Wah Seong Corporation Berhad Annual Report 2018

7 INVESTMENT IN SUBSIDIARIES (CONTINUED) Subsequent event On 4 January 2019, Wasco Engineering & Technology Inc. (“WETI”), an indirect 65% owned subsidiary of the Company, had at its Extraordinary General Meeting inter-alia, approved the special resolution to wind up WETI by way of Member’s Voluntary Winding Up and duly approved by the Financial Services Commission of British Virgin Islands. As a result, the Group no longer controls the subsidiary and as such it was not consolidated. Petro-Pipe (Sabah) Sdn. Bhd. (“PPS”), an indirect 60% owned subsidiary of the Company, had undertaken a renounceable rights issue exercise of 10,000,000 ordinary shares, which rank pari passu with existing ordinary shares except for entitlement as to dividend, rights, allotment and/or other distributions entitlement of which is declared prior to date of allotment of the renounceable rights share. It is offered at an issue price of RM2.00 to PPS’s two shareholders in proportion to their shareholdings, representing a capital injection of RM20,000,000. With renunciation by the minority shareholder, namely Sabah Energy Corporation Sdn. Bhd., the rights issue has been fully subscribed by its majority shareholder and immediate holding company, namely Asiana Emas Sdn. Bhd. On 28 February 2019, PPS has completed the exercise with an allotment of 10,000,000 ordinary shares, thus its issued and paid up capital has increased to 28,000,000 ordinary shares. Accordingly, PPS became an indirect 70% owned subsidiary of the Company. Non-controlling interests in subsidiaries The Group’s subsidiaries that have material non-controlling interests (“NCI”) are as follows: Wasco Petro- Other Mackenzie Coatings Pipe individually Industries Malaysia (Sabah) immaterial Sdn. Bhd. Sdn. Bhd. Sdn. Bhd. subsidiaries Total Group RM’000 RM’000 RM’000 RM’000 RM’000 2018 NCI percentage of ownership interest and voting interest 40% 30% 40% Carrying amount of NCI 11,141 72,375 (4,110) 1,712 81,118 Net profit/(loss) allocated to NCI 1,208 (7,500) (2,112) 3,469 (4,935) Summarised financial information before intra-group elimination As at 31 December Non-current assets 5,043 31,635 78,042 Current assets 94,316 262,065 14,481 Current liabilities (71,507) (52,450) (102,798) Net assets/(liabilities) 27,852 241,250 (10,275) Financial year ended 31 December Revenue 109,412 94,275 41,285 Net profit/(loss) 3,019 (24,999) (5,280) Cash flows (used in)/generated from operating activities (18,578) 113,680 24,829 Cash flows generated from/(used in) investing activities 8,096 (95,664) (1,001) Cash flows used in financing activities (3,668) (37,148) (24,445) Net change in cash and cash equivalents (14,150) (19,132) (617) Dividends paid/payable to NCI - 10,200 - NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2018 WAH SEONG CORPORATION BERHAD 126