KKB ENGINEERING BHD — Interim / Quarterly Report 2026

May 20, 2026

KKB ENGINEERING BERHAD

(Company No : 26495 - D)

(Incorporated in Malaysia)

INTERIM FINANCIAL STATEMENTS FOR THE FIRST QUARTER ENDED 31 MARCH 2026

Unaudited Condensed Consolidated Statements of Profit or Loss and Other Comprehensive Income

	3 MONTHS ENDED		CUMULATIVE 3 MONTHS ENDED
	CURRENT QUARTER ENDED 31/03/2026 RM	COMPARATIVE QUARTER ENDED 31/03/2025 RM	CURRENT PERIOD ENDED 31/03/2026 RM	COMPARATIVE PERIOD ENDED 31/03/2025 RM
Revenue from contracts with customers	24,598,557	45,143,013	24,598,557	45,143,013
Cost of sales	(21,284,538)	(39,857,978)	(21,284,538)	(39,857,978)
Gross profit	3,314,019	5,285,035	3,314,019	5,285,035
Selling and distribution expenses	(44,231)	(138,238)	(44,231)	(138,238)
Administrative expenses	(9,483,147)	(9,720,439)	(9,483,147)	(9,720,439)
Other operating expenses	(794,587)	(593,847)	(794,587)	(593,847)
Other operating income	649,324	871,699	649,324	871,699
Operating loss	(6,358,622)	(4,295,790)	(6,358,622)	(4,295,790)
Finance costs	(264,612)	(1,688,080)	(264,612)	(1,688,080)
Finance income	288,812	410,863	288,812	410,863
Other income	1,324,730	1,347,649	1,324,730	1,347,649
Share of results of associates	238,988	(6,908)	238,988	(6,908)
Loss before tax	(4,770,704)	(4,232,266)	(4,770,704)	(4,232,266)
Income tax credit	1,028,319	1,097,374	1,028,319	1,097,374
Loss for the period	(3,742,385)	(3,134,892)	(3,742,385)	(3,134,892)
Other Comprehensive Income	-	-	-	-
Total Comprehensive Loss for the period	(3,742,385)	(3,134,892)	(3,742,385)	(3,134,892)
(Loss)/Profit for the period attributable to:
Equity holders of the parent	(4,603,241)	(1,361,374)	(4,603,241)	(1,361,374)
Non-controlling interests	860,856	(1,773,518)	860,856	(1,773,518)
	(3,742,385)	(3,134,892)	(3,742,385)	(3,134,892)
Total Comprehensive (Loss)/Income for the period attributable to:
Equity holders of the parent	(4,603,241)	(1,361,374)	(4,603,241)	(1,361,374)
Non-controlling interests	860,856	(1,773,518)	860,856	(1,773,518)
	(3,742,385)	(3,134,892)	(3,742,385)	(3,134,892)
Loss per share attributable to equity holders of the parent:
Basic, for loss for the period (sen)	(1.59)	(0.47)	(1.59)	(0.47)

Diluted, for loss for the period (sen) - Not Applicable

(These Condensed Consolidated Statements of Comprehensive Income should be read in conjunction with the accompanying explanatory notes attached to these interim financial statements.)

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KKB ENGINEERING BERHAD

(Company No : 26495 - D)

(Incorporated in Malaysia)

INTERIM FINANCIAL STATEMENTS FOR THE FIRST QUARTER ENDED 31 MARCH 2026

Unaudited Condensed Consolidated Statements of Financial Position

| | AS AT
31/03/2026
RM | AS AT
31/12/2025
RM |
| --- | --- | --- |
| ASSETS | | |
| Non-current assets | | |
| Property, plant & equipment | 121,291,305 | 122,348,850 |
| Investment in associates | 13,274,372 | 13,035,384 |
| Deferred tax assets | 7,057,012 | 5,844,783 |
| | 141,622,689 | 141,229,017 |
| Current assets | | |
| Inventories | 86,185,712 | 79,172,030 |
| Trade and other receivables | 25,326,012 | 36,274,528 |
| Contract assets | 266,849,900 | 272,012,416 |
| Other current assets | 9,461,477 | 10,690,039 |
| Short term funds | 203,361,819 | 196,849,260 |
| Cash and short-term deposits | 47,822,670 | 37,411,464 |
| | 639,007,590 | 632,409,737 |
| TOTAL ASSETS | 780,630,279 | 773,638,754 |
| EQUITY AND LIABILITIES | | |
| Equity | | |
| Issued capital | 175,254,461 | 175,254,461 |
| Retained earnings | 226,608,926 | 231,212,167 |
| Equity attributable to equity holders of the parent | 401,863,387 | 406,466,628 |
| Non-controlling interests | 169,122,748 | 168,261,892 |
| Total equity | 570,986,135 | 574,728,520 |
| Non-current liabilities | | |
| Deferred tax liabilities | 6,758,462 | 6,605,635 |
| Lease liabilities | 79,436 | 91,521 |
| | 6,837,898 | 6,697,156 |
| Current liabilities | | |
| Contract liabilities | 22,416,675 | 23,548,528 |
| Lease liabilities | 127,475 | 91,448 |
| Trade and other payables | 180,088,204 | 168,379,869 |
| Income tax payable | 173,892 | 193,233 |
| | 202,806,246 | 192,213,078 |
| Total liabilities | 209,644,144 | 198,910,234 |
| TOTAL EQUITY AND LIABILITIES | 780,630,279 | 773,638,754 |

(These Condensed Consolidated Statements of Financial Position should be read in conjunction with the accompanying explanatory notes attached to these interim financial statements.)

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KKB ENGINEERING BERHAD

(Company No : 26495 - D)

(Incorporated in Malaysia)

INTERIM FINANCIAL STATEMENTS FOR THE FIRST QUARTER ENDED 31 MARCH 2026

Unaudited Condensed Consolidated Statements of Changes in Equity

	<- Attributable to equity holders of the parent ->
	Issued Capital RM	Retained Earnings RM	Total RM	Non-controlling Interests RM	Total Equity RM
At 1 January 2026	175,254,461	231,212,167	406,466,628	168,261,892	574,728,520
(Loss)/profit for the period	-	(4,603,241)	(4,603,241)	860,856	(3,742,385)
Other comprehensive income for the period	-	-	-	-	-
Total comprehensive (loss)/income for the period	-	(4,603,241)	(4,603,241)	860,856	(3,742,385)
At 31 March 2026	175,254,461	226,608,926	401,863,387	169,122,748	570,986,135
At 1 January 2025	175,254,461	238,342,460	413,596,921	53,748,976	467,345,897
Loss for the period	-	(1,361,374)	(1,361,374)	(1,773,518)	(3,134,892)
Other comprehensive income for the period	-	-	-	-	-
Total comprehensive loss for the period	-	(1,361,374)	(1,361,374)	(1,773,518)	(3,134,892)
At 31 March 2025	175,254,461	236,981,086	412,235,547	51,975,458	464,211,005

(These Condensed Consolidated Statements of Changes in Equity should be read in conjunction with the accompanying explanatory notes attached to these interim financial statements.)

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KKB ENGINEERING BERHAD

(Company No: 26495 - D)

(Incorporated in Malaysia)

INTERIM FINANCIAL STATEMENTS FOR THE FIRST QUARTER ENDED 31 MARCH 2026

Unaudited Condensed Consolidated Statements of Cash Flows

| | CUMULATIVE
3 MONTHS ENDED
31/03/2026
RM | CUMULATIVE
3 MONTHS ENDED
31/03/2025
RM |
| --- | --- | --- |
| Loss before taxation | (4,770,704) | (4,232,266) |
| Adjustments for: | | |
| Depreciation of property, plant and equipment | 1,802,940 | 2,183,499 |
| Finance costs | 264,612 | 1,688,080 |
| Property, plant and equipment written off | 1 | 15 |
| Gain on disposal of property, plant & equipment | - | (108,802) |
| Dividend income | (767,748) | (480,746) |
| Fair value changes in short term funds | (556,982) | (866,903) |
| Interest income from financial assets | (288,812) | (410,863) |
| Share of results of associates | (238,988) | 6,908 |
| Total adjustments | 215,023 | 2,011,188 |
| Operating cash flows before changes in working capital | (4,555,681) | (2,221,078) |
| Changes in working capital | | |
| Increase in inventories | (7,013,682) | (24,402,781) |
| Decrease in receivables | 10,845,332 | 46,047,217 |
| Decrease/(increase) in contract assets | 5,162,516 | (5,041,855) |
| (Decrease)/increase in contract liabilities | (1,131,853) | 10,393,224 |
| Increase/(decrease) in payables | 11,708,335 | (33,396,605) |
| Decrease in other current assets | 1,083,723 | 22,030 |
| Cash flows generated from/(used in) operations | 16,098,690 | (8,599,848) |
| Interest paid | (264,612) | (1,688,080) |
| Net taxes refunded/(paid) | 94,416 | (4,564,604) |
| Net cash flows generated from/(used in) operating activities | 15,928,494 | (14,852,532) |
| Investing activities | | |
| Proceeds from disposal of property, plant & equipment | - | 108,805 |
| Acquisition of property, plant and equipment | (683,070) | (629,362) |
| Investment in short term funds | (29,537,829) | (30,002,096) |
| Redemption of short term funds | 24,350,000 | 25,500,000 |
| Interest received | 391,996 | 516,275 |
| Net cash flows used in investing activities | (5,478,903) | (4,506,378) |
| Financing activities | | |
| Repayment of principal portion of lease liabilities | (38,384) | (36,502) |
| Increase in short-term deposits with maturity more than 3 months | (201,210) | (208,595) |
| Net cash flows used in financing activities | (239,594) | (245,097) |
| Net increase/(decrease) in cash and cash equivalents | 10,209,997 | (19,604,007) |
| Cash and cash equivalents at the beginning of the period | 26,324,324 | 42,490,235 |
| Cash and cash equivalents at the end of the period | 36,534,321 | 22,886,228 |

(These Condensed Consolidated Statements of Cash Flows should be read in conjunction with the accompanying explanatory notes attached to these interim financial statements.)

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KKB ENGINEERING BERHAD

(Company no: 26495-D)

(Incorporated in Malaysia)

NOTES TO THE QUARTERLY FINANCIAL STATEMENTS

Selected explanatory notes pursuant to Malaysian Financial Reporting Standards ("MFRS") 134 Interim Financial Reporting

1. Basis of Preparation

The condensed consolidated interim financial statements have been prepared in accordance with MFRS 134 Interim Financial Reporting issued by the Malaysian Accounting Standards Board ("MASB"), IAS 34 Interim Financial Reporting issued by the International Accounting Standards Board and Paragraph 9.22 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad.

The interim financial statements should be read in conjunction with the audited annual financial statements of the Group for the financial year ended 31 December 2025. The explanatory notes attached to the condensed consolidated interim financial statements provide an explanation of events and transactions that are significant to an understanding of the changes in the financial position and performance of the Group since the year ended 31 December 2025.

2. Significant Accounting Policies

The significant accounting policies and methods of computation applied in the interim financial statements are consistent with those adopted in the most recent audited annual financial statements for the financial year ended 31 December 2025 except for the adoption of the following, where applicable, when they become effective:

• Annual Improvement to MFRS Accounting Standards – Volume 11
• Amendments to MFRS 9 and MFRS 7: Contracts Referencing Nature-dependent Electricity
• Amendments to MFRS 9: Financial Instruments and MFRS 7: Financial Instruments: Disclosures: Amendments to the Classification and Measurement of Financial Instruments

Adoption of the above are not expected to have any material financial impact on the Group's results.

3. Seasonal or cyclical factors

The business operations of the Group are not significantly affected by any seasonal or cyclical factors in the current quarter and financial year to date.

4. Unusual Items Due to Their Nature, Size or Incidence

There were no unusual items affecting the assets, liabilities, equities, net income or cash flows of the Group in the current quarter and financial year to date.

5. Changes in Estimates

There were no significant changes in estimates of amounts reported in prior financial years which have a material effect in the current quarter and financial year to date.

6. Debt and equity securities

There were no issuances and repayments of debt and equity securities, share buy backs, shares cancellation, shares held as treasury shares and resale of treasury shares in the current quarter and financial year to date.

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1. Dividend paid

No dividend was paid in the current quarter and financial year to date.

1. Segmental Reporting

The information for business segments predominantly conducted in Malaysia for the current financial year to date was as follows:

RESULTS FOR PERIOD-TO-DATE ENDED 31 MARCH 2026

| | Manufacturing
RM | Engineering
RM | Eliminations
RM | Consolidated
RM |
| --- | --- | --- | --- | --- |
| External revenue | 6,485,086 | 18,113,471 | - | 24,598,557 |
| Inter-segment revenue | 7,744,887 | 6,313,645 | (14,058,532) | - |
| Total revenue | 14,229,973 | 24,427,116 | (14,058,532) | 24,598,557 |
| Results | 229,137 | (4,974,217) | - | (4,745,080) |
| Finance costs | (387) | (264,225) | - | (264,612) |
| Share of results of associates | 95,082 | 143,906 | - | 238,988 |
| Profit/(loss) before tax | 323,832 | (5,094,536) | - | (4,770,704) |
| Income tax credit | 17,115 | 1,011,204 | - | 1,028,319 |
| Profit/(loss) after tax | 340,947 | (4,083,332) | - | (3,742,385) |
| | ======== | ======== | ======== | ======== |
| OTHER DISCLOSURES | | | | |
| Finance income | 51,708 | 237,104 | - | 288,812 |
| Depreciation of property, plant and equipment | 197,901 | 1,605,039 | - | 1,802,940 |

RESULTS FOR PERIOD-TO-DATE ENDED 31 MARCH 2025

| | Manufacturing
RM | Engineering
RM | Eliminations
RM | Consolidated
RM |
| --- | --- | --- | --- | --- |
| External revenue | 7,360,769 | 37,782,244 | - | 45,143,013 |
| Inter-segment revenue | 16,968,011 | 5,805,724 | (22,773,735) | - |
| Total revenue | 24,328,780 | 43,587,968 | (22,773,735) | 45,143,013 |
| Results | 584,407 | (3,121,685) | - | (2,537,278) |
| Finance costs | (914) | (1,687,166) | - | (1,688,080) |
| Share of results of associates | 194,280 | (201,188) | - | (6,908) |
| Profit/(loss) before tax | 777,773 | (5,010,039) | - | (4,232,266) |
| Income tax (expense)/credit | (499,305) | 1,596,679 | - | 1,097,374 |
| Profit/(loss) after tax | 278,468 | (3,413,360) | - | (3,134,892) |
| | ======== | ======== | ======== | ======== |

OTHER DISCLOSURES

Finance income 49,167 361,696 - 410,863

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Depreciation of property, plant and equipment

168,653

2,014,846

-

2,183,499

9. Material subsequent events

There were no material subsequent events as at the date of this announcement.

10. Changes in composition of the Group

There were no changes in composition of the Group for the current quarter and financial year to date.

11. Fair Value of Financial Instruments

(a) Determination of fair value

The carrying amounts of trade and other receivables, trade and other payables, cash and short-term deposits are reasonable approximation of fair values, due to their short-term and interest-bearing nature. In addition to that, trade receivables and trade payables are subject to normal trade credit terms.

(b) Fair value hierarchy

The Group classifies fair value measurement using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

Level 1 - Quoted prices in active markets for identical assets or liabilities;

Level 2 - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly; and

Level 3 - Inputs for the asset or liability that are not based on observable market data (unobservable inputs)

Quantitative disclosures of the fair value measurement hierarchy were as follows:

	Date of valuation	Level 1 RM	Level 2 RM	Level 3 RM	Total RM
Assets measured at fair value:
Short term funds	31/03/2026	-	203,361,819	-	203,361,819
	31/12/2025	-	196,849,260	-	196,849,260

There has been no transfers between the fair value hierarchy during the period.

12. Contingent liabilities/Contingent assets as at 31 March 2026

There were no material contingent liabilities or contingent assets as at the date of this announcement.

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13. Capital Commitments

| | As At
31/03/2026
RM | As At
31/03/2025
RM |
| --- | --- | --- |
| Commitments in respect of capital expenditure: | | |
| Property, plant and equipment | | |
| - Approved and contracted for | 1,236,490 | 74,882 |

14. Related Party Transactions

| | 3 Months Ended | | Cumulative 3 Months Ended
Current Period Ended
31/03/2026 RM | Comparative Period Ended
31/03/2025 RM |
| --- | --- | --- | --- | --- |
| | Current Quarter Ended 31/03/2026 RM | Comparative Quarter Ended 31/03/2025 RM | | |
| Transactions with an associate, Edisi Optima Sdn. Bhd. | | | | |
| - Provision of miscellaneous services such as machineries, equipments and labour etc | 189,574 | 273,818 | 189,574 | 273,818 |
| - Rental income | 22,500 | 28,500 | 22,500 | 28,500 |
| - Purchase of miscellaneous services such as machineries, equipments and labour etc | 31,510 | 19,955 | 31,510 | 19,955 |
| Transactions with related companies of investors, Cahya Mata Sarawak Bhd. and/or Sarawak Economic Development Corporation | | | | |
| - Purchase of cement, etc from CMS Infra Trading Sdn. Bhd. | 266,572 | 344,090 | 266,572 | 344,090 |
| Short term lease expense paid to companies in which certain directors of the Company have substantial financial interest and/or are also directors | | | | |
| - KKB Development Sdn. Bhd. | 28,650 | 28,650 | 28,650 | 28,650 |
| - KKB Realty Sdn. Bhd. | 24,300 | 18,200 | 24,300 | 18,200 |
| - Sepang Kaya Sdn. Bhd. | 32,708 | 33,325 | 32,708 | 33,325 |
| Short term lease expense paid to a director, Dato Sri Kho Kak Beng | 19,200 | 19,200 | 19,200 | 19,200 |
| Short term lease expense paid to person connected with certain directors of the Company | | | | |
| - Kho Siew Lan | 4,800 | 4,800 | 4,800 | 4,800 |
| - House Of Favourites | 2,000 | - | 2,000 | - |
| | 621,814 | 770,538 | 621,814 | 770,538 |

These transactions have been entered into with related parties on terms and conditions that are not more favourable to the related party than those generally available to the public.

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Explanatory notes pursuant to Appendix 9B of Main Market Listing Requirements of Bursa Malaysia Securities Berhad

1. Review Of Performance

Financial review for current quarter and financial year to date

	Quarter		Changes (%)	Cumulative 3 months		Changes (%)
	Current Quarter	Preceding Year Corresponding Quarter		Current Period	Preceding Year Corresponding Period
	31/03/26	31/03/25		31/03/26	31/03/25
	RM'000	RM'000		RM'000	RM'000
Revenue	24,599	45,143	-45.5%	24,599	45,143	-45.5%
Loss Before Interest, Taxes, Depreciation and Amortisation (EBITDA)	(2,703)	(361)	-648.8%	(2,703)	(361)	-648.8%
Loss before interest and tax	(4,506)	(2,544)	-77.1%	(4,506)	(2,544)	-77.1%
Loss before tax	(4,771)	(4,232)	-12.7%	(4,771)	(4,232)	-12.7%
Loss after tax	(3,742)	(3,135)	-19.4%	(3,742)	(3,135)	-19.4%
Loss attributable to equity holders of the parent	(4,603)	(1,361)	-238.2%	(4,603)	(1,361)	-238.2%

1Q26 group's revenue decreased by 45.5% compared to the preceding year corresponding first quarter, attributed to lower revenue recognition from the Civil Construction division although offset by higher revenue from the Steel Fabrication and LPG cylinders manufacturing divisions.

Group's current quarter revenue of RM24.6 million (1Q25: RM45.1 million) comprises revenue from the Engineering and Manufacturing sectors of RM18.1 million (1Q25: RM37.8 million) and RM6.5 million (1Q25: RM7.4 million), respectively.

Similarly, the Group registered a pre-tax loss of RM4.8 million in the current quarter compared to a pre-tax loss of RM4.2 million in the preceding year corresponding first quarter, mainly attributed to the weak performance of the Civil Construction division amidst slower business activities and lower progress billings.

The newly commenced project for the major Onshore fabrication works under the Steel Fabrication division is still at the early stage to contribute positively to the overall Group's performance.

Engineering Sector

The Engineering sector's revenue of RM18.1 million (1Q25: RM37.8 million) accounted 74% of the group's total revenue in 1Q26 compared to 84% in the preceding year corresponding first quarter.

The sector's revenue declined by 52.1% due to the completion of major Onshore Fabrication projects under the Steel Fabrication division and activities under the Civil Construction division have also slowed down in the absence of new major contract. The existing pipeline project works under the Civil Construction division i.e the Proposed Serian Regional Water Supply Phase II (Stage 1) is at its tail end.

For Steel Fabrication division, Group revenue increased by 28.3% to RM18.6 million, compared to RM14.5 million in the preceding year corresponding first quarter. Revenue for the current quarter was mainly from the newly commenced project i.e the Provision of Minor Engineering, Procurement and Construction (ePC) of Fixed Offshore Structure and Host Tie-In at Erb West for Belud South Greenfield Development ("Belud project") secured in January 2026 from Petronas Carigali Sdn Bhd; Kasawari

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Carbon Capture & Storage project and other miscellaneous fabrication works. The Belud project is still at the early stage to contribute to the group's overall performance.

Revenue for the Hot-Dip Galvanising division remained low although improved to RM896K in 1Q26 compared to RM71K in the preceding year corresponding first quarter.

Manufacturing Sector

The Manufacturing sector's revenue of RM6.5 million (1Q25: RM7.4 million) represents 26% of the group's total revenue for the current quarter. Revenue decreased by 12.2% over the preceding year corresponding first quarter, attributed to slower offtake of MSCL pipes by customers.

The Group's Steel Pipes manufacturing division recorded RM5.1 million in revenue for 1Q26 compared to RM6.9 million in the preceding year corresponding first quarter. 1Q26 revenue was mostly from the new supply orders for MSCL pipes secured in January 2026 supported by revenue contribution from the Steel Pipes manufacturing plant in Kota Kinabalu, Sabah. The supply order secured from Gamuda Berhad for the supply of MSCL Pipes and Specials for the Proposed Development of Skim Bekalan Air Ulu Padas, Sabah is still at the early stage to contribute to the group's performance.

For the LP Gas ("LPG) Cylinders manufacturing division, revenue increased to RM1.4 million compared to RM414K in the preceding year corresponding first quarter. The entire revenue of RM1.4 million was for the Reconditioning/Requalification of LPG Cylinders and supply of Compact Valves to Petrosniaga Sdn Bhd.

16. Material changes in the quarterly results compared to the results of the preceding quarter

Financial review for current quarter compared with immediate preceding quarter

	Current Quarter	Immediate Preceding Quarter	Changes (%)
	31/03/26	31/12/25
	RM'000	RM'000
Revenue	24,599	32,568	-24.5%
(Loss)/Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA)	(2,703)	7,841	-134.5%
(Loss)/profit before interest and tax	(4,506)	6,107	-173.8%
(Loss)/profit before tax	(4,771)	5,883	-181.1%
(Loss)/profit after tax	(3,742)	7,352	-150.9%
(Loss)/profit attributable to equity holders of the parent	(4,603)	6,733	-168.4%

Group's revenue for the current quarter of RM24.6 million decreased by 24.5%, compared to the immediate preceding quarter of RM32.6 million, due to lower revenue contribution from the Steel Pipes Manufacturing business and Civil Construction division although offset by higher revenue from the Steel Fabrication division.

The Steel Pipes Manufacturing business recorded a revenue of RM5.1 million in 1Q26 compared to RM15.5 million in 4Q25, attributed to slower offtake of MSCL pipes by clients.

Current quarter saw the Group posted a pre-tax loss of RM4.8 million against a pre-tax profit of RM5.9 million in the preceding quarter amidst lower revenue in 1Q26. The Civil Construction activities also slowed down in the absence of new major contract. The on-going pipeline project works under the Civil Construction division i.e the Proposed Serian Regional Water Supply Phase II (Stage 1) is at its tail end.

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1. Prospects

The new contracts secured in January 2026 i.e the Provision of Minor Engineering, Procurement and Construction (ePC) of Fixed Offshore Structure and Host Tie-In at Erb West for Belud South Greenfield Development (GFD) Project together with the supply orders for the MSCL Pipes are still at the early stage to contribute to the Group's financial performance in 1Q26. These projects will ramp up from 2Q26 onwards.

The Group maintains its cautious outlook on performance of its Engineering sector, particularly the Civil Construction division in the absence of new major contract. The on-going pipeline project works under the Civil Construction division i.e the Proposed Serian Regional Water Supply Phase II (Stage 1) is progressing smoothly and at its tail end.

Notwithstanding, Management and Board remain positive that KKB Group will perform favourably for the financial year ending 2026, supported by the existing contracts in hand for the major Onshore fabrication works for the Oil & Gas facilities, including the on-going orders for the supply of Steel Pipes to Sabah and Sarawak.

Management actively continues to participate in new tenders or biddings, to secure major Onshore fabrication works for the Oil & Gas facilities as well as other infrastructure projects for Construction and Water works, including the supply of Steel Pipes to replenish our order book for both the Engineering and Manufacturing sectors.

The Group's diversified operations coupled with its healthy financial position will continue to bolster the Group's development in bracing the adverse impact under the challenging and competitive business environment.

The Group remains vigilant of the challenges and the continued uncertainties in the global economic environment as a result of the Middle East crisis, escalation of costs due to inflationary pressure and volatility of global raw material steel prices are amongst factors that may impact the Group's performance.

1. Variances from financial estimate, forecast or projection, or profit guarantee

Not applicable to the Group as no financial estimate, forecast or projection, or profit guarantee were published.

1. Commentary on the company's progress to achieve the financial estimate, forecast, projection or internal targets in the remaining period to the end of the financial year and the forecast period which was previously announced or disclosed in a public document and steps taken or proposed to be taken to achieve the financial estimate, forecast, projection or internal targets

Not applicable to the Group as no announcements or disclosures were published in a public document as to the financial estimate, forecast, projection or internal targets as at the date of this announcement.

1. Statement of the Board of Directors' opinion as to whether the financial estimate, forecast, projection or internal targets in the remaining period to the end of the financial year and the forecast period which was previously announced or disclosed in a public document are likely to be achieved

Not applicable to the Group as no announcements or disclosures were published in a public document as to the financial estimate, forecast, projection or internal targets as at the date of this announcement.

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1. Income Tax Credit

	3 Months Ended		Cumulative 3 Months Ended
	Current Quarter Ended 31/03/2026 RM	Comparative Quarter Ended 31/03/2025 RM	Current Period Ended 31/03/2026 RM	Comparative Period Ended 31/03/2025 RM
Malaysian taxation
- Current year	31,084	9,400	31,084	9,400
Deferred tax	(1,059,403)	(1,106,774)	(1,059,403)	(1,106,774)
	(1,028,319)	(1,097,374)	(1,028,319)	(1,097,374)

The lower effective tax credit for the current quarter and financial year to date were primarily attributed to certain losses at subsidiaries level for which no deferred tax assets were provided.

1. Status of Corporate Proposals

There were no new or outstanding corporate proposals announced which have not been completed as at the date of this announcement.

1. Group's Borrowings and Debt Securities

Total Group's loans and borrowings as at 31 March 2026 were as follows: -

Interest-bearing Loans and Borrowings (denominated in Ringgit Malaysia)

	Secured RM	Unsecured RM
Current
Lease liabilities	-	127,475
Non-Current
Lease liabilities	-	79,436
Total borrowings	-	206,911

Total Group's loans and borrowings as at 31 March 2025 were as follows: -

Interest-bearing Loans and Borrowings (denominated in Ringgit Malaysia)

	Secured RM	Unsecured RM
Current
Lease liabilities	-	131,591
Non-Current
Lease liabilities	-	150,063
Total borrowings	-	281,654

1. Off Balance Sheet Financial Instruments

There are no financial instruments with off balance sheet risks entered into by the Group as at the date of this announcement.

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1. Derivative Financial Instruments

There were no derivative financial instruments entered into by the Group as at 31 March 2026.

1. Gains/Losses Arising from Fair Value Changes of Financial Liabilities

There were no gains/losses arising from fair value changes of financial liabilities for the current quarter and financial year to date.

1. Material Litigations

Saved as disclosed below, there were no pending material litigations against the Group which might materially and adversely affect the Group's financial position:-

(i) An announcement was made to Bursa Malaysia Securities Berhad on 15 September 2023 that its subsidiary OceanMight Sdn. Bhd. ("OMSB") has issued a notice to commence arbitration proceedings ("Arbitration Notice") against Shapadu Energy Services Sdn. Bhd.

1. Dividend

A first and final single tier dividend of 3.8 sen per ordinary share, in respect of the financial year ended 31 December 2025 has been recommended by the Board of Directors on 12 February 2026, payable to shareholders of the Company whose names appear in the Record of Depositors on 3 June 2026.

The payment of this first and final dividend is subject to the shareholders' approval at the forthcoming Fiftieth (50th) Annual General Meeting to be held on 22 May 2026, and if approved will be paid on 16 June 2026.

1. Earnings per share

	3 Months Ended		Cumulative 3 Months Ended
	Current Quarter Ended 31/03/2026	Comparative Quarter Ended 31/03/2025	Current Period Ended 31/03/2026	Comparative Period Ended 31/03/2025
Net loss attributable to equity holders of the parent (RM)	(4,603,241)	(1,361,374)	(4,603,241)	(1,361,374)
Weighted average number of ordinary shares in issue	288,727,040	288,727,040	288,727,040	288,727,040
Basic loss per share for the period attributable to equity holders of the parent (sen)	(1.59)	(0.47)	(1.59)	(0.47)

There is no dilution in its loss per ordinary share in the current quarter and financial year to date as there are no dilutive potential ordinary shares outstanding at the end of the reporting period.

1. Auditors' Report on Preceding Annual Financial Statements

The auditors' report on the audited financial statements for the financial year ended 31 December 2025 was not qualified.

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31. Additional Disclosures on Loss for the period

	3 Months Ended		Cumulative 3 Months Ended
	Current Quarter Ended 31/03/2026 RM	Comparative Quarter Ended 31/03/2025 RM	Current Period Ended 31/03/2026 RM	Comparative Period Ended 31/03/2025 RM
Loss for the period is arrived at after charging/(crediting):
Interest income from financial assets	(288,812)	(410,863)	(288,812)	(410,863)
Realised foreign exchange loss	125,255	7,992	125,255	7,992
Rental income	(349,136)	(119,160)	(349,136)	(119,160)
Gain on disposal of property, plant and equipment	-	(108,802)	-	(108,802)
Depreciation of property, plant and equipment	1,802,940	2,183,499	1,802,940	2,183,499
Finance costs	264,612	1,688,080	264,612	1,688,080
Property, plant and equipment written off	1	15	1	15

Other than the above items which have been included in the statement of profit or loss and other comprehensive income, there were no provision for and write off of receivables and inventories, gain or loss on disposal of quoted or unquoted investments, gain or loss on derivatives and exceptional items for the current quarter and period ended 31 March 2026.