TUN ABDUL RAZAK RESEARCH CENTRE · 2016-11-30 · TUN ABDUL RAZAK RESEARCH CENTRE ANNUALREPORT2015...

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Transcript of TUN ABDUL RAZAK RESEARCH CENTRE · 2016-11-30 · TUN ABDUL RAZAK RESEARCH CENTRE ANNUALREPORT2015...

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TUN ABDUL RAZAK RESEARCH CENTRE

ANNUAL REPORT 2015

1www.tarrc.co.uk

TUN ABDUL RAZAK RESEARCH CENTREA research and promotion centre of the Malaysian Rubber Board

Company registration number: 336256

TARRC, Brickendonbury, Hertford, SG13 8NL, United Kingdom

T: +44 (0)1992 584966 F: +44 (0)1992 554837 E: [email protected]

www.tarrc.co.uk@tarrcuk#TARRC

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The sixth edition of ‘Engineering Design with Rubber’ was produced in 2015.This acclaimed bulletin was first published in 1964 by Dr Peter Lindley and hasbeen updated regularly since then. It covers all aspects of engineering design.

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05 THE BOARD

07 SENIOR STAFF

19 REPORT OF THE DIRECTORS AND STRATEGIC REPORT

32 HIGHLIGHTS OF TARRC PROJECTS

44 ANNUAL FINANCIAL STATEMENTS

44 REPORT OF THE INDEPENDENT AUDITORS

49 NOTES TO THE FINANCIAL STATEMENTS

61 RECONCILIATION OF EQUITY

63 RECONCILIATION OF SURPLUS

64 STAFF LECTURES, POSTERS,WEBINARS & PUBLICATIONS

TARRC ANNUAL REPORT FOR 2015

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TARRC’s Head of Engineering Design, Dr Alan Muhr, won one of the ACS RubberDivision’s Science & Technology Awards – the most prestigious awards availableto rubber professionals. He was presented with the Melvin Mooney DistinguishedTechnology Award at the 187th Technical Meeting, 27th - 30th April 2015 at theHyatt Regency Greenville, South Carolina. Dr Muhr (pictured with the RubberDivision's 2014 first ever female Chair-Elect,Terry Delapa) is the latest in a longline ofTARRC scientists who have won some of the most highly regarded awardsfrom the Rubber Division of the American Chemical Society.

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COMPANY INFORMATIONfor the year ended 31st December 2015

ChairmanDr Mohd Akbar bin Md SaidDirector General of Malaysian Rubber Board, ex-officio(Appointed 24th July 2015)

Datuk Dr Salmiah Ahmad DPSM, FASc, EMBA

Director General of Malaysian Rubber Board, ex-officio(Retired 23rd July 2015)

Vice-ChairmanDato’ Dr Kamarudin Ab-Malek FASc, SMP, FIMM, ARSM

London Representative, Malaysian Rubber Board, ex-officio(Appointed 24th March 2010)

Board MembersDr Stuart CookDirector of Research, ex-officio(Appointed 1st July 2009)

Datuk Abdul Halim HamidAppointed by the Minister of Plantation Industries & Commodities, Malaysia(Appointed 1st January 2012)

Mr Lim Kwee ShyanAppointed by the Minister of Plantation Industries & Commodities, Malaysia(Appointed 1st January 2012, resigned 31st December 2015)

Mr Muhamad Nahar Hj Mohd SidekAppointed by the Minister of Plantation Industries and Commodities, Malaysia(Appointed 1st January 2016)

Dr Abu AmuAppointed by the Minister of Plantation Industries and Commodities, Malaysia(Appointed 1st January 2016)

Dr Zakaria Abd HadiAppointed by the Minister of Plantation Industries & Commodities, Malaysia(Appointed 1st January 2012, resigned 28th January 2015)

Accounts SupervisorZaila Bakar CAT

Registered Office and LaboratoriesTun Abdul Razak Research Centre,Brickendonbury, Hertford, SG13 8NLUnited Kingdom

SolicitorsLongmores

AuditorsWags LLP t/a WagstaffsChartered Accountants and Statutory Auditors

BankersCIMB Bank BerhadBarclays Bank PLC

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as at 31st December 2015ORGANISATION STRUCTURE

Datuk Dr Salmiah Ahmadretired as Chairman of theTARRC Board in 2015.

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SENIOR STAFFFURTHERING ADVANCES IN RUBBER SCIENCEAND ITS APPLICATIONS

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as at 31st December 2015

CEODato’ Dr Kamarudin Ab-Malek DIMP, FASc, SMP, FIMMM, ARSM

Director of ResearchDr Stuart Cook

Head - Industry Support andEngineering Design DivisionHamid Ahmadi MSc

Assistant Company SecretaryMalcolm Harris

Senior Research FellowDr Andy Chapman

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Quality Manager/ SafetyOfficerCharles Stephenson MA

Accounts SupervisorZaila Bakar CAT

IT ManagerDavid Newton BSc

Site ManagerStuart Ballard BEng, CEng

IT AdministratorPrasaj De Silva BSc

Head - Rubber ConsultantsDr Stuart Cook

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Unit HeadKristina Lawson MSc, MBA,

MCLIP

Market Development andPromotionGail Reader BSc

MARKET INTELLIGENCE AND PROMOTION UNIT

Market Development andPromotionDavid Cawthra BA

Market Development andPromotionNorain Tyler BA

Market Development andPromotionSarah Mahyudin BA

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Vibration and Seismic ControlJudith Picken MSci

Rubber FatigueDr Jean-Louis Poisson

Creep/Stress RelaxationRobert Picken MA

Unit HeadDr Alan MuhrCPhys, CEng, MIMMM

Finite Element AnalysisDr Julia Gough

Engineering DesignIan Stephens FIMechIE

Mechanical Properties and TestingDr John Kingston GradIMMM

IINNDDUUSSTTRRYY SSUUPPPPOORRTT AANNDD EENNGGIINNEEEERRIINNGG DDEESSIIGGNN DDIIVVIISSIIOONNENGINEERING DESIGN UNIT

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Development EngineerVincenzo Orlando MSc

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Unit HeadCharles Forge MSc

IINNDDUUSSTTRRYY SSUUPPPPOORRTT AANNDD EENNGGIINNEEEERRIINNGG DDIIVVIISSIIOONNPRODUCT EVALUATION AND TESTING UNIT

Tyre and Testing TechnologistHanna Peltonen MSc

Unit HeadDr Marina Fernando DIC,

FIMMM

Senior Rubber Technologist Colin Robinson HNC

IINNDDUUSSTTRRYY SSUUPPPPOORRTT AANNDD EENNGGIINNEEEERRIINNGG DDEESSIIGGNN DDIIVVIISSIIOONNINDUSTRIAL SUPPORT UNIT

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Unit HeadPaul Brown MA

Thermoplastic Vulcanisates/Tyre CompoundsJaymini Patel BSc, CEng, MIMMM

Atomic Force MicroscopyDr Anna Kepas-Suwara

NanocompositesDr David Lowe

Tyre CompoundsDr Pamela Martin

Tyre Compounds/Novor Graham Spiller BSc

MMAATTEERRIIAALLSS AANNDD BBIIOOTTEECCHHNNOOLLOOGGYY DDIIVVIISSIIOONNADVANCED MATERIALS AND PRODUCT DEVELOPMENT UNIT

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Unit HeadDr Maria Kolesnikova-Allen

Deputy HeadDr Alessandra Di Cola

Plant Genomics Dr Ishtiaq Khaliq

Plant GenomicsRachel Greenhill BSc

BioinformaticianEwan Mollison MSc

MMAATTEERRIIAALLSS AANNDD BBIIOOTTEECCHHNNOOLLOOGGYY DDIIVVIISSIIOONNBIOTECHNOLOGY UNIT

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BioinformaticianDr Christopher Middleton

Plant ProteomicsDr Nurul Siddiqui

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Unit HeadPaul Gugan BSc

Spectroscopy and Thermal AnalysisColin Hull BSc

MicroscopyDr Robin Davies

Spectroscopy and Thermal AnalysisTeodora Da Silva BSc

SpectroscopySusanna Mathys MSc

Pharmaceuticals Extractablesand LeachablesAnna Benton BSc

MMAATTEERRIIAALLSS AANNDD BBIIOOTTEECCHHNNOOLLOOGGYY DDIIVVIISSIIOONNMATERIALS CHARACTERISATION UNIT

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Liquid ChromatographyDhiren Heisnam MSc

ISO Testing Gemma Channon MSc

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Extractables and LeachablesChromatography Leighton James BSc

Liquid ChromatographyJolanta Bonfante MSc

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MAIN OFFICES:MARKETING & PROMOTION

ADMINISTRATIONRUBBER CONSULTANTS

TARRCBrickendonburyHertfordshire, UK

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BIOTECHNOLOGY

TYRE TESTING

PHYSICAL TESTING

INDUSTRIAL SUPPORT

TYRE RETREADING

ENGINEERING DESIGN

MILL ROOM

ANALYTICAL & MATERIALSLABORATORIES

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Datuk Dr Mohd Akbar bin Md Said

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REPORT OF THE DIRECTORS ANDSTRATEGIC REPORT

CHAIRMAN’S STATEMENT

In my first full year as Chairman of the TARRC Board, Ihave gained a more detailed understanding of theresearch centre’s importance to the development andsustainability of the Malaysian rubber industry (MRI).The scientific quality of TARRC’s research programmeover many years has resulted in ground breakingdevelopments such as seismic rubber bearingtechnology, rubber tree genome sequencing and newsustainable materials based on natural rubber. TARRChas been a key player in raising the profile of the MRIglobally in many diverse sectors such as civilengineering, automotive, healthcare and bioscience.TARRC is renowned as an innovative and collaborativeresearch organisation and scientists continue to berecognised for excellence in their field.

I am pleased to witness the commercialisation of severalresearch outcomes, particularly the success of TARRC’snatural rubber-based fire retardant material, Natural-FR.Entrance matting made from this compound has nowbeen installed in six London Underground and Crossrailstations and this number is expected to increase in 2016.Material fire performance requirements in the rail sectorare very stringent and with companies prioritisingsustainability as well as safety, the rail industry in generalis an excellent business opportunity for NR-basedproducts. I look forward to further success with thecoloured Natural-FR compound, which has also nowpassed the EU fire safety requirements that will enableus to explore new markets.

Latex-T, the diagnostic test for allergenic proteins inlatex rubber products, is progressing towardscommercialisation. I am pleased that our researchershave been recognised with the award of a Gold Medalat the 26th International Invention and InnovationExhibition (ITEX) in Kuala Lumpur, Malaysia and I’m amsure this will encourage them in their drive to bringLatex-T to market and make a real impact on theefficiency of quality control in the latex productmanufacturing industry.

TARRC’s expertise in base isolation technology has led toseveral contracts to support and provide technicalassistance to bearing manufacturers in their bid for highprofile major structural projects in earthquake-proneregions. Our reputation in this area is well established,and I can see that TARRC’s younger engineers arefollowing in their project leaders’ footsteps with thesame dedication and commitment. This is particularlytrue in the undertaking of one of TARRC’s mostambitious projects to date: the new seismic test facility.

TARRC’s own ‘megaproject’ is well underway and I canforesee this facility assisting Malaysian bearingmanufacturers to obtain the essential CE markingcertification necessary for capturing more business inthe growing European market.

I am pleased to see the growing interest and awarenessof EkoprenaTM among the major global tyremanufacturers and an increase in the amount of thisspecialty NR-based Malaysian material that is beingsupplied for trials and research. It is important thatTARRC’s tyre technologists continue with their researchto optimise compounds and to provide data to supportthe promotion of the use of Ekoprena by the tyreindustry. Good collaboration with the tyremanufacturers and material suppliers is essential for thesuccess of this project and I am encouraged to see closerrelationships with the industry growing year by year.

TARRC and the Malaysian rubber industry continue tobecome more visible in key market sectors in the Westthrough marketing activities to promote Malaysia as asupplier of the highest quality, competitive rubberproducts and materials. The total known value ofbusiness generated with TARRC’s assistance reachedalmost RM40 million in 2015. Often a key factor insecuring new contracts has been customersreassurance knowing they have the support frommarketing and technical staff based at Brickendonbury.TARRC has built excellent relationships with theMalaysian industry through the factory improvementA5 programme and marketing visits, and it isheartening to receive such positive feedback frommanufacturers as their businesses grow.

TARRC is uniquely placed to support and promote theindustry in Malaysia as the global centre for rubber. Theresearch centre’s world-class research, highly skilledpeople and state-of-the-art facilities will ensure thatresearch excellence will continue to be Malaysia’scompetitive advantage. I am confident that thedevelopment of clear strategies for future researchprogrammes will assist the MRI to reach its fulleconomic potential.

Datuk Dr Mohd Akbar bin Md SaidChairmanTun Abdul Razak Research Centre

for the year ended 31st December 2015

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DIRECTORS

The directors shown below have held office during thewhole of the period from 1st January 2015 to the dateof this report.

Dato’ Dr Kamarudin Ab-MalekDr Stuart CookDatuk Abd Halim Hamid

Other changes in directors holding office are as follows:

Datuk Dr Salmiah Ahmadresigned 23rd July 2015

Datuk Dr Mohd Akbar bin Md Saidappointed 24th July 2015

Dr Zakaria Abd Hadiresigned 28th January 2015

Mr Lim Kwee Shyanresigned 31st December 2015

Mr Muhamad Nahar Hj Mohd Sidekappointed 1st January 2016

Dr Abu Amuappointed 1st January 2016

The Board met three times during 2015 totransact business.

The seventy-seventh Annual General Meeting ofTARRC was held on 13th October 2015.

PRINCIPAL ACTIVITIES

The Tun Abdul Razak Research Centre (TARRC) is anorganisation and research centre of the MalaysianRubber Board (MRB). Incorporated in England since1938, TARRC is a Company Limited by Guarantee andnot having a share capital, the word ‘Limited’ beingomitted by Licence of the Department of Trade andIndustry. TARRC, by reason of the definition in Section1(1) of the Companies Act 1980 and the bringing intoforce of Part 1 of that Act, became a Private Companyon 22nd December 1980.

The core objectives of TARRC are to undertake:

• specialised R&D focusing particularly on rubber inengineering applications;

• development of sustainable advanced materials andproducts;

• biotechnology activities; • transfer of technology to the Malaysian rubber

manufacturing industry; • commercialisation of R&D outcomes; • promotion of Malaysian manufactured rubber-

based materials and products; • FDI opportunities in the Malaysian rubber industry; • training for personnel both from the MRB and the

industry in Malaysia; • consultancy services to generate income.

All these activities involve the publishing anddistribution of associated scientific, technical andpromotional literature. Participation in internationalmeetings, conferences, seminars and exhibitions arealso important activities to encourage the expansion ofmarkets for Malaysian rubber products and materials aswell as for MRB’s commercial technologies. Cleartargets are set for income generation and in keepingwith this policy, the Board charged the Director ofResearch and Staff to continue to enhance incomethrough exploitation of TARRC’s scientific resources,expertise and commercialisation of its R&D findings toincrease its degree of self-financing. Turnover fromRubber Consultants in 2015 was £891,856.

REVIEW OF BUSINESS

TARRC continues to support and develop the Malaysianrubber industry with its R&D programme covering awide range of projects in three key areas:

• new sustainable NR-based rubber materials andproducts;

• engineering applications; • biotechnology.

To support these, the marketing team’s activitiespromote and raise awareness of the Malaysian industryas well as TARRC and the Malaysian Rubber Board.

REPORT OF THE DIRECTORS ANDSTRATEGIC REPORT

for the year ended 31st December 2015

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Some key highlights from 2015 include:

Commercialisation of TARRC’s fire-retardant NR-based material Natural-FR TARRC’s Natural-FR black compound passed both theEU standard for fire behaviour of materials andcomponents in rail applications and the more stringentBritish Standard smoke density test. The mixing of thecompound was successfully scaled up to industrial scaleand it is now being supplied commercially to a UKentrance matting supplier to London Underground. Bythe end of 2015, six different installations had takenplace in London Underground and Crossrail stations.

The trial mat installed in 2014 at Warren Street stationcontinues to show better wear performance than thecurrent use synthetic rubber entrance matting after 15months in service.

A more streamlined supply chain for producingNatural-FR compound was well under way by the endof the year.

Work is progressing well to commercialise a colouredNatural FR compound. The coloured version has alsoachieved the highest classification under the EUstandard at 6mm thickness. Further studies will explorethe flame retardant behaviour of thinner flooring thatwould open the market potential for alternativeapplications.

Media coverage following participation at the ACSRubber Division conference and exhibition in Nashville,USA in 2014 resulted in an article in Rubber and PlasticsNews on the development of Natural-FR. An article wasalso published in MRB Technology Developmentsin 2015.

Green tyre technology and promotion to further theuse of EkoprenaFurther collaboration with major tyre manufacturersand suppliers of filler materials continued during theyear. Technical advice on large scale mixing has beenoffered to several companies to highlight theimportance of the technical aspects of the precisemixing procedure. Improvements in the cure systemused for Ekoprena/silica filled tread compounds, thathave the potential to reduce costs are expected toimprove the receptiveness of tyre manufacturers toEkoprena based compounds.

Bus service trials in Malaysia of Ekoprena blendcompounds, developed between a Malaysian retreadmanufacturer and the Malaysian Rubber Board,demonstrated up to 25% reduced rolling resistanceand close to a 20% lower wear rate compared with acontrol compound.

Further studies to elucidate tyre wear mechanismscontinue with the aim of developing a laboratorytesting system to better replicate service wear.

Two papers were presented at the conference TireTechnology Expo 2015 in Cologne as well asparticipation at the exhibition with a stand promotingEkoprena and TARRC’s consultancy services. The standattracted a record number of enquiries for Ekoprenacompared with the previous ten years of participation.Two papers were presented at the ACS Rubber Divisionspring and fall meetings.

Biotechnology activitiesA new project commenced in 2015 which focusses onbringing TARRC’s prototype diagnostic test kit to checkthe allergenic potential of latex products, Latex-T, to thenext level of development towards commercialisation.

TARRC participated at the International RubberConference and Trade Exhibition in Nuremberg,Germany and the 26th International Invention andInnovation Exhibition (ITEX) in Kuala Lumpur, Malaysia.Both exhibitions resulted in more enquiries and interestduring the year from international companiesmanufacturing a range of latex-based productsincluding mattresses, gloves and toys. Interestedparties have been provided with sample test kits fortrial and feedback. At ITEX, the combined TARRC andMRB project team was awarded a gold medal for thedevelopment of the Latex-T kit.

A prototype 25 Single Nucleotide Polymorphism (SNP)marker panel for clonal identification of Hevea plantingmaterials had been established. This set will bevalidated on the Hevea germplasm collection andbefore being evaluated for its effectiveness on existingbreeding populations and planting materials.

As a result of the addition of a BLAST tool to the existingHevea Genome Browser, it has become possible toperform BLAST searches of known sequences within theMRB genome assembly, USM and other publicdatabases. The system is double password protected

REPORT OF THE DIRECTORS ANDSTRATEGIC REPORT

for the year ended 31st December 2015

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Above: TARRC welcomed a visit to Brickendonbury from Datuk Wilfred Madius Tangau(second left), Malaysia's Minister of Science, Technology and Innovation (MOSTI)on Saturday 5th September.

Below: TARRC’s Director of Research Dr Stuart Cook talks to Dr Zuhairi Abd Hamid,Executive Director of Construction Research Institute of Malaysia (CRIM), on a tour ofour laboratories when they visited Brickendonbury on 17th March 2015.

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Above: TARRC’s biotechnology team along with their research partners at the Malaysian Rubber Board won a GoldMedal at the 26th International Invention and Industry Design and Technology Exhibition (ITEX 2015), held at theKuala Lumpur Convention Centre from 21st to 23rd May 2015. In recognition of the award for the invention ofthe Latex-T test kit, TARRC’s Director of Research, Dr Stuart Cook, presented Dr Maria Kolesnikova-Allen (left)and Dr Alessandra Di Cola with their ITEX 2015 Gold Medals and certificates at Brickendonbury.

TARRC was pleased to showcase the awardwinning Latex-T test kit on the Wurfbain standat DKT 2015/IRC 2015 from 29th June - 2nd Julyin Nuremberg, Germany.

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anywhere in the world. Several projects at TARRC andMRB are already benefiting from information availablethrough the Browser.

A new state-of-the-art technology has been adoptedin the Biotechnology Unit: Real Time qPCR. Thistechnology is the method of choice for nucleic acid(DNA, RNA) quantification in all areas of molecularbiology. It is, in contrast to the conventional PCR,quantitative, meaning that the exact concentration ofthe amplified DNA in the sample can be determined.The technology will be used for quantitative assessmentof individual genes’ performance in organisms, studiesof dynamic changes in genes’ behaviour in real time,precise calculations of gene copies number variationand other applications.

Engineering product designOne of the Unit’s key projects to promote seismicisolation technology continues to progress well. Eightpapers were presented at the 9th European Conferenceon Constitutive Models for Rubbers (ECCMR IX), Prague(Czech Republic), SECED 2015 (Society for Earthquakeand Civil Engineering Dynamics), Cambridge (UK) and14th World Conference on Seismic Isolation, EnergyDissipation and Active Vibration Control of Structures(14WCSI), California (USA).

TARRC’s elastomeric joint specially designed forearthquake protection of masonry infill in reinforcedconcrete frame structures was presented at the Italianbuilding exhibition SAIE smart house, held in Bologna.The prototype wall designed under the Europeanproject INSYSME (Innovative Systems for EarthquakeResistant Masonry Enclosures in brick infill buildingswith reinforced concrete frames) was on display at SAIEand this incorporated TARRC’s innovative rubber walljoint. A patent application was lodged in 2014 and theexamination phase is nearing completion.

The commercialisation of TARRC-designed ViscoelasticEnergy Dissipation Devices (VEDDs) to protect new andexisting buildings from damage during earthquakescontinues. Testing and optimisation of the devices ismaking good progress and potential pilot projects havebeen identified.

A major project to assemble and commission a newseismic bearing test facility has involved substantialdemolition work of existing laboratory facilities to createthe large area required for the new testing laboratory.The design of the test facility was completed in 2014 andin 2015 identification and selection of suppliers andsubcontractors began through the tender process. Allparts and equipment required for the machine havebeen designed, sourced and purchased in 2015.

TARRC’s Head of Engineering Design, Dr Alan Muhr,won one of the ACS Rubber Division’s Science &Technology Awards – the most prestigious awardsavailable to rubber professionals. He was presentedwith the Melvin Mooney Distinguished TechnologyAward at the 187th Technical Meeting April 27th-30th,2015 in Greenville, SC, USA.

The sixth edition of ‘Engineering Design with Rubber’was published. This acclaimed bulletin was firstproduced in 1964 as ‘Engineering Design with NaturalRubber’ by Dr Peter Lindley and has been updatedregularly since then. It covers all aspects of engineeringdesign.

Marketing and promotion activitiesNew business was achieved for Malaysianmanufacturers with an estimated value of RM40 millionin 2015. Under the Market Intelligence and PromotionUnit, TARRC was represented at seven exhibitionscovering the automotive, industrial subcontracting, rail,tyre and general rubber sectors. The consultancyservices of TARRC were also promoted at each event. Avisit was to Malaysia by a member of the Unit to gainfurther understanding of manufacturers’ needs andcapabilities as well as to inform them of marketopportunities in the West.

The Unit completed the design and printing of TARRC’sstationery requirements and the preparation of theAnnual Report, as well as promotional and technicalmaterial for other Units and Rubber Consultants.

TARRC, Rubber Consultants and Brickendonburywebsites were updated with current news storiesthroughout the year. Social media activities continuedto result in more contacts, particularly with the pressthat have led to requests for interviews with scientistsand published articles.

REPORT OF THE DIRECTORS ANDSTRATEGIC REPORT

for the year ended 31st December 2015

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TARRC exhibited at Tire Technology Expofor the eighth consecutive year, in Cologne,Germany from 10th-12th February 2015.TARRC showcased Malaysia's renewablenatural rubber based material, EKOPRENAon stand 6100. EKOPRENA is a sustainablespeciality natural rubber material, producedin Malaysia, used as a replacement forsynthetic rubber in tyres. EKOPRENA tyrecompounds demonstrate groundbreakingperformance in terms of low rollingresistance and high wet grip.

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The Rubber Consultants stand at Tire Technology Expo 2015 in Cologne, Germany from 10th-12thFebruary 2015. Services from Rubber Consultants were promoted including the comprehensive tyretesting facilities and analytical PAH testing for tyre materials according to ISO 21461 (UKAS accredited).Insert: The TARRC Team on the Rubber Consultants stand at Tire Technology Expo 2015.

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Project A5 – The Key to SuccessThis project to assist and support Malaysian rubberproduct manufacturers in improving their quality,productivity and efficiency performance towardsachieving global standards made 17 factory visits in 2015that included eight companies new to the programme.

Main achievements included:

• 100% productivity improvement in camel backproduction at a retread manufacturer;

• 45% productivity improvement in a compressionmoulded product;

• 50% increase in output at an extrusionmanufacturer;

• Introduction of single stage mixing of an EPDMextrusion compound giving additional outputcapacity of 60 tonnes per month and cost savingof 20%;

• Several companies asking for technical supportaside from A5 activity;

• Compound development support.

Investment in new equipmentA new semi-automated rubber mixer, a CBI-55 Intermix,a 55 litre machine was installed in 2015. The mixer canprovide mixed batch weights of around 45kg – almost50% more than TARRC could handle previously. Itsignificantly improves the capability for rubbercompound development in general and is ideally suitedfor small-scale tyre trials.

TARRC has added to its comprehensive tyre testingfacilities with the purchase of a new 2-stationpassenger test rig with force and moment andendurance hubs. The force and moment station has amaximum speed of 250kph speed and can carry outforce and moment measurements that are used toidentify tyre performance characterisations andprovide insight into how a tyre’s design affects overallvehicle dynamics.

New dynamic test equipment to enhance TARRC’scapabilities in the characterisation of the physicalproperties of viscoelastic materials was acquired duringthe year. The Metravib DMA+1000, DynamicMechanical Analyser allows characterisation ofmaterials in terms of their strain, frequency,temperature and time dependent properties. Thesecond piece of equipment, a Metravib DMA+2000,replaces two aged Goodrich flexometers and has the

capability to test to ISO 4666-3 standard, and is used todetermine the temperature rise and resistance tofatigue of vulcanised rubber materials. Together, thesetwo pieces of equipment can test the requiredproperties of elastomeric materials and componentsusing advanced technology and high precision,analytical techniques.

PRINCIPAL RISKS AND UNCERTAINTIES

The Directors believe that the risks and uncertaintiesdescribed below are the ones that may have the mostsignificant impact on the long term future ofTARRC. The list that is presented is not intended tobe exhaustive.

FundingTARRC’s principle source of funding is derived from thecontribution from its Malaysian parent company, theMalaysian Rubber Board. The economic climateprevailing at any time in Malaysia may affect the futureability of the MRB to provide funds for TARRC.Research and development activities at TARRC aredirected at increasing the level of internally generatedincome through commercialisation of technologies,products and the provision of consultancy servicesby TARRC.

PensionsIncreased liability values and reduced financial returnsfrom assets held by the pension fund may increase thesize of the pension deficit. De-risking strategies, toreduce the longer term deficit have beenimplemented and management regularly review thestatus of the pension funds and remain committed toappropriate action. Discussions are ongoing with theTrustees and the Pensions Regulator to determine astrategy for funding the existing deficit in line withbusiness objectives.

Recruitment, development or retention oftalented peopleRecruitment of highly qualified and skilled staff,particularly scientific staff is a growing problem forcompanies both in the UK and EU. TARRC aims toprovide an excellent environment for scientific researchto flourish. The retirement of highly experienced staffcontinues to present challenges and so to providefuture continuity, the further development of younger,talented staff remains an important objective.

REPORT OF THE DIRECTORS ANDSTRATEGIC REPORT

for the year ended 31st December 2015

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Monitoring of the reward and benefits that TARRC isable to offer new and current employees continues tobe undertaken so that appropriate actions may betaken to ensure TARRC maintains its place in a verycompetitive employment market.

Investment in technology, equipment and marketing activities Continued investment in new technology andequipment is required to maintain TARRC’s position asone of the world’s foremost rubber researchlaboratories and to ensure that TARRC is able to fulfil itscore objectives. Recent levels of investment from theMRB has enabled the acquisition of cutting edgeequipment which together with targeted recruitment inrecent years, has enabled TARRC to be well placedto make advances in new scientific fields and todevelop new commercial opportunities. Marketing andpromotional activities will continue to be essential toensure that the impact of TARRC’s output is maximised,both in Europe and the US, as well as in Malaysia andSouth East Asia.

Continuity of site facilities and servicesTARRC has appropriate Health & Safety policies in placeto ensure that safe working practices are maintainedfor both staff and facilities. Improvements in powersupply and IT provision, together with appropriateinsurance arrangements being in place will ensure thatthe laboratory facilities are able to continue to function,or be brought back into a fully functioning conditionwith minimal delay as a result of external events.

SENIOR STAFF AS AT 31ST DECEMBER 2015

During the year two appointments were made; therewas one dismissal, two resignations and one memberretired. The total senior staff strength on 31st December2015 was 47.

SUPPORTING STAFF AS AT 31ST DECEMBER2015

During the year no supporting staff were appointed.There were two resignations, one dismissal and three

retirements. The total number of supporting staff as at31st December 2015 was 37.

STAFF LECTURES AND PUBLICATIONS

During 2015 34 lectures, two posters and one webinarwere given and 26 scientific and technological papers orproceedings were published.

FINANCE

The Financial Statements, Notes to the FinancialStatements, Reconciliation of Equity and Reconciliationof Surplus are presented on pages 44 to 63. In theopinion of the Board, the current market value ofTARRC's freehold properties is in excess of the net bookvalue shown in the Balance Sheet.

FINANCIAL RISK MANAGEMENT OBJECTIVESAND POLICIES

The company’s operations expose it to a variety offinancial risks that include the changes in debt marketprices, credit risk, liquidity risk, interest rate risk andforeign exchange rate risk. The company has in place arisk management programme that seeks to limit theadverse effects on the financial performance of thecompany by monitoring the levels of debt finance andthe related costs. The company does not use derivativefinancial instruments to manage interest rate costs andas such, no hedge accounting is applied.

Given the size of the company, the directors have notdelegated the responsibility of monitoring financial riskmanagement to a sub-committee of the board. Thepolicies set by the board of directors are implementedby the company’s finance department. The departmenthas a policy and procedures manual that sets out thespecific guidelines to manage interest rate risk, creditrisk and foreign exchange risk and circumstances whereit would be appropriate to use financial instruments tomanage these.

REPORT OF THE DIRECTORS ANDSTRATEGIC REPORT

for the year ended 31st December 2015

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STATEMENT OF DIRECTORS’RESPONSIBILITIES

The directors are responsible for preparing the Reportof the Directors and the financial statements inaccordance with applicable law and regulations.

Company law requires the directors to prepare financialstatements for each financial year. Under that law thedirectors have elected to prepare the financialstatements in accordance with United KingdomGenerally Accepted Accounting Practice (UnitedKingdom Accounting Standards and applicable law).Under company law the directors must not approve thefinancial statements unless they are satisfied that theygive a true and fair view of the state of affairs of thecompany and of the surplus or deficit of the companyfor that period. In preparing these financial statements,the directors are required to:

- select suitable accounting policies and then applythem consistently;

- make judgements and accounting estimates that arereasonable and prudent;

- prepare the financial statements on the goingconcern basis unless it is inappropriate to presumethat the company will continue in business.

The directors are responsible for keeping adequateaccounting records that are sufficient to show andexplain the company’s transactions and disclose withreasonable accuracy at any time the financial positionof the company and enable them to ensure that thefinancial statements comply with the Companies Act2006. They are also responsible for safeguarding theassets of the company and hence for taking reasonablesteps for the prevention and detection of fraud andother irregularities.

STATEMENT AS TO DISCLOSURE OFINFORMATION TO AUDITORS

So far as the directors are aware, there is no relevantaudit information (as defined by Section 418 of theCompanies Act 2006) of which the company's auditorsare unaware, and each director has taken all the stepsthat he ought to have taken as a director in order tomake himself aware of any relevant audit informationand to establish that the company's auditors are awareof that information.

AUDITORS

The auditors, Wags LLP t/a Wagstaffs, are deemed to bereappointed in accordance with Section 487(2) of theCompanies Act 2006.

ON BEHALF OF THE BOARD:

Dr Stuart Cook - Director

Date: 8th September 2016

REPORT OF THE DIRECTORS ANDSTRATEGIC REPORT

for the year ended 31st December 2015

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PROJECT 2: NEW DURABILITY PREDICTION METHODOLOGY FOR RUBBER PRODUCTS IN THEENERGY

This new project aims to develop and improve experimental and simulation methods for predicting the lifetime ofrubber components.

PROJECT 3: DEVELOPMENT AND EVALUATION OF SMART MOUNTING SYSTEM DESIGN

A new and innovative adaptive mount based on TARRC’s magnetorheological switch has been developed. This projectwill provide increased revenue for MRB through commercialisation of R&D findings.

PROJECT 4: APPRAISAL OF SEISMIC BEARING TESTING FACILITY FOR CE MARKING

This major project to build a new seismic bearing test facility is well underway and as well as redevelopment of theproposed site taking place, all parts and equipment required for the machine were designed, sourced and purchasedin 2015.

PROJECT 5: COMMERCIALISATION OF VISCOELASTIC ENERGY DISSIPATIVE DEVICES (VEDDS)

The commercialisation of TARRC-designed Viscoelastic Energy Dissipation Devices (VEDDs) to protect new and existingbuildings from damage during earthquakes continues. Testing and optimisation of the devices is making good progressand potential pilot projects have been identified.

TARRC’s key project to promote seismic isolationtechnology continues to progress well. Eight paperswere presented in 2015 at the 9th European Conferenceon Constitutive Models for Rubbers (ECCMR IX), Prague(Czech Republic), SECED 2015 (Society for Earthquakeand Civil Engineering Dynamics), Cambridge (UK) and14th World Conference on Seismic Isolation, EnergyDissipation and Active Vibration Control of Structures(14WCSI), California (USA).

TARRC’s innovative elastomeric wall joint speciallydesigned for earthquake protection of masonry infill inreinforced concrete frame structures was presented atthe Italian building exhibition SAIE smart house, held inBologna. The prototype wall designed under theEuropean project INSYSME (Innovative Systems forEarthquake Resistant Masonry Enclosures in brick infill

buildings with reinforced concrete frames) was ondisplay at SAIE and this incorporated TARRC’s novelrubber wall joint.

The technical promotion of the Rolling Ball DissipativeLayer Isolation System (RBDL Isolation System) whichprovides a versatile and economical means ofprotecting light structures from earthquakes, continuedthroughout the year.

A major project to assemble and commission a newseismic bearing test facility has involved substantialredevelopment of existing laboratory facilities to createthe large area required for the new testing laboratory.Identification and selection of suppliers andsubcontractors began through the tender process in 2015.

ENGINEERING

PROJECT 1: TECHNICAL PROMOTION OF ANTI-SEISMIC DEVICES

HIGHLIGHTS OF TARRC PROJECTS

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TARRC’s Head of Industry Support and EngineeringDivision Hamid Ahmadi at the Italian buildingexhibition SAIE smart house, held in Bologna from14th – 17th October 2015. The prototype wallincorporates an innovative rubber wall joint designedand developed for the seismic protection of themasonry infill by scientists from the Engineering DesignUnit at TARRC with earthquake engineering input fromNumeria Consulting Engineers, Italy. Manufacturing ofthe joints, for testing and demonstration, has takenplace at TARRC laboratory in Brickendonbury. Insert:The rubber wall joint.

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TARRC’s 2-station passenger test rig withforce and moment and endurance hubs.

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ADVANCED MATERIALS

PROJECT 1: GREEN TYRE TECHNOLOGY BASED UPON EKOPRENA

Collaboration with major tyre manufacturers andsuppliers of filler materials continued through the year.Technical advice on large scale mixing has beenprovided to several companies to highlight theimportance of the technical aspects of the precisemixing procedure. Improvements in the cure systemused for Ekoprena/silica filled tread compounds, thathave the potential to reduce costs are expected toimprove the receptiveness of tyre manufacturers toEkoprena based compounds.

A new tyre cement, based upon Ekoprena, was used toprepare precured retreaded commercial vehicle tyresusing the treads produced during the factory mixingtrials at Kraiburg, Austria in late 2014. Service trials ofthese treads under severe conditions show that the all-Ekoprena tread compound is matching the wear

performance of TARRC’s premium grade NR/BRretread compound.

Further studies to elucidate tyre wear mechanismscontinue with the ultimate aim of developing a laboratorytesting system to better replicate service wear.

Two papers were presented at the conference Tire TechExpo 2015 in Cologne as well as participation at theexhibition with a stand promoting Ekoprena and theconsultancy services. The stand attracted a recordnumber of enquiries for Ekoprena, more than in any ofthe previous ten years of participation. Two paperswere presented at the ACS Rubber Division spring andfall meetings.

PROJECT 2: EVALUATION OF EVOPRENA

This project is compiling technical data generated over a range of service conditions, necessary to assist the promotionof Evoprena (a new grade of Malaysian NR) in the tyre industry. Wear service trials so far are producing promisingresults with the Evoprena matching or bettering the SMR 10 control in low severity applications.

PROJECT 3: TECHNICAL PROMOTION OF EKOPRENA IN TYRES

This project promotes the results of other Ekoprena projects directly to the tyre industry by direct contact with tyreand suppliers to the tyre industry as well as participation in international exhibitions and conferences. TARRC isestablishing itself as the European base of the promotion of Ekoprena to the global tyre industry. A book entitled‘Turning Tyres Green’ on the role of natural rubber in green tyre technology was written during the year.

PROJECT 4: TYRE TESTING

TARRC performs laboratory drum tests and wear trials, both on vehicle and using trailers to support the research anddevelopment activities of the MRB and offers these facilities to the tyre industry and its suppliers through theconsultancy. A new 2-station passenger test rig with force and moment and endurance hubs was purchased duringthe year.

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PROJECT 2: DEVELOPMENT OF SINGLE NUCLEOTIDE POLYMORPHISM (SNP) MARKERS FORHEVEA BRASILIENSIS

A set of molecular markers is being developed based on Single Nucleotide Polymorphisms (SNPs) that would besuitable to be used in an array to enable the rapid identification of individual Hevea clones.

PROJECT 3: TARGETED ANNOTATION OF HEVEA BRASILIENSIS GENOME

This project takes a more targeted approach to genome annotation following the global annotation of the Heveabrasiliensis genome. It will result in the identification of genes/regulatory elements associated with traits ofcommercial importance.

PROJECT 4: ACCELERATION OF HEVEA BRASILIENSIS BREEDING PROGRAMMES THROUGH THEDISCOVERY AND VALIDATION OF SNP MARKERS

A comprehensive genetic resource based on a Reference Draft Genome Sequence of Hevea brasiliensis is beingassembled and a panel of SNP markers for rapid and definitive clonal identification of Hevea plants is being established.

PROJECT 5: STUDY OF GENE EXPRESSION AND PROTEIN CHANGES IN HEVEA BRASILIENSISINFECTED WITH RIGIDIPOROUS MICROPORUS (WHITE ROOT ROT DISEASE)

Work is in progress to identify the genes and proteins associated with this fungal infection that will lead to theidentification of biomarkers that could be used for the detection of the pathogen at early stage of infection.

PROJECT 6: HEVEA BRASILIENSIS ROOT TRANSCRIPTOME, A NEW PLATFORM FOR THEIDENTIFICATION OF BIOTIC AND ABIOTIC DEFENCE-RELATED GENES

A map of the genes expressed in the Hevea brasiliensis root system during the course of infection is being constructedin order to investigate and subsequently improve the tolerance to soil-borne pathogens responsible for diseasesspecifically affecting the root tissue.

BIOTECHNOLOGY

PROJECT 1: LATERAL FLOW DIAGNOSTIC KIT FOR LATEX ALLERGEN

A new project commenced in 2015 which focusses onbringing TARRC’s prototype diagnostic test kit forassessing the allergenic potential of latex products,Latex-T, to the next level of development towardscommercialisation. The kit detects two major latexallergens and now needs validation to move into acommercialisation phase. Development of the nextgeneration of kits continued in 2015 alongsidemarketing and promotion activities.

During the year TARRC participated at the InternationalRubber Conference and Trade Exhibition in Nuremberg,Germany and the 26th International Invention andInnovation Exhibition (ITEX) in Kuala Lumpur, Malaysia.Both exhibitions resulted in more enquiries and interestduring the year from international companiesmanufacturing a range of latex-based productsincluding mattresses, gloves and toys. Interested

parties have been provided with sample test kits fortrial and feedback. At ITEX, the combined TARRC andMRB project team was awarded a gold medal for thedevelopment of the Latex-T kit.

Dr Alessandra Di Cola was invited to give a talk titled‘Lateral Flow Diagnostic Kit for Latex Allergens’ at the3rd Advanced Materials in Healthcare Conference inCleveland, Ohio. The conference was part of theprestigious International Rubber & Advanced Materialsin Healthcare Expo, organised by the Rubber Division ofthe American Chemical Society. Sample kits andliterature were also displayed on TARRC’s stand at theexhibition. There was great interest in the Latex-T kitsfrom industry and the media. Several interviews withthe press were given including the magazines Rubberand Plastics News and Rubber World.

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TARRC’s biotechnology projects to identify thegenes and proteins associated with white root rotdisease involves taking samples of leaves and seedsfrom various Hevea brasiliensis clones.

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In 2015 TARRC installed a new automated mixer, a CBI-55 Intermix,a 55 litre machine that can provide mixed batch weights of around45kg - almost 50% more than we could handle previously. The mixerhas a hydraulic ram with variable ram pressure and positional control,variable rotor speed 0 to 50rpm, 3 zone closed loop tempered coolingwater, automated injection of carbon black and process oil, computercontrol of weighing and mixing operations, and batch traceability.

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PROJECT 2: A5 PROGRAMME – THE KEY TO SUCCESS

The A5 programme offers manufacturers free and confidential support and assistance with day to day product andprocess issues with the overall aim of reducing operating costs and improving competitiveness.

PROJECT 3: MALAYSIAN RAW RUBBER AND RUBBER PRODUCT SUPPORT

This is a service project that provides technical advice in response to enquiries concerning the use of Malaysian rawrubber and rubber products.

PROJECT 4: MILL ROOM SERVICES

This is a service project to support TARRC R&D and Rubber Consultants contracts.

INDUSTRY ASSISTANCE

PROJECT 1: COMMERCIALISATION OF TARRC’S FIRE-RETARDANT NR-BASED MATERIALNATURAL-FR

TARRC’s Natural-FR black compound passed both theEU standard for fire behaviour of materials andcomponents in rail applications and the more stringentBritish Standard smoke density test. The mixing of thecompound was successfully scaled up to industrial scaleand it is now being supplied commercially to a UKentrance matting supplier to London Underground. Bythe end of 2015, six different installations had takenplace in London Underground and Crossrail stations.

The trial mat installed in 2014 at a central Londonstation continues to show better wear performancethan the current use synthetic rubber entrance mattingafter 15 months in service.

A more streamlined supply chain for producingNatural-FR compound was being put together to makethe Natural-FR compound more cost effective to assistits uptake.

Work is progressing well to commercialise a colouredNatural-FR compound. The coloured version has alsoachieved the highest classification under the EUstandard at 6mm thickness. Further studies willexplore the flame retardant behaviour of thinnerflooring that would open the market potential foralternative applications.

Press coverage following participation at the ACSRubber Division conference and exhibition inNashville, USA in 2014 resulted in an article in Rubberand Plastics News on the development of Natural-FR.An article was also published in Malaysian RubberTechnology Developments in 2015 and also in‘Stretch’ the Malaysian Rubber Export PromotionCouncil publication.

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PROMOTION AND SERVICE PROJECTS

PROJECT 1: PROMOTION OF THE MALAYSIAN RUBBER INDUSTRY AND THE SERVICES OF TARRCAND THE MRB

This project aims to increase awareness in the West ofthe Malaysian Rubber Industry (MRI), increaseawareness globally of the technical expertise of TARRCand the MRB and to promote TARRC’s consultancyservices.

TARRC, with its strategic location in Europe, can act as atrade and investment route with technical support tothe MRI, as well as perform cost-effective marketingand PR activities on behalf of the industry and the MRB.

TARRC has represented MRB and the Malaysian RubberIndustry and promoted the services of Rubber

Consultants at the following exhibitions during 2015,taking almost 400 enquiries on the stands:

• Tire Technology Expo 2015 in Cologne, Germany • Autopromotec 2015 in Bologna, Italy• Automechanika Dubai 2015• Alihankinta 2015 in Tampere, Finland • RAIL 2015 in the West Midlands, UK• ACS Rubber Expo 2015 in Cleveland, USA• AAPEX 2015, Las Vegas, USA

PROJECT 2: IDENTIFICATION AND DEVELOPMENT OF NEW MARKETS FOR MALAYSIAN RUBBERPRODUCTS

New business was achieved for Malaysian manufacturers with an estimated value of RM40 million in 2015.

PROJECT3: LIBRARY, INFORMATION, PRINTING AND DESIGN SERVICES

TESTING SERVICES

TARRC’s Materials Characterisation Unit provides an analytical testing service to support internal research projects andconsultancy work. TARRC’s Product Evaluation and Testing Unit also supports internal and consultancy activities.

PROJECT 1: INSTRUMENT MAINTENANCE AND ADMINISTRATION

PROJECT 2: PROACTIVE ANALYTICAL METHOD RESEARCH AND DEVELOPMENT

PROJECT 3: REPRESENTATION ON BRITISH/EUROPEAN STANDARDS COMMITTEES

PROJECT 4: PHYSICAL TESTING METHOD RESEARCH AND DEVELOPMENT

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Above: TARRC exhibited for the second timeat Autopromotec 2015 in Bologna from 20th- 24th May. The 26th International BiennialExhibition of Automotive Equipment andAftermarket Products in Italy.

Below: TARRC was pleased to exhibit for thefirst time at Automechanika Dubai 2015, theMiddle East's leading international automotivetrade fair from 2nd - 4th June 2015.

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TARRC has represented MRB and the Malaysian RubberIndustry and promoted the services of Rubber Consultantsat many exhibitions during 2015, taking almost 400enquiries on the stands. Pictured here top left clockwise:Alihankinta 2015, Tampere, Finland in September. TARRC’sRobert Picken and Kristina Lawson at Rail 2015 in the WestMidlands, UK in September. TARRC’s David Cawthra at thebooth at AAPEX 2015, Las Vegas and Dr Alessandra Di Colaspeaking to Patrick J. DiMauro, Technical Editor of RubberWorld Magazine, at the International Elastomer Conferenceand Rubber Expo 2015 in Cleveland, Ohio in October.

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ANNUAL FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2014

We have audited the financial statements of Tun Abdul Razak Research Centre Limited by Guarantee for the yearended 31st December 2015 which comprise the Income Statement, Other Comprehensive Income, Statement ofFinancial Position, Statement of Changes in Equity, the Statement of Cash Flows and the related notes. The financialreporting framework that has been applied in their preparation is applicable law and Financial Reporting Standard 102(The Financial Reporting Standard applicable in the UK and Republic of Ireland).

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of theCompanies Act 2006. Our audit work has been undertaken so that we might state to the company's members thosematters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extentpermitted by law, we do not accept or assume responsibility to anyone other than the company and the company'smembers as a body, for our audit work, for this report, or for the opinions we have formed.

Respective responsibilities of directors and auditors As explained more fully in the Statement of Directors' Responsibilities set out on page four, the directors areresponsible for the preparation of the financial statements and for being satisfied that they give a true and fair view.Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law andInternational Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing PracticesBoard's (APB's) Ethical Standards for Auditors.

Scope of the audit of the financial statements A description of the scope of an audit of financial statements is provided on the FRC's website atwww.frc.org.uk/apb/scope/private.cfm.

Opinion on financial statementsIn our opinion the financial statements:

- give a true and fair view of the state of the company's affairs as at 31st December 2015 and of its surplus for theyear then ended;

- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and - have been prepared in accordance with the requirements of the Companies Act 2006.

Opinion on other matter prescribed by the Companies Act 2006 In our opinion the information given in the Strategic Report and the Report of the Directors for the financial year forwhich the financial statements are prepared is consistent with the financial statements.

Matters on which we are required to report by exception We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report toyou if, in our opinion:

- adequate accounting records have not been kept, or returns adequate for our audit have not been received frombranches not visited by us; or

- the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.

Nilesh Savjani (Senior Statutory Auditor) for and on behalf of Wags LLP t/a Wagstaffs Chartered Accountants and Statutory AuditorsRichmond HouseWalkern RoadStevenageHertfordshireSG1 3QP

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OFTUN ABDUL RAZAK RESEARCH CENTRE

TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

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The notes form part of these financial statements.

The notes form part of these financial statements

Page 7

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

INCOME STATEMENT FOR THE YEAR ENDED 31ST DECEMBER 2015 2015 2014 Notes £ £ TURNOVER 2 5,534,781 5,441,842 Cost of sales (3,371,138) (3,360,185)

GROSS SURPLUS 2,163,643 2,081,657 Distribution costs (10,110) (12,118) Administrative expenses (1,901,345) (1,712,632)

OPERATING SURPLUS 5 252,188 356,907 Other finance costs 12 (155,000) (153,000)

SURPLUS ON ORDINARY ACTIVITIES BEFORE TAXATION

97,188

203,907

Tax on surplus on ordinary activities 6 (473) (820)

SURPLUS FOR THE FINANCIAL YEAR 96,715 203,087

INCOME STATEMENTFOR THE YEAR ENDED 31ST DECEMBER 2015

TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

The notes form part of these financial statements

Page 8

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 31ST DECEMBER 2015 2015 2014 Notes £ £ SURPLUS FOR THE YEAR 96,715 203,087 OTHER COMPREHENSIVE INCOME Revaluation reserve - 8,817,775 Actuarial loss on pension liability (377,000) (1,886,000) Actual return on assets less interest (472,000) 596,000 Income tax relating to components of - -

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

(849,000)

7,527,775

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(752,285)

7,730,862

OTHER COMPREHENSIVE INCOMEFOR THE YEAR ENDED 31ST DECEMBER 2015

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TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

Dato’ Dr Kamarudin Ab-Malek Dr Stuart CookDirector Director

The financial statements were approved by the Board on 8th September 2016 and signed on its behalf by

Company Registra.on No: 00336256 The notes form part of these financial statements

Page 9

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) STATEMENT OF FINANCIAL POSITION 31ST DECEMBER 2015 2015 2014 Notes £ £ ASSETS FIXED ASSETS Tangible assets 8 10,049,810 9,952,665 CURRENT ASSETS Debtors 9 1,140,118 1,435,314 Cash at bank 728,872 705,989 1,868,990 2,141,303 11,918,800 12,093,968 LIABILITIES RESERVES Revaluation reserve 10 8,817,775 8,817,775 Income and expenditure account 10 (2,218,900) (1,466,615) 6,598,875 7,351,160 CREDITORS 11 349,531 189,414 PENSION LIABILITY 12 4,970,394 4,553,394 11,918,800 12,093,968 The financial statements were approved by the Board of Directors on ............................................. and were signed on its behalf by: ................................................................. Dr S Cook - Director ................................................................. Dr K Ab-Malek - Director

STATEMENT OF FINANCIAL POSITIONFOR THE YEAR ENDED 31ST DECEMBER 2015

The notes form part of these financial statements.

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TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

The notes form part of these financial statements.

STATEMENT OF CHANGES IN EQUITYFOR THE YEAR ENDED 31ST DECEMBER 2015

The notes form part of these financial statements

Page 10

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31ST DECEMBER 2015 Retained Revaluation Total earnings reserve equity £ £ £ Balance at 1st January 2014 (379,702) - (379,702) Changes in equity Total comprehensive income (1,086,913) 8,817,775 7,730,862 Balance at 31st December 2014 (1,466,615) 8,817,775 7,351,160 Changes in equity Total comprehensive income (752,285) - (752,285) Balance at 31st December 2015 (2,218,900) 8,817,775 6,598,875

STATEMENT OF CASH FLOWSFOR THE YEAR ENDED 31ST DECEMBER 2015

The notes form part of these financial statements

Page 11

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31ST DECEMBER 2015 2015 2014 Notes £ £ Cash flows from operating activities Cash generated from operations 1 210,749 29,508 Tax paid (820) (1,063)

Net cash from operating activities 209,929 28,445

Cash flows from investing activities Purchase of tangible fixed assets (192,046) - Sale of tangible fixed assets 5,000 -

Net cash from investing activities (187,046) -

Increase in cash and cash equivalents 22,883 28,445 Cash and cash equivalents at beginning of year

2

705,989

677,544

Cash and cash equivalents at end of year

2

728,872

705,989

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TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

The notes form part of these financial statements.

The notes form part of these financial statements

Page 12

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31ST DECEMBER 2015

1. RECONCILIATION OF SURPLUS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS 2015 2014 £ £ Surplus before taxation 97,188 203,907 Depreciation charges 94,901 77,584 Profit on disposal of fixed assets (5,000) - Amounts owed by connected companies 132,157 (195,098) Adjustment for pension charge (587,000) (577,000) Finance costs 155,000 153,000

(112,754) (337,607) Decrease in trade and other debtors 163,039 337,568 Increase in trade and other creditors 160,464 29,547

Cash generated from operations 210,749 29,508

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31st December 2015 31.12.15 1.1.15 £ £ Cash and cash equivalents 728,872 705,989

Year ended 31st December 2014 31.12.14 1.1.14 £ £ Cash and cash equivalents 705,989 677,544

NOTES TO THE STATEMENTOF CASH FLOWSFOR THE YEAR ENDED 31ST DECEMBER 2015

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TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2015

1. ACCOUNTING POLICIES General information

The company is a private company limited by guarantee and is incorporated and domiciled in England. The address of its registered office is Brickendonbury, Hertford, Hertfordshire, SG13 8NL.

Statement of compliance The individual financial statements of Tun Abdul Razak Research Centre have been prepared in compliance with United Kingdom Accounting Standards, including Financial Reporting Standard 102, "The Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland" ("FRS 102") and the Companies Act 2006.

Basis of preparation These financial statements are prepared on a going concern basis, under the historical cost convention, as modified by the revaluation of land and buildings and certain financial assets and liabilities measured at fair value through statements of comprehensive income.

Turnover

Turnover represents net invoiced sales of goods, excluding value added tax, trade discounts and all other taxes of sales made during the year.

Revenue recognition Revenue is measured at the fair value of the consideration received or receivable and represents the amount receivable for goods supplied or services rendered, net of returns, discounts and rebates allowed by the company and value added taxes. The company recognises revenue when (a) the significant risks and rewards of ownership have been transferred to the buyer; (b) the company retains no continuing involvement or control over the goods; (c) the amount of revenue can be measured reliably; (d) it is probable that future economic benefits will flow to the entity and (e) the costs incurred or to be incurred in respect of the transaction can be measured reliably.

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TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST DECEMBER 2015

1. ACCOUNTING POLICIES - continued Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Plant and machinery - 25% on cost, 20% on cost and 10% on cost

Land and buildings were professionally valued in the year to 31st December 2014 by Derrick Wade Waters, Chartered Surveyors. The company previously adopted a policy of revaluing freehold land and buildings and they were stated at their revalued amount less any subsequent depreciation and accumulated impairment losses. The company has adopted the transition exemption under FRS 102 paragraph 35.10(d) and has elected to use the previous revaluation as deemed cost.

It is the policy of the company not to provide depreciation on the freehold property. The property is maintained to a high standard and the directors consider that the life of the property is so long and that the residual value is so great that depreciation is considered immaterial.

Where any permanent diminution of property value is incurred, a provision is made to the profit and loss account. The directors' estimate of residual value is based on prices prevailing at the time of acquisition or subsequent revaluation.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Research and development

Expenditure on research and development is written off in the year in which it is incurred. Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the statement of financial position date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to surplus or deficit on a straight line basis over the period of the lease.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST DECEMBER 2015

1. ACCOUNTING POLICIES - continued Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Plant and machinery - 25% on cost, 20% on cost and 10% on cost

Land and buildings were professionally valued in the year to 31st December 2014 by Derrick Wade Waters, Chartered Surveyors. The company previously adopted a policy of revaluing freehold land and buildings and they were stated at their revalued amount less any subsequent depreciation and accumulated impairment losses. The company has adopted the transition exemption under FRS 102 paragraph 35.10(d) and has elected to use the previous revaluation as deemed cost.

It is the policy of the company not to provide depreciation on the freehold property. The property is maintained to a high standard and the directors consider that the life of the property is so long and that the residual value is so great that depreciation is considered immaterial.

Where any permanent diminution of property value is incurred, a provision is made to the profit and loss account. The directors' estimate of residual value is based on prices prevailing at the time of acquisition or subsequent revaluation.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Research and development

Expenditure on research and development is written off in the year in which it is incurred. Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the statement of financial position date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to surplus or deficit on a straight line basis over the period of the lease.

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TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST DECEMBER 2015

1. ACCOUNTING POLICIES - continued Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Plant and machinery - 25% on cost, 20% on cost and 10% on cost

Land and buildings were professionally valued in the year to 31st December 2014 by Derrick Wade Waters, Chartered Surveyors. The company previously adopted a policy of revaluing freehold land and buildings and they were stated at their revalued amount less any subsequent depreciation and accumulated impairment losses. The company has adopted the transition exemption under FRS 102 paragraph 35.10(d) and has elected to use the previous revaluation as deemed cost.

It is the policy of the company not to provide depreciation on the freehold property. The property is maintained to a high standard and the directors consider that the life of the property is so long and that the residual value is so great that depreciation is considered immaterial.

Where any permanent diminution of property value is incurred, a provision is made to the profit and loss account. The directors' estimate of residual value is based on prices prevailing at the time of acquisition or subsequent revaluation.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Research and development

Expenditure on research and development is written off in the year in which it is incurred. Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the statement of financial position date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to surplus or deficit on a straight line basis over the period of the lease.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST DECEMBER 2015

1. ACCOUNTING POLICIES - continued Pension costs and other post-retirement benefits

The company operates a defined benefit pension scheme for employees. A defined benefit plan defines the pension benefit that the employee will receive on retirement, usually dependent upon several factors including age, length of service and remuneration.

The liability recognised in the balance sheet in respect of the defined benefit plan is the present value of the defined benefit obligation at the end of the reporting date less the fair value of the plan assets at the reporting date.

The defined benefit obligation is calculated using the projected unit method. Annually the company engages independent actuaries to calculate the obligation. The present value is determined by discounting the estimated future payments using market yields on high quality corporate bonds that are denominated in sterling and that have terms approximating the estimated period of the future payments ('discount rate').

The fair value of plan assets is measured in accordance with the FRS 102 fair value hierarchy and in accordance with the company's policy for similarly held assets. This includes the use of appropriate valuation techniques.

The cost of the defined benefit plan is recognised in the income statement, except where included in the cost of an asset, which comprises of: - the change in the net defined benefit liability arising from employee service rendered during the reporting period in surplus or deficit; and - the cost of plan introductions, benefit changes, curtailments and settlements.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is recognised in the income statement as 'finance expenses'.

The company also operates a defined contribution scheme for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations. The contributions are recognised as an expense when they are due. Amounts not paid are shown in accruals in the balance sheet. The assets of the plan are held separately from the company in independently administered funds.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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2. TURNOVER

The turnover and surplus before taxation are attributable to the one principal activity of the company.

An analysis of turnover by class of business is given below:

2015 2014 £ £ Rubber Consultants 898,951 919,457 Contributions from MRB 4,476,893 4,223,566 Research and other contracts 108,487 194,853 Sundry and other income 50,450 103,966

5,534,781 5,441,842

An analysis of turnover by geographical market is given below: 2015 2014 £ £ UK 636,548 580,134 Europe 331,408 403,742 Rest of the World 4,566,825 4,457,966

5,534,781 5,441,842

3. STAFF COSTS 2015 2014 £ £ Wages and salaries 2,665,732 2,704,609 Social security costs 239,334 246,306 Other pension costs 275,037 276,112

3,180,103 3,227,027

The average monthly number of employees during the year was as follows: 2015 2014 Technical and administration 87 95

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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4. DIRECTORS' EMOLUMENTS 2015 2014 £ £ Directors' remuneration 69,261 63,796 Directors' long term incentive schemes 8,367 7,868

The number of directors to whom retirement benefits were accruing was as follows: Defined benefit schemes 1 1

5. OPERATING SURPLUS The operating surplus is stated after charging/(crediting): 2015 2014 £ £ Hire of plant and machinery 12,575 12,362 Depreciation - owned assets 94,901 77,584 Profit on disposal of fixed assets (5,000) - Auditors' remuneration 10,500 10,500

6. TAXATION Analysis of the tax charge

The tax charge on the surplus on ordinary activities for the year was as follows: 2015 2014 £ £ Current tax: UK corporation tax 473 820

Tax on surplus on ordinary activities 473 820

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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6. TAXATION - continued Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below:

2015 2014 £ £ Surplus on ordinary activities before tax 97,188 203,907

Surplus on ordinary activities multiplied by the standard rate of

corporation tax in the UK of 20% (2014 - 20%)

19,438

40,781 Effects of: Non taxable activities (18,965) (39,961)

Total tax charge 473 820

7. PENSION COSTS

The company operates a defined contribution pension scheme in respect of its employees. The scheme and its assets are held by independent managers. The pension charge represents contributions due from the company and amounted to £214,670 (2014: £223,074).

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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8. TANGIBLE FIXED ASSETS Freehold land and Plant and buildings machinery Totals £ £ £ Cost At 1st January 2015 9,750,000 3,827,532 13,577,532 Additions - 192,046 192,046 At 31st December 2015 9,750,000 4,019,578 13,769,578 Depreciation At 1st January 2015 - 3,624,867 3,624,867 Charge for year - 94,901 94,901 At 31st December 2015 - 3,719,768 3,719,768 Net book value At 31st December 2015 9,750,000 299,810 10,049,810 At 31st December 2014 9,750,000 202,665 9,952,665

The company applied the transitional arrangements of Section 35 of FRS 102 and used previous valuation as deemed cost for freehold properties. Tangible fixed assets included at deemed cost would have been included on a historical cost basis at £2,513,179 (2014: £2,513,179) with total aggregate depreciation £1,679,408 (2014: £1,629,1580) and a net book value of £833,771 (2014: £884,029).

Included within freehold land and buildings is property which has a value of £9,750,000 (2014: £9,750,000). The freehold land and buildings were valued in the year to 31st December 2014 by Derrick Wade Waters, Chartered Surveyors. The valuations are considered to be open market value.

9. DEBTORS 2015 2014 £ £ Amounts falling due within one year: Trade debtors 201,899 160,213 Amounts owed by connected companies 328,693 460,850 Other debtors 22,026 21,161 VAT 45,655 - Prepayments and accrued income 276,189 276,190

874,462 918,414

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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9. DEBTORS - continued 2015 2014 £ £ Amounts falling due after more than one year: Other debtors 2,617 3,348 Prepayments and accrued income 263,039 513,552

265,656 516,900

Aggregate amounts 1,140,118 1,435,314

Included within other debtors are staff loans to the sum of £3,348 (2014: £4,079) representing amounts due from employees in respect of housing loans. The balance at the year end due over 1 year is £2,617 (2014: £3,348).

Also included within prepayments and accrued income is £539,228 (2014: £789,742) representing a contribution from the Malaysian Rubber Board in order to assist with funding the company's defined pension scheme deficit. The contribution is payable over 10 years. Of the total contribution, £263,039 (2014: £513,552) is receivable over a period in excess of one year.

10. RESERVES Income and expenditure Revaluation account reserve Totals £ £ £ At 1st January 2015 (1,466,615) 8,817,775 7,351,160 Surplus for the year 96,715 96,715 Actuarial gain / (loss) (377,000) - (377,000) Revaluation gain (472,000) - (472,000)

At 31st December 2015 (2,218,900) 8,817,775 6,598,875

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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11. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR 2015 2014 £ £ Trade creditors 274,121 104,275 Corporation tax 473 820 Social security and other taxes 62,895 69,379 VAT - 742 Other creditors 1,292 3,448 Accruals and deferred income 10,750 10,750

349,531 189,414

12. EMPLOYEE BENEFIT OBLIGATIONS

For certain employees, the company operates a defined benefit pension scheme with assets held in a separately administered fund. The scheme provides retirement benefits on the basis of members' final salary. The plan is administered by an independent trustee, who is responsible for ensuring that the plan is sufficiently funded to meet current and future obligations. The company has agreed a funding plan whereby ordinary contributions are made into the scheme based on a percentage of active employees' salary. Additional contributions are made to reduce the funding deficit where necessary.

On 30 November 2012, the defined benefit scheme was closed to new entrants. At the same time, the company established a defined contributions scheme to provide benefits to new employees.

The amounts recognised in surplus or deficit are as follows: Defined benefit pension plans 2015 2014 £ £ Current service cost - 52,000 Net interest from net defined benefit

asset/liability

155,000

153,000 Past service cost - -

155,000 205,000

Actual return on plan assets 517,000 1,180,000

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

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TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST DECEMBER 2015

12. EMPLOYEE BENEFIT OBLIGATIONS - continued

Changes in the present value of the defined benefit obligation are as follows: Defined benefit pension plans 2015 2014 £ £ Opening defined benefit obligation 18,417,000 16,256,000 Current service cost - 52,000 Interest cost 672,000 737,000 Actuarial losses/(gains) 377,000 1,886,000 Benefits paid (522,000) (514,000) 18,944,000 18,417,000 Changes in the fair value of scheme assets are as follows: Defined benefit pension plans 2015 2014 £ £ Opening fair value of scheme assets 13,863,606 12,568,606 Contributions by employer 639,000 629,000 Expected return 517,000 702,000 Actuarial gains/(losses) - 478,000 Benefits paid (522,000) (514,000) Current service cost (52,000) - Return on assets excluding interest income (472,000) - 13,973,606 13,863,606

The amounts recognised in other comprehensive income are as follows: Defined benefit pension plans 2015 2014 £ £ Actuarial loss on defined benefit

obligation

(377,000)

(1,886,000) Actual return on assets less interest (472,000) 596,000

(849,000) (1,290,000)

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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59www.tarrc.co.uk

TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

Page 23

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST DECEMBER 2015

12. EMPLOYEE BENEFIT OBLIGATIONS - continued

The major categories of scheme assets as amounts of total scheme assets are as follows: Defined benefit pension plans 2015 2014 £ £ Equities 8,367,000 8,269,000 Bonds 2,270,000 2,291,000 Gilts 3,121,000 3,154,000 Cash 215,606 149,606 13,973,606 13,863,606

The company operates a pension scheme providing benefits based on final pensionable pay. The assets of the scheme are held separately from those of the company, being invested with insurance companies.

Principal actuarial assumptions at the balance sheet date (expressed as weighted averages):

2015 2014 Discount rate 3.75% 3.70% Future salary increases 2.80% 2.90% Future pension increases 3.40% 3.40%

Page 24

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST DECEMBER 2015 13. RELATED PARTY DISCLOSURES

During the year the company charged the Office of London Representative of the Malaysian Rubber Board a sum of £32,147 (2014: £39,433) in respect of administration services, use of office and services supplied.

At the balance sheet date a net amount of £115,247 (2014: £353,501) was owed from the Office of London Representative of the Malaysian Rubber Board. This amount is shown within debtors falling due within one year.

During the year the company charged a sum of £107,779 (2014: £171,522) to Elgem Technology for scientific and research consultancy, and the provision of services.

At the balance sheet date Elgem Technology owed the company a sum of £113,180 (2014: £94,349). This amount is shown within debtors falling due within one year.

At the balance sheet date Malaysian Rubber Board owed the company a sum of £100,266 (2014: £13,000). This amount is shown within debtors falling due within one year. Also included within prepayments and accrued income is £539,228 (2014: £789,742) representing a contribution from the Malaysian Rubber Board in order to assist with funding the company's defined pension scheme deficit. The contribution is payable over 10 years. Of the total contribution, £263,039 (2014: £513,552) is receivable over a period in excess of one year.

Tun Abdul Razak Research Centre, Elgem Technology,Malaysian Rubber Board and the Malaysian Rubber Board Office of London Representative are all controlled by the Ministry of Plantation Industries and Commodities.

14. ULTIMATE CONTROLLING PARTY

The company is controlled by the Malaysian Rubber Board, which is a statutory authority of the government of Malaysia.

15. COMPANY LIMITED BY GUARANTEE

The Tun Abdul Razak Research Centre (TARRC) is an organisation and research centre of the Malaysian Rubber Board, the body corporate established by statute in Malaysia for purposes of overseeing the development of the rubber industry with research and development as the core activity.

Incorporated in England since 1938, TARRC is a Company Limited by Guarantee and not having share capital, the word Limited being omitted by Licence of The Department of Trade and Industry. TARRC by reason of the definition in Section 1 (1) of the Companies Act 1980 and the bringing into force of Part 1 of the Act became a Private Company on 22nd December 1980.

The liability of each member is limited to £1.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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60 www.tarrc.co.uk

TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

Page 25

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST DECEMBER 2015

16. TRANSITION TO FRS 102

Under previous UK GAAP the company had a policy of revaluing land and buildings. On transition to FRS 102 the company has elected to use the previous revaluation of land and buildings in the year ended 31 December 2014 as the deemed cost for those assets. There is no effect on the balance sheet on transition.

Page 24

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST DECEMBER 2015

13. RELATED PARTY DISCLOSURES - continued

During the year the company charged the Office of London Representative of the Malaysian Rubber Board a sum of £32,147 (2014: £39,433) in respect of administration services, use of office and services supplied.

At the balance sheet date a net amount of £115,247 (2014: £353,501) was owed from the Office of London Representative of the Malaysian Rubber Board. This amount is shown within debtors falling due within one year.

During the year the company charged a sum of £107,779 (2014: £171,522) to Elgem Technology for scientific and research consultancy, and the provision of services.

At the balance sheet date Elgem Technology owed the company a sum of £113,180 (2014: £94,349). This amount is shown within debtors falling due within one year.

At the balance sheet date Malaysian Rubber Board owed the company a sum of £100,266 (2014: £13,000). This amount is shown within debtors falling due within one year. Also included within prepayments and accrued income is £539,228 (2014: £789,742) representing a contribution from the Malaysian Rubber Board in order to assist with funding the company's defined pension scheme deficit. The contribution is payable over 10 years. Of the total contribution, £263,039 (2014: £513,552) is receivable over a period in excess of one year.

Tun Abdul Razak Research Centre, Elgem Technology,Malaysian Rubber Board and the Malaysian Rubber Board Office of London Representative are all controlled by the Ministry of Plantation Industries and Commodities.

14. ULTIMATE CONTROLLING PARTY

The company is controlled by the Malaysian Rubber Board, which is a statutory authority of the government of Malaysia.

15. COMPANY LIMITED BY GUARANTEE

The Tun Abdul Razak Research Centre (TARRC) is an organisation and research centre of the Malaysian Rubber Board, the body corporate established by statute in Malaysia for purposes of overseeing the development of the rubber industry with research and development as the core activity.

Incorporated in England since 1938, TARRC is a Company Limited by Guarantee and not having share capital, the word Limited being omitted by Licence of The Department of Trade and Industry. TARRC by reason of the definition in Section 1 (1) of the Companies Act 1980 and the bringing into force of Part 1 of the Act became a Private Company on 22nd December 1980.

The liability of each member is limited to £1.

Page 24

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) NOTES TO THE FINANCIAL STATEMENTS - continued FOR THE YEAR ENDED 31ST DECEMBER 2015

13. RELATED PARTY DISCLOSURES - continued

During the year the company charged the Office of London Representative of the Malaysian Rubber Board a sum of £32,147 (2014: £39,433) in respect of administration services, use of office and services supplied.

At the balance sheet date a net amount of £115,247 (2014: £353,501) was owed from the Office of London Representative of the Malaysian Rubber Board. This amount is shown within debtors falling due within one year.

During the year the company charged a sum of £107,779 (2014: £171,522) to Elgem Technology for scientific and research consultancy, and the provision of services.

At the balance sheet date Elgem Technology owed the company a sum of £113,180 (2014: £94,349). This amount is shown within debtors falling due within one year.

At the balance sheet date Malaysian Rubber Board owed the company a sum of £100,266 (2014: £13,000). This amount is shown within debtors falling due within one year. Also included within prepayments and accrued income is £539,228 (2014: £789,742) representing a contribution from the Malaysian Rubber Board in order to assist with funding the company's defined pension scheme deficit. The contribution is payable over 10 years. Of the total contribution, £263,039 (2014: £513,552) is receivable over a period in excess of one year.

Tun Abdul Razak Research Centre, Elgem Technology,Malaysian Rubber Board and the Malaysian Rubber Board Office of London Representative are all controlled by the Ministry of Plantation Industries and Commodities.

14. ULTIMATE CONTROLLING PARTY

The company is controlled by the Malaysian Rubber Board, which is a statutory authority of the government of Malaysia.

15. COMPANY LIMITED BY GUARANTEE

The Tun Abdul Razak Research Centre (TARRC) is an organisation and research centre of the Malaysian Rubber Board, the body corporate established by statute in Malaysia for purposes of overseeing the development of the rubber industry with research and development as the core activity.

Incorporated in England since 1938, TARRC is a Company Limited by Guarantee and not having share capital, the word Limited being omitted by Licence of The Department of Trade and Industry. TARRC by reason of the definition in Section 1 (1) of the Companies Act 1980 and the bringing into force of Part 1 of the Act became a Private Company on 22nd December 1980.

The liability of each member is limited to £1.

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31ST DECEMBER 2015

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61www.tarrc.co.uk

TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

The notes form part of these financial statements.

The notes form part of these financial statements

Page 26

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) RECONCILIATION OF EQUITY 1ST JANUARY 2014 (DATE OF TRANSITION TO FRS 102) Effect of UK transition GAAP to FRS 102 FRS 102 Notes £ £ £ ASSETS FIXED ASSETS Tangible assets 1,212,474 - 1,212,474 CURRENT ASSETS Debtors 1,577,784 - 1,577,784 Cash at bank 677,544 - 677,544 2,255,328 - 2,255,328 3,467,802 - 3,467,802 LIABILITIES RESERVES Income and expenditure account (379,702) - (379,702) (379,702) - (379,702) CREDITORS 160,110 - 160,110 PENSION LIABILITY 3,687,394 - 3,687,394 3,467,802 - 3,467,802

RECONCILIATION OF EQUITY1ST JANUARY 2014

(DATE OF TRANSITION TO FRS 102)

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62 www.tarrc.co.uk

TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

The notes form part of these financial statements.

The notes form part of these financial statements

Page 27

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) RECONCILIATION OF EQUITY - continued 31ST DECEMBER 2014

Effect of UK transition GAAP to FRS 102 FRS 102 Notes £ £ £ ASSETS FIXED ASSETS Tangible assets 9,952,665 - 9,952,665 CURRENT ASSETS Debtors 1,435,314 - 1,435,314 Cash at bank 705,989 - 705,989 2,141,303 - 2,141,303 12,093,968 - 12,093,968 LIABILITIES RESERVES Revaluation reserve 8,817,775 - 8,817,775 Income and expenditure account (1,466,615) - (1,466,615) 7,351,160 - 7,351,160 CREDITORS 189,414 - 189,414 PENSION LIABILITY 4,553,394 - 4,553,394 12,093,968 - 12,093,968

RECONCILIATION OF EQUITY - continued1ST JANUARY 2014

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63www.tarrc.co.uk

TUN ABDUL RAZAK RESEARCH CENTRELIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256)

The notes form part of these financial statements.

The notes form part of these financial statements

Page 28

TUN ABDUL RAZAK RESEARCH CENTRE LIMITED BY GUARANTEE (REGISTERED NUMBER: 00336256) RECONCILIATION OF SURPLUS FOR THE YEAR ENDED 31ST DECEMBER 2014

Effect of UK transition GAAP to FRS 102 FRS 102 £ £ £ TURNOVER 5,441,842 - 5,441,842 Cost of sales (3,360,185) - (3,360,185)

GROSS SURPLUS 2,081,657 - 2,081,657 Distribution costs (12,118) - (12,118) Administrative expenses (1,712,632) - (1,712,632)

OPERATING SURPLUS 356,907 - 356,907 Other finance costs (35,000) (118,000) (153,000)

SURPLUS ON ORDINARY ACTIVITIES BEFORE TAXATION

321,907

(118,000)

203,907

Tax on surplus on ordinary activities (820) - (820)

SURPLUS FOR THE FINANCIAL YEAR 321,087 (118,000) 203,087

RECONCILIATION OF SURPLUSFOR THE YEAR ENDED 31ST DECEMBER 2014

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64 www.tarrc.co.uk

Hamid Ahmadi*, Julia Gough, and Alan MuhrAssessing quality of manufacture of rubber-steel laminated seismic isolators14th World Conference on Seismic Isolation, Energy Dissipation and Active Vibration Control of StructuresSan Diego, California, USA9-11 September 2015Publication 1938

T Dalrymple*, J A Hurtado, I Lapczyk (DS SIMULIA Corp. USA) and Hamid AhmadiParallel rheological framework to model the amplitude dependence of the dynamic stiffness in carbon-black filled rubberConstitutive Models for Rubber IX, ed. Marvalova & Petrikova, 189-195Publication 1939

Enrico Tubaldi*, Hamid Ahmadi, Alan Muhr and John KingstonModels for filled rubber in simple shearConstitutive Models for Rubber IX, ed. Marvalova & Petrikova, 487-493Publication 1940

Stuart CookNatural rubber – a material for the future India Rubber Meet, Kochi, India5 March 2015Publication 1941

Alessandra Di ColaLateral Flow Diagnostic kit for latex allergensAdvanced Materials in Healthcare Conference 2015Cleveland, Ohio, USA12 October 2015Publication 1942

Marina FernandoNatural-FR for transport applications: a sustainable solution to meeting material flammability requirements in rubber productsMRB Rubber Technology Developments, Vol 14(2) 2014, 59-64Publication 1943

Marina FernandoA flame retardant natural rubber to meet material flammability and sustainability requirements in rubber productsStretch, 2nd Qtr 2015, Vol 9, 6-9Publication 1944

Julia Gough*, Hamid Ahmadi, Alan Harris, John Kingston, R. Whear & A Kilgour (Jaguar Land Rover) T. C. Seng (MRB)Modelling the dynamic behaviour of an automotive bush with a visco-hyperelastic-elastoplastic modelConstitutive Models for Rubber IX, ed. Marvalova & Petrikova, 479-485Publication 1945

Kamarudin Ab-MalekChallenges in the applications of seismic rubber bearings for earthquake protection of buildings and bridgesMREPC Engineered Rubber Products SeminarDubai, UAE20 January 2015Publication 1946

Speakers are indicated by an asterisk (*). All lectures listed with a number have been published.

STAFF LECTURES, POSTERS, WEBINARS& PUBLICATIONS 2015

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65www.tarrc.co.uk

Kamarudin Ab-MalekOn the challenges of the applications of seismic rubber bearingsMRB Seismic Rubber Bearing SeminarKota Kinabalu, Malaysia12 November 2015Publication 1947

Kamarudin Ab-MalekRecent advances in the use of natural rubber in engineeringInternational Conference on the Science and Engineering of Materials Kuala Lumpur, Malaysia16 November 2015Publication 1948

Anna Kepas-SuwaraLoss tangent and stiffness mapping of NR/BR blends using AFMTire Technology Expo, Cologne, Germany10-12 February 2015Publication 1949

Pamela Martin*, Paul Brown and Stuart CookVisualisation of tread wearTire Technology ExpoCologne, Germany10-12, February 2015Publication 1950

Pamela Martin*, Paul Brown and Stuart CookVisualizing tire wear187th Technical Meeting of the Rubber Division of the American Chemical SocietyGreenville, South Carolina, USA27-30 April 2015Publication 1951

Pamela Martin*, Paul Brown and Stuart CookVisualising tread wearTyre 2015, 4th International Tyre Colloquium (sponsored by Jaguar Land Rover)Dept of Mechanical Engineering Sciences, University of Surrey, Guildford20-21 April 2015Publication 1952

Pamela Martin*, Paul Brown and Stuart CookSilica filled natural rubber188th Technical Meeting of the Rubber Division of the American Chemical SocietyCleveland, Ohio, USA13 – 15 October 2015Publication 1953

Pamela Martin*, Paul Brown and Stuart CookSilica-reinforced natural rubber188th Technical Meeting of the Rubber Division of the American Chemical SocietyCleveland, Ohio, USA13 – 15 October 2015Publication 1954

STAFF LECTURES, POSTERS, WEBINARS & PUBLICATIONScontinued

Dr Anna Kepas-Suwara

Dr Pamela Martin

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Christopher Middleton*, Nurul Siddiqui, Shabhonam Caim (The Genome Analysis Centre, UK) and Keng-See Chow& Safiah Atan (RRIM Malaysia), Maria Kolesnikova-Allen and Alessandra Di ColaExpression changes in Hevea brasiliensis roots in response to Rigidoporus microporus infectionXVIII International Plant Protection Congress (IPPC), Berlin24-27 August 2015Publication 1955

Alan Muhr*, Hamid Ahmadi and Enrico TubaldiBiaxial simple shear of rubber188th Technical Meeting of the Rubber Division of the American Chemical SocietyCleveland, Ohio, USA13 – 15 October 2015Publication 1956

Marco Donà (Department ICEA, University of Padova, Italy, Giovanni Tecchio and Claudio Modena* (Departmentof Civil Architectural and Environmental Engineering - University of Padova, Italy), and Alan MuhrRolling-ball rubber-layer isolation system: state of the art, performance and design procedureCOMPDYN 2015. 5th ECCOMAS Thematic Conference on Computational Methods in Structural Dynamicsand Earthquake EngineeringCrete, Greece25–27 May 2015Publication 1957

Marco Donà (Department ICEA, University of Padova, Italy) and Alan MuhrBiaxial model for the rolling-ball rubber-layer isolation systemConstitutive Models for Rubber IX, ed. Marvalova & Petrikova, 585-590Publication 1958

Marco Donà, Alan Muhr*, Giovanni Tecchio & Gabriele Granello (University of Padova, Italy)Rolling-ball rubber-layer isolation system – small deflection and vibrational behaviourSECED 2015 Conference: Earthquake Risk and Engineering towards a Resilient WorldHomerton College, Cambridge, UK9-10 July 2015Publication 1959

Marco Donà (Department ICEA, University of Padova, Italy) and Alan Muhr*Rolling friction of a sphere on rubber188th Technical Meeting of the Rubber Division of the American Chemical SocietyCleveland, Ohio, USA13 – 15 October 2015Publication 1960

Marco Donà, G Tecchio, M Parolin & C Modena (Department of Civil Architectural and Environmental Engineering- University of Padova, Italy) and Alan MuhrModelling of the rubber relaxation effects on the small-deflections behaviour of the seismic isolation system RBRLConstitutive Models for Rubber IX, ed. Marvalova & Petrikova, 577-583Publication 1961

P-Y Le Gac, M Arhant, P Davies and Alan MuhrFatigue behaviour of natural rubber in marine environment: comparison between air and seawaterMaterials & Design, 65, 462-467Publication 1962

Laura RAGNI, Dept of Civil Engineering, Construction and Architecture, Polytechnic University of Marche, Ancona,Alan Muhr, Enrico Tubaldi* and Andrea Dall'Asta (School of Architecture and Design, University of Camerino)Influence of high damping natural rubber bearing model on the seismic response evaluation of isolated bridgesSECED 2015 Conference: Earthquake Risk and Engineering towards a Resilient WorldHomerton College, Cambridge UK9-10 July 2015Publication 1963

www.tarrc.co.uk66

STAFF LECTURES, POSTERS, WEBINARS & PUBLICATIONScontinued

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67www.tarrc.co.uk

STAFF LECTURES, POSTERS & WEBINARS(no publication available)

T Dalrymple*, J A Hurtado & I Lapczyk (DS SIMULIA Corp. USA), and Hamid AhmadiParallel rheological framework to model the amplitude dependence of the dynamic stiffness in carbon-black filled rubber9th European Conference on Constitutive Models for Rubbers (ECCMR)Prague, Czech Republic1-4 September 2015

Enrico Tubaldi*, Hamid Ahmadi, Alan Muhr and John KingstonModels for filled rubber in simple shear9th European Conference on Constitutive Models for Rubbers (ECCMR)Prague, Czech Republic1-4 September 2015

Alessandra Di Cola, Nurul Siddiqui* and Cristina RibeiroDifferential expression of Hevea Brasiliensis root proteins in response to infection by soil fungus rigidoporus microporusEast Midlands Proteomics Workshop 2015, Warwick University18 November 2015Poster

Stuart CookSMR processingRubber Traders Association of Europe (RTAE) Training SeminarMalaysia23 April 2015

Julia Gough*, Hamid Ahmadi, Alan Harris, John Kingston, R Whear & A Kilgour (Jaguar Land Rover) and T. C. Seng (MRB)Modelling the dynamic behaviour of an automotive bush with a visco-hyperelastic-elastoplastic model9th European Conference on Constitutive Models for Rubbers (ECCMR)Prague, Czech Republic1-4 September 2015

Kamarudin Ab-MalekSeismic protection of bridges using high damping rubber bearingsHyundai Engineering and ConstructionSeoul, South Korea27 February 2015

Kamarudin Ab-MalekHigh damping rubber bearings for bridgesDaelim Industrial Co Ltd, Brunei22 November 2015

Anna Kepas-Suwara and Dr Donna Hurley (Lark Scientific)Beyond topography: new advances in AFM characterization of polymersMaterials World magazine28 May 2015Webinar

Alan Muhr and James Busfield (Queen Mary, University of London)Foundations of rubber behaviour for modelling tires and other applications 2015Short Course (15 lectures)Tire Technology Expo, Cologne, Germany9-12 February 2015

Alan MuhrBehavior of rubber: applications of stress-strain models187th Technical Meeting of the Rubber Division of the American Chemical SocietyCleveland, Ohio, USA27-30 April 2015

Dr Alan Muhr

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68 www.tarrc.co.uk

© Tun Abdul Razak Research Centre 2016

Alan MuhrRubber for seismic engineering applications: behaviour and applications of stress-strain modelsDept of Civil, Architectural and Environmental EngineeringUniversity of Padova, Italy9 June 2015

Alan MuhrRubber for engineering applications: Efficient characterisation of stress-strain modelsChemnitz University of Technology, Germany31 July 2015

Alan MuhrApplications of stress-strain models to friction of indentors on rubber9th European Conference on Constitutive Models for Rubbers (ECCMR)Prague, Czech Republic1-4 September 2015

Marco Donà, G Tecchio, M Parolin & C Modena* (Dept of Civil Architectural and Environmental Engineering, Universityof Padova, Italy) and Alan MuhrModelling of the rubber relaxation effects on the small-deflections behaviour of the seismic isolation system RBRL9th European Conference on Constitutive Models for Rubbers (ECCMR)Prague, Czech Republic1-4 September 2015

Marco Donà (Dept ICEA, University of Padova, Italy) and Alan Muhr*Biaxial model for the rolling-ball rubber-layer isolation system9th European Conference on Constitutive Models for Rubbers (ECCMR)Prague, Czech Republic 1-4 September 2015Poster

David Smith, Alan Muhr* and Mark McBrideEffect of moored vessels on the design of maritime structures for seismic and tsunami loadingSECED 2015 Conference: Earthquake Risk and Engineering towards a Resilient WorldHomerton College, Cambridge, UK9-10 July 2015Poster

STAFF LECTURES, POSTERS & WEBINARScontinued

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