C ON TE NTS
01
CORPORATE INFORMATION
02
NOTICE OF ANNUAL GENERAL MEETING
07
STATEMENT ACCOMPANYING THE NOTICE OF AGM
08
FINANCIAL HIGHLIGHTS
09
CORPORATE STRUCTURE
10
DIRECTORS’ PROFILE
12
AUDIT COMMITTEE REPORT
16
STATEMENT ON CORPORATE GOVERNANCE
23
STATEMENT ON DIRECTORS’ RESPONSIBILITY
24
STATEMENT ON INTERNAL CONTROL
26
EXECUTIVE CHAIRMAN’S STATEMENT
29
FINANCIAL STATEMENTS
80
ANALYSIS OF SHAREHOLDINGS
82
LIST OF PROPERTIES
PROXY FORM
C
ORPORATE INFORMATION
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
BOARD OF DIRECTORS
PRINCIPAL BANKERS
Tiang Ming Sing
(Executive Chairman)
Bumiputra-Commerce Bank Berhad
OCBC Bank (M) Berhad
HSBC Bank Malaysia Berhad
Hong Leong Bank Berhad
Malayan Banking Berhad
Alliance Bank Malaysia Berhad
EON Bank Berhad
Public Bank Berhad
Tiang Ching Kok
(Managing Director)
Datuk Hajjah Raziah @ Rodiah Binti Mahmud
(Independent Non-Executive Director)
Edmund Goh Chze Jin
(Executive Director)
Robin Lo Bing
(Independent Non-Executive Director)
Michael Ong Kee Tuan
(Independent Non-Executive Director)
Alfed Ong Sze Lee
(Non-Executive Director)
STOCK EXCHANGE LISTING
Second Board
Bursa Malaysia Securities Berhad
Stock Code: 7544
Stock Name: QUALITY
COMPANY SECRETARY
Yeo Puay Huang
(LS000577)
REGISTERED OFFICE
Room 209, 2nd Floor
Wisma Bukit Mata Kuching
Jalan Tunku Abdul Rahman
93100 Kuching, Sarawak
Tel:
6082-206600
Fax:
6082-206607
E-mail: [email protected]
SHARE REGISTRAR
Securities Services (Holdings) Sdn Bhd
Level 7, Menara Milenium
Jalan Damanlela
Pusat Bandar Damansara
Damansara Heights
50490 Kuala Lumpur
Tel:
603-20849000
Fax:
603-20949940
AUDITORS
Ernst & Young
Chartered Accountants
3rd Floor, Wisma Bukit Mata Kuching
Jalan Tunku Abdul Rahman
93100 Kuching, Sarawak
Tel:
6082-243233
Fax:
6082-421287
>> 01
N
OTICE OF ANNUAL GENERAL MEETING
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
NOTICE IS HEREBY GIVEN that the Ninth Annual General Meeting of QUALITY CONCRETE HOLDINGS
BERHAD will be held at Room 209, 2nd Floor, Wisma Bukit Mata Kuching, Jalan Tunku Abdul Rahman, 93100
Kuching, Sarawak, on Friday, 15 July 2005 at 10:00 a.m. for the following purposes :ORDINARY BUSINESS
1.
Adoption of Financial Statements
To receive and adopt the Audited Financial Statements and reports of Directors and
Auditors for the financial year ended 31 January 2005.
2.
Resolution 1
Re-Election of Directors
In accordance with Article 67 of the Company’s Articles of Association, the following
Director retire from the Board and being eligible, offer himself for re-election:
Mr. Michael Ong Kee Tuan
Resolution 2
In accordance with Article 75 of the Company’s Articles of Association, the following
Directors retire from the Board and being eligible, offer themselves for re-election:
Mr. Tiang Ching Kok
Mr. Robin Lo Bing
3.
Approval of Directors’ Fee
To approve Directors’ fees in respect of the financial year ended 31 January 2005.
4.
Resolution 3
Resolution 4
Resolution 5
Re-Appointment of Auditors
To re-appoint Messrs. Ernst & Young as Auditors and to authorise the Directors to fix
their remuneration.
Resolution 6
SPECIAL BUSINESS
To consider and, if thought fit, to pass the following as ordinary resolutions:
5.
To authorise Directors to allot and issue shares pursuant to Section 132D of the
Companies Act, 1965
“That pursuant to Section 132D of the Companies Act, 1965 approval be and is hereby
given to the Directors to issue shares in the Company at any time and upon such terms
and conditions and for such purposes as the Directors may, in their absolute discretion,
deem fit, provided that the aggregate number of shares to be issued does not exceed
ten (10) percent of the issued share capital of the Company for the time being, subject
always to the approval of the relevant regulatory authorities being obtained for such
allotment and issue.”
6.
Proposed Allocation of Share Options to Edmund Goh Chze Jin
“That the Board of Directors be and is hereby authorised to offer and grant to Edmund
Goh Chze Jin, Executive Director of the Company, Options to subscribe for 500,000
new ordinary share under the ESOS subject always to such terms and conditions which
may be made in accordance with the provisions of the Bye-Laws of the ESOS.”
7.
Proposed Shareholders’ Mandate On Recurrent Related Party Transactions of A
Revenue Or Trading Nature with Lee Ling Construction & Development Sdn. Bhd.;
Lee Ling Timber Sdn. Bhd.; BMK Development Sdn. Bhd. and Lee Ling Shipping
Sdn. Bhd.
“That approval be and is hereby given to the Company and its subsidiaries to enter into
and give effect to specific recurrent related party transactions of a revenue or trading
nature with Lee Ling Construction & Development Sdn. Bhd.; Lee Ling Timber Sdn.
>> 02
Resolution 7
Resolution 8
N
OTICE OF ANNUAL GENERAL MEETING
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
Bhd.; BMK Development Sdn. Bhd. and Lee Ling Shipping Sdn. Bhd. (details as
mentioned in Section 2.3 of the Circular to Shareholders dated 14 June 2005) and
falling within the ambit of Part E, Paragraph 10.09 of Chapter 10 of the Listing
Requirements of the Bursa Malaysia Securities Berhad, which were or are necessary
for Quality Concrete Holdings Berhad and its subsidiaries’ day to day operations and
undertaken in the ordinary course of business of the company, on terms not more
favourable to Lee Ling Construction & Development Sdn. Bhd.; Lee Ling Timber Sdn.
Bhd.; BMK Development Sdn. Bhd. and Lee Ling Shipping Sdn. Bhd. than those generally
available to the public and not to the detriment of minority shareholders of the Company;
That such approval unless revoked or varied by the Company in general meeting shall
continue to be in full force and effect until;
i)
the conclusion of the next Annual General Meeting of the Company at which time
it will lapse, unless by a resolution passed at the meeting, the authority is renewed;
ii)
the expiration of the period within which the next Annual General Meeting is required
to be held pursuant to Section 143(1) of the Companies Act, 1965 (but shall not
extend to such extensions as may be allowed pursuant to Section 143(2) of the
Companies Act, 1965); or
iii)
revoked or varied by resolution passed by the shareholders in general meeting.
whichever is earlier.”
And that the Directors of the Company be authorised to complete and do all such acts
and things as they may consider expedient or necessary to give effect to this resolutions.”
8.
Resolution 9
Proposed Shareholders’ Mandate On Recurrent Related Party Transactions of A
Revenue Or Trading Nature with Jurudaya Construction Sdn. Bhd. and Datuk Haji
Mazelan Bin Bugo
“That approval be and is hereby given to the Company’s subsidiary to enter into and
give effect to specific recurrent related party transactions of a revenue or trading nature
with Jurudaya Construction Sdn. Bhd. and Datuk Haji Mazelan Bin Bugo (details as
mentioned in Section 2.3 of the Circular to Shareholders dated 14 June 2005) and
falling within the ambit of Part E, Paragraph 10.09 of Chapter 10 of the Listing
Requirements of the Bursa Malaysia Securities Berhad , which were or are necessary
for Quality Concrete Holdings Berhad’s subsidiary day to day operations and undertaken
in the ordinary course of business of the company, on terms not more favourable to
Jurudaya Construction Sdn. Bhd. and Datuk Haji Mazelan Bin Bugo than those generally
available to the public and not to the detriment of minority shareholders of the Company;
That such approval unless revoked or varied by the Company in general meeting shall
continue to be in full force and effect until;
i)
the conclusion of the next Annual General Meeting of the Company at which time
it will lapse, unless by a resolution passed at the meeting, the authority is renewed;
ii)
the expiration of the period within which the next Annual General Meeting is required
to be held pursuant to Section 143(1) of the Companies Act, 1965 (but shall not
extend to such extensions as may be allowed pursuant to Section 143(2) of the
Companies Act, 1965); or
iii)
revoked or varied by resolution passed by the shareholders in general meeting.
whichever is earlier.”
And that the Directors of the Company be authorised to complete and do all such acts
and things as they may consider expedient or necessary to give effect to this resolutions.”
Resolution 10
>> 03
N
OTICE OF ANNUAL GENERAL MEETING
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
9.
Proposed Shareholders’ Mandate On Recurrent Related Party Transactions of A
Revenue Or Trading Nature with Chung Maa Machinery Sdn. Bhd.
“That approval be and is hereby given to the Company’s subsidiary to enter into and
give effect to specific recurrent related party transactions of a revenue or trading nature
with Chung Maa Machinery Sdn. Bhd. (details as mentioned in Section 2.3 of the Circular
to Shareholders dated 14 June 2005) and falling within the ambit of Part E, Paragraph
10.09 of Chapter 10 of the Listing Requirements of the Bursa Malaysia Securities Berhad,
which were or are necessary for Quality Concrete Holdings Berhad’s subsidiary day to
day operations and undertaken in the ordinary course of business of the company, on
terms not more favourable to Chung Maa Machinery Sdn. Bhd. than those generally
available to the public and not to the detriment of minority shareholders of the Company;
That such approval unless revoked or varied by the Company in general meeting shall
continue to be in full force and effect until;
i)
the conclusion of the next Annual General Meeting of the Company at which time
it will lapse, unless by a resolution passed at the meeting, the authority is renewed;
ii)
the expiration of the period within which the next Annual General Meeting is required
to be held pursuant to Section 143(1) of the Companies Act, 1965 (but shall not
extend to such extensions as may be allowed pursuant to Section 143(2) of the
Companies Act, 1965); or
iii)
revoked or varied by resolution passed by the shareholders in general meeting.
whichever is earlier.”
And that the Directors of the Company be authorised to complete and do all such acts
and things as they may consider expedient or necessary to give effect to this resolutions.”
10.
Resolution 11
Proposed Shareholders’ Mandate On Recurrent Related Party Transactions of A
Revenue Or Trading Nature with Pahaytc Sdn. Bhd.
“That approval be and is hereby given to the Company’s subsidiary to enter into and
give effect to specific recurrent related party transactions of a revenue or trading nature
with Pahaytc Sdn. Bhd. (details as mentioned in Section 2.3 of the Circular to
Shareholders dated 14 June 2005) and falling within the ambit of Part E, Paragraph
10.09 of Chapter 10 of the Listing Requirements of the Bursa Malaysia Securities Berhad,
which are necessary for Quality Concrete Holdings Berhad’s subsidiary day to day
operations and undertaken in the ordinary course of business of the company, on terms
not more favourable to Pahaytc Sdn. Bhd. than those generally available to the public
and not to the detriment of minority shareholders of the Company;
That such approval unless revoked or varied by the Company in general meeting shall
continue to be in full force and effect until;
i)
the conclusion of the next Annual General Meeting of the Company at which time
it will lapse, unless by a resolution passed at the meeting, the authority is renewed;
ii)
the expiration of the period within which the next Annual General Meeting is required
to be held pursuant to Section 143(1) of the Companies Act, 1965 (but shall not
extend to such extensions as may be allowed pursuant to Section 143(2) of the
Companies Act, 1965); or
iii)
revoked or varied by resolution passed by the shareholders in general meeting.
whichever is earlier.”
And that the Directors of the Company be authorised to complete and do all such acts
and things as they may consider expedient or necessary to give effect to this resolutions.”
>> 04
Resolution 12
N
OTICE OF ANNUAL GENERAL MEETING
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
11.
Proposed Shareholders’ Mandate On Recurrent Related Party Transactions of A
Revenue Or Trading Nature with Kumpulan Parabena Sdn. Bhd.
“That approval be and is hereby given to the Company’s subsidiary to enter into and
give effect to specific recurrent related party transactions of a revenue or trading nature
with Kumpulan Parabena Sdn. Bhd. (details as mentioned in Section 2.3 of the Circular
to Shareholders dated 14 June 2005) and falling within the ambit of Part E, Paragraph
10.09 of Chapter 10 of the Listing Requirements of the Bursa Malaysia Securities Berhad,
which are necessary for Quality Concrete Holdings Berhad’s subsidiary day to day
operations and undertaken in the ordinary course of business of the company, on terms
not more favourable to Kumpulan Parabena Sdn. Bhd. than those generally available to
the Public and not to the detriment of minority shareholders of the Company;
That such approval unless revoked or varied by the Company in general meeting shall
continue to be in full force and effect until;
i)
the conclusion of the next Annual General Meeting of the Company at which time
it will lapse, unless by a resolution passed at the meeting, the authority is renewed;
ii)
the expiration of the period within which the next Annual General Meeting is required
to be held pursuant to Section 143(1) of the Companies Act, 1965 (but shall not
extend to such extensions as may be allowed pursuant to Section 143(2) of the
Companies Act, 1965); or
iii)
Revoked or varied by resolution passed by the shareholders in general meeting.
whichever is earlier.”
And that the Directors of the Company be authorised to complete and do all such acts
and things as they may consider expedient or necessary to give effect to this resolutions.”
12.
Resolution 13
To transact any other business for which due notice shall have been given.
By Order of the Board,
Yeo Puay Huang
Company Secretary
Dated : 14 June 2005
>> 05
N
OTICE OF ANNUAL GENERAL MEETING
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
Explantory Notes to Special Business
a) Resolution pursuant to Section 132D of the Companies Act, 1965
In line with the Company’s plan for expansion/diversification, the Company is continuously looking into
prospective areas so as to broaden the operating base and earning potential of the Company. As the
expansion/diversification may involve the issue of new shares, the Directors, under present circumstances,
would have to call for a general meeting to approve the issue of new shares even though the number
involved is less than 10% of the issued capital. In order to avoid any delay and costs involved in convening
a general meeting to approve such issue of shares, it is thus considered appropriate that the Directors be
empowered to issue shares in the Company up to an amount not exceeding in total 10% of the issued
share capital of the Company for the time being for such purposes as they consider would be in the interest
of the Company. This authority, unless revoked or varied at a general meeting, will expire at the next
Annual General Meeting of the Company.
b) Proposed Allocation of Share Options to Edmund Goh Chze Jin
The proposed Ordinary Resolution No. 8 is to empower the Directors of the Company to grant options to
Executive Director of the Company to subscribe the shares in the Company under the ESOS scheme and
from time to time to allot and issue such percentage of ordinary shares not exceeding the percentage set
out in the Bye-Law of the ESOS.
c)
Proposed General Mandate for Recurrent Related Party Transactions
For further information on Ordinary Resolutions No. 9-13, please refer to the Circular to Shareholders
dated 14 June 2005.
Notes :
1.
A member entitled to attend and vote at the meeting is entitled to appoint a proxy or proxies to attend
and vote in his/her place. A proxy need not be a member of the Company. Where a holder appoints
two or more proxies, he/she shall specify the proportion of his/her shareholdings to be represented by
each proxy.
2.
A corporation which is a member may by resolution of its directors authorise such person as it thinks
fit to act as its representative at the meeting pursuant to Section 147 of the Companies Act, 1965.
3.
The instrument appointing a proxy shall be in writing under the hand of the appointer or of his/her
attorney, and the person so appointed may attend and vote at the meeting at which the appointer is
entitled to vote.
4.
The instrument appointing a proxy or representative must be deposited at the registered office, Room
209, 2nd Floor, Wisma Bukit Mata Kuching, Jalan Tunku Abdul Rahman, 93100 Kuching, not less
than forty-eight (48) hours before the time for holding the meeting.
>> 06
S
TATEMENT ACCOMPANYING NOTICE OF ANNUAL GENERAL MEETING
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
1. Directors standing for re-election
Pursuant to Paragraph 8.28(2) of the Listing Requirements, the Directors who are standing for re-election at
the Nineth Annual General Meeting of the Company are as follows:
•
•
•
Michael Ong Kee Tuan - Article 67
Tiang Ching Kok - Article 75
Robin Lo Bing - Article 75
2. Details of attendance of Directors at Board Meetings
Please refer to page 17 for details.
3. Place, date and hour of Annual General Meeting
Room 209, 2nd Floor, Wisma Bukit Mata Kuching, Jalan Tunku Abdul Rahman, 93100 Kuching, Sarawak
on Friday, 15 July 2005 at 10:00 a.m.
4. Further details of Directors seeking re-election at the Ninth Annual General Meeting can be found in
the pages 10 and 11 of the Annual Report.
>> 07
Earnings per share
(SEN)
>> 08
2005
2004
Shareholders’ funds
(RM �000)
2005
2004
133,449
128,401
115,839
2003
(RM �000)
2005
2004
2003
2002
2001
Total assets
114,764
2005
2004
4,295
5,976
6,893
191,123
198,580
181,051
169,086
162,352
12,335
2005
2004
2003
2002
2001
2005
2004
2003
2002
2001
(RM �000)
2002
100,336
21
2003
2002
9,640
Profit before tax
2001
7
10
(RM �000)
2003
13
Net profit
2001
(RM �000)
2002
19
Revenue
2001
6,550
8,045
8,469
11,470
15,585
156,158
161,237
145,881
120,358
120,034
F
INANCIAL HIGHLIGHTS
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
Manufacture and
sale of high
density
polyethylene pipes
and fittings
вћ¤
Manufacture and
sale of readymixed concrete,
sale of concrete
products and
trading of goods
вћџ
Quality Concrete
(Mukah)
Sdn. Bhd.
70%
вћ¤
* Acquired after 31 January 2005
Dormant
Incorporated In Malaysia
Quality Concrete Holdings Berhad (378282-D)
>> 09
Quarry operations
and sale of
aggregates and
related products
Manufacture and
sale of high
density
polyethylene pipes
and fittings
вћ¤
Property
Development
вћ¤
Sawmilling and
Manufacture of
other downstream
timber products
вћ¤
Manufacture and
sale of woven
polypropylene
bags and
polyethylene liners
Agrowell
Sdn. Bhd.
Hong Wei
Holdings Sdn.
Bhd.
Lee Ling Timber
Products
Sdn. Bhd.
Kutex
Sdn. Bhd.
вћџ
вћ¤
Polyflow (B)
Sdn. Bhd.*
вћџ
вћ¤
Polyflow Pipe
Sdn. Bhd.
вћџ
вћ¤
Quality Concrete
Sdn. Bhd.
100%
100%
100%
100%
вћџвћџ
55%
вћџ
100%
вћџ
100%
вћџ
D
IRECTORS’ PROFILE
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
Standing from left to right:
Robin Lo Bing,
Michael Ong Kee Tuan,
Alfed Ong Sze Lee,
Edmund Goh Chze Jin.
Sitting from left to right:
Datuk Hajjah Raziah @
Rodiah Binti Mahmud,
Tiang Ming Sing,
Tiang Ching Kok.
TIANG MING SING
Executive Chairman
• Aged 54, Malaysian
• Chairman of the ESOS Committee
• Member of Remuneration & Nomination Committee
Mr. Tiang Ming Sing was appointed to the Board as Executive
Chairman on 17 January 2000. Mr. Tiang is also a director of two
of the Group’s subsidiaries. He is a successful businessman who
has extensive experience and knowledge in the timber and
property development business. He started his career in the
timber upstream business after completing his secondary
education and has since expanded to the timber downstream
business. He is also involved in property investment, property
development and the construction industry. He presently holds
directorships in other various private companies that make up
the Lee Ling Group. He has no other personal interest in any
business arrangement involving the Group, except for those
disclosed on pages 77 to 78 of this Annual Report. Mr. Tiang
holds 6,915,000 shares in the Company. He attended all the three
(3) Board Meetings held in the financial year ended 31 January
2005. He has no convictions for any offences within the past 10
years.
Mr. Tiang is the father to Mr. Tiang Ching Kok.
TIANG CHING KOK
Managing Director
• Aged 31, Malaysian
• Member of the ESOS Committee
>> 10
Mr. Tiang Ching Kok was appointed to the Board of on 2 January
2002. He graduated with a Bachelor of Commerce degree from
Deakin University, Australia in 1996 and joined Earthmover Group
of Companies in 1996 as Executive Director and was responsible
for the overall management of the group. His valuable
management experience in sawmilling and logging activities is an
asset to QC Group as one of QCHB’s subsidiaries, Lee Ling Timber
Products Sdn Bhd, is also involved in the timber business. Mr.
Tiang Ching Kok is also a director of all of the QCHB’s subsidiaries.
He has no other personal interest in any business arrangement
involving the Company, except for those disclosed on pages 77
to 78 of this Annual Report. He attended all the three (3) Board
Meetings held in the financial year ended 31 January 2005. He
has no convictions for any offences within the past 10 years.
He is the son to Mr. Tiang Ming Sing.
DATUK HAJJAH RAZIAH @ RODIAH BINTI MAHMUD
Independent Non-Executive Director
• Aged 49, Malaysian
Datuk Hajjah Raziah @ Rodiah Binti Mahmud was appointed to
the Board on 17 January 2000 and is also the Chairperson of
Polyflow Pipes Sdn. Bhd. Datuk Raziah attended Business Studies
from University Technology Mara and she is also a Licensed
Company Secretary. Datuk Raziah is a successful entrepreneur
and has been involved in diverse business activities for the past
16 years. She was awarded the Innovative Women Entrepreneur
of the Year by The National Association of Women Entrepreneurs
in construction and property of Malaysia on 10 October 2004. She
is also The Honorary Consul of the Republic of Poland since 29
August 2000.
D
IRECTORS’ PROFILE
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
She is also the Executive Chairperson of Kumpulan Construction
Sdn Bhd and Majupun Sdn Bhd, Managing Director of Kumpulan
Parabena Sdn Bhd and Executive Director of Borsamulu Resort
Sdn Bhd. Datuk Raziah also sits on the Board of Eksons
Corporation Berhad as Independent & Non-Executive Director
since November 2001. She does not have any family relationship
with any director and/or major shareholder of QCHB, nor any
personal interest in any business arrangement involving the
Company. Datuk Raziah holds 1,179,000 shares in the Company.
She attended all the three (3) Board Meetings held in the financial
year ended 31 January 2005. She has no convictions for any
offences within the past 10 years.
EDMUND GOH CHZE JIN
Executive Director
• Aged 34, Malaysian
• Member of the ESOS & Audit Committee
Mr. Edmund Goh was appointed to the Board on 11 November
2003. He graduated with a Bachelor of Business degree majoring
in Accountancy from RMIT University, Australia in 1994. He is
also an associate member of the CPA Australia. He was attached
with ESSO Malaysia Berhad in 1993 and
PriceWaterhouseCoopers in 1995 where he was involved in
auditing and management consultancy works. He joined
AmMerchant Bank Berhad in 1997 specializing in Corporate
Finance and was promoted to a Manager in 2002. He left
AmMerchant Bank to join QCHB in November 2003. Mr. Goh is
also a director of seven of the Group’s subsidiaries. He does not
have any family relationship with any director and/or major
shareholder of QCHB, nor any personal interest in any business
arrangement involving the Company. He attended all the three
(3) Board Meetings held in the financial year ended 31 January
2005. He has no convictions for any offences within the past 10
years.
ROBIN LO BING
Independent Non-Executive Director
• Aged 59, Malaysian
• Member of Audit, Remuneration & Nomination Committee
Mr. Lo was appointed to the Board on 2 May 2002. He graduated
with a Bachelor of Science (Hons) in Applied Science from
University of Nottingham, UK in 1976. Mr. Lo is the Chairman of
Kutex Sdn Bhd. He had previously served as Chief Executive
Officer of Encorp Group Sdn Bhd, Group Managing Director of
Sarawak Economic Development Corporation and Chief Executive
Officer of Gold Coin Sarawak Sdn Bhd. He is a director of Sarawak
Flour Mill Sdn Bhd, Prestasi Flour Mill (M) Sdn Bhd & Bintawa
Fishmeal Factory Sdn Bhd. He does not have any family
relationship with any director and/or major shareholder of QCHB,
nor any personal interest in any business arrangement involving
the Company. Mr. Lo holds 272,405 shares in the Company. He
attended all the three (3) Board Meetings held in the financial
year ended 31 January 2005. He has no convictions for any
offences within the past 10 years.
MICHAEL ONG KEE TUAN
Independent Non-Executive Director
• Aged 59, Malaysian
• Chairman of Audit Committee
• Member of Remuneration & Nomination Committee
Mr. Ong was appointed to the Board on 8 May 2004. He graduated
with a Bachelor of Economics (Honours) degree from University
of Malaya in 1971 and was admitted as a Barrister of the
Honourable Society of Middle Temple London in 1977. Mr. Ong is
a member of the Malaysian Institute of Accountants, the Chartered
Institute of Arbitrators (U.K.), Malaysian Association of Company
Secretaries, the Chartered Management Institute (U.K.) and fellow
member of the Malaysian Institute of Taxation and Association of
Chartered Certified Accountants (U.K.). He joined Standard
Chartered Bank after his graduation as Officer Trainee and
subsequently worked for Audit Department as Auditor. Prior to
commencement of his legal practice, he was the branch manager
of an audit firm. He does not have any family relationship with
any director and/or major shareholder of QCHB, nor any personal
interest in any business arrangement involving the Company. He
attended all the three (3) Board Meetings held in the financial
year ended 31 January 2005. He has no convictions for any
offences within the past 10 years.
ALFED ONG SZE LEE
Non-Executive Director
• Aged 36, Malaysian
Mr. Alfed Ong was appointed to the Board on 23 June 1999. He
holds a Commerce degree from Edith Cowan University of Perth,
Western Australia. He joined Phileo Allied Bank (Malaysia) Bhd
in 1995 as an officer before joining Quality Concrete Sdn Bhd as
Credit Manager in July 1999. He does not have any family
relationship with any director and/or major shareholder of QCHB,
nor any personal interest in any business arrangement involving
the Company. He attended all the three (3) Board Meetings held
in the financial year ended 31 January 2005. He has no convictions
for any offences within the past 10 years.
>> 11
A
UDIT COMMITTEE REPORT
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
The Board of Directors of Quality Concrete Holdings Berhad is pleased to present the report of the Audit Committee
of the Board for the year ended 31 January 2005.
The Audit Committee was established by a resolution of the Board on 7 October 1996.
MEMBERS AND MEETINGS
The members of the Audit Committee during the year comprised the directors listed below. During the year
ended 31 January 2005, the Audit Committee held a total of five (5) meetings.
Name
Status of directorship
Independent
Attendance of meetings
Cheng Ah Teck @
Cheng Yik Lai*
Independent Non-Executive
Director, Chairman of Audit
Committee
Yes
Attended 1 out of 1 meeting
held
Michael Ong Kee Tuan**
Independent Non-Executive
Director, Chairman of Audit
Committee
Yes
Attended 4 out of 4 meetings
held
Robin Lo Bing
Independent Non-Executive
Director
Yes
Attended 5 out of 5 meetings
held
Edmund Goh Chze Jin
Executive Director
No
Attended 5 out of 5 meetings
held
* Mr. Cheng Ah Teck resigned from the Board on 5 April 2004.
** Mr. Michael Ong Kee Tuan was appointed to the Board on 8 May 2004.
TERMS OF REFERENCE
The terms of reference of the Audit Committee are as follows:
Membership
The Audit Committee shall be appointed by the Board from amongst their number and shall consist of not less
than three (3) members, a majority of whom shall be independent directors with at least one of whom shall be a
member of the Malaysian Institute of Accountants or a member who fulfils the requirements stated in Paragraph
15.10 (1) (c) (ii) and Practice Note No. 13/2002, (Paragraph 7) of the listing requirements of the Bursa Malaysia
Securities. The Chairman of the Audit Committee shall be an independent non-executive director appointed by
the Board.
Meetings and minutes
Meetings shall be held not less than four (4) times a year and the Group Managing Director, Group Internal
Auditor and a representative of the external auditors shall normally be invited to attend the meetings. Other
members of the Board may attend the meetings upon the invitation of the Audit Committee. At least once a year,
the Audit Committee shall meet the external auditors without any executive directors present. A quorum shall be
two (2) members present and a majority of whom must be independent directors. Minutes of each meeting shall
be kept and distributed to each number of the Audit Committee and of the Board. The Chairman of the Audit
Committee shall report on each meeting to the Board. The Secretary to the Audit Committee shall be the
Company Secretary.
>> 12
A
UDIT COMMITTEE REPORT
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
Authority
The Audit Committee is authorised by the Board:
i.
to investigate any activity within its terms of reference and shall have unrestricted access to both the
internal and external auditors and to all employees of the Group;
ii.
to have the resources in order to perform its duties as set out in its terms of reference;
iii.
to have full and unrestricted access to information pertaining to the Company and the Group;
iv.
to have direct communication channels with the internal and external auditors; and
v.
to obtain external legal or other independent professional advice as necessary.
Notwithstanding anything to the contrary hereinbefore stated, the Audit Committee does not have executive
powers and shall report to the Board of Directors on matters considered and its recommendations thereon,
pertaining to the Company and the Group.
Responsibility
Where the Audit Committee is of the view that a matter reported by it to the Board of Directors has not been
satisfactorily resolved resulting in a breach of the Listing Requirements of Bursa Malaysia Securities, the Audit
Committee has the responsibility to promptly report such matter to the Bursa Malaysia Securities Berhad.
REVIEW OF THE COMPOSITION OF THE AUDIT COMMITTEE
The term of office and performance of the Audit Committee and each of the members shall be reviewed by the
Board of Directors at least once every three (3) years to determine whether the Audit Committee and its members
have carried out their duties in accordance with their terms of reference.
Duties
The duties of the Audit Committee are:
i.
to consider the appointment, resignation and dismissal of external auditors and the audit fee;
ii.
to review the nature and scope of the audit with the internal and external auditors before the audit
commences;
iii.
to review the quarterly and annual financial statements of the Company and the Group focusing on the
matters set out below, and thereafter to submit them to the Board:
•
•
•
•
iv.
any changes in accounting policies and practices;
significant adjustments arising from the audit;
the going concern assumption; and
compliance with accounting standards and regulatory requirements;
to discuss problems and reservations arising from the interim and final audits, and any matter the external
auditors may wish to discuss;
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A
UDIT COMMITTEE REPORT
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
v.
to review the audit reports prepared by the internal and external auditors, the major findings and
management’s responses thereto;
vi.
to review the adequacy of the scope, functions and resources of the internal and management audit
department and whether it has the necessary authority to carry out its work;
vii. to consider the report, major findings and management’s response thereto on any internal investigations
carried out by the internal auditors;
viii. to review any appraisal or assessment of the performance of executive(s) in the internal and management
audit department;
ix.
to approve any appointment or termination of executive(s) in the internal and management audit department;
x.
to be informed of any resignation of executives in the internal and management audit department and to
provide the resigning executive an opportunity to submit his/her reason for resignation;
xi.
to review the evaluation of the systems of internal control with the auditors;
xii. to review the assistance given by the Company’s and the Group’s employees to the auditors;
xiii. to review related party transactions entered into by the Company and the Group to ensure that such
transactions are undertaken on the Group’s normal commercial terms and that the internal control procedures
with regards to such transactions are sufficient; and
xiv. any such other functions as may be agreed to by the Audit Committee and the Board.
ACTIVITIES OF THE AUDIT COMMITTEE DURING THE YEAR
In line with the terms of reference of the Audit Committee, the following activities were carried out by the Audit
Committee during the year ended 31 January 2005 in the discharge of its functions and duties:
i.
review of the audit plans for the year for the Company and the Group prepared by the internal and external
auditors;
ii.
review of the audit reports for the Company and the Group prepared by the internal and external auditors
and consideration of the major findings by the auditors and management’s responses thereto;
iii.
review of the quarterly and annual reports of the Company and the Group prior to submission to the Board
of Directors for consideration and approval;
iv.
review of the disclosure on related party transactions entered into by the Company and the Group in the
annual report of the Company;
v.
review of the Circular to shareholders in relation to the General Mandate for recurring related party
transactions before recommending it for the Board of Directors’ approval;
vi.
commissioning of special reviews on specific areas of financial operations of the Group; and
vii. meet with the external auditors in the absence of management except the Company Secretary.
>> 14
A
UDIT COMMITTEE REPORT
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
INTERNAL AUDIT FUNCTIONS
The Company has an Internal and Management Audit Department whose principal responsibility is to undertake
regular and systematic reviews of the systems of controls so as to provide reasonable assurance that such
systems continue to operate satisfactorily and effectively in the Company and the Group. The Department is
also responsible for the conduct of regular and systematic reviews of environmental, safety and health issues in
the Company and the Group. The attainment of such objective involves the following activities being carried out
by the Department:
i.
reviewing and appraising the soundness, adequacy and application of accounting, financial and other
controls and promoting effective control in the Company and the Group at reasonable cost;
ii.
ascertaining the extent of compliance with established policies, procedures and statutory requirements;
iii.
ascertaining the extent to which the Company’s and the Group’s assets are accounted for and safeguarded
from losses of all kinds;
iv.
appraising the reliability and usefulness of information developed within the Company and the Group for
management;
v.
recommending improvements to the existing systems of controls;
vi.
carrying out audit work in liaison with the external auditors to maximize the use of resources and for
effective coverage of audit risks;
vii. carrying out investigations and special reviews requested by management and/or the Audit Committee of
the Company; and
viii. identifying opportunities to improve the operations of and processes in the Company and the Group.
STATEMENT VERIFYING ALLOCATION OF OPTIONS
The Audit Committee has reviewed and verified that the allocation of share options pursuant to the Employees’
Share Options Scheme (�ESOS’) for the year ended 31 January 2005 was made in accordance with the provisions
set out in the Bye-Laws of the ESOS.
>> 15
S
TATEMENT ON CORPORATE GOVERNANCE
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
THE CODE
The Board of Quality Concrete Holdings Berhad (�Board’) is committed in ensuring that the principles and best
practices on structures and processes as sets out in the Malaysian Code on Corporate Governance (�Code’)
are practiced throughout the Group as a fundamental part of discharging its responsibilities to protect and
enhance shareholder value and financial performance of the Group and the Company.
Details on how the Company has applied the principles and complied with the best practices set out in part I
and II of the Code, pursuant to Paragraph 15.26 of the Listing Requirements of Bursa Malaysia Securities are
reported as below.
1. The Board of Directors
1.1 Board composition and balance
The Board has the overall responsibility for corporate governance, strategic direction and overseeing
the investments of the Company. The Group is led and managed by an experienced Board. Collectively,
the Directors have a wide range of legal, business, financial and technical experience. The mix of
skills and experience is vital for the successful direction of the Group. A brief profile of each Director
is presented on pages 10 to 11.
The Board currently has seven (7) members, comprising four (4) Non-Executive Directors and three
(3) Executive Directors. Three of the Seven Directors are Independent Directors, which complies with
the statutory requirement of a minimum of one-third.
1.2 Roles and responsibilities
There is a clear division of responsibility between the Executive Chairman and the Group Managing
Director to ensure that there is a balance of power and authority. The roles of the Chairman and the
Group Managing Director are separated and clearly defined. The Chairman is responsible for the
Group’s corporate affairs and development and he is also tasked with ensuring the effectiveness and
conduct of the Board in carried out its duties and responsibilities whilst the Group Managing Director
has overall responsibilities over the operating units, organisational effectiveness and implementation
of Board policies and decisions.
The presence of Independent Non-Executive Directors fulfills a pivotal role in corporate accountability.
Although all the Directors have an equal responsibility for the Group’s operations, the role of these
Independent Non-Executive Directors is particularly important as they provide unbiased and
independent views, advice and judgement to take account of the interests, not only of the Group, but
also of shareholders, employees, customers, suppliers and the many communities in which the Group
conducts business.
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S
TATEMENT ON CORPORATE GOVERNANCE
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
1.3 Board meetings
During the financial year ended 31 January 2005, three (3) Board meetings were held. Details of the
attendance of the Directors at the Board Meetings are disclosed in their respective personal profiles
set out as follows:Directors
No. of meetings attended
Tiang Ming Sing
3 out of 3
Tiang Ching Kok
3 out of 3
Datuk Hajjah Raziah @ Rodiah Binti Mahmud
3 out of 3
Edmund Goh Chze Jin
3 out of 3
Michael Ong Kee Tuan
3 out of 3
Alfed Ong Sze Lee
3 out of 3
Robin Lo Bing
3 out of 3
1.4 Supply of information
All Directors are provided with an agenda and a set of Board papers prior to Board meetings. This is
issued in sufficient time to enable the Directors to obtain further explanations, where necessary, in
order to be properly briefed before the meeting. The Board papers include, among others, the following:i. financial performance of the Group and of the Company;
ii. corporate and investment strategies and plans;
iii. other major operational and financial issues;
iv. minutes of the Management Committee meetings;
v. minutes of all other Sub-Committees meetings; and
vi. annual budgets.
In addition, there is a schedule of matters reserved specifically for the Board’s decision, including the
approval of corporate plans and annual budgets, acquisitions and disposals of undertakings and
properties of a substantial value, major investments and financial decisions, and changes to the
management and control structure within the Group, including key policies and procedures and
delegated authority limits.
Directors may obtain independent professional advice in the furtherance of their duties, at the
Company’s expense.
All Directors have access to the advice and services of the Company Secretary in carrying out their
duties.
>> 17
S
TATEMENT ON CORPORATE GOVERNANCE
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
2. The Board of Directors
The following Board Committees have been established to assist the Board in the execution of its
responsibilities.
a.
Audit Committee
The Audit Committee reviews issues of accounting policy and presentation for external financial
reporting, monitors the work of the internal audit function and ensures an objective and professional
relationship is maintained with the external auditors. The Committee has full access to the auditors
both internally and externally who, in turn, have access at all times to the Chairman of the Committee.
The Committee meets with the external auditors in the absence of management at the start of each
meeting except for the Company Secretary.
The report on the Audit Committee may be found on pages 12 to 15.
b.
ESOS Committee
The ESOS Committee was established to administer the Quality Concrete Holdings Berhad’s
Employees’ Share Option Scheme in accordance with the objectives and regulations thereof and to
determine participation eligibility, option offers and share allocations and to attend to such other matters
as may be required. The members of the Committee are Mr. Tiang Ming Sing, Mr. Tiang Ching Kok
and Mr. Edmund Goh Chze Jin.
Meetings of the ESOS Committee are held when necessary. During the financial year ended 31
January 2005, no meeting was held.
c.
Nomination Committee
The Nomination Committee, which was set up on 2 May 2003, is responsible for recommending board
appointments and assessment of directors on an on-going basis. The current members of the
Nomination Committee are Mr. Tiang Ming Sing, Mr. Michael Ong Kee Tuan and Mr. Robin Lo Bing.
During the financial year ended 31 January 2005, no meeting was held.
d.
Remuneration Committee
The Remuneration Committee, which was set up on 2 May 2003, is responsible for determining the
level and make up of Executive Directors’ remuneration for Quality Concrete Holdings Berhad and its
subsidiaries so as to ensure that the Group attracts and retains the Directors of the necessary caliber,
experience and quality needed to run the Group successfully. The Current members of the
Remuneration Committee are Mr. Tiang Ming Sing, Mr. Michael Ong Kee Tuan and Mr. Robin Lo Bing.
>> 18
S
TATEMENT ON CORPORATE GOVERNANCE
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
3. Re-election of the Directors
In accordance with the Company’s Articles of Association, all Directors who are appointed by the Board are
subject to election by shareholders at the first Annual General Meeting after their appointment.
In accordance with the Articles of Associations, at each Annual General Meeting one third of the Directors
for the time being or if their number is not three or a multiple of three, then the number nearest one-third,
shall retire from office. The Directors to retire in every year shall be those who have been longest in office
since their last election, but as between persons who become Directors on the same day those to retire
(unless they otherwise agree among themselves) shall be determined by lot. All Directors shall retire from
office once at least in each three (3) years, but shall be eligible for re-election.
4. Directors’ Remuneration
The details of remuneration of the Directors of the Company for the financial year ended 31 January 2005
are as follows:Category
Fees
RM’000
Emoluments
RM’000
Total Remuneration
RM’000
Executive Directors
10
758
768
Non-Executive Directors
19
8
27
Total
29
766
795
The number of Directors whose total remuneration falls within the following bands is as follows:Executive Directors
Non-Executive Directors
Below RM50,000
-
5
RM50,001 - RM100,000
-
-
RM100,001 - RM200,000
-
-
RM200,001 - RM250,000
-
-
RM250,001 - RM300,000
1
-
RM300,001 - RM350,000
1
-
RM350,001 - RM400,000
-
-
RM400,001 - RM450,000
1
-
>> 19
S
TATEMENT ON CORPORATE GOVERNANCE
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
5. Directors’ Training
All the Directors had completed the Mandatory Accreditation Programme (�MAP’) conducted by the Research
Institute of Investment Analysis Malaysia, an affiliate company of the Bursa Malaysia Securities Berhad
(�BMSB’). In addition, they have also attended seminars and Mandatory Continuing Programmes (�CEP’)
as prescribed by BMSB which include corporate practices and governance for Company Directors, updates
on regulatory issues, risk management, Directors remunerations and investors information, Audit Committees’
unique competency requirements and understanding and minimising the risk of accounting manipulations.
A register has been maintained to record the number of CEP hours accumulated by each Director. The
Company will see to it that the Directors continue to attend other relevant training programmes to enhance
their knowledge from time to time.
6. Investor Relations and Shareholder Communication
The Board acknowledges the need for shareholders to be informed of all material business matters affecting
the Company. In addition to various announcements made during the year, the timely release of financial
results on a quarterly basis provides shareholders with an overview of the Group’s performance and
operations.
The Company has been using the Annual General Meeting, usually held in July each year, as a means of
communicating with shareholders. Shareholders who are unable to attend are allowed to appoint proxies to
attend and vote on their behalf. Members of the Board as well as the Auditors of the Company are present
to answer questions raised at the meeting.
Any queries or concerns regarding the Quality Concrete Group may be conveyed to the following persons:i.
Mr. Michael Ong Kee Tuan, Independent Non-Executive Director
Telephone number : 6082-338123
Facsimile number
: 6082-336784
ii. Mr. Tiang Ching Kok, Managing Director
Telephone number : 6082-206608
Facsimile number
: 6082-206607
iii. Mr. Edmund Goh Chze Jin, Executive Director
Telephone number : 6082-206603
Facsimile number
: 6082-206607
7. Financial Reporting
In presenting the annual financial statements and quarterly announcement of results to shareholders, the
Directors aim to present a balanced and understandable assessment of the Group’s position and prospects.
The Directors consider that in preparing the financial statements, the Group has used appropriate accounting
policies, consistently applied and supported by reasonable and prudent judgments and estimates. All
accounting standards which the Board considers to be applicable have been followed, subject to any
explanations and material departures disclosed in the notes to the financial statements.
>> 20
S
TATEMENT ON CORPORATE GOVERNANCE
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
8. Internal Control
The Directors acknowledge their responsibility for the Group’s system of internal controls, which is designed
to identify and manage the risks facing the businesses in pursuit of its objectives. The system of internal
control covers management and financial risks, organisational, operational and compliance controls to
safeguard shareholders’ investments and the Group’s assets. This system, by its nature, can only provide
reasonable and not absolute assurance against misstatement or loss.
The key elements of the Group’s internal control system are described below:•
Clearly defined delegation of responsibilities to Committees of the Board and the management of
Group Head Office and operating units, including authorisation levels for all aspects of the businesses.
Each operating unit has clear accountabilities for ensuring that appropriate risk management and
control procedures are in place. These delegations are subject to periodic review throughout the year
as to their implementation and for their continuing suitability.
•
Clearly documented internal procedures set out in the Operating Manuals and the Group Procedures
and Authorities.
•
Regular internal audit visits to monitor compliance with procedures and assess the integrity of financial
information provided.
•
Regular and comprehensive information provided to management, covering financial performance
and key business indicators, such as staff utilisation and cash flow performance.
•
A detailed budgeting process where operating units prepare budgets for the coming year which are
approved both at the operating units level and by the Board.
•
Monitoring of results against budget, with major variances being followed up and management action
taken, where necessary.
•
Visits to operating units by members of the Board and senior management.
The Board undertakes ongoing reviews of the key operational and financial risks facing the Group’s
businesses together with those areas relating to compliance with laws and regulations. The monitoring
arrangements in place give reasonable assurance that the structure of controls and operation is appropriate
to the Company’s and the Group’s situation and that there is an acceptable level of risk throughout the
Group’s businesses.
9. Relationship with the Auditors
The Audit Committee and the Board have established formal and transparent arrangements with the
Company’s external auditors to maintain appropriate relationship. The role of Audit Committee in relation to
the external auditors is stated on pages 12 to 15. The external auditors will from time to time highlight to the
Audit Committee and Board of Directors on matters that require the Board’s attention.
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TATEMENT ON CORPORATE GOVERNANCE
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
10. Additional Compliance Information
The following information is presented in compliance with the BMSB Listing requirements:
10.1 Share buybacks
During the financial year, the Company did not enter into any share buybacks transactions.
10.2 Options, warrants or convertible securities
The Company has not issued any options, warrants or convertible securities during the financial year,
other than the granting/exercise of options under the Employees’ Share Option Scheme as disclosed
in the Directors’ Report.
10.3 American Depository Receipt (�ADR’) or Global Depository Receipt (�GDR’) programme
During the year, the Company did not sponsor any ADR or GDR programme.
10.4 Imposition of sanctions and penalties
There were no sanctions or penalties imposed on the Company and its subsidiaries, directors or
management by the relevant regulatory bodies during the financial year.
10.5 Non-audit fee
The amount of non-audit fees paid to the external auditors by the Group and by the Company for the
year amounted to RM53,000.
10.6 Profit guarantee
During the financial year, there was no profit guarantee given by the Company.
10.7 Material contracts
None of the Directors and/or Major Shareholders had any material contract with the Company and/or
its subsidiaries during the financial year ended 31 January 2005.
>> 22
S
TATEMENT ON DIRECTORS’ RESPONSIBILITY
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
The Directors are required by the Companies Act, 1965 (�the Act’)
to prepare financial statements for each financial year which give
a true and fair view of the state of affairs of the Group and the
Company at the end of the financial year and the profit or loss of
the Group and the Company for the financial year. As required by
the Act and the Listing Requirements of Bursa Malaysia Securities,
the financial statements have been prepared in accordance with
the applicable MASB Approved Accounting Standards in Malaysia
and the provision of the Act.
The Directors consider that in preparing the financial statements
for the year ended 31 January 2005 set out on pages 30 to 79, the
Group has used appropriate accounting policies, consistently
applied and supported by reasonable and prudent judgements and
estimates. The Directors have responsibility for ensuring that the
Group and the Company keep accounting records which disclose
with reasonable accuracy the financial position of the Group and
the Company which enable them to ensure that the financial
statements comply with the Act. The Directors have general
responsibility for taking such steps as are reasonably available to
them to safeguard the assets of the Group and to prevent and
detect fraud and other irregularities.
>> 23
S
TATEMENT ON INTERNAL CONTROL
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
STATEMENT ON INTERNAL CONTROL
Pursuant to paragraph 15.27(b) of the Bursa Malaysia Securities’ Revamped Listing Requirements
The Board of Directors of Quality Concrete Holdings Berhad (�Board’) is pleased to provide the following statement
on the extent of compliance with the Principles and Best Practices of good corporate governance as set out in
the Malaysian Code of Corporate Governance by the Group.
Board Responsibility
The Board acknowledges the importance of having an effective internal control system and a well structured
risk management framework to safeguard the interest of shareholders, customers, employees and as well as
the Group’s assets. The Board understands its overall responsibility for establishing an efficient and effective
system of internal control covering not only financial controls but also relating to operational, compliance and
risk management and for reviewing the adequacy and integrity of the system. However, due to the limitations
that are inherent in any system of internal control, those systems are designed to manage rather than eliminate
the risk of failure to achieve business objectives, and can only provide reasonable and not absolute assurance
against material misstatement or loss.
The Board has established an ongoing process for identifying, evaluating and managing the principal risks
faced, or potentially exposed to, by the Group in pursuing its business objectives. The process is being continually
monitored and reviewed for its adequacy and effectiveness to ensure it is in accordance with the Internal
Control Guidance.
Risk Management Framework
The Board and management are proactive in identifying significant risks associated with its business processes.
The Risk Management Committee was established in April 2004 to coordinate the implementation of an enterprisewide risk management programme for the Group. The Committee comprises two (2) representatives from the
Board, the management representatives from the respective subsidiaries and also the Internal Auditor. Monthly
management meetings were held with the respective risk owners and their management teams to identify and
evaluate any new emerging risks, update the business risk profiles and put in place the appropriate risk response
strategies and controls to manage and maintain those risks at a level acceptable to the Board.
Internal Audit Function
The Board acknowledges the importance of internal audit function and has in place an internal audit unit which
reports directly to the Audit Committee on a quarterly basis. The Group has also appointed an independent
professional audit firm to further strengthen and to provide additional assurance regarding the effectiveness as
well as the adequacy and integrity of the Group’s internal control system.
The internal audit function adopts a risk-based approach in developing its audit strategy and plan which focuses
on identifying principal risks affecting the achievement of the Group’s business objectives, assessing the likelihood
and impact of these risks, evaluating the effectiveness of the existing controls in place and formulating action
plans to improve the internal control system. Scheduled internal audit visits are carried out by the internal audit
unit together with the independent professional audit team based on the audit plan presented to and approved
by the Audit Committee. On a quarterly basis, the internal auditors report to the Audit Committee on areas for
improvement and will subsequently follow up to ensure that corrective actions on reported weaknesses are
remedied within the required time frame by the Management of the respective subsidiaries.
>> 24
S
TATEMENT ON INTERNAL CONTROL
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
Key Elements of Internal Control
The Group has also put in place the following key elements of internal control:
•
An organisational structure with well defined scope of responsibilities, accountabilities and appropriate
level of delegated authorities;
•
A process of hierarchical reporting which provides for a documented and auditable trail of accountability;
•
Regular and comprehensive information provided to management covering both financial and operational
performance and key business indicators, for effective monitoring and decision making;
•
Regular visits to operating units and close involvement in daily operations of the Group by Executive
Directors and senior management;
•
Regular Board and Audit Committee meetings are held to identify and resolve operational and financial
issues;
•
The Audit Committee reviews and holds meetings with management on the proposed action to be
taken on significant internal control issues identified by internal and external auditors.
Board Review
The Board is of the view that based on the internal auditors’ report, there is a reasonable assurance that the
Group’s internal control system is in place and operating as designed. A number of minor internal control
weaknesses were identified during the year, all of which have been, or are being addressed. None of the
weaknesses have resulted in any material losses, contingencies or uncertainties that would require disclosure
in the Group’s annual report.
The Board is continuosly reviewing and implementing measures to strengthen the internal control system of the
Group.
This statement has been reviewed by the external auditors in compliance with Paragraph 15.24 of Bursa Malaysia
Securities’ Revamped Listing Requirements.
This statement is issued in accordance with a resolution of the Directors dated 5 May 2005.
>> 25
E
XECUTIVE CHAIRMAN’S STATEMENT
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
OPERATIONAL REVIEW
In general, 2004 had been a challenging year for the
Group. The economic and market conditions commencing
from the middle of last year were rather inflationary with
the escalation of crude oil price which resulted in
significantly higher cost of raw materials such as
polypropylene (�PP’) resins and polyethylene (�PE’) resins
by 40% and 50% respectively.
Polyflow Pipes Sdn. Bhd. (�PPSB’) which produces PE
pipes was able to a certain extent, counter the PE resins
cost escalation through advanced purchases from its
suppliers. Furthermore, PPSB, through its marketing
efforts succeeded in securing increased sales volume
from the public sector. PPSB recorded a PBT of RM8.5
million for the financial year ended 31 January 2005.
CHAIRMAN’S STATEMENT
On behalf of the Board of Directors of
Quality Concrete Holdings Berhad, I am
pleased to present the Annual Report and
Audited Financial Statements of the Group
for the financial year ended 31 January
2005.
FINANCIAL RESULTS
For the financial year under review, the Group
recorded a total revenue of RM156.2 million, which
is a decrease of 3.1% from RM161.2 million
recorded in the previous financial year. The
decrease was mainly due to lower revenue
recorded by Quality Concrete Sdn. Bhd (�QCSB’),
Kutex Sdn. Bhd. (�Kutex’) and Hong Wei Holdings
Sdn. Bhd. (�Hong Wei’)
The Profit Before Tax (�PBT’) of the Group
decreased from RM15.6 million in the previous
financial year to RM6.6 million for the financial year
ended 31 January 2005. This was due to the drop
in revenue mentioned above coupled with the
escalation of cost of raw materials arising from the
high cost of fuel during the year, investment losses
and general increase in operational cost.
The decrease in PBT resulted in a drop in Earnings
Per Share from 21.6 sen to 7.4 sen. However, the
Group’s fundamentals remain strong as
Shareholders’ Funds increased from RM128.4
million to RM133.4 million with Net Tangible Asset
Per Share increasing from RM2.2 to RM2.3.
>> 26
Kutex, on the other hand, had not been able to make
advanced purchases on more favourable terms because
of its smaller requirement for raw material. Although there
were strong competitions from other Malaysian and
overseas producers of PP bags, Kutex through its
marketing efforts was able to secure clients from major
customers to end the financial year on a positive note,
albeit at a lower PBT of approximately RM0.35 million
compared to that of the preceding year.
E
XECUTIVE CHAIRMAN’S STATEMENT
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
QCSB recorded a PBT of approximately RM1.5 million
for the financial year ended 31 January 2005, a drop
of 4% from the preceding financial year. The decline
in PBT was mainly due to reduced sales volume in a
very competitive market and higher cost of operation
in later part of the year arising from higher cost of
fuel, sand and aggregates.
On the other hand, Lee Ling Timber Products Sdn.
Bhd. (�LLTP’) recorded a loss of approximately RM1.4
million for the financial year ended 31 January 2005.
The losses were attributed mainly to the trading of
imported sawn timber which encountered substantial
reduction in prices offered by its customers towards
the second half of the year. The increase in local logs
prices in the year also contributed to higher cost of
production.
STRATEGIES AND PROSPECTS FOR THE NEW
FINANCIAL YEAR
In the new financial year, the Group will concentrate
on its core business areas focusing on the following
fundamental strategies:-
• Diversify Hong Wei’s commercial and housing
development activities to cover the main growth
centres in Sarawak through development of its
existing land bank and new acquisition of land in
high growth areas or by entering into projectsharing basis with landowners; and
• To intensify sales of ready-mixed concrete and precast concrete piles to the residential and
commercial developers in view of the growth in the
private construction sector especially in the major
towns of Sarawak while aiming to enhance its
market dominance in the supply to projects in the
public sector. Internally, emphasis will be placed
on increasing production efficiency and maintaining
high product quality.
In addition to the above strategies, the Group will also
explore other businesses and investment opportunities
both locally and overseas in order to enhance and
diversify the Group’s revenue base. The Group is
expected to continue to be profitable for the financial
year ending 31 January 2006.
• Increase market share and expand the product
range of PPSB and identify investment opportunity
in areas outside of Sarawak such as the joint
venture for production of PE pipes in Burnei
Darulssalam;
• Increase production and sales of sawn timber and
woodworking products and to widen overseas
markets for LLTP products especially those which
are granted pioneer status incentive;
>> 27
E
XECUTIVE CHAIRMAN’S STATEMENT
Quality Concrete Holdings Berhad (378282-D)
Incorporated In Malaysia
ACKNOWLEDGEMENT
On behalf of the Board of Directors, I wish to express
our sincere appreciation to the management and staff
of the Group for their dedication, hard work,
commitment and contributions to the growth of the
Group. I also wish to convey our appreciation to our
customers, suppliers, business associates, bankers,
relevant government authorities and shareholders for
their continued support.
TIANG MING SING
EXECUTIVE CHAIRMAN
>> 28
Financial
Statements
Quality Concrete Holdings Berhad (378282-D)
>> Incorporated In Malaysia
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Directors' Report
The directors have pleasure in presenting their report together with the audited financial statements of the Group and of the Company
for the financial year ended 31 January 2005.
Principal activities
The principal activities of the Company are investment holding and the provision of management services. The principal activities of the
subsidiaries are set out in Note 12 to the financial statements.
There have been no significant changes in the nature of the principal activities during the financial year.
Results
Net profit for the year
Group
RM’000
Company
RM’000
4,295
====
1,637
====
There were no material transfers to or from reserves or provisions during the financial year other than as disclosed in the Statements of
Changes in Equity.
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
The names of the directors of the Company in office since the date of the last report and at the date of this report are:
Tiang Ming Sing
Tiang Ching Kok
Edmund Goh Chze Jin
Datuk Hajjah Raziah @ Rodiah Binti Mahmud
Robin Lo Bing
Michael Ong Kee Tuan (Appointed on 8 May 2004)
Alfed Ong Sze Lee
Directors’ benefits
Neither at the end of the financial year, nor at any time during that year, did there subsist any arrangement to which the Company was
a party, whereby the directors might acquire benefits by means of the acquisition of shares in or debentures of the Company or any
other body corporate, other than the options over shares granted by the Company to Eligible Employees, including Executive Directors
of the Company, pursuant to the Company’s Employees’ Share Option Scheme.
Since the end of the previous financial year, no director has received or become entitled to receive a benefit (other than benefits
included in the aggregate amount of emoluments received or due and receivable by the directors as shown in Note 7 to the financial
statements or the fixed salary of a full-time employee of the Company) by reason of a contract made by the Company or a related
corporation 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,
except as disclosed in Note 31 to the financial statements.
>> 30
Directors' Report (contd.)
Directors’ interests
According to the register of directors’ shareholdings, the interests of directors in office at the end of the financial year in shares and
options of the Company during the financial year were as follows:
Number of Ordinary Shares of RM1 Each
1 February
2004
Bought
Sold
31 January
2005
8,915,000
-
(2,000,000)
6,915,000
1,179,000
272,405
-
-
1,179,000
272,405
9,726,000
18,641,000
2,000,000
-
-
11,726,000
18,641,000
Direct Interest:
Tiang Ming Sing
Datuk Hajjah Raziah @ Rodiah
Binti Mahmud
Robin Lo Bing
Indirect Interest:
Tiang Ming Sing
Tiang Ching Kok
Exercise
price
RM
Tiang Ming Sing
Tiang Ching Kok
1.38
1.59
Number of Options over Ordinary Shares of RM1 Each
1 February 2004 and 31 January 2005
400,000
200,000
By virtue of their interests in shares of the Company and Section 6A of the Companies Act 1965, Tiang Ming Sing and Tiang Ching Kok
are also deemed interested in the shares of the subsidiaries to the extent that the Company has an interest.
None of the other directors in office at the end of the financial year had any interest in shares and options in the Company or its related
corporations during the financial year.
Share capital
During the current financial year, the issued and paid-up share capital of the Company was increased from 57,413,000 to 57,953,000 by
the issuance of 540,000 new ordinary shares of RM1 each on conversion of 499,000, 21,000 and 20,000 options at the option prices of
RM1.38, RM1.53 and RM1.59 each, respectively. All the new ordinary shares that were issued rank pari passu in all respects with the
existing shares of the Company. The share premium arising from the issue amounted to RM213,000.
Employees’ Share Option Scheme
Pursuant to the Company’s Employees’ Share Option Scheme (�ESOS’) which came into effect on 30 November 2001, 3,993,000
options were offered to Eligible Employees and Executive Directors of the Company and its subsidiaries at the offer price of RM1.38 per
share.
A second offer of 562,000 options was approved under the ESOS and offered to new Eligible Employees and Executive Directors of the
Company and its subsidiaries on 22 January 2003 at the offer price of RM1.53 per share.
>> 31
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Directors' Report (contd.)
Employees’ Share Option Scheme (contd.)
A third offer of 400,000 options was approved under the ESOS and offered to new Eligible Employees and Executive Directors of the
Company and its subsidiaries on 8 July 2003 at the offer price of RM1.59 per share.
The main features of the ESOS are:
(a) Eligible Employees are full time employees and Executive Directors of the Company or of eligible subsidiaries who have been
confirmed in the employment of the Group and have served for a continuous period for at least one year before the date of the offer.
(b) The total number of new shares to be offered and allotted under the ESOS shall not exceed 10% of the issued and paid-up share
capital of the Company at any point in time during the duration of the ESOS.
(c) The option period is for five years from the date of the implementation of the ESOS, 30 November 2001.
(d) The option price at which the Eligible Employees are entitled to exercise the options shall be the higher of a discount of not more
than ten (10) percent on the average of the mean market quotation of the shares as shown in the daily official list issued by Bursa
Malaysia Securities Berhad for five (5) trading days immediately preceding the date of offer, or the par value of the shares.
(e) The options granted may be exercised at any time within the option period and the basis on which the options may be exercised are
as follows:
Options Granted
Below 10,000
10,000 to less than 50,000
50,000 and above
Maximum Percentage of Options Exercisable in Each Year
commencing from the Date of Offer
Year 1
Year 2
Year 3
Year 4
Year 5
%
%
%
%
%
33.3*
25
20
33.3*
25
20
33.3*
25
20
25
20
20
* rounded to the nearest 1,000 shares
(f) No employees shall participate at any time in more than one ESOS implemented by the Company within the Group.
(g) The Eligible Employees of the Group who are entitled to participate in the ESOS shall be those who fall within any of the categories
listed hereunder. The minimum amount of shares in the Company that may be offered and allocated to an Eligible Employee shall
not be less than 1,000 new ordinary shares nor exceed the Maximum Entitlement as set out opposite their respective categories
listed as follows:
Categories of Employees
Group Executive Director
Subsidiaries’ Executive Director
Management I
Management II
Management III
Management IV
Executive I
Executive II
>> 32
Grade
Maximum Entitlement
Number of Options (’000)
1
2
3
4
5
6
7
8
500
400
250
150
90
55
35
22
Directors' Report (contd.)
Employees’ Share Option Scheme (contd.)
Categories of Employees
Executive III
Executive IV
Non-Executive I
Non-Executive II
Non-Executive III
Grade
Maximum Entitlement
Number of Options (’000)
9
10
11
12
13
10
10
7
5
4
The status of the scheme as at 31 January 2005 was as follows:
A.
B.
C.
D.
E.
F.
G.
H.
I.
J.
K.
L.
M.
N.
O.
Total options approved for ESOS on 1 November 2000
Total options offered on 30 November 2001
Total options forfeited on 1 February 2001 to 31 January 2002
Total options available for exercise on 1 February 2002 [B-C]
Total options exercised on 1 February 2002 to 31 January 2003
Total options forfeited on 1 February 2002 to 31 January 2003
Total options offered on 22 January 2003
Balance of options available for exercise as at the close of business
on 31 January 2003 [D-(E+F)+G]
Total options offered on 8 July 2003
Total options exercised on 1 February 2003 to 31 January 2004
Total options forfeited on 1 February 2003 to 31 January 2004
Balance of options available for exercise at the close of business
on 31 January 2004 [(H+I)-(J+K)]
Total options exercised on 1 February 2004 to 31 January 2005
Total options forfeited on 1 February 2004 to 31 January 2005
Balance of options available for exercise at the close of business
on 31 January 2005 [L-(M+N)]
5,222,000
3,993,000
9,000
3,984,000
379,000
255,000
562,000
3,912,000
400,000
234,000
492,000
3,586,000
540,000
169,000
2,877,000
The outstanding options to take up unissued ordinary shares of RM1 each and the option prices are as follows:
Options over Ordinary Shares of RM1 Each
Date of offer
30 November 2001
22 January 2003
8 July 2003
Option price
RM
1.38
1.53
1.59
1 February
2004
2,661,000
525,000
400,000
––––––––
3,586,000
========
Forfeited
(147,000)
(22,000)
–––––––
(169,000)
=======
Exercised
(499,000)
(21,000)
(20,000)
–––––––
(540,000)
=======
31 January
2005
2,015,000
482,000
380,000
––––––––
2,877,000
========
The Company has been granted exemption by the Companies Commission of Malaysia from having to disclose the list of option holders
and their holdings.
Other statutory information
(a) Before the income statements and balance sheets of the Group and of the Company were made out, the directors took reasonable
steps:
>> 33
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Directors' Report (contd.)
Other statutory information (contd.)
(i) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of provision for doubtful
debts and satisfied themselves that there were no known bad debts and that adequate provision had been made for doubtful
debts; and
(ii) to ensure that any current assets which were unlikely to realise their value as shown in the accounting records in the ordinary
course of business had been written down to an amount which they might be expected so to realise.
(b) At the date of this report, the directors are not aware of any circumstances which would render:
(i) it necessary to write off any bad debts or the amount of the provision for doubtful debts in the financial statements of the Group
and of the Company inadequate to any substantial extent; and
(ii) the values attributed to the current assets in the financial statements of the Group and of the Company misleading.
(c) At the date of this report, the directors are not aware of any circumstances which have arisen which would render adherence to the
existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate.
(d) At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this report or financial
statements of the Group and of the Company which would render any amount stated in the financial statements misleading.
(e) As at the date of this report, there does not exist:
(i) any charge on the assets of the Group or of the Company which has arisen since the end of the financial year which secures
the liabilities of any other person; or
(ii) any contingent liability of the Group or of the Company which has arisen since the end of the financial year.
(f)
In the opinion of the directors:
(i) no contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve months
after the end of the financial year which will or may affect the ability of the Group or of the Company to meet their obligations
when they fall due; and
(ii) no item, transaction or event of a material and unusual nature has arisen in the interval between the end of the financial year
and the date of this report which is likely to affect substantially the results of the operations of the Group or of the Company for
the financial year in which this report is made.
Auditors
The auditors, Ernst & Young, have expressed their willingness to continue in office.
Signed on behalf of the Board in accordance with a resolution of the directors
Tiang Ching Kok
Kuching, Malaysia
Date: 5 May 2005
>> 34
Edmund Goh Chze Jin
Statement by Directors pursuant to Section 169(15) of the
Companies Act, 1965
We, Tiang Ching Kok and Edmund Goh Chze Jin, being two of the directors of Quality Concrete Holdings Berhad, do hereby state
that, in the opinion of the directors, the accompanying financial statements set out on pages 37 to 79 are drawn up in accordance with
applicable MASB Approved Accounting Standards in Malaysia and the provisions of the Companies Act, 1965 so as to give a true and
fair view of the financial position of the Group and of the Company as at 31 January 2005 and of the results and the cash flows of the
Group and of the Company for the year then ended.
Signed on behalf of the Board in accordance with a resolution of the directors
Tiang Ching Kok
Edmund Goh Chze Jin
Kuching, Malaysia
Date: 5 May 2005
Statutor y Declaration pursuant to Section 169(16) of the
Companies Act, 1965
I, Edmund Goh Chze Jin, being the Director primarily responsible for the financial management of Quality Concrete Holdings
Berhad, do solemnly and sincerely declare that the accompanying financial statements set out on pages 37 to 79 are in my opinion
correct, and I 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 abovenamed Edmund Goh Chze Jin
at Kuching in the State of Sarawak
on 5 May 2005
Edmund Goh Chze Jin
Before me,
>> 35
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Report of the Auditors to the Members of
Quality Concrete Holdings Berhad
We have audited the financial statements set out on pages 37 to 79. These financial statements are the responsibility of the Company’s
directors.
It is our responsibility to form an independent opinion, based on our audit, on the financial statements and to report our opinion to you,
as a body, in accordance with Section 174 of the Companies Act, 1965 and for no other purpose. We do not assume responsibility to any
other person for the content of this report.
We have conducted our audit in accordance with applicable Approved Standards on Auditing in Malaysia. Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by the directors, as well as evaluating the overall
presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
In our opinion:
(a)
(b)
the financial statements have been properly drawn up in accordance with the provisions of the Companies Act, 1965 and applicable
MASB Approved Accounting Standards in Malaysia so as to give a true and fair view of:
(i)
the financial position of the Group and of the Company as at 31 January 2005 and of the results and the cash flows of the
Group and of the Company for the year then ended; and
(ii)
the matters required by Section 169 of the Companies Act, 1965 to be dealt with in the financial statements; and
the accounting and other records and the registers required by the Act to be kept by the Company and by its subsidiaries of which
we have acted as auditors have been properly kept in accordance with the provisions of the Act.
We are satisfied that the financial statements of the subsidiaries that have been consolidated with the Company’s financial statements
are in form and content appropriate and proper for the purposes of the preparation of the consolidated financial statements and we have
received satisfactory information and explanations required by us for those purposes.
The auditors' reports on the financial statements of the subsidiaries were not subject to any qualification and did not include any
comment required to be made under Section 174(3) of the Act.
ERNST & YOUNG
AF: 0039
Chartered Accountants
Kuching, Malaysia
Date: 5 May 2005
>> 36
YONG VOON KAR
1769/04/06 (J/PH)
Partner
Income Statements
for the year ended 31 January 2005
Group
Revenue
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
3
156,158
161,237
7,663
7,139
(131,161)
–––––––
24,997
(128,192)
–––––––
33,045
––––––
7,663
––––––
7,139
4,263
(9,649)
(4,823)
(6,102)
–––––––
8,686
2,953
(8,631)
(4,462)
(5,395)
–––––––
17,510
276
(1,704)
(2,591)
––––––
3,644
777
(1,282)
(944)
––––––
5,690
(2,136)
–––––––
6,550
(1,925)
–––––––
15,585
(549)
––––––
3,095
(409)
––––––
5,281
(2,135)
–––––––
4,415
(3,279)
–––––––
12,306
(1,458)
––––––
1,637
(1,645)
––––––
3,636
(120)
–––––––
4,295
======
29
–––––––
12,335
======
––––––
1,637
=====
––––––
3,636
=====
7.43
7.20
=====
21.55
20.87
=====
Cost of sales
Gross profit
Other operating income
Selling and distribution expenses
Administrative expenses
Other operating expenses
Profit from operations
Finance costs
4
Profit before taxation
5
Taxation
8
Profit after taxation
Minority interest
Net profit for the year
Earnings per share (sen)
- Basic
- Diluted
Company
Note
9
The accompanying notes form an integral part of the financial statements.
>> 37
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Balance Sheets
as at 31 January 2005
Group
Non-current assets
Property, plant and equipment
Land held for property development
Investment in subsidiaries
Other investments
Goodwill on consolidation
Current assets
Inventories
Property development costs
Trade receivables
Other receivables
Amount due from subsidiaries
Fixed deposits with a licensed bank
Cash and bank balances
Current liabilities
Borrowings
Trade payables
Other payables
Amount due to subsidiaries
Tax payable
Company
Note
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
10
11(a)
12
13
14
61,400
6,450
8,668
1,028
64,631
3,409
9,813
1,085
6,935
70,903
8,668
-
7,206
70,903
9,813
-
15
11(b)
16
17
18
19
27,553
10,404
53,596
19,335
300
4,902
–––––––
116,090
29,920
10,211
55,038
20,392
300
5,210
–––––––
121,071
2,137
19,914
–––––––
22,051
1,718
17,339
–––––––
19,057
20
21
22
18
31,692
9,597
10,794
461
–––––––
52,544
34,951
13,740
11,313
–––––––
60,004
1,280
3,818
4,119
–––––––
9,217
1,207
2,957
5,815
–––––––
9,979
63,546
–––––––
141,092
=======
61,067
–––––––
140,005
=======
12,834
–––––––
99,340
=======
9,078
–––––––
97,000
=======
57,953
75,496
–––––––
133,449
57,413
70,988
–––––––
128,401
57,953
41,341
–––––––
99,294
57,413
39,491
–––––––
96,904
-
(120)
-
-
1,333
6,310
3,189
8,535
46
-
96
-
7,643
–––––––
141,092
=======
11,724
–––––––
140,005
=======
46
–––––––
99,340
=======
96
–––––––
97,000
=======
Net current assets
Financed by:
Share capital
Reserves
24
25
Shareholders’ equity
Minority interest
Non-current liabilities
Borrowings
Deferred tax liabilities
20
26
The accompanying notes form an integral part of the financial statements.
>> 38
Statement of Changes in Equity
for the year ended 31 January 2005
Share
capital
RM’000
Non-distributable в†’
в†’
Share Revaluation
Capital
Distributable
Retained
profit
RM’000
premium
RM’000
reserve
RM’000
reserve
RM’000
57,179
24,784
8,378
846
24,652
115,839
Transfers within reserves
on realisation
-
-
(1,333)
-
1,333
-
Net profit for the year
-
-
-
-
12,335
12,335
234
89
-
-
-
323
––––––
57,413
(96)
––––––
24,777
––––––
7,045
––––––
846
––––––
38,320
(96)
–––––––
128,401
Transfers within reserves
on realisation
-
-
(1,248)
-
1,248
-
Net profit for the year
-
-
-
-
4,295
4,295
540
––––––
57,953
=====
213
––––––
24,990
=====
––––––
5,797
=====
––––––
846
=====
––––––
43,863
=====
753
–––––––
133,449
======
Note
Total
RM’000
Group
At 1 February 2003
Issue of shares
24
Share issue expenses
written-off
At 31 January 2004
Issue of shares
At 31 January 2005
24
The accompanying notes form an integral part of the financial statements
>> 39
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Statement of Changes in Equity
for the year ended 31 January 2005 (contd.)
Note
Share
capital
RM’000
Nondistributable
Share
premium
RM’000
Distributable
Retained
profit
RM’000
Total
RM’000
57,179
24,784
11,078
93,041
-
-
3,636
3,636
234
89
-
323
––––––
57,413
(96)
––––––
24,777
––––––
14,714
(96)
––––––
96,904
Company
At 1 February 2003
Net profit for the year
Issue of shares
24
Share issue expenses
written-off
At 31 January 2004
Net profit for the year
Issue of shares
At 31 January 2005
24
-
-
1,637
1,637
540
––––––
213
––––––
––––––
753
––––––
57,953
======
24,990
======
16,351
======
99,294
======
The accompanying notes form an integral part of the financial statements.
>> 40
Cash Flow Statements
for the year ended 31 January 2005
Group
Note
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
6,550
15,585
3,095
5,281
57
4,892
(281)
57
5,058
(183)
291
(6,431)
297
(6,233)
(1,566)
49
-
9
(1,548)
(343)
1,976
3,826
13
17
(37)
1,772
(792)
17
(1,548)
459
3,826
2
329
(537)
14
983
2,286
-
609
(54)
––––––
––––––
––––––
––––––
14,522
23,812
(306)
(231)
40
2,408
400
(4,662)
––––––
12,708
2,717
(3,908)
(8,198)
3,311
––––––
17,734
(76)
861
(4,271)
––––––
(3,792)
215
416
(4,277)
––––––
(3,877)
(2,208)
(4,905)
––––––
(2,028)
(2,789)
––––––
(459)
––––––
(329)
211
––––––
5,595
––––––
12,917
––––––
(4,251)
––––––
(3,995)
––––––
Cash flows from operating activities
Profit before taxation
Adjustments for:
Amortisation of goodwill
Depreciation
Gross dividend income
(Gain)/loss on disposal of property, plant
and equipment
Impairment in value of investments net of
amount written-back
Interest income
Interest expense
Loss/(gain) on disposal of other investments
Loss on disposal of property held for resale
Property, plant and equipment written-off
Provision for doubtful debts net of provision
no longer required
Provision for slow moving inventories
no longer required
Operating profit/(loss) before working
capital changes
Decrease in property development costs
Decrease/(increase) in inventories
Decrease/(increase) in receivables
(Decrease)/increase in payables
Increase in amount due from subsidiaries
Cash generated from/(used in) operations
Interest paid
Taxation paid, net of refund
Net cash generated from/(used in) operating
activities
>> 41
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Cash Flow Statements
for the year ended 31 January 2005 (contd.)
Group
Note
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
(12,129)
10,996
(1,982)
(3,535)
3,419
(5,378)
(12,129)
10,996
(22)
(3,535)
3,144
(73)
2,030
178
-
100
(842)
202
334
––––––
(3,409)
132
37
––––––
4,630
––––––
4,488
––––––
(1,391)
––––––
(8,556)
––––––
3,475
––––––
4,124
––––––
753
(771)
(1,686)
323
(96)
(1,084)
1,724
(1,363)
753
(50)
-
323
(96)
(4)
-
(1,759)
––––––
1,698
––––––
––––––
––––––
(3,463)
––––––
1,202
––––––
703
––––––
223
––––––
741
5,563
(73)
352
(2,708)
––––––
(8,271)
––––––
(1,157)
––––––
(1,509)
––––––
(1,967)
=====
(2,708)
=====
(1,230)
=====
(1,157)
=====
Cash flows from investing activities
Purchases of other investments
Proceeds from disposal of other investments
Acquisition of property, plant and equipment
Proceeds from disposal of property, plant
and equipment
Development expenditure incurred on land
held for development
Dividend received
Interest received
Net cash (used in)/generated from
investing activities
Cash flows from financing activities
Proceeds from issuance of shares
Share issue expenses written-off
Repayment of hire purchase payables
Drawdown of term loans
Repayment of term loans
Net (repayment of)/proceeds from bankers’
acceptances and revolving credit
Net cash (used in)/generated from financing
activities
Net increase/(decrease) in cash and
cash equivalents
Cash and cash equivalents at the
beginning of the year
Cash and cash equivalents at the
end of the year
>> 42
27
Notes to the Financial Statements - 31 January 2005
1. Corporate information
The principal activities of the Company are investment holding and the provision of management services. The principal activities of
the subsidiaries are set out in Note 12 to the financial statements. There have been no significant changes in the nature of the
principal activities during the financial year.
The Company is a public limited liability company, incorporated and domiciled in Malaysia and is listed on the Second Board of
Bursa Malaysia Securities Berhad. The registered office of the Company is located at Room 209, 2nd Floor, Wisma Bukit Mata
Kuching, Jalan Tunku Abdul Rahman, 93100 Kuching.
The financial statements of the Group and the Company are expressed in Ringgit Malaysia.
The financial statements were authorised for issue by the Board of Directors in accordance with a resolution of the directors on 5
May 2005 .
2. Significant accounting policies
2.1
Basis of preparation
The financial statements of the Group and of the Company have been prepared under the historical cost convention,
modified to include the revaluation of certain landed properties and unless otherwise indicated in the significant accounting
policies, comply with the provisions of the Companies Act, 1965 and applicable MASB Approved Accounting Standards in
Malaysia.
During the financial year ended 31 January 2005, the Group adopted the following MASB Standard for the first time:
MASB 32
Property Development Activities
The adoption of MASB 32 has not given rise to any adjustments to the opening balances of retained profit of the prior and
current year or to changes in comparatives.
2.2
Basis of consolidation
The consolidated financial statements include the financial statements of the Company and all its subsidiaries. Subsidiaries
are those entities in which the Group has power to exercise control over the financial and operating policies so as to obtain
benefits from their activities.
Where the subsidiaries are consolidated using the acquisition method of accounting, the results of subsidiaries acquired or
disposed off during the financial year are included in the consolidated income statement from the effective date of acquisition
or up to the effective date of disposal, as appropriate. The assets and liabilities of subsidiaries are measured at their fair
values at the date of acquisition. The difference between the cost of an acquisition and the fair value of the Group’s share
of the net assets of the acquired subsidiary at the date of acquisition is included in the consolidated balance sheet as
goodwill or negative goodwill arising on consolidation.
Acquisition of subsidiaries that meets the conditions of a merger are accounted for using the merger method. Under the
merger method of accounting, the results of subsidiaries are presented as if the merger had been effected throughout the
current and previous financial years. In the consolidated financial statements, the cost of the merger is cancelled with the
nominal values of the shares received. Any resulting credit difference is classified as equity and regarded as a nondistributable reserve. Any resulting debit difference is adjusted against any suitable reserve.
>> 43
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
2. Significant accounting policies (contd.)
2.2
Basis of consolidation (contd.)
Intra-group transactions, balances and resulting unrealised gains are eliminated on consolidation and the consolidated
financial statements reflect external transactions only. Unrealised losses are eliminated on consolidation unless costs
cannot be recovered.
The gain or loss on disposal of a subsidiary company is the difference between net disposal proceeds and the Group’s
share of its net assets together with any unamortised balance of goodwill and exchange differences.
Minority interests in the consolidated balance sheet consist of the minorities’ share of the fair value of the identifiable
assets and liabilities of the acquiree as at acquisition date and the minorities’ share of movements in the acquirees’ equity
since then. Minority interests are separately disclosed in the financial statements.
2.3
Goodwill
Goodwill represents the excess of the cost of acquisition over the Group’s interest in the fair value of the identifiable
assets and liabilities of a subsidiary at the date of acquisition.
Goodwill is stated at cost less accumulated amortisation and impairment losses. The policy for the recognition and
measurement of impairment losses is in accordance with Note 2.14.
Goodwill is amortised on a straight-line basis over its estimated useful life of not more than 20 years.
2.4
Investments in subsidiaries
Investments in subsidiaries are stated at cost less impairment losses. The policy for the recognition and measurement of
impairment losses is in accordance with Note 2.14.
On disposal of such investments, the difference between net disposal proceeds and their carrying amounts is recognised
in the income statement.
2.5
Property, plant and equipment and depreciation
Property, plant and equipment are stated at cost, less accumulated depreciation and impairment losses. The policy for
the recognition and measurement of impairment losses is in accordance with Note 2.14.
The quarry reserve and long leasehold land and buildings of the Group were revalued in 1991 and 1999 respectively,
based on independent professional valuations using open market values on an existing use basis. As permitted by the
MASB, where such revaluations were a one-off isolated event prior to the adoption of the applicable Approved Accounting
Standard by the MASB (MASB Standard 15, �Property, Plant and Equipment’, and International Accounting Standard 16,
the predecessor standard), and provided no further revaluations have been adopted in the preparation of the financial
statements, these assets have continued to be stated on the basis of their previous revalued amounts (subject to continuity
in depreciation policy and the requirement to write the assets down to their recoverable amounts).
Leasehold land with an unexpired lease term of more than fifty years is not depreciated. Short leasehold land is depreciated
over the period of the respective leases which range from 26 years to 49 years. Depreciation of other property, plant and
equipment is provided for on a straight-line basis to write off the cost of each asset to its residual value over the estimated
useful life, at the following annual rates:
>> 44
Notes to the Financial Statements - 31 January 2005 (contd.)
2. Significant accounting policies (contd.)
2.5
Property, plant and equipment and depreciation (contd.)
Buildings
Quarry reserve
Plant, machinery and operating equipment
Motor vehicles
Office furniture and equipment
2 - 25%
5%
6.67 - 50%
10 - 25%
10 - 33.3%
Capital work-in-progress is not depreciated until the property, plant and equipment is fully completed and brought into
use.
Fully depreciated assets are retained in the financial statements until they are no longer in use and no further charge for
depreciation is made in respect of these assets.
Upon the disposal of an item of property, plant or equipment, the difference between the net disposal proceeds and the
net carrying amount is recognised in the income statement and the unutilised portion of the revaluation surplus on that
item is taken directly to retained profit.
2.6
Cash and cash equivalents
Cash and cash equivalents in the Cash Flow Statements represent short-term, highly liquid investments that are readily
convertible to known amounts of cash and which are subject to an insignificant risk of changes in value less short term
borrowings repayable on demand.
2.7
Land held for property development and property development costs
(i)
Land held for property development
Land held for property development consists of land where no development activities have been carried out or
where development activities are not expected to be completed within the normal operating cycle. Such land is
classified within non-current assets and is stated at cost less any accumulated impairment losses. The policy for the
recognition and measurement of impairment losses is in accordance with Note 2.14.
Land held for property development is reclassified as property development costs at the point when development
activities have commenced and where it can be demonstrated that the development activities can be completed
within the normal operating cycle.
(ii) Property development costs
Property development costs comprise all costs that are directly attributable to development activities or that can be
allocated on a reasonable basis to such activities.
When the financial outcome of a development activity can be reliably estimated, property development revenue and
expenses are recognised in the income statement by using the stage of completion method. The stage of completion
is determined by the proportion that property development costs incurred for work performed to date bear to the
estimated total property development costs.
>> 45
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
2. Significant accounting policies (contd.)
2.7
Land held for property development and property development costs (contd.)
(ii) Property development costs (contd.)
Where the financial outcome of a development activity cannot be reliably estimated, property development revenue
is recognised only to the extent of property development costs incurred that is probable will be recoverable, and
property development costs on properties sold are recognised as an expense in the period in which they are incurred.
Any expected loss on a development project, including costs to be incurred over the defects liability period, is
recognised as an expense immediately.
Property development costs not recognised as an expense are recognised as an asset, which is measured at the
lower of cost and net realisable value.
The excess of revenue recognised in the income statement over billings to purchases is classified as accrued
billings within trade receivables and the excess of billings to purchasers over revenue recognised in the income
statement is classified as progress billings within trade payables.
2.8
Inventories
Inventories are stated at the lower of cost and net realisable value and are valued on a weighted average or first-in-firstout basis, as appropriate. Finished goods and work-in-progress include cost of materials, direct labour and an appropriate
proportion of fixed and variable factory overheads.
2.9
Leases
A lease is recognised as a finance lease if it transfers substantially to the Group all the risks and rewards incident to
ownership. All other leases are classified as operating leases.
(i)
Finance leases
Assets acquired by way of hire purchase or finance leases are stated at an amount equal to the lower of their fair
values and the present value of the minimum lease payments at the inception of the leases, less accumulated
depreciation and impairment losses. The corresponding liability is included in the balance sheet as borrowings. In
calculating the present value of the minimum lease payments, the discount factor used is the interest rate implicit in
the lease, when it is practicable to determine; otherwise, the Group’s incremental borrowing rate is used.
Lease payments are apportioned between the finance costs and the reduction of the outstanding liability. Finance
costs, which represent the difference between the total leasing commitments and the fair value of the assets acquired,
are charged to the income statement over the term of the relevant lease so as to produce a constant periodic rate of
charge on the remaining balance of the obligations for each accounting period.
The depreciation policy for leased assets is consistent with that for depreciable property, plant and equipment as
described in Note 2.5.
(ii) Operating leases
Operating lease payments are recognised as an expense in the income statement on a straight-line basis over the
term of the relevant lease.
>> 46
Notes to the Financial Statements - 31 January 2005 (contd.)
2. Significant accounting policies (contd.)
2.10
Income tax
Income tax on the profit or loss for the year comprises current and deferred tax. Current tax is the expected amount of
income taxes payable in respect of the taxable profit for the year and is measured using the tax rates that have been
enacted at the balance sheet date.
Deferred tax is provided for, using the liability method, on temporary differences at the balance sheet date between the
tax bases of assets and liabilities and their carrying amounts in the financial statements. In principle, deferred tax liabilities
are recognised for all taxable temporary differences and deferred tax assets are recognised for all deductible temporary
differences, unused tax losses and unused tax credits to the extent that it is probable that taxable profit will be available
against which the deductible temporary differences, unused tax losses and unused tax credits can be utilised. Deferred
tax is not recognised if the temporary difference arises from goodwill or negative goodwill or from the initial recognition of
an asset or liability in a transaction which is not a business combination and at the time of the transaction, affects neither
accounting profit nor taxable profit.
Deferred tax is measured at the tax rates that are expected to apply in the period when the asset is realised or the liability
is settled, based on tax rates that have been enacted or substantively enacted at the balance sheet date. Deferred tax is
recognised in the income statement, except where it arises from a transaction which is recognised directly in equity, in
which case the deferred tax is also recognised directly in equity, or when it arises from a business combination that is an
acquisition, in which case the deferred tax is included in the resulting goodwill or negative goodwill.
2.11
Employee benefits
(i)
Short term benefits
Wages, salaries, bonuses and social security contributions are recognised as an expense in the year in which the
associated services are rendered by employees of the Group, except where they relate to property development
activities, these expenses are capitalised under property development costs.
(ii) Defined contribution plans
As required by law, companies in Malaysia make contributions to the Employees Provident Fund (�EPF’). Such
contributions are recognised as an expense in the income statement as incurred or capitalised as property
development costs, as appropriate.
(iii) Equity compensation benefits
The Quality Concrete Holdings Berhad Employees’ Share Option Scheme (�ESOS’) allows the Group’s employees
to acquire shares of the Company. No compensation cost or obligation is recognised. When the options are exercised,
equity is increased by the amount of the proceeds received.
2.12
Foreign currencies
Transactions in foreign currencies are initially recorded into Ringgit Malaysia at rates of exchange ruling at the date of the
transaction. At each balance sheet date, foreign currency monetary items are translated into Ringgit Malaysia at exchange
rates ruling at that date. Non-monetary items initially denominated in foreign currencies which are carried at historical
cost are translated using the historical rate as of the date of acquisition and non-monetary items which are carried at fair
value are translated using the exchange rate that existed when the values were determined. All exchange differences
thus arising are dealt with in the income statement.
>> 47
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
2. Significant accounting policies (contd.)
2.12
Foreign currencies (contd.)
The principal exchange rates used for each respective unit of foreign currency ruling at the balance sheet date used are
as follows:
Euro
United States Dollars
2.13
2005
RM
4.948
3.825
====
2004
RM
4.763
3.825
====
Revenue recognition
Revenue is recognised when it is probable that the economic benefits associated with the transaction will flow to the
enterprise and the amount of the revenue can be measured reliably.
(i)
Sale of goods/services
Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer.
Revenue for services rendered is recognised upon performance of services.
(ii) Sale of properties
Revenue from sale of properties is accounted for by the stage of completion method as described in Note 2.7.
(iii) Interest income
Interest income is recognised on an accrual basis unless collectability is in doubt.
(iv) Dividend income
Dividend income is recognised when the right to receive payment is established.
(v) Rental income
Rental income from investment properties is recognised on an accrual basis.
2.14
Impairment of assets
At each balance sheet date, the Group reviews the carrying amounts of its assets to determine whether there is any
indication of impairment. If any such indication exists, impairment is measured by comparing the carrying values of the
assets with their recoverable amounts. Recoverable amount is the higher of net selling price and value in use, which is
measured by reference to discounted future cash flows.
An impairment loss is recognised as an expense in the income statement immediately, unless the asset is carried at a
revalued amount. Any impairment loss of a revalued asset is treated as a revaluation decrease to the extent of any
unutilised previously recognised revaluation surplus for the same asset.
>> 48
Notes to the Financial Statements - 31 January 2005 (contd.)
2. Significant accounting policies (contd.)
2.15
Financial instruments
Financial instruments are recognised in the balance sheet when the Group has become a party to the contractual provisions
of the instrument.
(i)
Other non-current investments
Non-current investments other than investments in subsidiaries are stated at cost less impairment losses. On disposal
of an investment, the difference between net disposal proceeds and its carrying amount is recognised in the income
statement.
(ii) Receivables
Receivables are carried at anticipated realisable values. Bad debts are written off when identified. An estimate is
made for doubtful debts based on a review of all outstanding amounts as at the balance sheet date.
(iii) Payables
Payables are stated at cost which is the fair value of the consideration to be paid in the future for goods and services
received.
(iv) Interest-bearing borrowings
Interest-bearing bank loans and overdrafts are recorded at the amount of proceeds received.
Borrowing costs directly attributable to the acquisition and construction of property, plant and equipment are capitalised
as part of the cost of those assets, until such time as the assets are ready for their intended use or sale. Interest on
borrowed funds utilised for construction of projects or property development activities that require substantial period
of time to get them ready for their intended sale is capitalised as part of the cost of the projects up to the date of
project completion. All other borrowing costs are recognised as an expense in the income statement in the period in
which they are incurred.
(v) Equity instruments
Ordinary shares are classified as equity. Dividends on ordinary shares are recognised in equity in the period in
which they are declared.
>> 49
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
3. Revenue
Revenue of the Group and of the Company consists of the following:
Group
Property development
Manufacturing and premixing
Trading
Quarry operations
Investment and management services
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
4,750
146,507
3,103
1,517
281
–––––––
156,158
======
11,750
140,954
7,829
521
183
–––––––
161,237
======
7,663
––––––
7,663
=====
7,139
––––––
7,139
=====
1,497
110
209
391
1,409
175
223
221
91
5
363
98
231
(231)
–––––––
1,976
(256)
–––––––
1,772
––––––
459
––––––
329
(83)
243
–––––––
2,136
======
(76)
229
–––––––
1,925
======
90
––––––
549
=====
80
––––––
409
=====
4. Finance costs
Bank interest
Hire purchase interest
Term loan interest
Other interest charges
Less: Bank interest capitalised in property
development costs (Note 11)
Interest expense (Note 5)
Less: Bank interest charged to
cost of sales
Add: Bank charges
>> 50
Notes to the Financial Statements - 31 January 2005 (contd.)
5. Profit before taxation
Group
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
57
57
-
-
87
12
53
4,892
75
6
47
5,058
17
3
53
291
14
2
47
297
(1,566)
49
-
9
(281)
14
(183)
49
(6,150)
(281)
3
(6,050)
(183)
5
(1,548)
1,976
(343)
1,772
(37)
(1,548)
459
-
329
-
3,826
(792)
3,826
(537)
13
-
-
(1,232)
(906)
172
14
290
18
19
8
20
8
983
2,286
-
609
(54)
-
-
-
17
262
(303)
10,431
=====
17
225
(485)
10,293
=====
2
28
(276)
1,184
=====
14
28
(240)
964
=====
Profit before taxation is stated after
charging/(crediting):
Amortisation of goodwill (Note 14)
Auditors’ remuneration:
Statutory audit
- current year provision
- underprovision in prior year
Other services
Depreciation (Note 10)
(Gain)/loss on disposal of property,
plant and equipment
Gross dividend income from
- subsidiaries
- investments quoted in Malaysia
Hire of plant and machinery
Impairment in value of investments
net of amount written-back
Interest expense (Note 4)
Interest income
Loss/(gain) on disposal of other
investments
Loss on disposal of property held
for resale
Management fees
Non-executive directors’ remuneration
- fees
- other emoluments
Provision for doubtful debts net of
provision no longer required
Provision for slow moving inventories
no longer required
Property, plant and equipment
written-off
Rental expense
Rental income
Staff costs (Note 6)
>> 51
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
6. Staff costs
Group
Salaries, allowances and bonus
Provident fund contributions
Social security organisation contributions
Other staff related expenses
Total staff costs (including
Executive Directors)
Amount capitalised in property
development costs (Note 11)
Number of employees at the end of the year
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
9,134
973
125
235
––––––
8,718
847
119
621
––––––
1,039
123
4
18
––––––
642
82
3
237
––––––
10,467
10,305
1,184
964
(36)
––––––
10,431
=====
(12)
––––––
10,293
=====
––––––
1,184
=====
––––––
964
=====
677
=====
716
=====
13
=====
10
=====
Included in staff costs of the Group and of the Company are Executive Directors’ remuneration amounting to RM1,007,000 (2004:
RM1,212,000) and RM768,000 (2004: RM783,000) respectively, as further disclosed in Note 7.
7. Directors’ remuneration
Group
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
202
676
209
694
10
676
14
694
103
14
13
–––––
1,008
–––––
83
16
4
–––––
1,006
–––––
82
13
–––––
781
–––––
65
10
4
–––––
787
–––––
52
8
–––––
60
–––––
1,068
–––––
74
12
–––––
86
–––––
1,092
–––––
19
8
–––––
27
–––––
808
–––––
20
8
–––––
28
–––––
815
–––––
Directors of the Company
Executive:
Fees
Salaries and bonus
Provident fund and social security
organisation contributions
Other emoluments
Benefits-in-kind
Non-Executive:
Fees
Other emoluments
>> 52
Notes to the Financial Statements - 31 January 2005 (contd.)
7. Directors’ remuneration (contd.)
Group
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
10
2
–––––
12
–––––
60
112
38
–––––
210
–––––
–––––
–––––
–––––
–––––
120
6
–––––
126
–––––
138
–––––
1,206
====
216
6
–––––
222
–––––
432
–––––
1,524
====
–––––
–––––
–––––
808
====
–––––
–––––
–––––
815
====
1,007
1,212
768
783
186
–––––
308
–––––
27
–––––
28
–––––
1,193
====
1,520
====
795
====
811
====
Directors of subsidiaries
Executive:
Fees
Salaries and bonus
Other emoluments
Non-Executive:
Fees
Other emoluments
Total
Analysis excluding benefits-in-kind:
Total executive directors’
remuneration excluding
benefits-in-kind (Note 6)
Total non-executive directors’
remuneration (Note 5)
Total directors’ remuneration
excluding benefits-in-kind
>> 53
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
7. Directors’ remuneration (contd.)
The number of directors of the Company whose total remuneration during the financial year fell within the following bands is
analysed as below:
Executive
2005
Number of Directors
Non-Executive
2004
2005
2004
Range of remuneration
Below RM50,000
RM50,001 to RM100,000
RM100,001 to RM150,000
RM150,001 to RM200,000
RM200,001 to RM250,000
RM250,001 to RM300,000
RM300,001 to RM350,000
RM350,001 to RM400,000
RM400,001 to RM450,000
1
1
1
===
1
1
1
1
===
5
===
4
===
Executive Directors of the Company have been granted the following number of options under the Employees’ Share Option
Scheme (ESOS):
At 1 February
Granted
At 31 January
2005
2004
600,000
–––––––
600,000
======
400,000
200,000
–––––––
600,000
======
The share options were granted on the same terms and conditions as those offered to other employees of the Group (Note 24).
8. Taxation
Group
Income tax:
Based on profit for the year
(Over)/underprovided in prior years
>> 54
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
4,760
(400)
––––––
4,360
––––––
4,022
(1,198)
––––––
2,824
––––––
1,637
(179)
––––––
1,458
––––––
1,620
25
––––––
1,645
––––––
Notes to the Financial Statements - 31 January 2005 (contd.)
8. Taxation (contd.)
Group
Deferred tax (Note 26):
Relating to origination and reversal of
temporary differences
Underprovided in prior years
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
(2,362)
137
––––––
(2,225)
––––––
2,135
=====
439
16
––––––
455
––––––
3,279
=====
––––––
––––––
1,458
=====
––––––
––––––
1,645
=====
Income tax is calculated at the Malaysian statutory tax rate of 28% (2004: 28%) of the estimated assessable profit for the year.
A reconciliation of income tax expense applicable to profit before taxation at the statutory income tax rate to income tax expense
at the effective income tax rate of the Group and of the Company is as follows:
2005
RM’000
2004
RM’000
6,550
=====
15,585
=====
1,834
(121)
(430)
1,107
8
137
(400)
––––––
2,135
=====
4,364
(80)
493
35
(351)
16
(1,198)
––––––
3,279
=====
3,095
=====
5,281
=====
866
763
8
(179)
––––––
1,458
=====
1,479
133
8
25
––––––
1,645
=====
Group
Profit before taxation
Taxation at Malaysian statutory tax rate of 28% (2004: 28%)
Effect of income subject to tax rate of 20% (2004: 20%)
Effect of income not subject to tax
Effect of expenses not deductible for tax purposes
Deferred tax assets not recognised during the year
Utilisation of current year’s reinvestment allowances
Underprovision of deferred tax in prior years
Overprovision of tax expense in prior years
Tax expense for the year
Company
Profit before taxation
Taxation at Malaysian statutory tax rate of 28% (2004: 28%)
Effect of expenses not deductible for tax purposes
Deferred tax assets not recognised during the year
(Over)/underprovision of tax expense in prior years
Tax expense for the year
>> 55
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
8. Taxation (contd.)
Group
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
17
133
17
133
139
380
=====
145
879
=====
=====
=====
Tax losses are analysed as follows:
Tax savings recognised during the year
arising from:
Utilisation of current year tax losses
Utilisation of tax losses brought forward
from previous years
Unutilised tax losses carried forward
9. Earnings per share
The basic earnings per share is calculated based on the Group’s net profit for the year of RM4,295,000 (2004: RM12,335,000) on
the weighted average number of ordinary shares in issue during the year of RM57,784,917 (2004: 57,241,500).
The diluted earnings per share has been calculated based on the Group’s net profit for the year of RM4,295,000 (2004:
RM12,335,000) and the enlarged weighted average number of ordinary shares in issue during the year of RM59,632,530 (2004:
59,091,091) as follows:
Group
2005
2004
Weighted average number of ordinary shares in issue
57,784,917
57,241,500
Adjustment for Employees’ Share Option Scheme (�ESOS’)
1,847,613
–––––––––
1,849,591
–––––––––
59,632,530
=========
59,091,091
=========
Weighted average number of ordinary shares for
diluted earnings per share
In the diluted earnings per share calculation in relation to the ESOS, a calculation is made to determine the number of shares that
could have been acquired at the respective exercise prices. This calculation serves to determine the �unpurchased’ shares to be
added to the ordinary shares outstanding for the purpose of computing the dilution. No adjustment is made to the profit for the year
for the share option calculation.
>> 56
Notes to the Financial Statements - 31 January 2005 (contd.)
10. Property, plant and equipment
Land
and
buildings
RM’000
Quarry
reserve
RM’000
Plant,
machinery
and
operating
equipment
RM’000
46,288
1,216
(464)
382
–––––––
47,422
======
2,400
–––––––
2,400
======
42,322
724
(150)
(380)
––––––
42,516
=====
13,755
263
(155)
(9)
––––––
13,854
=====
1,470
178
(38)
7
–––––
1,617
====
106,235
2,381
(807)
–––––––
107,809
======
23,422
24,000
–––––––
47,422
======
2,400
–––––––
2,400
======
42,516
––––––
42,516
=====
13,854
––––––
13,854
=====
1,617
–––––
1,617
====
81,409
24,000
2,400
–––––––
107,809
======
22,288
24,000
–––––––
46,288
======
2,400
–––––––
2,400
======
42,322
––––––
42,322
=====
13,755
––––––
13,755
=====
1,470
–––––
1,470
====
79,835
24,000
2,400
–––––––
106,235
======
Motor
vehicles
RM’000
Office
furniture
and
equipment
RM’000
Total
RM’000
Group
Cost/valuation
At 1 February 2004
Additions
Disposals/written-off
Reclassification
At 31 January 2005
Representing:
At 31 January 2005
Cost
At valuation, 1999
At valuation, 1991
At 31 January 2004
Cost
At valuation, 1999
At valuation, 1991
>> 57
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
10. Property, plant and equipment (contd.)
Land
and
buildings
RM’000
Quarry
reserve
RM’000
Plant,
machinery
and
operating
equipment
RM’000
817
120
2,860
1,137
124
5,058
-
-
-
-
1
1
817
=====
120
=====
2,860
=====
1,137
=====
125
====
5,059
=====
4,182
1,470
26,378
9,307
907
42,244
1,129
120
2,466
1,053
124
4,892
-
-
-
-
1
1
1,129
120
2,466
1,053
125
4,893
––––––
5,311
=====
––––––
1,590
=====
(151)
––––––
28,693
=====
(146)
––––––
10,214
=====
(30)
–––––
1,002
====
(327)
––––––
46,810
=====
Motor
vehicles
RM’000
Office
furniture
and
equipment
RM’000
Total
RM’000
Group
Accumulated depreciation
Charged to income
statement (Note 5)
Capitalised in property
development costs
(Note 11)
Depreciation charge
for 2004
At 1 February 2004
Depreciation charge for
the year:
Charged to income
statement (Note 5)
Capitalised in property
development costs
(Note 11)
Disposals/written-off
At 31 January 2005
>> 58
Notes to the Financial Statements - 31 January 2005 (contd.)
10. Property, plant and equipment (contd.)
Land
and
buildings
RM’000
Quarry
reserve
RM’000
Plant,
machinery
and
operating
equipment
RM’000
19,588
22,523
––––––
42,111
=====
810
––––––
810
=====
13,823
––––––
13,823
=====
Motor
vehicles
RM’000
Office
furniture
and
equipment
RM’000
3,640
––––––
3,640
=====
615
–––––
615
====
Total
RM’000
Group
Net book value
At 31 January 2005
At cost
At valuation
Work-in-progress
At 31 January 2004
At cost
At valuation
37,666
23,333
––––––
60,999
401
––––––
61,400
=====
20,439
21,667
––––––
42,106
=====
930
––––––
930
=====
15,944
––––––
15,944
=====
4,448
––––––
4,448
=====
563
–––––
563
====
Work-in-progress
41,394
22,597
––––––
63,991
640
––––––
64,631
=====
Details at 1 February 2003
Cost
At valuation, 1999
At valuation, 1991
Accumulated depreciation
21,761
24,000
3,520
=====
2,400
1,350
=====
38,448
23,418
=====
13,079
8,476
=====
1,353
802
====
74,641
24,000
2,400
37,566
======
>> 59
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
10. Property, plant and equipment (contd.)
Land
and
buildings
RM’000
Motor
vehicles
RM’000
Office
furniture
and
equipment
RM’000
7,781
––––––
7,781
=====
370
––––––
370
=====
123
22
(9)
––––––
136
=====
8,274
22
(9)
––––––
8,287
=====
240
=====
46
=====
11
=====
297
=====
977
36
55
1,068
240
––––––
1,217
=====
37
––––––
73
=====
14
(7)
––––––
62
=====
291
(7)
––––––
1,352
=====
At 31 January 2005
6,564
=====
297
=====
74
=====
6,935
=====
At 31 January 2004
6,804
=====
334
=====
68
=====
7,206
=====
7,767
737
=====
507
216
=====
142
60
=====
8,416
1,013
=====
Total
RM’000
Company
Cost
At 1 February 2004
Additions
Written-off
At 31 January 2005
Accumulated depreciation
Depreciation charge for 2004
(Note 5)
At 1 February 2004
Depreciation charge for the
year (Note 5)
Written-off
At 31 January 2005
Net book value
Details at 1 February 2003
Cost
Accumulated depreciation
>> 60
Notes to the Financial Statements - 31 January 2005 (contd.)
10. Property, plant and equipment (contd.)
Analysis of land and buildings:
Group
Long leasehold land
Short leasehold land
Buildings
Residential property
Renovation
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
12,013
7,835
27,061
408
105
––––––
47,422
=====
12,908
7,835
25,032
408
105
––––––
46,288
=====
7,696
85
––––––
7,781
=====
7,696
85
––––––
7,781
=====
The valuation on the long leasehold land and buildings of a subsidiary was adopted by its directors based on independent
valuation carried out by professional valuers in 1999 on an open market value basis. The independent valuation was carried out
by Chew Kwong Cheong (V-141), a register valuer of Jordan Lee, Jaafar & Chew Sdn. Bhd. The surplus on revaluation was
credited to the revaluation reserve.
The valuation of the quarry reserve in 1991 was based on directors’ valuation. The resultant revaluation surplus was credited to
the revaluation reserve.
Had the revalued assets been carried at historical cost less accumulated depreciation and impairment losses, the carrying amount
of the revalued assets would have been as follows:
Group
Long leasehold land
Buildings
Quarry reserve
2005
RM’000
2004
RM’000
2,650
3,410
––––––
6,060
=====
2,650
3,351
––––––
6,001
=====
>> 61
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
10. Property, plant and equipment (contd.)
(a)
The net book values of property, plant and equipment pledged to bankers for banking facilities granted to the Group and the
Company, as disclosed in Note 20, are as follows:
Group
Long leasehold land
Short leasehold land
Buildings
Plant and machinery
(b)
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
2,651
6,652
10,512
8,934
––––––
28,749
=====
10,024
6,761
21,000
3,867
––––––
41,652
=====
6,530
––––––
6,530
=====
6,761
––––––
6,761
=====
During the financial year, the Group and the Company acquired property, plant and equipment at aggregate costs of
RM2,144,000 (2004: RM6,459,000) and RM22,000 (2004: RM223,000) respectively, of which RM162,000 (2004:
RM1,081,000) and Nil (2004: RM150,000) were acquired by means of hire purchase arrangements. Net book values of
property, plant and equipment held under hire purchase arrangements are as follows:
Group
Motor vehicles
Plant and machinery
(c)
>> 62
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
2,583
1,113
––––––
3,696
=====
2,778
1,113
––––––
3,891
=====
175
––––––
175
=====
195
––––––
195
=====
The title to a parcel of leasehold land of a subsidiary has yet to be issued by the relevant authority.
Notes to the Financial Statements - 31 January 2005 (contd.)
11. Land held for property development and property development costs
Group
(a)
2004
RM’000
3,410
3,040
––––––
6,450
=====
3,409
––––––
3,409
=====
11,000
20,692
––––––
31,692
––––––
11,000
12,479
––––––
23,479
––––––
4,482
––––––
8,213
––––––
(21,481)
(4,289)
––––––
(25,770)
––––––
10,404
=====
(10,800)
(10,681)
––––––
(21,481)
––––––
10,211
=====
Land held for property development
Short leasehold land, at cost
Long leasehold land, at cost
(b)
2005
RM’000
Property development costs
Property development costs at 1 February:
Short leasehold land, at valuation
Development costs
Costs incurred during the year:
Development costs
Costs recognised in income statement:
At 1 February
Recognised during the year
At 31 January
Property development costs at 31 January
The revaluation of the short leasehold land was adopted by the directors based on an independent valuation carried out by
Radzali Bin Alision (V-274) registered valuer of C.H.Williams Talhar Wong & Yeo Sdn. Bhd., in 1999 on the comparison and
residual basis. The surplus arising from the revaluation has been credited to the revaluation reserve.
The short leasehold land amounting to RM11,000,000 (2004: RM11,000,000) has been charged as security for banking
facilities granted to a subsidiary as referred to in Note 20.
Included in property development costs incurred during the year are:
Group
Interest expense (Note 4)
Depreciation (Note 10)
Staff costs (Note 6)
2005
RM’000
2004
RM’000
231
1
36
=====
256
1
12
=====
Included in staff costs are provident fund contributions amounting to RM3,654 (2004: RM812).
>> 63
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
12. Investment in subsidiaries
Company
Unquoted shares, at cost
2005
RM’000
2004
RM’000
70,903
=====
70,903
=====
Details of subsidiaries, all of which are incorporated in Malaysia, are as follows:
Name of subsidiaries
Equity interest
held (%)
2005
2004
Principal activities
Direct subsidiaries of the Company
Quality Concrete Sdn. Bhd.
100
100
Manufacture and sale of ready-mixed
concrete, sale of concrete products
and trading of goods
Polyflow Pipes Sdn. Bhd.
100
100
Manufacture and sale of high density
polyethylene pipes
Kutex Sdn. Bhd.
100
100
Manufacture and sale of woven
polypropylene bags and polyethylene
liners
Hong Wei Holdings Sdn. Bhd.
100
100
Property development
Lee Ling Timber Products
Sendirian Berhad
100
100
Sawmilling and manufacture of other
downstream timber products
Agrowell Sdn. Bhd.
100
100
Quarry operations and sale of
aggregates and related products
70
70
Dormant
Subsidiary of Quality Concrete
Sdn. Bhd.
Quality Concrete (Mukah)
Sdn. Bhd.
>> 64
Notes to the Financial Statements - 31 January 2005 (contd.)
13. Other investments
Group/Company
2005
2004
RM’000
RM’000
Quoted securities of Malaysian corporations, at cost:
Ordinary shares
Warrants
Impairment in value of investments
7,858
1,376
––––––
9,234
(566)
––––––
8,668
=====
9,096
2,831
––––––
11,927
(2,114)
––––––
9,813
=====
7,280
1,170
––––––
8,450
=====
7,046
1,127
––––––
8,173
=====
Market value:
Ordinary shares
Warrants
The directors are of the opinion that the impairment in value of investments made of RM565,808 (2004: RM2,114,230) for the
Group and Company is adequate.
Certain of the quoted shares have been pledged as security for margin facilities granted by the securities firms as disclosed in
Note 22.
14. Goodwill on consolidation
Group
2005
RM’000
2004
RM’000
1,142
=====
1,142
=====
(57)
(57)
––––––
(114)
=====
(57)
––––––
(57)
=====
1,028
=====
1,085
=====
Cost
At 1 February and 31 January
Accumulated amortisation
At 1 February
Amortisation for the year (Note 5)
At 31 January
Net book value
>> 65
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
15. Inventories
Group
2005
RM’000
2004
RM’000
6,931
4,620
12,727
1,172
2,024
79
––––––
27,553
=====
7,171
7,780
11,124
1,054
2,716
75
––––––
29,920
=====
At cost:
Raw materials
Sawn timber
Semi-finished and finished goods
Spare parts and consumables
Properties held for resale
Others
Properties held for resale by a subsidiary amounting to RM1,680,000 (2004: RM1,680,000) have been pledged to bankers for
banking facilities granted to the subsidiary.
16. Trade receivables
Group
Trade receivables
Accrued billings in respect of property
development costs
Provision for doubtful debts
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
58,770
56,846
609
609
788
(5,962)
––––––
53,596
=====
3,171
(4,979)
––––––
55,038
=====
(609)
–––––
====
(609)
–––––
====
Included in trade receivables of the Group is an amount of RM7,731,626 (2004: RM9,144,432) due from companies in which
certain directors of the Group have substantial financial interest. The amount is unsecured, earns interest ranging between 8% to
18% (2004: 8% to 18%) per annum and has no fixed term of repayment.
The Group’s normal trade credit terms range from 14 to 120 days. Other credit terms are assessed and approved on a case-bycase basis.
The Group has no significant concentration of credit risk that may arise from exposures to a single receivable or to groups of
receivables.
>> 66
Notes to the Financial Statements - 31 January 2005 (contd.)
17. Other receivables
Group
Sundry receivables
Prepayments
Deposits
Retention sums on contracts
Current tax assets
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
14,026
284
665
1,847
2,513
––––––
19,335
=====
14,870
259
2,707
1,127
1,429
––––––
20,392
=====
1,179
12
118
828
–––––
2,137
====
1,178
55
485
–––––
1,718
====
Included in sundry receivables of the Group and the Company is an amount of RM277,642 (2004: RM277,642) representing
shortfall in profit guarantee receivable from certain shareholders of the Company. The amount is receivable in accordance with the
provisions of the Profit Guarantee and Stakeholders’ Agreement entered into between the Company, the guarantors and HSBC
(M) Trustee Berhad arising from the listing of the Company’s shares on the Bursa Malaysia Securities Berhad. This amount shall
be recovered upon the sale of the shares currently pledged with the trustee.
Included in sundry receivables of the Group is an amount of RM1,356,795 (2004: RM2,634,397) due from companies in which
certain directors have substantial financial interest. The amount is unsecured, interest-free and has no fixed term of repayment.
The Group has no significant concentration of credit risk that may arise from exposures to a single receivable or to groups of
receivables.
18. Amount due from/(to) subsidiaries
Company
2005
RM’000
Amount due from subsidiaries
Amount due to subsidiaries
19,914
(4,119)
––––––
15,795
=====
The amounts due from/(to) subsidiaries are unsecured, interest-free and have no fixed term of repayment.
2004
RM’000
17,339
(5,815)
––––––
11,524
=====
19. Fixed deposits with a licensed bank
The weighted average interest rate of deposits of the Group at the balance sheet date was at 3% (2004: 3%) and the average
maturity as at end of the financial year was 30 days (2004: 30 days).
>> 67
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
20. Borrowings
Group
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
2,841
1,312
733
––––––
4,886
=====
5,734
1,729
768
––––––
8,231
=====
50
–––––
50
====
50
–––––
50
====
4,328
19,478
3,000
––––––
26,806
––––––
31,692
=====
2,484
21,236
3,000
––––––
26,720
––––––
34,951
=====
1,230
–––––
1,230
–––––
1,280
====
1,157
–––––
1,157
–––––
1,207
====
1,049
284
––––––
1,333
=====
2,318
871
––––––
3,189
=====
46
–––––
46
====
96
–––––
96
====
7,169
2,361
1,017
19,478
3,000
––––––
33,025
=====
8,218
4,047
1,639
21,236
3,000
––––––
38,140
=====
1,230
96
–––––
1,326
====
1,157
146
–––––
1,303
====
30,959
699
350
––––––
32,008
=====
34,183
1,812
506
––––––
36,501
=====
1,230
–––––
1,230
====
1,157
–––––
1,157
====
Short term borrowings
Secured:
Bank overdrafts
Term loans
Hire purchase payables (Note 23)
Unsecured:
Bank overdrafts
Bankers’ acceptances
Revolving credit
Long term borrowings
Secured:
Term loans
Hire purchase payables (Note 23)
Total borrowings
Bank overdrafts (Note 27)
Term loans
Hire purchase payables (Note 23)
Bankers’ acceptances
Revolving credit
Maturity of borrowings
(excluding hire purchase):
Within one year
More than 1 year and less than 2 years
More than 2 years and less than 5 years
>> 68
Notes to the Financial Statements - 31 January 2005 (contd.)
20. Borrowings (contd.)
The weighted average effective interest rates at the balance sheet date for borrowings, excluding hire purchase payables, were
as follows:
Group
Company
2005
2004
2005
2004
%
%
%
%
Bank overdrafts
Term loans
Bankers’ acceptances
Revolving credit
7.50 - 8.00
4.00 - 7.30
2.87 - 4.30
3.80 - 5.50
========
7.00 - 8.40
4.00 - 8.25
2.86 - 7.50
3.75 - 5.50
========
7.50
========
7.40 - 8.30
========
The secured bank overdrafts of the Group are secured by a floating debenture of RM3 million over all the assets of a subsidiary
company and certain assets of the Group as disclosed in Note 10.
(a)
The term loan of RM402,585 (2004: RM637,900) of a subsidiary is secured by a deed of assignment over certain landed
properties of the subsidiary, and first and second legal charges to be created over the said properties upon issuance of
strata title as disclosed in Note 10. The loan carries interest at 7.25% (2004: 7.65% to 8.05%) per annum and is repayable
by 72 monthly instalments commencing September 2000.
(b)
Term loans of RM1,958,548 (2004: RM3,330,598) of another subsidiary are secured by a first fixed charge over certain
machinery, equipment and factory building of the subsidiary to which the loans are granted, and land belonging to the
Company. The first loan bears interest at 6.00% to 7.25% (2004: 4.88% to 6.00%) per annum and is repayable by 35
monthly instalments commencing September 2002. The remaining loans bear interest at the rates of 4.00%, 6.25% and
7.00% (2004: 4.00%, 6.25% and 7.00%) per annum calculated on monthly rests and are repayable by 48 monthly instalments
commencing February 2003, November 2003 and December 2003, respectively.
(c)
The term loan of a subsidiary which was secured by a debenture covering a first fixed charge over certain machinery of the
Company, bore interest at 4.00% per annum on yearly rests and repayable by 36 monthly instalments commencing December
2001, was settled during the year.
21. Trade payables
The normal trade credit terms granted to the Group range from 30 to 120 days.
22. Other payables
Group
Sundry payables
Accruals
Deposit
Amount due to a director
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
9,705
1,065
24
––––––
10,794
=====
10,266
954
93
––––––
11,313
=====
3,595
223
––––––
3,818
=====
2,829
128
––––––
2,957
=====
Included in sundry payables of the Group and Company is an amount of RM3,564,797 (2004: RM2,816,004) of which quoted
shares have been pledged as security for margin facilities granted by the securities firms referred to in Note 13.
>> 69
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
22. Other payables (contd.)
Included in sundry payables of the Group is an amount of RM541,258 (2004: RM279,980) due to companies in which certain
directors have substantial financial interest. The amount is unsecured, interest-free and has no fixed term of repayment.
23. Hire purchase payables
Group
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
783
876
55
55
192
742
51
55
95
24
––––––
1,094
(77)
––––––
180
––––––
1,798
(159)
––––––
––––––
106
(10)
––––––
51
––––––
161
(15)
––––––
1,017
=====
1,639
=====
96
=====
146
=====
733
768
50
50
176
703
46
50
85
23
––––––
1,017
=====
168
––––––
1,639
=====
––––––
96
=====
46
––––––
146
=====
733
284
––––––
1,017
=====
768
871
––––––
1,639
=====
50
46
––––––
96
=====
50
96
––––––
146
=====
Minimum hire purchase payments:
- Not later than 1 year
- Later than 1 year and not later
than 2 years
- Later than 2 years and not later
than 5 years
- Later than 5 years
Less: Future finance charges
Present value of hire purchase
liabilities
Present value of hire purchase liabilities:
- Not later than 1 year
- Later than 1 year and not later
than 2 years
- Later than 2 years and not later
than 5 years
- Later than 5 years
Analysed as:
Due within 12 months (Note 20)
Due after 12 months (Note 20)
The hire purchase liabilities bore interest at the balance sheet date at rates ranging between 3.40% to 9.31% (2004: 3.40% to
9.30%) per annum.
>> 70
Notes to the Financial Statements - 31 January 2005 (contd.)
24. Share capital
Number of Ordinary
Shares of RM1 Each
2005
2004
�000
�000
Amount
2005
RM’000
2004
RM’000
Authorised
At 1 February and at 31 January
100,000
======
100,000
======
100,000
======
100,000
======
57,413
540
––––––
57,953
=====
57,179
234
––––––
57,413
=====
57,413
540
––––––
57,953
=====
57,179
234
––––––
57,413
=====
Issued and fully paid
At 1 February
Employees’ Share Option Scheme (�ESOS’)
At 31 January
During the current financial year, the issued and paid-up share capital of the Company was increased from 57,413,000 to 57,953,000
by the issuance of 540,000 new ordinary shares of RM1 each on conversion of 499,000, 21,000 and 20,000 options at the option
prices of RM1.38, RM1.53 and RM1.59 each, respectively. All the new ordinary shares that were issued rank pari passu in all
respects with the existing shares of the Company. The share premium arising from the issue amounted to RM213,000.
As at 31 January 2005, the number of options offered and granted to Eligible Employees and Executive Directors of the Group to
subscribe for ordinary shares of RM1 each remaining unexercised was 2,877,000 (2004: 3,586,000).
The options granted under the ESOS established are effective for a period of five years from 30 November 2001 onwards.
25. Reserves
Group
Non-distributable
Share premium
Revaluation reserve
Capital reserve
Distributable
Retained profit
Total reserves
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
24,990
5,797
846
––––––
31,633
24,777
7,045
846
––––––
32,668
24,990
––––––
24,990
24,777
––––––
24,777
43,863
––––––
75,496
=====
38,320
––––––
70,988
=====
16,351
––––––
41,341
=====
14,714
––––––
39,491
=====
Movements in reserves are shown in the Statements of Changes in Equity.
(a)
As at 31 January 2005, the Company has tax exempt profits available for distribution of approximately RM2.3 million (2004:
RM2.3 million), subject to the agreement of the Inland Revenue Board.
The Company has sufficient tax credit under Section 108 of the Income Tax Act 1967 and the balance in the tax-exempt
income account to frank the payment of dividends out of its entire retained profit as at 31 January 2005.
(b)
The revaluation reserve represents surplus on revaluation of certain landed properties and quarry reserve of subsidiaries.
>> 71
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
26. Deferred tax liabilities
Group
RM’000
At 1 February 2004/2003
Recognised in the income statement (Note 8)
At 31 January 2005/2004
RM’000
8,535
(2,225)
–––––
6,310
====
8,080
455
–––––
8,535
====
(473)
6,783
–––––
6,310
====
(320)
8,855
–––––
8,535
====
Presented after appropriate offsetting as follows:
Deferred tax assets
Deferred tax liabilities
The components and movements of deferred tax liabilities and assets of the Group during the financial year prior to offsetting
are as follows:
Accelerated
capital
allowances
RM’000
Revaluation
of quarry
reserve
RM’000
Revaluation
of land
and buildings
RM’000
Others
RM’000
Total
RM’000
3,313
294
5,262
-
8,869
15
––––––
3,328
=====
(34)
––––––
260
=====
(59)
––––––
5,203
=====
64
––––––
64
=====
(14)
––––––
8,855
=====
3,328
260
5,203
64
8,855
200
––––––
3,528
=====
(33)
––––––
227
=====
(2,175)
––––––
3,028
=====
(64)
––––––
=====
(2,072)
––––––
6,783
=====
Deferred tax liabilities:
At 1 February 2003
Recognised in the
income statement
At 31 January 2004
At 1 February 2004
Recognised in the
income statement
At 31 January 2005
>> 72
Notes to the Financial Statements - 31 January 2005 (contd.)
26. Deferred tax liabilities (contd.)
Unutilised tax losses,
reinvestment
and capital
allowances
RM’000
Others
RM’000
Total
RM’000
Deferred tax assets:
At 1 February 2003
Recognised in the
income statement
At 31 January 2004
At 1 February 2004
Recognised in the
income statement
At 31 January 2005
(716)
(73)
(789)
422
–––––
(294)
====
47
–––––
(26)
====
469
–––––
(320)
====
(294)
(26)
(320)
(168)
–––––
(462)
====
15
–––––
(11)
====
(153)
–––––
(473)
====
27. Cash and cash equivalents
Group
Cash and bank balances
Fixed deposits with a licensed bank
Bank overdrafts (Note 20)
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
4,902
300
(7,169)
––––––
(1,967)
=====
5,210
300
(8,218)
––––––
(2,708)
=====
(1,230)
––––––
(1,230)
=====
(1,157)
––––––
(1,157)
=====
28. Capital commitments
Group
2005
RM’000
2004
RM’000
2,084
====
3,759
====
Authorised capital expenditure not
provided for in the financial statements:
Approved and contracted for
>> 73
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
29. Contingent liabilities
Company
(a)
(b)
Corporate guarantees in respect of banking and credit
facilities granted to subsidiaries
2005
RM’000
2004
RM’000
86,300
=====
70,400
=====
A subsidiary of the Company was awarded a contract to construct a school which it later sub-contracted to another party
with progress claims payable on a �back-to-back’ basis. Following the delay in the completion of the project, there are
potential liquidated ascertained damages (�LAD’) in the region of RM2 million which may be imposed by the client. In the
event the LAD charges are imposed on the subsidiary, the subsidiary will be able to pass on the claims to its sub-contractor
in view of the �back-to-back’ arrangements.
30. Segment information
The Group is organised into five major business segments:
(i)
Property development - sale of properties;
(ii)
Manufacturing and premixing - manufacture and sale of ready-mixed concrete, concrete products, high density polyethylene
pipes, woven polypropylene bags and polyethylene liners, sawmilling and manufacture of downstream products;
(iii)
Trading - general trading;
(iv)
Quarry operations - extracting and sale of aggregates; and
(v)
Investment and management services - investment holding and advisory.
The Group operates principally within Malaysia and accordingly no geographical segment information is prepared.
The directors are of the opinion that all inter-segment transactions have been entered into in the normal course of business and
have been established on terms and conditions that are not materially different from those obtainable in transactions with unrelated
parties.
>> 74
Notes to the Financial Statements - 31 January 2005 (contd.)
30. Segment information (contd.)
Manufacturing
Property
and
development
premixing
RM’000
RM’000
2005
Revenue
External sales
Inter-segment sales
Trading
RM’000
Investment and
Quarry management
operations
services Eliminations
RM’000
RM’000
RM’000
Total
RM’000
4,750
–––––––
4,750
======
146,507
53
–––––––
146,560
======
3,103
–––––––
3,103
======
1,517
1,852
––––––
3,369
=====
281
7,382
––––––
7,663
=====
(9,287)
–––––––
(9,287)
======
156,158
–––––––
156,158
======
388
(52)
–––––––
336
–––––––
336
======
8,859
(1,359)
(2,214)
–––––––
5,286
(120)
–––––––
5,166
======
1,608
(229)
(4)
–––––––
1,375
–––––––
1,375
======
396
(1)
(129)
––––––
266
––––––
266
=====
3,644
(549)
(1,458)
––––––
1,637
––––––
1,637
=====
(6,209)
2
1,722
–––––––
(4,485)
–––––––
(4,485)
======
8,686
(2,136)
(2,135)
–––––––
4,415
(120)
–––––––
4,295
======
Segment assets
17,667
======
153,379
======
1,883
======
1,939
=====
17,740
=====
1,028
======
193,636
======
Segment liabilities
6,969
======
39,148
======
8,103
======
823
=====
5,144
=====
60,187
======
1
======
2,104
======
======
15
=====
22
=====
2,142
======
Amortisation of goodwill
======
======
======
=====
57
=====
57
======
Depreciation
1
======
4,221
======
141
======
239
=====
291
=====
4,893
======
Results
Segment operating profit
Finance costs
Income taxes
Profit after taxation
Minority interest
Net profit for the year
Other information
Capital expenditure
>> 75
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
30. Segment information (contd.)
Manufacturing
Property
and
development
premixing
RM’000
RM’000
2004
Revenue
External sales
Inter-segment sales
Eliminations
RM’000
Total
RM’000
11,750
–––––––
11,750
======
140,954
337
–––––––
141,291
======
7,829
191
–––––––
8,020
======
521
3,052
––––––
3,573
=====
183
6,956
––––––
7,139
=====
(10,536)
–––––––
(10,536)
======
161,237
–––––––
161,237
======
954
(230)
–––––––
724
–––––––
724
======
14,943
(1,257)
(3,164)
–––––––
10,522
29
–––––––
10,551
======
1,710
(268)
160
–––––––
1,602
–––––––
1,602
======
329
(93)
––––––
236
––––––
236
=====
5,690
(409)
(1,646)
––––––
3,635
––––––
3,635
=====
(6,116)
9
1,694
–––––––
(4,413)
–––––––
(4,413)
======
17,510
(1,925)
(3,279)
–––––––
12,306
29
–––––––
12,335
======
Segment assets
19,584
======
156,440
======
2,345
======
1,817
=====
18,738
=====
1,085
======
200,009
======
Segment liabilities
9,653
======
46,179
======
10,704
======
932
=====
4,260
=====
71,728
======
======
6,191
======
======
45
=====
223
=====
6,459
======
Amortisation of goodwill
======
======
======
=====
57
=====
57
======
Depreciation
1
======
4,452
======
45
======
264
=====
297
=====
5,059
======
Results
Segment operating profit
Finance costs
Income taxes
Profit after taxation
Minority interest
Net profit for the year
Other information
Capital expenditure
>> 76
Trading
RM’000
Investment and
Quarry management
operations
services
RM’000
RM’000
Notes to the Financial Statements -31 January 2005 (contd.)
31. Significant related party transactions
During the financial year, the Group and the Company had, in the ordinary course of business, transacted on normal commercial
terms the following transactions:
Company
2005
2004
RM’000
RM’000
(a) Transactions with subsidiaries
Income
Gross dividend income
Rental income
Management fees
6,150
276
1,232
====
Group
(b)
6,050
240
906
====
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
(i) Sales of pipes/fittings to Lee Ling
Construction & Development
Sdn. Bhd.
162
435
-
-
(ii) Sales of concrete, steel bars and
R.C. piles to Jurudaya
Construction Sdn. Bhd.
937
604
-
-
11
13
-
-
2,725
3,014
-
-
(v) Sales of sawn timber to Lee Ling
Construction & Development
Sdn. Bhd.
170
372
-
-
(vi) Sales of sawn timber to Lee Ling
Timber Sdn. Bhd.
2
11
-
-
====
6
====
====
====
Transactions with companies in which
certain Directors of the Company
and/or persons connected to them have
a substantial financial interest and/or
are Directors:
Income
(iii) Sales of concrete to Lee Ling
Timber Sdn. Bhd.
(iv) Sales of concrete, cement, steel bars
and R.C. piles to Lee Ling Construction
& Development Sdn. Bhd.
(vii) Sales of sawn timber to BMK
Development Sdn. Bhd.
>> 77
Financial
Statements
Financial
Statements
Incorporated In Malaysia <<
Notes to the Financial Statements - 31 January 2005 (contd.)
31. Significant related party transactions (contd.)
Group
(b)
Company
2005
RM’000
2004
RM’000
2005
RM’000
2004
RM’000
24
24
-
-
70
70
70
70
4,236
====
3,912
====
====
====
49
====
23
====
====
====
93
====
182
====
====
====
Transactions with companies in which
certain Directors of the Company
and/or persons connected to them have
a substantial financial interest and/or
are Directors (contd.):
Expenditure
Rental paid to Jurudaya
Construction Sdn. Bhd.
Rental paid to BMK
Development Sdn. Bhd.
Purchase of sawn timber from
Lee Ling Timber Sdn. Bhd.
(c)
Transaction with companies in which
certain Directors of subsidiaries and/or
persons connected to them have a
substantial financial interest and/or are
Directors:
Income
Sales of sawn timber to Chung Maa
Machinery Sdn. Bhd.
Expenditure
Purchase of spare parts from Chung
Maa Machinery Sdn. Bhd.
>> 78
Notes to the Financial Statements - 31 January 2005 (contd.)
32. Financial instruments
(a)
Financial risk management objectives and policies
The Group’s financial risk management policy seeks to ensure that adequate financial resources are available for the
development of the Group’s businesses whilst managing its interest rate, foreign exchange, liquidity and credit risks.
(b)
Interest rate risk
The Group’s primary interest rate risk relates to interest-bearing debts, which includes bank borrowings and hire purchase
commitments. The Group’s policy is to obtain the most favourable interest rates available.
(c)
Foreign exchange risk
The Group engages in foreign currency denominated transactions. However, the management is of the opinion that the
Group’s exposure to movements in foreign currency exchange rates risk is minimal as most of its foreign denominated
transactions are in United States Dollars which is currently pegged at a fixed rate of exchange. Hence, the Group does not
use derivative financial instruments to protect against the volatility associated with foreign currency transactions and other
financial assets and liabilities created in the ordinary course of business.
(d)
Liquidity risk
The Group actively manages its debt maturity profile, operating cash flows and the availability of funding so as to ensure
that all repayment and funding needs are met. As part of its overall prudent liquidity management, the Group maintains
sufficient levels of cash and cash equivalents to meet its working capital requirements. In addition, the Group strives to
maintain available banking facilities of a reasonable level to its overall debt position. As far as possible, the Group raises
committed funding from both capital markets and financial institutions and prudently balances its portfolio with some shortterm funding so as to achieve overall cost effectiveness.
(e)
Credit risk
Credit risks, or the risk of counterparties defaulting, is controlled by the application of credit approvals, limits and monitoring
procedures. Credit risks are minimised and monitored via strictly limiting the Group’s associations to business partners with
high creditworthiness. Trade receivables are monitored on an ongoing basis via Group management reporting procedures.
The Group does not have any significant exposure to any individual customer or counterparty nor does it have any major
concentration of credit risk related to any financial instruments.
(f)
Fair values
The management is of the view that the carrying amounts of the Group’s financial assets and liabilities recorded at balance
sheet date approximate their corresponding fair value.
>> 79
Incorporated In Malaysia <<
Analysis of shareholdings - as at 5 May 2005
Authorised Share Capital
Issued and Paid-up Share Capital
Class of Shares
Voting Rights
:
:
:
:
RM100,000,000
RM57,962,000 comprising 57,962,000 Ordinary Shares of RM1.00 each
Ordinary Shares of RM1.00 each
One Vote Per Ordinary Share
Distribution Schedule
Size of Shareholdings
less than 100
100 to 1,000
1,001 to 10,000
10,001 to 100,000
100,001 to less than 5% of issued shares
5% and above of issued shares
No. of Holders
% of Holders
No. of Shares
% of Holders
4
1,827
1,533
199
32
4
0.11
50.76
42.60
5.53
0.89
0.11
241
1,815,443
5,634,881
5,442,278
22,768,157
22,301,000
0.00
3.13
9.72
9.39
39.28
38.48
3,599
100.00
57,962,000
100.00
Substantial Shareholders as at 5 May 2005
According to the Register of substantial shareholders, the substantial shareholders of the Company as at 5 May 2005 are as follows:
Name of Substantial Shareholders
Direct
%
Deemed interest
%
1. HDM Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for
Cahaya Besi (Sarawak) Sdn. Bhd.
9,151,900
15.79
-
-
2. Ha Ai Ing
7,001,000
12.08
10,640,000
18.36
3. Tiang Ming Sing
6,915,000
11.93
10,726,000
18.51
4. HSBC Nominees (Asing) Sdn. Bhd.
HSBCIT (S) Ltd for Entrequest Holdings Limited
5,800,000
10.01
-
-
List of Directors’ Interest
According to the Register of Directors’ Shareholdings, the interest of Directors in the ordinary shares of the Company as at 5 May 2005
are as follows:
1.
2.
3.
4.
5.
6.
7.
>> 80
Tiang Ming Sing
Tiang Ching Kok
Datuk Hajjah Raziah @ Rodiah Binti Mahmud
Edmund Goh Chze Jin
Alfed Ong Sze Lee
Robin Lo Bing
Michael Ong Kee Tuan
Direct
%
Deemed interest
%
6,915,000
1,179,000
272,405
-
11.93
2.03
0.47
-
10,726,000
17,641,000
15,000
-
18.51
30.44
0.03
-
Thirty Largest shareholdings - as at 5 May 2005
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.
Ha Ai Ing
HSBC Nominees (Asing) Sdn. Bhd.
HSBCIT (S) Ltd for Entrequest Holdings Limited
RHB Capital Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Tiang Ming Sing
HDM Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Cahaya Besi (Sarawak) Sdn. Bhd.
HDM Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Yesgains Sdn. Bhd.
Kenanga Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Cahaya Besi (Sarawak) Sdn. Bhd.
Cahaya Besi (Sarawak) Sdn. Bhd.
HLB Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Tiang Chiin Yew
AMSEC Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Tiang Ming Sing
OSK Nominees (Tempatan) Sdn. Bhd.
OSK Capital Sdn. Bhd.
For Lee Ling Holdings Sdn. Bhd.
HDM Nominees (Tempatan) Sdn. Bhd.
HDM Capital Sdn. Bhd.
For Datuk Hajjah Raziah @ Rodiah Binti Mahmud
Datuk Abdul Hamed Bin Sepawi
Goh Keng Boo
Chieng Lee Hook
Datuk Mazelan Bin Bugo
HDM Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Lo Ga Lung
Encorp Properties Sdn. Bhd.
Kenanga Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Tiang Chiin Ling
HDM Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Law Wee
HDM Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Hwang Ai Mor
Yong Lin Lin
Citicorp Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Tiang Chiin Yew
Citicorp Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Tiang Ming Sing
Datuk Amar Hj. Aziz Bin Hj. Husain
Hwang Wai Keen
Juss Bin Mohamad
Dato’ Lee Choon Chin
Robin Lo Bing
TA Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Law Kiing Kiu
Kenanga Nominees (Tempatan) Sdn. Bhd.
Pledged securities account for Law Kiing Kiu
No. of Shares
% of shareholdings
7,001,000
12.08
5,800,000
10.01
5,100,000
8.80
4,400,000
7.59
2,750,000
4.74
2,447,900
2,304,000
4.22
3.98
1,600,000
2.76
1,465,000
2.53
1,200,000
2.07
1,157,000
1,100,000
748,000
704,000
641,000
2.00
1.90
1.29
1.21
1.11
625,300
567,594
1.08
0.98
525,000
0.91
520,000
0.90
456,600
400,000
0.79
0.69
400,000
0.69
350,000
350,000
332,000
300,000
296,998
272,405
0.60
0.60
0.57
0.52
0.51
0.47
221,200
0.38
188,500
0.33
>> 81
Incorporated In Malaysia <<
List of Properties - as at 31 January 2005
>> 82
Address
Brief Description
Existing use
Tenure &
Expiry Date
Age of
Buildings
Net Book
Value(RM)
Date of last
revaluation/acquisition
Lot 27, Blk 4 Muara Tebas
Land District.
Industrial land &
factory building of
approx. 6.0620 hectares
Factory
Leasehold
2027
5
9,281,135
Land acquired on
24.4.1997. Building
completed on 26.7.1999
Lot 1355, Blk 3
Miri Concession
Land District
Industrial Zone
Land 1.4081
hectares
Site workshop
& laboratory
Leasehold
2047
5 & 14
3,115,975
Land acquired on
20.10.1997. Building
completed in 1990 & 1999
Lot 2160, Section 66
KTLD, Pending Industrial
Estate (Formerly known
as plot 2 of Lot 648)
Land & buildings
of approx.
7.233 sq. metres
Site office,
store &
workshop
Leasehold
2059
9
20,765
Land acquisition
completed on
20.10.1999. Building
completed in 1996
Industrial Lot#103,
Tanjung Manis
Timber processing zone
Industrial land
of approx. 1.6637
hectares
Vacant
Leasehold
60 years from
title issue
7
704,817
Land acquired
in 1997
Sublot 1006 of
Lots 45, Blk 10
Miri Concession
Land District
Three-Storey
commercial shophouse
of approx. 136.8
sq. metres
Vacant
Leasehold
2059
11
420,000
Building acquired
in 1993
No. 8, Level 10
Chonglin Plaza,
Kuching
1 unit Condominium
of approx. 1,226 sq.
feet
Staff usage
Leasehold 60
years from
title issue
6
82,000
Building acquired
on 9.12.1999
Sibujaya low cost
housing, 27 kilometre,
Durin Road, Sibu
Site office, store
& laboratory
Site office, store
& laboratory
-
11
-
Office completed
in 1993
Lot 553, Jalan Limpaki,
Limbang
Site office, workshop
& store
Site office, store
& workshop
-
4
7,770
Store completed in 2000
Lot 60, Jalan Ting Lik
Kwong, Sibu
Plant office, laboratory
& cement store
Plant office, store
& laboratory
-
4
26,762
Building completed
in 2000
Lot 485, Blk 17,
Kota Samarahan
Plant office, laboratory
& cement store
Office, lab & store
-
3
18,140
Building completed
in 2001
Lot 847, Block 53,
Mukah Land District,
Mukah
Plant fencing
-
4
3,429
Building completed
in 2000
Plant fencing
List of Properties - as at 31 January 2005 (contd.)
Address
Brief Description
Existing use
Tenure &
Expiry Date
Age of
Buildings
Lot 368, Blk 53, Mukah
Land District, Mukah
Industrial land
of approx. 1.32 acre
Lot 602, Blk 20 Kemena
Land District Kidurong
Industrial Area, Bintulu
Plant office, laboratory,
cement store & worker
quarter approx.1.2142
hectares
Sublot 52, Polarwood estate
Lrg Lapangan Terbang 5,
Jalan Lapangan Terbang
Two storey
semi-detached house
422 sq. metres
Residential
Lot 706, Block 7, MTLD,
Sejingkat Industrial Park,
93050 Kuching
Industrial Land with
factory buildings of
approx. 6.980 hectares
M3-324,
Seniawan Sbrang, Bau
Mixed Zone Land of
approx. 2.934 hectares
Net Book
Value(RM)
Vacant
Leasehold 60 years
from title issue
1
338,240
Office, laboratory, Leasehold 60 years
store & worker
from title issue
quarter
3
1,093,665
Leasehold
60 years from
title issue
2
389,330
Factory &
staff quarter
2054
9
24,911,378
Vacant land
Leasehold
2034
4
122,476
Date of last
revaluation/acquisition
Land acquired
on 20.01.2003
Land acquired on
23.07.2001. Building
completed in 2002
Building acquired
on 28.06.2002
Land acquired on 2.4.1997
Buildings completed on
December 1997; New
extension completed in 2002;
Land & buildings revalued
on 28.10.1999
Land acquired
on 13.7.2000
>> 83
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QUALITY CONCRETE HOLDINGS BERHAD
[Company No. 378282-D]
Incorporated in Malaysia
FORM OF PROXY
No. of Shares Held :
I / We __________________________________________________________________ I/C No./ Company No.______________________
(full Name in Capital Letters)
Of _____________________________________________________________________________________________________________
(Full Address in Capital Letters)
Being a member/members of QUALITY CONCRETE HOLDINGS BERHAD hereby appoint
__________________________________________________________________________ I/C No. _____________________________
(Full Name)
Of _____________________________________________________________________________________________________________
or failing him/her, the Chairman of the meeting as my/our proxy to vote for me/us on my/our behalf, at the Annual General Meeting of the
Company to be held at the Room 209, 2nd Floor, Wisma Bukit Mata Kuching, Jalan Tunku Abdul Rahman, 93100 Kuching, Sarawak, on Friday,
15 July 2005 at 10:00 a.m. for the following purposes :NO.
RESOLUTION
1.
To receive and adopt the Audited Financial Statements and reports of Directors and Auditors for the financial
year ended 31 January 2005.
2.
To re-elect Mr Michael Ong Kee Tuan who is retiring in accordance with Article 67 of the Articles of Association
of the Company and is offering himself for re-election.
3.
To re-elect Mr Tiang Ching Kok who is retiring in accordance with Article 75 of the Articles of Association of the
Company and is offering himself for re-election.
4.
To re-elect Mr Robin Lo Bing who is retiring in accordance with Article 75 of the Articles of Association of the
Company and is offering himself for re-election.
5.
To approve Directors’ fees in respect of the financial year ended 31 January 2005.
6.
To re-appoint Messrs. Ernst & Young as Auditors and to authorise the Directors to fix their remuneration.
7.
To authorise Directors to allot and issue shares pursuant to Section 132D of the Companies Act, 1965
8.
Proposed Allocation of Share Options to Edmund Goh Chze Jin.
9.
Proposed Shareholders’ Mandate On Recurrent Related Party Transactions of A Revenue Or Trading Nature
with Lee Ling Construction & Development Sdn. Bhd.; Lee Ling Timber Sdn. Bhd.; BMK Development Sdn.
Bhd. and Lee Ling Shipping Sdn. Bhd.
10.
Proposed Shareholders’ Mandate On Recurrent Related Party Transactions of A Revenue Or Trading Nature
with Jurudaya Construction Sdn. Bhd. and Datuk Haji Mazelan Bin Bugo
11.
Proposed Shareholders’ Mandate On Recurrent Related Party Transactions of A Revenue Or Trading Nature with
Chung Maa Machinery Sdn. Bhd.
12.
Proposed Shareholders’ Mandate On Recurrent Related Party Transactions of A Revenue Or Trading Nature with
Pahaytc Sdn. Bhd.
13.
Proposed Shareholders’ Mandate On Recurrent Related Party Transactions of A Revenue Or Trading Nature with
Kumpulan Parabena Sdn. Bhd.
FOR
AGAINST
Dated this
....................................................
Signature of Shareholder(s)
вњЃ
Notes :
1.
A member entitled to attend and vote at the meeting is entitled to appoint a proxy or proxies to attend and vote in his/her place. A proxy
need not be a member of the Company. Where a holder appoints two or more proxies, he/she shall specify the proportion of his/her
shareholdings to be represented by each proxy.
2.
A corporation which is a member may by resolution of its directors authorise such person as it thinks fit to act as its representative at the
meeting pursuant to Section 147 of the Companies Act, 1965.
3.
The instrument appointing a proxy shall be in writing under the hand of the appointer or of his/her attorney, and the person so appointed
may attend and vote at the meeting at which the appointer is entitled to vote.
4.
The instrument appointing a proxy or representative must be deposited at the registered office, Room 209, 2nd Floor, Wisma Bukit Mata
Kuching, Jalan Tunku Abdul Rahman, 93100 Kuching, not less than forty-eight (48) hours before the time for holding the meeting.
Stamp
QUALITY CONCRETE HOLDINGS BERHAD
Room 209, 2nd Floor, Wisma Bukit Mata Kuching,
Jalan Tunku Abdul Rahman, 93100 Kuching, Sarawak.
Tel: 6082-206600 Fax: 6082-206607
QUALITY CONCRETE HOLDINGS BERHAD
REGISTERED & HEAD OFFICE
Room 209, 2nd Floor, Wisma Bukit Mata Kuching, Jalan Tunku Abdul Rahman,
93100 Kuching, Sarawak.
Tel: 6082-206600 Fax: 6082-206607
E-mail: [email protected]
(378282-D)

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