ANCOM NYLEX BERHAD Operational and Financial Insights at 54th AGM

ANCOM NYLEX BERHAD DETAILED ANSWERS Questions raised by Minority Shareholders Watch Group 54th Annual General Meeting

OPERATIONAL AND FINANCIAL MATTERS MSWG Question Q1 Company s response For the agricultural chemicals division, the Group s products are primarily used in sugar cane, corn, wheat, cotton, pineapple plantations. About 30% of the Agricultural Chemicals division s revenue was contributed by the sugar cane related products. Palm oil would have about 20% and Timber preservative related products about 15%. and palm oil The recent higher sugar prices is attributable to the expected lower supply of sugar as a results of El Nino phenomenon. Affected areas are Southeast Asia, SouthAfrica and Indian continents. (i) For FY2023, what percentage of the revenue of the division is derived from sugar cane related chemicals? The division experienced lower demand for the above-mentioned regions but for the Brazil and US market we obtained higher demand for agrichemical products. agricultural (ii) Currently, experience demand for its agricultural chemicals as a result of escalated sugar price? does significantly the division stronger There is a compensating effect between American continents and the rest of the world, as such the impact is manageable.

OPERATIONAL AND FINANCIAL MATTERS MSWG Question Q2 Company s response The segmental revenue from the Agrichemicals Division increased by 18.7% from RM462.8 million FY2022 to RM549.3 FY2023. For FY2023, Shennong Group contributed revenue of RM31.2 million or 5.7% ofAgrichemical Division s revenue. in in The rest of the increase is mostly due to increase in both volume as well as Average Selling Prices (ASP) of the products. In FY2023, we have also benefitted from the strong demand from our existing customers for the agrichemical products. million (i) To what extent was the increase in revenue driven by the acquisition of Shennong Group, which made its maiden contribution to the Group in FY2023? We export to more than 40 countries worldwide and, in each country, we would appoint distributors. Generally, there are no frequent changes in the distributorship arrangements. (ii) Besides, improvement in FY2023 also driven by an increase in average selling prices and higher demand from existing customers? is the revenue (iii) Did the division acquire any major new customers in FY2023?

OPERATIONAL AND FINANCIAL MATTERS MSWG Question Q3 Company s response In response to question no.4 raised by MSWG at the 53rdAGM last year, the Board stated that the Group remained focused to bring down its debts at company level and added that the Group aimed to conserve cash and raise debts to garner for growth opportunity. The Group is pleased to have reduced the gearing ratios from 0.74x from beginning of the year to 0.44x for the close of the year. This is a healthy progress in reducing the Group s borrowing and increasing the cash balance in hand at the same time. The approval for share buyback is to allow Company to participate in the purchasing of the company s own shares when it is undervalued. Given that the Group had a net gearing position of 0.44x as of May 31, 2023, and did not have excess cash, why is the company seeking shareholders' approval proposed renewal of authority for share buyback mandates at this AGM? The Group will continue to always seek opportunities to maximize returns to the shareholders when the opportunity arises. for the In responding the question relating to dividend priority, the board recognizes the better Balance Sheet position at the close of the year and hence recommended a dividend of 1sen per share which was paid in the month of August this year to reward the shareholders. Should not the company prioritise higher dividend reinvestment rather buybacks? payments than and share The board wishes to continue to reward shareholders with Dividend going forward subject to the performance of the company results and market conditions.

OPERATIONAL AND FINANCIAL MATTERS Company s response MSWG Question Q4 During repurchased 3,464,300 of its shares at an average price of RM1.09 per share and resold 13,597,500 of its treasury shares with prices ranging from RM0.93 and RM1.25. FY2023, the Company We wish to highlight that the average price for the share purchase during the year was RM0.91 and not RM1.09. RM1.09 was the highest price purchased during the year. We apologize there is a typo error in note 22 of the annual report. The average price for the share of 13.6million units sold during the year was RM1.11. i) What is the average resale price for the reselling of the treasury shares during FY2023? On average basis, the Group sold the shares at RM0.20 higher than the purchase price of the shares transacted during the year. ii) What is the rationale for the Company to repurchase and resell the shares within a close range of share prices and within a short span of time? It may appear that the Company was trading its shares instead of buying back the shares on the belief that the Company is undervalued. We wisht to highlight that as at the close of the financial year, the average cost of treasury shares held is RM0.66 per share, which is way lower than current share price of RM1.18 to RM1.20 range base on average closing in the last one week.

OPERATIONAL AND FINANCIAL MATTERS MSWG Question Q5 Company s response Between 10 July 2023 and 20 July 2023, the Company resold 3,684,600 treasury shares at prices ranging from RM0.965 to RM0.99 per share. Subsequently on 29 August 2023, the Company resold 1,200,000 treasury shares at RM1.04 per share. In the following month, up to 16 October 2023, the Company bought back 2,137,300 shares at a price range of RM1.04 to RM1.23. Thank you for comments. The disposal of 5 million unit of treasury shares in the month of July and August were mainly for the purpose of raising working capital fund for bank borrowing repayment. Amount was RM6million then. The operating environment between July when the shares was sold and Sept/October when the shares was repurchased was very different, considering the needs of the company, general economic conditions and operating outlook. Why did the Company choose to resell its treasury shares and then soon after repurchase them at higher prices?. The comparison of treasury management without taking into accounts as mentioned above is grossly not appropriate. Share buyback is carried out when management believe that the share price is not reflective of its full potential value. Management will continue to monitor the need for share buyback from time to time, taking into consideration factors such as the company s share price, potential future profits and financial position.

SUSTAINABILITY AND CORPORATE GOVERNANCE MATTERS MSWG Question Q6 Company s response Practice 13.6 Malaysian Code on Corporate Governance Minutes of the general meeting should be circulated to shareholders no later than 30 business days after the general meeting. We thank MSWG in highlighting this matter. 2021 We have complied with the requirement to publish the minutes within the stipulated timeline. However, due to technical faults, the minutes of meetings was found to be removed from our website. We have re-uploaded the minutes and matter have been resolved. ANCOMNY response: Applied. The minutes of the AGM and the Key Matter Discussed will be published in the Company s www.ancomnylex.com not later thank 30 business days after the meeting. (Page 69 of Corporate Governance Report 2023) website at MSWG s http://www.ancomnylex.com/agm.php has published the minutes of meetings for 2018, 2019, 2020 and 2021, but it has yet to release the minutes for 2022 at the website. comment: The website