 8,185

Negative goodwill arising from acquisition of a subsidiary – 2,620
Fair value of derivative financial instruments (680) (3,532)
Other unallocated income 494 108
Unallocated expenses (42) (4)
Results from operating activities 77,227 43,746
Finance income 4,770 2,548
Finance expenses (10,222) (8,878)
Share of (loss)/profit of associates, net of tax 180 2,082 (1,580) (805) – – (1,400) 1,277
Taxation (8,157) (2,048)
Profit for the year 62,218 36,645

Segment assets 561,868 267,824 165,785 112,588 51,569 13,097 779,222 393,509
Unallocated assets 67,333 155,991
Total assets 846,555 549,500
Segment liabilities 219,936 69,036 37,380 33,094 5,117 1,031 262,433 103,161
Unallocated liabilities 276,223 199,272
Total liabilities 538,656 302,433
Other segment information

Capital expenditure 6,883 12,636 11,904 21,050 5 1,430 18,792 35,116
Depreciation, amortisation and impairment 6,111 4,347 1,502 995 2,105 1,856 9,718 7,198

Geographical segments
Middle East People’s
and North Republic Singapore
Africa of China and others Total
$’000 $’000 $’000 $’000
2008
Revenue from external customers 223,011 299,965 31,248 554,224
Segment assets 92,936 499,493 186,793* 779,222
Capital expenditure 227 11,185 7,380* 18,792
2007
Revenue from external customers 8,230 156,933 27,623 192,786
Segment assets 6,877 194,665 191,967* 393,509
Capital expenditure – 14,501 20,615* 35,116
* Segment assets and capital expenditure relating to Singapore amounted to $173,289,000 (2007: $189,000,000) and $7,380,000
(2007: $19,582,000), respectively.

37 Acquisitions of subsidiary and Minority Interest

In June 2007, the Group acquired 100% interest in Langfang Hyflux Newspring Co., Ltd (formerly known as the
Langfang Wastewater Treatment Plant Co., Ltd), a company incorporated in the People’s Republic of China which is in
the business of water recycling and machinery, telecommunications and automotive component manufacturing. The
company’s contribution to the Group’s consolidated net profit for the year ended 31 December 2007 was insignificant.
The Group’s revenue and net profit for the year ended 31 December 2007 would not be significantly different from
those recognised in the consolidated income statement had the acquisition occured on 1 January 2007.
In December 2007, a subsidiary which is an investment holding company became a wholly owned subsidiary of the
Company after the Company acquired the 20% interests held by its minority shareholder. The Group recognised a
goodwill arising from acquisition of minority interest of $242,000.
The effects of the acquisition of subsidiaries/business are set out below:
2008 2007
$’000 $’000
Cash and cash equivalents – 4,594

Current assets – 36,231
Non-current assets – 24,228
Current liabilities – (9,516)
Non-current liabilities – (12,553)
Net identifiable assets and liabilities – 42,984
Positive goodwill on acquisition – 242
Negative goodwill on acquisition – (2,620)
Purchase consideration paid, satisfied in cash – 40,606
Cash acquired – (4,594)
Net cash outflow – 36,012
There was no acquisition of subsidiary in the current financial year.
38 Sale of partial interest in a joint venture
In February 2007, the Company divested 20% of its interest in a Singapore-incorporated joint venture which is in the
business of operation of seawater desalination plant and sale of treated water. The investment was reclassified from
a joint venture to an associate subsequent to the sale.
The effects of the disposal of the joint venture are as follow:
2008 2007
$’000 $’000
Current assets – 4,248

Non-current assets – 39,667
Current liabilities – (2,827)
Non-current liabilities – (31,699)
Gain on disposal – 8,185
Total cash consideration * – 17,574
Cash and cash equivalents disposed – (1,515)
Net cash inflow – 16,059
* Net of professional fees incurred of $143,000

39 Financial risk management
Overview
Effective risk management is a fundamental aspect of the Group’s business operations. The management continually
monitors the Group’s risk management process to ensure that an appropriate balance between risk and control is
achieved. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and
the Group’s activities.
The Risk Management Committee oversees how management monitors compliance with the Group’s risk
management policies and procedures and reviews the adequacy of the risk management framework in relation to
the risks faced by the Group.
Credit risk
Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its
obligations. The Group’s and the Company’s exposure to credit risk arises primarily from trade and other receivables,
financial and lease receivables and amounts due from related parties.
The Group has a credit policy in place which establishes credit limits for all customers and monitors their balances
on an ongoing basis.
The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade
and other receivables, financial and lease receivables and amounts due from related parties. The main components
of this allowance are a specific loss component that relates to individually significant exposures, and a collective
loss component established for groups of similar assets in respect of losses that have been incurred but not yet
identified. The collective loss allowance is determined based on historical data of payment statistics for similar
financial assets.
The allowance account in respect of trade and other receivables is used to record impairment losses unless the
Group is satisfied that no recovery of the amount owing is possible. At that point, the financial asset is considered
irrecoverable and the amount charged to the allowance account is written off against the carrying amount of the
impaired financial asset.
To minimise the Group’s counter-party risk, cash and fixed deposits are placed with banks and financial institutions
which are regulated and of good credit ratings.
The maximum exposure to credit risk for trade and other receivables, financial and lease receivables and amounts
due from related parties at 31 December 2008 (by type of customer) is:
Group Company
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Municipal 293,504 54,265 – –

Industrial 51,496 21,605 – –
Others 7,987 21,904 380,961 199,083
352,987 97,774 380,961 199,083

39 Financial risk management (cont’d)
Impairment losses
The ageing of trade and other receivables, financial and lease receivables and amounts due from related parties at
31 December 2008:
2008 2007
Impairment Impairment
Gross losses Gross losses
$’000 $’000 $’000 $’000
Group
Not past due 329,173 – 73,349 –
Past due 0 to 60 days 18,173 6 5,062 –
Past due 61 to 120 days 2,765 67 7,192 –
More than 120 days 7,920 4,971 15,731 3,560
358,031 5,044 101,334 3,560
Company
Not past due 380,961 – 199,083 –
Based on historical default rates, the Group believes that no impairment allowance is necessary in respect of the
Group’s loans and receivables not past due at 31 December 2008 as these loans and receivables are mainly due from
governing bodies or agencies of the government of the People’s Republic of China, or customers that have a good
record with the Group. Management believes that no impairment allowance is necessary on the Company’s loans
and receivables as at 31 December 2008.
Liquidity risk
The Group monitors its liquidity risk and maintains a level of cash and cash equivalents deemed adequate by
management to finance the Group’s operations and to mitigate the effects of fluctuations in cash flows. For long-term
projects which require long-term funding, the Group may arrange project financing or other long-term financing
programme as appropriate.
Market risk
Market risk is the risk that changes in market prices, such as interest rates, foreign exchange rates and equity prices
will affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk
management is to manage and control market risk exposures within acceptable parameters, while optimising the
return on risk.
Interest rate risk
The Group’s exposure to changes in interest rates relates primarily to its interest-earning financial assets and
interest-bearing financial liabilities.
Where applicable on a need be basis, the group uses interest rate swaps to hedge its interest rate exposure.

Sensitivity analysis
A change of 75 basis point (bp) in interest rates at the reporting date would increase/(decrease) equity and profit
or loss before tax by the amounts shown below. This analysis assumes that all other variables, in particular foreign
currency rates, remain constant.
Profit or loss before tax Equity

75 bp 75 bp 75 bp 75 bp
increase decrease increase decrease
$’000 $’000 $’000 $’000
Group
31 December 2008
Variable rate instruments (1,935) 1,935 – –
31 December 2007
Company
31 December 2008
31 December 2007
Foreign currency risk
The Group is exposed to foreign currency risk on sales, purchases and borrowings that are denominated in
currencies other than the respective functional currencies of Group entities. The currency giving rise to this risk is
primarily US dollars.
The Group monitors its exposure in respect of trade receivables, trade payables and borrowings denominated in
foreign currencies, as well as forecast sales and purchases over the next 12 months. When necessary, the Group will
use forward exchange contracts to hedge its foreign currency risk.
In respect of other monetary assets and liabilities held in currencies other than the US dollars, the Group ensures that
the net exposure is kept to an acceptable level by buying or selling foreign currencies at spot rates, where necessary,
to address short term imbalances.
The Group and the Company also hold cash and short-term deposits denominated in foreign currencies for working
capital purposes.

Foreign currency risk (cont’d)
The Group’s and Company’s significant exposures to foreign currency are as follows:
31 December 2008 31 December 2007

US dollars US dollars
$’000 $’000
Group
Trade and other receivables 72,527 20,121
Cash and fixed deposits 16,138 20,325
Interest-bearing loans and borrowings (183,198) (178,596)
Trade and other payables (24,012) (2,532)
(118,545) (140,682)
Company
Trade and other receivables 204,457 119,480
Cash and fixed deposits 3,181 2,331
Interest-bearing loans and borrowings (183,198) (178,596)
Trade and other payables (50,678) (10,942)
(26,238) (67,727)
Sensitivity analysis
A 10% strengthening of Singapore dollars against the following currencies at the reporting date would increase/
(decrease) equity and profit or loss before tax by the amounts shown below. This analysis assumes that all other
variables, in particular interest rates, remain constant.
Group Company
Profit Profit
or loss or loss
Equity before tax Equity before tax
$’000 $’000 $’000 $’000
31 December 2008
US dollars 17,743* (5,889) – 2,624
31 December 2007
US dollars – 14,068 – 6,773
A 10% weakening of Singapore dollars against the above currencies would have had the equal but opposite effect
on the above currencies to the amounts shown above, on the basis that all other variables remain constant.
* This amount would impact the profit or loss before tax over a three year period upon realisation of hedging reserve.

Sensitivity analysis (cont’d)

The aggregate net fair values of recognised financial assets and liabilities which are not carried at fair value in the
balance sheet at 31 December are represented in the following table:
2008 2007
Carrying Fair Carrying Fair
Group amount value amount value
$’000 $’000 $’000 $’000
Financial assets
Due from associates (non-trade) 36,326 37,356 – –
Unrecognised gain 1,030 –
It is not practicable to reliably estimate the following:
(i) The fair value of available-for-sale unquoted investments due to the lack of quoted market prices in an
active market, significant range of reasonable fair value estimates, and the inability to reasonably assess the
probabilities of the various estimates; and
(ii) The fair value of non-current non-trade amounts due from subsidiaries as the timing of the future cash flows
arising from these balances cannot be determined reliably.
40 Commitments
(i) The Group has various operating lease agreements for office equipment, offices and rental of land. Most leases
contain renewable options and some of leases contain escalation clauses. The lease terms typically do not
contain restrictions on the Group’s activities concerning dividends, additional debt or further leasing.
At 31 December 2008, the Group has commitments for future minimum lease payments under non-cancellable
leases as follows:
Group
2008 2007
$’000 $’000
Within 1 year 3,352 2,370
After 1 year but within 5 years 12,882 8,616
After 5 years 35,002 19,030
51,236 30,016
(ii) At 31 December 2008, the Group has outstanding commitments in respect of uncalled capital of approximately
US$128,120,000 (2007: US$70,000,000) in subsidiaries, joint venture and associates.
(iii) At 31 December 2008, the Group has outstanding capital commitments of $7,630,000 (2007: $Nil).
(iv) The Group leases out its investment property. Non-cancellable operating lease rentals are receivable as follows:
Group
2008 2007
$’000 $’000
Within 1 year 336 336

After 1 year but within 5 years – 336
336 672

41 Dividends
Group and Company
2008 2007
$’000 $’000
Ordinary dividends paid:

Final tax-exempt (one-tier) dividend in respect of the previous financial year
of 1.89 cents (2007: 1.35 cents) per share 9,909 7,016
Subsequent to the balance sheet date, the directors of the Company proposed a final tax-exempt (one-tier) dividend
of 3.43 cents per share totaling of $18,017,000 in respect of the financial year ended 31 December 2008 for approval
by the shareholders at the forthcoming Annual General Meeting. The dividend has not been provided for in these
financial statements.
42 Contingent liabilities
The Company has given formal undertakings to provide financial support to certain subsidiaries with deficit
shareholders’ equity for at least the next twelve months from the balance sheet date.
43 Related parties
Key management personnel compensation
Key management personnel of the Group are those persons having the authority and responsibility for planning,
directing and controlling the activities of the Group.
Key management personnel compensation comprises:
Group
2008 2007
$’000 $’000
Directors’ fees 574 457
Short-term employee benefits 2,519 2,286
Share-based payments 800 1,600
3,893 4,343
Comprise amounts paid/payable to:

– Directors of the company 1,443 2,057
– Other key management personnel 2,450 2,286
3,893 4,343
The directors of the company also participate in the Hyflux Employee Share Option Scheme. Details of options
granted to the directors under the Scheme are described in note 29.

43 Related parties (cont’d)
Other related party transactions
Other than as disclosed elsewhere in the financial statements, transactions carried out in the normal course of
business on terms agreed with related parties are as follows:
Group
2008 2007
$’000 $’000
Joint venture
Management fee 88 –
Rental income 36 24
Associates
Revenue from construction contracts 70,823 70,725
Revenue from maintenance contracts 6,778 904
Management fees income 1,106 1,000
Rental income – 334
44 Accounting estimates and judgementS
Estimates and judgements are continually evaluated and are based on historical experience and other factors,
including expectations of future events that are believed to be reasonable under the circumstances.
The Group believes the following critical accounting policies involve significant judgements and estimates used in
the preparation of the financial statements.
Impairment of non-financial assets
The Group assesses whether there are any indicators of impairment for all non-financial assets at each reporting
date. Goodwill and other intangible assets that are not available for use are tested for impairment annually or as and
when such indicators exist. Other non-financial assets are tested for impairment when there are indicators that the
carrying amounts may not be recoverable.
When value in use calculations are undertaken, management must estimate the expected future cash flows from
the asset or cash cash-generating unit and choose a suitable discount rate in order to calculate the present value
of those cash flows. Further details of the key assumptions applied in the impairment assessment of goodwill are
given in note 4.

44 Accounting estimates and judgementS (cont’d)
Impairment of loans and receivables
The Group evaluates whether there is any objective evidence that loans and receivables are impaired and determines
the amount of impairment loss as a result of the inability of the debtors to make required payments. The Group
considers factors such as the ageing of the loans and receivables, credit-worthiness of the debtors, the probability
of insolvency or significant financial difficulties of the debtor, default or significant delay in payments, and historical
write-off experience. If the financial conditions of the debtors were to deteriorate, actual write-offs would be higher
than estimated.
Development costs
Development costs are capitalised in accordance with the accounting policy in note 2.5. Initial capitalisation of
costs is based on management’s judgement that technological and economical feasibility is confirmed, usually
when a product development project has reached a defined milestone according to an established project
management model.
Capitalised development costs are amortised on a straight-line basis over the estimated useful lives. Significant
judgement is required in estimating the useful lives, which could be affected by factors such as technological
developments.
Construction contracts
The Group recognises contract revenue by reference to the stage of completion of the contract activity at the balance
sheet date, when the outcome of a construction contract can be estimated realiably. The stage of completion
is measured by reference to the proportion that contract costs incurred for work performed to date bear to the
estimated total contract costs. Significant judgement is required to estimate the total contract costs
and the recoverable variation works that will affect the stage of completion.
Service concession arrangements
Revenue for construction services provided under the concession arrangements and the corresponding financial
receivables and/or intangible assets arising are recognised based on the percentage of completion method during
the construction phase.
The percentage of completion method during the construction phase is measured by reference to the proportion
that construction costs incurred to date bear to the estimated total construction costs. Significant judgement is
required in determining the stage of completion, the extent of the construction costs incurred and the estimated
total construction costs.
Significant judgement is also exercised in determining the fair values of the financial receivables and/or intangible
assets. Discount rates, estimates of future cash flows and other factors are used in the valuation process. The
assumptions used and estimates may result in different fair value estimates.

45 New accounting standards and interpretations not yet adopted
The Group has not applied the following accounting standards (including their consequential amendments) and
interpretations that have been issued as of the balance sheet date but are not yet effective:
• FRS 1 (revised 2008) Presentation of Financial Statements
• FRS 23 (revised 2007) Borrowing Costs
• Amendments to FRS 32 Financial Instruments: Presentation and FRS 1 Presentation of Financial Statements –
Puttable Financial Instruments and Obligations Arising on Liquidation
• Amendments to FRS 101 First-time Adoption of Financial Reporting Standards and FRS 27 Consolidated and
Separate Financial Statements – Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate
• Amendments to FRS 102 Share-based Payment – Vesting Conditions and Cancellations
• FRS 108 Operating Segments
• Improvements to FRSs 2008
• INT FRS 113 Customer Loyalty Programmes
• INT FRS 116 Hedges of a Net Investment in a Foreign Operation
FRS 1 (revised 2008) will become effective for the Group’s financial statements for the year ending 31 December
2009. The revised standard requires an entity to present, in a statement of changes in equity, all owner changes in
equity. All non-owner changes in equity (i.e. comprehensive income) are required to be presented in one statement
of comprehensive income or in two statements (a separate income statement and a statement of comprehensive
income). Components of comprehensive income are not permitted to be presented in the statement of changes in
equity. In addition, a statement of financial position is required at the beginning of the earliest comparative period
following a change in accounting policy, the correction of an error or the reclassification of items in the financial
statements. FRS 1 (revised 2008) does not have any impact on the Group’s financial position or results.
FRS 23 (revised 2007) will become effective for financial statements for the year ending 31 December 2009. FRS 23
(revised 2007) removes the option to expense borrowing costs and requires an entity to capitalise borrowing costs
directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset.
The Group’s current policy to capitalise borrowing costs is consistent with the requirement in the revised FRS 23.
The amendments to FRS 32 and FRS 1 on puttable financial instruments will become effective for the Group’s financial
statements for the year ending 31 December 2009. The amendments allow certain instruments that would normally
be classified as liabilities to be classified as equity if and only if they meet certain conditions. The Group does not
issue such puttable financial instruments and thus the application of these amendments is not expected to have any
significant impact on the Group’s financial statements.

45 New accounting standards and interpretations not yet adopted (cont’d)
The amendments to FRS 101 and FRS 27 on the cost of an investment in a subsidiary, jointly controlled entity or
associate will become effective for the Company’s financial statements for the year ending 31 December 2009. The
amendments remove the definition of “cost method” currently set out in FRS 27, and instead require an entity to
recognise all dividend from a subsidiary, jointly controlled entity or associate as income in its separate financial
statements when its right to receive the dividend is established. The application of these amendments is not expected
to have any significant impact on the Company’s financial statements.
The amendments to FRS 102 on vesting conditions and cancellations will become effective for the Group’s financial
statements for the year ending 31 December 2009. The amendments clarify the definition of vesting conditions
and provide the accounting treatment for non-vesting conditions and cancellations. The application of these
amendments is not expected to have any significant impact on the Group’s financial statements.
FRS 108 will become effective for the Group’s financial statements for the year ending 31 December 2009.
FRS 108, which replaces FRS 14 Segment Reporting, requires identification and reporting of operating segments
based on internal reports that are regularly reviewed by the Group’s chief operating decision maker in order to
allocate resources to the segment and to assess its performance. The Group does not expect the new operating
segments to be significantly different from the business segments currently disclosed but expects more information
to be disclosed under FRS 108.
Improvements to FRSs 2008 will become effective for the Group’s financial statements for the year ending 31 December
2009, except for the amendment to FRS 105 Non-current Assets Held for Sale and Discontinued Operations which
will become effective for the year ending 31 December 2010. Improvements to FRSs 2008 contain amendments to
numerous accounting standards that result in accounting changes for presentation, recognition or measurement
purposes and terminology or editorial amendments. The Group is in the process
of assessing the impact of these amendments.
INT FRS 113 will become effective for the Group’s financial statements for the year ending 31 December 2009. INT
FRS 113 concludes that where entities grant award credits as incentives to customers to buy their goods or services
(e.g. loyalty points or free products), such customer loyalty programmes should be accounted for by taking a multiple
sales approach, i.e. by deferring some of the revenue received from the initial sales transaction, to be recognised as
revenue as and when the entity provides the goods or services promised under the customer loyalty programmes. The
application of this Interpretation is not expected to have any significant impact on the Group’s financial statements.
INT FRS 116 will become effective for the Group’s financial statements for the year ending 31 December 2009. INT FRS
116 provides guidance on identifying foreign currency risks and hedging instruments that qualify for hedge accounting
in the hedge of a net investment in a foreign operation. It also explains how an entity should determine the amounts to
be reclassified from equity to profit or loss for both the hedging instrument and the hedged item. The application of this
Interpretation is not expected to have any significant impact on the Group’s financial statements.
Other than the changes in disclosures relating to FRS 1 and FRS 108, the initial application of these standards
(including their consequential amendments) and interpretations is not expected to have any material impact on the
Group’s financial statements.
The Group has not considered the impact of accounting standards issued after the balance sheet date.
46 Comparative information
The financial statements for the year ended 31 December 2007 were audited by another firm of Certified Public
Accountants.
Corporate Governance Statement
Hyflux continues to place great importance on the governance of the Company and its subsidiaries, which it believes
is vital to its well being and success. Hyflux is committed to best practice corporate governance and processes that will
enhance the Group’s effectiveness, ensure the appropriate degree of accountability and transparency and an increase in
long term value and return to shareholders.
The Group subscribes to the Code of Corporate Governance 2005 (“Code”) and believes that this forms a sound platform
for supporting good corporate governance practices.
This statement outlines the main corporate governance practices of the Group with specific reference made to the
principles and guidelines of the Code, forming part of the Continuing Obligations set out in the Singapore Exchange
Securities Trading Limited’s (“SGX-ST”) Listing Manual.
Hyflux will continue to review and refine its practices especially in light of the Audit Committee Guidance Committee
(“ACGC”) guidebook, and other standards of best practice that develop in the market, consistent with the needs and the
circumstances of the Group.
In developing the appropriate corporate governance practices, the Group takes into account all applicable legislation
and recognised standards. Hyflux is committed to instilling and maintaining good corporate governance at all times.
The Board is pleased to report that throughout the reporting period for the financial year ended 31 December 2008,
Hyflux complied with the Code’s principles and guidelines.
BOARD MATTERS
BOARD’S CONDUCT OF ITS AFFAIRS:
Principle 1: Effective Board to lead and control the Company
Role of the Board
The primary role of the Board is to protect and enhance long term shareholders value and on ensuring that the Company
is run in accordance with best international management and corporate governance practices, appropriate to the needs
and development of the Company.
The Board is responsible for general oversight of the Company’s activities and performance and for setting the Company’s
overall strategic direction. It provides leadership and guidance on corporate strategy, business directions, risk policy and
implementation of corporate objectives, thereby taking responsibility for the overall corporate governance of the Group.
In delegating responsibility for the day-to-day operation and leadership of the Company to the Executive Director
and Chief Executive Officer and the Management team, the Board has processes and systems in place to ensure that
significant issues, risks and major strategic decisions are monitored and considered at Board level.
To assist in the execution of its responsibilities, the Board has established several Board Committees namely; Audit
Committee, Nominating Committee, Remuneration Committee, Risk Management Committee and Executive Committee.
These Committees function within clearly defined terms of reference, which are reviewed on a regular basis.
Corporate Governance Statement (cont’d)
Matters which are specifically reserved to the full Board for decision are those involving material acquisitions, disposal
of assets, corporate or financial restructuring, share issuances, dividends and other returns to shareholders, conflict
of interest for substantial Shareholder or Director, and matters which require Board approval as specified under the
Company’s interested person transaction policy.
The Board held four meetings in the 2008 financial year. The Board may convene additional meetings to address any
specific significant matters that may arise from time to time.
A summary of attendance by Directors at Board and Board Committee Meetings for the financial year ended 31 December
2008 is set out as follows:
Risk
Board of Nominating Remuneration
Audit Committee Management
Directors Committee Committee
Committee
Name No. of No. of No. of No. of No. of No. of No. of No. of No. of No. of
Meetings Meetings Meetings Meetings Meetings Meetings Meetings Meetings Meetings Meetings
Held Attended Held Attended Held Attended Held Attended Held Attended
Olivia Lum 4 4 4 4* 1 1* 1 1* 3 2*
Teo Kiang Kok 4 4 4 4 1 1 1 1 3 3
Lee Joo Hai 4 4 4 4 1 1 1 1 3 3
Gay Chee Cheong 4 4 4 4 1 1 1 1 NA NA
Christopher
4 4 NA NA NA NA 1 1 3 3
Murugasu
Professor Tan
4 3 4 4 NA NA NA NA NA NA
Teck Meng
Raj Mitta 4 3 NA NA NA NA NA NA 3 3
Ahmed Butti
3 2 NA NA NA NA NA NA NA NA
Ahmed 1
Legend:
NA Not applicable
1
Mr Ahmed Butti Ahmed was appointed to the Board on 25 April 2008
* Attendance by invitation
BOARD COMPOSITION AND GUIDANCE

Principle 2: Strong and independent element on the Board
The eight members’ board of the Company in office and their memberships in the respective Board Committees for the
financial year ended 31 December 2008 are set out as follows:
Risk
Audit Nominating Remuneration Executive
Name Board Management
Committee Committee Committee Committee
Committee
Ms Olivia Lum Executive Director Chairman
Non-Executive,
Mr Teo Kiang
Non-Independent Member Member Member Member Member
Kok
Director
Non-Executive,
Mr Lee Joo Hai Chairman Member Member Member Member
Independent Director
Mr Gay Chee Non-Executive,

Member Chairman Member Member
Cheong Independent Director
Non-Executive,
Mr Christopher
Non-Independent Member Member
Murugasu
Director
Professor Tan Non-Executive,

Member Chairman
Teck Meng Independent Director
Non-Executive,
Mr Raj Mitta Chairman
Independent Director
Non-Executive,
Mr Ahmed
Non-Independent
Butti Ahmed
Director
The Board considers an Independent Director as one who has no relationship with the Company, its related Companies
or its officers that could interfere or be reasonably perceived to interfere, with the exercise of the Director’s independent
business judgment.
While all the Directors have equal responsibilities for the performance of the Group, Non-Executive members of the
Board exercise no management function in the Company or any of its subsidiaries. The role of Non-Executive Directors
is primarily to ensure that the strategies proposed by the Management are fully discussed, vigorously examined, taking
into consideration the long term interest of the shareholders, employees, customers, suppliers and the communities in
which the Group conducts its business.
The Board believes the composition of the Board requires consideration of a number of factors, including the mix in skills,
abilities and expertise, the mix in the length of time Directors have had on the Board, as well as experience on other boards.
The general policy of the Company is to seek to have the Board comprised of at least half Independent Directors.
The Board is of the view that there is presently a good balance between the Executive and Non-Executive Directors and
a strong and independent element on the Board. The present board size and number of Board Committees facilitate
effective decision making and is appropriate for the nature and scope of the Group’s business and operations.
The Board consists of respected business leaders and professionals whose collective core competencies and experience
are extensive, diverse and relevant to the Group. The names, qualifications and relevant skills, experience and expertise
of the Directors can be found on pages 12 and 13 of this report. As evidenced by this information, the Directors bring to
the Board a broad range of experience and expertise.
CHAIRMAN AND CHIEF EXECUTIVE OFFICER (“CEO”)
Principle 3: Clear division of responsibilities at the top of the Company
The Board does not have a chairman on the Board of Directors. Responsibilities for various functions and departments
in the Group are well defined. The Board is of the opinion that the process of decision making by the Board has been
independent, based on collective decisions without any individual exercising any considerable concentration of power
or influence.
BOARD MEMBERSHIP
Principle 4: Formal and transparent process for appointment of new Directors to the Board
The Nominating Committee (“NC”) has been tasked by the Board to identify, select and recommend individuals with
the appropriate skills, expertise and experience for appointment, thereby ensuring a balanced and effective board at
all times.
Newly appointed Directors are provided with a training and induction programme, so as to familiarise him with the
Group’s structure and its business.
The NC comprises of three Directors:
Mr Gay Chee Cheong (Chairman).

Mr Lee Joo Hai.
Mr Teo Kiang Kok.
The primary function and duties of the NC are outlined as follows:
1. to make recommendations to the Board on all board appointments and re-nominations having regard to the Director’s
contribution and performance (e.g. attendance, preparedness, participation, candour, and any other salient factors);
2. to ensure that all Directors would be required to submit themselves for re-nomination and re-election at regular
intervals and at least once in every three years;
3. to determine annually whether a Director is independent, in accordance with the independence guidelines in
the Code;
4. to review whether a Director is able to and has adequately carried out his duties as a Director of the Company in
particular where the Director concerned has multiple board representations; and
5. to consider how the Board’s performance may be evaluated and to propose objective performance criteria.
The NC conducts an annual review of Directors’ independence and based on the Code’s criteria for independence, the
NC is of the view that, in respect of the financial year ended 31 December 2008; Professor Tan Teck Meng, Mr Gay Chee
Cheong, Mr Lee Joo Hai, Mr Raj Mitta, are deemed independent.
The NC has recommended the nomination of Directors retiring by rotation under the Company’s Articles of Association,
namely, Mr Teo Kiang Kok and Mr Christopher Murugasu.
In reviewing the nomination of the retiring Directors, the NC considered the performance and contribution of each of
the retiring Directors, having regard not only to their attendance and to participation at Board and Board Committee
meetings but also the time and efforts devoted to the Group’s business and affairs.
BOARD PERFORMANCE
Principle 5: Formal assessment of the effectiveness of the Board and contributions by each Director
The Code recommends that the NC be responsible for assessing the Board as a whole and the individual Director’s
contribution. The NC believes that it is more appropriate and effective to assess the Board as a whole, bearing in mind
that each member of the Board contributes in different ways to the success of the Group.
The NC in conducting the evaluation and appraisal process focuses on a set of performance criteria which includes
the evaluation of the size and composition of the Board, the Board’s access to information, Board processes and
accountability, Board performance in relation to discharging its principal responsibilities and the Directors’ standards
of conduct.
The Board is of the view that the financial indicators set out in the Code as a guide for the evaluation of the Board
and its Directors, may not be appropriate; as they are more relevant as a form of measurement of the Management’s
performance. The NC conducted a Board performance evaluation to assess the effectiveness of the Board in respect of
the financial year ended 31 December 2008 and is satisfied that sufficient effort, time and attention has been given by
the Directors to the affairs of the Group.
ACCESS TO INFORMATION
Principle 6: Board members to have complete, adequate and timely information
The Board has separate and independent access to members of the senior management team of the Group, the
Company Secretary and the external auditors at all times. The Directors also have unrestricted access to the Company’s
records and information, all minutes of meetings held by the Board and Board Committees, and management accounts
to enable them to carry out their duties.
The Company Secretary attends all Board and Board Committee meetings. The Company Secretary administers, attends
and prepares minutes of the Board and Board Committee meetings, and assists in ensuring that Board procedures are
followed and reviewed in accordance with the Company’s Articles of Association so that the Board functions effectively
and the relevant rules and regulations applicable to the Company are complied with. The Company Secretary’s role is
to advise the Board on all governance matters, ensuring that legal and regulatory requirements as well as board policies
and procedures are complied with.
Should Directors, whether as a group or individually, require professional advice, the Company shall upon the direction
of the Board, appoint a professional advisor selected by the Group or the individual, approved by the Management, to
render the service. The costs of such service shall be borne by the Company.
PROCEDURES FOR DEVELOPING REMUNERATION POLICIES
Principle 7: Formal and transparent procedure for fixing remuneration packages of Directors and senior management
The Remuneration Committee (“RC”) comprises of five Directors :
Professor Tan Teck Meng (Chairman).

Mr Gay Chee Cheong.
Mr Lee Joo Hai.
Mr Teo Kiang Kok.
Mr Christopher Murugasu.
The RC is committed to the principles of accountability and transparency; and to ensuring that remuneration
arrangements demonstrate a clear link between reward and performance.
The RC is responsible for ensuring a formal and transparent procedure for developing policy on executive remuneration,
and for fixing the remuneration packages of individual Directors and members of the senior management team.
The RC’s review covers all aspects of remuneration including but not limited to, Directors’ fees, salaries, allowances,
bonus, employees share options and benefits in kind and specific remuneration package for each Director.
In structuring a compensation framework for Executive Director and senior management employees, the RC seeks to
link a proportion of the compensation to the Group’s performance. Its recommendations are made in consultation with
the Executive Committee and submitted for endorsement by the Board. No Director is involved in deciding his own
remuneration. The RC, when deemed necessary, may obtain expert advice with regards to remuneration matters.
LEVEL AND MIX OF REMUNERATION
Principle 8: The level of remuneration for Directors should be adequate, not excessive, and linked to performance
The remuneration policy of the Company is to provide compensation packages at market rates, which reward
performance and attract, retain and motivate Directors and members of the senior management team.
The Executive Director does not receive Directors’ fees. The Executive Director and senior management employees’
remuneration packages are based on service contracts and their remuneration is determined by having due regard to
the performance of the individuals, the Group as well as market trends.
Non-Executive Directors are paid yearly Directors’ fees of an agreed amount based on their contributions, taking into
account factors such as effort and time spent, responsibilities of the Directors and the need to pay competitive fees to
attract, motivate and retain Directors.
DISCLOSURE ON REMUNERATION
Principle 9: Clear disclosure of remuneration policy, level and mix of remuneration, and the procedure for setting the
remuneration
An appropriate and attractive level of remuneration has been set to attract, retain and motivate Directors and employees.
The remuneration package for Executive Director and employees consists of both fixed and variable components. The
variable component is determined based on the performance of the individual employee and the Group’s performance
in the relevant financial year. Annual increments and adjustments to remuneration are reviewed and approved taking
into account the outcome of the annual appraisal of the employees.
Non-Executive Directors are paid Directors’ fees that are subject to shareholders’ approval at the Company’s Annual
General Meeting (“AGM”). The RC recommends a total Directors’ fees of $ 574,110 be paid to Non-Executive Directors for
the financial year ended 31 December 2008. This will be tabled for the shareholders’ approval at the forthcoming AGM.
Details of the Directors receiving remuneration from the Group for the year ended 31 December 2007 and 2008 are set
out as follows:
Number of Directors
Remuneration band 2008 2007
S$500,000 and above 0 0

S$250,000 to below S$500,000 1 1
Below S$250,000 7 7
The following table sets out the summary compensation for Directors and top five key executives for the financial year
ended 31 December 2008:
Allowances
and other
DIRECTORS Salary Bonus Fees benefits Total
Between S$250,000 to S$500,000

Olivia Lum 89% 7% 0% 3% 100%
Below S$250,000
Gay Chee Cheong 0% 0% 100% 0% 100%
Lee Joo Hai 0% 0% 100% 0% 100%
Teo Kiang Kok 0% 0% 100% 0% 100%
Christopher Murugasu 0% 0% 100% 0% 100%
Professor Tan Teck Meng 0% 0% 100% 0% 100%
Raj Mitta 0% 0% 100% 0% 100%
Ahmed Butti Ahmed 0% 0% 100% 0% 100%
Allowances
and other
Top five key executives Salary Bonus Fees benefits Total
S$500,000 and above

Ong Eng Keang Sam 62% 31% 0% 7% 100%
Between S$250,000 to S$500,000
Cho Wee Peng 71% 29% 0% 0% 100%
Fong Chun Hoe 83% 17% 0% 0% 100%
Tan Eng Seng Benjamin 68% 17% 0% 15% 100%
Wu Siu Kin Peter 68% 21% 0% 11% 100%
Immediate family member of a Director

Below S$250,000
Teo Yuan Cheng Casey 96% 4% 0% 0% 100%
Immediate Family Members of Directors
There are no immediate family members of Directors or controlling shareholders in employment with the Group and
whose remuneration exceeds S$150,000 during financial year ended 31 December 2008.
ACCOUNTABILITY
Principle 10: Board should present a balanced and understandable assessment of the Company’s performance, position
and prospects
The Board promotes timely and balanced disclosure of all material matters concerning the Group. It updates shareholders
on the operations and financial position of the Group through quarterly, half yearly and full year results announcements
as well as timely announcements of other matters as prescribed by the SGX-ST’s Listing Manual requirements and other
relevant rules and regulations.
The Board is accountable to shareholders for the management of the Group and the Management is accountable to the
Board by providing the Board with the necessary information for the discharge of its duties.
AUDIT COMMITTEE
Principle 11: Establishment of Audit Committee with written terms of reference
The Audit Committee (“AC”) comprises the following members:
Mr Lee Joo Hai (Chairman).

Mr Gay Chee Cheong.
Mr Teo Kiang Kok.
Professor Tan Teck Meng.
In accordance with the principles in the Code, the AC comprises of Non-Executive Directors, majority of whom are
independent. The members of AC, collectively, have expertise and extensive experience in legal, accounting, financial
management and business, and are qualified to discharge the AC’s responsibilities.
The primary functions of the AC are as follows:
1. assists the Board in discharging its statutory responsibilities on financial and accounting matters;
2. reviews the financial and operating results and accounting policies of the Group;
3. reviews significant financial reporting issues and judgments relating to financial statements for each financial year,
interim and annual results announcement before submission to the Board for approval;
4. reviews the adequacy of the Company’s internal control (financial and operational) and risk management policies
and systems established by the Management;
5. reviews the audit plans and reports of the external and internal auditors and consider the effectiveness of the
actions taken by the Management on the auditors’ recommendations;
6. appraises and reports to the Board on the audits undertaken by the external and internal auditors, the adequacy
of the disclosure of information, and the appropriateness and quality of the system of management and internal
controls;
7. reviews the independence of external auditors annually and consider the appointment or re-appointment of
external auditors and matters relating to the resignation or removal of the auditors and approve the remuneration
and terms of engagement of the external auditors; and
8. reviews interested person transactions, as defined in the Listing Manual of the SGX-ST.
In fulfilling its responsibilities, the AC receives regular reports from the Management and the external auditors, KPMG.
The AC has full access to and co-operation of the Management and meets with KPMG in private at least once a year, and
more frequently, if necessary.
The AC has explicit authority within the scope of its responsibilities to seek any information it requires or investigate any
matter within its terms of reference. The AC has adequate resources to enable it to discharge its responsibilities properly.
The Group has put in place a confidential communication programme as endorsed by the AC. Employees may, in
confidence, raise concerns about possible corporate improprieties in matters of financial reporting or other matters
and to ensure that arrangements are in place for the independent investigations of such matters and for appropriate
follow up actions. The details of the confidential communication policies and arrangements have been made available
to all employees.
INTERNAL CONTROLS
Principle 12: The Board to ensure that the Management maintains a sound system of internal controls to safeguard the
shareholders’ investments and the company’s assets
The AC is fully aware of the need to put in place a system of internal controls within the Group to safeguard the
shareholders’ interests and the Group’s assets, and to manage risks. The system is intended to provide reasonable but
not absolute assurance against material misstatements or loss, and to safeguard assets and ensure maintenance of
proper accounting records, reliability of financial information, compliance with appropriate legislation, regulation and
best practice, and the identification and containment of business risks.
The Group regularly reviews and improves its business and operational activities to identify areas of significant business
risks as well as taking appropriate measures to control and mitigate these risks. The Group reviews all significant control
policies and procedures and highlights all significant matters to the AC and the Board. The financial risk management
objectives and policies are outlined in the financial statements. Risk Management alone does not guarantee that business
undertakings will not fail. However, by identifying and managing risks that may arise, the Group is in a position to make
more informed decisions and will benefit from a better balance between risk and reward. This will assist in protecting
and creating shareholders’ value.
Based on the information provided to the AC, it is not aware of any issues causing it to believe that the system of internal
controls and risk management as inadequate.
INTERNAL AUDIT
Principle 13: Setting up independent internal audit function
The Group has put in place a dedicated team of internal auditors. The internal audit function includes reviewing the
effectiveness of the material internal controls of the Group. The Internal Audit Director reports directly to the Chairman
of the AC and has an appropriate standing within the Group. The AC meets with the Internal Auditor in private at least
once a year. The AC also ensures that the internal audit function is adequately resourced, and reviews annually the
adequacy of the internal audit function. The internal audit team meets the standards set by nationally and internationally
recognised professional bodies including the Standards for the Professional Practice of Internal Auditing set by The
Institute of Internal Auditors.
Within this framework, the internal audit function provides reasonable assurance that the risks incurred by the Group in
each major activity will be identified, analysed and managed by the Management. The Internal Auditor will also make
recommendations to enhance the effectiveness and security of the Group’s operations.
COMMUNICATION WITH SHAREHOLDERS
Principle 14: Regular, effective and fair communication with shareholders
Principle 15: Shareholders’ participation at AGM
The Company is committed to regular and proactive communication with its shareholders. It aims to provide shareholders
with clear, balanced useful and material information on a timely basis to ensure that shareholders receive a balanced and
up-to-date view of the Group’s performance and business.
Where there is inadvertent disclosure made to a selected group, the Company will make the same disclosure publicly as
soon as practicable. Communication is made through:
1. annual reports that are prepared and issued to all shareholders. The Board makes every effort to ensure that the
annual report includes all relevant information about the Group, including future development and other disclosures
required by the Companies’ Act, Chapter 50, and Singapore Statements of Accounting Standards;
2. quarterly and full-year financial statements comprising a summary of the financial information and affairs of the
Group for the relevant period;
3. explanatory memoranda for AGM and extraordinary general meetings;
4. press releases on major developments of the Group;
5. disclosures to the SGX-ST via SGXNET; and
6. the Group’s website at http://www.hyflux.com at which shareholders can access information of the Group at all
times.
In addition, shareholders are encouraged to attend the Company’s AGM to ensure a high level of accountability and to
stay informed of the Group’s strategies and growth.
In accordance with the principles in the Code, the full Board of Directors and the external auditor in office are required
to attend the Company’s AGM and will address any question raised at the meeting. The Group fully supports the Code’s
principle to encourage active shareholder participation.
RISK MANAGEMENT COMMITTEE
The Risk Management Committee (“RMC”) comprises the following members:
Mr Raj Mitta (Chairman).

Mr Christopher Murugasu.
Mr Lee Joo Hai.
Mr Teo Kiang Kok.
The functions of the RMC are as follows:
1. to review with the Management, and, where needed, with external consultants on areas of risk that may affect the
viability and smooth operations of the Company, as well as the Management’s risk mitigation efforts, with the view
of safeguarding shareholder’s interest and Group assets;
2. to direct and work with Management to develop and review policies and processes to address and manage
identified areas of risk in a systematic and structured manner;
3. to make recommendations to the Board in relation to business risks that may affect the Company, as and when
these may arise;
4. to review new investments; and
5. to perform any other functions as may be agreed by the Board.
Executive Committee
The Executive Committee is an executive arm of the Board and the Board Committees.
The members of the Executive Committee are:
Ms Olivia Lum (Chairman).

Mr Lee Joo Hai.
Mr Teo Kiang Kok.
Mr Gay Chee Cheong.
The main functions of the Executive Committee are:
1. to make recommendations to the Board and the Board Committees on the businesses and the affairs of the
Company and its subsidiaries and affiliates;
2. to participate in the deliberations of the Board and the Board Committees as appropriate, subject to such direction
as the Chairman of the Board or the Board Committee may give;
3. to implement the decisions of the Board and the Board Committees; and
4. to undertake assignments as the Board or any Board Committee may direct from time to time.
Management Committee
The members of the Management Committee for financial year ending 31 December 2009 are:
Ms Olivia Lum (Chairman).

Mr Sam Ong.
Mr Cho Wee Peng.
Mr Fong Chun Hoe.
Mr Foo Hee Kiang.
Ms Winnifred Heap.
Mr Lee Soon Eng.
DEALING IN SECURITIES
The Company has adopted its own internal compliance code pursuant to the SGX-ST’s best practices on dealings in
securities and these are applicable to all its officers in relation to their dealings in the Company’s securities. Its officers
are advised not to deal in the Company’s shares during the period commencing two weeks or one month before the
announcement of the Company’s interim or full year results respectively, or if they are in possession of unpublished price
sensitive information of the Company. In addition, its Directors and officers are expected to observe insider trading laws
at all times even when dealing in securities within the permitted trading period.
The Group has complied with the Best Practices Guide on Securities Transactions issued by the SGX-ST.
MATERIAL CONTRACTS
There are no material contracts of the Company or its subsidiaries involving the interests of the Managing Director, each
Director or Controlling shareholders, either still subsisting at the end of the financial year or entered into since the end
of the previous financial year.
INTERESTED PARTY TRANSACTION
The Group has established procedures to ensure that all transactions with interested persons are reported on a timely
manner to the AC and that the transactions are at arm’s length basis. All interested person transactions are subject to
review by the AC to ensure compliance with the established procedures.
Supplementary Information
Material Contracts
There were no material contracts of the Company or its subsidiaries involving the interests of the Chief Executive Officer
(as defined in the SGX-ST Listing Manual), each Director or Controlling shareholder, either still subsisting at the end of
the financial year or entered into since the end of the previous financial year.
Interested party transaction
The Group has established procedures to ensure that all transactions with interested persons are reported on a timely
manner to the Audit Committee and that the transactions are at arm’s length basis. All interested person transactions are
subject to review by the Audit Committee to ensure compliance with the established procedures.
Aggregate value of all interested

person transactions during the financial
year under review (excluding transactions Aggregate value of all interested
conducted under shareholders’ mandate person transactions conducted under
Name of pursuant to Rule 920 under shareholders’ mandate pursuant to
interested person SGX-ST Listing Manual) Rule 920 under SGX-ST Listing Manual
BDO Raffles Consultants S$23,000 in respect of the internal audit NIL

Pte Ltd services rendered
Shook Lin & Bok S$77,000 in respect of trademark application NIL

services rendered
Supplementary Information (cont’d)
Major properties held for development

Approximate Expected Group’s
Site area Intended total lettable Stage of date of effective
Description Location (sqm) use area (sqm) completion completion interest (%)
Factory and 8 Tuas South Lane 77,172 Industrial 5,575 52% of phase 1 1 April 2009 100
warehouse Singapore 637302 (upon completion (total 3 phases) (phase 1 only)
of phase 1)

Approximate Group’s
Site area total lettable effective
Description Location (sqm) Existing use area (sqm) interest (%) Tenure
Major properties held for investment

Office 40 Changi South 2,426 Office 1,328 100 60 years
Street 1 commencing
Singapore 486764 from 1 December
1996
Other major properties

Office and 5 Changi South 10,472 Office and 5,630 100 60 years
factory Street 1, factory commencing
Singapore 486764 from 1 March
1997
Factory No. 99 Juli Road 8,297 Office and 7,647 100 50 years
Zhangjiang factory commencing
High-Tech Park from 26 April
Pudong Shanghai, 2001
China 201203
Office and 8# Factory in 18,040 Office and 23,115 100 50 years
factory EPZ, 9# Yang factory commencing
Zi Jiang South from 2007
Road, Yangzhou
Jiangsu Province,
China
Office 1307-1309 Centre 384 Office 232 100 50 years
Plaza 188, commencing
Jiefangbei HePing, from 12 June
District Tianjin, 1994
China 300042
Office and No. 99 Tai Zhen 25,959 Office and 12,980 100 50 years
factory Road, Bin Jiang factory commencing
Industrial Park, from 25
Taizhou Economic March 2007
Development Zone,
Taizhou City, Jiangsu
Province, China
Statistics of Shareholdings
As at 10 March 2009
Share Capital
Class of shares: Ordinary shares
Voting rights: One vote per share
Total number of issued shares: 525,287,360
Distribution of Shareholdings
No. of
Size of Shareholdings Shareholders % No. of Shares %

1-999 331 4.10 153,451 0.03
1,000-10,000 6,799 84.15 25,846,676 4.92
10,001-1,000,000 928 11.49 33,103,965 6.30
1,000,001 and above 21 0.26 466,183,268 88.75
Total 8,079 100.00 525,287,360 100.00
Twenty Largest Shareholders
S/No. Name No. of Shares %
1. Olivia Lum 167,484,141 31.88

2. DBS Nominees Pte Ltd 80,172,159 15.26
3. Citibank Nominees Singapore Pte Ltd 57,467,153 10.94
4. HSBC (Singapore) Nominees Pte Ltd 47,358,648 9.02
5. Merrill Lynch (Singapore) Pte Ltd 28,196,574 5.37
6. United Overseas Bank Nominees Pte Ltd 25,377,336 4.83
7. Nomura Singapore Limited 10,437,000 1.99
8. Raffles Nominees Pte Ltd 9,232,381 1.76
9. Murugasu Deirdre 8,014,178 1.53
10. DBSN Services Pte Ltd 5,598,904 1.07
11. DB Nominees (S) Pte Ltd 5,047,323 0.96
12. Morgan Stanley Asia (Singapore) Securities Pte Ltd 3,332,186 0.63
13. ABN Amro Nominees Singapore Pte Ltd 2,745,000 0.52
14. Foo Hee Kiang 2,629,912 0.50
15. UOB Kay Hian Pte Ltd 2,544,937 0.48
16. Tommie Goh Thiam Poh 2,370,375 0.45
17. Phillip Securities Pte Ltd 2,208,592 0.42
18. Yong Siew Yoon 2,000,000 0.38
19. Koh Lip Lin 1,590,789 0.30
20. DBS Vickers Securities (Singapore) Pte Ltd 1,190,000 0.23
Total 464,997,588 88.52
Approximately 66% of the Company’s shares are held in the hands of public. Accordingly, the Company has complied
with Rule 723 of the Listing Manual of SGX-ST.
Substantial Shareholders
As at 10 March 2009
Name of Shareholder Direct Interest Deemed Interest %
Olivia Lum 167,484,141 10,000,000* 33.78
* Shares held in the name of nominees

Notice of Annual General Meeting
NOTICE IS HEREBY GIVEN that the Annual General Meeting of Hyflux Ltd (“Company”) will be held at 202 Kallang Bahru,
Hyflux Building, Singapore 339339 on 28 April 2009 at 2.00p.m. for the following purposes:
(A) AS ORDINARY BUSINESS
Resolution 1
To receive and adopt the Directors’ Report and the Audited Accounts for the year ended 31 December 2008 together
with the Auditors’ Report thereon.
Resolution 2
To declare a first and final dividend of 3.43 Singapore cents per ordinary share (one-tier tax exempt) for the year ended
31 December 2008 (previous year: 1.89 Singapore cents per ordinary share).
Resolution 3
To re-elect Mr Teo Kiang Kok who retires in accordance with Article 89 of the Company’s Articles of Association and who,
being eligible, offers himself for re-election.
Resolution 4
To re-elect Mr Christopher Murugasu who retires in accordance with Article 89 of the Company’s Articles of Association
and who, being eligible, offers himself for re-election.
Resolution 5
To approve the payment of Directors’ fees of S$574,110 for the year ended 31 December 2008 (previous year:
S$456,667).
Resolution 6
To re-appoint Messrs KPMG LLP as external auditors and to authorise the Directors to fix their remuneration.
(B) AS SPECIAL BUSINESS
To consider and if thought fit, to pass the following resolutions as Ordinary Resolutions, with or without any
modifications:
Resolution 7
That pursuant to Section 161 of the Companies Act, Cap. 50 and Rule 806 of the Listing Manual of the Singapore
Exchange Securities Trading Limited, the Directors be authorised and empowered to:
(a) (i) issue shares in the Company (“shares”) whether by way of rights, bonus or otherwise; and/or
(ii) make or grant offers, agreements or options (collectively, “Instruments”) that might or would require shares to
be issued, including but not limited to the creation and i ssue of (as well as adjustments to) options, warrants,
debentures or other i nstruments convertible into shares,
at any time and upon such terms and conditions and for such purposes and to such persons as the Directors may
in their absolute discretion deem fit; and
Notice of Annual General Meeting (cont’d)
(b) (notwithstanding the authority conferred by this Resolution may have ceased to be in force) issue shares in
pursuance of any Instrument made or granted by the Directors while this Resolution was in force, provided that:
(1) the aggregate number of shares (including shares to be issued in pursuance of the Instruments, made or
granted pursuant to this Resolution) and Instruments to be issued pursuant to this Resolution shall not exceed
fifty per centum (50%) of the issued shares in the capital of the Company (as calculated in accordance with
sub-paragraph (2) below), of which the aggregate number of shares and Instruments to be issued other than
on a pro rata basis to existing shareholders of the Company shall not exceed twenty per centum (20%) of the
issued shares in the capital of the Company (as calculated in accordance with sub-paragraph ( 2) below);
(2) (subject to such calculation as may be prescribed by the Singapore Exchange Securities Trading Limited) for
the purpose of determining the aggregate number of shares and Instruments that may be issued under sub-
paragraph (1) above, the percentage of issued shares and Instruments shall be based on the number of issued
shares in the capital of the Company at the time of the passing of this Resolution, after adjusting for:
(a) new shares arising from the conversion or exercise of the Instruments or any convertible securities;
(b) new shares arising from the exercising share options or vesting of share awards outstanding and subsisting
at the time of the passing of this Resolution; and
(c) any subsequent consolidation or subdivision of shares.
(3) in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of
the Listing Manual of the Singapore Exchange Securities Trading Limited for the time being in force (unless
such compliance has been waived by the Singapore Exchange Securities Trading Limited) and the Articles of
Association of the Company; and
(4) unless revoked or varied by the Company in a general meeting, such authority shall continue in force (i) until
the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual
General Meeting of the Company is required by law to be held, whichever is earlier or (ii) in the case of shares
to be issued in pursuance of the Instruments, made or granted pursuant to this Resolution, until the issuance
of such shares in accordance with the terms of the Instruments.
Resolution 8
That pursuant to Section 161 of the Companies Act, Cap. 50, the Directors be authorised and empowered to offer
and grant options under the Hyflux Employees’ Share Option Scheme (“Scheme”) and to issue from time to time such
number of shares in the capital of the Company as may be required to be issued pursuant to the exercise of options
granted by the Company under the Scheme, whether granted during the subsistence of this authority or otherwise,
provided always that the aggregate number of additional ordinary shares to be allotted and issued pursuant to the
Scheme shall not exceed fifteen per centum (15%) of the issued shares in the capital of the Company from time to time
and that such authority shall, unless revoked or varied by the Company in a general meeting, continue in force until the
conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting
of the Company is required by law to be held, whichever is the earlier.
Notice of Annual General Meeting (cont’d)
Resolution 9
That the Directors of the Company be and are hereby authorised to make purchases of issued and fully-paid ordinary
shares in the capital of the Company from time to time (whether by way of market purchases or off-market purchases
on an equal access scheme) of up to ten per centum (10%) of the issued ordinary shares in the capital of the Company
(ascertained as at the date of the last Annual General Meeting of the Company or at the date of the EGM, whichever is
the higher, but excluding any shares held as treasury shares) at the price of up to but not exceeding the Maximum Price
as defined in the Company’s Circular dated 4 April 2008 and in accordance with the Guidelines on Share Purchase set out
in Appendix 1 of the said Circular and this mandate shall, unless revoked or varied by the Company in general meeting,
continue in force until the conclusion of the next annual general meeting of the Company is held or is required by law
to be held, whichever is earlier.
To transact any other ordinary business which may properly be transacted at an Annual General Meeting.
By Order of the Board
Lim Poh Fong

Company Secretary
Singapore, 9 April 2009
Notes:
1. A Member entitled to attend and vote at the Annual General Meeting (the “Meeting”) is entitled to appoint a proxy to attend and
vote in his/her stead. A proxy need not be a Member of the Company. The instrument appointing a proxy must be deposited at
the Registered Office of the Company at 202 Kallang Bahru, Hyflux Building, Singapore 339339 not less than 48 hours before the
time appointed for holding the Meeting.
2. In relation to Resolution 3, Mr Teo Kiang Kok, will upon re-election as a Director of the Company, remain as a member of the Audit,
Remuneration, Nominating and Risk Management Committees and is considered a non-executive and independent director.
3. In relation to Resolution 4, Mr Christopher Murugasu will, upon re-election as a Director of the Company, remain as a member
of the Remuneration and Risk Management Committees and is considered a non-executive and non-independent director.
4. Ordinary Resolution 7 has been proposed for voting and passed annually at the Company’s AGM since 2002. Pursuant to Section
161 of the Companies Act, Cap. 50 and Rule 806 of the Listing Manual of the Singapore Exchange Securities Trading Limited,
and upon passing of this Ordinary Resolution, the Directors will be empowered from the date of this Meeting until the date of
the next AGM, or the date by which the next AGM is required by law to be held or such authority is varied or revoked by the
Company in a general meeting, whichever is the earlier, to issue shares, make or grant instruments convertible into shares and
to issue shares pursuant to such instruments, up to a number not exceeding, in total, 50% of the issued shares in the capital
of the Company, of which up to 20% may be issued other than on a pro rata basis to existing shareholders. In determining the
aggregate number of shares that may be issued, the percentage of issued shares in the capital of the Company will be calculated
based on the issued shares in the capital of the Company at the time this Ordinary Resolution is passed after adjusting for new
shares arising from the conversion or exercise of the Instruments or any convertible securities, the exercise of share options or
the vesting of share awards outstanding or subsisting at the time when this Ordinary Resolution is passed and any subsequent
consolidation or subdivision of shares. It is further noted that the 50% limit proposed by this Ordinary Resolution is below the
limit permitted by the Listing Manual.
5. Ordinary Resolution 8 has been proposed for voting and passed annually since 2002. The Directors believe that an appropriate
remuneration package is required to recruit, retain and reward talents for performance. Pursuant to Section 161 of the
Companies Act, Cap. 50 and upon passing of this Ordinary Resolution, the Directors will be empowered from the date of
this Meeting until the next AGM, or the date by which the next AGM is required by law to be held or such authority is varied
or revoked by the Company in a general meeting, whichever is the earlier, to issue shares in the Company pursuant to the
exercise of options granted or to be granted under the Scheme up to a number not exceeding in total (for the entire duration
of the Scheme) 15% of the issued shares in the capital of the Company from time to time.
6. Ordinary Resolution 9 relates to the renewal of the share purchase mandate, which was originally approved by the shareholders
on 25 April 2008. Ordinary Resolution 9, if passed, will empower the Directors of the Company from the date of this Meeting
until the next AGM, or the date by which the next AGM is required by law to be held, whichever is the earlier, to purchase
ordinary shares of the Company by way of market purchases or off-market purchases of up to 10% of the total number of
issued shares in the capital of the Company at the Maximum Price as defined in the Company’s Circular dated 4 April 2008.
The Company did not purchase any shares of the Company in the financial year ended 31 December 2008.
Appendix 1
SUMMARY SHEET FOR RENEWAL OF SHARES PURCHASE MANDATE
The SGX-ST assumes no responsibility for the correctness of any of the statements made, reports contained or opinions
expressed in this Appendix. If you are in doubt as to the action that you should take, you should consult your stockbroker
or other professional adviser immediately.
(A) Shares Purchased In The Previous Twelve Months
Pursuant to the Shares Purchase Mandate obtained at the Annual General Meeting on 25 April 2008, the
Company had not bought back any ordinary shares in the capital of the Company (“Shares”) by way of market
or off-market acquisitions.
(B) Renewal of The Shares Purchase Mandate
The Ordinary Resolution No. 9 if passed at the Annual General Meeting, will renew the Shares Purchase Mandate
approved by the Shareholders of the Company from the date of the Annual General Meeting until the date that the
next annual general meeting of the Company is held or is required by law to be held, whichever is the earlier.
(C) Rationale For The Shares Purchase Mandate
Short-term speculation may at times cause the market price of the Company’s Shares to be depressed below the
true value of the Company and the Group. The proposed Shares Purchase Mandate will provide the Directors with
the means to restore investors’ confidence and to protect existing Shareholders’ investments in the Company in a
depressed share-price situation through judicious Shares purchases to enhance the earnings per Share and/or the
net asset value per Share. The Shares purchases will enhance the net asset value per Share if the Shares purchases
are made at a price below the net asset value per Share.
The proposed Shares Purchase Mandate will also provide the Company with an expedient and cost-effective
mechanism to facilitate the return of surplus cash reserves to the shareholders, as and when the Directors are of the
view that this would be in the best interests of the Company and the shareholders.
The Directors will only make a Shares purchase as and when the circumstances permit and only if the Directors
are of the view that such purchases are in the best interests of the Company and the shareholders. The Directors
will decide whether to purchase Shares only after taking into account, among other things, the market conditions
at such time, the Company’s financial condition and whether such purchases will cause the Company to become
insolvent (i.e. the Company is unable to pay its debts as they become due in the ordinary course of business, or the
value of the Company’s assets is less than the value of its liabilities including contingent liabilities), and whether
such purchases represent the most efficient and cost-effective approach to enhance Share value. Shares purchases
will only be made if the Directors believe that such purchases are likely to benefit the Company and increase
economic value for shareholders.
The Directors will ensure that the Shares purchases will not have any effect on the listing of the Company’s
securities including the Shares listed on the Singapore Exchange Securities Trading Limited (the “SGX-ST”). Rule
723 of the Listing Manual of the SGX-ST requires at least ten per cent. (10%) of any class of a company’s listed
securities to be held by the public at all times. The Directors shall safeguard the interests of public shareholders
before undertaking any Shares purchases. Before exercising the Shares Purchase Mandate, the Directors shall at all
times take due cognisance of (a) the then shareholding spread of the Company in respect of the number of Shares
held by substantial shareholders and by non-substantial shareholders and (b) the volume of trading on the SGX-ST
in respect of the Shares immediately before the exercise of any Shares purchase.
Appendix 1 (cont’d)
Currently, 346,733,844 Shares (66%) of a total of 525,318,360 Shares issued by the Company are held by 8,075
public shareholders. The Company is of the view that there is sufficient number of Shares in issue held by public
shareholders which would permit the Company to undertake Shares purchases of up to ten per cent. (10%) of its
issued ordinary share capital without affecting the listing status of the Shares on the SGX-ST. The Company will
ensure that the Shares purchases will not cause market illiquidity or affect orderly trade.
(D) Financial Impact Of The Proposed Shares Purchases
1. The purchased Shares shall be cancelled immediately on purchase or acquisition unless held in treasury
in accordance with Section 76H of the Companies Act (Cap. 50) (the “Act”). Section 76H of the Act allows
purchased Shares to be:
(i) held by the Company; or
(ii) dealt with, at any time, in accordance with Section 76K of the Act, as Treasury Shares.
Section 76K of the Act allows the Company to:
(i) sell the Shares (or any of them) for cash;
(ii) transfer the Shares (or any of them) for the purposes of or pursuant to an employees’ share scheme;
(iii) transfer the Shares (or any of them) as consideration for the acquisition of shares in or assets of another
company or assets of a person; or
(iv) cancel the Shares (or any of them).
The aggregate number of Shares held as Treasury Shares shall not at any time exceed ten per cent. (10%) of
the total number of Shares at that time. Any Shares in excess of this limit shall be disposed of or cancelled in
accordance with Section 76K of the Act within six (6) months.
Any Shares purchase will:
(i) reduce the amount of the Company’s share capital where the Shares were purchased or acquired out of
the capital of the Company;
(ii) reduce the amount of the Company’s profits where the Shares were purchased or acquired out of the
profits of the Company; or
(iii) reduce the amount of the Company’s share capital and profits proportionately where the Shares were
purchased or acquired out of both the capital and the profits of the Company;
by the total amount of the purchase price paid by the Company for the Shares cancelled.
The Company cannot exercise any right in respect of Treasury Shares. In particular, the Company cannot
exercise any right to attend or vote at meetings and for the purposes of the Act, the Company shall be treated
as having no right to vote and the Treasury Shares will be treated as having no voting rights.
2. The financial effects on the Company and the Group arising from the proposed purchases of the Company’s Shares
which may be made pursuant to the proposed Shares Purchase Mandate will depend on, inter alia, the aggregate
number of Shares purchased and the consideration paid at the relevant time.
3. Based on the existing issued and paid-up share capital of the Company as at 23 March 2009 (the “Latest Practicable
Date”), the proposed purchases by the Company of up to a maximum of ten per cent. (10%) of its issued share capital
under the Shares Purchase Mandate will result in the purchase of 52,531,836 Shares.
4. An illustration of the impact of Shares purchases by the Company pursuant to the Shares Purchase Mandate on the
Group’s and the Company’s financial position is set out below based on the following assumptions:
(a) audited accounts of the Group and the Company as at 31 December 2008;
(b) in full exercise of the Shares Purchase Mandate, 525,318,360 Shares were purchased;
(c) the maximum price for the market purchases is $1.5603, which is five per cent. (5%) above the average closing
prices of the Shares over the last five market days preceding the Latest Practicable Date on which the transactions
in Shares were recorded on the SGX-ST; and
(d) the maximum amount of funds required for the Shares purchases in the aggregate is $ 81,965,424.
Market Purchases and Off-Market Purchases and held as Treasury Shares or cancelled
Company Company
Group before Group after before after
Shares Shares Shares Shares
purchase purchase purchase purchase
($’000) ($’000) ($’000) ($’000)
Shareholders’ funds 297,547 215,582 174,205 92,240
Net assets value 297,547 215,582 174,205 92,240
Current assets 384,167 302,202 380,319 298,354
Current liabilities 324,504 324,504 168,406 168,406
Cash and cash equivalents 90,740 8,775 18,242 (63,723)
Number of shares (‘000) 525,271 472,739 525,271 472,739
Financial Ratios
Net assets value per Share (cents) 56.65 45.60 33.16 19.51
Earnings per Share (cents) 11.25 12.50 3.97 4.41
Gearing (%) 0.56 1.16 1.36 3.46
Current ratio 1.18 0.93 2.26 1.77
5. Shareholders should note that the financial effects set out above are based on the audited financial accounts
of the Group and the Company for the financial year ended 31 December 2008 and are for illustration only. The
results of the Group and the Company for the financial year ended 31 December 2008 may not be representative
of future performance.
6. The Company intends to use its internal sources of funds to finance its purchases of the Shares. The Company does
not intend to obtain or incur any borrowings to finance its purchases of the Shares. The Directors do not propose to
exercise the Shares Purchase Mandate in a manner and to such extent that the working capital requirements of the
Group would be materially affected.
7. The Company will take into account both financial and non-financial factors, among other things, the market
conditions at such time, the Company’s financial condition, the performance of the Shares and whether such Shares
purchases would represent the most efficient and cost-effective approach to enhance the Share value. Shares
purchases will only be made if the Board believes that such purchases are likely to benefit the Company and increase
economic value for shareholders.
(E) Consequences of Shares Purchases Under The Singapore Code on Take-overs and Mergers
1. In accordance with The Singapore Code on Take-overs and Mergers (the “Take-over Code”), a person will be required
to make a general offer for a public company if:
(a) he acquires 30 per cent. (30%) or more of the voting rights of the company; or
(b) he already holds between 30 per cent. (30%) and 50 per cent. (50%) of the voting rights of the company, and
he increases his voting rights in the company by more than one per cent. (1%) in any six-month period.
2. As at the Latest Practicable Date and before the proposed Shares Purchase Mandate, the substantial shareholders’
and Directors’ interests are as follows:
Direct Interest Deemed Interest Total Interest

Number Number Number
Directors of Shares % of Shares % of Shares %
Olivia Lum 167,484,141 31.88 10,000,000 1.90 177,484,141 33.78

Teo Kiang Kok – – – – – –
Lee Joo Hai – – – – – –
Gay Chee Cheong 450,000 0.08 – – 450,000 0.08
Christopher Murugasu 469,375 0.09 120,000 ¹ 0.02 589,375 0.11
Professor Tan Teck Meng 10,000 0.002 51,000 0.01 61,000 0.012
Raj Mitta – – – – – –
Ahmed Butti Ahmed – – – – – –
NOTES:
1 Christopher Murugasu is deemed interested in the Shares held by his spouse, Bernadette Oei L ian Hua.
In the event the Company undertakes Shares purchases of up to ten per cent. (10%) of the issued share capital of
the Company as permitted by the Shares Purchase Mandate, the shareholdings and voting rights of Ms Olivia Lum
may be increased from 33.78% to 37.62%. Ms Olivia Lum’s shareholdings and voting rights may thus be increased
by more than one per cent (1%) within a 6-month period. Accordingly, Ms Olivia Lum may be required to make a
general offer to the other Shareholders under Rule 14.1(b) of the Take-over Code.
3. The Securities Industry Council has granted approval in-principle to exempt Ms Olivia Lum from the requirement
to make a general offer under Rule 14.1(b) of the Take-over Code after any Shares purchase subject to the
following conditions:
(a) the Circular contains advice to the effect that by voting for the Shares Purchase Mandate, Shareholders are
waiving their rights to a general offer at the required price from Ms Olivia Lum and parties acting in concert
with her, if any; the names of Ms Olivia Lum and her concert parties, if any, and the voting rights of such persons
at the time of resolution and after the proposed Shares Purchases are disclosed in the Circular;
(b) the resolution to authorise the Shares Purchase Mandate is approved by a majority of those Shareholders
present and voting at the meeting on a poll who could not become obliged to make an offer for the Company
as a result of the Shares Purchase;
(c) Ms Olivia Lum and her concert parties, if any, do not vote for and/or recommend Shareholders to vote in favour
of the resolution to approve the Shares Purchase Mandate; and
(d) Ms Olivia Lum and her concert parties, if any, have not acquired and will not acquire any Shares between the
date on which they know that the announcement of the approval of the Shares Purchase Mandate is imminent
and the earlier of:
(i) the date on which the Shares Purchase Mandate expires; and
(ii) the date the Company announces that it has bought back such number of Shares as authorised under
the Shares Purchase Mandate approved at the latest annual general meeting or the date the Company
decides to cease buying back its Shares, as the case may be,
if such acquisitions, taken together with shares bought by the Company under the Shares Purchase Mandate, would
cause their aggregate voting rights in the Company to increase by more than 1% in the any 6–month period.
If the Company ceases to buy back its Shares and the increase in the voting rights held by Ms Olivia Lum and her
concert parties, if any, as a result of the Company purchasing Shares at the time of such cessation is less than 1% in any
6-month period, Ms Olivia Lum and her concert parties, if any, will be allowed to acquire Shares. However, any increase
in Ms Olivia Lum and her concert parties’ percentage voting rights as a result of the Company’s repurchase of its Shares
will be taken into account together with any Company Shares acquired by Ms Olivia Lum and her concert parties, if
any, (by whatever means) in determining whether Ms Olivia Lum and her concert parties, if any, have increased their
aggregate voting rights in the Company by more than 1% in any 6-month period.
The Directors hereby confirm that the Substantial Shareholders are not acting in concert with any other person to
assist any Shareholder (or his concert party or parties) to obtain or consolidate control of the Company and that the
proposed Shares Purchases are not for any such purpose.
It should be noted that approving the Shares Purchase Mandate will constitute a waiver by the Shareholders
in respect of their right to a general offer by the Substantial Shareholders at the Required Price.
(F) Miscellaneous
1. Any Shares purchases undertaken by the Company shall be at a price of up to but not exceeding the Maximum
Price. The Maximum Price is a sum which shall not exceed the sum constituting five per cent. (5%) above the
average closing price of the Shares over the period of five (5) trading days in which transactions in the Shares on
the SGX-ST were recorded, in the case of a Market Purchase, before the day on which such purchase is made, and, in
the case of an Off-Market Purchase, immediately preceding the date of offer by the Company, as the case may be,
and adjusted for any corporate action that occurs after the relevant five (5) day period.
2. In making Share purchases, the Company will comply with the requirements of the SGX-ST Listing Manual,
in particular, Rule 886 with respect to notification to the SGX-ST of any Shares purchases. Rule 886 is
reproduced below:
“(1) An issuer must notify the Exchange of any share buy-back as follows:
(a) In the case of a market acquisition, by 9.00 am on the market day following the day on which it purchased
shares,
(b) In the case of an off market acquisition under an equal access scheme, by 9.00 am on the second market
day after the close of acceptances of the offer.
(2) Notification must be in the form of Appendix 8.3.1 (or 8.3.2 for an issuer with a dual listing on another
stock exchange).”
3. Shares purchases will be made in accordance with the “Guidelines on Shares Purchases” as set out in Appendix I of the
Company’s Circular to Shareholders dated 4 April 2008, a copy of which is annexed. All information required under
the Act relating to the Shares Purchase Mandate is contained in the said Guidelines.
4. The SGX-ST Listing Manual does not expressly prohibit any purchase of shares by a listed company during any
particular time or times. However, as a listed company would be considered an “insider” in relation to any proposed
purchase or acquisition of its shares, the Company will undertake not to purchase or acquire Shares pursuant to the
proposed Share Purchase Mandate at any time after a price sensitive development has occurred or has been the
subject of a decision until the price sensitive information has been publicly announced. In particular, the Company
will not purchase or acquire any Shares during the period commencing one month immediately preceding the
announcement of the Company’s full-year and half year results and the period of two weeks immediately preceding
the announcement of its quarterly results.
(G) Directors’ Responsibility Statement
The Directors of the Company collectively and individually accept full responsibility for the accuracy of the information
given herein and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, the
facts stated in this Appendix are accurate and that there are no material facts the omission of which would make any
statement in this Appendix misleading.
(H) Shareholders Who Will Abstain From Voting
Ms Olivia Lum and her concert parties will abstain from voting at the Annual General Meeting in respect of Ordinary
Resolution 9 relating to the Shares Purchase Mandate.
(I) Directors’ Recommendation
The Directors of the Company, other than Ms Olivia Lum who has abstained from making any recommendation, are
of the opinion that the renewal of the proposed Shares Purchase Mandate is in the best interests of the Company.
Accordingly, the Directors of the Company recommend that shareholders vote in favour of Ordinary Resolution No. 9.
(J) Taxation
Shareholders who are in doubt as to their respective tax positions or any tax implications, or who may be subject to
tax in a jurisdiction outside Singapore, should consult their own professional tax advisers.
(K) Documents For Inspection
Copies of the following documents may be inspected at the registered office of the Company at 202 Kallang
Bahru, Hyflux Building, Singapore 339339 during normal business hours up to and including the date of the Annual
General Meeting:
(a) the Memorandum and Articles of Association of the Company; and
(b) the audited financial statements of the Company for the financial year ended 31 December 2008.
Appendix 2
GUIDELINES ON SHARES PURCHASES
1. Shareholders’ Approval
(a) Purchases of Shares by the Company must be approved in advance by the Shareholders at a general meeting
of the Company, by way of a general mandate.
(b) A general mandate authorising the purchase of Shares by the Company representing up to ten per cent. (10%)
of the issued ordinary shares in the capital of the Company (excluding any Shares held as Treasury Shares) will
expire on the earlier of:
(i) the conclusion of the next annual general meeting of the Company;
(ii) the expiration of the period within which the next annual general meeting of the Company is required by
law to be held; or
(iii) the time when such mandate is revoked or varied by an ordinary resolution of the Shareholders of the
Company in general meeting.
(c) The authority conferred on the Directors by the Shares Purchase Mandate to purchase Shares shall be renewed
at the next annual general meeting of the Company.
(d) When seeking Shareholders’ approval for the renewal of the Shares Purchase Mandate, the Company shall
disclose details pertaining to the purchases of Shares made during the previous 12 months, including the total
number of Shares purchased, the purchase price per Share or the highest and lowest price for such purchases
of Shares, where relevant, and the total consideration paid for such purchases.
2. Mode Of Purchase
Shares Purchases can be effected by the Company in either one of the following two ways or both:
(a) by way of market purchases of Shares on the Official List of SGX-ST, which means a purchase transacted through
the Central Limit Order Book trading system; or
(b) by way of off-market acquisitions on an equal access scheme in accordance with Section 76C of the Act.
3. Funding Of Shares Purchases
(a) In purchasing the Shares, the Company may only apply funds legally permitted for such purchase in accordance
with its Articles of Association, and the relevant laws and regulations enacted or prescribed by the relevant
competent authorities in Singapore.
(b) Any purchase by the Company may be made out of capital or profits that are available for distribution as
dividends, so long as the Company is solvent (as defined by Section 76F(4) of the Act) .
(c) The Company may not purchase its Shares on the Official List of SGX-ST for a consideration other than cash or
for settlement otherwise than in accordance with the trading rules of the SGX-ST.
4. Trading Restrictions
The number of Shares which can be purchased pursuant to the Shares Purchase Mandate is such number of Shares
which represents up to a maximum of ten per cent. (10%) of the issued ordinary shares in the capital of the Company
(excluding Treasury Shares) as at date of the last annual general meeting of the Company.
5. Price Restrictions
Any Shares Purchase undertaken by the Company shall be at the price of up to but not exceeding the Maximum Price.
“Maximum Price” means the maximum price at which the Shares can be purchased pursuant to the Shares Purchase
Mandate, which shall not exceed the sum constituting five per cent. (5%) above the average closing price of the Shares
over the period of five (5) trading days in which transactions in the Shares on the SGX-ST were recorded, in the case
of a Market Purchase, before the day on which such purchase is made, and, in the case of an Off-Market Purchase,
immediately preceding the date of offer by the Company, as the case may be, and adjusted for any corporate action that
occurs after the relevant five (5) day period.
6. Off-Market Purchases
(a) For purchases of Shares made by way of an Off-Market Purchase, the Company shall issue an offer document
to all Shareholders. The offer document shall contain, inter alia, the following information:
(i) the terms and conditions of the offer;
(ii) the period and procedures for acceptances;
(iii) the reasons for the proposed Shares Purchase;
(iv) the consequences, if any, of Shares purchase by the Company that will arise under the Singapore Code on
Take-overs and Mergers or any other applicable take-over rules;
(v) whether the purchase of Shares, if made, would have any effect on the listing of the Company’s securities
on the Official List of SGX-ST; and
(vi) details of any purchase of Shares made by the Company in the previous 12 months whether through
Market Purchases or Off-Market Purchases, including the total number of Shares purchased, the purchase
price per Share or the highest and lowest prices paid for such purchases of Shares, where relevant, and the
total consideration paid for such purchases.
(b) All Offeree Shareholders shall be given a reasonable opportunity to accept any offer made by the Company to
purchase their Shares under the Shares Purchase Mandate.
(c) The Company may offer to purchase Shares from time to time under the Shares Purchase Mandate subject to
the requirement that the terms of any offer to purchase Shares by the Company shall be pari passu in respect
of all Offeree Shareholders save under the following circumstances:
(i) where there are differences in consideration attributable to the fact that an offer relate to Shares with
different dividend entitlements;
(ii) where there are differences in consideration attributable to the fact that an offer relate to Shares with
different amounts remaining unpaid; and
(iii) where there are differences in an offer introduced solely to ensure that every Shareholder is left with a
whole number of Shares in board lots of 1,000 Shares after the Shares Purchases, in the event there are
Offeree Shareholders holding odd numbers of Shares.
7. Status Of Purchased Shares
The purchased Shares shall be cancelled immediately on purchase or acquisition unless held in treasury in
accordance with Section 76H of the Act. Section 76H of the Act allows purchased Shares to be:
(i) held by the Company; or
(ii) dealt with, at any time, in accordance with Section 76K of the Act, as Treasury Shares.
Section 76K of the Act allows the Company to:
(i) sell the Shares (or any of them) for cash;
(ii) transfer the Shares (or any of them) for the purposes of or pursuant to an employees’ share scheme;
(iii) transfer the Shares (or any of them) as consideration for the acquisition of shares in or assets of another company
or assets of a person; or
(iv) cancel the Shares (or any of them).
The aggregate number of Shares held as Treasury Shares shall not at any time exceed ten per cent. (10%) of the total
number of Shares at that time. Any Shares in excess of this limit shall be disposed of or cancelled in accordance with
Section 76K of the Act within six (6) months.
Any Shares Purchase will:
(i) reduce the amount of the issued shares in the capital of the Company where the Shares were purchased or
acquired out of the capital of the Company;
(ii) reduce the amount of the Company’s profits where the Shares were purchased or acquired out of the profits
of the Company; or
(iii) reduce the amount of the Company’s share capital and profits proportionately where the Shares were
purchased or acquired out of both the capital and the profits of the Company;
by the total amount of the purchase price paid by the Company for the Shares cancelled.
The Company cannot exercise any right in respect of Treasury Shares. In particular, the Company cannot exercise
any right to attend or vote at meetings and for the purposes of the Act, the Company shall be treated as having no
right to vote and the Treasury Shares will be treated as having no voting rights.
8. Notification To Accounting and Corporate Regulatory Authority (“ACRA”)
(a) Within thirty (30) days of the passing of a Shareholders’ resolution to approve any purchase of Shares, the
Company shall lodge a copy of such resolution with ACRA.
(b) The Company shall notify ACRA within thirty (30) days of a purchase of Shares. Such notification shall include
details of the date of the purchase, the total number and nominal value of Shares purchased by the Company,
the issued shares in the capital of the Company as at the date of the Shareholders’ resolution approving the
purchase, the Company’s issued shares in the capital after the purchase and the amount of consideration paid
by the Company for the purchase.
9. Notification To The SGX-ST
(a) For purchases of Shares made by way of an Off-Market Purchase, the Company shall notify the SGX-ST in respect
of any acquisition or purchase of Shares in the relevant form prescribed by the SGX-ST from time to time, not
later than 9.00 a.m. on the second trading day after the close of acceptances of an offer, or within such time
period that may be prescribed by the SGX-ST from time to time.
(b) For purchases of Shares made by way of a Market Purchase, the Company shall notify the SGX-ST in respect of
any acquisition or purchase of Shares in the relevant form prescribed by the SGX-ST from time to time, not later
than 9.00 a.m. on the trading day following the date of market acquisition by the Company, or within such time
period that may be prescribed by the SGX-ST from time to time.
10. Suspension Of Purchase
(a) The Company may not undertake any Shares Purchase prior to the announcement of any price-sensitive
information by the Company, until such time as the price sensitive information has been publicly announced or
disseminated in accordance with the requirements of the Listing Manual.
(b) The Company may not effect any repurchases of Shares on the SGX-ST during the period commencing two
weeks before the announcement of the Company’s financial statements for each of the first three quarters of
its financial year, or one month before half year or financial year, as the case may be, and ending on the date of
announcement of the relevant results.
Notice of Books Closure
NOTICE IS HEREBY GIVEN that the Share Transfer Books and Register of Members of Hyflux Ltd (“Company”) will be
closed at 5.00 p.m. on 8 May 2009 for the preparation of dividend warrants.
Duly completed registrable transfers received by the Company’s Share Registrar, Boardroom Corporate & Advisory Services
Pte. Ltd., 3 Church Street #08-01 Samsung Hub, Singapore 049483 up to 5..00 p.m. on 8 May 2009 will be registered
to determine shareholders’ entitlements to the said dividend. Members whose Securities Accounts with The Central
Depository (Pte) Limited are credited with shares at 5.00 p.m. on 8 May 2009 will be entitled to the proposed dividend.
Payment of the dividend, if approved by the members at the Annual General Meeting to be held on 28 April 2009, will
be made on 22 May 2009.
HYFLUX LTD IMPORTANT:
Company Registration No. 200002722Z 1. For investors who have used their CPF monies to buy Hyflux Ltd’s shares, this Report
(Incorporated in the Republic of Singapore with limited liability) is forwarded to them at the request of the CPF Approved Nominees and is sent solely
FOR INFORMATION ONLY.
2. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all
intents and purposes if used or purported to be used by them.
3. CPF investors who wish to attend the Meeting as an observer must submit their requests
through their CPF Approved Nominees within the time frame specified. If they also
PROXY FORM wish to vote, they must submit their voting instructions to the CPF Approved Nominees
within the time frame specified to enable them to vote on their behalf.
(Please see notes overleaf before completing this Form)
I/We (Name & NRIC No.)
of (Address)
being a member/members of Hyflux Ltd (“Company”), hereby appoint:
Name NRIC/Passport No. Proportion of Shareholdings

No. of Shares %
Address
and/or (delete as appropriate)
Name NRIC/Passport No. Proportion of Shareholdings

No. of Shares %
Address
or failing the person, or either or both of the persons, referred to above , the Chairman of the Meeting as my/our proxy/proxies to vote for
me/us on my/our behalf at the Annual General Meeting (the “Meeting”) of the Company to be held on 28 April 2009 at 2.00 p.m. and at any
adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the Meeting as indicated hereunder.
If no specific direction as to voting is given or in the event of any other matter arising at the Meeting and at any adjournment thereof, the
proxy/ proxies will vote or abstain from voting at his/her discretion. The authority herein includes the right to demand or to join in demanding
a poll and to vote on a poll.
To be used on a show of To be used in the event of

hands a poll
No. Resolutions
For * Against * No. of Votes No. of Votes
For ** Against **
Ordinary Business
1 Adoption of Directors’ Report and Audited Accounts
2 Declaration of Dividends
3 Re-election of Mr Teo Kiang Kok as Director
4 Re-election of Mr Christopher Murugasu as Director
5 Approval of Directors’ fees
6 Re-appointment of Auditors
Special Business
7 Authority to issue shares up to 50 per centum (50%) of the
issued shares in the capital of the Company
8 Authority to issue shares under Hyflux Employees’ Share
Option Scheme
9 Renewal of Share Purchase Mandate
* Please indicate your vote “For” or “Against”, with an “X” within the box provided.
** If you wish to exercise all your votes “For” or “Against”, please indicate with an “X” within the box provided. Alternatively, please indicate the
number of votes as appropriate.
Dated this day of 2009
Total number of
Signature of Shareholder(s) or, Common Seal of Corporate Shareholder Shares held
Notes :
1. Please insert the total number of Shares held by you. If you have Shares entered against your name in the Depository Register (as defined in
Section 130A of the Companies Act, Chapter 50 of Singapore), you should insert that number of Shares. If you only have Shares registered in
your name in the Register of Members, you should insert that number of Shares. However, If you have Shares entered against your name in the
Depository Register and Shares registered in your name in the Register of Members, you should insert the aggregate number of Shares entered
against your name in the Depository Register and registered in your name in the Register of Members. If no number is inserted, the instrument
appointing a proxy or proxies shall be deemed to relate to all the Shares held by you.
2. A Shareholder of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attend
and vote instead of him. A proxy need not to be a Shareholder of the Company. Where a Shareholder appoints two proxies, the proportion of
the shareholding concerned to be represented by each proxy shall be specified in the proxy form. If no percentage is specified, the first named
proxy shall be deemed to represent 100 per cent of the shareholding and the second named proxy shall be deemed to be an alternate to the
first named proxy.
3. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at 202 Kallang Bahru, Singapore
339339 not less than 48 hours before the time appointed for the Meeting.
fold along this line(1)
Affix
Postage
Stamp
The Company Secretary

Hyflux LTD
Hyflux Building
202 Kallang Bahru
Singapore 339339
fold along this line(2)
4. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing. Where the
instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its seal or under the hand of an officer
or attorney duly authorised. Where an instrument appointing a proxy is signed on behalf of the appointor by an attorney, the letter or power of
attorney or a duly certified copy thereof must (falling previous registration with the Company) be lodged with the instrument of proxy, falling
which the instrument may be treated as invalid.
5. A corporation which is a Shareholder may authorise, by resolution of its directors or other governing body, such person as it thinks fit to act as
its representative at the Annual General Meeting, in accordance with Section 179 of the Companies Act, Chapter 50 of Singapore.
6. The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible or
where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing
a proxy or proxies. In addition, in the case of Shareholders whose Shares are entered in the Depository Register, the Company may reject
any instrument appointing a proxy or proxies lodged if such Shareholders are not shown to have Shares entered against their name in the
Depository Register 48 hours before the time appointed for holding the Annual General Meeting, as certified by The Central Depository (Pte)
Limited to the Company.
7. Completion and return of this instrument appointing a proxy shall preclude a member from attending and voting at the Meeting. Any
appointment of a proxy or proxies shall be deemed to be revoked if a member attends the meeting in person, and in such event, the Company
reserves the right to refuse to admit any person or persons appointed under the instrument of proxy to the Meeting.
“This page has been left intentionally blank”
Hyflux Group of Companies
Singapore • Hyflux NewSpring (Leping) Co., Ltd British Virgin Islands

• Eflux Philippines Pte Ltd • Hyflux NewSpring • Hyflux Advanced Technology Ltd
• Eflux Singapore Pte Ltd (LiaoYangGongChangLing) Co., Ltd • Hyflux International Ltd
• Eflux SK Pte Ltd • Hyflux NewSpring (Nantong) WT Co., Ltd • Hyflux Water Projects Ltd
• Eflux Vietnam Pte Ltd • Hyflux NewSpring (Taoyuan) Co., Ltd • IndoSpring Utility Ltd
• Energy Life Pte Ltd • Hyflux NewSpring Construction • SinoSpring Utility Ltd
• Hydrochem (S) Pte Ltd Engineering (Shanghai) Co., Ltd • Spring China Utility Ltd
• Hydrochem Engineering (S) Pte Ltd • Hyflux NewSpring Sewage Disposal • Spring Environment Ltd
• Hyflux Aquosus (Singapore) Pte Ltd (Jiawang) Co., Ltd • Spring Utility Ltd
• Hyflux Asset Management Pte Ltd • Hyflux NewSpring Waste Water
• Hyflux Capital (Singapore) Pte Ltd Treatment (Funing) Co., Ltd Europe
• Hyflux Consumer Products Pte Ltd • Hyflux NewSpring Waste Water France
• Hyflux Engineering Pte Ltd Treatment (Guanyun) Co., Ltd • Tlemcen Desalination Investment
• Hyflux EPC Pte Ltd • Hyflux NewSpring Waste Water Company
• Hyflux Filtech (Singapore) Pte Ltd Treatment (LePing) Co., Ltd
Netherlands
• Hyflux Filtration (S) Pte Ltd • Hyflux NewSpring Waste Water
• Hyflux Ceparation B.V.
• Hyflux International Engineering Treatment (Rudong) Co., Ltd
• Hyflux Ceparation Technologies B.V.
Pte Ltd • Hyflux NewSpring Water Treatment
• Hyflux IP Resources Pte Ltd (Linyi) Co., Ltd Netherlands Antilles
• Hyflux Lifestyle Products (S) Pte Ltd • Hyflux NewSpring Water Treatment • Hyflux Ceparation N.V.
• Hyflux Management And Consultancy (Minguang) Co., Ltd
Pte Ltd • Hyflux Salt Industry Technology India
• Hyflux Marmon Development Pte Ltd Development (Tianjin) Co., Ltd • Ahmedabad Recycled Water Company
• Hyflux Membrane Manufacturing (S) • Hyflux Unitech (Shanghai) Co., Ltd Private Limited
Pte Ltd • Kunshan Eco Water Systems Co., Ltd • Eflux Oil India Private Limited
• Hyflux SIP Pte Ltd • NewSpring Huludao Co., Ltd • Hyflux Engineering (India) Private Limited
• Hyflux Utility (India) Pte Ltd • Ningxia Hypow Bio-technology Co., Ltd • Hyflux Lifestyle Products (India) Private
• Hyflux Water Trust Management • Sinolac (Huludao) Biotech Co., Ltd Limited
Pte Ltd • Taizhou Kairunda Used Oil Collection
• IndoSpring Utility (S) Pte Ltd Co., Ltd Malaysia
• Marmon Hyflux Investments Pte Ltd • Tianjin Dagang NewSpring Desalination • Hyflux Malaysia Sdn Bhd
• MenaSpring Utility (S) Pte Ltd Co., Ltd
• NewSpring Utility Pte Ltd MENA
• Sinolac (Singapore) Pte Ltd Hong Kong Saudi Arabia
• Hyflux Utility (DF) Limited • Lube Oil Re-refining Company
China • Hyflux Utility (HLD) Limited
• Beijing Shouren Water Engineering • Hyflux Utility (LP) Limited United Arab Emirates
& Technology • Hyflux Utility (PJ) Limited • Hyflux (Middle East) FZCO
• Eflux (Taizhou) Co., Ltd • Hyflux Utility (TJ) Limited • Palm Water LLC
• Hydrochem Engineering (Shanghai) • Hyflux Utility (TY) Limited Algeria
Co., Ltd • Hyflux Utility (YK) Limited • Almiyah Attilemcania SPA
• Hyflux Design Engineering (Shanghai) • Hyflux Utility (YL) Limited • Hyflux – TJSB Algeria
Co., Ltd • Hyflux Utility Water Limited • Hyflux Engineering Algeria
• Hyflux Engineering (Shanghai) Co., Ltd • Hyflux Utility WT (CGL) Limited • Hyflux Operations & Maintenance Algeria
• Hyflux Filtech (Shanghai) Co., Ltd • Hyflux Utility WT (LY) Limited • Tahlyat Myah Magtaa SPA
• Hyflux Hi-tech Product (Yangzhou) • Hyflux Utility WT (MG) Limited
Co., Ltd • Hyflux Utility WT (XC) Limited Vietnam
• Hyflux Investment Management & • Hyflux Utility WT (YKG) Limited • Eflux Success Blossom Company Ltd
Consultancy (Tianjin) Co., Ltd • Hyflux Utility WT (YL) Limited
• Hyflux NewSpring (Dafeng North) • Hyflux Utility WWT (GY) Limited Cayman Islands
Co., Ltd • Hyflux Utility WWT (XC) Limited • Hyflux Asset Investment (CWF) Ltd
• Hyflux NewSpring (Dezhou) Co., Ltd • Hyflux Utility WWT (YKG) Limited • Hyflux Asset Management (CWF) Ltd
• Hyflux NewSpring (Funing) Co., Ltd • Hyflux Utility WWT (YL) Limited
• Hyflux NewSpring (Jiawang) Co., Ltd • Hyflux Utility WWT (YT) Limited
• Hyflux Utility WWTP (GY) Limited
Corporate Information
Audit Committee Auditors Deutsche Bank AG, Singapore Branch

Lee Joo Hai (Chairman) KPMG LLP One Raffles Quay
#16-00 South Tower
Teo Kiang Kok 16 Raffles Quay #22-00
Singapore 048583
Gay Chee Cheong Hong Leong Building
Professor Tan Teck Meng Singapore 048581 Hua Nan Commercial Bank, Ltd.,
Singapore Branch
Nominating Committee Partner-in-Charge (since 2008): 80 Robinson Road, #14-03
Gay Chee Cheong (Chairman) Tham Sai Choy Singapore 068898
Lee Joo Hai
Teo Kiang Kok Bankers Land Bank of Taiwan, Singapore Branch
80 Raffles Place
Arab Bank Plc
Remuneration Committee 80 Raffles Place
#34-01 UOB Plaza 1
Singapore 048624
Professor Tan Teck Meng (Chairman) #32-20 UOB Plaza 2
Gay Chee Cheong Singapore 048624 Mega International Commercial Bank Co.,
Teo Kiang Kok Ltd. (ex-ICBC), Singapore Branch
Lee Joo Hai Arab Banking Corporation (B.S.C.)
80 Raffles Place
Christopher Murugasu 9 Raffles Place
#23-20 UOB Plaza II
#60-03 Republic Plaza
Singapore 048624
Risk Management Committee Singapore 048619
Raj Mitta (Chairman) Bangkok Bank Public Company Limited Mizuho Corporate Bank, Ltd., Singapore
Christopher Murugasu 180 Cecil Street Branch
Lee Joo Hai Bangkok Bank Building 168 Robinson Road
Teo Kiang Kok Singapore 069546 Capital Towers #13-00
Singapore 068912
Executive Committee Bank of China
4 Battery Road Natixis, Singapore Branch
Olivia Lum (Chairman) 50 Raffles Place
Lee Joo Hai Bank of China Building
Singapore 049908 #41-01 Singapore Land Tower
Teo Kiang Kok Singapore 048623
Gay Chee Cheong Bank of Taiwan, Singapore Branch
80 Raffles Place Oversea-Chinese Banking Corporation
Management Committee #28-20 UOB Plaza 2 Limited
for financial year ending Singapore 048624 65 Chulia Street
31 December 2009: OCBC Centre
BNP Paribas, Singapore branch Singapore 049513
Olivia Lum
20 Collyer Quay
Sam Ong Rabobank International,
Tung Centre
Cho Wee Peng Singapore Branch
Singapore 049319
Fong Chun Hoe 77 Robinson Road
Foo Hee Kiang Calyon, Singapore Branch #09-00 SIA Building
Winnifred Heap 168 Robinson Road Singapore 068896
Lee Soon Eng #22-01 Capital Tower
Singapore 068912 Standard Chartered Bank
Company Secretary 6 Battery Road, Level 23
Lim Poh Fong Chang Hwa Commercial Bank Ltd, Singapore 049909
Singapore Branch
No.1 Finlayson Green, #08-00 State Bank of India
Registered Office 6 Shenton Way
Singapore 049246
Hyflux Building #22-08 DBS Building Tower 2
202 Kallang Bahru CIMB Bank Berhad (ex-Bumiputra- Singapore 068809
Singapore 339339 Commercial Bank ), Singapore Branch
Tel : +65 6214 0777 50 Raffles Place The Bank of East Asia Limited,
Fax : +65 6214 1211 #09-01 Singapore Land Tower Singapore Branch
Singapore 048623 137 Market Street
Share Registrar and Share BEA Building
Transfer Office DBS Bank Ltd Singapore 048943
6 Shenton Way
Boardroom Corporate & Advisory United Overseas Bank Limited
DBS Building Tower One
Services Pte Ltd Singapore 068809 1 Raffles Place
3 Church Street OUB Centre
#08-01 Samsung Hub Singapore 048616
Singapore 049483
W W W. HYF LU X . CO M
TM
Hyflux Building
202 Kallang Bahru
Singapore 339339
HYFLUX LTD
Company Registration No. 200002722Z
(Incorporated in the Republic of Singapore with limited liability)
9 April 2009
Dear Shareholder
Thank you for investing in Hyflux Ltd.
We are pleased to enclose a copy of our Annual Report for the financial year ended 31 December 2008.
Starting from this year, we will send our Annual Report in CD-ROM format. However, if you prefer to receive a hard copy
instead, please indicate your preference by completing the request form appended below.
Please mail, fax or e-mail us your completed form by 20 April 2009:
Hyflux Ltd
Corporate Communications
Hyflux Building, 202 Kallang Bahru
Singapore 339339
Fax: 6214 1211, E-mail: felicia_yoo@hyflux.com
Should you change your mind at a later stage, you can still e-mail us your preferred option. If we do not hear from you by the
indicated deadline, we will proceed to send you the report in a CD-ROM.
Please note that the Annual Report 2008 will also be available on the SGX website at www.sgx.com.
Yours faithfully
For and on Behalf of Hyflux Ltd
Lim Poh Fong

Company Secretary
REQUEST FORM
To: HYFLUX LTD
Please tick only one box. Incomplete or incorrectly completed forms will not be processed.
I/We wish to receive a hard copy of the Annual Report 2008.
(1)
I/We wish to receive both versions of Annual Report (hard copy and CD-ROM) for future financial years for as
long as I am/we are a shareholder(s) of Hyflux Ltd.
Name(s) of Shareholder(s): ___________________________________ NRIC/Passport Number(s): _________________

The shares are held by me under or through:
CDP Securities Account Number 1 6 8 1 - -
CPFIS Account
Physical Scrips
Address: ___________________________________________________________ Postal Code: ___________________
E-mail address: _____________________________________________________
Signature(s): ________________________________________________________ Date: _________________________

(1)
Please note that this option is not available if your shares are deposited in a CPFIS Account.

Ar 2008

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Cover Photo by Olivia Lum

Photo by Olivia Lum

Olivia Lum, Group CEO, President and Managing Director

Message from Group CEO, President and Managing Director (cont’d)

“Hyflux will continue to focus on project execution, quality

Message from Group CEO, President and Managing Director (cont’d)

(L-R): Olivia Lum, Group CEO,

Divider Photo: Yoong Kang Chee

Growing Geographical Presence

No. 1517-1519 Namibia

Middle East and North Africa (“MENA”)*

1,000 plants in over

Growing Geographical Presence (cont’d)

Indonesia THE NETHERLANDS OFFICE

This map is not to scale

China* Southeast Asia*

Group Financial Highlights & Review

Key Financial Data

Revenue 88,655 131,504 142,379 192,786 554,224

Shareholders’ Equity 112,647 189,563 199,601 239,772 297,547

Return on Revenue (%) 29.4% 35.3% 10.9% 17.1% 10.7%

* Net Asset Value excludes Minority Interests

Group Revenue by Country & Region

Singapore and Others

All figures are quoted in Singapore Dollars

Group Financial Highlights & Review (cont’d)

(For year ended 31 December)

Net Asset Value Per Share 27 times

Group Financial Highlights & Review (cont’d)

Group Revenue Financial Review

6% Revenue 554.2 192.8 +187%

2008 Overview In the MENA region, the Group is

Group Financial Highlights & Review (cont’d)

Costs and Expenses Non-current assets increased from Group Revenue

Finance expenses increased marginally Current liabilities increased from

Board of Directors (cont’d)

Heads of Strategic Business Units

Heads of Strategic Business Units (cont’d)

Our Hyflux Family Together with a closely-knit workforce around

Photo: Jolyn Sng

To meet the needs of our recurring Educational Qualifications

In addition, as part of our human 2008

Corporate Social Responsibility

We have laid strong foundations for these Corporate Social

Awards and Accolades

Awards and Accolades (cont’d)

SIAS Investors’ Choice Awards – Fastest Growing 50 – Fastest

Forbes Asia – Best Under A Billion Community

Hyflux was presented with the

20 Years in Review - Key Milestones

Key Corporate Developments

Initial Years A Strong Home Base

Project win: Singapore Jurong Bird Park

20 Years in Review - Key Milestones (cont’d)

Installation at Bedok NEWater Plant

20 Years in Review - Key Milestones (cont’d)

Expanding Into Regional Markets

(L-R): Hyflux Group CEO Olivia Lum

20 Years in Review - Key Milestones (cont’d)

Hyflux participated in the inaugural

Hyflux continuously strives to deliver testimonial solutions for the