INTRODUCTION

The Board of Directors ("the Board") of KKB Engineering Berhad ("the Company" or "KKB") is pleased to announce that the Company has received a Letter of Award from Kuching Water Board ("KWB") for the Proposed Construction, Completion and Commissioning of Water Supply from Jalan Batu Kawa/Matang to and fro Matang Mid-Level Reservoir for Sarawak Water Supply Grid Program - Stressed Areas (Tender Ref.: KWB/T/13/2019).

A formal Contract Agreement shall be executed in due course.

The contract sum for the abovementioned contract is worth approximately RM53 million (Ringgit Malaysia: Fifty Three Million Only).

DURATION OF CONTRACT

The contract period is sixteen (16) months commencing from May 2020, subjected to the final approval by the State Government of Sarawak.

FINANCIAL EFFECTS

The contract will have no effect on the Share Capital of the Company and is expected to contribute positively towards the earnings and net assets of the Company and Group for the duration of the contract.

RISK FACTORS

Risk factors affecting the contract include execution risk such as COVID-19's Movement Control Order, supply chain disruptions and availability of materials, skilled manpower, equipment or specialized machineries, Forex and change in pricing, weather conditions and/or political, economic and regulatory conditions.

DIRECTORS' AND MAJOR SHAREHOLDERS' INTERESTS

None of the Directors and/or major shareholders and/or person connected with them has any interest, direct or indirect in the abovementioned contract.

DIRECTORS' STATEMENT

The Board is of the opinion that the abovementioned contract is in the best interest of KKB and its Group of companies.

This announcement is dated 4 May 2020.