TIDMIKK
RNS Number : 4568R
Inch Kenneth Kajang Rubber
30 April 2009
INCH KENNETH KAJANG RUBBER PLC
GROUP ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2008
CONTENTS
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| | | Corporate Information | 1 |
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| | | Board of Directors' Profile | 3 |
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| | | Chairman's Statement | 6 |
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| | | Corporate Governance | 8 |
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| | | Corporate Social Responsibilities | 17 |
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| | | Audit Committee Report | 18 |
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| | | Statement on Internal Control | 20 |
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| | | Five Year Group Financial Highlights | 22 |
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| | | Directors' Report | 24 |
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| | | Statement of Responsibilities of those | 30 |
| | | Charged with Governance | |
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| | | Statutory Declaration | 31 |
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| | | Independent Auditors' Report | 32 |
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| | | Group and Company Income Statement | 34 |
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| | | Group and Company Balance Sheets | 35 |
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| | | Group Statement of Changes in Equity | 36 |
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| | | Company Statement of Changes in Equity | 37 |
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| | | Group and Company Cash Flow Statements | 38 |
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| | | Notes to the Financial Statements | 39 |
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| | | List of Properties Held | 67 |
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Corporate Information
+-------------------------------+----+--------------------------------------+
| BOARD OF DIRECTORS | | |
+-------------------------------+----+--------------------------------------+
| Dato' Adnan bin Maaruf | | Non-Independent Director/Executive |
| | | Chairman |
+-------------------------------+----+--------------------------------------+
| Ahmad Zakie bin Haji Ahmad | | Independent Non-Executive Director |
| Shariff | | |
+-------------------------------+----+--------------------------------------+
| Dato' Haji Muda bin Mohamed | | Independent Non-Executive Director |
+-------------------------------+----+--------------------------------------+
| Abdul Khudus bin Mohd. Naaim | | Non-Independent Non-Executive |
| | | Director |
+-------------------------------+----+--------------------------------------+
| Dr. Radzuan bin A. Rahman | | Independent Non-Executive Director |
+-------------------------------+----+--------------------------------------+
| Tengku Mohamed Fauzi bin | | Independent Non-Executive Director |
| Tengku | | |
| Abdul Hamid | | |
+-------------------------------+----+--------------------------------------+
| Alan Maitland Dewar McWilliam | | Alternate Director to Tengku Mohamed |
| | | Fauzi bin Tengku Abdul Hamid |
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| AUDIT COMMITTEE | | |
+-------------------------------+----+--------------------------------------+
| Ahmad Zakie bin Haji Ahmad | | Chairman |
| Shariff | | |
+-------------------------------+----+--------------------------------------+
| Dato' Haji Muda bin Mohamed | | Member |
+-------------------------------+----+--------------------------------------+
| Abdul Khudus bin Mohd. Naaim | | Member |
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| UK COMPANY NUMBER | | SC007574 |
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| MALAYSIA COMPANY NUMBER | | 990261-M |
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| COMPANY SECRETARY | | Lee Thai Thye (LS 0000737) |
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| REGISTERED OFFICE IN UK | | No. 2 Lochrin Square, 96 |
| | | Fountainbridge |
+-------------------------------+----+--------------------------------------+
| | | Edinburgh EH 3QA, Midlothian, United |
| | | Kingdom |
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| | | Tel: 44 0131 226 5541 Fax: 44 0131 |
| | | 226 2278 |
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| PRINCIPAL OFFICE IN MALAYSIA | | 22nd Floor Menara Promet, Jalan |
| | | Sultan Ismail, |
| | | 50250 Kuala Lumpur, Malaysia |
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| | | Tel: 603-2144 4446 Fax: 603-2141 |
| | | 8463 |
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| PRINCIPAL REGISTRAR IN UK | | Computershare Investor Services PLC |
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| | | P.O. Box 82, The Pavillions, |
| | | Bridgwater Road, |
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| | | Bristol BS99 7NH, United Kingdom |
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| | | Tel: 44 0870 702 0003 Fax: 44 0870 |
| | | 703 6101 |
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| REGISTRAR IN MALAYSIA | | Mestika Projek (M) Sdn Bhd |
| | | (225545-V) |
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| | | 22nd Floor Menara Promet, Jalan |
| | | Sultan Ismail, |
+-------------------------------+----+--------------------------------------+
| | | 50250 Kuala Lumpur, Malaysia |
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| | | Tel: 603-2144 4446 Fax: 603-2141 |
| | | 8463 |
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| AUDITORS | | UHY Hacker Young LLP |
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| | | Quadrant House, 17 Thomas More |
| | | Street, |
| | | Thomas More Square, |
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| | | London E1W 1YW, United Kingdom |
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| MANAGING AGENTS | | Sime Darby Seeds and Agricultural |
| | | Services Sdn Bhd |
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| | | 14th Floor Wisma Consplant 1 |
| | | No. 2 Jalan SS 16/4, 47400 Subang |
| | | Jaya, |
| | | Selangor, Malaysia |
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| | | |
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| PRINCIPAL BANKERS | | Kuwait Finance House (Malaysia) |
| | | Berhad, Malaysia |
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| | | Bank Kerjasama Rakyat |
| | | Malaysia Berhad, Malaysia |
| | | OCBC Bank (Malaysia) Berhad, |
| | | Malaysia |
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| | | RHB Bank Berhad, Malaysia |
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| | | CIMB Bank Berhad, Malaysia |
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| STOCK EXCHANGE LISTINGS | | Bursa Malaysia Securities Berhad |
+-------------------------------+----+--------------------------------------+
| | | London Stock Exchange plc |
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| | | Singapore Exchange Securities |
| | | Trading Limited |
| | | |
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Board of Directors' Profiles
DATO' ADNAN BIN MAARUF
Non-Independent Director
Executive Chairman
Malaysian, aged 66
Dato' Adnan bin Maaruf was appointed to the Board on 22 April 2000.
He graduated from University of Malaya with a Bachelor of Arts (Honours) degree
and a Masters in Management from AIM Philippines. He started his career in the
Government sector and after 18 years, became the Deputy Secretary General in the
Ministry of National and Rural Development. He then became the Managing Director
of Mara Holdings Sdn Bhd for 5 years. Subsequently, he became the Chairman of
Malaysia Cooperative Insurance Society (MCIS) for 10 years.
He does not have any family relationship with any Director and/or major
shareholder of the Company and there is no business arrangement with the
Company in which he has a personal interest. He attended all the Board Meetings
held in the financial year ended 31 December 2008.
He has had no convictions for any offences within the past 10 years.
AHMAD ZAKIE BIN HAJI AHMAD SHARIFF
Independent Non-Executive Director
Chairman of the Audit Committee
Malaysian, aged 52
Encik Ahmad Zakie bin Haji Ahmad Shariff was appointed to the Board on 25
September 2006. He is the Chairman of the Audit Committee.
He graduated with a Bachelor in Economics from Universiti Kebangsaan Malaysia
and Master in Accounting Science from University of Illinois. He started his
career in Bapema Corporation Sdn Bhd in 1980. He then became a lecturer in
Universiti Kebangsaan Malaysia for 9 years. Then he became a research analyst
with a few reputable stockbroking companies for 5 years. Subsequently, he joined
the corporate sector as Assistant General Manager in Shapadu Corporation Sdn
Bhd. Later, he headed two asset management companies and a stockbroking firm for
10 years. He is now the General Manager, Group Business Development in UEM Group
Berhad. He does not hold a Director's position in any other listed company.
He does not have any family relationship with any Director and/or major
shareholder of the Company and there is no business arrangement with the
Company in which he has a personal interest. He attended all the Board Meetings
held in the financial year ended 31 December 2008.
He has had no convictions for any offences within the past 10 years.
DATO' HAJI MUDA BIN MOHAMED
Independent Non-Executive Director
Member of the Audit Committee
Malaysian, aged 65
Dato' Haji Muda bin Mohamed was appointed to the Board on 15 February 2000. He
is also a member of the Audit Committee.
He graduated with a Diploma in Civil Engineering and subsequently a Bachelor of
Science (Honours) degree. A Fellow in the Institution of Engineers Malaysia,
he started his career as an engineer in two government agencies and an
international oil company. After 13 years, he joined Sime UEP Properties Bhd and
left 10 years later after becoming its Operation Director. He then went on to
TTDI Development Sdn Bhd, and after 7 years, left after serving as its Group
Chief Executive Officer. He is now an Executive Chairmanof a company dealing in
civil engineering contracting jobs.He does not sit on a board of any other
listed company.
He does not have any family relationship with any Director and/or major
shareholder of the Company and there is no business arrangement with the Company
in which he has a personal interest. He attended all the Board Meetings held in
the financial year ended 31 December 2008.
He has had no convictions for any offences within the past 10 years.
ABDUL KHUDUS BIN MOHD. NAAIM
Non-Independent Non-Executive Director
Member of the Audit Committee
Malaysian, aged 55
Encik Abdul Khudus bin Mohd. Naaim was appointed to the Board on 1 October 2001.
He is also a member of the Audit Committee.
His career started as an Audit Junior at Arthur Young & Co, Public Accountants,
Kuala Lumpur from January 1976 to December 1976 and later served as Audit Senior
at Ramoss Jassen & Partners, Chartered Accountants, London from July 1980 to
December 1984. He was appointed as Accountant at Islamic Finance House PLC,
London from January to December 1985. He joined Syarikat Takaful Malaysia Berhad
in January 1986 until August 1993 with the last position as Senior Finance
Manager. From September 1993 to December 1996, he was Director of Corporate
Affairs at Emile Woolf Group of Colleges, Kuala Lumpur. He later joined SKMN
Associates, Chartered Accountants, Malaysia from January 1997 until September
1999 as a Partner. He has been a partner at KS & Associates, Chartered
Accountants, Malaysia since October 1999, which has since merged with AKN Arif,
Chartered Accountants in August 2008.His directorships as Member of Board of
Directors and Audit Committee in other public companies are Concrete Engineering
Products Berhad and Ingress Corporation Berhad. He is also a director of a
number of private limited companies.
He does not have any family relationship with any Director and/or major
shareholder of the Company and there is no business arrangement with the
Company in which he has a personal interest. He attended all the Board Meetings
held in the financial year ended 31 December 2008.
He has had no convictions for any offences within the past 10 years.
DR. RADZUAN BIN A. RAHMAN
Independent Non-Executive Director
Malaysian, aged 66
Dr. Radzuan bin A. Rahman was appointed to the Board on 24 March 2005.
He graduated with a Bachelor in Agricultural Science from University Malaya, and
later pursued his Masters in Science and Doctorate in Resource Economics
at Cornell University. He was a lecturer and Dean at the faculty of Resource
Economics and Agribusiness, Universiti Pertanian Malaysia (now known
as Universiti Putra Malaysia) until March 1980. He then went to Sime Darby
Plantations Berhad and in 1984, joined Golden Hope Plantations Berhad as a
Director of Corporate Planning and worked his way up to be Group Director of the
plantation division. He was later appointed as the Managing Director of Island
& Peninsular Berhad and Austral Enterprises Berhad and retired in 2004. He was a
Director of Fraser & Neave Holdings Berhad. He also sits on the boards of
Idaman Unggul Berhad, Kuwait Finance House (Malaysia) Berhad and several private
companies.
He does not have any family relationship with any Director and/or major
shareholder of the Company and there is no business arrangement with the
Company in which he has a personal interest. He attended all the Board Meetings
held in the financial year ended 31 December 2008.
He has had no convictions for any offences within the past 10 years.
TENGKU MOHAMED FAUZI BIN TENGKU ABDUL HAMID
Independent Non-Executive Director
Malaysian, aged 57
YM Tengku Mohamed Fauzi bin Tengku Abdul Hamid was appointed to the Board on
23 January 2009.
He is the founding partner of the law firm Messrs Tengku Mohamed & Alan Lim,
Kuala Lumpur, and has been practising Corporate and Commercial Lawyer since
1985. He is currently an Independent Non-Executive Director in Axis Corporation
Berhad and a Non-Independent Non-Executive Director in Formosa Prosonic
Industries Berhad. He is a member of the Disciplinary Committee of the Bar
Council. Outside the legal and corporate world, since 1995, he has been the Vice
President of the Malaysian Branch of the Royal Asiatic Society (MBRAS),
a historical research organisation established in 1877. He also serves as
Executive Committee Member of the Malaysian Intellectual Property Association
(MIPA).
He does not have any family relationship with any Director and/or major
shareholder of the Company and there is no business arrangement with the
Company in which he has a personal interest. He attended three (3) of the Board
Meetings held in the financial year ended 31 December 2008.
He has had no convictions for any offences within the past 10 years.
ALAN MAITLAND DEWAR MCWILLIAM
Alternate Director to Tengku Mohamed Fauzi bin Tengku Abdul Hamid
Scottish, aged 56
Mr. Alan Maitland Dewar McWilliam was appointed to the Board on 16 February
2009.
He graduated from Oxford University with a Bachelor of Arts degree and
subsequently a Masters of Arts degree from the same university. He also has a
LLB from Edinburgh and was admitted as a Solicitor in Scotland in 1980 and later
Writer to the Signet in 1982. He was a partner in a firm in Scotland for 14
years before starting his own sole principal practice for the past 10 years. He
does not hold a Director's position in any other listed entity.
He does not have any family relationship with any Director and/or major
shareholder of the Company and there is no business arrangement with the Company
in which he has a personal interest. He attend one (1) of the Board Meetings
held in the financial year ended 31 December 2008.
He has had no convictions for any offences within the past 10 years.
DIRECTORS STANDING FOR RE-ELECTION AT THE NINETY-NINTH ANNUAL GENERAL MEETING
i. Pursuant to Article 91:
· Tengku Mohamed Fauzi bin Tengku Abdul Hamid
ii. Pursuant to Article 86:
· Dato' Adnan bin Maaruf
· Dato' Haji Muda bin Mohamed
Chairman's Statement
On behalf of the Board of Directors, I would like to present the Ninety-Ninth
Annual Report incorporating the Audited Financial Statements of Inch Kenneth
Kajang Rubber Public Limited Company and its group of companies ("the Group")
for the year ended 31 December 2008.
PERFORMANCE REVIEW
For the year under review, the Group recorded a pre-tax loss of RM1.459 million
as compared to a pre tax profit of RM0.874 million attained in financial year
2007 with a lower revenue of RM17.550 million as compared to RM19.736 million in
the previous year. The revenue remains low as the Group's plan to embark in new
plantation area and property development is subject to the sale of its land in
Bangi.
Plantation division
The plantation division's revenue increased to RM4.073 million in the 2008
financial year compared with RM3.154 million in the previous financial year
driven by a higher fresh fruits bunches ("FFB") production of 6,034 m/t,
representing an increase of 3.2 % compared with the total production of 5,845
m/t in 2007. The FFB prices were also firmer despite the decline in crude palm
oil ("CPO") prices in the last quarter. The FFB realised at an average price of
RM675 per m/t compared to RM540 per m/t during the previous financial year.
Overall, the plantation division recorded an operating loss of RM0.256 million
in this financial year compared to RM1.938 million loss in 2007.
Investment division
As at 31 December 2008, the Group owns 11,036,680 (24.65%) shareholdings in
Concrete Engineering Products Berhad ("Cepco"), a Second Board Company listed on
Bursa Malaysia Securities Berhad. Following the encouraging performance in 2007,
Cepco recorded a strong rise in revenue of 57.9% from RM149.274 million in 2007
to RM235.675 million in 2008. However, the unexpected credit crunch which
affected the stock market in the year has had a negative impact of RM22.307
million in the form of provision for diminution in its investments activities.
Cepco therefore, reported a loss of RM0.72 million compared to RM15.377 million
profit in 2007, resulting in our share of Cepco loss for the period under review
reduced to RM0.177million from a share of profit of RM3.790 million in 2007.
Tourism division
On its tourism division, the Group's only contributor, Perhentian Island Resort
delivered a slight revenue growth of 17.70% in 2008 to RM5.725 million, driven
by 4% increase in the average room rate and 8% increase in number of rooms sold.
Increased in occupancy rate for available room nights reflects our continuous
efforts to remain as the major player in Perhentian Island, rated as one of the
most beautiful islands in the world. Overall, the total profit after tax of the
resort improved strongly by 154.5% from RM0.136 million in 2007 to RM0.360
million. The hotel's occupancy level for 2008 was at 51% for the nine months of
operation.
Trading division
Our trading division's activities remain almost the same as in the previous
year. Most of the activities were done with our associate Company. However, for
this year, there was a small loss of RM0.279 million (2007 - RM0.057 million
profit). This was mainly due to the tight margin as most of the raw material
prices saw an increase by the second half of 2008.
Property division
As of now, the Group has yet to start on developing the Kajang land due to the
various outstanding issues with the few compulsory acquisitions on the land.
However, the Group is still working closely with the consultants. The land is
currently still part of the plantation arm of the Company.
FUTURE OUTLOOK
At the date of this report, it is anticipated that the Group businesses, like
many others in the world, will face extremely tough operating conditions due to
the global recession. The world's financial markets became volatile following
the mortgage crisis in the United States. A loss of investor confidence in the
world's financial system may cause a significant slowdown or a severe adverse
growth to the world's economies and this could have adverse impact on the
group's business, financial condition, results of operations and prospects.
As such, the Group will try to remain resilient to any adverse impact by
reducing its risk exposure. The Group will also try to embark on new activities
to overcome any negative impact but remains focused on its core business.
The Group's future expansion depends on the total proceeds to be received from
the sale of our land in Bangi. The proceeds will largely be utilized for the
expansion in our plantation, property and tourism division.
In plantation, after a strong rally, the prices of commodities and crude oil
have been volatile since the last quarter of 2008. Crude palm oil (CPO) price
recorded the lowest price level for 2008 on the fourth quarter of 2008, which
was at RM1,606 per tonne or a decline of about 76% as compared to the third
quarter of RM2,826. Based on the current world economic situation, it is
believed that the average price of CPO for 2009 will be RM1,820 per tonne which
implies a decline of about 36% as compared to RM2,855 per tonne in 2008
(Malaysia Palm Oil Board, 4th Quarter Report 2008). Even at this price, the move
to expand our plantation base is justifiable.
Our expansion into the property division will be largely dependent on the market
sentiment in those areas. We believe that for the property division to be a
success, it needs four main factors : location, timing, branding and pricing.
Our consultants views will be a major deciding factor before we start this
division.
Based on the results of Cepco, despite the uncertainties from the global
economic slowdown, we remain optimistic as we believe that they will be able to
secure new projects from the 9MP and other various economic growth corridors
such as Iskandar Malaysia (IM), ECER, NCER, SDC and SCORE. Furthermore, their
sales to overseas markets have also been seeing growth for the past few months.
With the challenging tasks ahead of us to manage in the volatile market
situation, we hope that, barring any unforeseen circumstances, our Group's
performance for the coming financial year ending 31 December 2009 will be
satisfactory.
APPRECIATION
It is my pleasure once again, on behalf of the Board, to extend our sincere
gratitude and appreciation to the management and valued employees of the Group
who have continued with their commitment, dedication and co-operation during the
year. I would also like to express our sincere appreciation for the
long-standing support, co-operation and guidance of our valued customers,
suppliers, business associates, bankers and regulatory authorities.
Lastly, to the shareholders of the Company, we thank you for your faith in us
and for your continuous support to the Group over the years.
DATO' ADNAN BIN MAARUF
Executive Chairman
20 April 2009
Corporate Governance
THE MALAYSIAN CODE ON CORPORATE GOVERNANCE
The Board of Inch Kenneth Kajang Rubber Public Limited Company is committed to
applying the recommendations of the Malaysian Code on Corporate Governance
(revised 2007) ("the Code") and the principles of Best Practices recommended in
the Code to ensure that good corporate governance is practiced throughout the
Group to effectively discharge its responsibilities to protect and enhance
shareholder value. The Board is also committed to strive to maintain a high
level of corporate governance within the Group by ensuring that the highest
standards of corporate culture are practiced throughout. Good corporate
governance is the foundation of the culture and business practices of the Group.
Set out below is a statement on how the Group has applied the principles and
adopted the best practices as laid down in the Code. This statement describes
how the Principles of Good Governance and provisions of the Code are applied by
the Group.
A. DIRECTORS
I THE BOARD
The Board plays a primary role in the conduct and control of the Group's
business affairs. The Board is primarily responsible for the Group's overall
strategic plans for business performance, succession planning, risk management,
investor relations' programmes, internal control, management information
and statutory matters. The Board has an effective working partnership with
management in establishing the strategic direction and goals and in monitoring
its achievement. Five (5) Board meetings were held during the financial year
ended 31 December 2008.In between scheduled meetings, and where
appropriate, Board decisions may be effected via circular resolutions.
The Board delegates certain responsibilities to the Board Committees in order to
enhance business
and operational efficiency as well as efficacy. The Committees are:
Audit Committee
The terms of reference of the Audit Committee are in accordance with the Bursa
Securities Listing Requirements. The terms of reference, which outline the
Committee's functions and duties, are furnished separately in the Annual Report.
The Committee has reviewed the Group's quarterly and annual financial statements
as well as any related party transactions prior to their approval by the
Board. It reviews with the external auditors, Messrs UHY Hacker Young LLP, the
scope of their engagement, their fees as well as the accounting and
reporting matters emanating from their examination of the annual financial
statements. The Committee has also been appraised on significant risk, control,
regulatory and financial matters that have come to the attention of the external
auditors in the course of their audit.
The Committee is aware of the risk management, control and governance processes
relating to critical corporate and operational areas. It also closely monitors
the recommendations made in order to obtain assurance that all key risk and
control concerns have been duly addressed.
More information on the Audit Committee is given in the Audit Committee Report
on pages 18 to 19.
Remuneration Committee
The Remuneration Committee was established on 20 February 2003 and is headed by
Dato' Haji Muda bin Mohamed. The members of the Committee are Encik Abdul Khudus
bin Mohd. Naaim and Encik Ahmad Zakie bin Haji Ahmad Shariff.
A policy framework will be implemented to assess all elements of
the remuneration and other terms of employment for the Executive Chairman. The
Executive Chairman abstains from the deliberations and voting on decisions
in respect of his remuneration at the Board level.
The remuneration of the Non-Executive Directors will be a matter to be decided
by the Board and approved by the shareholders. A full statement on
Directors' remuneration is included on page 11.
Nominating Committee
The Nominating Committee was established on 20 February 2003 and is headed by
Dato' Adnan bin Maaruf. The members of the Committee are YM Tengku Mohamed Fauzi
bin Tengku Abdul Hamid and Encik Abdul Khudus bin Mohd. Naaim.
It is responsible for making recommendations to the Board on all new Board
and Board Committee appointments. The Committee reviews the required mix of
skills and experience of the Directors of the Board in determining the
appropriate Board balance and size of non-executive participation.
II BOARD BALANCE
The Board complies with paragraph 15.02 of the Bursa Securities LR which
requires that at least two (2) Directors or one-third of the Board of the
Company, whichever is the higher, are Independent Directors.The Board has six
(6) members and one (1) alternate member, of whom four (4) are Independent
Non-Executive Directors.
The balance between Independent Non-Executive and Executive Directors, together
with the support from Management, is to ensure that there is an
effective representation for the shareholders. It further ensures that issues of
strategy, performance and resources are fully addressed and investigated to take
into account long-term interest of shareholders, relevant stakeholders and the
community in which the Group conducts its business. The Non-Executive Directors
also bring independent judgement and challenge standards of conduct. The
Independent Non-Executive Directors fulfill a pivotal role in corporate
accountability.None of these Directors participate in the day to day management
in the Group.
The Directors, with their different backgrounds and specialisations,
collectively bring considerable
knowledge, judgement and experience to the Board that has been vital to the
direction of the Group.
No individual or group of individuals dominates the Board's decision making and
the number of Directors reflects fairly the investment of the shareholders.
The Executive Chairman at the Board is Dato' Adnan bin Maaruf.
A statement by the Directors and their responsibilities for preparing the
financial statements is included on page 16.
Board Meetings
The Board meets on a regular basis, and also on other occasions as required, to
approve the annual financial results and any other matters that require
the Board's approval. Due notice is given for all scheduled meetings for all
matters reserved specifically for its decision. Regular and ad-hoc reports and
presentations to the Board and its Audit Committee ensure that the Directors are
supplied timely information on financial, operational, legal, regulatory,
corporate and strategic matters.
During the financial year ended 31 December 2008, the Board held five (5)
meetings, the attendances of which were as follows:
+------------------------------------------------------+-------------+
| Directors | Meetings |
| | Attendance |
+------------------------------------------------------+-------------+
| | |
+------------------------------------------------------+-------------+
| Dato' Adnan bin Maaruf | 5/5 |
+------------------------------------------------------+-------------+
| Ahmad Zakie bin Haji Ahmad Shariff | 5/5 |
+------------------------------------------------------+-------------+
| Dato' Haji Muda bin Mohamed | 5/5 |
+------------------------------------------------------+-------------+
| Abdul Khudus bin Mohd. Naaim | 5/5 |
+------------------------------------------------------+-------------+
| Dr. Radzuan bin A. Rahman | 5/5 |
+------------------------------------------------------+-------------+
| Tengku Mohamed Fauzi bin Tengku Abdul Hamid | 3/5 |
+------------------------------------------------------+-------------+
| Alan Maitland Dewar McWilliam (Alternate to | 1/5 |
+------------------------------------------------------+-------------+
| Tengku Mohamed Fauzi bin Tengku Abdul Hamid) | |
+------------------------------------------------------+-------------+
* Tengku Mohamed Fauzi bin Tengku Abdul Hamid ceased as an Alternate
Director on 27 June 2008 and was
re-appointed as a Director on 23
January 2009.
# Alan Maitland Dewar McWillliam vacated office as a Director
on 27 June 2008 and was re-appointed as an
Alternate Director on 16
February 2009.
All meetings were held at 22nd Floor Menara Promet, Jalan Sultan Ismail,
50250 Kuala Lumpur.
Directors' Training
All the Directors have attended and completed the Mandatory Accreditation
Programme conducted by the Research Institute of Investment Analysts
Malaysia (now known as Bursatra Sdn Bhd).
Under the revised Bursa Securities LR, the Board assumes the onus of determining
or overseeing the training needs of their Directors from 2005 onwards. Directors
are encouraged to attend various external professional programmes necessary to
ensure that they are kept abreast on various issues facing the changing
business environment within which the Group operates.
During the year, all the Directors have attended various training programmes
under the Continuing Education Programmes pursuant to the requirements of Bursa
Malaysia Securities Sdn Bhd. The Directors will continue to undergo other
relevant training programmes to further enhance their skills and knowledge.
III SUPPLY OF INFORMATION TO THE BOARD
All Directors have full and timely access to information, with Board papers
distributed prior to the scheduled Board meetings. The Board papers are
comprehensive and encompass both quantitative and qualitative information so
that informed decisions are made.These Board papers include the agenda
and information covering strategic, operational, financial and compliance
matters. The Board requests additional information or variations to regular
reporting, as it requires. In most instances, the senior management of the
Company are invited to be in attendance at Board meetings to furnish
clarification on issues that may be raised by the Board.
The Directors also have direct access to the advice and services of the Company
Secretary in furtherance of their duties and may take independent professional
advice where necessary and in appropriate circumstances at the Group's expense.
IV APPOINTMENTS TO THE BOARD
Responsibility for making recommendations to the Board for Board appointment
lies with the Nomination and Remuneration Committees. This includes subsidiaries
and associated companies. The Nomination and Remuneration Committees consider
the required mix of skills and experience that the Directors should bring to the
Board in making these recommendations. The Nomination Committee is responsible,
inter alia, for making recommendations to the Board on new nominees for the
Board including Board Committees and for assessing Directors on an ongoing
basis. The Nomination Committee also reviews the Board's required mix of skills
and experience and other qualities, including core competencies which
Non-Executive Directors should bring to the Board.
V RE-ELECTION
All Directors offer themselves, on a rotation basis, for re-election by
shareholders at the Annual General Meetings at least once every three (3) years.
According to the Company's Articles of Association, an election of Directors
shall take place each year. At each Annual General Meeting one-third of the
Directors for the time being (or if, their number is not a multiple of three,
the number nearest to but no greater than one-third) shall retire from office
provided always that all Directors shall retire from office once at least in
each three (3) years but shall be eligible for re-election.
At the forthcoming Annual General Meeting, the following Directors who retire
have offered themselves for re-election:
i. Pursuant to Article 91:
· Tengku Mohamed Fauzi bin Tengku Abdul Hamid
ii. Pursuant to Article 86:
· Dato' Adnan bin Maaruf
· Dato' Haji Muda bin Mohamed
B. DIRECTORS' REMUNERATION
I THE LEVEL AND MAKE-UP OF REMUNERATION
The Remuneration Committee ("the Committee") endeavours to ensure that the
remuneration package offered is competitive to attract, retain and
motivate Executive Directors and senior executives of high caliber who will
strive to achieve the Group's objectives.
The package may include basic salary, benefits and annual bonuses that will be
based on the individual performance and dependent upon the achievement of
predetermined targets. The Directors' fees and meeting allowances paid to all
Directors, individually and per meeting respectively, are disclosed in note
11 to the financial statements.
Remuneration packages for the Executive Directors are subject to annual reviews
by the Committee, based on the Group's performance, economic conditions and the
need to reward individual performance. Annual bonuses are reviewed by the
Committee on an annual basis and are determined based on the
financial performance of the Group against the backdrop of the Group's business
objectives.
There were no performance-related bonuses or other benefits given to any of the
Directors during the 2008 financial year.
The fees for the Non-Executive Directors are determined by the Board and
approved by the shareholders.The only other remuneration of the
Non-Executive Directors is meeting allowances, which are set by the Board having
taken advice on appropriate levels.The Company's policy is for all Executive
Directors to have service contracts of employment of one year's duration and
with provision for termination on not more than twelve (12) months notice.
There is a provision in the service contracts for Executive Directors with
regard to compensation in the event of loss of office whereby early termination
is subject to payment in lieu of the notice period. There are no other
provisions in the service contracts that would affect any liability of
the Company in the event of early termination.
The relevant terms in the service contract of the Executive Director is as
follows:
Name: Dato' Adnan bin Maaruf
Date of contract: 5 September 2008
Unexpired terms: 12 months
Notice period: 12 months
The Company does not have any pension scheme for its employees and Directors.
The Company does, however, make the statutory contribution for its employees
to the relevant regulatory body, the Employees Provident Funds Board of
Malaysia. The Fund operates as a defined contribution scheme. The Company does
not have any long term incentive plans or share option schemes for its employees
and Directors.
II PROCEDURE
The remuneration packages are determined by the Remuneration Committee which was
set up on 24 February 2003. The Committee is chaired by Dato' Haji Muda bin
Mohamed and its other members are Encik Abdul Khudus bin Mohd. Naaim and Encik
Ahmad Zakie bin Haji Ahmad Shariff.
The Committee is responsible for making recommendations to the Board, within
agreed terms of reference, on an overall remuneration package for Executive
Directors and other senior executives. The Committee has not engaged any person
to advise and assist on any matters relating to the Directors' remuneration
during 2008.
III DISCLOSURE - INFORMATION SUBJECT TO AUDIT
The Directors' total remuneration comprises the following:
+----------------------+---------+----------+------------+---------+--------+
| | Basic |Benefits | | | |
+----------------------+---------+----------+------------+---------+--------+
| | Salary | & | Meeting | Total | Total |
| | & | | | | |
+----------------------+---------+----------+------------+---------+--------+
| | Fees | Bonuses |Allowances | 2008 | 2007 |
+----------------------+---------+----------+------------+---------+--------+
| | (RM) | (RM) | (RM) | (RM) | (RM) |
+----------------------+---------+----------+------------+---------+--------+
| | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Executive Director | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Dato' Adnan bin | 12,000 | - | 3,000 | 15,000 | 14,500 |
| Maaruf | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Non-Executive | | | | | |
| Director | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Ahmad Zakie bin Haji | 8,000 | - | 4,250 | 12,250 | 10,750 |
| Ahmad Shariff | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Dato' Haji Muda bin | 8,000 | - | 4,250 | 12,250 | 11,750 |
| Mohamed | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Abdul Khudus bin | 8,000 | - | 4,250 | 12,250 | 11,750 |
| Mohd. Naaim | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Dr. Radzuan bin A. | 8,000 | - | 3,000 | 11,000 | 10,500 |
| Rahman | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Tengku Mohamed Fauzi | - | - | 2,000 | 2,000 | 2,000 |
| bin Tengku Abdul | | | | | |
| Hamid | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Alan Maitland Dewar | 8,000 | - | 1,000 | 9,000 | 8,000 |
| McWilliam | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| | 52,000 | - | 21,750 | 73,750 | 69,250 |
+----------------------+---------+----------+------------+---------+--------+
| | | | | | |
+----------------------+---------+----------+------------+---------+--------+
Pension entitlements
As the Company does not have a pension scheme in place, none of the Directors
have pension entitlements.
Long-term incentive plans
As the Company does not have a long-term incentive plan in place, no Directors
have any interest in a long-term incentive plan.
Interest in share options
As the Company does not have a share option scheme in place, no Directors have
any interest in share options.
Excess retirement benefits of Directors and past Directors
As the Company does not have a retirement benefit scheme in place, no Directors
have any retirement benefits.
Compensation for past Directors
There was no compensation made to the past Directors in respect of loss of
office and pensions.
IV PERFORMANCE GRAPH
The Company's performance graph as required by the Directors' Remuneration
Report Regulations 2002 in the United Kingdom is shown in the Five-Year Group
Financial Highlights section on page 22.
C SHAREHOLDERS
I DIALOGUE BETWEEN THE COMPANY AND ITS INVESTORS
The Group believes in clear communications with its shareholders. The Annual
Report and the quarterly announcements are the primary methods of communication
to report the Group's business activities and financial performance to all
shareholders.Shareholders also have the opportunity to put questions at the
Annual General Meeting where the Directors are available to discuss aspects of
the Group's business activities and performance. The shareholders may also
forward their questions to us via e-mail ikkr@po.jaring.my or contact us at the
Principal Office in Malaysia.
II THE ANNUAL GENERAL MEETING
The Annual General Meeting is the principal platform for dialogue with
shareholders, wherein, the Board presents the operations and performance of
the Group. During the meeting, shareholders are given every opportunity to
enquire and comment on matters relating to the Group's business. The
Chairman, members of the Board and senior management personnel are available to
respond to shareholders' queries during this meeting.
D ACCOUNTABILITY AND AUDIT
I FINANCIAL REPORTING
The Board aims to provide and present a balanced and meaningful assessment of
the Group's financial performance and prospects at the end of the financial
year, primarily through the annual financial statements and quarterly
announcements of results to shareholders as well as the Chairman's Statement in
the Annual Report. The Audit Committee assists the Board by reviewing the
disclosure information to ensure completeness, accuracy and validity.
II INTERNAL CONTROL
The Directors acknowledge their responsibility for the Group's system of
internal controls covering not only financial controls but also operational and
compliance controls, as well as risk management. The internal control system
involves each subsidiary business and is designed to meet the needs of each
subsidiary, to ensure that the risks faced by the business in pursuit of its
objectives are identified and managed at known acceptable levels. The Group
will be continuously reviewing the adequacy and integrity of its system
of internal control. A full statement on internal control is included in pages
20 and 21.
The Board also acknowledges the internal audit function as an integral part of
an effective system of corporate governance. In this regard, the Board
has taken steps to establish a proper internal audit division to undertake the
internal audit functions within the Group.
III RELATIONSHIP WITH AUDITORS
The Board, via the establishment of the Audit Committee, maintains a formal and
transparent relationship with the Company's auditors. The roles of the Audit
Committee in relation to the auditors are detailed in the Audit Committee Report
in this Annual Report.
COMPLIANCE STATEMENT
The Board is satisfied that the Company has in 2008 complied with the best
practices of the Code.
ADDITIONAL COMPLIANCE INFORMATION
Share Buy-backs
During the 2008 financial year, there were no share buy-backs by the Company.
Options, Warrants or Convertible Securities
There was no grant or exercise of options, warrants or convertible securities
during the 2008 financial year.
American Depository Receipt ("ADR") or Global Depository Receipt ("GDR")
Programme
The Company did not sponsor any ADR or GDR programme during the 2008 financial
year.
Imposition of Sanctions and/or Penalties
There were no public sanctions and/or penalties imposed on the Company and its
subsidiaries, Directors or management by any regulatory bodies during the 2008
financial year.
Non-Audit Fees
There were no fees payable to the auditors, Messrs UHY Hacker Young LLP for
non-audit services, during the financial year ended 31 December 2008.
Profit Estimate, Forecast, Projection, and Variation in Results
There were no variations of 10% or more between the audited results for the
financial year ended 31 December 2008 and the unaudited results for the year
ended 31 December 2008 of the Group previously announced.The Company did not
make any release on profit estimates, forecasts or projections for the
financial year.
Profit Guarantee
The Company did not give any profit guarantees during the 2008 financial year.
Material Contracts
There were no material contracts entered into by the Company and its
subsidiaries involving Directors and major shareholders' interests.
Revaluation Policy on Landed Properties
The Group revalues its landed properties whenever the market value of the
revalued assets has changed materially from their carrying values and at least
every five years.
Employee Share Option Scheme ("ESOS")
There were no ESOS offered during the financial year ended 31 December 2008.
Corporate Social Responsibility ("CSR")
The Group is aware of its responsibility to its shareholders, environment and
the community. Details of CSR are disclosed in page 17.
Recurrent Related Party Transactions
There were no transactions with related parties undertaken by the Group during
the period under review except as disclosed in note 28 to the financial
statements.
RESPONSIBILITY STATEMENT FOR PREPARING THE ANNUAL AUDITED FINANCIAL STATEMENTS
The Board has seen and approved the Annual Report and Audited Financial
Statements for the year ended 31 December 2008 and collectively and
individually accept full responsibility for the accuracy of the information
given and confirm that after making reasonable enquiries to the best of their
knowledge and belief, there are no other facts, the omission of which would make
any statement or information therein misleading.
This corporate governance statement, including the information on Directors'
Remuneration, is made in accordance with the resolution of the Board of
Directors dated 20 April 2009.
DATO' ADNAN BIN MAARUF
Executive Chairman
Corporate Social Responsibilities
Corporate social responsibility ("CSR") defines organisational consideration of
multiple stakeholders and global impact, beyond simple focus on maximization of
shareholder's wealth. The Board of Directors of the Group, is cognizant of the
fact that it is an integral part of the society in which it operates. Hence IKKR
is fully committed to conducting its activities in the most economically,
socially and environmentally sustainable manner. CSR activities are carried out
based on the Group's values in guiding the decision making and operations.
In line with Bursa Malaysia framework of CSR, our social responsibilities covers
the following:
ENVIRONMENT
The Group's resort in Perhentian Island is nestled on a private beach, amidst a
forest reserve known for its natural beauty, bountiful corals and marine life.
Every effort was made to ensure that the rainforest was preserved during the
construction on the island and that no future development would be undertaken
that would in anyway compromise this rainforest. The cleanliness of the pristine
water and white sandy beaches has been maintained to this day. In addition, we
have provided facilities for non-government agencies such as the World Wildlife
Fund for their research purposes. We also place high importance on developing
the facilities without disturbing the environment. We encourage our employees as
well as customers and hotel guests to share the same environmental vision of
sustainability and protection. High importance is also placed on the natural
habitat of the wild life and marine life.
WORKPLACE
Our Group values its employees by providing a safe working environment.
Recognising their social needs, quarters are provided to staff and workers on
the plantation estates as well as at the tourist resort with various facilities.
Further, the Group acknowledges the need to provide a healthy and balanced
lifestyle to its employees. Social events such as team building are also
organized to promote greater teamwork as well as encourage interactions and
communications amongst employees. The Group acknowledges the need to provide
the opportunities for staff interaction by having regular social gathering for
enhancement of relationship among employees and creation of closer rapport
between one another. Training is provided to the employees as the Group believes
that proper training and development programme is necessary in developing and
upgrading workers' skills and knowledge to achieve an optimal performance. The
training comprises both technical, soft skills and includes grooming future
leaders.
COMMUNITY
As a good corporate citizen, we are very conscious of our responsibilities and
we often interact with the local communities in the areas of our business
operations. The Group has made contributions to the village committee at
Perhentian Island as and when the need arises and also makes it a priority to
employ workers from the nearby village.
The Group also provides internship training programmes to local degree and
diploma students for knowledge enrichment and to enable such students to better
prepare and position themselves for future employment.
MARKETPLACE
The Group is always ensuring that it remains dynamic where the market needs are
concerned. We always try our best to adhere to the needs of our customers as
well as the relevant authorities. We were very supportive when the Government
wanted to impose windfall profit levy from the sale of CPO. We were also always
trying to accommodate the needs of our guests at the resort to ensure that they
get the value for money.
Hence, at the Group, we take every opportunity to integrate our social
responsibilities into the way we manage our business and operations. We seek to
make continual improvements in our business policies to sustain the development
and implementation of our CSR programs.
Audit Committee Report
The Directors are pleased to present the Audit Committee Report of the Company
in respect of the financial year ended 31 December 2008.
A. COMPOSITION
The composition of the Audit Committee and designation of the Directors are as
follows:
Members of the Committee
Ahmad Zakie bin Haji Ahmad Shariff
Chairman (Independent Non-Executive Director)
Dato' Haji Muda bin Mohamed
Member (Independent Non-Executive Director)
Abdul Khudus bin Mohd. Naaim
Member (Non-Independent Non-Executive Director)
Secretary to the Committee
Lee Thai Thye (LS 0000737)
B. TERMS OF REFERENCE
The terms of reference of the Audit Committee comprise mainly the constitution,
membership, authority, duties and responsibilities of the Audit Committee.
1. Constitution
The Board of Directors has established a Committee of the Board known as the
Audit Committee.
2. Membership and Meetings
The Committee was appointed by the Directors and shall at all times comprise not
less than three (3) members of whom the majority are independent. All members of
the Audit Committee shall also be Non-Executive Directors, financially literate,
and at least one of the members is a member of an accounting association or
body. The Chairman of the Committee must be an Independent Non-Executive
Director and shall be appointed by the Committee members. The Company Secretary
shall act as the secretary for the Committee. There shall be at least four (4)
meetings per year.
3. Attendance at Audit Committee Meetings
Attendance at Audit Committee Meetings during 2008 was as
follows:
+------------------------------------------------------------
=--+-----------------+
| Directors
| Meetings |
|
| Attendance
|
+----------------------------------------------------------------+---------
=------+
| |
|
+----------------------------------------------------------------+---------
=------+
| Ahmad Zakie bin Haji Ahmad Shariff |
5/5
|
+----------------------------------------------------------------+---------
=------+
| Dato' Haji Muda bin Mohamed |
5/5
|
+----------------------------------------------------------------+---------
=------+
| Abdul Khudus bin Mohd. Naaim |
5/5
|
+----------------------------------------------------------------+---------
=------+
4. Authority
The Audit Committee has the authority to investigate any activity within its
terms of reference, and shall obtain the cooperation of the other Board members,
employees and external auditors, and any other external professional bodies
which it considers necessary.
5. Duties and Responsibilities
The Audit Committee's main duties and responsibilities are as follows:
a) Review the audit plan with the external auditors.
b) Review with the external auditors, the adequacy and effectiveness of
the accounting and internal control systems.
c) Act upon problems and reservations arising from interim and final
audits.
d) Review the financial statements prior to the Directors' approval to
ensure a fair and full presentation of the financial affairs of the Company and
the Group.
e) Assist in establishing appropriate control procedures.
f) Review internal audit reports and highlight to the Board any
significant issues.
g) Assist in conducting of management audits or other sensitive matters.
h) Recommendations to retain or replace the firm of external auditors
and the agreement of the audit fee for the ensuing year.
6. Summary of Activities
The Committee met five (5) times during the year for the following purposes:
a) To review the financial statements before the quarterly announcements
to the Bursa Securities, Singapore Exchange Securities Trading Limited
("SGX-ST") and London Stock Exchange plc ("LSE");
b) To review the year-end financial statements;
c) To discuss with the external auditors the audit plan and scope for
the year as well as the audit procedures undertaken; and
d) To review reports prepared by estate managers on the state of
internal controls of the estates.
7. Internal Audit Function
The Group's internal control systems are reviewed by the internal auditor,
together with external consultants. Their principal responsibility is to assist
the Audit Committee in providing independent assessments for the adequacy,
efficiency and effectiveness of the internal control systems to ensure
compliance with the systems and standard operating procedures in the Group.
Statement on Internal Control
The Board is pleased to make the following disclosures pursuant to Paragraph
15.27(b) of the Bursa Securities LR, which requires the Board of Directors of
public listed companies to include in its annual report "a statement about the
state of internal control of the listed issuer as a group". The Board confirms
that there is an ongoing process for identifying, evaluating and managing the
significant risks faced by the Group, and that the process will be
regularly reviewed by the Board and accords with 'The Statement on Internal
Control - Guidance For Directors of Public Listed Companies'.
BOARD'S RESPONSIBILITY
In accordance with Principle D II in Part 1 of the Malaysian Code on Corporate
Governance, the Board is committed to maintaining a sound system of internal
control to safeguard shareholders' investments and the Group's assets.
Accordingly, the Board acknowledges its responsibility for the Group's overall
system of internal control which includes the establishment of an appropriate
control environment and framework as well as reviewing its adequacy and
integrity. However, it should be noted that due to the limitations that are
inherent in any system of internal control such a system is designed to manage
rather than eliminate the risk of failure to achieve the Group's business
objectives. Accordingly, it can only provide reasonable and not absolute
assurance against material misstatement or loss.
REVIEW PROCESS FOR INTERNAL CONTROL SYSTEM
In view of the size and nature of the Group's operations, the Group has an
in-house function for the review of the Group's internal control system, which
forms part of the internal audit function. Currently the functions are focused
on the most active subsidiary. An external consultant was also contracted to
conduct certain system checks on the revenue earned by Perhentian Island Resort
Sdn. Bhd.
The reports will be presented to the Audit Committee. Being an independent
function, the reports presented must be with impartiality, proficiency and due
professional care.
The internal audit function facilitates the Board, through the Audit Committee,
in carrying out its responsibility to review and evaluate the adequacy and
integrity of the Group's internal control systems. The Board reviews
matters pertaining to internal control which among others, includes the adequacy
and integrity of the internal control systems of the Group. Reviews are carried
out annually to provide independent assessments on the adequacy, efficiency
and effectiveness of the Group's internal control systems in anticipating
potential risk exposures over key business systems and processes and in
controlling the proper conduct of businesses within the Group.
The internal audit function adopts a risk-based approach whereby the strategies
and plans are prepared based on the risk profile of the Group. The plans will be
presented to the Audit Committee for approval annually. The resulting
reports will be reviewed by the Audit Committee and forwarded to the management
for attention and necessary corrective actions. The management is responsible
for ensuring any corrective actions on reported weaknesses are taken within the
required time frame.
OTHER CONTROL PROCEDURES
Apart from internal audit, there is an organisational structure with formally
defined lines of responsibility and delegation of authority. This will provide a
process of hierarchical reporting for an auditable trail of accountability.
The monitoring and management of the Group is delegated to the Executive Board
member and senior operational management. The Executive Board member, through
his involvement in the business operations and attendance at senior management
level meetings, manages and monitors the Group's financial performance, key
performance indicators, operational effectiveness and efficiency, discusses and
resolves significant business issues and ensures compliance with applicable
laws, regulations, rules, directives and guidelines. These senior management
meetings serve as a two-way platform for the Board, through the Executive
Board member, to communicate and address significant matters in relation to the
Group's business and financial affairs and provide updates on significant
changes in the businesses and the external environment that may result in any
significant risks to the Group.
Internal control procedures are set out in standard operating practice and
business process manuals and internal memos to serve as internal control
guidance for proper measures to be undertaken and are subject to regular review,
enhancement and improvement by the Internal Auditor.
This statement on internal control is made in accordance with the resolution of
the Board of Directors dated 20 April 2009.
DATO' ADNAN BIN MAARUF
Executive Chairman
Five Year Group Financial Highlights
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | 2008 | 2007 | 2006 | 2005 | 2004 |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| Financial Performance | | | | | |
+----------------------------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| Revenue | | 17,550 | 19,736 | 19,073 | 9,787 | 5,709 |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| (Loss)/profit | | (1,459) | 874 | (10,598) | (23,943) | 26,345 |
| before taxation | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| (Loss)/profit | | (1,540) | 697 | (10,878) | (24,045) | 24,289 |
| for the year | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| (Losses)/earnings | sen | (0.37) | 0.17 | (2.59) | (0.10) | 3.07 |
| per share | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| Borrowings | | 20,030 | 23,840 | 11,300 | 20,300 | - |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| Debt-equity | times | 0.04 | 0.04 | 0.03 | 0.06 | - |
| ratios | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| Paid-up share |shares | 420,750,000 | 420,750,000 | 420,750,000 | 234,277,397* | 8,250,000 |
| capital | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| Shareholders' | | 486,017 | 540,263 | 338,974 | 349,852 | 374,501 |
| equity | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| Net assets per | RM | 1.15 | 1.28 | 0.81 | 0.83 | 0.89 |
| share | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
| | | | | | | |
+-------------------+--------+-------------+-------------+-------------+--------------+-----------+
*weighted average
All figures are in RM thousands unless otherwise stated.
SHARE PRICE PERFORMANCE GRAPH
The graph below shows the movement of the Company's share price on Bursa
Securities against the corresponding change in the Kuala Lumpur Composite Index
("KLCI"). The KLCI was selected as it represents a broad equity market index in
which the Company is a constituent member.
Click on, or paste the following link into your web browser, to view the
associated PDF document.
http://www.rns-pdf.londonstockexchange.com/rns/4394R_-2009-4-30.pdf
Five Year Group Financial Highlights (Cont'd)
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
_______________
The Directors have pleasure in presenting their report, together with the
audited financial statements of Inch Kenneth Kajang Rubber plc ("the Company")
and its subsidiaries (together "the Group") for the financial year ended 31
December 2008.
Principal activities
The Company is incorporated in Scotland under the United Kingdom's Companies Act
1985, with company number SC007574, as a public company limited by shares.
The Company is involved in investment holding and carries on the business of an
oil palm grower in Selangor, Malaysia.
The subsidiary undertakings are engaged in the operations of a tourist resort,
retailing building supplies, property development and leasing of properties in
Malaysia.
A more detailed review of the Group's operations is set out in the Chairman's
Statement.
Group structure
The Group operates through its Parent and subsidiary companies, details of which
are set out in note 16 to these financial statements.
There were no changes in the Group's structure during 2008.
Estates
The total area of the Group's estates as at 31 December 2008 is as follows:
+------------------------------------------------------+-----------+--+-----------+
| | Hectares |
+------------------------------------------------------+--------------------------+
| | 2008 | | 2007 |
+------------------------------------------------------+-----------+--+-----------+
| | | | |
+------------------------------------------------------+-----------+--+-----------+
| Oil Palm (Mature) | 372 | | 372 |
+------------------------------------------------------+-----------+--+-----------+
| Roads, buildings, gardens, nurseries and wasteland | 12 | | 12 |
+------------------------------------------------------+-----------+--+-----------+
| | | | |
+------------------------------------------------------+-----------+--+-----------+
| Total | 384 | | 384 |
+------------------------------------------------------+-----------+--+-----------+
The yields from the plantation activity for the year ended 31 December 2008 were
as follows:
+----------------------------------------+-------------------+---------+-----------+
| Harvested crops | Fresh fruit | Oil | Kernel |
| | bunches | | |
+----------------------------------------+-------------------+---------+-----------+
| | | | |
+----------------------------------------+-------------------+---------+-----------+
| 2008 (tonnes) | 6,034 | 1,261 | 311 |
+----------------------------------------+-------------------+---------+-----------+
| 2007 (tonnes) | 5,845 | 1,230 | 328 |
+----------------------------------------+-------------------+---------+-----------+
| | | | |
+----------------------------------------+-------------------+---------+-----------+
Results and dividends
The Group's results for the year are set out on page 34. The Group's
loss attributable to shareholders of the Company for the financial year ended 31
December 2008 amounted to RM1,540,000 (2007: profit of RM697,000).
The Directors do not recommend the payment of a dividend for the financial year
ended 31 December 2008 (2007: Nil).
In the opinion of the Directors, the results of the operations of the Group and
of the Company during the financial year were not substantially affected by any
item, transaction or event of a material and unusual nature.
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
_______________
Significant events
There were no significant events during 2008.
Review and performance of the business
The Group's operating results for the year and financial position at 31 December
2008 are considered by the Directors as better than the previous year.
The plantation division saw revenue growth of 29% to RM4.073 million
(2007: RM3.154 million) and our production of FFB of 6,034 metric
tonnes (2007:5,845 metric tonnes) was higher than the previous year. The tourism
division saw revenue growth of 17.70% to RM5.725 million (2007: RM4.864million)
due to higher average room rates and number of rooms sold . The property
division has not progressed as well as expected as the master plan
has not been submitted yet. The building material trading division's revenue
decreased from RM11.442 million in 2007 to RM7.568 million in 2008. The main
drop in overall results for 2008 is due to the share of loss of the associate
RM0.177 million compared to share of profit of RM3.790 million in 2007.
Future developments and prospects
Our planned sale of the Bangi land is still on track and we hope that it can be
confirmed within the first half of 2009. Once this is concluded, we will then be
able to focus on the expansion of our plantation sector either into Sabah,
Sarawak, Indonesia or other ASEAN countries. Due to the current global economic
crisis, we will carry out any necessary extensive due diligence exercise in
order to avoid any major risks.
Financial position of the Company and Group at the year end
Despite the relatively low business activities of the Group, the cash position
at the end of the 2008 financial year was RM2.3million. We believe that the
financial position will significantly improve once our future plans above come
into place.
At 31 December 2008, the Group had total assets of RM513.774 million which was
lower compared to RM571.152 million in 2007 due mainly to a revaluation deficit
of the Group's land. The Group had relatively low levels of liabilities
of RM27.757 million in 2008 compared to RM30.889 million in 2007. The resulting
net assets were RM486.017 million at 31 December 2008 (2007 - RM540.263
million).
Post balance sheet events
No events have occurred since the balance sheet date which significantly affects
the Company or the Group.
Directors
The Directors of the Company who held office during the year and at the date of
this report are:
Dato' Adnan bin Maaruf
Ahmad Zakie bin Haji Ahmad Shariff
Dato' Haji Muda bin Mohamed
Abdul Khudus bin Mohd. Naaim
Dr. Radzuan bin A. Rahman
Tengku Mohamed Fauzi bin Tengku Abdul Hamid (Resigned on 27 June 2008;
Re-appointed on 23.1.2009)
Mr Alan Maitland Dewar McWilliam (Resigned on 27 June
2008; Re-appointed on 16.2.2009)
(alternate to Tengku Mohamed Fauzi bin Tengku Abdul Hamid)
In accordance with Article 91 of the Company's Articles of Association, Tengku
Mohamed Fauzi bin Tengku Abdul Hamid retires from the Board at the forthcoming
Annual General Meeting, and being eligible, offer himself for re-election.
In accordance with Article 86 of the Company's Articles of Association, Dato'
Adnan bin Maaruf and Dato' Haji Muda bin Mohamed retire from the Board at the
forthcoming Annual General Meeting, and being eligible, offer themselves for
re-election.
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
_______________
Directors' interestsNeither at the end of the financial year ended 31 December
2008, nor at any time during that year, was there any arrangement to which the
Company was a party, whereby the Directors could acquire benefits by means of
the acquisition of shares in or debentures of, the Company or Group
undertakings.
Since the end of the previous financial year, no Director has received or become
entitled to receive any benefits (other than benefits included in the aggregate
amount of emoluments received by the Directors as shown in the financial
statements) by reason of a contract made by the Company or Group undertakings
with any Director or with a firm of which he is a member, or with a company in
which he has a substantial financial interest.
None of the Directors who held office during the financial year and to the date
of this report, together with their immediate families, had any interests in the
shares of the Company or Group undertakings.
Substantial shareholders
The Company has been notified, in accordance with Chapter 5 of the United
Kingdom's FSA's Disclosure and Transparency Rules, of the under noted interests
in its ordinary shares as at 16 April 2009 by 3% shareholders and above:
+-----------------------------------------------------------+------------+---------+
| | Number of | % of |
+-----------------------------------------------------------+------------+---------+
| | shares of | issued |
| | | |
+-----------------------------------------------------------+------------+---------+
| Name | 10p each | capital |
+-----------------------------------------------------------+------------+---------+
| Concrete Engineering Products Berhad | 55,032,400 | 13.08% |
+-----------------------------------------------------------+------------+---------+
| Hamptons Property Sdn Bhd | 49,327,700 | 11.72% |
+-----------------------------------------------------------+------------+---------+
| FA Securities Sdn Bhd | 29,672,500 | 7.05% |
+-----------------------------------------------------------+------------+---------+
| Euston Technologies Sdn Bhd | 22,560,000 | 5.36% |
+-----------------------------------------------------------+------------+---------+
No other person has notified an interest in the ordinary shares of the Company
required to be disclosed to the Company in accordance with the UK's Companies
Act 1985.
Creditor payment policy and practice
It is the Group's policy that payments to suppliers are made in accordance with
those terms and conditions agreed between the Group and its suppliers, provided
that all trading terms and conditions have been complied with.
At 31 December 2008, the Group had an average of 67 days (2007 - 61 days)
purchases outstanding in trade creditors.
Health and Safety
All aspects of health and safety at the Group's plantations are handled by our
agent, Sime Darby Seeds and Agricultural Services Sdn Bhd, and reviewed by the
Board. The Company also places a high level of importance on health and safety
aspects, at its subsidiary, Perhentian Island Resort Sdn Bhd. As it is a resort
business, any health and safety issues may be detrimental to its image and hence
may affect revenues achieved.
Employees
The number of staff employed by the Group at the year end was 113 (2007 - 133).
Staff turnover rates are low as we strive to provide the best possible benefits
and opportunities for all employees. At the resort and estates, we provide
employees with full quarters and required facilities, to provide a conducive
environment, both for work and entertainment. We also provide all employees with
insurance coverage.
Political and charitable donations
There were no political or charitable donations made by the Group during the
year ended 31 December 2008 except for community support by the subsidiary,
Perhentian Island Resort Sdn Bhd, to the village committee, as and when the need
arises.
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
_______________
Derivatives and other financial instruments
The Group's financial instruments consist of cash and short term deposits,
equity investments, borrowings, receivables and payables. The main purpose of
these financial instruments is to finance the Group's operations and
investments. The Group has other financial instruments, such as trade debtors
and trade creditors that arise directly from its operations.
The main risks arising from the Group's financial instruments are interest rate
risk, liquidity risk, foreign currency risk and market price risk. The
magnitudes of these risks are detailed in note 27 to the financial statements.
The Board reviews and agrees policies for managing each of these risks as and
when they arise.
Interest rate risk
The Group's primary interest rate risk relates to short term borrowing interest
bearing debt.
The Group also has cash and bank balances and deposits placed with creditworthy
licensed banks. The Group manages its interest rate risks by placing such
balances on varying maturities and interest rate terms.
Liquidity risk
The Group's objective is to maintain a balance of funding and flexibility
through the use of finance leases and short term borrowings.
The Group's policy is to arrange revolving credit for working capital and
finance leases for purpose of asset acquisition.
Foreign currency risk
The Group does not have any structural currency exposures as all its investments
and operations are in Malaysia.
The Group is not affected by any foreign currency risks as the crude palm oil
prices are quoted in Ringgit Malaysia. The Group receives proceeds from the
crude palm oil sales in Ringgit Malaysia. The Group does not enter into any
forward currency contracts.
Market price risk
It is the Group's objective to hold investments in quoted equity shares for long
term purposes and maximise returns from these investments.
The Group manages its market risks associated with the quoted equity shares on
its own and does not engage the services of fund managers. The Group monitors
the fluctuation of the indices on the Bursa Malaysia Securities Bhd., and
trading is kept at a minimum.
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
_______________
Principal risks and uncertainties facing the businesses
The principal risks and uncertainties facing the Group are:
i) Exposure to the risks inherent in the property development industry
The Group is getting involved in property development. It will be exposed to
the cyclical performance caused by the changes in the domestic and global
economic conditions, which give rise to intense competition among the local
players and new entrants in the property market. In addition, its profitability
may also be affected by the changes in the economic and political environment
such as changes in taxation, inflation, foreign exchange rates, government
policies, population growth and accounting policies.
ii) Exposure to the risks inherent to the oil palm industry
As the Group is involved in the oil palm industry, it is also susceptible to
certain business risks inherent to that industry as well as general business
risks, which include but are not limited to:
(i) constraints and rising costs of labour supply and raw materials for the
plantations;
(ii)effects of poor weather;
(iii)commodity price fluctuations;
(iv)threat of substitute products; and
(v)change in the regulatory, economic and business conditions.
iii) Exposure to the risks inherent to the tourism industry
The Group is also subject to risks inherent to the hotel and tourism sector.
These may include, amongst others, general economic downturns in the global and
regional economies, rise of uncertainties from terrorism activities and war,
socio-political instability, a decrease in demand and an oversupply of hotel and
resort rooms, an increase in the operating costs due to inflation and other
factors such as an increase in energy and labour costs, labour supply shortages,
changes in credit conditions, changes in customers' tastes and preference and
the collectibility of debts that may have adverse effects on our resort business
and operations.
Our financial risk management objectives are to ensure sufficient working
capital for the Company and the Group. This is achieved by careful management of
our cash balances and, where necessary, by obtaining short term bank finance.
Going concern
After making appropriate enquiries and examining those areas which could give
rise to financial exposure the Directors are satisfied that no material or
significant exposures exist and that the Group has adequate resources to
continue its operations for the foreseeable future. For this reason, and as
further discussed in note 2.1, the Directors continue to adopt the going concern
basis in preparing the Company's and Group's financial statements.
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
_______________
Auditors
In accordance with Section 385 of the United Kingdom's Companies Act 1985, a
resolution proposing that UHY Hacker Young LLP be re-appointed as auditors of
the Company and that the Directors be authorized to fix their remuneration will
be put to the next Annual General Meeting.
On behalf of the Board
Dato' Adnan Bin Maaruf
Director
Ahmad Zakie bin Haji Ahmad Shariff
Director
Kuala Lumpur, Malaysia
20 April 2009
STATEMENT OF RESPONSIBILITIES OF THOSE CHARGED WITH GOVERNANCE
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
_______________
The Directors are responsible for preparing the Annual Report and the financial
statements in accordance with applicable United Kingdom company law and
International Financial Reporting Standards as adopted by the European Union
("IFRS").
The Directors are required to prepare financial statements for each financial
year which give a true and fair view of the state of affairs of the Group and of
the Company and of the profit or loss and cash flows of the Group and of the
Company for that period. In preparing those financial statements, the Directors
are required to:
· select suitable accounting policies and then apply them consistently;
· make judgments and estimates that are reasonable and prudent;
· present information, including accounting policies, in a manner that provides
relevant, reliable, comparable and understandable information;
· prepare the financial statements on a going concern basis unless it is
inappropriate to presume that the Group will continue in business;
· provide additional disclosures when compliance with the specific requirements
in IFRSs is insufficient to enable users to understand the impact of particular
transactions, other events and conditions on the entity's financial position and
financial performance; and
· state that the Group and the Company has complied with IFRSs, subject to any
material departures disclosed and explained in the financial statements.
The Directors confirm that the financial statements comply with the above
requirements.
The Directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
Group and of the Company and to enable them to ensure that the financial
statements comply with the UK's Companies Act 1985 and Article 4 of the
International Accounting Standards (IAS) Regulation. The Directors are also
responsible for safeguarding the assets of the Group and of the Company and
hence for taking reasonable steps for the prevention and detection of fraud and
other irregularities.
Statement of disclosure to auditors
The Directors who were members of the Board at the time of approving this report
are listed on page 1. Having made enquiries of fellow Directors and of the
Company's auditors, each of these Directors confirms that:
-to the best of each Director's knowledge and belief, there is no relevant audit
information of which the Company's auditors are unaware; and
-each Director has taken all the steps a Director might reasonably be expected
to have taken to make themselves aware of any relevant audit information and to
establish that the auditors are aware of that information.
Exemption from the provisions of the UK Combined Code
The Financial Services Authority in the UK has confirmed that, in view of the
primary listing of the Company being on the Bursa Malaysia Securities Berhad,
the Company is permitted to comply with the Listing Rules in respect of an
overseas company, and accordingly is not required to disclose a Statement on
Compliance with the Combined Code.
Disclosures in respect of the Malaysian Code of Corporate Governance
As required by the Listing Requirements of Bursa Malaysia Securities Berhad, the
Annual Report contains a Corporate Governance Statement pursuant to the
Malaysian Code on Corporate Governance.
STATUTORY DECLARATION
PURSUANT TO SECTION 169 (16) OF THE MALAYSIAN COMPANIES ACT,
1965
________________________________________________________________________
______________________
I, HUSSAIN AHMAD BIN ABDUL KADER, being the officer primarily responsible for
the financial management of Inch Kenneth Kajang Rubber PLC, do solemnly and
sincerely declare that the accompanying financial statements set out on pages 34
to 66 are in my opinion correct and make this solemn declaration conscientiously
believing the same to be true and by virtue of the provisions of the Statutory
Declarations Act, 1960.
Subscribed and solemnly declared by
The above named HUSSAIN AHMAD BIN ABDUL KADER
at Kuala Lumpur in the Federal Territory on
20 April 2009HUSSAIN AHMAD BIN ABDUL KADER
Before me,
Commissioner for Oaths
Kuala Lumpur
20 April 2009
INDEPENDENT AUDITORS' REPORT
TO THE SHAREHOLDERS OF INCH KENNETH KAJANG RUBBER PLC
We have audited the Group and Company financial statements of Inch Kenneth
Kajang Rubber plc for the year ended 31 December 2008, which comprise the
Group and Company Income Statements, the Group and Company Balance Sheets, the
Group and Company Statements of Changes in Equity, the Group and Company Cash
Flow Statements and the related notes. These financial statements have been
prepared in accordance with the basis and the accounting policies set out
therein. We have also audited the information in the Directors' Remuneration
section of the Corporate Governance Statement that is described as being
audited.
This report is made solely to the Company's members, as a body, in accordance
with Section 235 of the Companies Act 1985. Our audit work has been undertaken
so that we might state to the Company's members those matters we are required to
state to them in an auditors' report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone
other than the Company and the Company's members as a body, for our audit work,
for this report, or for the opinions we have formed.
Respective responsibilities of Directors and Auditors
The Directors' responsibilities for preparing the Annual Report and the Group
and Parent Company financial statements in accordance with applicable United
Kingdom law and International Financial Reporting Standards ("IFRS"), as adopted
by the European Union, and for preparing the Directors' Remuneration section of
the Corporate Governance Statement are set out in the Statement of
Responsibilities of those Charged with Governance.
Our responsibility is to audit the financial statements and the part of the
Corporate Governance statement relating to Directors' remuneration to be audited
in accordance with relevant legal and regulatory requirements and International
Standards on Auditing (UK and Ireland).
We report to you our opinion as to whether the financial statements give a true
and fair view and whether the financial statements and the part of the Corporate
Governance statement relating to Directors' remuneration to be audited are
properly prepared in accordance with the Companies Act 1985 and whether, in
addition, the Group financial statements have been properly prepared in
accordance with Article 4 of the IAS Regulation. We also report to you whether,
in our opinion, the information given in the Directors' Report in consistent
with the financial statements.
In addition, we report to you if, in our opinion, the Company has not kept
proper accounting records, if we have not received all the information and
explanations we require for our audit, or if information specified by law
regarding Directors' remuneration and other transactions with the Company is not
disclosed.
We read other information contained in the Annual Report, as described in the
contents section, and consider whether it is consistent with the audited Group
and Company financial statements. We consider the implications for our report if
we become aware of any apparent misstatements or material inconsistencies with
the financial statements. Our responsibilities do not extend to any other
information.
Basis of audit opinion
We conducted our audit in accordance with the International Standards on
Auditing (UK and Ireland) issued by the UK's Auditing Practices Board. An audit
includes examination, on a test basis, of evidence relevant to the amounts and
disclosures in the financial statements and the part of the Corporate Governance
statement relating to Directors' remuneration to be audited. It also includes
an assessment of the significant estimates and judgments made by the Directors
in the preparation of the financial statements, and of whether the accounting
policies are appropriate to the Group's and Company's circumstances,
consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
and the part of the Corporate Governance statement relating to Directors'
remuneration to be audited are free from material misstatement, whether caused
by fraud or other irregularity or error. In forming our opinion, we also
evaluated the overall adequacy of the presentation of information in the
financial statements and the part of the Corporate Governance statement relating
to Directors' remuneration to be audited.
INDEPENDENT AUDITORS' REPORT
TO THE SHAREHOLDERS OF INCH KENNETH KAJANG RUBBER PLC
Opinion
In our opinion:
·the financial statements give a true and fair view, in accordance with IFRSs as
adopted by the European Union, of the state of the Group's and Parent Company's
affairs as at 31 December 2008 and of the Group's and Parent Company's loss for
the year then ended;
·the financial statements and the part of the Corporate Governance statement
relating to Directors' remuneration to be audited have been properly prepared in
accordance with the Companies Act 1985 and, as regards the Group financial
statements, Article 4 of the IAS Regulation; and
·the information given in the Directors' Report is consistent with the financial
statements.
UHY Hacker Young LLP
Chartered Accountants
Registered Auditors
Quadrant House
17 Thomas More Street
Thomas More Square
London E1W 1YW
United Kingdom
28 April 2009
INCOME STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
________________
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | GROUP | | COMPANY |
+---------------------------------------------+-------+---------------------------+--+----------------------+
| |Notes | 2008 | 2007 | | 2008 | 2007 |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Revenue | 4 | 17,550 | 19,736 | | 4,073 | 3,154 |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Cost of sales | | (11,029) | (14,130) | | (1,526) | (1,185) |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Gross profit | | 6,521 | 5,606 | | 2,547 | 1,969 |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Other income | 5 | 459 | 343 | | 74 | 4 |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Administrative expenses | | (6,905) | (7,525) | | (2,877) | (3,912) |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Operating profit/(loss) | 6 | 75 | (1,576) | | (256) | (1,939) |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Finance income | | 3 | 16 | | 3 | 16 |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Finance costs | 7 | (1,360) | (1,356) | | (1,351) | (1,350) |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Share of results of | 17 | (177) | 3,790 | | - | - |
| associate | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| (Loss)/profit before | | (1,459) | 874 | | (1,604) | (3,273) |
| taxation | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Taxation | 8 | (81) | (177) | | - | - |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| (Loss)/profit for the | | (1,540) | 697 | | (1,604) | (3,273) |
| year | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Attributable to: | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Equity | | (1,540) | 697 | | (1,604) | (3,273) |
| holders | | | | | | |
| of the | | | | | | |
| Company | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| (Losses)/earnings per | 9 | | | | | |
| share (Sen): | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Basic | | (0.37) | 0.17 | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Diluted | | (0.37) | 0.17 | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
| Net dividend per share | | - | - | | | |
| (Sen) | | | | | | |
+---------------------------------------------+-------+-------------+-------------+--+-----------+----------+
The results for 2008 and 2007 relate entirely to continuing operations.
BALANCE SHEETS
AS AT 31 DECEMBER 2008
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | GROUP | | COMPANY |
+-----------------------------------+-------+--------------------+--+-------------------+
| |Notes | 2008 | 2007 | | 2008 | 2007 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| ASSETS | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Non-current assets | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Property, plant and equipment | 12 | 396,982 | 450,244 | | 209,834 | 262,269 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Prepaid land lease payments | 13 | 48 | 49 | | - | - |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Intangible assets | 14 | 5 | 12 | | 5 | 12 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Deposits for purchases of | 15 | 54,928 | 58,556 | | - | - |
| investments | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Investments in subsidiaries | 16 | - | - | | 181,476 | 185,056 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Investment in associate | 17 | 45,073 | 45,244 | | 47,407 | 47,400 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Available-for-sale investments | 18 | 117 | 534 | | 73 | 478 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | 497,153 | 554,639 | | 438,795 | 495,215 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Current assets | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Inventories | 19 | 39 | 19 | | 11 | 2 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Trade and other receivables | 20 | 11,806 | 12,723 | | 4,003 | 3,804 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Deposits for purchases of | 15 | 2,500 | - | | - | - |
| investments | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Short-term deposits | 21 | 805 | 805 | | 805 | 805 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Cash and cash equivalents | 21 | 1,471 | 2,966 | | 299 | 2,082 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | 16,621 | 16,513 | | 5,118 | 6,693 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| TOTAL ASSETS | | 513,774 | 571,152 | | 443,913 | 501,908 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| EQUITY AND LIABILITIES | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Equity attributable to shareholders of the | | | | |
| Company | | | | |
+------------------------------------------------------+---------+--+---------+---------+
| Share capital | 22 | 287,343 | 287,343 | | 287,343 | 287,343 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Share premium | | 8 | 8 | | 8 | 8 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Property revaluation reserve | | 196,240 | 248,660 | | 117,725 | 170,145 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Investment revaluation reserve | | 12,807 | 13,093 | | (2,907) | (2,643) |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Retained (losses)/earnings | | (10,381) | (8,841) | | 15,559 | 17,163 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Total Equity | | 486,017 | 540,263 | | 417,728 | 472,016 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Current liabilities | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Trade and other payables | 23 | 7,707 | 6,940 | | 6,215 | 6,169 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Bank borrowings | 24 | 19,955 | 23,708 | | 19,955 | 23,708 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Finance lease creditors | 25 | 56 | 56 | | - | - |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Taxation payable | | 5 | 86 | | - | - |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | 27,723 | 30,790 | | 26,170 | 29,877 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Non-current liabilities | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Deferred taxation | 8 | - | 8 | | - | - |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Employee entitlements | 26 | 15 | 15 | | 15 | 15 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Finance lease creditors | 25 | 19 | 76 | | - | - |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | 34 | 99 | | 15 | 15 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| Total liabilities | | 27,757 | 30,889 | | 26,185 | 29,892 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| | | | | | | |
+-----------------------------------+-------+----------+---------+--+---------+---------+
| TOTAL EQUITY AND LIABILITIES | | 513,774 | 571,152 | | 443,913 | 501,908 |
+-----------------------------------+-------+----------+---------+--+---------+---------+
The financial statements were approved by the Board of Directors on 20 April
2009 and signed on its behalf by:
Dato' Adnan Bin MaarufAhmad Zakie bin Haji Ahmad Shariff
DirectorDirector
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
_________________
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | Share | Share | Property | Investment |Retained | Total |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| |Capital |Premium |Revaluation |Revaluation | Losses | Equity |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | Reserve | Reserve | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Year ended 31 December | | | | | | |
| 2008 | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| At 1 January 2008 | 287,343 | 8 | 248,660 | 13,093 | (8,841) | 540,263 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Surplus/(deficits) on | | | | | | |
| revaluation of | | | | | | |
| investments: | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| - Group's | - | - | - | (286) | - | (286) |
| available-for-sale | | | | | | |
| investments (note 18) | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Deficit on revaluation | - | - | (52,420) | - | - | (52,420) |
| of properties (note 12) | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Loss for the year | - | - | - | - | (1,540) | (1,540) |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| At 31 December 2008 | 287,343 | 8 | 196,240 | 12,807 | (10,381) | 486,017 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Year ended 31 December | | | | | | |
| 2007 | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| At 1 January 2007 | 287,343 | 8 | 61,161 | - | (9,538) | 338,974 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Surplus/(deficits) on | | | | | | |
| revaluation of | | | | | | |
| investments: | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| - Group's | - | - | - | (2,621) | - | (2,621) |
| available-for-sale | | | | | | |
| investments | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| - reversal of | - | - | - | 15,714 | - | 15,714 |
| associate's goodwill | | | | | | |
| impairment | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Surplus on revaluation | - | - | 174,140 | - | - | 174,140 |
| of properties (note 12) | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Write back of deferred | - | - | 13,359 | - | - | 13,359 |
| tax liability (note 8) | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Profit for the year | - | - | - | - | 697 | 697 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| At 31 December 2007 | 287,343 | 8 | 248,660 | 13,093 | (8,841) | 540,263 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
_________________
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | Share | Share | Property | Investment |Retained | Total |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| |Capital |Premium |Revaluation |Revaluation | Losses | Equity |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | Reserve | Reserve | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Year ended 31 December | | | | | | |
| 2008 | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| At 1 January 2008 | 287,343 | 8 | 170,145 | (2,643) | 17,163 | 472,016 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Deficits on revaluation | - | - | - | (264) | - | (264) |
| of available-for-sale | | | | | | |
| investments (note 18) | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Deficit on revaluation | - | - | (52,420) | - | - | (52,420) |
| of property (note 12) | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Loss for the year | - | - | - | - | (1,604) | (1,604) |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| At 31 December 2008 | 287,343 | 8 | 117,725 | (2,907) | 15,559 | 417,728 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Year ended 31 December | | | | | | |
| 2007 | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| At 1 January 2007 | 287,343 | 8 | 61,161 | - | 20,436 | 368,948 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Deficits on revaluation | - | - | - | (2,643) | - | (2,643) |
| of available-for-sale | | | | | | |
| investments (note 18) | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Surplus on revaluation | - | - | 100,990 | - | - | 100,990 |
| of properties (note 12) | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Write back of deferred | - | - | 7,994 | - | - | 7,994 |
| tax liability (note 8) | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| Loss for the year | - | - | - | - | (3,273) | (3,273) |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| | | | | | | |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
| At 31 December 2007 | 287,343 | 8 | 170,145 | (2,643) | 17,163 | 472,016 |
+-------------------------+---------+---------+-------------+-------------+----------+----------+
CASH FLOW STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
____________
+----------------------------------+----+----------+---------+--+---------+---------+
| | | GROUP | | COMPANY |
+----------------------------------+----+--------------------+--+-------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+----------------------------------+----+----------+---------+--+---------+---------+
| Cash flows from operating | | | | | | |
| activities | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Group operating profit/(loss) | | 75 | (1,576) | | (256) | (1,939) |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Adjustments for items not | | | | | | |
| requiring an outflow of funds: | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Profit on sale of investments | | (71) | - | | (71) | - |
+----------------------------------+----+----------+---------+--+---------+---------+
| Depreciation and amortization | | 1,017 | 1,009 | | 24 | 28 |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Operating profit/(loss) before | | 1,021 | (567) | | (303) | (1,911) |
| changes in working capital | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Changes in working capital: | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Decrease/(increase) in current | | 2,030 | (3,784) | | 955 | (332) |
| assets | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Increase/(decrease) in current | | 773 | (2,207) | | (1,117) | (3,652) |
| liabilities | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Taxation paid | | (181) | (607) | | - | - |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Net cash from/(used in) | | 3,643 | (7,165) | | (465) | (5,895) |
| operating activities | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Investing activities | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Proceeds from disposal of | | 213 | - | | 213 | - |
| investments | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Purchases of available-for-sale | | (11) | (5) | | (1) | - |
| investments | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Interest and dividends received | | 3 | 16 | | 3 | 16 |
+----------------------------------+----+----------+---------+--+---------+---------+
| Loans repaid by/(granted to) | | - | - | | 3,580 | (2,473) |
| subsidiaries | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Purchases of shares in associate | | (6) | (1,380) | | (6) | (716) |
+----------------------------------+----+----------+---------+--+---------+---------+
| Payments to acquire property, plant | (167) | (570) | | (2) | (12) |
| and equipment and software | | | | | |
+---------------------------------------+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Net cash from/(used in) | | 32 | (1,939) | | 3,787 | (3,185) |
| investing activities | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Financing activities | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Interest paid | | (1,360) | (1,356) | | (1,351) | (1,350) |
+----------------------------------+----+----------+---------+--+---------+---------+
| Repayments of finance leases | | (56) | (14) | | - | - |
+----------------------------------+----+----------+---------+--+---------+---------+
| Proceeds from bank borrowings | | - | 20,208 | | - | 20,208 |
+----------------------------------+----+----------+---------+--+---------+---------+
| Repayments of bank borrowings | | (3,754) | (7,800) | | (3,754) | (7,800) |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Net cash (used | | (5,170) | 11,038 | | (5,105) | 11,058 |
| in)/from financing activities | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| (Decrease)/increase in cash and | | (1,495) | 1,934 | | (1,783) | 1,978 |
| cash equivalents | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Cash and cash equivalents at 1 | | 2,966 | 1,032 | | 2,082 | 104 |
| January | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
| Cash and cash equivalents at 31 | | 1,471 | 2,966 | | 299 | 2,082 |
| December | | | | | | |
+----------------------------------+----+----------+---------+--+---------+---------+
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
_____________________
1. Corporate information
The consolidated financial statements of Inch Kenneth Kajang Rubber plc ("the
Company") and its subsidiaries (together "the Group") for the year ended 31
December 2008 were authorized for issue by the Directors on 20 April 2009. Inch
Kenneth Kajang Rubber plc is a public limited company incorporated in Scotland.
Its shares are publicly traded on Bursa Malaysia Securities, Singapore Exchange
Securities Trading Limited and the London Stock Exchange. The principal
activities of the Group are oil palm plantation owners, tourism resort
operators, retailers of building supplies and property development. Further
information on the Company's subsidiaries is in note 16.
2. Accounting policies
The principal accounting policies applied in the preparation of these financial
statements are set out below. These policies have been consistently applied to
all the years presented, unless otherwise stated below.
2.1 Basis of preparation and going concern
The Group's financial statements are prepared on a going concern basis and in
accordance with International Financial Reporting Standards, as adopted by the
European Union ("IFRS") and in accordance with those parts of the UK's Companies
Act 1985 applicable to companies preparing their accounts in accordance with
IFRS.
The Company's financial statements have also been prepared in accordance with
IFRS and the Companies Act 1985.
The financial statements of the Group and Company are also prepared on an
historical basis as modified by the revaluation of freehold land and
available-for-sale investments.
The Group's financial statements are presented in Ringgit Malaysia and all
values are rounded to the nearest thousand (RM'000) except when otherwise
indicated. The exchange rate of Ringgit Malaysia to Pounds Sterling at 31
December 2008 was GBP1 : RM5.0118 (RM1 : GBP0.1995).
Going concern
During the year ended 31 December 2008 the group made a loss of RM1.54 million
(2007 - profit of RM697,000) and at the balance sheet date the Group had net
current liabilities of RM11.1 million (2007 - 14.2 million) and net assets of
RM486 million (2007 - RM540 million). The operations of the Group are currently
being financed by funds raised from the Group's operations and short term bank
revolving credit facilities. The Group has adequate resources to continue its
operations for the foreseeable future as there are assets available that could
easily be converted to cash or cash equivalents, should the need arise. The
revolving credit facilities are due to be renewed in June 2009. The bank has
indicated to the Company that if the revolving credit facility is not renewed in
June 2009 it could be converted to a long term loan to suit the cash
availability for repayments. The Directors are therefore satisfied that the
bankers will continue to support the Group for the foreseeable future. The
financial statements have, therefore, been prepared on the going concern basis.
2.2 New IFRS Standards and Interpretations not applied
At the date of approval of these financial statements, the following Standards
and Interpretations, which have not been applied in these financial statements,
were in issue but not yet effective:
Effective date
IFRS 2 Share based payments (Amendments)
1 January 2009
IFRS 8 Operating Segments
1 January 2009
IAS 23 (Amendment) Borrowing Costs
1 January 2009
IFRIC 13 Customer Loyalty Programmes
1 July 2008
IFRIC 15 Agreements for construction of real estate
1 January 2009
IFRIC 16 Hedges of a net investment in a foreign operation
1 October 2008
IFRIC 17 Distribution of non-cash assets to owners
1 July 2009
IFRIC 18 Transfers of assets from customers
1 July 2009
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
_____________________
2.2 New IFRS Standards and Interpretations not applied (continued)
The Directors anticipate that the adoption of these Standards and
Interpretations in future periods will have no material impact on the financial
statements of the Group except for additional disclosures on Operating Segments
when IFRS 8 comes into effect for the year commencing on 1 January 2009.
2.3 Basis of consolidation
The Group financial statements consolidate the financial statements of Inch
Kenneth Kajang Rubber plc and all its subsidiary undertakings drawn up to 31
December each year.
Subsidiaries are entities over which the Group has the power to govern the
financial and operating policies generally accompanying a shareholding of more
than one half of the voting rights. The consolidated financial statements have
been prepared by using the principles of acquisition accounting ("the purchase
method") which includes the results of the subsidiaries from their date of
acquisition.
The cost of an acquisition is measured as the fair value of the assets given,
equity instruments issued and liabilities incurred or assumed at the date of
exchange, plus costs directly attributable to the acquisition. Identifiable
assets acquired and liabilities and contingent liabilities assumed in a business
combination are measured initially at their fair values at the acquisition
date, irrespective of the extent of any minority interest. The excess of the
cost of acquisition over the fair value of the Group's share of the identifiable
net assets acquired is recorded as goodwill.
All intra-group balances, transactions, income and expenses and profits and
losses resulting from intra-group transactions are eliminated fully on
consolidation.
2.4 Investment in associated undertaking
Companies, other than subsidiary undertakings, in which the Group has an
investment and over which it exerts significant influence but does not control,
are treated as associated undertakings.
Investments in associated undertakings are equity accounted and carried in the
balance sheet at cost plus post-acquisition changes in the Group's share of net
assets of the associate, less any impairment in value.
Any goodwill arising on the acquisition of an associate, representing the excess
of the cost of the investment compared to the Group's share of the net fair
value of the associate's identifiable assets and liabilities, is included in the
carrying amount of the associate. Goodwill on the acquisition of associates is
not amortized.
The income statement includes the Group's share of the associate's profit after
tax. To the extent that losses of an associate exceed the carrying amount of the
investment, the Group discontinues including its share of further losses and the
investment is reported at nil value. Additional losses are only provided if the
Group has an obligation to a third party.
After application of the equity method, the Group determines whether it is
necessary to recognize an additional impairment loss of the Group's investment
in its associate at each balance sheet date. The Group calculates the amount of
impairment as being the difference between the fair value of the associate and
the carrying value and recognizes the amount in the income statement.
Unrealized gains on transactions between the Group and its associate are
eliminated to the extent of the Group's interest in the associate. Unrealized
losses are also eliminated unless the transaction provides evidence of an
impairment of the asset transferred. Accounting policies of the associate are
changed where necessary to ensure consistency with the accounting policies of
the Group.
The Parent Company's investment in its associate is included in the Company
balance sheet at cost, less any provision for impairment. As discussed in note
17 below, this is a change in accounting policy as the Company's investment in
its associate was previously restated to fair value annually.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
____________________
2.5 Intangible assets
Intangible assets of the Group consists of computer software and are capitalized
at their cost and are amortized on a straight-line basis over their expected
useful lives of 5 years.
The carrying value of intangible assets is tested for impairment whenever events
or changes in circumstances indicate the carrying value may not be recoverable.
2.6Property, plant and equipment
Freehold lands are stated at their fair values less impairment losses. Fair
value is based on periodic valuations made at least once in every five years and
an interim valuation every three years. Valuations are carried out by an
independent external licensed valuer on an open market value basis.Any surplus
or deficit arising on valuation is transferred directly to equity as a
revaluation surplus in the property revaluation reserve, except for those
deficits expected to be permanent, which are charged to the income statement.
Freehold lands are not depreciated.
Other property, plant and equipment are stated at cost less accumulated
depreciation and any impairment losses.
Depreciation is calculated on a straight-line basis to write off the costs, less
estimated residual values of each asset over its estimated useful lives, as
follows:
Buildings10 - 15 years
Other assets 5 - 10 years
The carrying values of property, plant and equipment are tested for impairment
if events or changes in circumstances indicate the carrying values may not be
recoverable. Any impairment losses are recognized in the income statement.
The assets' residual values and useful lives are reviewed, and adjusted if
appropriate, at each balance sheet date. Gains and losses on disposals are
determined by comparing the proceeds with the carrying amount and are recognized
within the income statement.
When revalued assets are sold, the amounts included in property
revaluation reserves are transferred to retained earnings.
2.7Financial assets
The Group classifies its financial assets in the following categories: fair
value through profit or loss, held-to-maturity, loans and receivables, and
available for sale. The classification depends on the purpose for which the
financial assets were acquired. Management determines the classification of its
financial assets at initial recognition. At 31 December 2007 and 2008 the Group
only had available-for-sale financial assets.
Available-for-sale financial assets
Available-for-sale financial assets are non-derivatives that are either
designated in this category or not classified in any of the other categories.
They are included in non-current assets unless management intends to dispose of
the investment within 12 months of the balance sheet date.
Purchases and sales of financial assets are recognized on the trade-date - the
date on which the Group commits to purchase or sell the asset. Investments are
initially recognized at fair value plus transaction costs. Available-for-sale
financial assets are subsequently carried at fair value.
Changes in the fair value of available-for-sale assets are recognized directly
in equity in the investment revaluation reserve. When securities classified as
available for sale are sold or impaired, the accumulated fair value adjustments
recognized in equity are included in the income statement. Dividends on
available-for-sale equity instruments are recognized in the income statement
when the Group's right to receive payments is established.
The fair values of quoted investments are based on current bid prices. If the
market for a financial asset is not active (and for unlisted securities), the
Group establishes fair value by using valuation techniques.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
_____________________
2.7 Financial assets (continued)
The Group assesses at each balance sheet date whether there is objective
evidence that a financial asset is impaired. A significant or prolonged decline
in the fair value of the security below its cost is considered as an indicator
that the securities are impaired. If any such evidence exists
for available-for-sale financial assets, the cumulative loss - measured as the
difference between the acquisition cost and the current fair value, less any
impairment loss on that financial asset previously recognized in profit or loss
- is removed from equity and recognized in the income statement. Impairment
losses recognized in the income statement on equity instruments are not reversed
through the income statement.
2.8 Parent Company investments in subsidiaries
The Parent Company's investments in subsidiary and associated undertakings are
included in the Company balance sheet at cost less any provisions for
impairments.
2.9Inventories
Stores and materials inventories are stated at the lower of weighted average
cost and net realizable value. Weighted average cost includes all purchase costs
and overheads. Net realizable value is the estimated selling price in the
ordinary course of business, less estimated costs of completion and sale.
No harvested fresh fruit bunches are held at year end and therefore, the
requirement under IAS 41 'Agriculture' to value agricultural produce at market
value does not apply.
2.10Cash and cash equivalents
Cash and cash equivalents are carried in the balance sheet at cost and comprise
cash in hand, cash at bank, deposits held at call with banks, other short-term
highly liquid investments with original maturities of three months or less. Bank
overdrafts are included within borrowings in current liabilities on the balance
sheet. For the purposes of the cash flow statement, cash and cash equivalents
also include any bank overdrafts.
2.11Impairment of assets
The Group assesses at each reporting date whether there is an indication that an
asset may be impaired. If any such indication exists, or when annual impairment
testing for an asset is required, the Group makes an estimate of the asset's
recoverable amount. An asset's recoverable amount is the higher of an asset's or
cash-generating unit's fair value less costs to sell and its value in use and is
determined for an individual asset, unless the asset does not generate cash
inflows that are largely independent of those from other assets or groups of
assets. Where the carrying amount of an asset exceeds its recoverable amount,
the asset is considered impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to
their present value of money and the risks specific to the asset. Impairment
losses of continuing operations are recognized in the income statement in those
expense categories consistent with the function of the impaired asset.
2.12Trade receivables
Trade receivables are carried at original invoice amount less any provision made
for impairment. A provision for impairment of receivables is established when
there is objective evidence that the Group will not be able to collect all
amounts due according to the original terms of the receivables. The amount of
the provision is the difference between the assets' carrying amount and the
recoverable amount. Provisions for impairment of receivables are included in the
income statement.
2.13 Trade payables
Trade payables are recognised initially at fair values and subsequently measured
at amortised cost using the effective interest method.
2.14Equity interests
Equity interests are classified as equity. Costs directly attributable to the
increase of new shares or options are shown in equity as a deduction from the
proceeds.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
____________________
2.15 Borrowings
Borrowings are recognized initially at fair value, net of transaction costs
incurred. Borrowings are subsequently stated at amortised cost; any difference
between the proceeds (net of transaction costs) and the redemption value is
recognized in the income statement over the period of the borrowings using the
effective interest method.
Borrowings are classified as current liabilities unless the Group has an
unconditional right to defer settlement of the liability for at least 12 months
after the balance sheet date.
2.16Revenue
Revenue is recognized to the extent that it is probable that the economic
benefits will flow to the Group and the revenue can be reliably measured.
Revenue is measured at the fair value of consideration received or receivable
net of value added tax, returns, rebates or discounts and after eliminating
sales with the Group.
Revenue derived from plantation activities represents the sale of oil palm fresh
fruit bunches and is recognized on the accruals basis.
Revenue derived from resort activities represents room rentals, net of hotel
room tax, and the sale of food and beverages. Accommodation revenue is
recognized on the arrival of customers. Payments received in advance of the
arrival of guests are included in current liabilities as accommodation rental
received in advance.
Interest and dividend income is recognized when the right to receive payments is
established.
2.17Leases
Leases where the lessor retains substantially all the
risks and benefits of ownership of the asset are classified
as operating leases. Operating lease payments are recognized as an
expense in the income statement on a
straight-line
basis over the lease term.
2.18Employee entitlements
The liability for employees' compensation for unutilized leave is accrued in
relation to services rendered by employees and relates to rights which have been
vested. These amounts are not discounted.
The Group's contribution to a defined contribution plan
is charged to the income statement in the period to which the contribution
relates.
2.19Provisions
Provisions are recognized when the Group has a legal or
constructive obligation as a result of a past event and it is probable that an
outflow of economic benefits will be required to settle the obligation. If the
effect is material, expected future cash flows are discounted using a current
pre-tax rate that reflects, where appropriate, the risks specific to the
liability.
Where the Group expects some or all of a provision to be
reimbursed, for example under an insurance policy, the reimbursement is
recognized as a separate asset but only when recovery is virtually certain. The
expense relating to any provision is presented in the income statement net of
any reimbursement. Where discounting is used, the increase in the provision due
to unwinding of discount is recognized as a finance cost.
2.20Dividend distributions
Dividend distributions proposed by the Board of
Directors and unpaid at the year end are not recognized in the financial
statements as a liability until they have been approved by the Company's
shareholders at the Annual General Meeting.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
_____________________
2.21 Biological assets
The Group's biological assets consist of oil palm tree plantations. According to
IAS 41 'Agriculture', biological assets should be valued annually at their fair
values. The gain or loss in fair value of biological assets is to be included in
the income statement.
The Group has used IAS 41's cost model to value the biological assets because
the Directors believe that fair values cannot be measured reliably as the trees
on the plantations are mature (greater than 25 years old). At 31 December 2008
the costs of the biological assets have been fully depreciated. Even though the
plantations are still producing income the Directors believe that any attempt to
revalue the plantations to their fair values would not be reliable
as market-determined prices or values are not readily available and alternative
estimates of fair value are unreliable. The biological assets (i.e. the oil palm
trees) are therefore carried in the Company's and Group's financial statements
at a nil net book value.
The freehold estate land is carried at its fair value as discussed
in note 2.6 above.
The harvested produce (fresh fruit bunches) are sold within a day or two of
being harvested. Therefore the requirement under IAS 41 to value agricultural
produce at market value as inventories does not apply.
2.22Current and deferred income tax
The current income tax charge is calculated on the basis of the tax laws enacted
or substantively enacted at the balance sheet date.
Deferred income tax is provided in full, using the liability method, on
temporary differences arising between the tax bases of assets and liabilities
and their carrying amounts in the consolidated financial statements. Deferred
income tax is determined using tax rates (and laws) that have been enacted or
substantially enacted by the balance sheet date and are expected to apply when
the related deferred income tax asset is realized or the deferred income tax
liability is settled.
Deferred income tax assets are recognized to the extent that it is probable that
future taxable profit will be available against which the temporary differences
can be utilized.
2.23Foreign currency translation
Functional and presentational currency
Items included in the financial statements of each of the Group's entities are
measured using the currency of the primary economic environment in which the
entity operates ('the functional currency'). The consolidated financial
statements are presented in 'Ringgit Malaysia' ('RM'), which is the Company's
and the Group's functional and presentation currency.
Transactions and balances
Foreign currency transactions are translated into the functional currency using
the exchange rates prevailing at the dates of the transactions. Foreign exchange
gains and losses resulting from the settlement of such transactions and from the
translation at year end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognized in the income statement.
3. Significant accounting judgements and estimates
In the process of applying the Group's accounting policies, which are described
in note 2 above, the Directors have made the following judgments and assumptions
concerning the future. The resulting accounting estimates will, by definition,
seldom equal the related actual results. The estimates and assumptions that have
a risk of causing material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below:
Impairment of available-for-sale financial assets
The Group follows the guidance of IAS 39 to determine when an available-for-sale
financial asset is impaired. This determination requires significant judgment.
In making this judgment, the Group evaluates, among other factors, the duration
and extent to which the fair value of an investment is less than its cost; and
the financial health of and near-term business outlook for the
investee, including factors such as industry and sector performance, changes in
technology and operational and financing cash flow. If all of the declines in
fair value below cost were considered significant or prolonged, the Group would
suffer an
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
_____________________
3. Significant accounting judgements and estimates (continued)
additional loss of RM2.9 million in its 2008 financial statements, being the
transfer of the accumulated fair value adjustments recognized in equity on the
impaired available-for-sale financial assets to the income statement.
Fair value of freehold lands
The Group has revalued its freehold lands based on independent external
valuations on February and March 2009, and there were a resulting deficit on the
revaluation.
Deferred tax asset
Deferred tax assets are recognized for all unused tax losses to the extent that
it is probable that taxable profit will be available against which the losses
can be utilized. Significant judgment and measurement is required to determine
the amount of deferred tax asset that can be recognized, based on the likely
timing of future taxable profit together with future tax planning strategies.
The carrying value of deferred tax assets recognized as at 31 December 2008 is
RM Nil (2007: RM Nil) and the unrecognized tax losses as at 31 December 2008 is
RM1,875,000 (2007: RM1,705,000). Further details are shown in note 8 below.
Judgments
In the process of applying the Group's accounting policies, management has made
the following significant judgments, apart from those involving estimations,
which may have a significant effect on amounts recognized in the financial
statements: impairment of assets, valuation of biological assets and of
property, plant and equipment.
4. Segmental information
A business segment is a group of assets and operations engaged in providing
products or services that are subject to risks and returns that are different
from those of other business segments. A geographical segment is engaged in
providing products or services within a particular economic environment that are
subject to risks and returns that are different from those of segments operating
in other economic environments.
The Group's operating businesses are organised and managed separately according
to the nature of products produced and services provided, with each segment
representing a strategic business unit that offers different products and serves
different markets.
At 31 December 2008, the Group was organised into five main business segments as
follows:
* Plantations - sale of fresh fruit bunches;
* Tourism - operation of a tourist resort and sale of food and beverages;
* Property development and leasing - development and sale of land and properties
and leasing of buildings;
* Trading - trading of building materials; and
* Investment - holding of equity interests in quoted shares.
There are no geographical segments as the Group operates in one geographical
location, Malaysia. Accordingly, no secondary segmental information is presented
below.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008___________________________________________________________________________
__________________
4. Segmental information (continued)
The segment results for the year ended 31 December 2008 are as follows:
+---------------------+------------+----------+-------------+---------+------------+---------+
| |Plantation | Tourism | Property |Trading |Investment | Total |
| | | |development | | | |
| | | | & | | | |
| | | | leasing | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Revenue | 4,073 | 5,725 | 184 | 7,568 | - | 17,550 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Segment operating | (256) | 439 | 160 | (268) | - | 75 |
| results | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Net finance costs | 3 | (9) | - | | (1,351) | (1,357) |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Share of | - | - | - | | (177) | (177) |
| associate's loss | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Income tax expenses | - | (70) | - | (11) | - | (81) |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Net (loss)/profit | (253) | 360 | 160 | (279) | (1,528) | (1,540) |
| for the year | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
The segment assets and liabilities at 31 December 2008 and capital expenditure
for the year then ended are as follows:
+---------------------+------------+----------+-------------+---------+------------+---------+
| |Plantation | Tourism | Property |Trading |Investment | Total |
| | | |development | | | |
| | | | & | | | |
| | | | leasing | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Assets and | | | | | | |
| liabilities: | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Segment assets | 213,794 | 7,923 | 186,877 | 3,614 | 56,493 | 468,701 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Investment in | - | - | - | - | 45,073 | 45,073 |
| associate | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Total assets | 213,794 | 7,923 | 186,877 | 3,614 | 101,566 | 513,774 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Segment liabilities | 5,067 | 814 | 653 | 39 | - | 6,573 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Unallocated | - | - | - | - | - | 21,184 |
| liabilities | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Total liabilities | | | | | | 27,757 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Other segment | | | | | | |
| information: | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Capital expenditure | 2 | 165 | - | - | - | 167 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Depreciation | 17 | 886 | 106 | - | - | 1,009 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Amortization | 7 | 1 | - | - | - | 8 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
_____________________
4. Segmental information (continued)
The segmented results for the year ended 31 December 2007 are as follows:
+---------------------+------------+----------+-------------+---------+------------+---------+
| |Plantation | Tourism | Property |Trading |Investment | Total |
| | | |development | | | |
| | | | & | | | |
| | | | leasing | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Revenue | 3,154 | 4,864 | 276 | 11,442 | - | 19,736 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Segment operating | (1,938) | 345 | (56) | 73 | - | (1,576) |
| results | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Net finance costs | 16 | (6) | - | - | (1,350) | (1,340) |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Share of | - | - | - | - | 3,790 | 3,790 |
| associate's profit | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Income tax expenses | - | (203) | 42 | (16) | - | (177) |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Net (loss)/profit | (1,922) | 136 | (14) | 57 | 2,440 | 697 |
| for the year | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
The segment assets and liabilities at 31 December 2007 and capital expenditure
for the year then ended are as follows:
+---------------------+------------+----------+-------------+---------+------------+---------+
| |Plantation | Tourism | Property |Trading |Investment | Total |
| | | |development | | | |
| | | | & | | | |
| | | | leasing | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 | RM'000 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Assets and | | | | | | |
| liabilities: | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Segment assets | 268,974 | 8,857 | 183,920 | 5,068 | 59,089 | 525,908 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Investment in | - | - | - | - | 45,244 | 45,244 |
| associate | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Total assets | 268,974 | 8.857 | 183,920 | 5,068 | 104,333 | 571,152 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Segment liabilities | 6,183 | 792 | 75 | 37 | - | 7,087 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Unallocated | - | - | - | - | - | 23,802 |
| liabilities | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Total liabilities | | | | | | 30,889 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Other segment | | | | | | |
| information: | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Capital expenditure | 5 | 711 | - | - | - | 716 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Depreciation | 20 | 984 | - | - | - | 1,004 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| Amortization | 5 | - | - | - | - | 5 |
+---------------------+------------+----------+-------------+---------+------------+---------+
| | | | | | | |
+---------------------+------------+----------+-------------+---------+------------+---------+
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
__________________________
5. Other income
+-------------------+------------+----------+------------+--+------------+-----------+
| | | Group | | Company |
+-------------------+------------+-----------------------+--+------------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+-------------------+------------+----------+------------+--+------------+-----------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+-------------------+------------+----------+------------+--+------------+-----------+
| | | | | | | |
+-------------------+------------+----------+------------+--+------------+-----------+
| Gain on disposal investment | 71 | - | | 71 | - |
+--------------------------------+----------+------------+--+------------+-----------+
| Sundry income | | 19 | 16 | | 3 | 4 |
+-------------------+------------+----------+------------+--+------------+-----------+
| Road toll income | | 96 | 151 | | - | - |
+-------------------+------------+----------+------------+--+------------+-----------+
| Rental income | | 273 | 176 | | - | - |
+-------------------+------------+----------+------------+--+------------+-----------+
| | | | | | | |
+-------------------+------------+----------+------------+--+------------+-----------+
| | | 459 | 343 | | 74 | 4 |
+-------------------+------------+----------+------------+--+------------+-----------+
| | | | | | | |
+-------------------+------------+----------+------------+--+------------+-----------+
6.Operating profit/(loss)
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| | | Group | | Company |
+-----------------------------+--+-----------------------+--+-----------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| | | | | | | |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| The operating loss is | | | | | | |
| stated after charging: | | | | | | |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| | | | | | | |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| Auditors' remuneration: | | 150 | 198 | | 150 | 198 |
| - Parent Company | | 121 | 53 | | - | - |
| auditor | | | | | | |
| - Subsidiaries' auditor | | | | | | |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| Depreciation | | 1,009 | 1,004 | | 17 | 23 |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| Amortization of intangible | | 8 | 5 | | 7 | 5 |
| assets | | | | | | |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| Rental expense | | 895 | 408 | | 184 | 276 |
| - land and buildings | | | | | | |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| Staff costs (note 10) | | 2,157 | 2,489 | | 1,153 | 1,614 |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
| Provision for doubtful | | 167 | 108 | | | - |
| debts | | | | | | |
+-----------------------------+--+-----------+-----------+--+-----------+-----------+
No fees were payable to the Company's auditors for non-audit services in
2008 and 2007.
7.Finance costs
+----------------------------+---+-----------+-----------+---+-----------+-----------+
| | | Group | | Company |
+----------------------------+---+-----------------------+---+-----------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+----------------------------+---+-----------+-----------+---+-----------+-----------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+----------------------------+---+-----------+-----------+---+-----------+-----------+
| | | | | | | |
+----------------------------+---+-----------+-----------+---+-----------+-----------+
| Bank loan interest | | 1,351 | 1,350 | | 1,351 | 1,350 |
+----------------------------+---+-----------+-----------+---+-----------+-----------+
| Finance lease charges | | 9 | 6 | | - | - |
+----------------------------+---+-----------+-----------+---+-----------+-----------+
| | | | | | | |
+----------------------------+---+-----------+-----------+---+-----------+-----------+
| | | 1,360 | 1,356 | | 1,351 | 1,350 |
+----------------------------+---+-----------+-----------+---+-----------+-----------+
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
__________________
8. Taxation
The tax charge is made up as follows:
+---------------------------+----+-----------+-----------+---+-----------+-----------+
| | | Group | | Company |
+---------------------------+----+-----------------------+---+-----------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+---------------------------+----+-----------+-----------+---+-----------+-----------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+---------------------------+----+-----------+-----------+---+-----------+-----------+
| In Malaysia | | | | | | |
+---------------------------+----+-----------+-----------+---+-----------+-----------+
| - Current | | 120 | 209 | | - | - |
| taxation | | | | | | |
+---------------------------+----+-----------+-----------+---+-----------+-----------+
| - Over | | (31) | (32) | | - | - |
| provision in | | | | | | |
| respect of | | | | | | |
| prior years | | | | | | |
+---------------------------+----+-----------+-----------+---+-----------+-----------+
| Deferred taxation - | | (8) | - | | - | - |
| credit | | | | | | |
+---------------------------+----+-----------+-----------+---+-----------+-----------+
| | | | | | | |
+---------------------------+----+-----------+-----------+---+-----------+-----------+
| | | 81 | 177 | | - | - |
+---------------------------+----+-----------+-----------+---+-----------+-----------+
The Group is not subject to taxation in the United Kingdom.
The Group's effective tax rate differs from the standard rate of
corporation tax in Malaysia of 26% (2007: 27%) as follows:
+-----------------------------+--+---+----------+---+-----------+--+---+----------+----+----+---+
| | | Group | | Company |
+-----------------------------+--+------------------------------+--+----------------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| | | RM'000 | RM'000 | | RM'000 |RM'000 |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| | | | | | | |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| (Loss)/profit before | | (1,459) | 874 | | (1,604) | (3,273) |
| taxation | | | | | | |
+-----------------------------+------+----------+---------------+------+----------+---------+
| | | | | | | |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| Tax at the rate in Malaysia | | (379) | 236 | | (417) | (884) |
| of 26% (2007: 27%) | | | | | | |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| Effect on differential tax | | 15 | (1,406) | | - | - |
| rate of 20% | | | | | | |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| | | | | | | |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| Tax effects of: | | | | | | |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| Expense not deductible for | | 269 | 1,054 | | 210 | 700 |
| tax purposes | | | | | | |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| Income not subject to tax | | (2) | (1) | | (2) | (1) |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| Deferred tax assets not | | 209 | 326 | | 209 | 185 |
| recognized | | | | | | |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| Over provision in respect | | (31) | (32) | | - | - |
| of prior years | | | | | | |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| | | | | | | |
+-----------------------------+--+------------------+-----------+--+-------------------+--------+
| Total tax charge for year | | 81 | 177 | | - | - |
+-----------------------------+--+---+----------+---+-----------+--+---+----------+----+----+---+
Deferred taxation
The deferred tax included in the balance sheet is as follows:
+----------------------------+--+------------+-----------+--+-----------+-----------+
| | | Group | | Company |
+----------------------------+--+------------------------+--+-----------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| | | | | | | |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| Other temporary | | - | 8 | | - | - |
| differences | | | | | | |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| Surplus on revaluation of | | - | - | | - | - |
| freehold land | | | | | | |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| | | | | | | |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| | | - | 8 | | - | - |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| | | | | | | |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| At 1 January | | - | 13,367 | | - | 7,994 |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| Recognized in income | | - | - | | - | - |
| statement | | | | | | |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| Write back to equity (see | | - | (13,359) | | - | (7,994) |
| below) | | | | | | |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| | | | | | | |
+----------------------------+--+------------+-----------+--+-----------+-----------+
| At 31 December | | - | 8 | | - | - |
+----------------------------+--+------------+-----------+--+-----------+-----------+
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
_____________
8.Taxation (continued)
In 2007 the Malaysian Government exempted capital gains on the sale of
properties from taxation. The Group's RM13.359 million (Company - RM7.994
million) of the deferred tax liability brought forward from previous years that
arose on the revaluation of the Group's land was therefore been written back in
2007 to the property revaluation reserve.
The estimated deferred tax benefits not provided in these financial statements
are as follows:
+----------------------+--+-----------+-----------+--+-----------+----------+
| | | Group | | Company |
+----------------------+--+-----------------------+--+----------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+----------------------+--+-----------+-----------+--+-----------+----------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+----------------------+--+-----------+-----------+--+-----------+----------+
| | | | | | | |
+----------------------+--+-----------+-----------+--+-----------+----------+
| Arising from: | | | | | | |
+----------------------+--+-----------+-----------+--+-----------+----------+
| Unrecognized tax | | 1,772 | 1,608 | | 1,770 | 1,605 |
| losses | | | | | | |
+----------------------+--+-----------+-----------+--+-----------+----------+
| Utilized capital | | 103 | 97 | | 103 | 97 |
| allowances | | | | | | |
+----------------------+--+-----------+-----------+--+-----------+----------+
| | | | | | | |
+----------------------+--+-----------+-----------+--+-----------+----------+
| | | 1,875 | 1,705 | | 1,873 | 1,702 |
+----------------------+--+-----------+-----------+--+-----------+----------+
The key factors that may affect future tax charges include the ability to claim
capital allowances in excess of depreciation, utilization of unrelieved tax
losses and changes in tax legislation. The Group expects to be able to claim
capital allowances in excess of depreciation in future years based on its
capital investment plans. The Group also has unused tax losses. The availability
of the unused tax losses for offsetting against future taxable profits of the
Company and its subsidiaries are subject to no substantial changes in
shareholdings of the Company and its subsidiaries under Section 44 (5A) & (5B)
of Income Tax Act, 1967.
9.(Losses)/earnings per share
The calculation of earnings per share is based on the Group's loss for the year
of RM1,540,000 (2007: profit of RM697,000) and the weighted average number of
shares in issue during the year of 420,750,000 (2007: 420,750,000). There are no
potential dilutive shares or share options outstanding and therefore, the
diluted earnings per share is the same as basic earnings per share.
10. Employee information
+----------------------+--+-----------+-----------+--+-----------+-----------+
| | | Group | | Company |
+----------------------+--+-----------------------+--+-----------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+----------------------+--+-----------+-----------+--+-----------+-----------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+----------------------+--+-----------+-----------+--+-----------+-----------+
| | | | | | | |
+----------------------+--+-----------+-----------+--+-----------+-----------+
| Staff costs | | | | | | |
| comprises: | | | | | | |
+----------------------+--+-----------+-----------+--+-----------+-----------+
| | | | | | | |
+----------------------+--+-----------+-----------+--+-----------+-----------+
| Wages and salaries | | 2,030 | 2,361 | | 1,092 | 1,541 |
+----------------------+--+-----------+-----------+--+-----------+-----------+
| Contribution to a | | 127 | 128 | | 61 | 73 |
| statutory employees' | | | | | | |
| provident fund | | | | | | |
+----------------------+--+-----------+-----------+--+-----------+-----------+
| | | | | | | |
+----------------------+--+-----------+-----------+--+-----------+-----------+
| | | 2,157 | 2,489 | | 1,153 | 1,614 |
+----------------------+--+-----------+-----------+--+-----------+-----------+
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2008
_______________________________________________________________________________
__________
10. Employee information (continued)
The average monthly number of employees employed by the Group during the year
was as follows:
+---------------------+--+-----------+-----------+--+-----------+-----------+
| | | Group | | Company |
+---------------------+--+-----------------------+--+-----------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| | | Number | Number | | Number | Number |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| | | | | | | |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| Plantation | | 58 | 43 | | 18 | 43 |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| Tourism | | 51 | 86 | | - | - |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| Property | | 2 | 2 | | - | - |
| development and | | | | | | |
| leasing | | | | | | |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| Investment | | 2 | 2 | | 2 | 2 |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| | | | | | | - |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| | | 113 | 133 | | 20 | 45 |
+---------------------+--+-----------+-----------+--+-----------+-----------+
The statutory employees' provident fund is a defined
contribution scheme funded by a government body
in Malaysia
11. Directors' emoluments
+---------------------+--+-----------+-----------+--+-----------+-----------+
| | | Group | | Company |
+---------------------+--+-----------------------+--+-----------------------+
| | | 2008 | 2007 | | 2008 | 2007 |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| | | RM'000 | RM'000 | | RM'000 | RM'000 |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| | | | | | | |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| Directors' | | 74 | 69 | | 74 | 69 |
| fees & | | | | | | |
| allowances | | | | | | |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| | | | | | | |
+---------------------+--+-----------+-----------+--+-----------+-----------+
| Highest paid | | 15 | 15 | | 15 | 15 |
| Director | | | | | | |
+---------------------+--+-----------+-----------+--+-----------+-----------+
The above emoluments are made up as follows:
+----------------------+---------+----------+------------+---------+--------+
| | Basic |Benefits | Meeting | Total | Total |
| | Salary | & |Allowances | 2008 | 2007 |
| | & Fees | Bonuses | (RM) | (RM) | (RM) |
| | (RM) | (RM) | | | |
| | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Executive Director | 12,000 | - | 3,000 | 15,000 | 14,500 |
| Dato' Adnan bin | | | | | |
| Maaruf | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Non-Executive | | | | | |
| Directors | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Ahmad Zakie bin | 8,000 | - | 4,250 | 12,250 | 10,750 |
| Ahmad Shariff | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Dato' Haji Muda bin | 8,000 | - | 4,250 | 12,250 | 11,750 |
| Mohamed | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Abdul Khudus bin | 8,000 | - | 4,250 | 12,250 | 11,750 |
| Mohd. Naaim | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Dr. Radzuan bin A. | 8,000 | - | 3,000 | 11,000 | 10,500 |
| Rahman | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Alan Maitland Dewar | 8,000 | - | 1,000 | 9,000 | 8,000 |
| McWilliam | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| Tengku Mohamed Fauzi | - | - | 2,000 | 2,000 | 2,000 |
| bin Tengku Abdul | | | | | |
| Hamid | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| | | | | | |
+----------------------+---------+----------+------------+---------+--------+
| | 52,000 | - | 21,750 | 73,750 | 69,250 |
+----------------------+---------+----------+------------+---------+--------+
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
__________________
12.Property, plant and equipment
+------------------------+-------------+-----------+----------+------------+
| Group | Freehold |Buildings | Others | Total |
| | lands | | | |
+------------------------+-------------+-----------+----------+------------+
| | RM'000 | RM'000 | RM'000 | RM'000 |
+------------------------+-------------+-----------+----------+------------+
| | | | | |
+------------------------+-------------+-----------+----------+------------+
| Cost or | | | | |
| valuation | | | | |
+------------------------+-------------+-----------+----------+------------+
| At 1 January 2007 | 269,110 | 14,167 | 5,253 | 288,530 |
+------------------------+-------------+-----------+----------+------------+
| Additions in 2007 | - | 285 | 426 | 711 |
+------------------------+-------------+-----------+----------+------------+
| Revaluations in 2007 | 174,140 | - | - | 174,140 |
+------------------------+-------------+-----------+----------+------------+
| | | | | |
+------------------------+-------------+-----------+----------+------------+
| At 1 January 2008 | 443,250 | 14,452 | 5,679 | 463,381 |
+------------------------+-------------+-----------+----------+------------+
| Additions in 2008 | - | 12 | 155 | 167 |
+------------------------+-------------+-----------+----------+------------+
| Revaluations in 2008 | (52,420) | - | - | (52,420) |
+------------------------+-------------+-----------+----------+------------+
| | | | | |
+------------------------+-------------+-----------+----------+------------+
| | | | | |
+------------------------+-------------+-----------+----------+------------+
| At 31 December 2008 | 390,830 | 14,464 | 5,834 | 411,128 |
+------------------------+-------------+-----------+----------+------------+
| | | | | |
+------------------------+-------------+-----------+----------+------------+
| Accumulated depreciation | | | |
+--------------------------------------+-----------+----------+------------+
| At 1 January 2007 | - | 7,626 | 4,507 | 12,133 |
+------------------------+-------------+-----------+----------+------------+
| Depreciation for 2007 | - | 691 | 313 | 1,004 |
+------------------------+-------------+-----------+----------+------------+
| Transfer to prepaid | - | - | - | - |
| land lease | | | | |
+------------------------+-------------+-----------+----------+------------+
| | | | | |
+------------------------+-------------+-----------+----------+------------+
| At 1 January 2008 | - | 8,317 | 4,820 | 13,137 |
+------------------------+-------------+-----------+----------+------------+
| Depreciation for 2008 | - | 702 | 307 | 1,009 |
+------------------------+-------------+-----------+----------+------------+
| | | | | |
+------------------------+-------------+-----------+----------+------------+
| At 31 December 2008 | - | 9,019 | 5,127 | 14,146 |
+------------------------+-------------+-----------+----------+------------+
| | | | | |
+------------------------+-------------+-----------+----------+------------+
| Net book values | 390,830 | 5,445 | 707 | 396,982 |
| At 31 December 2008 | | | | |
+------------------------+-------------+-----------+----------+------------+
| | | | | |
+------------------------+-------------+-----------+----------+------------+
| At 31 December 2007 | 443,250 | 6,135 | 859 | 450,244 |
+------------------------+-------------+-----------+----------+------------+
| | | | | |
+------------------------+-------------+-----------+----------+------------+
The Group's freehold lands were valued in February and March 2009 by JB
Jurunilai Bersekutu, International Asset Consultants, independent valuers, using
the open market basis method. The total valuation of the lands is RM390.830
million, a reduction of RM52.42 million from 2007.
The Group's lands are currently being used for the Group's plantation activities
for growing and the sales of oil palm fresh fruit bunches. The Group has been
given consent for the change of use of the lands. Further commentary on the
Group's plans for its land is included in the Chairman's Statement.
There is no indication of any significant difference between the book and market
values of land and buildings shown above at 31 December 2008.
There are no restrictions on the title of the Group's property, plant and
equipment.
Included in the property, plant and equipment are resort tools and equipment
amounting to RM134,331 which were financed under financial leases and freehold
land which is secured against the bank borrowings.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
____________________
12.Property, plant and equipment (continued)
+-----------------------+------------+------------+----------+----------+
| Company | Freehold | Buildings | Others | Total |
| | lands | | | |
+-----------------------+------------+------------+----------+----------+
| | RM'000 | RM'000 | RM'000 | RM'000 |
+-----------------------+------------+------------+----------+----------+
| | | | | |
+-----------------------+------------+------------+----------+----------+
| Cost or valuation | | | | |
+-----------------------+------------+------------+----------+----------+
| At 1 January 2007 | 161,110 | 477 | 837 | 162,424 |
+-----------------------+------------+------------+----------+----------+
| Additions in 2007 | - | - | 7 | 7 |
+-----------------------+------------+------------+----------+----------+
| Revaluations in 2007 | 100,990 | - | - | 100,990 |
+-----------------------+------------+------------+----------+----------+
| | | | | |
+-----------------------+------------+------------+----------+----------+
| At 1 January 2008 | 262,100 | 477 | 844 | 263,421 |
+-----------------------+------------+------------+----------+----------+
| Additions in 2008 | - | - | 2 | 2 |
+-----------------------+------------+------------+----------+----------+
| Revaluations in 2008 | (52,420) | - | - | (52,420) |
+-----------------------+------------+------------+----------+----------+
| | | | | |
+-----------------------+------------+------------+----------+----------+
| | | | | |
+-----------------------+------------+------------+----------+----------+
| At 31 December 2008 | 209,680 | 477 | 846 | 211,003 |
+-----------------------+------------+------------+----------+----------+
| | | | | |
+-----------------------+------------+------------+----------+----------+
| Accumulated | | | | |
| depreciation | | | | |
+-----------------------+------------+------------+----------+----------+
| At 1 January 2007 | - | 329 | 800 | 1,129 |
+-----------------------+------------+------------+----------+----------+
| Depreciation for 2007 | - | 10 | 13 | 23 |
+-----------------------+------------+------------+----------+----------+
| | | | | |
+-----------------------+------------+------------+----------+----------+
| At 1 January 2008 | - | 339 | 813 | 1,152 |
+-----------------------+------------+------------+----------+----------+
| Depreciation for 2008 | - | 10 | 7 | 17 |
+-----------------------+------------+------------+----------+----------+
| | | | | |
+-----------------------+------------+------------+----------+----------+
| At 31 December 2008 | - | 349 | 820 | 1,169 |
+-----------------------+------------+------------+----------+----------+
| | | | | |
+-----------------------+------------+------------+----------+----------+
| Net book values | | | | |
+-----------------------+------------+------------+----------+----------+
| At 31 December 2008 | 209,680 | 128 | 26 | 209,834 |
+-----------------------+------------+------------+----------+----------+
| | | | | |
+-----------------------+------------+------------+----------+----------+
| At 31 December 2007 | 262,100 | 138 | 31 | 262,269 |
+-----------------------+------------+------------+----------+----------+
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
___________________
13.Prepaid land lease payments
+---------------------------------------------+---------+--+----------+
| Group | 2008 | | 2007 |
+---------------------------------------------+---------+--+----------+
| | RM'000 | | RM'000 |
+---------------------------------------------+---------+--+----------+
| | | | |
+---------------------------------------------+---------+--+----------+
| At 1 January | 49 | | 50 |
+---------------------------------------------+---------+--+----------+
| Amortization for the year | (1) | | (1) |
+---------------------------------------------+---------+--+----------+
| | | | |
+---------------------------------------------+---------+--+----------+
| At 31 December - non-current asset | 48 | | 49 |
+---------------------------------------------+---------+--+----------+
14.Intangible assets
+---------------------------------------------+----------+--+---------+
| | Computer software |
+---------------------------------------------+-----------------------+
| Group and Company | 2008 | | 2007 |
+---------------------------------------------+----------+--+---------+
| | RM'000 | | RM'000 |
+---------------------------------------------+----------+--+---------+
| Cost | | | |
+---------------------------------------------+----------+--+---------+
| At 1 January | 32 | | 27 |
+---------------------------------------------+----------+--+---------+
| Additions | - | | 5 |
+---------------------------------------------+----------+--+---------+
| | | | |
+---------------------------------------------+----------+--+---------+
| At 31 December | 32 | | 32 |
+---------------------------------------------+----------+--+---------+
| | | | |
+---------------------------------------------+----------+--+---------+
| Accumulated amortization | | | |
+---------------------------------------------+----------+--+---------+
| At 1 January | 20 | | 15 |
+---------------------------------------------+----------+--+---------+
| Amortization for the year | 7 | | 5 |
+---------------------------------------------+----------+--+---------+
| | | | |
+---------------------------------------------+----------+--+---------+
| At 31 December | 27 | | 20 |
+---------------------------------------------+----------+--+---------+
| | | | |
+---------------------------------------------+----------+--+---------+
| Net book value | | | |
+---------------------------------------------+----------+--+---------+
| At 31 December | 5 | | 12 |
+---------------------------------------------+----------+--+---------+
15.Deposits for purchases of investments
The deposits for purchases of investments of RM57.428 million (2007: RM58.556
million), represent amounts paid to vendors for deposits for the purchase of
shares of three companies.The Group has options to complete the acquisitions of
those companies. The decision on whether to complete the acquisitions will
depend on the outcome of due diligence investigations on the companies to be
acquired which are expected to be completed in the foreseeable future. These
deposits are refundable in full if the Group does not proceed with these
acquisitions. During 2008 the Directors decided not to proceed with two of the
acquisitions. The deposits for those two purchases, amounting to RM2.5 million
have been reclassified to current assets with the remaining RM54.928 million
shown in non-current assets.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
___________________
16.Investment in subsidiaries
+--------------------------------------------------+------------+--+----------+
| | Company |
+--------------------------------------------------+--------------------------+
| | 2008 | | 2007 |
+--------------------------------------------------+------------+--+----------+
| | RM'000 | | RM'000 |
+--------------------------------------------------+------------+--+----------+
| | | | |
+--------------------------------------------------+------------+--+----------+
| Cost | | | |
+--------------------------------------------------+------------+--+----------+
| Shares in subsidiary undertakings | 1,000 | | 1,000 |
+--------------------------------------------------+------------+--+----------+
| Loans to subsidiary undertakings | 180,476 | | 184,056 |
+--------------------------------------------------+------------+--+----------+
| | | | |
+--------------------------------------------------+------------+--+----------+
| | 181,476 | | 185,056 |
+--------------------------------------------------+------------+--+----------+
The loans to subsidiary undertakings have no fixed repayment terms but are
repayable in more than one year.
The subsidiaries of the Group are as follows:
+---------------------+---------------+-------------+-----------+--------+--------+
| Name of company | Country of | Nature of | Type of | Percentage of |
| |incorporation | business | holding | share capital |
| | | | | held |
+---------------------+---------------+-------------+-----------+-----------------+
| | | | | 2008 | 2007 |
+---------------------+---------------+-------------+-----------+--------+--------+
| | | | | % | % |
+---------------------+---------------+-------------+-----------+--------+--------+
| | | | | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| Common Focus (M) | Malaysia | Investment | Ordinary | 100 | 100 |
| Sdn. Bhd. | | holding | shares | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| | | | | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| Perhentian Island | Malaysia | Operation | Ordinary | 100 | 100 |
| Resort Sdn. Bhd.# | | of tourist | shares | | |
| | | resort | | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| | | | | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| Prominent Mirage | Malaysia | Property | Ordinary | 100 | 100 |
| (M) Sdn. Bhd | |development | shares | | |
| | |and leasing | | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| | | | | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| Urus Kemas Sdn. | Malaysia | Trading of | Ordinary | 100 | 100 |
| Bhd.# | | building | shares | | |
| | | materials | | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| | | | | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| Meridian | Malaysia | Dormant | Ordinary | 100 | 100 |
| Communications (M) | | | shares | | |
| Sdn. Bhd. | | | | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| | | | | | |
+---------------------+---------------+-------------+-----------+--------+--------+
| Melati Atur (M) | Malaysia | Dormant | Ordinary | 100 | 100 |
| Sdn. Bhd.# | | | shares | | |
+---------------------+---------------+-------------+-----------+--------+--------+
# these subsidiaries are held indirectly by the Company.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
___________________
17. Investments in associated undertaking
Group
The Group's investment in its associated undertaking represents a 24.65%
interest in Concrete Engineering Products Berhad ("Cepco"), a public company
incorporated in Malaysia. The principal activity of Cepco is the manufacture and
distribution of prestressed spun concrete piles and poles. The Group's
investment in Cepco is accounted for under the equity accounting method as
follows:
+----------------------------------------------------------+------------+
| | 2008 |
+----------------------------------------------------------+------------+
| | RM'000 |
+----------------------------------------------------------+------------+
| Shares | |
+----------------------------------------------------------+------------+
| At 1 January 2008 | 48,120 |
+----------------------------------------------------------+------------+
| Purchase of shares in Cepco in 2008 | 6 |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| At 31 December 2008 | 48,126 |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| Share of retained profits/(losses) | |
+----------------------------------------------------------+------------+
| At 1 January 2008 | 451 |
+----------------------------------------------------------+------------+
| Share of loss for 2008 | (177) |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| At 31 December 2008 | 274 |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| Impairment of goodwill | |
+----------------------------------------------------------+------------+
| At 1 January 2008 | (3,327) |
+----------------------------------------------------------+------------+
| Impairment in year | - |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| At 31 December 2008 | (3,327) |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| Net book value | |
+----------------------------------------------------------+------------+
| At 31 December 2008 | 45,073 |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| At 31 December 2007 | 45,244 |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
___________________
17. Investments in associated undertaking (continued)
Group (continued)
The Group's share of the net assets of Cepco as at 31 December 2008
comprised:
+----------------------------------------------------------+------------+
| | 2008 |
+----------------------------------------------------------+------------+
| | RM'000 |
+----------------------------------------------------------+------------+
| Share of assets | |
+----------------------------------------------------------+------------+
| Share of non-current assets | 13,021 |
+----------------------------------------------------------+------------+
| Share of current assets | 24,558 |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| | 37,579 |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| Share of liabilities | |
+----------------------------------------------------------+------------+
| Share of non-current liabilities | (3,233) |
+----------------------------------------------------------+------------+
| Share of current liabilities | (21,017) |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| | (24,250) |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| Share of net assets | 13,329 |
+----------------------------------------------------------+------------+
| Goodwill (net of impairment) arising on the acquisition | 31,744 |
| of Cepco | |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| Carrying value of associate | 45,073 |
+----------------------------------------------------------+------------+
The Group's share of the results of Cepco for the year ended 31 December
2008 was as follows:
+----------------------------------------------------------+------------+
| | 2008 |
+----------------------------------------------------------+------------+
| | RM'000 |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| Share of revenue | 58,092 |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| Share of operating profits | 2,991 |
+----------------------------------------------------------+------------+
| Share of finance costs | (797) |
+----------------------------------------------------------+------------+
| Share of taxation | (2,371) |
+----------------------------------------------------------+------------+
| | |
+----------------------------------------------------------+------------+
| Share of profits for the year - included in Group income | (177) |
| statement | |
+----------------------------------------------------------+------------+
Cepco's shares are quoted on the Bursa Malaysia and the market value of the
Group's investment in Cepco at 31 December 2008 was RM26.047 million.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
__________________
17. Investments in associated undertaking (continued)
Company
The movement in the Company's investment in its associated
undertaking is as follows:
+-----------------------------------------------------------+-----------+
| | 2008 |
+-----------------------------------------------------------+-----------+
| | RM'000 |
+-----------------------------------------------------------+-----------+
| | |
+-----------------------------------------------------------+-----------+
| Carrying value at 1 January 2008 | 47,400 |
+-----------------------------------------------------------+-----------+
| Additions in 2008 - purchase of shares | 7 |
+-----------------------------------------------------------+-----------+
| | |
+-----------------------------------------------------------+-----------+
| Carrying value at 31 December 2008 - historical cost | 47,407 |
+-----------------------------------------------------------+-----------+
18.Available-for-sale investments
+---------------------------+------------+----------+-----------+-----------+
| | Group | Company |
+---------------------------+-----------------------+-----------------------+
| | 2008 | 2007 | 2008 | 2007 |
| | RM'000 | RM'000 | RM'000 | RM'000 |
+---------------------------+------------+----------+-----------+-----------+
| | | | | |
+---------------------------+------------+----------+-----------+-----------+
| Quoted shares: | | | | |
+---------------------------+------------+----------+-----------+-----------+
| At 1 January 2008 | 534 | 3,188 | 478 | 3,121 |
+---------------------------+------------+----------+-----------+-----------+
| Purchase of investments | 11 | 5 | 1 | - |
+---------------------------+------------+----------+-----------+-----------+
| Disposal of investments | (142) | (38) | (142) | - |
+---------------------------+------------+----------+-----------+-----------+
| Fair value adjustments | (286) | (2,621) | (264) | (2,643) |
+---------------------------+------------+----------+-----------+-----------+
| | | | | |
+---------------------------+------------+----------+-----------+-----------+
| At 31 December 2008 | 117 | 534 | 73 | 478 |
+---------------------------+------------+----------+-----------+-----------+
The above available-for-sale investments are stated at their fair values. The
historical cost of the above investments of the Group is RM46.331 million and of
the Company is RM46.264 million.
19. Inventories
+---------------------------+------------+----------+----------+------------+
| | Group | Company |
+---------------------------+-----------------------+-----------------------+
| | 2007 | 2007 | 2007 | 2007 |
+---------------------------+------------+----------+----------+------------+
| | RM'000 | RM'000 | RM'000 | RM'000 |
+---------------------------+------------+----------+----------+------------+
| | | | | |
+---------------------------+------------+----------+----------+------------+
| Estate stores | 10 | 3 | 11 | 2 |
+---------------------------+------------+----------+----------+------------+
| Resort stores | 29 | 16 | - | - |
+---------------------------+------------+----------+----------+------------+
| | | | | |
+---------------------------+------------+----------+----------+------------+
| | 39 | 19 | 11 | 2 |
+---------------------------+------------+----------+----------+------------+
No harvested fresh fruit bunches are shown as inventory at the year end because
they are all sold within a day or two of being harvested.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
__________________
20. Trade and other receivables
+-----------------------------+------------+-----------+----------+----------+
| | Group | Company |
+-----------------------------+------------------------+---------------------+
| | 2008 | 2007 | 2008 | 2007 |
| | RM'000 | RM'000 | RM'000 | RM'000 |
+-----------------------------+------------+-----------+----------+----------+
| | | | | |
+-----------------------------+------------+-----------+----------+----------+
| Trade receivables | 7,791 | 8,730 | 790 | 657 |
+-----------------------------+------------+-----------+----------+----------+
| Provision for impairment | (110) | (400) | - | - |
+-----------------------------+------------+-----------+----------+----------+
| | | | | |
+-----------------------------+------------+-----------+----------+----------+
| | 7,681 | 8,330 | 790 | 657 |
+-----------------------------+------------+-----------+----------+----------+
| | | | | |
+-----------------------------+------------+-----------+----------+----------+
| Other receivables and | 3,429 | 3,697 | 2,517 | 2,451 |
| prepayments | | | | |
+-----------------------------+------------+-----------+----------+----------+
| Corporation tax recoverable | 696 | 696 | 696 | 696 |
+-----------------------------+------------+-----------+----------+----------+
| | | | | |
+-----------------------------+------------+-----------+----------+----------+
| | 11,806 | 12,723 | 4,003 | 3,804 |
+-----------------------------+------------+-----------+----------+----------+
At 31 December 2008 the trade and other receivables outside their payment terms
yet not provided for are as follows:
+-----------------------------+------------+-----------+-----------+----------+
| Within credit terms | 1,543 | 6,700 | 796 | 719 |
+-----------------------------+------------+-----------+-----------+----------+
| Outside credit terms but | | | | |
| not impaired: | | | | |
+-----------------------------+------------+-----------+-----------+----------+
| 0-1 month | - | - | - | - |
+-----------------------------+------------+-----------+-----------+----------+
| 1-2 months | - | - | - | - |
+-----------------------------+------------+-----------+-----------+----------+
| More than 2 months | 9,567 | 5,327 | 2,511 | 2,389 |
+-----------------------------+------------+-----------+-----------+----------+
| | | | | |
+-----------------------------+------------+-----------+-----------+----------+
| | 11,110 | 12,027 | 3,307 | 3,108 |
+-----------------------------+------------+-----------+-----------+----------+
21.Cash and cash equivalents
+-----------------------------+------------+-----------+-----------+----------+
| | Group | Company |
+-----------------------------+------------------------+----------------------+
| | 2008 | 2007 | 2008 | 2007 |
+-----------------------------+------------+-----------+-----------+----------+
| | RM'000 | RM'000 | RM'000 | RM'000 |
+-----------------------------+------------+-----------+-----------+----------+
| | | | | |
+-----------------------------+------------+-----------+-----------+----------+
| Cash at bank | 1,464 | 2,964 | 299 | 2,082 |
+-----------------------------+------------+-----------+-----------+----------+
| Short term deposits | 805 | 805 | 805 | 805 |
+-----------------------------+------------+-----------+-----------+----------+
| Cash in hand | 7 | 2 | - | - |
+-----------------------------+------------+-----------+-----------+----------+
| | | | | |
+-----------------------------+------------+-----------+-----------+----------+
| | 2,276 | 3,771 | 1,104 | 2,887 |
+-----------------------------+------------+-----------+-----------+----------+
Cash and cash and cash equivalents includes RM805,000 held by Kuwait Finance
House (Malaysia) Bhd as security for the Group's bank borrowings.
22. Share capital
+--------------------------------------------------+----------+--+-----------+
| Group and Company | |
+--------------------------------------------------+-------------------------+
| | 2008 | | 2007 |
+--------------------------------------------------+----------+--+-----------+
| | GBP'000 | | GBP'000 |
+--------------------------------------------------+----------+--+-----------+
| Authorized | | | |
+--------------------------------------------------+----------+--+-----------+
| 1,000,000,000 ordinary shares of 10p each | 100,000 | | 100,000 |
+--------------------------------------------------+----------+--+-----------+
+-----------------------------+------------+-----------+-----------+----------+
| | 2008 | 2007 | 2008 | 2007 |
+-----------------------------+------------+-----------+-----------+----------+
| | RM'000 | RM'000 | GBP'000 | GBP'000 |
+-----------------------------+------------+-----------+-----------+----------+
| | | | | |
+-----------------------------+------------+-----------+-----------+----------+
| Allotted, called up and | 287,343 | 287,343 | 42,075 | 42,075 |
| fully paid 420,750,000 | | | | |
| ordinary shares of 10p each | | | | |
+-----------------------------+------------+-----------+-----------+----------+
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
__________________
22. Share capital (continued)
No ordinary shares were allotted in 2007 or 2008 & the Company does not have any
share options or share warrants in issue at 31 December 2008.
23.Trade and other payables
+----------------------------+------------+-----------+-----------+-----------+
| | Group | Company |
+----------------------------+------------------------+-----------------------+
| | 2008 | 2007 | 2008 | 2007 |
+----------------------------+------------+-----------+-----------+-----------+
| | RM'000 | RM'000 | RM'000 | RM'000 |
+----------------------------+------------+-----------+-----------+-----------+
| | | | | |
+----------------------------+------------+-----------+-----------+-----------+
| Trade payables | 446 | 285 | 322 | 86 |
+----------------------------+------------+-----------+-----------+-----------+
| Capital gains tax payable | 3,986 | 3,986 | 3,986 | 3,986 |
+----------------------------+------------+-----------+-----------+-----------+
| Other payables and | 3,275 | 2,669 | 1,907 | 2,097 |
| accounts | | | | |
+----------------------------+------------+-----------+-----------+-----------+
| | | | | |
+----------------------------+------------+-----------+-----------+-----------+
| | 7,707 | 6,940 | 6,215 | 6,169 |
+----------------------------+------------+-----------+-----------+-----------+
Capital gains tax payable of RM3,986,000 (2006: RM3,986,000) relates to
property gains tax payable on the disposal of freehold land in 2002.
The normal trade credit terms granted to the Group ranges from 30 to 90 days.
24. Bank borrowings
+---------------------------+------------+-----------+-----------+------------+
| | Group | Company |
+---------------------------+------------------------+------------------------+
| | 2008 | 2007 | 2008 | 2007 |
+---------------------------+------------+-----------+-----------+------------+
| Current liabilities: | RM'000 | RM'000 | RM'000 | RM'000 |
+---------------------------+------------+-----------+-----------+------------+
| | | | | |
+---------------------------+------------+-----------+-----------+------------+
| Short-term loans | - | 3,500 | - | 3,500 |
+---------------------------+------------+-----------+-----------+------------+
| Revolving credit loan | 19,955 | 20,208 | 19,955 | 20,208 |
+---------------------------+------------+-----------+-----------+------------+
| | | | | |
+---------------------------+------------+-----------+-----------+------------+
| | 19,955 | 23,708 | 19,955 | 23,708 |
+---------------------------+------------+-----------+-----------+------------+
The short-term loan which was secured on the available-for-sale investments in
quoted shares was
fully settled during the year.
The revolving credit loan, known as Murabahah Tawaruq, is payable to Kuwait
Finance House (Malaysia) Berhad and was obtained for working capital purposes.
The Murabahah profit for the year was 8.10% per annum and is repayable within 90
days from drawdown. Interest incurred during the year was RM1,319,000 (2007 :
RM708,000). This loan facility is secured by:
(a)Lienholders' caveat over a piece of vacant land in Bangi;
(b)irrevocable Letter of Undertaking from the Company to utilize the proceeds
from the proposed sale
of certain plots of land to repay the Murabahah
facility; and
(c)pledge over a bank account of RM805,000 with Kuwait Finance House (Malaysia)
Berhad.
All borrowings are due within one year and are therefore, included in current
liabilities.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
_____________________
25.Finance lease creditors
+-----------------------------------------------+-------------+--+------------+
| Group | 2008 | | 2007 |
| | RM'000 | | RM'000 |
+-----------------------------------------------+-------------+--+------------+
| The Group has the following future minimum | | | |
| finance lease obligations: | | | |
+-----------------------------------------------+-------------+--+------------+
| | | | |
+-----------------------------------------------+-------------+--+------------+
| Repayable within one year | 65 | | 65 |
+-----------------------------------------------+-------------+--+------------+
| Repayable between one and five years | 22 | | 88 |
+-----------------------------------------------+-------------+--+------------+
| | | | |
+-----------------------------------------------+-------------+--+------------+
| | 87 | | 153 |
+-----------------------------------------------+-------------+--+------------+
| Future finance charges | (12) | | (21) |
+-----------------------------------------------+-------------+--+------------+
| | | | |
+-----------------------------------------------+-------------+--+------------+
| Present value of finance leases | 75 | | 132 |
+-----------------------------------------------+-------------+--+------------+
| | | | |
+-----------------------------------------------+-------------+--+------------+
| Amount included in current liabilities | (56) | | (56) |
+-----------------------------------------------+-------------+--+------------+
| | | | |
+-----------------------------------------------+-------------+--+------------+
| Amount included in non-current liabilities | 19 | | 76 |
+-----------------------------------------------+-------------+--+------------+
The fair value of the Group's finance lease obligations approximates their
carrying values. The finance leases are secured by the lessor's rights over the
leased assets. The effective interest rate of the finance leases is 5.3% per
annum.
26.Employee entitlements
+--------------------------------------------------+-----------+--------------+
| Group and Company | | Provision |
| | | for |
| | | employee |
| | |entitlements |
+--------------------------------------------------+-----------+--------------+
| | | RM'000 |
+--------------------------------------------------+-----------+--------------+
| | | |
+--------------------------------------------------+-----------+--------------+
| At 1 January 2008 and 31 December 2008 | | 15 |
+--------------------------------------------------+-----------+--------------+
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
_____________________
27. Financial risk management objectives and policies
The section on "Derivatives and Other Financial Instruments" in the Directors'
Report sets out a description of the Board's practices and policies on financial
instruments.
The Group's principal financial instruments consist of cash and short-term
deposits, bank loans and long term investments. The main purpose of these
financial instruments is to finance the Group's operations and investments. The
Group has other financial instruments such as receivables and payables that
arise directly from its operations.
The Directors recognize that financial risk management is an area in which they
may need to develop specific policies should the Group become exposed to further
financial risks as the business develops.
The main risks arising from the Group's financial instruments are interest rate
risk, liquidity risk, credit risk and market price risk. The Board reviews and
agrees policies for managing each of these risks as and when they arise.
Interest rate risk
The Group's primary interest rate risk relates to short term interest bearing
debt.
The Group also has cash and bank balances and deposits placed with creditworthy
licensed banks. The Group manages its interest rate risks by placing such
balances on varying maturities and interest rate terms.
Liquidity risk
The Group's objective is to maintain a balance of funding and flexibility
through the use of short term loans.
The Group's policy is to arrange for revolving credit as working capital and
short term loans for future acquisition of assets.
Credit risk
The Group and the Company trade only with recognized creditworthy third parties.
The Group and the Company manages the exposures to credit risk by performing
credit evaluations on all of their major customers requiring credit.
As the Group trades only with recognized creditworthy third parties, there is no
requirement for collateral.
Foreign currency risk
The Group does not have any structural currency exposure as all its investments
and operations are in Malaysia.
The Group receives proceeds from the oil palm fresh fruit bunches sales in
Ringgit Malaysia.
Market price risk
The Group is exposed to equity securities price risk because of investments held
by the Group and classified as available-for-sale investments.
Hedges
The Group did not enter into any interest rate swaps or forward currency
contracts to hedge against interest rate risk or foreign currency risk.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
____________________
27. Financial risk management objectives and policies (continued)
Interest rate risk profile of the financial liabilities and financial assets
The interest rate profile of the financial liabilities (bank borrowings and
finance lease creditors) of the Group as at 31 December was as follows:
+----------------------------+---------------+---------------+------------+
| | Fixed rate | Financial | Total |
| | financial | liabilities | |
| | liabilities | on which no | |
| | | interest is | |
| | | paid | |
+----------------------------+---------------+---------------+------------+
| | RM'000 | RM'000 | RM'000 |
+----------------------------+---------------+---------------+------------+
| 2008 | | | |
+----------------------------+---------------+---------------+------------+
| Ringgit Malaysia | 20,030 | - | 20,030 |
+----------------------------+---------------+---------------+------------+
| | | | |
+----------------------------+---------------+---------------+------------+
| 2007 | | | |
+----------------------------+---------------+---------------+------------+
| Ringgit Malaysia | 23,840 | - | 23,840 |
+----------------------------+---------------+---------------+------------+
The interest rate profile of the financial assets (cash and cash equivalents and
available-for-sale investments) of the Group as at 31 December was as follows:
+----------------------------+---------------+---------------+------------+
| | Floating rate | Financial | Total |
| | financial | assets on | |
| | assets | which no | |
| | | interest is | |
| | | paid | |
+----------------------------+---------------+---------------+------------+
| | RM'000 | RM'000 | RM'000 |
+----------------------------+---------------+---------------+------------+
| 2008 | | | |
+----------------------------+---------------+---------------+------------+
| Ringgit Malaysia | 2,271 | 117 | 2,388 |
+----------------------------+---------------+---------------+------------+
| Sterling pound | 5 | - | 5 |
+----------------------------+---------------+---------------+------------+
| | | | |
+----------------------------+---------------+---------------+------------+
| 2007 | | | |
+----------------------------+---------------+---------------+------------+
| Ringgit Malaysia | 3,766 | 534 | 4,300 |
+----------------------------+---------------+---------------+------------+
| Sterling pound | 5 | - | 5 |
+----------------------------+---------------+---------------+------------+
Maturity of fixed rate financial liabilities
The maturity profile of the Group's and Company's financial liabilities at 31
December 2008 comprises
RM20,011,000 (2007: RM23,764,000) due in less than one
year from the balance sheet date and
RM19,000 (2007: RM76,000) due between one
and five years.
Borrowing facilities
The Company and Group do not have any undrawn borrowing facilities.
Fair values of financial assets and financial liabilities
The fair values of financial assets and financial liabilities of the Company and
the Group approximates to their carrying amounts, as disclosed in the balance
sheets and related notes.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
_____________________
27. Financial risk management objectives and policies (continued)
Capital risk management
The Group's objectives when managing capital are
to safeguard the Group's ability to continue as a going concern in order to
provide returns for shareholders and benefits for other stakeholders and to
maintain an optimal capital structure to reduce the cost of capital. In order to
maintain or adjust the capital structure, the Group may return capital to
shareholders, issue new shares or sell assets to reduce debt. Consistent with
others in the industry, the Group monitors capital on the basis of the gearing
ratio. This ratio is calculated as net debt divided by total capital. Net debt
is calculated as total borrowings (including current and non-current borrowings
as shown in the consolidated balance sheet) less cash and cash equivalents.
Total capital is calculated as 'equity' as shown in the consolidated balance
sheet plus net debt.
The gearing ratios at 31 December 2008 and 2007 were as follows:
+-----------------------------------------------------------+-----------------+------------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+-----------------+------------------+
| | RM'000 | RM'000 |
+-----------------------------------------------------------+-----------------+------------------+
| | | |
+-----------------------------------------------------------+-----------------+------------------+
| Bank borrowings | 19,955 | 23,708 |
+-----------------------------------------------------------+-----------------+------------------+
| Finance lease creditors | 75 | 132 |
+-----------------------------------------------------------+-----------------+------------------+
| Less: cash and cash equivalents | (2,276) | (3,771) |
+-----------------------------------------------------------+-----------------+------------------+
| | ___________ | ___________ |
+-----------------------------------------------------------+-----------------+------------------+
| | | |
+-----------------------------------------------------------+-----------------+------------------+
| Net debt | 17,754 | 20,069 |
+-----------------------------------------------------------+-----------------+------------------+
| Total equity | 486,017 | 540,263 |
+-----------------------------------------------------------+-----------------+------------------+
| ___________ | ___________ | |
+-----------------------------------------------------------+-----------------+------------------+
| | | |
+-----------------------------------------------------------+-----------------+------------------+
| Total capital | 503,771 | 560,332 |
+-----------------------------------------------------------+-----------------+------------------+
| | ========== | ========== |
+-----------------------------------------------------------+-----------------+------------------+
| | | |
+-----------------------------------------------------------+-----------------+------------------+
| Gearing ratio | 3.5% | 3.6% |
+-----------------------------------------------------------+-----------------+------------------+
28.Related party transactions
During the year the Group entered into transactions, in the ordinary course of
business, with its related party, Concrete Engineering Products Berhad (the
Company's associated undertaking). Transactions entered into, and trading
balances outstanding at 31 December with the related party, were as follows:
+-----------------+----------------+--------------+-------------+--------------+
| | Sales to | Purchases | Rental | Amount owed |
| | related party | from related | income | by related |
| | | party | | party |
+-----------------+----------------+--------------+-------------+--------------+
| | RM'000 | RM'000 | RM'000 | RM'000 |
+-----------------+----------------+--------------+-------------+--------------+
| | | | | |
+-----------------+----------------+--------------+-------------+--------------+
| 2008 | 7,568 | - | 132 | 160 |
+-----------------+----------------+--------------+-------------+--------------+
| 2007 | - | 4,398 | 198 | 132 |
+-----------------+----------------+--------------+-------------+--------------+
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
____________________
28. Related party transactions (continued)
Compensation of key management personnel of the Group
Key management personnel of the Group are defined as those persons having
authority and responsibility for the planning, directing and controlling the
activities of the Group, directly or indirectly.Key management of the Group are
therefore considered to be the Directors of the Company. There were no
transactions with the key management, other than their emoluments. The
remuneration of key management is set out below in aggregate for the categories
specified in IAS24 "Related party disclosures".
The following table summarizes remuneration paid to key personnel:
+----------------------------------------------+-------------+-------------+
| | Group and Company |
+----------------------------------------------+---------------------------+
| | 2008 | 2007 |
+----------------------------------------------+-------------+-------------+
| | RM'000 | RM'000 |
+----------------------------------------------+-------------+-------------+
| | | |
+----------------------------------------------+-------------+-------------+
| Short-term employment benefits | 74 | 69 |
+----------------------------------------------+-------------+-------------+
Further information about the remuneration of individual Directors is shown
in note 11 above and in the Corporate Governance Statement.
29. Financial commitments under operating leases
The Group and Company have the following future minimum lease obligations
payable under operating
leases:
+-----------------------------------+----------+---------+----------+----------+
| |Land and buildings |Plant and machinery |
| | | |
+-----------------------------------+--------------------+---------------------+
| | 2008 | 2007 | 2008 | 2007 |
+-----------------------------------+----------+---------+----------+----------+
| | RM'000 | RM'000 | RM'000 | RM'000 |
+-----------------------------------+----------+---------+----------+----------+
| Group | | | | |
+-----------------------------------+----------+---------+----------+----------+
| | | | | |
+-----------------------------------+----------+---------+----------+----------+
| Operating leases which expire: | | | | |
+-----------------------------------+----------+---------+----------+----------+
| Within one year | 272 | 408 | - | - |
+-----------------------------------+----------+---------+----------+----------+
| | | | | |
+-----------------------------------+----------+---------+----------+----------+
| Company | | | | |
+-----------------------------------+----------+---------+----------+----------+
| | | | | |
+-----------------------------------+----------+---------+----------+----------+
| Operating leases which expire: | | | | |
+-----------------------------------+----------+---------+----------+----------+
| Within one year | 184 | 276 | - | - |
+-----------------------------------+----------+---------+----------+----------+
| | | | | |
+-----------------------------------+----------+---------+----------+----------+
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER
2008
________________________________________________________________________
_____________________
30. Control
The Company and Group are controlled by its shareholders. No one individual has
overall control of the Company.
31.Events after the balance sheet date
No significant events have occurred since 31 December 2008.
List of Properties Held
as at 31 December 2008
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| Leasehold/ | Tenure | Existing | Land | Age of | Net Book | Date of |
| Title Nos | | Use | Area |Property | Value |Acquisition/Last |
| | | |(Hectare) | (Year) |31/12/2008 | Revaluation |
| | | | | | (RM'000) | |
+----------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| 1| Lot Nos: | Freehold | Oil Palm | 140.25 | 93 | 181,150 | Acquired |
| | | | | | | | in |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 204, 1868 | | Plantation | | | | 24.03.1914 |
| | | | | | | | - |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 505, 1874 | | | | | | 16.06.1916 |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 1875 | | | | | | and last |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 569, 1876 | | | | | | revalued |
| | | | | | | | on |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 626, 1880 | | | | | | 24.03.2009 |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 653, 1881 | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 1005, 1882 | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 1091,1909 | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 1158, 1910 | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 1160, 1912 | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 1204, | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | PT 21625 | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | PT 21628 | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | PT 21630 | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | Kajang estate, Mukim of Semenyih, Daerah Ulu Langat, Selangor |
+--+---------------------------------------------------------------------------------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| 2| Lot Nos: | Freehold | Oil Palm | 243.49 | 93 | 209,680 | Acquired |
| | | | | | | | in |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 540, | | Plantation | | | | 24.03.1914 |
| | | | | | | | - |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | PT 21625 | | | | | | 16.06.1916 |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | PT 21628 | | | | | | and last |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | PT 21630 | | | | | | revalued |
| | | | | | | | on |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | 18.02.2009 |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | Dunedin estate, Mukim of Semenyih, Daerah Ulu Langat, Selangor |
+--+---------------------------------------------------------------------------------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| 3| HS (D) | Leasehold | Resort | 9.947 | 19 | 5,249 | Acquired |
| | 1470 | | | | | | in |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | PT Lot | expiring | Land and | | | | 18.08.1990 |
| | 354 | in | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | 2051 | Buildings | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | Mukim of Pulau Perhentian, Daerah Besut, | | | |
| | Terengganu | | | |
+--+--------------------------------------------------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| 4| 15-06A | Leasehold | Apartment | 91sq. m. | 14 | 94 | Acquired |
| | | | | | | | in |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | Amber | expiring | | | | | 30.06.2003 |
| | Tower | in | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | Seri Mas | 2085 | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | Condominium | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | Batu 3 ½ | | | | | | |
| | Cheras | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | 56000 | | | | | | |
| | Kuala | | | | | | |
| | Lumpur | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | 396,173 | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
| | | | | | | | |
+--+-------------+-----------+------------+-----------+----------+------------+------------------+
This information is provided by RNS
The company news service from the London Stock Exchange
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