Renaissance United : Annual Report 2023

ANNUAL REPORT

2023

CONTENTS

LETTER TO

SHAREHOLDERS

Dear Shareholders,

The financial performance of Renaissance United Limited (the "Company") together with its subsidiaries (the "Group") is tied to its three principal operating subsidiaries as follows:

• Capri Investments LLC ("Capri")

Capri Investments L.L.C., in which the Group holds a 100% equity interest, is engaged in property development of its Falling Water Project located in Pierce County, near the cities of Seattle and Tacoma in the State of Washington, USA.

As announced on 3 November 2020, Capri closed on a partial sale of the Falling Water Plat/Planned Development District ("PDD") to KBHPNW LLC ("KB"), a subsidiary of USA national home builder KB Home. The aggregate purchase price for that certain tract of real property known as "Tract C, Falling Water/PDD - Tracts" ("Tract C") within the Falling Water Plat/PDD is US$8,029,872 (Approx. S$10,978,441), with the initial payment of US$4,000,072 (Approx. S$5,468,898). Capri has received US$2,500,000 (Approx. S$3,342,500) in the two anniversary of closing payments leaving the balance payable by KB Home due as lots are sold to third party house buyers, anticipated to close over the next 12 months.

Capri continues to defend itself in Sawyer Falls Co., LLC's ("Sawyer Falls") claims with the trial currently scheduled for mid-December.

As announced on 19 August 2023, Capri filed a motion for discretionary review and stay of the preliminary injunction with the Washington State Supreme Court. The motion for stay will be considered by the Supreme Court Commissioner prior to consideration of the motion for discretionary review. The motion for discretionary review is currently set for consideration on the Supreme Court Deputy Commissioner's October 11, 2023, Motion Calendar.

Material updates on the legal proceedings involving Capri will continue to be announced via SGXNet.

During the year under review and as announced, on 3 July 2022, The Honorable Timothy Ashcraft ordered that all remaining claims brought by Mr. G. Patrick Healy be dismissed and to pay US$45,000 attorney's fees. As no appeal was filed, this concluded this piece of litigation which commenced in 2018.

As announced on 27 November 2022, the Company disclosed that the Washington State Court of Appeals issued their opinion and affirmed the Superior Court's grant of summary judgement in favour of Capri, affirmed the Superior's court's attorney fee award and in addition granted attorney fees to Capri for the appeal. Capri received US$127,871.59 from Renovatio, LLC in payment of said fees.

There are no remaining claims against Capri. On June 13, 2023, Capri and its parent company, RUL, filed an Amended Third-Party Complaint Against Mr. G. Patrick Healy and Westridge Development, LLC. Capri's claim for breach of fiduciary duties is the only remaining claim in this case. This claim is currently valued at no less than US$230,000 plus interest.

Capri together with its engineers, lawyers and consultants is in compliance of the Hearing Examiner's conditions and milestones as approved during the 4th Tri-Annual Review of the project on March 26, 2018 as required for extending the Falling Water Preliminary Plat. On 14 June 2023, the Hearing Examiner granted the twenty seventh year time extension.

LETTER TO

SHAREHOLDERS

• Hubei Zonglianhuan Energy Investment Management Inc. ("HZLH")

The Group's wholly-owned subsidiary Excellent Empire Limited, via its 100% owned subsidiary China Environmental Energy Protection Investment Limited ("CEEP"), holds 65% equity interest in HZLH. HZLH in turn holds a 100% equity interest in four companies supplying natural gas under 30-year exclusive contracts with the cities of Anlu, Dawu, Xiaochang, and Guangshui in Hubei Province, People's Republic of China ("PRC").

HZLH's turnover of S$60.4 million in FY23 was flat compared to S$60.6 million in FY22 with gas sales. However, higher upstream cost prices continue to impact profitability.

The Russia-Ukraine conflict has and continues to bring uncertainty to the global gas market. However, it appears China has benefitted from European countries reducing gas reliance on Russia. Furthermore, China has signed long-term supply contracts with Qatar notably in Chinese Yuan. Furthermore, investments in LNG receiving infrastructure and storage has come online relieving supply chain "bottle-necks".

These, together with increased domestic production will help to mitigate the winter shortages China has experienced in prior years. Although cleaner energy and clean energy investment such as wind, solar and hydro are gaining momentum, gas will remain a vital pillar of China's energy mix in the medium term.

Moving forward, HZLH will look to optimising operational efficiencies including new pipelines, upgrading meters and implement new safety and monitoring systems. HZLH will continue to lobby local price bureaus for efficient price revisions when faced with higher operating costs. On this topic, a wholesale reform of the role of price bureaus is under discussion, with expectations of a more market driven price mechanism being adopted.

• ESA Electronics Pte. Ltd. ("ESA")

The Company holds an 81.25% equity interest in ESA. ESA is a Singapore incorporated company engaged in the business of assembling and trading of semiconductor products, and providing consultancy services to the semiconductor industry. ESA also acts as agents and distributors of semi-conductorback-end equipment such as vision inspection systems and test systems.

The drop in turnover to S$13.8 million in FY23 from S$14.8 million in FY22, was due to softer sales to mainland China. This was partly due to the softer business environment in early 2023 when China lifted their zero covid strategy.

The market in China will remain a key focus for ESA in FY24. Despite pressure from the United States and its allies, China still remains committed to semi-conductorself-sufficiency.