Singapore Company Focus

Biosensors International Group

Bloomberg: BIG SP | Reuters: BIOS.SI

Refer to important disclosures at the end of this report

DBS Group Research . Equity

8 Feb 2013

BUY S$1.37 STI : 3,261.77

Price Target : 12-Month S$ 1.71 (Prev S$ 1.41) Reason for Report : 3Q13 Results/Change in earnings and TP Potential Catalyst: Potential acquistiion DBSV vs Consensus: Below consensus Analyst Alfie YEO +65 6398 7957 AlfieYeo@dbsvickers.com Andy SIM CFA +65 6398 7969 andysim@dbsvickers.com

Enhancing shareholder value

3Q13 results 16% below expectations as Terumo sales disappoints again Positive catalyst from impending acquisition utilising S$300m funds raised

Price Relative
S$ 1.7 1.5 1.3 1.1 0.9 0.7 0.5 0.3 Feb-09 Feb-10 Feb-11 Feb-12 89 Feb-13 189 239 Relative Index 289

Maintain BUY with higher TP of S$1.71 16% below expectations, Terumo disappoints again. Net profit of US$24.9m for the quarter was 16% below our US$29.5m expectations. Terumo licensing revenue was US$13.7m (-38% y-o-y, -4% q-oq), 24% below our forecast of US$18m as a result of reduction in Terumos DES sales in Japan. More optimistic on potential acquisitions. We are more optimistic on BIGs impending acquisition than 3Q13 results. BIG announced two weeks ago that it raised S$300m from 4.875% semi-annual fixed rate notes due 2017. We believe BIG might announce an acquisition very soon. Management indicated that there are discussions for some targets. Given managements preference for market approved product technology, the acquisition targets are likely to be earnings accretive in our view. Better shareholder value than before. Despite reducing earnings forecast due to higher interest expense, we have raised our valuation of BIG after factoring in: 1) lower WACC of 9.3% used in the DCF valuation of BIGs core operations arising from higher debt to capital ratio; 2) share buyback which reduced the number of shares in issue. Maintain BUY, TP raised to S$1.71. Based on SOTP valuation of BIG, our TP is now raised to S$1.71. Our TP implies 19.7x FY14F PE, in line with regional peers average valuation of 19x. Maintain BUY for potential upside of 25%.
At A Glance Issued Capital (m shrs) Mkt. Cap (S$m/US$m) Major Shareholders Weigao Int'l (%) Autumn Eagle (%) FMR (%) Free Float (%) Avg. Daily Vol.(000)

139

Biosensors International Group (LHS)

Relative STI INDEX (RHS)

Forecasts and Valuation

FY Mar (US$ m) 2012A 2013F 2014F 2015F

Revenue EBITDA Pre-tax Profit Net Profit Net Pft (Pre Ex.) EPS (S cts) EPS Pre Ex. (S cts) EPS Gth (%) EPS Gth Pre Ex (%) Diluted EPS (S cts) Net DPS (S cts) BV Per Share (S cts) PE (X) PE Pre Ex. (X) P/Cash Flow (X) EV/EBITDA (X) Net Div Yield (%) P/Book Value (X) Net Debt/Equity (X) ROAE (%) Earnings Rev (%): Consensus EPS (S cts): Other Broker Recs:

292 111 366 364 101 29.9 8.3 505 38 29.3 0.0 80.5 4.6 16.5 20.6 12.5 0.0 1.7 CASH 48.7

336 120 116 113 110 8.2 7.9 (73) (5) 8.0 0.0 87.3 16.8 17.4 19.0 12.9 0.0 1.6 CASH 9.7 (7.1) 8.8 B: 11

422 144 128 125 125 9.0 9.0 10 14 8.8 0.0 96.3 15.2 15.2 16.9 10.1 0.0 1.4 CASH 9.8 (13.8) 10.3 S: 0

500 134 119 107 107 7.7 7.7 (15) (15) 7.5 0.0 104.0 17.8 17.8 20.3 10.3 0.0 1.3 CASH 7.7 (20.6) 11.2 H: 2

1,712 2,346 / 1,894 21.6 15.7 10.5 44.6 6,138

ICB Industry : Health Care ICB Sector: Health Care Equipment & Servic Principal Business: Manufacturer of medical devices such as drugeluting stents and critical care catheter systems.

Source of all data: Company, DBS Vickers, Bloomberg

www.dbsvickers.com ed: JS / sa: AS

Company Focus Biosensors International Group

3Q13 below expectations, Terumo disappoints again 3Q13 earnings 16% below expectations. Net profit of US$24.9m for the quarter was 16% below our US$29.5m expectations. Terumo licensing revenue recorded US$13.7m (-38% y-o-y, -4% q-o-q), 24% below our forecast of US$18m as a result of reduction in Terumos DES sales in Japan. Operating expenses were 10% higher than our estimate as sales and marketing costs came in 22% higher than anticipated. On the back of Terumos weak contribution, managements revenue growth guidance for FY13F is now 15%-20% instead of 30% previously. Product revenue within expectations, margins expanded. Product revenue came in within expectations at US$67.6m vs our forecast of US$69.8m. While DES volumes grew 14% yo-y, price reductions in markets such as India capped product revenue growth at 8%. Markets such as Europe, Middle East Africa (EMEA) and Asia Pacific contributed double digit y-o-y growth. DES gross margins expanded further benefitting from better economies of scale and change of business model distribution to a partially direct sales model in Latin America. DES gross margins maintained above 80%
Gross Profit margin Critical care Interventional cardiology Licencing and royalties Overall gross margins 3Q12 40.5% 71.7% 100.0% 77.6% 2Q13 38.8% 82.5% 100.0% 83.7% 3Q13 40.6% 83.9% 100.0% 84.7%

More optimistic on potential acquisition than 3Q13 results Raised S$300m two weeks ago. We are more optimistic on BIGs impending acquisition than 3Q13 results. BIG announced two weeks ago that it raised S$300m from 4.875% semi-annual fixed rate notes due 2017. Together with US$350m cash on its books, its cash balance now stands at US$725m. We believe an acquisition should be on the way. We doubt that management will be content to undertake 4.875% funding cost without deploying the funds meaningfully and quickly. This leads us to believe BIG might announce an acquisition very soon. Management cited that it has looked at several potential M&A targets and discussions are ramping up for some. Ideally, management prefers a target that has technology already approved for sale in the market and capability of generating revenue from US and/or Europe. Given the above preferences, the acquisition targets are likely to be earnings accretive, in our view. 14% cut in earnings for FY14F as a result of 4.875% interest costs. We factor in 4.875% interest cost for S$300m fixed rate notes. Interest expense amounts to c.US$18m for five years which results in lower earnings of US$125m. However, this could be offset depending on the acquisition targets' earnings contribution.

Source: Company, DBS Vickers

Raise TP to S$1.71 based on SOTP valuation Product portfolio is developing. BioFreedom received CE mark approval last week. BIGs plan is to launch BioFreedom on a trial basis in selected markets in 2013 before full commercial launch planned for 2014. Due to the phased launch, we should see a marginal impact on financials. Meanwhile, BIG has established an OEM agreement with an outsourced manufacturer to develop its own Biosensors branded Drug Eluting Balloons. Other products under development include new sizes of Axxess stent, bare metal cobalt chromium stent and a flex version of BioFreedom stent. More per share value attributed to BIG despite earnings reduction impacted by LT debt issue. Despite earnings reduction due to higher interest expense, we raise our valuation of BIG after factoring in the following: 1) Our DCF valuation of BIGs core operations assumes a lower WACC 9.3% vs 10%, arising from a its S$300m LT debt issuance, thereby raising the debt to capital ratio to 24% with cost of debt at 4.875%. 2) BIG instituted share buybacks to the tune of 19.8m shares from 8 Nov 2012 to 4 Dec 2012, which reduced the number of shares in issue. Maintain BUY, TP S$1.71. Based on SOTP valuation of BIG, our TP is now raised to S$1.71. Our TP implies 19.7x FY14F PE, in line with regional peers average valuation of 19x. Maintain BUY for potential upside of 25%.

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Company Focus Biosensors International Group

Results Summary and comments
FY Mar (US$m) Sales Cost of Goods Sold Gross Profit Other Operating Income 3Q12 84.8 (19.0) 65.8 0.2 (27.6) (7.3) (5.7) (2.0) (42.5) 23.5 0.9 (1.5) 264.8 287.6 3.9 291.5 2Q13 79.8 (13.0) 66.8 0.5 (18.3) (9.2) (5.5) (0.3) (33.3) 33.9 1.1 (1.6) (5.1) 28.3 (0.2) 28.2 3Q13 81.3 (12.4) 68.9 0.2 (25.6) (9.8) (5.6) (0.9) (41.9) 27.2 1.0 (1.2) (3.5) 23.5 1.5 24.9 yoy chg % -4.0% -34.4% 4.7% -24.7% -7.2% 35.2% -0.8% -56.1% -1.4% 15.5% 15.6% -18.7% n/m n/m -62.7% n/m qoq chg % 2.0% -4.5% 3.2% -62.7% 39.8% 6.9% 1.7% n/m 25.8% -19.9% -7.4% -21.8% -32.3% -17.0% n/m -11.4% Below US$29.5m estimate Non cash adjustment in 3Q12 acquired JWMS 25% below expectations Higher than expected 22% higher than expected Comments Terumo licensing revenue below expectations Higher than expected GPM of 84.7% 6% below expectations on weak Terumo sales

Sales and Marketing Costs Administration Expenses Research and Development Expenses Others
Other Operating Expenses EBIT Interest Income Interest Expense Exceptional Gains/(Losses) Pretax Profit Tax Net Profit

Source: Company, DBS Vickers

Sum-of-parts valuation methodology

Valuation - Sum-of-parts Biosensor and JWMS operations Terumo licensing Net Cash/ (Debt) Equity value US$m Add: Cash from warrants/option Total equity value US$ m (incl. cash from warrants/options) Total equity value (S$ m) Total shares (incl. warrants/ options) Target price (S$) US$m 1,875.8 226.1 349.8 2,451.7 20.5 2,472.1 3,016.0 1,765 1.71 Based on fx of S$1.22/US$ Smaller base post share buyback, warrants expiry Warrants expired 3 Dec 2012 Remarks DCF, DES mkt share of 3.8% by 2015, WACC 9.3%, t = 5% NPV of Terumo licensing agreement till 2016, WACC: 9.3%

Source: DBS Vickers

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Company Focus Biosensors International Group

Key Assumptions
FY Mar 2011A 2012A 2013F 2014F 2015F

Global DES size (US$ DES mkt share (%) Royalties growth (%) JWMS growth (%) Opg exp as % of sales Segmental Breakdown
FY Mar

4.8 2.0 88.8 32.6 50.1

4.9 2.5 370.4 20.0 44.2

5.0 3.0 (25.4) 15.0 46.2

5.2 3.5 19.4 15.0 45.1

5.4 4.0 0.0 10.0 46.6

2011A

2012A

2013F

2014F

2015F

Revenues (US$ m) Critical Care Interventional Licensing & Royalties

13 126 17

15 197 81

15 261 60

18 332 72

19 409 72

Weaker contribution from Terumo

Total Gross Profit (US$ m) Critical Care Interventional Licensing & Royalties

157 5 100 17

292 6 148 81

336 6 216 60

422 7 263 72

500 8 294 72

Better economies of scale

Total Gross Profit Margins Critical Care Interventional Licensing & Royalties

122 36.1 79.3 100.0

235 41.3 75.1 100.0

282 40.2 82.9 100.0

342 40.0 79.0 100.0

374 40.0 72.0 100.0

Factoring in margin compression from lower ASPs in China

Total Income Statement (US$ m)

FY Mar

78.0

80.3

84.1

80.9

74.8 Margins Trend

2011A

2012A

2013F

2014F

2015F

Revenue Cost of Goods Sold Gross Profit Other Opng (Exp)/Inc Operating Profit Other Non Opg (Exp)/Inc Associates & JV Inc Net Interest (Exp)/Inc Exceptional Gain/(Loss) Pre-tax Profit Tax Minority Interest Preference Dividend Net Profit Net Profit before Except. EBITDA Growth Revenue Gth (%) EBITDA Gth (%) Opg Profit Gth (%) Net Profit Gth (%) Margins & Ratio Gross Margins (%) Opg Profit Margin (%) Net Profit Margin (%) ROAE (%) ROA (%) ROCE (%) Div Payout Ratio (%) Net Interest Cover (x)

157 (35) 122 (78) 44 0 19 (5) (9) 49 (6) 0 0 43 53 67 34.8 66.7 102.0 35.0 78.0 28.3 27.6 16.5 12.3 13.2 0.0 8.6

292 (58) 235 (128) 107 (8) 8 (4) 263 366 (1) 0 0 364 101 111 86.6 67.2 140.2 741.9 80.3 36.5 124.7 48.7 42.0 13.3 0.0 27.7

336 (53) 282 (153) 129 (16) 0 (1) 4 116 (3) 0 0 113 110 120 15.0 8.0 21.2 (68.8) 84.1 38.4 33.8 9.7 7.7 9.0 0.0 187.0

422 (81) 342 (187) 155 (16) 0 (11) 0 128 (3) 0 0 125 125 144 25.7 19.9 20.2 10.4 80.9 36.8 29.7 9.8 7.1 9.1 0.0 14.1

500 (126) 374 (229) 145 (16) 0 (10) 0 119 (12) 0 0 107 107 134 18.4 (7.0) (6.7) (14.8) 74.8 29.0 21.3 7.7 5.7 7.3 0.0 14.4

117.0% 97.0% 77.0% 57.0% 37.0% 17.0% 2010A 2011A 2012A 2013F 2014F
Operating Margin % Net Income Margin %

Non cash amortization of US$16m a year for 10 years from FY12 Higher interest cost from S$300m 4.875% fixed rate notes Revenue growth guidance reduced to 15%-20% on weak licensing contribution.

Source: Company, DBS Vickers

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Company Focus Biosensors International Group

Quarterly / Interim Income Statement (US$ m)
FY Mar 3Q2012 4Q2012 1Q2013 2Q2013 3Q2013

Revenue Trend
100 90 80 70 60 50 40 30 20 10 0
1Q2012 2Q2012 3Q2012 4Q2012 1Q2013 2Q2013 3Q2013 2Q2011 3Q2011 4Q2011

40% 35% 30% 25% 20% 15% 10% 5% 0% -5% -10%

Revenue Cost of Goods Sold Gross Profit Other Oper. (Exp)/Inc Operating Profit Other Non Opg (Exp)/Inc Associates & JV Inc Net Interest (Exp)/Inc Exceptional Gain/(Loss) Pre-tax Profit Tax Minority Interest Net Profit Net profit bef Except. EBITDA Growth Revenue Gth (%) EBITDA Gth (%) Opg Profit Gth (%) Net Profit Gth (%) Margins Gross Margins (%) Opg Profit Margins (%) Net Profit Margins (%)

85 (19) 66 (42) 24 0 0 (1) 265 288 4 0 292 27 29

88 (16) 72 (41) 32 0 0 (1) (1) 30 (2) 0 27 29 33

86 (13) 73 (40) 34 (4) 0 0 4 33 (1) 0 33 28 31

80 (13) 67 (33) 34 (4) 0 0 (1) 28 0 0 28 29 32

81 (12) 69 (42) 27 (4) 0 0 1 23 1 0 25 24 25

Revenue

Revenue Growth % (QoQ)

Weaker licensing revenue contribution y-o-y

36.3 17.9 19.0 1,170.7 77.6 27.7 344.0

4.0 14.2 34.6 (90.7) 82.0 35.9 30.9

(2.1) (5.5) 6.4 19.9 84.8 39.0 37.8

(7.6) 0.6 0.7 (13.7) 83.7 42.5 35.3

2.0 (21.3) (19.9) (11.4) 84.7 33.4 30.7

Non cash impact on JWMS consolidation

Balance Sheet (US$ m)

FY Mar 2011A 2012A 2013F 2014F 2015F

Asset Breakdown (2013) 12 116 21 259 22 40 8 478 0 62 34 4 379 0 478 8 225 76.8 26.5 229.6 0.4 5.4 4.9 CASH CASH 8.1 8.0 43 0 785 314 35 71 11 1,257 37 78 0 24 1,118 0 1,257 38 276 69.3 34.4 194.7 0.3 3.7 3.3 CASH CASH 85.2 7.7 52 0 769 725 45 92 11 1,693 0 81 375 24 1,213 0 1,693 67 350 88.4 69.1 313.3 0.2 10.8 10.1 CASH CASH 4.0 11.3 63 0 752 821 57 116 11 1,821 0 83 375 24 1,338 0 1,821 101 446 90.1 54.1 245.3 0.2 12.1 11.3 CASH CASH 4.1 11.3 72 0 736 901 69 141 11 1,930 0 86 375 24 1,445 0 1,930 135 526 94.0 41.9 190.0 0.3 13.0 12.1 CASH CASH 3.7 11.2
Debtors 15.3% Net Fixed Assets 9.3% Assocs'/JVs 0.0%

Net Fixed Assets Invts in Associates & JVs Other LT Assets Cash & ST Invts Inventory Debtors Other Current Assets Total Assets ST Debt Other Current Liab LT Debt Other LT Liabilities Shareholders Equity Minority Interests Total Cap. & Liab. Non-Cash Wkg. Capital Net Cash/(Debt) Debtors Turn (avg days) Creditors Turn (avg days) Inventory Turn (avg days) Asset Turnover (x) Current Ratio (x) Quick Ratio (x) Net Debt/Equity (X) Net Debt/Equity ex MI (X) Capex to Debt (%) Z-Score (X)

Inventory 7.5% Bank, Cash and Liquid Assets 67.9%

S$300m 4.875% semiannual fixed rate notes due 2017

Source: Company, DBS Vickers

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Company Focus Biosensors International Group

Cash Flow Statement (US$ m)

FY Mar 2011A 2012A 2013F 2014F 2015F

Capital Expenditure 49 2 (3) (19) (16) 14 28 (3) (7) 0 0 0 (10) 0 0 176 0 176 5 199 4.0 2.3 366 13 (13) (8) (28) (249) 81 (32) 0 0 0 0 (32) 0 0 8 0 8 5 62 7.2 3.3 116 23 (3) 0 (30) (7) 100 (15) 0 0 0 (1) (16) 0 338 (11) 0 327 0 411 7.5 4.9 128 21 (3) 0 (34) 0 112 (15) 0 0 0 (1) (16) 0 0 0 0 0 0 97 8.5 5.6 119 21 (12) 0 (34) 0 94 (14) 0 0 0 (1) (14) 0 0 0 0 0 0 79 7.4 4.6
35 30 25 20 15 10 5 0 2010A 2011A 2012A 2013F 2014F

Pre-Tax Profit Dep. & Amort. Tax Paid Assoc. & JV Inc/(loss) Chg in Wkg.Cap. Other Operating CF Net Operating CF Capital Exp.(net) Other Invts.(net) Invts in Assoc. & JV Div from Assoc & JV Other Investing CF Net Investing CF Div Paid Chg in Gross Debt Capital Issues Other Financing CF Net Financing CF Currency Adjustments Chg in Cash Opg CFPS (US cts.) Free CFPS (US cts.)

Capital Expenditure (-)

Non cash adjustment on JWMS consolidation

Raised S$300m in fixed rate notes

Source: Company, DBS Vickers

Includes share buyback of 19.8m shares

Target Price & Ratings History

1.71 1.61 1.51 1 1.41 1.31 1.21 1.11 1.01 Feb-12 S.No . Cl o s i n g Ta rg e t Pri c e Pri c e 09 Feb 12 1.55 1.68 12 Mar 12 1.38 1.68 Da te 29 Mar 12 30 May 12 27 Jun 12 03 Jul 12 26 Jul 12 08 Nov 12 1.48 1.28 1.15 1.19 1.23 1.12 1.68 1.57 1.57 1.57 1.57 1.41 R a ti n g Hold Buy Buy Buy Buy Buy Buy Buy S$

3 2 4 7 6 5
Apr-12 Jun-12 Aug-12 Oct-12

1: 2: 3: 4: 5: 6: 7: 8: Dec-12 Feb-13

Not e : Share price and Target price are adjusted for corporate actions.

Source: DBS Vickers

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Company Focus Biosensors International Group

DBSV recommendations are based an Absolute Total Return* Rating system, defined as follows: STRONG BUY (>20% total return over the next 3 months, with identifiable share price catalysts within this time frame) BUY (>15% total return over the next 12 months for small caps, >10% for large caps) HOLD (-10% to +15% total return over the next 12 months for small caps, -10% to +10% for large caps) FULLY VALUED (negative total return i.e. > -10% over the next 12 months) SELL (negative total return of > -20% over the next 3 months, with identifiable catalysts within this time frame)

Share price appreciation + dividends

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GENERAL DISCLOSURE/DISCLAIMER This report is prepared by DBS Vickers Research (Singapore) Pte Ltd ("DBSVR"), a direct wholly-owned subsidiary of DBS Vickers Securities (Singapore) Pte Ltd ("DBSVS") and an indirect wholly-owned subsidiary of DBS Vickers Securities Holdings Pte Ltd ("DBSVH"). This report is intended for clients of DBSV Group only and no part of this document may be (i) copied, photocopied or duplicated in any form or by any means or (ii) redistributed without the prior written consent of DBSVR. It is being distributed in the United States by DBSV US, which accepts responsibility for its contents. Any U.S. person receiving this report who wishes to effect transactions in any securities referred to herein should contact DBS Vickers Securities (USA) Inc (DBSVUSA) directly and not its affiliate. The research set out in this report is based on information obtained from sources believed to be reliable, but we (which collectively refers to DBSVR, DBSVS, and/or DBSVH) do not make any representation or warranty as to its accuracy, completeness or correctness. Opinions expressed are subject to change without notice. This document is prepared for general circulation. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and the particular needs of any specific addressee. This document is for the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees, who should obtain separate independent legal or financial advice. DBSVR accepts no liability whatsoever for any direct, indirect and/or consequential loss (including any claims for loss of profit) arising from any use of and/or reliance upon this document and/or further communication given in relation to this document. This document is not to be construed as an offer or a solicitation of an offer to buy or sell any securities. DBSVH is a wholly-owned subsidiary of DBS Bank Ltd. DBS Bank Ltd along with its affiliates and/or persons associated with any of them may from time to time have interests in the securities mentioned in this document. DBSVR, DBSVS, DBS Bank Ltd and their associates, their directors, and/or employees may have positions in, and may effect transactions in securities mentioned herein and may also perform or seek to perform broking, investment banking and other banking services for these companies. Any valuations, opinions, estimates, forecasts, ratings or risk assessments herein constitutes a judgment as of the date of this report, and there can be no assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk assessments. The information in this document is subject to change without notice, its accuracy is not guaranteed, it may be incomplete or condensed and it may not contain all material information concerning the company (or companies) referred to in this report. The valuations, opinions, estimates, forecasts, ratings or risk assessments described in this report were based upon a number of estimates and assumptions and are inherently subject to significant uncertainties and contingencies. It can be expected that one or more of the estimates on which the valuations, opinions, estimates, forecasts, ratings or risk assessments were based will not materialize or will vary significantly from actual results. Therefore, the inclusion of the valuations, opinions, estimates, forecasts, ratings or risk assessments described herein IS NOT TO BE RELIED UPON as a representation and/or warranty by DBSVR, DBSVS and/or DBSVH (and/or any persons associated with the aforesaid entities), that: (a) such valuations, opinions, estimates, forecasts, ratings or risk assessments or their underlying assumptions will be achieved, and (b) there is any assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk assessments stated therein. Any assumptions made in this report that refers to commodities, are for the purposes of making forecasts for the company (or companies) mentioned herein. They are not to be construed as recommendations to trade in the physical commodity or in the futures contract relating to the commodity referred to in this report. DBS Vickers Securities (USA) Inc ("DBSVUSA")"), a U.S.-registered broker-dealer, does not have its own investment banking or research department, nor has it participated in any investment banking transaction as a manager or co-manager in the past twelve months. Any US persons wishing to obtain further information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed in this document should contact DBSVUSA exclusively.

ANALYST CERTIFICATION The research analyst primarily responsible for the content of this research report, in part or in whole, certifies that the views about the companies and their securities expressed in this report accurately reflect his/her personal views. The analyst also certifies that no part of his/her compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report. As of 8 Feb 2013, the analyst and his / her spouse and/or relatives who are financially dependent on the analyst, do not hold interests in the securities recommended in this report (interest includes direct or indirect ownership of securities, directorships and trustee positions).

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Company Focus Biosensors International Group

COMPANY-SPECIFIC / REGULATORY DISCLOSURES DBS Vickers Securities (Singapore) Pte Ltd and its subsidiaries do not have a proprietary position in the company mentioned as 1. of 06-Feb-2013 2. DBSVR, DBSVS, DBS Bank Ltd and/or other affiliates of DBS Vickers Securities (USA) Inc ("DBSVUSA"), a U.S.-registered brokerdealer, may beneficially own a total of 1% or more of any class of common equity securities of the company mentioned as of 8 Feb 2013. Compensation for investment banking services: i. DBSVR, DBSVS, DBS Bank Ltd and/or other affiliates of DBSVUSA may have received compensation, within the past 12 months, and within the next 3 months receive or intends to seek compensation for investment banking services from the company mentioned. DBSVUSA does not have its own investment banking or research department, nor has it participated in any investment banking transaction as a manager or co-manager in the past twelve months. Any US persons wishing to obtain further information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed in this document should contact DBSVUSA exclusively.

3.

ii.

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