Professional Documents
Culture Documents
Goldis AR 2014
Goldis AR 2014
08 | Corporate Information
09 | Notice of The Fifteenth Annual
General Meeting
12 | Five-year Performance Highlights
OVERVIEW
The most significant change in the financial year ("FY") ended 31 December 2014
was the voluntary general offer made for the remaining shares in IGB Corporation
Berhad (“IGB”) not owned by Goldis Berhad (“Goldis”) at RM2.88 per share. The
offer documents were sent to all the shareholders of IGB on 3 October 2014 and
by the end of the offer period, on the final closing date on 6 November 2014, we
have 978,790,103 shares, representing approximately 73.32% of the issued and
paid-up capital of IGB, an increase of 40.68% from its previous shareholding of
32.64%.
The effect on the accounts of Goldis was reflected in the increase to profit
attributable to shareholders from 6 November to 31 December 2014 when IGB
was a 73.32% subsidiary. The effect on the balance sheet was an increase in Net
Assets (“NA”) from RM2.95 to RM3.15 per share.
To reduce the gearing of the Company, subsequent to the offer and after the FY, a
rights issue for RM455.7 million Redeemable Convertible Cumulative Preference
Shares (“RCPS”) at an issue price of RM1.00 each on the basis of 3 RCPS for
every 4 existing Ordinary Shares of RM1.00 each held in Goldis was called for and
fully subscribed on 6 February 2015. The RCPS were listed on 24 February 2015.
Total borrowings for the shares acquired as at the year end was RM1,564.1 million
which was subsequently reduced to RM1,004.1 million by early April 2015.
The current gearing of the Group is 0.83 but a substantial amount of the
consolidated debt of the Group is a long term loan and is taken by IGB Real Estate
Investment Trust (“REIT”) and is secured by its investment properties and cash
flows generated from the income of the investment properties. If the gearing were
computed based on the net debt of the Group divided by adjusted equity (adjusted
for the fair value of the investment properties of the Group), it would better reflect
the gearing of the Group resulting in the gearing of the Group to be only 0.33.
FINANCIAL PERFORMANCE
Dear Shareholders, The Group changed its financial year end from 31 January to 31 December at the
end of 2013. Therefore, last year’s accounts only reflected 11 months performance
and hence, was not comparable with the full 12 months numbers for FY 2014.
On behalf of the Board of Directors, For this FY, the revenue for the Group was RM1,289.0 million after incorporating
I am pleased to present the IGB Group’s revenue of RM1,173.8 million. The consolidated 12 months Profit
Before Tax (“PBT) for the Group was RM450.2 million after taking into account
Annual Report for the financial year IGB’s contribution of RM422.2 million.
ended 31 December 2014. Profit attributable to ordinary shareholders amounted to RM102.2 million or 16.93
sen per share.
In accordance with the exemption in MFRS 1, the Group has elected to adopt the
cost model for its hotel properties on transition to MFRS. Accordingly, the fair
value of the hotel property has been deemed as cost as at the date of transition.
The cumulative foreign currency translation reserve which was recognised as
translation difference on foreign operations as a separate component of equity
previously is now deemed to be nil as at the date of transition to MFRS 1.
MFRS 15 requires an entity to recognise revenue to depict promised goods or services and control to customers. The amount of revenue reflects the consideration to
which the entity expects to be entitled in exchange for those goods or services.
The transition from FRS to MFRS has resulted in a net transitioning effect of RM116.3 million on the Retained Earnings of the Group for the FY ended 31 December 2013.
a) Property Investment & Management, Retail segment represented by IGB REIT, the owner of Mid Valley Megamall and The Gardens Mall registered a segmental result of RM282.4
million.
b) Property Investment & Management, Commercial segment recorded a segmental result of RM103.1 million, out of which GTower Sdn Bhd had contributed RM34.0 million.
c) Property Development segment comprising major projects in Three28 Tun Razak apartments, G Residence Service apartments, Damai Residence and Park Manor registered a
segmental result of RM96.6 million for the year. During the FY, the property development segment recorded a reversal of write down of RM21.0 million in respect of the property
held at Labu.
d) Hotel segment recorded a segmental result of RM31.3 million for the year. During the FY, the Group’s decision to redevelop Pangkor Island Beach Resort Hotel, which is more
than 30 years old, resulted in a write-off of the hotel property and property, plant and equipment of RM43.8 million.
e) Construction segment consisting of a major construction work on Southkey Megamall registered a segmental result of RM6.5 million for the current FY.
f) Investment Holdings segment recorded a segmental result of RM13.5 million mainly from the gain on disposal of quoted shares in Malaysia.
g) Other operation segments which comprise project management service, education, information & communication technology, water treatment service and aquaculture, registered
a loss of RM11.5 million. The loss incurred was mainly due to the pre-opening expenses which was for the IGB International School in Sierramas.
h) Share of associates amounting to RM21.4 million was mainly from IGB’s investments in hotels under the St Giles brand in London, Heathrow, New York and Manila.
Net finance cost for the Group amounted to RM50.1 million for the FY.
to develop a mixed-use development on a 5.86 acre site fronting the Chao Phraya River in Bangkok at an investment cost of approximately RM65.6 million. The project has a
potential gross development value (“GDV”) of RM800.0 million.
interest in Blackfriars Limited by Black Pearl to participate in the proposed mixed-use development project in Blackfriars, London which will offer 1.5 million square feet (“sf”) of
gross floor area in the South Bank borough of Southwalk at an investment cost of approximately £57.1 million. The project has an estimated GDV of RM4.2 billion.
the brink of the Kuala Lumpur City Centre (“KLCC”) area. The development has a GDV of about RM62.0 million.
5-6 bedroom, family homes with built-ups of between 5,000 sf and 7,000 sf. Its completion is targeted for the end of 2015.
rooms, four office towers and one serviced apartment tower with 300 residential units together with a shopping mall offering 1.5 million sf of lettable area.
greater Klang Valley’s first to focus solely on full International Baccalaureate (“IB”) programmes to students at all grade levels and has been recognised as an IB World School
since October 2013. The school is a premier co-ed learning institution catering to children from Pre-kindergarten to Grade 12.
Construction had already been completed. The handover to buyers was in March 2015.
rooms taps into the growing leisure and business travellers market in Ipoh.
OUR PEOPLE
For the FY under review, the total manpower of Goldis Group stands at 3,318 which is inclusive of the IGB Group. The Board recognises that human capital is our greatest asset and
thus, we are constantly seeking ways to reward and retain talents. The welfare of staff is our priority. Hence, continuous nurturing, personal development and rewards are initiatives to
retain key talents whose contributions are important to the Group as well as to motivate employees to a greater level of commitment and enhance productivity.
BOARD SECRETARIES
Ms Chow Lai Ping
OF DIRECTORS Mr Leong Kok Chi
AUDITORS
PricewaterhouseCoopers
SOLICITORS
Jeyaratnam & Chong
DATE OF INCORPORATION
1 June 2000
WEBSITE
www.goldis.com
NOTICE IS HEREBY GIVEN that the Fifteenth Annual General Meeting of Goldis Berhad will be held at the Ampang Room, Mezzanine Floor, GTower, 199 Jalan Tun
Razak, 50400 Kuala Lumpur on Thursday, 28 May 2015 at 2.00 p.m. for the following purposes:
As Ordinary Business
1. To receive the audited financial statements for the financial year ended 31 December 2014 together with the Reports of the Directors Please refer to
and Auditors thereon. Explanatory Note A
2. To approve the payment of Directors’ fees of RM174,411 for the financial year ended 31 December 2014. Ordinary Resolution 1
3. To re-elect Ms Tan Lei Cheng who retires in accordance with Article 98 of the Articles of Association of the Company. Ordinary Resolution 2
4. To re-elect Encik Daud Mah bin Abdullah who retires in accordance with Article 98 of the Articles of Association of the Company. Ordinary Resolution 3
5. To re-elect Dato’ Seri Robert Tan Chung Meng who retires in accordance with Article 104 of the Articles of Association of the Ordinary Resolution 4
Company.
6. To re-elect Mr Lee Chaing Huat who retires in accordance with Article 104 of the Articles of Association of the Company. Ordinary Resolution 5
7. To re-elect Mr Daniel Yong Chen-I who retires in accordance with Article 104 of the Articles of Association of the Company. Ordinary Resolution 6
8. To re-appoint Messrs. PricewaterhouseCoopers as auditors and to authorise the Directors to fix their remuneration. Ordinary Resolution 7
As Special Business
To consider and if thought fit, to pass the following ordinary resolutions:
9. Re-Appointment of Director Pursuant to Section 129(6) of the Companies Act, 1965 Ordinary Resolution 8
That Datuk Tan Kim Leong, who retires pursuant to Section 129(6) of the Companies Act, 1965, be and is hereby re-appointed as a
Director of the Company to hold office until the conclusion of the next Annual General Meeting.
(b) That approval be and is hereby given to Encik Daud Mah bin Abdullah, who has served as an Independent Non-Executive Ordinary Resolution 10
Director of the Company for a cumulative term of more than nine (9) years, to continue to act as an Independent Non-Executive
Director of the Company in accordance with the Malaysian Code on Corporate Governance 2012.
12. Proposed Renewal of Shareholders’ Mandate for the Company to Purchase its Own Shares Ordinary Resolution 12
(“Proposed Share Buy-Back”)
That subject to the provisions under the Companies Act, 1965 (“Act”), the Companies Regulations 1966, the Memorandum and
Articles of Association of the Company, the Listing Requirements of Bursa Malaysia Securities Berhad (“Bursa Securities”) and the
approvals of all relevant authorities (if any), the Company be and is hereby authorised, to the extent permitted by law, to purchase
and/or hold such number of its own ordinary shares of RM1.00 each (“Goldis Shares”) as may be determined by the Directors of
the Company from time to time through Bursa Securities upon such terms and conditions as the Directors may deem fit and
expedient in the interest of the Company provided that the aggregate number of shares purchased pursuant to this resolution shall
not exceed ten per centum (10%) of the total issued and paid-up share capital of the Company at the time of purchase;
That the maximum amount of funds to be utilised for the purpose of the Proposed Share Buy-Back shall not exceed the
aggregate retained profits and/or share premium account of the Company;
That authority be and is hereby given to the Directors of the Company to decide at their discretion, as may be permitted and prescribed
by the Act and/or any prevailing laws, rules, regulations, orders, guidelines and requirements issued by the relevant authorities for
the time being in force to deal with any Goldis Shares so purchased by the Company in the following manner:
(b) to retain the Goldis Shares so purchased as treasury shares for distribution as dividends to the shareholders of the Company and/or
re-sell through Bursa Securities in accordance with the relevant rules of Bursa Securities and/or cancel the Goldis Shares so
purchased subsequently; or
(c) to retain part of the Goldis Shares so purchased as treasury shares and cancel the remainder.
That the authority conferred by this resolution will be effective immediately from the passing of this ordinary resolution until:
(a) the conclusion of the next Annual General Meeting of the Company following the Annual General Meeting at which this
resolution is passed, at which time the authority would lapse unless renewed by an ordinary resolution, either unconditionally
or conditionally; or
(b) the expiration of the period within which the next Annual General Meeting of the Company after that date is required by law to
be held; or
(c) the authority is revoked or varied by an ordinary resolution passed by the shareholders of the Company in a general meeting,
And that the Directors of the Company be and are hereby authorised to take such steps to give full effect to the Proposed Share
Buy-Back with full power to assent to any conditions, modifications, variations and/or amendments as may be imposed by the
relevant authorities and/or to do all such acts and things as the Directors may deem fit and expedient in the best interest of the
Company.
13. To transact any other business of which due notice shall have been given.
Kuala Lumpur
6 May 2015
Notes:
1. Only depositors whose names appear on the Record of Depository as at 21 May 2015 shall be entitled to attend, speak and vote at the meeting.
2. A member entitled to attend and vote at the meeting is entitled to appoint not more than two (2) proxies to attend and to vote in his stead. A proxy may but need not
be a member of the Company and the provision of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company.
3. Where a member appoints two (2) proxies, the appointment shall be invalid unless he specifies the proportion of his shareholdings to be represented by each proxy.
4. Where a member of the Company is an authorized nominee as defined under the Securities Industry (Central Depositories) Act 1991, it may appoint not more than
two (2) proxies in respect of each securities account it holds with ordinary shares of the Company standing to the credit of the said securities account.
5. Where a member of the Company is an exempt authorized nominee as defined under the Securities Industry (Central Depositories) Act 1991 which holds ordinary
shares in the Company for multiple beneficial owners in one (1) securities account (“omnibus account”), there is no limit to the number of proxies which the exempt
authorized nominee may appoint in respect of each omnibus account it holds.
6. The instrument appointing a proxy shall be in writing under the hand of the appointer or of his attorney duly authorized in writing or if the appointer is a corporation,
either under its common seal or under the hand of a duly authorized officer or attorney.
7. The Proxy Form shall be deposited at the Share Registrar of the Company, Tricor Investor Services Sdn Bhd, Level 17, The Gardens North Tower, Mid Valley City,
Lingkaran Syed Putra, 59200 Kuala Lumpur, not less than forty-eight (48) hours before the time appointed for holding the meeting.
Explanatory Note A
The Audited Financial Statements in Agenda 1 is meant for discussion pursuant to the provision of Section 169(1) of the Companies Act, 1965.
1. For proposed Ordinary Resolution 8, the re-appointment of Datuk Tan Kim Leong, a person over the age of seventy (70) years as a Director of the Company to hold
office until the conclusion of the next Annual General Meeting of the Company shall take effect if the proposed Ordinary Resolution has been passed by
a majority of not less than three-fourth (3/4) of such members as being entitled to vote in person or, where proxies are allowed, by proxy, at a general meeting
of which not less than twenty-one (21) days’ notice specifying the intention to propose the resolution has been duly given.
2. For proposed Ordinary Resolutions 9 and 10, the Board has assessed the independence of both Independent Non-Executive Directors, who have served for more
than nine (9) years and recommended them to continue to act as Independent Non-Executive Directors of the Company based on the following justifications:-
(a) During Board Meetings, Datuk Tan Kim Leong and Encik Daud Mah bin Abdullah are able to express their opinions free of concern of their positions and their
views are taken seriously, of which, without their approval, corporate proposals would not be carried out. The Board is of the opinion that it is the approach and
the attitude of the Independent Non-Executive Directors which is critical in determining their independent status.
(b) Datuk Tan Kim Leong and Encik Daud Mah bin Abdullah have performed their duties diligently and in the best interest of the Company by providing independent
and balanced assessment of proposals from the management.
(c) The Group has benefitted from these long serving Independent Directors who possess detailed knowledge of the business, Standard Operating Procedures,
internal controls and risk management of the Group.
3. The proposed Ordinary Resolution 11, if passed, will renew the mandate to empower the Directors to issue shares in the Company up to an amount not exceeding
in total ten per centum (10%) of the issued share capital of the Company for the time being, for such purposes as the Directors consider would be in the interest of
the Company in order to avoid any delay and costs involved in convening a general meeting to approve such an issue of shares. This authority, unless revoked or
varied at a general meeting, will expire at the next Annual General Meeting of the Company.
This mandate will provide flexibility to the Company for the allotment of shares for the purpose of funding working capital, future expansion, investment(s)/acquisition(s)
or such other purposes as the Directors consider would be in the interest of the Company.
As at the date of this Notice, no new shares in the Company were issued pursuant to the mandate granted to the Directors at the Fourteenth Annual General Meeting
held on 29 May 2014 and which will lapse at the conclusion of the Fifteenth Annual General Meeting.
4. The proposed Ordinary Resolution 12, if passed, will renew the shareholders’ mandate for the share buy-back by the Company and will empower the Company to
purchase and/or hold up to ten per centum (10%) of the issued and paid-up share capital of the Company. This authority will, unless revoked or varied by
the Company at a General Meeting, expire at the next Annual General Meeting. Further information on the Proposed Share Buy-Back is set out in the Statement to
Shareholders dated 6 May 2015, which is despatched together with the Annual Report of the Company.
5. Profiles of Directors standing for re-election and re-appointment are set out on pages 14 to 16 of the Annual Report; while details of their interest in securities are
set out on pages 159 and 162 of the Annual Report.
FRS10
Financial year/period ended Jan-2010* Jan-2011* Jan-2012* Jan-2013** Dec-2013^
RM’000 RM’000 RM’000 RM’000 RM’000
Tan Lei Cheng, aged 58, a Malaysian, was appointed a Director of Goldis Berhad (“the Company”) on 20 September 2000. She was appointed Executive Chairman and
Chief Executive Officer (“CEO”) of the Company on 6 May 2002. She was the CEO of Tan & Tan Developments Berhad (“Tan & Tan”) a property development company,
from March 1995 to August 2003. Tan & Tan is a public company listed on Bursa Malaysia Securities Berhad until the Company took over its listing on 8 May 2002,
following the completion of the merger between the Company, Tan & Tan and IGB Corporation Berhad ("IGB"). She is the prime mover in identifying and developing
projects that are in the growth industry sector. She has 33 years of experience in the property industry and the corporate sector. She holds a Bachelor of Commerce
from the University of Melbourne, Australia, and a Bachelor of Law from King’s College, London (LLB Hons). She is also a member of Lincoln’s Inn and was admitted to
the English Bar in 1983. She is a member of the World Presidents’ Organisation, Malaysia Chapter. She is a Director of IGB, KrisAssets Holdings Berhad (in liquidation),
Tan & Tan, Dato’ Tan Chin Nam Foundation and IGB REIT Management Sdn Bhd (the manager of IGB Real Estate Investment Trust) (“IGB REIT”).
She has no conflict of interest with the Company and has no conviction for offences within the past 10 years.
Datuk Tan Kim Leong @ Tan Chong Min, aged 75, a Malaysian, was appointed to the Board of the Company on 11 January 2002. He is a Fellow member of the Institute
of Chartered Accountants, Australia and the Malaysian Institute of Chartered Secretaries and Administrators. He holds professional memberships in the Malaysian
Institute of Accountants and the Malaysian Institute of Certified Public Accountants.
Other directorships in public companies include IOI Properties Group Berhad, Amoy Canning Corporation (Malaya) Berhad, Yayasan Bursa Malaysia, Ng Teck Fong
Foundation, Malaysia-China Business Council, KL Industrial Services Berhad and Gul Technologies Singapore Ltd.
He is the Senior Independent Director, Chairman of the Audit Committee and a member of the Nomination, Remuneration and ESOS Committees.
He has no conflict of interest with the Company and has no conviction for offences within the past 10 years.
Daud Mah Bin Abdullah @ Mah Siew Whye, aged 53, a Malaysian, was appointed a Director of the Company on 15 January 2003. He holds a Bachelor of Science
(Econs) degree from the London School of Economics and Political Science and a Masters in Business Administration majoring in Finance from Wharton School,
University of Pennsylvania. He is a member of the Institute of Chartered Accountants of England and Wales, and of the Malaysian Institute of Accountants.
His working experience commenced with Coopers & Lybrand, London from 1984 to 1989. After completing his Masters in Business Administration in 1992, he
returned to Malaysia to join The Boston Consulting Group. He left The Boston Consulting Group in 1995 and set up a boutique fund management company called
Kumpulan Sentiasa Cemerlang Sdn Bhd where he is a Director. He is also a Director of KSC Capital Berhad (in liquidation).
He is the Chairman of the Remuneration and ESOS Committees and a member of the Audit and Nomination Committees.
He has no conflict of interest with the Company and has no conviction for offences within the past 10 years.
Dato’ Seri Robert Tan Chung Meng, aged 62, a Malaysian, was appointed to the Board of the Company on 8 December 2014. He is the Group Managing Director of
IGB. Prior to that, he was the Joint Managing Director of IGB since 1995.
He has extensive experience in property development, hotel construction, retail design and development as well as corporate management with more than 30 years’
experience in the property industry. After studying Business Administration in the United Kingdom, he was attached to a Chartered Surveyor’s firm for a year. He also
developed a housing project in Central London before returning to Malaysia.
He has been involved in various development projects carried out by IGB Group, in particular Mid Valley City. From inception to the realisation of Mid Valley Megamall and
The Gardens Mall, he was actively involved in every stage of their developments. He is instrumental to the development and success of Mid Valley Megamall and The
Gardens Mall and more importantly, in retaining their positions as prime retail players amidst increasingly competitive retail landscape. Through his management and
leadership, Mid Valley Megamall and The Gardens Mall are now two of the most popular shopping malls in the Klang Valley, enjoying an almost full occupancy rate for
the past few years.
He is also the Non-Executive Chairman of Wah Seong Corporation Berhad, the Managing Director of IGB REIT Management Sdn Bhd (the manager of IGB REIT), a
Director of Tan & Tan and KrisAssets Holdings Berhad (in liquidation).
He has no conflict of interest with the Company and has no conviction for offences within the past 10 years.
Lee Chaing Huat, aged 61, a Malaysian, was appointed to the Board of the Company on 8 December 2014. He is a fellow member of the Association of Chartered
Certified Accountants, UK and a member of the Malaysian Institute of Accountants.
He started his career as an auditor in 1971 with Messrs. Hanafiah Raslan & Mohamad/Touche Ross, Malaysia before joining the financial sector in 1980. He has
wide banking experience having worked with several banks – The Chase Manhattan Bank, Kwong Yik Bank Berhad and thereafter RHB Bank Berhad when Kwong Yik
Bank merged with DCB Bank Berhad in 1997.
In 2004, he joined Hong Leong Credit Berhad as Group Chief Financial Officer and later joined Hong Leong Bank Berhad as Chief Operating Officer/Head of Business
Banking Division. Thereafter, in December 2005, he started his own private management consultancy company.
Other directorships in public companies include Sentoria Group Berhad and MBF Holdings Berhad.
He is the Chairman of the Nomination Committee and a member of the Audit and Remuneration Committees.
He has no conflict of interest with the Company and has no conviction for offences within the past 10 years.
Tan Boon Lee, aged 51, a Malaysian, was appointed a Director of the Company on 11 January 2002. He holds a Bachelor of Economics from Monash University, Australia
and a Masters in Business Administration from Cranfield School of Management, United Kingdom. He has 27 years of experience in the property and hotel industry, giving
management and technical assistance to hotel and hospitality projects in Malaysia and Asia. He is a director of IGB, KrisAssets Holdings Berhad (in liquidation), Tan &
Tan, SW Homeowners Berhad, Dato’ Tan Chin Nam Foundation and IGB REIT Management Sdn Bhd (the manager of IGB REIT).
He has no conflict of interest with the Company and has no conviction for offences within the past 10 years.
Daniel Yong Chen-I, aged 43, a Malaysian, was appointed to the Board of the Company on 8 December 2014. Prior to his appointment to the Board of the Company, he
was an Alternate Director to Pauline Tan Suat Ming for the period from 10 July 2014 to 8 December 2014. He is the Executive Director and the Joint Chief Operating
Officer (Mid Valley Megamall) of the IGB REIT Management Sdn Bhd (the manager of IGB REIT).
He is a law graduate from the University of Bristol, England. He joined Mid Valley City Sdn Bhd (“MVC”) in 1999 as a member of the pre-opening retail development
team. He was appointed an Executive Director of MVC in 2003 and is responsible for overseeing the management and operations of Mid Valley Megamall since. He
was also involved in the design and pre-opening of The Gardens Mall from 2004 to 2007. His prior work experience includes the development of bespoke systems
with BYG Systems Ltd in England and Operational Management with Wah Seong Engineering Sdn Bhd, the distributor and manufacturer for Toshiba Elevator and Escalator
in Malaysia.
He is a Director of IGB REIT Management Sdn Bhd (the manager of IGB REIT), KrisAssets Holdings Berhad (in liquidation) and an Alternate Director to Pauline Tan Suat
Ming on the Boards of IGB and Wah Seong Corporation Berhad.
He has no conflict of interest with the Company and has no conviction for offences within the past 10 years.
Tan Mei Sian, aged 31, a Malaysian was appointed an Alternate Director to Tan Boon Lee on 5 February 2013. She graduated from the London School of Economics
and Political Science with a Bachelor of Science in Economics. She is the Director of Corporate and Investments of Goldis Berhad, focusing on food and healthcare.
She is the Chairman of Master Games International, Deputy Chairman of the Konzen Group, Managing Director of Home Nursing Providers, and a Director of The Bean
Hive. She is an Alternate Director to Tan Lei Cheng on the Board of Tan & Tan.
She was previously an Engagement Manager at Oliver Wyman, specialising in financial services and risk management consulting, having worked with major financial
institutions in the United States, United Kingdom, Netherlands, China, Taiwan, Hong Kong, Singapore, Malaysia, Thailand and Australia. She is a member of the Young
Presidents' Organisation (YPO), Entrepreneurs’ Organisation (EO), and Family Business Network (FBN).
She has no conflict of interest with the Company and has no conviction for offences within the past 10 years.
Family Relationship
Save for Tan Lei Cheng, Dato’ Seri Robert Tan Chung Meng, Tan Boon Lee, Daniel Yong Chen-I and Tan Mei Sian, the rest of the Directors have no relationship with any
Director and/or major shareholder of the Company.
Goldis Berhad (“Goldis” or "the Company") and its Board of Directors (“the Board”) recognize and value the standards of corporate governance that are essential in
the running and management of business to create sustained profitability and enhance shareholders’ value.
The Board has endeavoured to ensure the Principles and Recommendations as set out in the Malaysian Code of Corporate Governance 2012 (“MCCG 2012”) are
observed throughout the Group.
In this Statement, the Board reports on the manner in which the Group had adopted and applied the Principles and Recommendations as set out in the MCCG 2012
throughout the year under review.
The Board
The Board is collectively responsible for the long term success of the Group. The Board is guided by a Board Charter which sets out the roles, functions,
composition and responsibilities of the Board. It acts as a source of reference and primary induction literature for prospective Board members. The Board will
consistently review the Board Charter to ensure it remains consistent with the Board’s objectives and responsibilities, and all the relevant standards of corporate
governance. The Board Charter is available to shareholders for review upon request in writing submitted to the Company.
Goldis has adopted and documented a schedule of matters specifically reserved for the Board’s approval.
Goldis is committed to operating in a sustainable manner and has adopted a Sustainable Policy. Details of the Corporate Social Responsibilities activities
undertaken by the Group are furnished in the Corporate Social Responsibility Statement.
Following the completion of the take-over exercise of IGB Corporation Berhad (“IGB”) by Goldis in November 2014, IGB has become a major subsidiary of
Goldis. In this respect, the Board of Goldis will rely on the Board of IGB, a public listed company with its own internal controls systems and Standard Operating
Procedures (“SOPs”) to oversee the application and oversight of risk management and controls, internal audit, corporate governance and Directors’ and Board
Committees' duties and responsibilities.
The Board comprises seven (7) members, of whom four (4) are Executive Directors and three (3) are Independent Directors. There is an Alternate Director on
the Board. The composition of the Board complies with the prescribed requirements for one-third (1/3) of the membership of the Board to be Independent Board
Members. The Board is satisfied that its existing size and composition are adequate to provide for a diversity of views, with an appropriate balance of executive
and independent directors. A brief profile of each Director is presented in the Profile of the Board of Directors.
The Board recognizes the policy of Boardroom diversity in terms of gender, age and ethnicity. Our Board has both male and female representations and the
required collective skills, experience and expertise contributed by Directors between the ages of 30 to 75. They come from diverse background, bringing a
wealth of experience and leadership qualities. Most importantly, it does not practise any discrimination of any form, whether based on marital status, sexual
orientation, race, origin, religion, religious beliefs, political opinion or disability.
Taking into account the size, scope and business nature of the Company, the positions of the Chief Executive Officer (“CEO”) and the Chairman of the Company
are held by the same person. The CEO is responsible for managing the CEOs and leaders of the various subsidiaries who manage the day to day management of
the subsidiaries as well as developing, meeting and implementing the corporate strategies and objectives of the Company. The function of the Chairman that is
currently held by the CEO is to ensure the orderly conduct and working of the Board, the management of the business and the translation of Board’s decision into
executive action. Although the positions are held by the same Board member, no individual may dominate the Board on decision-making. An open environment
is encouraged for debate and ensures the Non-Executive Directors are able to speak freely and contribute effectively.
Although the Board does not comprise a majority of Independent Directors, it has a high proportion of Independent Directors. All the Directors exercise a high
duty of due care with respect to the matters which they consider and bring objective judgement to bear in decision making. The Independent Directors are
independent of executive management and free of any business relationship that could materially interfere with the exercise of unfettered and independent
judgement that could compromise their ability to act in the best interests of the Company. They have the capacity to fully deliberate and examine strategies
proposed by management, therefore safeguarding the interests of the stakeholders.
The Board has appointed Datuk Tan Kim Leong as the Senior Independent Non-Executive Director to whom any concerns pertaining to the Group may be
conveyed.
The Board is scheduled to meet quarterly with additional meetings to be convened when urgent matters need to be discussed and approved between these
scheduled meetings. Board meetings are scheduled in advance before the end of each financial year so as to enable the Directors to plan accordingly and fit the
year’s Board meetings into their respective schedules. Management is invited to brief and report in meetings of the Board and Committees. Informal meetings are
held for management to brief Directors on prospective deals and potential developments in the early stages.
Board papers are circulated electronically and in hard copies before the meeting. Any additional material or information requested by Directors is promptly
furnished. All deliberations, discussions and decisions including dissenting views are minuted and recorded accordingly. Minutes of Board meeting are circulated
to all Directors for their perusal prior to confirmation at the following Board meeting. The Directors may request for further clarification or raise comments prior to
confirmation of the minutes as a correct record of proceedings of the Board. Where the Board is considering a matter which a Director has an interest, the interested
Director will disclose his interest and abstain from participating in any discussion or voting on the subject matter. In the event a corporate proposal is required to be
approved by shareholders, the interested Director will abstain from voting in respect of his/her shareholdings on the resolution relating to the corporate proposal
and will undertake to ensure that persons connected abstain from voting as well.
During the financial year ended 31 December 2014, the Board held seven (7) meetings. Individual attendance at these meetings is set out in the table below:-
The Board is satisfied with the level of time commitment given by the Directors towards fulfilling their roles and responsibilities as Directors of the Company. This
is evidenced by the attendance record of the Directors at the Board Meetings as set out in the table above. None of the Board members hold more than five (5)
directorships in listed issuers, thus ensuring their commitments, resources and time are focused on the affairs of the Group.
All Board members shall notify the Chairman of the Board before accepting any new directorships in any other organization. The new directorships would not
unduly affect their time commitments and responsibilities to the Board.
The Directors have unrestricted access to information pertaining to the business and affairs of the Group to enable them to discharge their duties effectively.
All Directors have access to further information which they may require in discharging their duties including seeking independent professional advice where
necessary at the expense of the Company. This information includes both verbal and written details. The Directors have access to the advice and services of the
Company Secretaries who facilitate overall compliance with the Main Market Listing Requirements (“MMLR”), Companies Act, 1965 and other relevant laws and
regulations, advise the Board on all governance issues and ensure the Directors are provided with relevant information on a timely basis for decision making.
Thus, the Board, with the support of the Company Secretaries, monitors developments in corporate governance, statutory and regulatory requirements relating to
Directors’ duties and responsibilities.
The Directors continue to adhere to the Directors’ Code of Ethics established by the Companies Commission of Malaysia. The Code of Ethics is available to
shareholders for review upon request in writing submitted to the Company.
In line with good governance and transparency, a Whistle-Blowing Policy was adopted by the Company to report concerns relating to illegal, unethical or improper
conduct in circumstances where employees and the public may be apprehensive about raising their concerns due to fear of possible adverse repercussions. The
policy enables staff to raise concerns openly and locally. The policy is available on the website of the Company.
Pursuant to Section 129 (6) of the Companies Act, 1965, Directors who are or over the age of seventy (70) years shall retire at every Annual General Meeting
(“AGM”) and may offer themselves for re-appointment to hold office until the next AGM.
In accordance with the Articles of Association of the Company, all Directors retire from office at least once in every three (3) years and offer themselves for re-
election. The election of each Director is voted on separately. The Executive Directors also rank for re-election by rotation. Re-election of Directors provides an
opportunity for shareholders to renew their mandate conferred to the Directors.
Any person appointed as a Director, either to fill a casual vacancy or as an addition to the existing Directors shall hold office only until the conclusion of the next
AGM, and shall be eligible for re-election but shall not be taken into account in determining the directors who are to retire by rotation at that meeting.
In accordance to the MCCG 2012, an Independent Non-Executive Director can remain as Independent Director after serving a cumulative term of nine (9) years
provided that the Board justifies and seeks shareholders’ approval in a general meeting.
The Director standing for re-appointment under Section 129 (6) of the Companies Act, 1965 is Datuk Tan Kim Leong whilst the Directors who are due for retirement
by rotation and eligible for re-election pursuant to Article 98 of the Articles of Association of the Company are Ms Tan Lei Cheng and Encik Daud Mah bin Abdullah.
The Directors who are appointed by the Board during the financial year before the AGM who are subject to re-election under casual vacancy are Dato’ Seri Robert
Tan Chung Meng, Mr Lee Chaing Huat and Mr Daniel Yong Chen-I. The Independent Directors who have served beyond nine (9) years under the MCCG 2012 are
Datuk Tan Kim Leong and Encik Daud Mah bin Abdullah.
The Board has considered the assessment of the respective Directors standing for re-appointment and re-election and collectively agrees that they meet the criteria
of character, experience, integrity, competence, time and independence to effectively discharge their respective roles.
The objective of the policy of the Company on Directors’ remuneration is to attract and retain the Directors of the calibre needed to run the Group successfully.
In the case of Executive Directors, the component parts of the remuneration are structured so as to link rewards to corporate and individual performance.
The Remuneration Committee recommends to the Board the framework of the CEO’s remuneration and the remuneration package in all its forms, drawing
from outside advice where necessary. The remuneration of the CEO consists of basic salary and other emoluments. Salary review takes into account the
performance of the individual and the Group. However, the determination of remuneration packages of all Directors is a matter of the Board as a whole.
The Directors are paid annual fees which are approved annually by the shareholders. The Directors are also reimbursed reasonable expenses incurred by
them in the course of carrying out their duties on behalf of the Company.
Each individual Director abstains from the Board decision on his own remuneration package.
The aggregate remuneration of Directors categorised into appropriate components for the financial year ended 31 December 2014 is as follows:-
The aggregate remuneration of Directors analysed into bands for the financial year ended 31 December 2014 is as follows:-
The Company Secretary keeps the Directors informed of relevant external training programmes. Meanwhile, the Directors are empowered by the Board to assess
their own individual training needs and are encouraged to participate in external training programmes which they individually consider as useful in discharging
their responsibilities. The Company Secretary maintains a complete record of all the trainings attended by the Directors.
All the Directors have attended and successfully completed the Mandatory Accreditation Programme (“MAP”) as prescribed by the MMLR. The newly appointed
Directors completed the MAP when they were first appointed as directors of listed issuers.
The training programmes and seminars attended by the Directors during the financial year ended 31 December 2014 are set out below:-
Courses:-
Our Independent Director, Mr Lee Chaing Huat had given a number of trainings during the financial year under review such as Credit Management Workshop,
Corporate Relationship Management, Risks Analysis, Loan Structuring and Account Sourcing amongst others.
Board Committees assist the Directors in the discharge of their duties and responsibilities. All Committees operate under Board approved terms of reference, which
may be updated from time to time to keep abreast with developments in law and best practices in Corporate Governance. The Board has established four (4) Board
Committees, namely the Audit Committee, Nomination Committee, Remuneration Committee and ESOS Committee.
The Nomination Committee comprises exclusively of Independent Directors. Although the Chairman of the Nomination Committee is not the Senior Independent
Non-Executive Director, the Nomination Committee is able to perform its duties transparently and independently with the whole of its members being Independent
Directors. The Nomination Committee’s primary function is to consider and propose new nominees on the Board based on their skills, knowledge, expertise,
experience, professionalism and integrity. The Nomination Committee also assesses Directors on an on-going basis and proposes re-election and re-appointment
of Directors seeking re-election at the AGM. The actual decision as to who shall be nominated is the responsibility of the full Board after considering the
recommendations of the Nomination Committee.
Meetings of the Nomination Committee are held as and when required and at least once a year. The Nomination Committee met twice during the financial year.
The Nomination Committee had undertaken an annual review of the required mix of skills, diversity (gender diversity is fulfilled with the presence of one (1)
female Director serving as the CEO and one (1) female Alternate Director), level of independence demonstrated by the Independent Directors, experience and other
qualities, such as core competencies which the Directors need to bring to the Board which includes the performance of the Board as a whole, individual Directors
(including the CEO), Chief Financial Officer, Independent Directors, Board Committees and Audit Committee members. The annual assessment is coordinated
by the Company Secretary who facilitates the Nomination Committee by distributing the questionnaires to the Committee members for assessment, collating the
questionnaires and tabulating the rating. The overall findings are communicated to the Nomination Committee for its consideration and action. All assessments
and evaluations carried out by the Nomination Committee in the discharge of all its functions are documented.
There were three (3) new appointments to the Board for the financial year under review i.e. Dato’ Seri Robert Tan Chung Meng and Mr Daniel Yong Chen-I who were
appointed as Executive Directors and Mr Lee Chaing Huat who was appointed as an Independent Director. The appointments were deliberated by the Committee
based on a formal paper prepared by the Nomination Committee on the background, qualification and experience of the proposed Directors. Mr Tan Boon Lee, our
Non-Executive Director who sits on the Board of IGB, was re-designated as an Executive Director following the successful take-over of IGB.
The Committee and the Board would like to retain Datuk Tan Kim Leong and Encik Daud Mah bin Abdullah (who have served as Independent Non-Executive
Directors beyond nine (9) years) on the Board as Independent Non-Executive Directors as the Committee and Board are satisfied with their independence based
on the following justifications:-
views are taken seriously, of which, without their approval, corporate proposals would not be carried out. The Board is of the opinion that it is the approach
and the attitude of the Independent Non-Executive Directors which is critical in determining their independent status.
The Remuneration Committee comprises mainly of Non-Executive Directors. The Remuneration Committee’s primary function is to set the policy framework and
recommend to the Board the remuneration packages and benefits extended to the Directors, drawing from outside advice where necessary. The determination of
the remuneration package for Directors is a matter of the Board as a whole. The Director concerned abstains from deliberations and voting on decisions in respect
of his/her individual remuneration package.
The Remuneration of Directors, in aggregation and analysed into bands of RM50,000.00 is disclosed in the Corporate Governance Statement. The Board views that
the transparency in respect of Directors’ remuneration has been dealt with by the disclosure.
Meetings of the Remuneration Committee are held as and when required and at least once a year. During the financial year, the Remuneration Committee met once.
Amongst the items deliberated by the Remuneration Committee in 2014 were the Directors’ fees, annual bonus and salary increment of the employees and the
remuneration of the Chairman/CEO.
The ESOS Committee’s primary function is to administer the Employees’ Share Option Scheme in accordance with the Bye-Laws. There were no meetings held
during the financial year as the Scheme had expired on 19 May 2012.
Goldis is committed in ensuring that shareholders and the market are provided with full and timely information and that all stakeholders have equal opportunities to
receive information issued by Goldis.
To promote more efficient and effective ways to communicate with its stakeholders, the Board has leveraged on information technology in line with the Corporate
Disclosure Policy issued by Bursa Malaysia Securities Berhad (“Bursa Malaysia”) which was adopted by the Board. The Company has made available on its website,
http://www.goldis.com, its Annual Reports, quarterly results, announcements to Bursa Malaysia and press releases. Contact details are also provided on the website to
address any enquiries from the public.
Goldis has an investor relations policy which promotes effective communication with shareholders and encourages participation at General Meetings. The policy is
available on the website of the Company.
The AGM is the prime forum of dialogue with shareholders. The notice of the AGM is issued at least twenty-one (21) days before the meeting, in line with the requirements
of Listing Requirements. The notice is also published in a leading English newspaper. Shareholders are given the opportunity to ask questions at the AGM. The Directors
and external auditors are available to provide responses to shareholders during these meetings. The Annual Report remains a key channel of communication with the
stakeholders of the Group. It contains the financial and operational review of the business of the Group, corporate information, financial statements and information on
the Audit Committee and the Board of Directors. At the last AGM of the Company, the resolutions put forth for shareholders’ approval were voted by a show of hands as
no substantive resolutions were put forth for shareholders’ approval.
The Directors are responsible for ensuring that financial statements are drawn up in accordance with the provisions of the Companies Act, 1965 and applicable
approved accounting standards in Malaysia. In presenting the financial statements, the Company used appropriate accounting policies which are consistently applied
and supported by reasonable and prudent judgements and estimates. The Directors also ensure that the financial statements present a fair and understandable
The Company practises an internal compliance framework in identifying and assessing related party transactions. The Board, through the Audit Committee reviews
all related party transactions. A Director who has an interest in a transaction must abstain from deliberation and voting on the relevant resolution in respect of such
transaction.
The Board has overall responsibility for maintaining a sound system of internal controls and risk management to safeguard shareholders’ investment and the assets
of the Group. The Statement of Risk Management and Internal Controls is set out on pages 26 to 28 of this Annual Report providing an overview of the state of
internal controls within the Group.
The Board has established a formal and transparent professional relationship with the auditors of the Group through the Audit Committee. The auditors are invited
to attend Audit Committee Meetings at least twice a year without executive Board members present and will highlight to the Audit Committee significant matters
requiring deliberation and attention.
The Audit Committee has been accorded the power to communicate directly with both the external auditors and the internal auditors.
Share Buy-Back
The Company had on 29 May 2014 obtained its shareholders’ approval at the AGM to buy back shares of the Company. However, the Company has not conducted any
share buy-back for the financial year ended 31 December 2014. A total of 17,695,933 treasury shares were distributed as share dividend in the month of March 2014. As
at the financial year ended 31 December 2014, a total of 2,858,020 shares were retained as treasury shares.
There were no sanctions and/or penalties imposed on the Company, its subsidiaries, Directors and management by the relevant regulatory bodies which have material
impact on the operations or financial position of the Group during the financial year.
Non-Audit Fees
Non-audit fees amounting to RM249,040.00 was paid to the corporation affiliated to the external auditors for the services rendered for the financial year ended 31
December 2014.
Material Contracts
Other than disclosed in Note 41 of the Financial Statements, there were no other material contracts entered into by the Company and/or its subsidiaries which involved
Directors’ or major shareholders’ interests either still subsisting at the end of the financial year ended 31 December 2014 or which were entered into since the end of the
previous financial period.
This statement was made in accordance with the resolution of the Board of Directors passed on 17 February 2015.
The Directors are responsible for ensuring that the financial statements give a true and fair view of the state of affairs of the Group and Company as at 31 December 2014
and of the results and cash flows of the Group and Company for the financial year ended on that date.
The Directors are pleased to announce that in preparing the financial statements for the financial year ended 31 December 2014, the Group has:
The Directors are also responsible for ensuring that the Group and Company keep proper accounting records. In addition, the Directors have overall responsibilities
for the proper safeguarding of the assets of the Group and Company and taking such reasonable steps for the prevention and detection of fraud and other irregularities.
This statement was made in accordance with the resolution of the Board of Directors passed on 17 February 2015.
At Goldis Berhad (“Goldis”), we take pride in our strides as responsible corporate citizens to relentlessly incorporate our Corporate Social Responsibility (“CSR”) efforts
as part of our business strategy. We believe our responsibility extends beyond the statutory obligation to comply with legislation to voluntarily take action to improve the
quality of life amongst our employees and their families, local communities and society at large as well as to protect the environment.
EMPLOYEES
Goldis recognizes the value and importance of our employees and hence, recruiting, retaining, rewarding and developing the best talents in our organization are our
utmost priority.
We continually seek to improve and provide our human capital with opportunities for personal growth and fulfillment at work to foster teamwork, diversity and leadership.
We actively support a culture of development and performance to create positive working relationships and a flexible and balanced workplace.
We believe in creating a healthy work environment conducive for our employees to grow their skills indiscriminately. Training and development are integral part of
employees to grow and keep abreast with current knowledge and issues at hand. We also provide fair and equitable remuneration and comprehensive benefit packages.
Goldis recognizes the policy of workforce diversity and we seek to ensure there is no discrimination against employees or applicants on the basis on gender, age,
ethnicity, marital status, sexual orientation, race, origin, religion, religious beliefs, political opinion or disability. We do not employ or condone the employment of forced
or child labour. Our subsidiary, Macro Lynx Sdn Bhd (“Macro Lynx”) promotes job opportunities for people with disability to work alongside with us. Macro Lynx believes
disabled people should be given equal opportunity to work when they are ready and willing.
We encourage our workforce to keep fit and healthy. As an incentive, our subsidiary, Elements Gym Sdn Bhd offers gym membership at GTower at a special discount to
every employee. Macro Lynx also encourages employees to participate in sports and recreational activities like badminton.
We are dedicated to creating a workplace that is safe, fair and enriching. Safety procedures and programs are constantly monitored and improved to help ensure that our
employees work safely. Fire drills and fire safety briefings are also conducted periodically. Safety gears such as fire distinguishers and First Aid Kit boxes are within reach
in case of unforeseen circumstances or accidents.
We foster a workplace culture in which the rights, needs and unique contributions of each employee are respected. A motivated work force respected by management is
one the most effective means we have to create long term value for our shareholders and thus, is a competitive advantage for our Group. We also encourage and support
our employees in becoming involved in their communities by volunteering their time and talents to worthy causes.
ENVIRONMENT
In today’s environment where business is conducted regardless of the time of day, GTower owned by our subsidiary, GTower Sdn Bhd and designed for environmental
efficiency, is the first Malaysian building offering Grade A++ offices that integrates every working environment into a single hub.
We are constantly evaluating the way we build and manage our properties, looking for innovative ways to reduce our carbon footprint and minimize our impact on the
environment. Through sustainable building management, we are able to reduce demand for natural sources like energy and water. Natural light, appropriate lighting and
outside air management increased tenants’ satisfaction and created a more productive working experience. Tenants of GTower enjoy a whole range of both Green and
Smart hardware features designed into the very DNA of the building. As part of its efforts to educate the public on environmental issues, GTower also provides all its
tenants and patron useful Green Tips via Digital Signage System within its premise.
As a MSC status building, GTower also hosts a dedicated Data Centre facility with 24 hour IT Enquiry line, an Intelligent Building Management System which monitors
everything from environment quality to being linked with emergency services like police, fire brigade and ambulance.
In recognition of the initiatives of GTower in promoting sustainability and a “greener planet”, the Singapore Government’s Building and Construction Authority has
awarded GTower with a Green Mark Gold Certification. GTower has incorporated the latest Green Building Technology to achieve a better sustainable and low energy
environment.
We regard water as of vital importance, hence, we strive to play our part in protecting and preserving the ecosystem with safe and clean water. Safe drinking water is
essential to human and other life forms and sustenance of life.
Our investment in water and waste water treatment system in China via Crest Spring Pte Ltd has been awarded water concessions by the China Government. Crest Spring
builds, owns and operates water treatment plants in GanYu County (JiangSu province), Dajijia District, Yantai Economic and Technical Development Zone (Shandong
Province) and Zou Cheng, Jining City (Shandong Province). Waste water collected is treated and released back to the ecosystem, allowing such treated water to be
utilized for other purposes.
Undoubtedly, the practice at Goldis Group is to have the three R’s of waste management: Reduce, Re-Use and Recycle and such efforts are on going to promote a green
environment.
e-Cycle Campaign
“e-Cycle Campaign” is a compelling e-waste awareness, collection and donation campaign via GivingIsGold.org in collaboration with SOLS Tech. With this campaign,
GTower has become the e-waste collection hub. The collected items would be re-furbished by SOLS Tec first before being handed over to the charity homes and the needy.
COMMUNITY
We are constantly involved in supporting and being part of the local community to make a lasting positive impact.
In line with this initiative, Goldis together with our subsidiaries make contributions via GivingIsGold.org, a unique CSR program and the first online portal in Malaysia
that connects donors and charity homes. It was launched on 22 November 2012 by Dato’ Norani Bt Hj Mohd Hashim, Director General, Social Welfare Department of
Malaysia (http:///www.givingisgold.org). During the year, the Group has undertaken a number of meaningful CSR activities for the community.
Macro Lynx continues its CSR endeavours this year by providing for two (2) orphanages, namely Home of Peace and Rumah Kasih as well as an old folks home, Rumah
Jagaan dan Rawatan Al-Ikhlas. Home of Peace received mosquito netting for doors and windows whilst Rumah Kasih was given household items and stationery. Our
employees enjoyed themselves with fun-filled and caring activities with the orphans and old folks respectively. It is always heart-warming to lend support and be part of
their lives. It had simultaneously promoted unique learning experiences for the patron of the homes as well as our employees.
In recognizing efforts and initiatives made by Macro Lynx, numerous sponsors have stepped forward and gave their support to these CSR programs specifically Sonata
Vision Sdn Bhd which donated lunch boxes and a food blender, GTower Sdn Bhd which gave ironing boards and irons and also contributed the Aedes fogging. On top of
that, the vendors of Macro Lynx, Telepex Sdn Bhd and Amag Sdn Bhd supplied wall fans, ceiling fans and mooncakes specifically for the festive season.
Sonata Vision Sdn Bhd (“Sonato Vision”) also launched its own initiative, a “Dine for a Cause” campaign by donating its proceeds from selected menu to Sonata Vision’s
adopted charity home, Pusat Jagaan Nuri. In April 2014, Sonata Vision donated 5 units of steel wardrobe to Pusat Jagaan Nuri via GivingIsGold.org from its collection
from the “Dine for a Cause” campaign.
Elements Gym continues its efforts by driving two blood donation campaigns this year. In addition, a Charity Run, “GTower Charity Run 2014” was organized to raise
funds for Agathians Shelter, home to underprivileged children.
Education
Goldis continuously supports education through the Dato’ Tan Chin Nam Foundation where scholarships are offered to needy and deserving students to pursue tertiary
education in local universities, ultimately enriching the quality of lives in the communities through education.
MARKETPLACE
We ensure high standards of business ethics to be observed in all our business dealings. We conduct and build our business with mutual trust, honesty and integrity
respecting the rights and interest of both our valued customers and suppliers.
The Board recognises that a sound framework of risk management and internal controls is fundamental to good corporate governance to safeguard shareholders’
investment and the assets of the Group.
The Board affirms its overall responsibility for the effective governance, risk management and internal controls systems of the Group. This includes reviewing the risk
management framework, processes, responsibilities and assessing the adequacy and integrity of financial, operational, environmental and compliance controls.
In view of the limitations that are inherent in any internal controls system, a sound system of internal controls could only reduce, but cannot eliminate, the possibility of
poor judgement in decision-making, human error, control processes being deliberately circumvented by employees and others, management overriding controls, and
the occurrence of unforeseeable circumstances. It is structured in such a manner that it can only provide reasonable assurance that the likelihood of a significant adverse
impact on objectives arising from future event or situation is at a level acceptable to the business through a combination of preventive, detective and corrective measures.
The review of risk management and internal controls effectiveness only covers the operating units, subsidiaries and associated companies of the Group with the exception
of IGB Corporation Berhad, which has become a subsidiary of the Group on 6 November 2014. Since effective control of IGB Corporation Berhad has only taken place
very close to the financial year end, the Board of Goldis will continue to rely on the Board of this subsidiary, a public listed company with its own independent directors,
risk management and internal controls systems to perform the risk oversight role for the financial year.
The key senior management of Goldis Berhad are accountable to the Board for implementing and monitoring the system of risk management and internal controls
and for providing assurance to the Board that it has done so. Through regular performance review, the key senior management of Goldis Berhad believes that the risk
management and internal controls systems of the Group are operating adequately and effectively, in all material aspects, based on the risk management model adopted
by the Group.
RISK MANAGEMENT
The Board recognises its role and responsibilities on effective risk oversight to set the tone and culture towards effective risk management and internal controls. The
review process was delegated to the Audit Committee. However, the Board as a whole remains responsible for all the actions of the committee with regards to the
execution of the delegated role.
In order to ensure that the risk management and internal controls are embedded into the culture, processes and structure of the Group, the system of risk management
and internal controls was articulated with the following key elements.
The Group Risk Management framework and methodology, was approved and adopted by the Board. The framework and methodology has been communicated to the
senior management of all the subsidiaries of the Group through on-going training and facilitation from the Group Internal Audit department.
Each subsidiary of the Group has its own set of vision and mission statement, which defines the direction and goals of the company as well as the strategies and
objectives for achieving the goals. The mission statements had been clearly communicated to all levels of staff of the subsidiaries and are subject to review and update
on an annual basis by the top management and the Board of the Group.
Risk Attitude
Each subsidiary of the Group has a set of Risk Analysis Parameters which defines the amount of risk that the subsidiary is willing to seek or accept in pursuit of its
value. The Risk Analysis Parameters are set based on the vision and management risk appetite of the company and are measured in terms of likelihood and impact. The
parameters are subject to review and updates from time to time in response to the changes in the business environment.
Risk Analysis
There is an on-going process undertaken by management of each subsidiary to identify, assess, prioritise and manage significant risks relevant to the business of the
company and the achievement of objectives and strategies. The management is also responsible to implement and monitor the risk management framework in accordance
with the strategic vision, mission and overall risk appetite of the company. All risks will be rated in Gross (without taking into consideration the controls in place) and
Nett (after taking into consideration the controls in place) level in accordance to a Risk Analysis Matrix.
Each subsidiary maintains a register to record the result of its on-going risk analysis in a structured manner to facilitate monitoring and for review purposes. Key Risk
Register contains details of all key risks faced by the company, their rating, existing treatments (i.e. preventive, detective and corrective measures) as well as planned
treatments (i.e. Management Action Plan). A copy of the Key Risk Register will be kept by the Group Internal Audit for review, monitoring and reporting to the Audit
Committee.
On-going Assessment
Management reports regularly on the management of risks to the Chairman/Group Chief Executive Officer, whose main role is to assess, on behalf of the Board, the major
business risks faced by the Group and the adequacy of internal controls to manage those risks. Any significant changes in the business and the external environment
which may result in significant risks will be reported to the Audit Committee and Board accordingly. The Group Internal Audit department based on its regular reviews,
will report to the Audit Committee on subsidiaries’ discipline and effort in maintaining an effective system of internal controls on a quarterly basis.
Letter of Assurance
In addition to the on-going assessment of risk management and internal controls systems, on a quarterly basis, letters of assurance are provided by the subsidiaries that
are responsible for implementing the processes of risk analysis and internal controls, to assert that the processes are functioning in an effective manner.
Annual Assessment
Annually, subsidiaries are required to perform a review and update on the existing Key Risk Register to ensure the register does not leave out any significant risks that
may hinder the company from achieving its objectives and confirming that necessary actions have been or are being taken to manage those risks. The updated Key Risk
Register will be further reviewed by the Group Internal Audit before it is summarised and presented to the Audit Committee for deliberation and comment on the adequacy
and effectiveness of the Group risk management and internal controls systems.
Strategic risks are emerging high level external risks arising from unexpected adverse changes in the business environment of which its occurrence would result in the
destruction (or possibility total elimination) of shareholders' value in the company. It is imperative for management of all subsidiaries to perform analysis to identify the
risk of such nature and report to the Audit Committee and the Board for deliberation and comment on an annual basis.
Annually, the Group Internal Audit will perform risk management system maturity analysis on each subsidiary and report to the Audit Committee on the progress of
management efforts on embedding risk management and control framework into the culture, processes and structure of the company.
It is imperative for subsidiaries which initiate new investment proposal (e.g. joint venture, new subsidiary, project etc.) to perform risk analysis on the new investment
and submit together with all other analysis such as due diligences, SWOT analysis, market research, projection, business plan to the Group Investment Committee for
review and approval before submitting to the Group Chief Executive Officer and Board for approval.
The other key elements of the internal controls systems of the Group include:
The Group has an organisational structure which clearly defines the responsibilities and reporting lines including relevant authorisation levels.
Management Meetings
The Chairman/Group Chief Executive Officer meets periodically with the departmental heads of the Group to share information, monitor the progress of various business
units, and to deliberate and decide upon operational matters, and with the Chief Executive Officer of the respective business unit to review the business unit financial
performance, business development, management and corporate issues.
Budget
The Annual Budgets and revised Budgets are prepared by each operating company in the Group and are submitted to the Board for approval. It provides the Board with
comparative information to assess and monitor the performance of the Group.
Internal Audit
The Group Internal Audit department reports directly to the Audit Committee of the Group functionally to preserve the independence of the function. The internal audit
work is focused on areas of priority as identified by risk analysis in accordance with its annual audit plan as approved by the Audit Committee.
An internal control best practice has been established for key areas and has been distributed to each subsidiary for adoption. Each subsidiary will review and ensure that
the internal controls best practices are incorporated into their existing Standard Operating Procedures.
The Management Information Systems provide the Board with relevant and timely reports for monitoring the financial performance and the business operation of the
Group.
MONITORING
The Board reviews the effectiveness of the risk management and internal controls systems of the Group at periodic Board meetings and the risk management and internal
controls systems will continue to be reviewed, enhanced and updated in line with changes in the operating environment.
The Board is pleased to report that the risk management framework was functioning within levels appropriate to the Group businesses and there were no material internal
controls systems failures nor were there any reported weaknesses which resulted in material losses or contingencies for the year under review and up to the date of this
statement.
This statement was made in accordance with the resolution of the Board of Directors passed on 17 February 2015.
The Board is pleased to issue the following report on the Audit Committee and its activities during the financial year ended 31 December 2014.
COMPOSITION
Datuk Tan Kim Leong (Chairman) Senior Independent Non-Executive Director 5/5 100
A Objectives
(1) To ensure transparency, integrity and accountability of the activities of the Group so as to safeguard the rights and interests of the shareholders.
(2) To provide assistance to the Board in discharging its responsibilities relating to the management of principal risks, internal controls, financial reporting and
compliance with the statutory and legal requirements of the Group.
(3) To maintain regularly scheduled meetings, a direct line of communication between the Board, senior management, internal and external auditors.
B Membership
The Audit Committee shall be appointed by the Board from amongst its Directors and shall consist of not less than three (3) members, a majority of whom shall be
Independent Directors. All members of the Audit Committee should be Non-Executive Directors. If membership for any reason falls below three (3) members, the
Board shall within three (3) months of that event, appoint such number of new members as may be required to fulfil the minimum requirement.
(1) The members of the Audit Committee shall elect a chairman from among their number who shall be an Independent Director.
(3) All members should be financially literate and at least one (1) member of the Audit Committee:
(b) if he is not a member of the MIA, he must have at least three (3) years of working experience and have passed the examination specified in Part I of the
or
(d) at least seven (7) years of experience being a Chief Financial Officer of a corporation or having the function of being primarily responsible for the
management of the financial affairs of a corporation.
The Board must review the term of office and performance of the Audit Committee and each of the members at least once every three (3) years to determine whether
the Audit Committee and members have carried out their duties in accordance with the terms of reference.
C Authority
(2) Seek any information it requires from any employee and all employees are directed to co-operate with any request made by the Audit Committee.
(3) Obtain outside legal or other independent professional advice and to secure the attendance of outsiders with relevant experience and expertise if it considers
this necessary.
The Audit Committee shall have direct access to the internal and external auditors, who in turn, have access at all times to the Chairman of the Audit Committee.
The Audit Committee should meet with the external auditors without executive Board members present at least twice a year.
D Functions
(1) To review and discuss the following with the external auditors:
(e) their suitability and independence such as ensuring the provision of non-audit services would not impair the external auditors independence and
(b) the internal audit programme, processes and results of the internal audit programme, processes or investigation undertaken and ensure that appropriate
(3) To review the quarterly results and year end financial statements, prior to the submission to the Board for their approval, focusing particularly on:
(4) To review any related party transaction and conflict of interest situation that may arise within the Company or Group, including any transaction, procedure
(5) To consider and recommend the nomination and appointment, the audit fee and any questions of resignation, dismissal or re-appointment of the external
(6) To discuss problems and reservations arising from the interim and final audits and any matter the auditor may wish to discuss (in the absence of management,
(10) Where the Audit Committee is of the view that a matter reported by it to the Board has not been satisfactorily resolved resulting in a breach of Main Market
(12) To ensure adequate monitoring and review of the effectiveness of the systems established by management to identify, assess, manage and monitor the
(13) Such other functions as may be agreed to by the Audit Committee and the Board.
Meetings shall be held not less than four (4) times a year. The external auditors may request for a meeting and shall have the right to appear and be heard at any
meeting of the Audit Committee. The Audit Committee Chairman shall convene a meeting whenever any member of the Audit Committee requests for a meeting.
Written notice of the meeting together with the agenda shall be given to the members of the Audit Committee and the external auditors, where applicable.
The Chairman of the Audit Committee should engage on a continuous basis with senior management, such as the Chairman of the Board, Chief Executive Officer,
the Chief Financial Officer, the Head of Internal Audit and the external auditors in order to be kept informed of matters affecting the Company.
Members may, if they think fit, confer by radio, telephone, closed circuit television or other electronic means of audio or audio-visual communication and a
resolution or decision passed by such a conference will, despite the fact that the members are not present together in one place at the time of the conference, be
deemed to have been passed at the Audit Committee Meeting held on the day on which and at the time at which the conference was held. Any meeting held in such
manner shall be deemed to be held at such place as shall be agreed upon by the members attending the meeting provided that at least one (1) member present at
the meeting was at such place for the duration of the meeting.
The quorum for a meeting shall be two (2) provided always that the majority of members present must be Independent Directors and any decision shall be by a
simple majority. The Audit Committee Chairman shall have a casting vote in case of an equality of votes except where only two (2) Directors are competent to vote
on the question at issue.
The Chief Financial Officer, the Head of Internal Audit and a representative of the external auditors should normally attend meetings. Other Board members and
employees may attend meetings upon the invitation of the Audit Committee.
The Company Secretary shall be the Secretary of the Audit Committee and shall circulate the minutes of meeting of the Audit Committee to all members of the Board.
The Audit Committee has discharged its duties as set out in its Term of Reference. The major areas reviewed by the Audit Committee during the financial year ended 31
December 2014 were as follows:
(m) Reviewed and noted the Progress Reports of the Internal Audit Plan.
There was no allocation of options during the financial year ended 31 December 2014. The Employees’ Share Option Scheme had expired on 19 May 2012.
The Audit Committee is assisted by the in-house Group Internal Audit Department (GIAD) in discharging its duties and responsibilities. The GIAD function is considered
an integral part of the assurance framework and its primary mission is to provide assurance on the adequacy and effectiveness of the risk, control and governance
framework of the Group. The purpose, authority and responsibility of the GIAD function as well as the nature of the assurance and consultancy activities provided by the
department are articulated in the internal audit charter.
The GIAD reports directly to the Audit Committee who reviews and approves the annual audit plan, financial budget and human resource requirements to ensure that the
function is adequately resourced with competent and proficient internal auditors.
During the year, the GIAD conducted various internal audit engagements in accordance with the annual audit plan that is consistent with the goals of the Group. The GIAD
evaluates the adequacy and effectiveness of key controls in responding to risks within the organisation, governance, operations and information systems. The GIAD also
plays an active advisory role on risk analysis and control consultation.
The total cost incurred in managing the GIAD for the financial year ended 31 December 2014 was RM332,514.80.
The principal activities of the Company during the financial year are those of investment holding and the provision of management services.The principal activities
of the Group mainly consist of property investment and management, owner and operator of malls, hotel operations,property development, construction, information
and communication technology services, provision of engineering services for water treatment plants and related services, aquaculture, education, investment holding
and management of real estate investment trust.
The Company is a public limited liability company, incorporated and domiciled in Malaysia, and listed on the Main Market of Bursa Malaysia Securities Berhad (“Bursa
Malaysia”).
The address of the principal place of business and registered office of the Company is as follows:
FINANCIAL RESULTS
Group Company
RM’000 RM’000
Attributable to:
Owners of the parent 102,165 15,078
Non-controlling interests 245,244 -
347,409 15,078
DIVIDENDS
On 27 February 2014, as disclosed in the Directors report of that year, the Directors declared an interim dividend in respect of the financial period ended 31 December
2013 by way of distribution of tax exempt share dividend on the basis of three (3) treasury shares for every one hundred (100) existing shares of RM1.00 each on
14 March 2014. The share dividend involved the distribution of 17,695,933 treasury shares which were credited into the entitled Depositors’ Securities Accounts
on 27 March 2014.
The Directors did not recommend the payment of any final dividend for the financial year ended 31 December 2014.
All material transfers to or from reserves and provisions during the financial year have been disclosed in the financial statements.
SHARE CAPITAL
During the financial year, the Company increased its authorised share capital from RM1,000,000,000 comprising of 1,000,000,000 ordinary shares of RM1.00 each
to RM1,510,000,000 comprising of 1,500,000,000 ordinary shares of RM1.00 each and 1,000,000,000 Redeemable Convertible Cumulative Preference Shares
(“RCPS”) of RM0.01 each by the creation of an additional 500,000,000 ordinary shares of RM1.00 each and 1,000,000,000 RCPS of RM0.01 each.
TREASURY SHARES
In the current financial year, shareholders of the Company,by an ordinary resolution passed at the Annual General Meeting on 29 May 2014, approved the Company’s
plan to purchase its own shares up to a maximum of 10% of the issued and paid up capital of the Company. The Directors of the Company are committed to enhancing
the value of the Company to its shareholders and believe that the repurchase plan can be applied in the best interest of the Company and its shareholders.
During the financial year, the company has distributed tax exempt share dividend on the basis of three (3) treasury shares for every one hundred (100) existing shares
of RM1.00 each on 27 March 2014.
As at 31 December 2014, the number of outstanding ordinary shares in issue after the set off of treasury shares is 607,636,036 (31.12.2013: 589,940,103) ordinary
shares of RM1.00 each.
DIRECTORS
The Directors in office since the date of the last report are:
DIRECTORS’ BENEFITS
Since the end of the previous financial period, no Director has received or become entitled to receive a benefit (other than the fees and other emoluments paid as
disclosed in Note 10) by reason of a contract made by the Company or by a related corporation with the 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 41 to the financial statements.
Except as disclosed above, neither during nor at the end of the financial year was the Company a party to any arrangement whose object or objects was to enable the
Directors of the Company to acquire benefits by means of the acquisition of shares in, or debentures of, the Company or any other body corporate.
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 units in the Company and its
subsidiaries were as follows:
(subsidiary)
1.1.2014/Date
In IGB Corporation Berhad of appointment Additions Disposals 31.12.2014
(subsidiary)
1.1.2014/Date
In IGB Real Estate Investmen Trust (“IGB REIT”) of appointment Additions Disposals 31.12.2014
(subsidiary)
Other than as disclosed above, none of the Directors in office at the end of financial year held any interests in the shares in the Company or its related corporations
during the financial year.
Before the income statement, statement of comprehensive income and statement of financial position were made out, the Directors took reasonable steps:
(a) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of allowance for doubtful debts and satisfied themselves
that all known bad debts had been written off and that adequate allowance had been made for doubtful debts; and
(b) to ensure that any current assets, other than debts, which were unlikely to realise in the ordinary course of business their values as shown in the accounting
records of the Group and of the Company had been written down to an amount which they might be expected so to realise.
At the date of this report, the Directors are not aware of any circumstances:
(a) which would render the amounts written off for bad debts or the amount of the allowance for doubtful debts in the financial statements of the Group and of the
Company inadequate to any substantial extent; or
(b) which would render the values attributed to current assets in the financial statements of the Group and of the Company misleading; or
(c) 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.
(a) 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 liability of any other person; or
(b) any contingent liability of the Group or of the Company which has arisen since the end of the financial year.
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,
in the opinion of the Directors, will or may affect the ability of the Group or of the Company to meet their obligations when they fall due.
At the date of this report, the Directors are not aware of any circumstances not otherwise dealt with in this report or the financial statements which would render any
amount stated in the financial statements misleading.
(a) the results of the Group’s and of the Company’s operations during the financial year were not substantially affected by any item, transaction or event of a material
and unusual nature; and
(b) there has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual
nature 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.
On 18 July 2014, the Company had announced that it proposed to undertake a conditional take-over offer in accordance with the Malaysian Code on Take-Overs
and Mergers 2010 to acquire all the remaining ordinary shares of RM0.50 each in IGB which are not already owned by the Company (excluding treasury shares),
at an offer price of RM2.88 per Offer Share.
On 6 November 2014, subsequent the closure of the conditional take-over offer, the Company held in aggregate, 978,790,103 IGB shares, representing
approximately 73.32% of the issued and paid-up share capital of IGB (excluding treasury shares).
The acquisition of additional equity interest of 543,115,907 IGB shares was satisfied in full via cash of RM1,564,173,812.
On 23 December 2014, the proposed renounceable rights issue of up to 460.0 million new redeemable convertible cumulative preference shares with a par
value of RM0.01 each at an issue price of RM1.00 each (“RCPS”) was approved by the shareholders at the Extraordinary General Meeting of the Company. The
proceeds of the Rights Issue is to partially refinance the borrowings obtained in connection with the acquisition of an additional equity interest in IGB.
The entitlement basis of the RCPS is on 3 RCPS for every 4 existing ordinary shares of RM1.00 each in Goldis held on 20 January 2015.
On 12 February 2015, the Company had received valid and full subscription for a total of 455,727,027 RCPS at an issue price of RM1.00 each. The total
proceeds of the Right Issue amounted to RM455,727,027 is used to refinance the borrowings of the Company.
The RCPS was listed on the main Market of Bursa Malaysia Securities Berhad on 24 February 2015.
AUDITORS
The auditors, PricewaterhouseCoopers, have expressed their willingness to continue in office. The Directors had endorsed the recommendation of the Audit Committee
for PricewaterhouseCoopers to be reappointed as auditors.
Group Company
Restated
Financial 11 months Financial 11 months
year ended period ended year ended Period ended
Note 31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
Continuing operations
Revenue 7 1,288,979 1,114,871 16,937 73,212
Cost of sales (583,491) (475,797) - -
Profit for the financial year/period from continuing operations 347,409 304,779 15,078 70,454
Profit for the financial year/period from discontinued operations 6 - 20,278 - -
Attributable to:
Owners of the parent:
- continuing 102,165 80,389 15,078 70,454
- discontinued - 20,278 - -
102,165 100,667 15,078 70,454
Non-controlling interests 245,244 224,390 - -
16.93 17.17
The accompanying accounting policies and notes form an integral part of these financial statements.
Group Company
Restated
Financial 11 months Financial 11 months
year ended period ended year ended period ended
31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
Items that may be subsequently reclassified to profit or loss (4,323) 9,004 (7,895) (7,978)
Total comprehensive income for the financial year/period 343,086 334,061 7,183 62,476
Attributable to:
Owners of the parent 97,989 99,564
Non-controlling interests 245,097 234,497
97,989 99,564
The accompanying accounting policies and notes form an integral part of these financial statements.
Group Company
Restated Restated
Note 31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
ASSETS
NON-CURRENT ASSETS
Property, plant and equipment 14 2,197,353 2,035,739 1,838,802 307 299 337
Inventories 15 254,836 220,363 229,873 - - -
Investment properties 16 2,609,532 2,477,331 2,280,202 - - -
Long term prepaid lease 17 3,645 3,697 3,703 - - -
Intangible assets 18 19,608 19,720 19,540 - - -
Biological assets 19 331 460 647 - - -
Subsidiaries 20 - - - 2,453,975 798,119 783,089
Associates and joint ventures 21 824,690 387,723 355,631 - - -
Available-for-sale financial assets 22 12,638 9,857 50 12,588 9,807 -
Concession receivables 23 74,739 57,703 43,161 - - -
Deferred tax assets 24 103 103 5,893 - - -
CURRENT ASSETS
Group Company
Restated Restated
Note 31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
LIABILITIES
NON-CURRENT LIABILITIES
CURRENT LIABILITIES
Payables and contract liabilities 34 522,640 495,984 388,992 4,630 459 489
Advances from subsidiaries 37 - - - 1 26 26
Amount owing to associates 26 2,697 4,107 22,487 - - -
Financial guarantee contract 38 - - - - - 29
Current tax liabilities 115,348 69,802 59,215 - - -
Hire-purchase and finance lease payables 35 70 75 70 - - -
Interest bearing bank borrowings 36 2,317,903 263,288 362,851 1,545,120 - -
TOTAL EQUITY AND LIABILITIES 7,958,526 7,178,803 7,733,727 2,560,323 1,007,553 972,928
The accompanying accounting policies and notes form an integral part of these financial statements.
31.12.2014
At 1 January 2014 610,494 67,765 (41,147) 17,760 998,142 1,653,014 2,936,793 4,589,807
Comprehensive income
Profit for the financial year - - - - 102,165 102,165 245,244 347,409
Total comprehensive income for the financial year - - - (4,176) 102,165 97,989 245,097 343,086
Total transactions with owners - (35,425) 35,425 5,221 159,833 165,054 (1,930,670) (1,765,616)
At 31 December 2014 610,494 32,340 (5,722) 18,805 1,260,140 1,916,057 1,251,220 3,167,277
31.12.2013 (Restated)
At 1 February 2013
-as previously reported 610,494 103,221 (48,827) 186,886 694,729 1,546,503 3,510,460 5,056,963
-effects of transitioning to MFRS - - - (112,488) 113,157 669 2,552 3,221
Comprehensive income
Profit for the financial period - - - - 100,667 100,667 224,390 325,057
Total transactions with owners - (35,456) 7,680 - 34,054 6,278 (810,716) (804,438)
At 31 December 2013 (restated) 610,494 67,765 (41,147) 17,760 998,142 1,653,014 2,936,793 4,589,807
31.12.2014
Comprehensive income
Profit for the financial year - - - - 15,078 15,078
Other comprehensive income - - - (7,895) - (7,895)
Total comprehensive income for the financial year - - - (7,895) 15,078 7,183
31.12.2013
Comprehensive income
Profit for the financial period - - - - 70,454 70,454
Other comprehensive income - - - (7,978) - (7,978)
Total comprehensive income for the financial period - - - (7,978) 70,454 62,476
The accompanying accounting policies and notes form an integral part of these financial statements.
Group Company
11 months 11 months
Year ended period ended Year ended period ended
Note 31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
OPERATING ACTIVITIES
INVESTING ACTIVITIES
Group Company
11 months 11 months
Year ended period ended Year ended period ended
Note 31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
FINANCING ACTIVITIES
Cash and cash equivalentsat end of the financial year/period 28 744,980 1,061,428 72,083 88,283
Non-cash transactions
The principal non-cash transaction of the Group in financial year ended 31.12.2014 is:
1) The capitalisation of amounts due from associates of RM41,614,339 as a net investment in an associate.
A BASIS OF PREPARATION
The financial statements of the Group and of the Company have been prepared in accordance with Malaysian Financial Reporting Standards (“MFRS”),
International Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia.
The financial statements of the Group and of the Company for the financial year ended 31 December 2014 are the first set of financial statements prepared in
accordance with the MFRS, including MFRS 1‘First-time Adoption of Malaysian Financial Reporting Standards’. Subject to certain transition elections disclosed in
Note 44, the Group and the Company have consistently applied the same accounting policies in its opening MFRS statements of financial position at 1 February
2013 (transition date) and throughout all years presented, as if these policies had always been in effect. Comparative figures for 31 December 2013 in these
financial statements have been restated to give effect to these changes. Subsequent to the transition in the financial reporting framework to MFRS on 1 February
2013, the restated comparative information has not been audited under MFRS. However, the comparative statement of financial position as at 31 December
2013, comparative income statement, statement of comprehensive income, changes in equity and cash flows for the financial year then ended have been
audited under the previous financial reporting framework, Financial Reporting Standards in Malaysia. Note 44 discloses the impact of the transition to MFRS on
the Group’s and on the Company’s reported financial position, financial performance and cash flows.
The financial statements of the Group and of the Company have been prepared under the historical cost convention except as disclosed in this summary of
significant accounting policies.
The preparation of financial statements in conformity with MFRS requires the use of certain critical accounting estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of
revenues and expenses during the reported period. It also requires Directors to exercise their judgment in the process of applying the Group’s and the Company’s
accounting policies. Although these estimates and judgments are based on the Directors’ best knowledge of current events and actions, actual results may differ
from these estimates.
The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are
disclosed in Note 3.
(a) Standards, amendments and improvements to published standards and interpretations to existing standards that are effective and are applicable to the
Group and the Company.
The new accounting standards, amendments and improvements to published standards and interpretations that are effective for the Group’s and the
Company’s financial year beginning on or after 1 January 2014 are as follows:
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The new accounting standards, amendments to published standards and interpretations on the financial statements of the Group and of the Company do
not result in a significant change to the accounting policies and do not have a material impact on the financial statements of the Group and of the Company.
(b) Standards, amendments and improvements to published standards and interpretations to existing standards that are early adopted by the Group and the
Company
The new accounting standards, amendments and improvements to published standards and interpretations that are early adopted by the Group and the
Company are as follows:
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A summary of the impact of the new accounting standards, amendments to published standards and interpretations on the financial statements of the
Group and the Company is set out in Note 44.
(c) Standards, amendments and improvements to published standards and interpretations to existing standards that are applicable to the Group and the
Company but are not yet effective
The new standards, amendments and improvements to published standards and interpretations that are mandatory for the Group’s and the Company’s
financial year beginning on or after 1 January 2014 or later periods, and the Group and the Company has not early adopted, are as follows:
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Combination’ when it acquires an interest in a joint operation that constitutes a business. The amendments are applicable to both the acquisition
of the initial interest in a joint operation and the acquisition of additional interest in the same joint operation. However, a previously held interest is
not remeasured when the acquisition of an additional interest in the same joint operation results in retaining joint control.
The amendments to MFRS 138 also clarify that revenue is generally presumed to be an inappropriate basis for measuring the consumption of
the economic benefits embodied in an intangible asset. This presumption can be overcome only in the limited circumstances where the intangible
asset is expressed as a measure of revenue or where it can be demonstrated that revenue and the consumption of the economic benefits of the
intangible asset are highly correlated.
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contribution of assets between an investor and its associate or joint venture (effective from 1 January 2016) resolve a current inconsistency
between MFRS 10 and MFRS 128. The accounting treatment depends on whether the non-monetary assets sold or contributed to an associate or
joint venture constitute a ‘business’. Full gain or loss shall be recognised by the investor where the non-monetary assets constitute a ‘business’. If
the assets do not meet the definition of a business, the gain or loss is recognised by the investor to the extent of the other investors’ interests.
The amendments will only apply when an investor sells or contributes assets to its associate or joint venture. They are not intended to address
accounting for the sale or contribution of assets by an investor in a joint operation.
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The complete version of MFRS 9 was issued in November 2014.
MFRS 9 retains but simplifies the mixed measurement model in MFRS 139 and establishes three primary measurement categories for financial
assets: amortised cost, fair value through profit or loss and fair value through other comprehensive income (‘OCI’). The basis of classification
depends on the entity’s business model and the contractual cash flow characteristics of the financial asset. Investments in equity instruments are
always measured at fair value through profit or loss with an irrevocable option at inception to present changes in fair value in OCI (provided the
instrument is not held for trading). A debt instrument is measured at amortised cost only if the entity is holding it to collect contractual cash flows
and the cash flows represent principal and interest.
For liabilities, the standard retains most of the MFRS 139 requirements. These include amortised cost accounting for most financial liabilities, with
bifurcation of embedded derivatives. The main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair
value change due to an entity’s own credit risk is recorded in other comprehensive income rather than the income statement, unless this creates
an accounting mismatch.
There is now a new expected credit losses model on impairment for all financial assets that replaces the incurred loss impairment model used in
MFRS 139. The expected credit losses model is forward-looking and eliminates the need for a trigger event to have occurred before credit losses
are recognised.
The Group and the Company is in the process of assessing the impact of the above standards, amendments and improvements to published
standards and interpretations to existing standards on its financial statements and are not anticipated to have any significant impact on the
financial position of the Group and the Company in the year of initial application.
B CONSOLIDATION
(a) Subsidiaries
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or
has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries
are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.
The Group applies the acquisition method to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the
fair value of any asset transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the Group. The consideration
transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as
incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at
the acquisition date.
The Group recognises any non-controlling interest in the acquiree on an acquisition-by-acquisition basis, either at fair value or at the non-controlling
interest’s proportionate share of the recognised amounts of acquiree’s identifiable assets.
The Group applies predecessor accounting to account for business combinations under common control. Under predecessor accounting to account for
business combinations under common control. Under predecessor accounting, assets and liabilities acquired are not restated to their respective fair values.
They are recognised at the carrying amounts from the consolidated financial statements of the ultimate holding company of the Group and adjusted
to ensure uniform accounting policies of the Group. The difference between any consideration given and the aggregate carrying amounts of the assets
and liabilities (as of the date of the transaction) of the acquired entity is recognised as an adjustment to equity. No additional goodwill is recognised.
The acquired entity’s results, assets and liabilities are consolidated as if both the acquirer and acquiree had always been combined. Consequently, the
consolidated financial statements reflect both entities’ full year’s results. The corresponding amounts for the previous year reflect the combined results of
both entities.
If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is
remeasured to fair value at the acquisition date and any gains or losses arising from such remeasurement are recognised in profit or loss.
Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of
the contingent consideration that is deemed to be an asset or liability is recognised in accordance with MFRS 139 either in profit or loss as a change to
other comprehensive income. Contingent consideration that is classified as equity is not remeasured, and its subsequent settlement is accounted for within equity.
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previous
equity interest in the acquiree over the fair value of the identifiable net assets acquired is recognised as goodwill. If the total of consideration transferred,
non-controlling interest recognised and previously held interest measured is less than the fair value of the net assets of the subsidiary acquired in the case
of a bargain purchase, the difference is recognised directly in the income statements (see Note E on goodwill).
Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated.
When necessary, amounts reported by subsidiaries have been adjusted to conform to the Group’s accounting policies.
When the Group ceases to have control any retained interest in the entity is remeasured to its fair value at the date when control is lost, with the change in
carrying amount recognised in profit and loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained
interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that
entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other
comprehensive income are reclassified to profit and loss.
Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions – that is, as transactions with the
owners in their capacity as owners. The difference between fair value of any consideration paid and the relevant shares acquired of the carrying value of
the net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity.
B CONSOLIDATION (CONTINUED)
A joint arrangement is an arrangement of which there is contractually agreed sharing of control by the Group with one or more parties, where decisions
about the relevant activities relating to the joint arrangement require unanimous consent of the parties sharing control. The classification of a joint
arrangement as a joint operation or a joint venture depends upon the rights and obligations of the parties to the arrangement. A joint venture is a joint
arrangement whereby the joint venturers have rights to the net assets of the arrangement. A joint operation is a joint arrangement whereby the joint
operators have rights to the assets and obligations for the liabilities, relating to the arrangement.
The Group’s interest in a joint venture is accounted for in the financial statements by the equity method of accounting. Under the equity method of
accounting, interests in joint ventures are initially recognised at cost and adjusted thereafter to recognise the Group’s share of the post-acquisition profits
or losses and movements in other comprehensive income. When the Group’s share of losses in a joint venture equals or exceeds its interests in the joint
ventures (which includes any long-term interests that, in substance, form part of the Group’s net investment in the joint ventures), the Group does not
recognise further losses, unless it has incurred obligations or made payments on behalf of the joint ventures.
The amounts due from joint ventures of which the Group does not expect repayment in the foreseeable future are considered as part of the Group’s
investment in the joint ventures.
Unrealised gains on transactions between the Group and its joint ventures are eliminated to the extent of the Group’s interest in the joint ventures.
Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of the joint
ventures have been changed where necessary to ensure consistency with the policies adopted by the Group.
(d) Associates
Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and
50% of voting rights. Significant influence is power to participate in financial and operating policy decisions of associates but not power to exercise control over
those policies.
Investments in associates are accounted for using equity method of accounting. Under the equity method, the investment is initially recognised at cost,
and the carrying amount is increased or decreased to recognise the investor’s share of the profit or loss of the investee after the date of acquisition. The
Group’s investment in associates includes goodwill identified on acquisition (see Note E), net of any accumulated impairment loss.
The amounts due from associates of which the Group does not expect repayment in the foreseeable future are considered as part of the Group’s investment
in the associates.
If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised
in other comprehensive income is reclassified to profit and loss where appropriate.
The Group’s share of its associates’ post-acquisition profit or loss is recognised in the income statements, and its share of post-acquisition movements
in other comprehensive income is recognised in other comprehensive income with a corresponding adjustment to the carrying amount of the investment.
The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When the Group’s share of losses in an associate
equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has
incurred legal or constructive obligations or made payments on behalf of the associate.
Profits and losses resulting from upstream and downstream transactions between the Group and its associate are recognised in the Group’s financial
statements only to the extent of unrelated investor’s interests in the associates. Unrealised losses are eliminated unless the transaction provides evidence
of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies
adopted by the Group.
Dilution gains and losses arising in investments in associates are recognised in income statements.
When the Group increases its stake in an existing investment and the investment becomes an associate for the first time, goodwill is calculated at each
stage of the acquisition. The Group does not revalue its previously owned share of net assets to fair value. Any existing available-for-sale reserve is reversed
in other comprehensive income, restating the investment to cost. For an investment designated at fair value through profit or loss, the reversal resulting
from the restatement to cost is made against retained earnings. A share of profits (after dividends) together with a share of any equity movements relating
to the previously held interest are accounted for in other comprehensive income.
The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case,
the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises
the amount adjacent to ‘share of results of associates’ in the income statements.
B CONSOLIDATION (CONTINUED)
In the Company’s separate financial statements, investments in subsidiaries, joint ventures and associates are carried at cost less accumulated impairment
losses. On disposal of investments in subsidiaries, joint ventures and associates, the difference between disposal proceeds and the carrying amounts of
the investments are recognised in the income statements.
Property, plant and equipment are initially stated at cost less accumulated depreciation and impairment losses. The cost of an item of property, plant and
equipment initially recognised includes its purchase price and any cost that is directly attributable to bringing the asset to the location and condition necessary
for it to be capable of operating in the manner intended by management. Cost also includes borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset (see Note R on borrowings and borrowing costs).
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic
benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is
derecognised. All other repairs and maintenance are recognised as expenses in the income statements during the financial years in which they are incurred.
Freehold land is not depreciated as it has an infinite life. Leasehold land classified as finance lease is amortised in equal instalments over the period of the
respective leases. Other property, plant and equipment are depreciated on the straight line method to allocate the cost or the revalued amounts to their residual
values over their estimated useful lives, summarised as follows:
Residual values and useful lives of assets are reviewed, and adjusted if appropriate, at the end of the reporting period. The Group carries out assessment on
residual values and useful lives of assets on an annual basis. There was no adjustment arising from the assessment performed in the financial year.
Depreciation on assets under construction commences when the assets are ready for their intended use.
At the end of the reporting period, the Group assesses whether there is any indication of impairment. If such indications exist, an analysis is performed to assess
whether the carrying amount of the asset is fully recoverable. A write down is made if the carrying amount exceeds the recoverable amount (see Note G on
impairment of non-financial assets).
Gains and losses on disposals are determined by comparing net disposal proceeds with carrying amount and are included in income statements.
D INVESTMENT PROPERTIES
Investment properties, comprising principally land, development rights and buildings are held for long term rental yields or for capital appreciation or both, and are
not substantially occupied by the Group. Investment properties are measured initially at cost, including related transaction costs. Building fittings that are attached
to the buildings are also classified as investment properties. Cost also includes borrowing costs that are directly attributable to the acquisition, construction or
production of a qualifying asset (see Note R on borrowings and borrowing costs).
After initial recognition, investment property is stated at cost less any accumulated depreciation and impairment losses. At each reporting date, the Group
assesses whether there is any indication of impairment. If such indications exist, an analysis is performed to assess whether the carrying amount of the asset
is fully recoverable. A write down is made if the carrying amount exceeds the recoverable amount. (see Note G on impairment of non-financial assets). Freehold
land is not depreciated as it has infinite life. Investment properties are depreciated on the straight line basis to allocate the cost to their residual values over their
estimated useful lives, summarised as follows:
Subsequent expenditure is capitalised to the asset’s carrying amount only when it is probable that future economic benefits associated with the expenditure
will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance costs are expensed when incurred. When part of an
investment property is replaced, the carrying amount of the replaced part is derecognised.
Investment property is derecognised (eliminated from the statement of financial position) either when it has been disposed of or when the investment property is
permanently withdrawn from use and no future economic benefit is expected from its disposal. Gains and losses on disposals are determined by comparing net
disposal proceeds with the carrying amount and are included in the income statements.
E INTANGIBLE ASSETS
(a) Goodwill
Goodwill or negative goodwill represents the excess or deficit of the cost of acquisition of subsidiaries, jointly controlled entities and associates over the
fair value of the Group’s share of the identifiable net assets at the date of acquisition.
Goodwill on acquisitions of subsidiaries is included in the statement of financial position as intangible assets whereas negative goodwill is recognised
immediately in the income statements.
Goodwill impairment reviews are undertaken annually or more frequently if events or changes in circumstances indicate a potential impairment. The
carrying value of goodwill is compared to the recoverable amount, which is the higher of value in use and the fair value less cost to sell. Any impairment
losses on goodwill is recognised immediately as an expense and is not subsequently reversed. Gains and losses on the disposal of a subsidiary include
the carrying amount of goodwill relating to the subsidiary sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of
cash-generating units that are expected to benefit from the synergies of the business combination in which the goodwill arose, identified according to
operating segment (see Note G on impairment of non-financial assets).
Goodwill on acquisition of jointly controlled entities and associates is included in investments in jointly controlled entities and investments in associates.
Such goodwill is tested for impairment as part of the overall balance.
Research expenditure is recognised as an expense when incurred. Costs incurred on development projects (relating to the design and testing of new or
improved products) are recognised as intangible assets when the following criteria are fulfilled:
(i) it is technically feasible to complete the intangible asset so that it will be available for use or sale;
(ii) management intends to complete the intangible asset and use or sell it;
(iii) there is an ability to use or sell the intangible asset;
(iv) it can be demonstrated how the intangible asset will generate probable future economic benefits;
(v) adequate technical, financial and other resources to complete the development and to use or sell the intangible asset are available; and
(vi) the expenditure attributable to the intangible asset during its development can be reliably measured.
Other development expenditures that do not meet these criteria are recognised as an expense when incurred. Development costs previously recognised
as an expense are not recognised as an asset in a subsequent period. Capitalised development costs recognised as intangible assets are amortised
from the point at which the asset is ready for use on a straight-line basis over its useful life, not exceeding 3 years.
Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation
are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. See Note G on
impairment of non-financial assets.
(c) Licenses
Acquired licenses are shown at historical cost. Licenses have a finite useful life and are carried at cost less accumulated amortisation. Amortisation is
calculated using the straight-line method to allocate the cost of the acquired licenses over their estimated useful lives of 10 to 50 years.
F BIOLOGICAL ASSETS
Fish are measured at fair value less cost to sell, based on market prices at auction of livestock of similar age, breed and genetic merit with adjustments, where
necessary, to reflect the differences. The costs to sell include the incremental selling costs, including fees and commission paid to dealers.Changes in fair value
of livestock are recognised in the income statement. Cost such as feeding, labour costs, and maintenance of fish farm are expensed as incurred. The cost of
purchase fish plus transportation charges are capitalised as part of biological assets.
In measuring the fair value of fish various management estimates and judgement are required. Estimates and judgements in determining the fair value of fish
relate to the market prices, average length or weight and qualityify of the fish and mortality rates.
The broodstocks are measured at its cost less accumulated depreciation and impairment losses as the quoted market prices are not available and for which
alternative estimates of fair value measurements are determined to be clearly unreliable. Once the fair value of such a biological asset becomes reliably
measurable, an entity shall measure it at its fair value less costs to sell. The costs of broodstocks are amortised over the expected reproductive live span of the
respective fish for 5 years.
Gains and losses on disposal are determined by comparing disposal proceeds with carrying amounts and are recognised in profit or loss in the year of the disposal.
Assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment
loss is recognised for the amount by which the carrying amount of the asset exceeds its recoverable amount. The recoverable amount is the higher of an asset’s
fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately
identifiable cash flows (cash-generating units). Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the
impairment at each reporting date.
The impairment is charged to the income statements unless it reverses a previous revaluation, in which case it is charged to revaluation surplus. Impairment
losses on goodwill are not reversed. In respect of other assets, any subsequent increase in recoverable amount is recognised in the income statements.
Reversals of impairment loss is recognised immediately in income statements and shall not exceed the carrying amount that would have been determined had
no impairment loss been recognised for the asset in prior years.
H FINANCIAL INSTRUMENTS
A financial asset is any asset that is cash, a contractual right to receive cash or another financial asset from another enterprise, a contractual right to
exchange financial instruments with another enterprise under conditions that are potentially favourable, or an equity instrument of another enterprise.
Financial assets are recognised in the statement of financial position when, and only when, the Group becomes a party to the contractual provisions of
the financial instrument.
When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets not at fair value through profit and loss,
directly attributable transaction costs.
The Group classifies its financial assets in the following categories: at fair value through profit or loss, loans and receivables, and available-for-sale. The
classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at
initial recognition.
Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this category if acquired or
incurred principally for the purpose of selling or repurchasing it in the near term. Derivatives are also categorised as held for trading unless they
are designated as hedges. Assets in this category are classified as current assets if expected to be settled within 12 months; otherwise they are
classified as non-current.
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are
included in current assets, except for maturities greater than 12 months after the end of the reporting period whereby these are classified as non-
current assets. The Group’s loans and receivables comprise ‘concession receivables’, ‘amounts owing from subsidiaries’, ‘amounts owing from
associates and joint ventures’, ‘amount owing from a related company’, ‘receivables and contract assets’, ‘cash held under Housing Development
Accounts’ and ‘deposits, cash and bank balances’ in the statement of financial position (Notes 23, 26, 27 and 28).
Subsequent to initial recognition, loans and receivables are measured at amortised cost using the effective interest method. Gains and losses are
recognised in the income statement when the loans and receivables are derecognised or impaired, and through the amortisation process.
Financial assets are derecognised if the Group’s contractual rights to the cash flows from the financial assets expire or if the Group transfers the
financial asset to another party without retaining control or transfers substantially all the risks and rewards of the asset.
Upon adoption of IC Interpretation 12 “Service Concession Arrangements”, the Group recognises a financial asset arising from a service concession
arrangement when the operator has an unconditional right to receive cash or another financial asset from the grantor in remuneration for concession
services. Such financial assets are recognised in the statement of financial position, for the amount of the fair value of the infrastructure at initial
recognition and subsequently at amortised cost.
The operator has such an unconditional right if the grantor contractually guarantees the payment of amounts specified or determined in the contract
or the shortfall, if any, between amounts received and amounts specified or determined in the contract even if payment is contingent on the operator
ensuring that the infrastructure meets specified quality or efficiency requirements.
An impairment loss is recognised if the carrying amount of these assets exceeds the present value of future cash flows discounted at the initial
effective interest rate. The portion falling due within one year is included in current assets, while the portion falling due more than one year after the
end of the reporting period is presented in the non-current assets.
Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories.
They are included in non-current assets unless the investment matures or management intends to dispose of it within 12 months of the end of the
reporting period.
Subsequent to initial recognition, available-for-sale financial assets are carried at fair value. Changes in the fair value of available-for-sale financial
assets are recognised in other comprehensive income, except for impairment losses. (see Note H(c) on impairment of financial assets and Note W(b)
on foreign exchange gains and losses on monetary assets). The exchange differences on monetary assets are recognised in the income statements,
whereas exchange differences on non-monetary assets are recognised in other comprehensive income as part of fair value change.
Interest and dividend income on available-for-sale financial assets are recognised separately in the income statements. Interest on available-for-sale
debt securities calculated using the effective interest method is recognised in the income statements.Dividend income on available-for-sale equity
instruments are recognised in the income statements when the Group’s right to receive payments is established.
A financial liability is any liability that is a contractual obligation to deliver cash or another financial asset to another enterprise, or to exchange financial
instruments with another enterprise under conditions that are potentially unfavourable.
Financial liabilities are recognised in the statement of financial position when, and only when, the Group becomes a party to the contractual provisions of
the financial instrument.
When financial liabilities are recognised initially, they are measured at fair value, plus, in the case of financial liabilities not at fair value through profit or
loss, directly attributable transaction costs.
The Group classifies its financial liabilities in the following categories: other financial liabilities and financial guarantee contracts. The classification
depends on the purpose for which the financial liabilities were issued. Management determines the classification of its financial liabilities at initial
recognition.
Other financial liabilities of the Group comprise, ‘amounts owing to associates’, ‘payables and contract liabilities’, ‘interest bearing bank borrowings’
and ‘advances from subsidiaries’ in the statement of financial position. (Notes 26, 34,36 and 37).
Subsequent to initial recognition, other financial liabilities are measured at amortised cost using the effective interest method. Gains and losses are
recognised in the income statement when the other financial liabilities are derecognised, and through the amortisation process.
Financial liabilities are derecognised when the obligation specified in the contract is discharged or cancelled or expired.
The Group has issued corporate guarantee to banks for borrowings of its subsidiaries. These guarantees are financial guarantees as they require
the Group to reimburse the banks if the subsidiaries fail to make principal or interest payments when due in accordance with the terms of their
borrowings.
Financial guarantee contracts are recognised as a financial liability at the time the guarantee is issued. The liabilities are initially recognised at their
fair values plus transaction costs and subsequently at the higher of the amount determined in accordance with MFRS 137 ‘Provisions, Contingent
Liabilities and Contingent Assets’ and the amount initially recognised less cumulative amortisation, where appropriate, in the Group’s statement of
financial position.
The fair value of financial guarantees is determined as the present value of the difference in net cash flows between the contractual payments under
the debt instrument and the payments that would be required without the guarantee, or the estimated amount that would be payable to a third party
for assuming the obligations.
Where financial guarantees in relation to loans or payables of subsidiaries are provided by the Company for no compensation, the fair values are
accounted for as contributions and recognised as part of the cost of investment in subsidiaries.
Financial guarantees are subsequently amortised to the income statements over the period of the subsidiaries’ borrowings, unless it is probable that
the Group will reimburse the bank for an amount higher than the unamortised amount. In this case, the financial guarantees shall be carried at the
expected amount payable to the bank in the Group’s statement of financial position.
The Group assesses at the end of the reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired.
A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result
of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated
future cash flows of the financial asset or group of financial assets that can be reliably estimated.
The criteria that the Group uses to determine that there is objective evidence of an impairment loss include:
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initial recognition of those assets, although the decrease cannot yet be identified with the individual financial assets in the portfolio, including:
(i) adverse changes in the payment status of borrowers in the portfolio; and
(ii) national or local economic conditions that correlate with defaults on the assets in the portfolio.
The amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (exclud-
ing future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The carrying amount of the asset
is reduced and the amount of the loss is recognised in the income statements. If ‘loans and receivables’ has a variable interest rate, the discount rate
for measuring any impairment loss is the current effective interest rate determined under the contract. As a practical expedient, the Group may measure
impairment on the basis of an instrument’s fair value using an observable market price.
The carrying amount of the financial assets is reduced by the impairment loss directly for all financial assets with the exception of trade receivables,
where the carrying amount is reduced through the use of an allowance account. When a trade receivable becomes uncollectible, it is written off against
the allowance account.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the im-
pairment was recognised (such as an improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss is recognised
in the income statements.
When an asset is uncollectible, it is written off against the related allowance account. Such assets are written off after all the necessary procedures have
been completed and the amount of the loss has been determined.
For debt securities, the Group uses the criteria of impairment loss applicable for ‘assets carried at amortised cost’ above. If, in a subsequent period, the
fair value of a debt instrument classified as available-for-sale increases and the increase can be objectively related to an event occurring after the impair-
ment loss was recognised in the income statements, the impairment loss is reversed through the income statements.
In the case of equity securities classified as available-for-sale, in addition to the criteria for ‘assets carried at amortised cost’ above, a significant or
prolonged decline in the fair value of the security below its cost is also considered as an indication that the assets are impaired. If any such evidence
exists for available-for-sale financial assets, the cumulative losses that have been recognised directly in equity is removed from equity and recognised
in the income statements. The amount of cumulative loss that is reclassified to the income statements is the difference between the acquisition cost
and the current fair value, less any impairment loss on that investment previously recognised in the income statements. Impairment losses recognised in
consolidated income statements on equity instruments classified as available-for-sale are not reversed through the consolidated income statement.
Investment in unquoted equity instruments which are classified as available-for-sale and whose fair value cannot be reliably measured are measured at
cost. These investments are assessed for impairment at each reporting date.
The particular recognition method adopted for financial instruments recognised in the statement of financial position is disclosed in the individual accounting
policy statements associated with each item.
The fair value of publicly traded securities is based on quoted market prices at the reporting date.
In assessing the fair value of non-traded financial instruments, the Group uses a variety of methods and makes assumptions that are based on market
conditions existing at each reporting date.
The fair value of financial liabilities is estimated by discounting the future contractual cash flows at the current market interest rate for each type of the
financial liabilities of the Group.
The fair values for financial assets (less any estimated credit adjustments) and financial liabilities with a maturity of less than one year are assumed to
approximate their fair values.
Financial assets and liabilities are offset and the net amount is presented in the statement of financial position when there is a legally enforceable right to
offset the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle the liability simultaneously.
A portion of the Group’s assets are within the framework of concession contracts granted by the government (“the grantor”). In order to fall within the scope of
concession contract, a contract must satisfy the following two criteria:
- The grantor controls or regulates what services the operator must provide with the infrastructure assets, to whom it must provide them, and at what
price; and
- The grantor controls the significant residual interest in the infrastructure assets at the end of the term of the arrangement.
Such infrastructure assets are not recognised by the Group as property, plant and equipment but as financial assets as described in Note H(a).
The Group recognises the consideration received or receivable as a financial asset to the extent that it has an unconditional right to receive cash or another
financial asset for the construction and operating services. Financial assets are accounted for in accordance with the accounting policy set out in Note H(a).
The Group recognises revenue from construction and operation of infrastructure assets in accordance with its revenue recognition policy set out in Note V.
The Group has entered into service concession arrangements with the government of the People’s Republic of China (“PRC”) to construct and operate waste
water treatment plants for a period ranging from 23 to 25 years. The terms of arrangement allows the Group to maintain and manage these treatment plants and
received consideration based on the water usage and rates as determined by the grantor for entire duration of the concession.
J LEASES
A lease is an agreement whereby the lessor conveys to the lessee in return for a payment, or series of payments, the right to use an asset for an agreed period
of time.
Leases of assets where a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payment
made under operating leases (net of any incentives received from the lessor) is charged to the income statements on the straight line basis over the lease
period.
Initial direct costs incurred by the Group in negotiating and arranging operating leases are recognised in the income statements when incurred. When an
operating lease is terminated before the lease period has expired, any payment required to be made to the lessor by way of penalty is recognised as an
expense in the period in which termination takes place.
The Group leases certain property, plant and equipment. Leases of property, plant and equipment, where the Group has substantially all the risks and
rewards of ownership, are classified as finance leases.Finance leases are capitalised at the lease’s commencement at the lower of the fair value of the
leased property and the present value of the minimum lease payments.
Each lease payment is allocated between the liability and finance charges. The corresponding rental obligations, net of finance charges, are included in
other long-term payables. The interest element of the finance cost is charged to the income statements over the lease period so as to produce a constant
periodic rate of interest on the remaining balance of the liability for each period. The property, plant and equipment acquired under finance leases are
depreciated over the shorter of the useful life of the asset and the lease term.
Initial direct costs incurred by the Group in negotiating and arranging finance leases are added to the carrying amount of the leased assets and recognised
as an expense in the income statements over the lease term on the same basis as the lease expense.
Non-current assets are classified as assets held for sale when their carrying amount is to be recovered principally through a sale transaction and a sale is
considered highly probable. They are stated at the lower of carrying amount and fair value less costs to sell.
A discontinued operation is a component of the Group’s business that represents a separate major line of business or geographical area of operations that has
been disposed of or is held for sale, or a subsidiary acquired exclusively with a view to resale. Classification as a discontinued operation occurs upon disposal
or when the operation meets the criteria to be classified as held for sale, if earlier. When an operation is classified as a discontinued operation, the attributable
results and financial position are presented or disclosed separately.
Trade and other receivables are amounts due from customers for goods sold or services performed in the ordinary course of business. If collection is expected in
one year or less (or in the normal operating cycle of the business if longer), they are classified as current assets. If not, they are presented as non-current assets.
Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision
for impairment. (see Note H(c) on impairment of financial assets).
M INVENTORIES
Inventories are stated at the lower of cost and net realisable value.
The cost of unsold properties is stated at the lower of historical cost and net realisable value. Historical cost includes, where relevant, cost associated
with the acquisition of land, including all related costs incurred subsequent to the acquisition necessary to prepare the land for its intended case, related
development costs to projects, direct building costs and other costs of bringing the inventories to their present location and condition.
Net realisable value is the estimated selling price in the ordinary course of business less applicable variable selling expenses.
Cost is determined using the first-in, first-out method and comprises food and beverage, printing and stationeries and guestroom supplies.
Net realisable value is the estimated selling price in the ordinary course of business, less the applicable variable selling expenses.
The costs of land held for property development is stated at the lower of historical cost and net realisable value. The cost of land held for property
development consists of the purchase price of the land, professional fees, stamp duties, commissions, conversion fees, other relevant levies and direct
development cost incurred in preparing the land for development.
Net realisable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and the estimated cost necessary
to make the sale. If net realisable value cannot be determined reliably, these inventories will be stated at the lower of cost or fair value less costs to sell.
Fair value is the amount the inventory can be sold in an arm’s length transaction.
Land held for property development for which no significant development work has been undertaken or where development activities are not expected to
be completed within the normal operating cycle, is classified as non-current asset.
Land held for property development is transferred to property development costs (under current assets) when development activities have commenced and
where development activities can be completed within the Group’s normal operating cycle.
Cost is determined based on a specific identification basis. Property development costs comprising costs of land, direct materials, direct labour, other
direct costs, attributable overheads and payments to subcontractors that meet the definition of inventories are recognised as an asset and are stated at
the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of
completion and applicable selling expenses. The asset is subsequently recognised as an expense in income statements when or as the control of the asset
is transferred to the customer.
Cost is determined using the first-in, first-out method. The cost of finished goods and work-in-progress comprises raw materials, direct labour, other direct
costs and related production overheads (based on normal operating capacity).
Net realisable value is the estimated selling price in the ordinary course of business, less the cost of completion and applicable variable selling expenses.
N CONSTRUCTION CONTRACTS
A construction contract is a contract specifically negotiated for the construction of an asset or a combination of assets that are closely interrelated or interdependent
in terms of their design, technology and functions or their ultimate purpose or use.
Cost incurred to fulfil the contracts, comprising cost of direct materials, direct labour, other direct costs, attributable overheads and payments to subcontractors
are recognised as an asset and amortised over to income statements systematically to reflect the transfer of the contracted service to the customer.
The Group uses the efforts or inputs to the satisfaction of the performance obligation to determine the appropriate amount to recognise in a given period. This
is measured by reference to the contract costs incurred up to the end of the reporting period as a percentage of total estimated costs for each contract. Costs
incurred in the financial year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. They are
presented as inventories, prepayments or other assets, depending on their nature. When the carrying amount of the asset exceeds the remaining amount of
consideration that the Group expects to receive in exchange of the contracted property, an impairment loss is recognised to income statements.
The Group presents as an asset the gross amount due from customers for contract work for all contracts in progress for which costs incurred plus recognised
profits (less recognised losses) exceed contract liabilities. Contract liabilities not yet paid by customers and retention monies are included within ‘receivables and
contract assets’. The Group presents as a liability the gross amount due to customers for contract work for all contracts in progress for which contract liabilities
exceed costs incurred plus recognised profits (less recognised losses).
For the purpose of the statement of cash flows, cash and cash equivalents comprise cash on hand, deposits held at call with banks, other short term and highly
liquid investments with original maturities of three months or less, and bank overdrafts. In the statement of financial position, bank overdrafts are shown within
borrowings in current liabilities.
P SHARE CAPITAL
(a) Classifications
Ordinary shares and non-redeemable preference shares with discretionary dividends are classified as equity. Other shares are classified as equity and/
or liability according to the economic substance of the particular instrument. (see Note R on borrowings and borrowings costs and Note Z on compound
financial instruments).
Incremental costs directly attributable to the issue of new shares or options are deducted against share premium account.
Interim dividends on ordinary shares are recognised as liabilities when declared before the reporting date. Proposed final dividends are accrued as
liabilities only after approval by shareholders.
Distributions to holders of an equity instrument are debited directly to equity, net of any related income tax benefit and the corresponding liability is recognised
in the period in which the dividends are approved.
Where the Company purchases the Company’s equity share capital (treasury shares), the consideration paid, including any directly attributable incremental
external costs, net of tax, is included in equity attributable to the equity holders as treasury shares until they are cancelled, reissued or disposed. Where
such shares are subsequently cancelled, reissued or disposed, their nominal amount will be eliminated, and the differences between their cost and their
nominal amount will be taken to reserves, as appropriate.
Trade and other payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade and other
payables are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are
presented as non-current liabilities.
Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.
(a) Classification
Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost; any difference
between initial recognised amount and the redemption value is recognised in the income statements over the period of the borrowings using the effective
yield method.
Fees paid on the establishment of loan facilities are regarded as transaction costs of the loan to the extent that it is possible some or all of the facility will
be drawdown. In this case, the fee is deferred until the drawdown occurs. To the extent there is no evidence that it is probable that some or all the facility
will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility of which it relates.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after
the reporting date.
Preference shares, which are mandatorily redeemable on a specific date, are classified as liabilities. The dividends on these preference shares are recognised as
finance cost in the income statements.
General and specific borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily
take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are
substantially ready for their intended use or sale. Qualifying assets of the Group includes inventories and investment properties that take a substantial period
of time to get ready for their intended use or sale.
All other borrowing costs are recognised in the income statements in the financial year in which they are incurred.
The tax expense for the financial year comprises current and deferred tax. Tax is recognised in the income statements, except to the extent that it relates to
items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity,
respectively.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where
the Group’s subsidiaries and associates operate and generate taxable income.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It
establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.The liability is measured using the single best
estimate of the most likely outcome.
Current tax expense is determined according to the tax laws of each jurisdiction in which the Group operates and includes all taxes based upon the taxable
profits, including withholding taxes payable by a foreign subsidiary or associate on distributions of retained earnings to companies in the Group, and real property
gains taxes payable on disposal of properties.
Deferred tax is recognised in full, using the liability method, on temporary differences arising between the amounts attributed to assets and liabilities for tax
purposes and their carrying amounts in the financial statements. However, deferred tax is not accounted for if it arises from initial recognition of an asset or
liability in a transaction other than a business combination that, at the time of the transaction, affects neither accounting nor taxable profit or loss. Deferred tax
is determined using tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period and are expected to apply when
the related deferred tax asset is realised or the deferred tax liability is settled.
Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised for all deductible temporary differences to the
extent that taxable profit will be available against which the deductible temporary differences, unused tax losses or unused tax credits can be utilised.
Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except for deferred income tax liability where
the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable
future. Generally the Group is unable to control the reversal of the temporary difference for associates. Only where there is an agreement in place that gives the
Group the ability to control the reversal of the temporary difference not recognised.
Deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which the deductible temporary differences or
unused tax losses can be utilised.
Deferred tax is recognised in the income statements, except when it arises from a transaction which is recognised directly in the equity or other comprehensive
income, or when it arises from a business combination that is an acquisition, in which case the deferred tax is included in the resulting goodwill.
Deferred and income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and
when the deferred income tax assets and liabilities relate to taxes levied by the same taxation authority on either the taxable entity or different taxable entities
where there is an intention to settle the balances on a net basis.
T EMPLOYEE BENEFITS
Wages, salaries, bonuses, paid annual leave and non-monetary benefits are accrued in the financial year in which the associated services are rendered
by employees of the Group.
The Group recognises a liability and an expense for bonuses and profit-sharing, based on a formula that takes into consideration the profit attributable
to the Company’s shareholders after certain adjustments. The Group recognises a provision where contractually obliged or where there is a past practice
that has created a constructive obligation.
A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity (a fund) and will have no legal or
constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employee benefits relating to employee service in
the current and prior periods. The defined contribution plan of the Group relates to the contribution to the Group by various defined contribution plans in
accordance with local conditions and practices in the countries in which it operates the national defined contribution plan.
The Group’s contributions to defined contribution plans are charged to the income statements in the period to which they relate. Once the contributions
have been paid, the Group has no further payment obligations. Prepaid contributions are recognised as an asset to the extent that a cash refund or a
reduction in the future payments is available.
Termination benefits are payable whenever an employee’s employment is terminated before the normal retirement date or whenever an employee accepts
voluntary redundancy in exchange for these benefits. The Group recognises termination benefits when it is demonstrably committed to either terminate the
employment of current employees according to a detailed formal plan without possibility of withdrawal or to provide termination benefits as a result of an
offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after end of the reporting period are discounted to present value.
The Group does not recognise contingent assets and liabilities but discloses its existence in the financial statements. A contingent liability is a possible obligation
that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of
the Group or a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle the obligation. A contingent
liability also arises in the extremely rare cases where there is a liability that cannot be recognised because it cannot be measured reliably. However, contingent
liabilities do not include financial guarantee contracts.
A contingent asset is a possible asset that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more
uncertain future events beyond the control of the Group. The Group does not recognise contingent assets but discloses its existence where inflows of economic
benefits are probable, but not virtually certain.
Subsequent to the initial recognition, the Group measures the contingent liabilities that are recognised separately at the date of acquisition at the higher of the
amount that would be recognised in accordance with the provisions of MFRS 137 ‘Provisions, Contingent Liabilities and Contingent Assets’ and the amount initially
recognised less, when appropriate, cumulative amortisation recognised in accordance with MFRS 118 “Revenue”.
V REVENUE RECOGNITION
Revenue which represents income arising in the course of the Group’s ordinary activities is recognised by reference to each distinct performance obligation
promised in the contract with customer when or as the Group transfers the control of the goods or services promised in a contract and the customer
obtains control of the goods or services. Depending on the substance of the respective contract with customer, the control of the promised goods or
services may transfer over time or at a point in time.
A contract with customer exists when the contract has commercial substance, the Group and its customer has approved the contract and intend to
perform their respective obligations, the Group’s and the customer’s rights regarding the goods or services to be transferred and the payment terms can
be identified, and it is probable that the Group will collect the consideration to which it will be entitled to in exchange of those goods or services.
At the inception of each contract with customer, the Group assesses the contract to identify distinct performance obligations, being the units of account
that determine when and how revenue from the contract with customer is recognised. A performance obligation is a promise to transfer a distinct good or
service (or a series of distinct goods or services that are substantially the same and that have the same pattern of transfer) to the customer that is explicitly
stated in the contract and implied in the Group’s customary business practices. A good or service is distinct if:
t UIFDVTUPNFSDBOFJUIFSCFOFmUGSPNUIFHPPEPSTFSWJDFPOJUTPXOPSUPHFUIFSXJUIPUIFSSFBEJMZBWBJMBCMFSFTPVSDFTBOE
If a good or service is not distinct, the Group combines it with other promised goods or services until the Group identifies a distinct performance obligation
consisting a distinct bundle of goods or services.
Revenue is measured at the amount of consideration to which the Group expects to be entitled in exchange for transferring the promised goods or services
to the customers, excluding amounts collected on behalf of third parties such as sales and service taxes or goods and services taxes. If the amount of
consideration varies due to discounts, rebates, refunds, credits, incentives, performance bonuses, penalties or other similar items, the Group estimates the
amount of consideration that it expects to be entitled based on the expected value or the most likely outcome but the estimation is constrained up to the
amount that is highly probable of no significant reversal in the future. If the contract with customer contains more than one distinct performance obligation,
the amount of consideration is allocated to each distinct performance obligation based on the relative stand-alone selling prices of the goods or services
promised in the contract.
The consideration allocated to each performance obligation is recognised as revenue when or as the customer obtains control of the goods or services. At
the inception of each contract with customer, the Group determines whether control of the goods or services for each performance obligation is transferred
over time or at a point in time. Control over the goods or services are transferred over time and revenue is recognised over time if:
t UIFDVTUPNFSTJNVMUBOFPVTMZSFDFJWFTBOEDPOTVNFTUIFCFOFmUTQSPWJEFECZUIF(SPVQTQFSGPSNBODFBTUIF(SPVQQFSGPSNT
t UIF(SPVQTQFSGPSNBODFDSFBUFTPSFOIBODFTBDVTUPNFSDPOUSPMMFEBTTFUPS
t UIF(SPVQTQFSGPSNBODFEPFTOPUDSFBUFBOBTTFUXJUIBMUFSOBUJWFVTFBOEUIF(SPVQIBTBSJHIUUPQBZNFOUGPSQFSGPSNBODFDPNQMFUFEUPEBUF
Revenue for performance obligation that is not satisfied over time is recognised at the point in time at which the customer obtains control of the promised
goods or services.
Specific revenue recognition criteria for each of the Group’s activities are as described below.
Room rental revenue is accrued on a daily basis on customer-occupied rooms. Revenue from the sales of food and beverage is recognised when the
customer receives and consumes, and the Group has a present right to payment for, the food and beverage product. Hotel revenue is recorded based
on the published rates, net of discounts.
Specific revenue recognition criteria for each of the Group’s activities are as described below. (continued)
Revenue from property development and construction contract is recognised when or as the control of the asset is transferred to the customer.
Depending on the terms of the contract and the laws that apply to the contract, control of the asset may transfer over time or at a point in time. Control
of the asset is transferred over time if the Group’s performance:
t DSFBUFTBOEFOIBODFTBOBTTFUUIBUUIFDVTUPNFSDPOUSPMTBTUIF(SPVQQFSGPSNTPS
t EPFTOPUDSFBUFBOBTTFUXJUIBOBMUFSOBUJWFVTFUPUIF(SPVQBOEUIF(SPVQIBTBOFOGPSDFBCMFSJHIUUPQBZNFOUGPSQFSGPSNBODFDPNQMFUFEUP
date.
If control of the asset transfers over time, revenue is recognised over the period of the contract by reference to the progress towards complete
satisfaction of that performance obligation. Otherwise, revenue is recognised at a point in time when the customer obtains control of the asset.
The progress towards complete satisfaction of the performance obligation is measured based on one of the following methods that best depict the
Group’s performance in satisfying the performance obligation:
Service and management fees are recognised in the accounting period in which the services are rendered and the customer receives and consumes
the benefits provided by the Group, and the Group has a present right to payment for, the services.
Other rent related and car park income is recognised upon services being rendered.
Revenue from electricity sales are recognised upon supply and distribution of electricity to the customer and the customer receives and consumes
the electrical energy.
(v) Others
Revenue from delivering services on a time basis or as a fixed-price contract, with contract term is recognised in the period the services are provided,
using a straight-line basis over the term of the contract.
Certain arrangements whereby customer purchase a goods together with a servicing agreement, the amount of revenue allocated to each element
is based upon the relative fair value of the various elements. The fair value of each element is determined based on the current market price of each
of the elements when sold separately. The revenue relating to the goods is recognised when risk and rewards of the goods are transferred to the
customer which occurs on delivery. Revenue relating to the service element is recognised on a straight-line basis over the service period.
When assets are leased out under an operating lease, the asset is included in the statement of financial position based on the nature of the asset.
Lease income on operating leases is recognised over the non-cancellable term of the lease on a straight-line basis. Lease income is shown net of rebates
and discounts. Lease income includes base rent turnover or percentage rent, service and promotional charges from tenants. Base rent is recognised on
a straight line basis over the lease. Initial direct cost incurred by the Group in negotiating and arranging an operating lease is recognised as an asset and
amortised over the non-cancellable lease term on the same basis as the lease income.
Interest income is recognised on a time proportion basis, taking into account the principal outstanding and the effective rate over the period of maturity,
unless collectibility is in doubt, in which case it is recognised on a cash receipt basis.
W FOREIGN CURRENCIES
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in
which the entity operates (the “functional currency”).The financial statements are presented in Ringgit Malaysia, which is the Company’s functional and
presentation currency.
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation
where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end
exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statements.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the income statement within ‘other operating
income or expense’.
Changes in the fair value of monetary securities denominated in foreign currency classified as available-for-sale are analysed between translation differences
resulting from changes in the amortised cost of the security and other changes in the carrying amount of the security. Translation differences related to
changes in amortised cost are recognised in the income statements, and other changes in the carrying amount are recognised in other comprehensive
income.
Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in income
statements as part of the fair value gain or loss. Translation differences on non-monetary financial assets, such as equities classified as available for sale,
are included in other comprehensive income.
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency
different from the presentation currency are translated into the presentation currency as follows:
t BTTFUTBOEMJBCJMJUJFTGPSFBDITUBUFNFOUPGmOBODJBMQPTJUJPOQSFTFOUFEBSFUSBOTMBUFEBUUIFDMPTJOHSBUFBUUIFEBUFPGUIBUTUBUFNFOUPGmOBODJBM
position;
t JODPNFBOEFYQFOTFTGPSFBDIJODPNFTUBUFNFOUTPSTFQBSBUFJODPNFTUBUFNFOUQSFTFOUFEBSFUSBOTMBUFEBUUIFBWFSBHFFYDIBOHFSBUFT VOMFTT
this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and
expenses are translated at the rate on the dates of the transactions); and
t BMMSFTVMUJOHFYDIBOHFEJGGFSFODFTBSFSFDPHOJTFEBTBTFQBSBUFDPNQPOFOUPGPUIFSDPNQSFIFOTJWFJODPNF
On consolidation, exchange differences arising from the translation of the net investment in foreign entities, and of borrowings and other financial
instruments designated as hedges of such investments are recognised in other comprehensive income.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at
the closing rates. Exchange differences arising are recognised in other comprehensive income.
On the disposal of a foreign operation (that is, a disposal of the Group’s entire interest in a foreign operation, or a disposal involving loss of control over a
subsidiary that includes a foreign operation, a disposal involving loss of joint control over a jointly controlled entity that includes a foreign operation, or a
disposal involving loss of significant influence over an associate that includes a foreign operation), all of the exchange differences relating to that foreign
operation recognised in other comprehensive income and accumulated in the separate component of equity are reclassified to the income statements. In
the case of a partial disposal that does not result in the Group losing control over a subsidiary that includes a foreign operation, the proportionate share
of accumulated exchange differences are re-attributed to non-controlling interests and are not recognised in the income statements. For all other partial
disposals (that is, reductions in the Group’s ownership interest in associates or jointly controlled entities that do not result in the Group losing significant
influence or joint control) the proportionate share of the accumulated exchange difference is reclassified to income statements.
X DEFERRED REVENUE
Deferred revenue represents unearned revenue from web-site maintenance contracts, leasing and car park operations which will be recognised in profit or loss
upon expiry, utilisation or performance of services.
Y SEGMENT REPORTING
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision
maker, who is responsible for allocating resources and assessing performance of the operating segment, has been identified as the Board of Directors that makes
strategic decisions.
Segment reporting is presented for enhanced assessment of the Group’s risks and returns. Business segments provide products or services that are subject to
risk and returns that are different from those of other business segments.
Segment revenue, expenses, assets and liabilities are those amounts resulting from the operating activities of a segment that are directly attributable to the
segment and the relevant portion that can be allocated on a reasonable basis to the segment. Segment revenue, expenses, assets and liabilities are deter-
mined before intragroup balances and intragroup transactions are eliminated as part of the consolidation process.
Compound financial instruments issued by the Group comprise convertible notes that can be converted to equity share capital at the option of the holder, and
the number of equity shares to be issued does not vary with changes in their fair value.
The liability component of a compound financial instrument is recognised initially at the fair value of a similar liability that does not have an equity conversion
option. The equity compound is recognised initially at the difference between the fair value of the compound financial instruments as a whole and the fair value
of the liability component. Any directly attributable contribution costs are allocated to the liability and equity components in proportion to their initial carrying
amounts.
Subsequent to initial recognition, the liability component of a compound financial instrument is measured at amortised cost using the effective interest method
until extinguished on conversion or maturity of the compound instrument. The equity component of a compound financial instrument is not remeasured
subsequent to initial recognition except when the compound instrument is redeemed or repurchased before maturity. The equity instrument component is subject
to deferred tax liability which is charged directly to equity.
Upon conversion of the compound instrument into equity shares, the amount credited to ordinary share capital and share premium is the aggregate of the
carrying amounts of the liability components classified within liability and equity component at the time of conversion. No gain or loss is recognised.
1 GENERAL INFORMATION
The principal activities of the Company during the financial year are those of investment holding and the provision of management services. The principal
activities of the Group mainly consist of property investment and management, owner and operator of malls, hotel operations,property development, construction,
information and communication technology services, provision of engineering services for water treatment plants and related services, aquaculture, education,
investment holding and management of real estate investment trust.
The Group’s activities expose it to a variety of financial risks: market risk (including foreign currency exchange risk and cash flow interest rate risk), credit risk,
price risk and liquidity and cash flow risk. The Group’s overall financial risk management objective is to ensure that the Group creates value for its shareholders.
The group focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group. Financial
risk management is carried out through risk reviews, internal control systems, insurance programmes and adherence to Group financial risk management policies.
The management regularly reviews these risks and approves the treasury policies, which covers the management of these risks.
The debt-financed acquisition of IGB during the year resulted in a change to the financial risks faced by the Group, specifically exposure to liquidity and capital
risk. The Group initially funded the acquisition through drawing on a RM1.6 billion initial short term facility. Subsequent to the Group’s financial year ended 31
December 2014, this initial short term facility was partially refinanced via the issuance of RM455.7 million Redeemable Convertible Cumulative Preference Share
(“RCPS”). The terms of RCPS are set out in Note 29 to the financial statements. The Group is reviewing the remaining amount of RM1.1 billion of the initial short
term facility with longer term loan facilities in mitigating the Group’s liquidity and cash flow risk.
The Group and the Company is exposed to foreign currency risk as a result of advances from/(to) subsidiaries,advances from/(to) associates, deposits with
licensed banks and borrowings denominated in Great Britain Pound (“GBP”), United States Dollar (“USD”), Australian Dollar (“AUD”), Hong Kong Dollar (“HKD”),
Euro (“EUR”) and Singapore Dollar (“SGD”). Management regularly monitors the foreign exchange currency fluctuations.
Currency risks as defined by MFRS 7 ‘Financial Instruments: Disclosure’ arise on account of monetary assets and liabilities being denominated in a
currency that is not the functional currency.
As at 31 December 2014, the Group’ sand the Company’s Ringgit Malaysia (“RM”) foreignunctional currency had GBP, USD, AUD, HKD, EUR and SGD
denominated net monetary assets/(liabilities) are as tabled below risk exposure is tabled below together with the effects to the Group and the Company
profit before tax, had the GBP, USD, AUD, HKD, EUR and SGD strengthened by 2% (31.12.2013: 2%, 1.2.2013: 2%) against RM, the profit before tax
would (decrease)/increase as follows:
Group
Restated Restated
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
Company
Restated Restated
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
A 2% (31.12.2013: 2%, 1.2.2013: 2%) weakening of RM against the above currencies at the end of the reporting period would have an equal but
opposite effect on the above currencies to the amount shown above, on the basis that all other variables remain constant.
Except as disclosed above, foreign currency exchange risks exposures are not material and did not have any significant impact on the financial
statements of the Group and of the Company at the reporting date, hence sensitivity analysis is not presented.
The Group’s cash flow interest rate risk arises from a floating rate term loan and revolving credit.
The information on maturity dates and effective interest rates of these borrowings is disclosed in Note 36.
The Group’s interest rate exposure is co-related with changes in cost of funds (“COF”) of the lenders. The impact on the Group’s profit after tax arising
from changes in COF of the lenders by 25 (31.12.2013 : 25) basis points arising from the Group’s floating rate term loan and revolving credits with
all other variables being held constant, would be as follows:
Group
31.12.2014 31.12.2013
RM’000 RM’000
Credit risk arises when sales are made on deferred credit terms. The Group and the Company control these risks by the application of credit approvals, limits
and monitoring procedures. Credit risks are minimised and monitored by strictly limiting the Group’s and the Company’s associations to business partners
with high creditworthiness. Trade receivables are monitored on an ongoing basis via the Group’s and the Company’s management reporting procedures. The
Group and the Company do not have any significant exposure to any individual customer or counterparty nor do they have any major concentration of credit
risk related to any financial instrument.
The credit quality of trade receivables that are neither past due nor impaired are substantially amounts due from customers with good collection track record
with Group and the Company. Management will continuously monitor closely the trade receivables which are past due.
Due to these factors, no additional credit risk beyond amounts allowed for collection losses is inherent in the Group’s and the Company’s trade receivables.
The Group and the Company do not have any significant credit risk from their property development activities as theirproducts are predominantly rendered
and sold to a large number of property purchasers using financing from reputable end-financiers.
Credit risks with respect to trade receivables are limited as the legal title to the properties sold remain with the Group until the purchase consideration is
fully paid.
Credit risk arising from property investment –office towers and malls
Credit risk with respect to rental receivables is limited due to the nature of business which is predominantly rental receivables in advance. Furthermore, the
tenants have placed security deposits with the Group which acts as collateral if receivables due from the tenant are not of settled or in case of breaches
of contract. Due to these factors, no additional credit risk beyond amounts allowed for collection losses is inherent in the Group’s and the Company’s trade
receivables.
Credit risk with respect to amounts due from joint ventures’ are assessed to be low due to the nature of the property development activities as the legal title
to the properties is transferred only when the consideration is fully received.
Credit risk also arises from deposits with licensed banks and financial institutions. The deposits are placed with credit-worthy financial institutions with high
credit rating. The Group and the Company consider the risk of material loss in the event of non-performance by a financial counterparty to be unlikely.
As the Group and the Company do not hold any collateral, the maximum exposure to credit risk for each class of financial instruments is the carrying amount
of that class of financial instruments presented in the statement of financial position, except as follows:
Company
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
Corporate guaranteed provided to
banks on subsidiaries’ facilities 17,525 9,893 12,831
The Company does not have any significant exposure to any individual customer or counterparty nor does it have any major concentration of credit risk except
for amounts due from subsidiaries. The credit risks with respect to amounts due from subsidiaries are assessed to be low.
The Group and Company is exposed to debt and equity securities price risk because of investments held by the Group and Company and classified on the
statement of financial position either as available-for-sale or at fair value through profit or loss. To manage its price risk arising from investment in debt and
equity securities, the Group diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the Group. Thus, the exposure
of price risk of the Group and Company is minimal.
The Group’s investments in the debt and equity securities are listed on the Bursa Malaysia Securities Berhad (“Bursa Malaysia”), New York Stock Exchange,
Singapore Stock Exchange, Australian Securities Exchange, Tokyo Stock Exchange, Hong Kong Stock Exchange and Euronext Paris.
The Group actively manages its debt maturity profile, operating cash flows and the availability of funding so as to ensure that all refinancing, repayment and
funding needs are met. As part of its overall prudent liquidity management, the Group maintains sufficient levels of cash or cash convertible investments 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
short term funding so as to achieve overall cost effectiveness.
At 31 December 2014, the Group held cash and cash equivalents of RM744,980,000 (31.12.2013: RM1,061,428,000, 1.2.2013: RM2,057,498,000)
that are expected to readily generate cash inflows for managing liquidity risk.
The table below analyses the Group’s and the Company’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period
at the reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows:
Between Between
Less than 1 and 2 2 and 3 Over
Note 1 year years years 3 years Total
RM’000 RM’000 RM’000 RM’000 RM’000
Group
At 31.12.2014
At 31.12.2013 (restated)
Between Between
Less than 1 and 2 2 and 3 Over
Note 1 year years years 3 years Total
RM’000 RM’000 RM’000 RM’000 RM’000
Group
At 1.2.2013 (restated)
Company
31.12.2014 31.12.2013 1.2.2013
Less than Less than Less than
Note 1 year 1 year 1 year
RM’000 RM’000 RM’000
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders
and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, issue new shares or sell assets to
reduce debts.
The debt to equity ratio is calculated as net debt divided by total equity. Net debt is calculated as total borrowings (excluding payables and contract liabilities)
less deposit, cash and bank balances.
The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as interest bearing net debt divided by total equity. Interest bearing
liabilities is calculated as total interest bearing bank borrowings and hire-purchase and finance lease payables (including short term and long term borrowings)
as shown in the statement of financial position.
The Group also monitors capital based on the gearing ratio computed based on an adjusted equity attributable to owners of the parent. The adjustment
reflects the fair value of the Group’s investment properties, which is recorded on the cost model in the Group’s financial statements.
Restated Restated
31.12.2014 31.12.2013 31.1.2013
RM’000 RM’000 RM’000
Group
Company
Assets at fair
Available- value through Loans and
for-sale profit or loss receivables Total
RM’000 RM’000 RM’000 RM’000
Group
At 31.12.2014
Non-current
Available-for-sale financial assets 12,638 - - 12,638
Concession receivables - - 74,739 74,739
Current
Financial assets at fair value through profit or loss - 24,882 - 24,882
Concession receivables - - 2,113 2,113
Amounts owing from associates and joint ventures - - 54,750 54,750
Amount owing from a related company - - 42 42
Receivables and contract assets (excluding prepayments,
accrued billings and contract assets) - - 103,694 103,694
Cash held under Housing Development Accounts - - 40,500 40,500
Deposits, cash and bank balances - - 1,214,286 1,214,286
Other financial
liabilities at
amortised cost Total
RM’000 RM’000
Group
At 31.12.2014
Non-current
Payables and contract liabilities 70,169 70,169
Hire-purchase and finance lease payables 124 124
Interest bearing bank borrowings 1,571,267 1,571,267
Current
Payables and contract liabilities (excluding deferred revenue and contract liabilities) 515,496 515,496
Hire-purchase and finance lease payables 70 70
Interest bearing bank borrowings 2,317,903 2,317,903
Amounts owing to associates 2,697 2,697
Assets at fair
Available- value through Loans and
for-sale profit or loss receivables Total
RM’000 RM’000 RM’000 RM’000
Group
At 31.12.2013 (Restated)
Non-current
Available-for-sale financial assets 9,857 - - 9,857
Concession receivables - - 57,703 57,703
Current
Available-for-sale financial assets 49,914 - - 49,914
Financial assets at fair value through profit or loss - 16,927 - 16,927
Concession receivables - - 6,198 6,198
Amounts owing from associates and joint ventures - - 86,758 86,758
Amount owing from a related company - - 22 22
Receivables and contract assets (excluding prepayments,
accrued billings and contract assets) - - 130,757 130,757
Cash held under Housing Development Accounts - - 32,984 32,984
Deposits, cash and bank balances - - 1,152,170 1,152,170
Other financial
liabilities at
amortised cost Total
RM’000 RM’000
Group
At 31.12.2013 (Restated)
Non-current
Payables and contract liabilities 73,405 73,405
Hire-purchase and finance lease payables 194 194
Interest bearing bank borrowings 1,484,909 1,484,909
Current
Payables and contract liabilities (excluding deferred revenue and contract liabilities) 491,079 491,079
Hire-purchase and finance lease payables 75 75
Interest bearing bank borrowings 263,288 263,288
Amounts owing to associates and joint ventures 4,107 4,107
Assets at fair
Available- value through Loans and
for-sale profit or loss receivables Total
RM’000 RM’000 RM’000 RM’000
Group
At 1.2.2013 (Restated)
Non-current
Available-for-sale financial assets 50 - - 50
Concession receivables - - 43,161 43,161
Current
Available-for-sale financial assets 58,809 - - 58,809
Financial assets at fair value through profit or loss - 13,424 - 13,424
Concession receivables - - 9,595 9,595
Amounts owing from associates and joint ventures - - 66,025 66,025
Receivables and contract assets excluding prepayments,
accrued billings and contract assets) - - 186,082 186,082
Cash held under Housing Development Accounts - - 5,259 5,259
Deposits, cash and bank balances - - 2,174,970 2,174,970
Other financial
liabilities at
amortised cost Total
RM’000 RM’000
Group
At 1.2.2013 (Restated)
Non-current
Payables and contract liabilities 64,723 64,723
Hire-purchase and finance lease payables 144 144
Interest bearing bank borrowings 1,526,581 1,526,581
Current
Payables and contract liabilities (excluding deferred revenue and contract liabilities) 383,569 383,569
Hire-purchase and finance lease payables 70 70
Interest bearing bank borrowings 362,851 362,851
Amounts owing to associates and joint ventures 22,487 22,487
Assets at fair
Available- value through Loans and
for-sale profit or loss receivables Total
RM’000 RM’000 RM’000 RM’000
Company
At 31.12.2014
Non-current
Available-for-sale financial assets 12,588 - - 12,588
Current
Financial assets at fair value through profit or loss - 12,950 - 12,950
Amount owing from subsidiaries - - 5,420 5,420
Receivables and contract assets (excluding prepayments) - - 1,858 1,858
Deposits, cash and bank balances - - 72,383 72,383
Liabilities at
Other financial fair value
liabilities at through profit
amortised cost and loss Total
RM’000 RM’000 RM’000
Current
Payables and contract liabilities 4,630 - 4,630
Advances from subsidiaries 1 - 1
Interest bearing bank borrowings 1,545,120 - 1,545,120
Assets at fair
Available- value through Loans and
for-sale profit or loss receivables Total
RM’000 RM’000 RM’000 RM’000
Company
At 31.12.2013
Non-current
Available-for-sale financial assets 9,807 - - 9,807
Current
Available-for-sale financial assets 49,069 - - 49,069
Financial assets at fair value through profit or loss - 16,533 - 16,533
Amount owing from subsidiaries - - 42,116 42,116
Receivables and contract assets (excluding prepayments) - - 1,725 1,725
Deposits, cash and bank balances - - 88,583 88,583
Liabilities at
Other financial fair value
liabilities at through profit
amortised cost and loss Total
RM’000 RM’000 RM’000
Current
Payables and contract liabilities 459 - 459
Advances from subsidiaries 26 - 26
Assets at fair
Available- value through Loans and
for-sale profit or loss receivables Total
RM’000 RM’000 RM’000 RM’000
Company
At 1.2.2013
Current
Available-for-sale financial assets 56,224 - - 56,224
Financial assets at fair value through profit or loss - 12,920 - 12,920
Amount owing from subsidiaries - - 53,928 53,928
Receivables and contract assets (excluding prepayments) - - 8,120 8,120
Deposits, cash and bank balances - - 43,383 43,383
Liabilities at
Other financial fair value
liabilities at through profit
amortised cost and loss Total
RM’000 RM’000 RM’000
Current
Payables and contract liabilities 489 - 489
Advances from subsidiaries 26 - 26
Financial guarantee contract - 29 29
The carrying amounts of financial assets and liabilities such as deposit, cash and bank balances, current receivables and payables approximate their fair
values due to the relatively short-term maturity of these financial instruments.
The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:
t 2VPUFEQSJDFT VOBEKVTUFE
JOBDUJWFNBSLFUTGPSJEFOUJDBMBTTFUTPSMJBCJMJUJFT -FWFM
t *OQVUTPUIFSUIBORVPUFEQSJDFTJODMVEFEXJUIJO-FWFMUIBUBSFPCTFSWBCMFGPSUIFBTTFUPSMJBCJMJUZ
FJUIFSEJSFDUMZ UIBUJT
BTQSJDFT
PSJOEJSFDUMZ UIBUJT
derived from prices) (Level 2);
t *OQVUTGPSUIFBTTFUPSMJBCJMJUZUIBUBSFOPUCBTFEPOPCTFSWBCMFNBSLFUEBUB UIBUJT
VOPCTFSWBCMFJOQVUT
-FWFM
The following table presents the Group’s and the Company’s assets and liabilities that are measured at fair value:
Group
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
Level 1
Financial assets at fair value through profit or loss
- trading securities 24,882 16,927 13,424
Available-for-sale financial assets
- equity securities - 49,914 58,809
Level 2
Available-for-sale financial assets
- equity securities 12,588 9,807 -
Level 3
Available-for-sale financial assets
- equity securities 50 - -
Company
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
Level 1
Financial assets at fair value through profit or loss
- trading securities 12,950 16,533 12,920
Available-for-sale financial assets
- equity securities - 49,069 56,224
Level 2
Available-for-sale financial assets
- equity securities 12,588 9,807 -
Estimates and judgements are continually evaluated by the Directors and are based on historical experience and other factors, including expectations of future
events that are believed to be reasonable under the circumstances.
The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results.
The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next
financial year are as follows:
Assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Significant
judgement is required in the estimation of the present value of future cash flows generated by the assets, which involves uncertainties and are significantly
affected by assumptions used and judgement made regarding estimates of future cash flows and discount rates. Changes in assumptions can significantly
affect the results of the Group’s test for impairment of assets.
The Group recognises property development revenue and costs by reference to the progress towards complete satisfaction of that performance obligation at
the reporting date. This is measured based on direct measurements of the value transferred by the Group to the customer and the Group’s efforts or budgeted
inputs to the satisfaction of the performance obligation. Significant judgement is required in determining:
t UIFDPNQMFUFOFTTBOEBDDVSBDZPGUIFCVEHFUT
t UIFFYUFOUPGUIFDPTUTJODVSSFE
Substantial changes in cost estimates can in future periods have, a significant effect on the Group’s profitability. In making the above judgement, the Group
relies on past experience and work of specialists.
There is no estimation required in determining the transaction prices as revenue from property development are based on contracted prices.
(c) Taxation
Significant judgement is required in determining the provision for income taxes. There are transactions and calculations for which the ultimate tax determination
is uncertain during the ordinary course of business. The Group recognises liabilities for tax based on estimates of assessment of the tax liability due. When
the final tax outcome is different from the amount that were initially recorded, such differences will impact the income tax and deferred tax provisions, where
applicable, in the period in which such determination is made.
Recognition of deferred tax assets, which principally relate to tax losses, depends on the expectation of future taxable profits that will be available against
which tax losses can be utilised. This involves judgement regarding the future financial performance of the particular entity in which the deferred tax asset
has been recognised.
4 SEGMENT REPORTING
Segment reporting is presented for enhanced assessment of the Group’s risks and returns. Business segments provide products or services that are subject to
risk and returns that are different from those of other business segments.
Management has determined the operating segments based on the various reports prepared for the Board of Directors that are used to make strategic decisions.
During the financial year, the composition of the operating segments of the Group has been disaggregated further into six reportable segments as described
below to streamline the focus of the Board of Directors in making its strategic decision across the segments effectively. This change has been adjusted for
retrospectively.
(a) Property investment – retail - rental income and service charge from retail
(b) Property investment – commercial - rental income and service charge from office building
(c) Property development - development and sale of condominiums, bungalows,
linked houses, shoplots and office suites and project management services
(d) Hotel - income from hotel operations
(e) Construction - civil and building construction
(f) Investment holding - income from investing activities
Other operations of the Group mainly comprise sale of utilities, education services, waste water treatment services, information and communication technology
and other operations; none of which are of a significant size to be reported separately.
The revenue from the respective operating segments (property development, property investment – retail, property investment – commercial, and hotel) includes
incidental revenue generated within the respective segments that have been reclassified by their nature for presentation within the revenue note.
Segment revenue, expenses, assets and liabilities are determined before intragroup balances and intragroup transactions are eliminated as part of the consolidation
process.
The results of Macro Kiosk Berhad and its subsidiaries are presented as profit after taxation from discontinued operations (Note 6) as the disposal of Macro Kiosk
Berhad was completed on 19 July 2013. Macro Kiosk Berhad and its subsidiaries are part of the others business segment.
Property Property
investment investment Property Investment
- retail - commercial development Hotel Construction holding Others Group
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Total segment revenue 485,603 212,818 184,837 376,797 419,713 16,937 152,204 1,848,909
Inter-segment revenue (35,779) (19,660) - (8,591) (412,286) (13,367) (70,247) (559,930)
Segment results 282,394 103,133 96,600 31,284 6,518 13,464 (11,468) 521,925
Unallocated expenses (42,964)
At 31.12.2014
Other information:
Assets
Segment assets 1,433,498 1,371,757 475,537 2,175,715 130,825 33,854 257,760 5,878,946
Associates 824,690
Unallocated assets:
- Deposits, cash and bank balances 1,151,890
- Others 103,000
Liabilities
Segment liabilities 1,419,527 344,636 238,261 341,756 135,055 1,536,587 462,254 4,478,076
Property Property
investment investment Property Investment
- retail - commercial development Hotel Construction holding Others Group
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Depreciation of property,
plant & equipment 2,116 4,234 1,597 61,648 38 81 4,895 74,609
Amortisation:
- Investment properties 27,808 36,833 - - - - - 64,641
- Intangible assets - - - - - - 262 262
- Biological assets - - - - - - 130 130
- Long term prepaid lease - - - 241 - - - 241
Write-off:
- Property, plant and equipment - 197 6 45,293 - - - 45,496
Impairment of:
- Property, plant and equipment - - - 10,905 - - - 10,905
Reversal of impairment:
- Property, plant and equipment - - - 7,425 - - - 7,425
- Land held for property
development - - 21,036 - - - - 21,036
Total segment revenue 415,174 189,895 138,243 360,413 193,511 73,212 96,296 1,466,744
Inter-segment revenue (34,150) (11,506) - (7,463) (187,436) (71,043) (40,275) (351,873)
Segment results 204,579 95,760 73,779 91,544 2,311 (691) (1,213) 466,069
Unallocated expenses (42,800)
Property Property
investment investment Property Investment
- retail - commercial development Hotel Construction holding Others Group
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
At 31.12.2013 (Restated)
Other information:
Assets
Segment assets 1,286,602 1,393,476 413,799 2,084,530 132,061 82,450 212,905 5,605,823
Associates 387,723
Unallocated assets 1,185,257
Liabilities
Segment liabilities 1,432,149 319,519 263,597 181,977 81,090 514 43,117 2,321,963
Depreciation of property,
plant & equipment 1,805 3,838 1,504 69,100 37 74 2,133 78,491
Amortisation:
- Investment properties 27,808 35,807 - - - - - 63,615
- Intangible assets - - - - - - 259 259
- Biological assets - - - - - - 132 132
- Long term prepaid lease - - - 234 - - - 234
Impairment loss:
- Property, plant and equipment - - - - - - 166 166
Write-off:
- Property, plant and equipment - - 22 10,495 - - 241 10,758
The segmental financial information by geographical segment is not presented as the Group’s activities are mainly carried out in Malaysia.
(i) On 12 August 2014, the Group via its subsidiary, IGB Corporation Berhad ("IGB") announced to Bursa Malaysia that Pacific Land Sdn Bhd, a wholly
owned subsidiary of IGB, had acquired the entire issued and paid-up share capital of 2 ordinary shares of RM1.00 each in a company incorporated
in Malaysia known as Majestic Path Sdn Bhd for a cash consideration of RM2.00.
(ii) On 19 September 2014, the Group announced to Bursa Malaysia that Goldis had subscribed for 8 ordinary shares of RM1.00 each, representing 80%
equity interest in AFMS Solutions Sdn Bhd for a cash consideration of RM8.00.
(iii) On 29 September 2014, the Group announced to Bursa Malaysia that Goldis had acquired the entire issued and paid-up share capital of 2 ordinary
shares of RM1.00 each in Perfect Encore Sdn Bhd for a cash consideration of RM2.00.
(iv) On 29 September 2014, the Group announced to Bursa Malaysia that Goldis had acquired the entire issued and paid-up share capital of 2 ordinary
shares of RM1.00 each in Genius Momentum Sdn Bhd for a cash consideration of RM2.00.
(v) On 27 October 2014, the Group announced to Bursa Malaysia that Goldis had acquired the entire issued and paid-up share capital of 2 ordinary
shares of RM1.00 each in Silver Sanctuary Sdn Bhd, for a cash consideration of RM2.00.
(i) On 23 July 2014, Goldis had acquired additional 6,000,000 ordinary shares of RM0.50 each in IGB representing approximately 0.45% of the issued
and paid-up share capital of IGB for a cash consideration of RM17,272,860.
(ii) On 6 November 2014, Goldis had acquired additional equity interest of 40.68% in IGB for a cash consideration of RM1,564,173,812. Upon this
completion of acquisition, Goldis effective equity interest in IGB increase to 73.32% of the issued and paid-up share capital of IGB (excluding treasury
shares).
On 7 June 2013, Verokey Sdn Bhd (“Verokey”), a wholly-owned subsidiary of IGB had entered into a Joint Venture Agreement with Tower Ray Limited
for the establishment of a joint venture through an equity participation of 50:50 in Black Pearl for cash consideration of RM27,545.The Joint Venture
Agreement became unconditional upon Verokey subscription of 50% equity interest in Black Pearl on 8 May 2014.
On 8 May 2014, the Black Pearl entered into a Share Purchase Agreement with Panthermane Limited (“Panthermane”) and Ostingale Limited
(collectively, the “Sellers”), for the acquisition of 10,000 ordinary shares of GBP1.00 each in Blackfriars Limited (“Blackfriars”) representing 100% of
the issued share capital of Blackfriars.
Blackfriars is the registered owner of certain land and buildings, measuring approximately 1.81 acres (0.73 hectares)(the “Property”).
The total consideration for the acquisition of Blackfriars is set out below:
(a) acquisition of 10,000 ordinary shares of GBP1.00 each in Blackfriars for RM5.00 (GBP1.00) (“Sale Shares”);
(b) settlement of RM358.2 million (GBP65.0 million) being the outstanding sum including any and all interest accruing, fees and penalties owed by
the Sellers to the National Asset Management Agency (“NAMA Debt”) for the latter to release its security over the Property; and
(c) assumption by Black Pearl of RM271.4 million (GBP49.262 million) in loans from Panthermane to Blackfriars.
The joint venture intends to develop the property into a mixed residential and commercial development involving amongst others, residential units,
offices and retail.
On 26 September 2014, Majestic Path Sdn Bhd, a wholly-owned subsidiary of Pacific Land Sdn Bhd which in turn is a wholly-owned subsidiary of IGB
had entered into a Shareholder Agreement with Immortal Group Co. Ltd and Theekharoj Piamphongsarn in relation to 49% stake in Crystal Property
for cash consideration of RM65,621,000. The joint venture is to carry on the development of 19 freehold land plots located in Bangkok, Thailand.
On 30 September 2014, Tan & Tan Developments Berhad, a wholly-owned subsidiary of IGB had disposed 30% of its equity interest in its wholly-owned
subsidiary, Cipta Klasik (M) Sdn Bhd for a cash consideration of RM41,244,000.
6 DISPOSAL OF A SUBSIDIARY
On 8 July 2013, the Group entered into a Shares Sale Agreement with Mr. Goh Chee Ken, Mr. Goh Chee Heng and Mr. Goh Chee Seng (“the Purchaser”)
for the disposal of the 70% of the issued and paid-up share capital of Macro Kiosk Berhad ("MKB").
On 19 July 2013, the Company had completed the disposal of its entire equity interest in MKB, comprising 3,500,000 ordinary shares of RM1.00 each for
a net disposal proceed of RM22.3 million.
Following the completion of the disposal, MKB ceased to be a subsidiary of the Company.
At date of disposal
RM’000
4,285
Net disposal proceeds (22,315)
B DISCONTINUED OPERATIONS
The financial information relating to the discontinued operations for the period up to the date of disposal is set out below:
(i) Results
Group
Restated
11 months
period ended
31.12.2013
RM’000
Revenue 69,160
Cost of sales (51,562)
Revenue
Cost of sales
51,562
Group
Restated
11 months
period ended
31.12.2013
RM’000
Operating profit
Finance income:
- interest income on deposits with licensed banks 58
Taxation
Current tax:
- Malaysia tax 160
- Foreign tax 306
466
Deferred tax -
(325)
(iii) Details of the assets in the disposal group classified as held for sale at the end of the previous financial year are as follows:
Group
Restated
1.2.2013
RM’000
71,331
Company
Restated
1.2.2013
RM’000
Subsidiaries:
- Investment in subsidiaries 3,500
- Advances to subsidiaries 10,654
14,154
(iv) Details of the liabilities in the disposal group classified as held for sale at the end of the previous financial year are as follows:
Group
Restated
1.2.2013
RM’000
56,290
7 REVENUE
Group Company
Restated
11 months 11 months
Year ended period ended Year ended period ended
31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
Lease income:
- retail malls 324,934 280,505 - -
- office buildings 196,209 174,303 - -
- rent and rent related 109,656 90,121 - -
Contract with customers:
- hotel room revenue 261,131 247,381 - -
- property development revenue
- sale of properties 175,454 132,981 - -
- property management fees and others 2,554 4,800 - -
- sale of food and beverages 99,128 95,657 - -
- rendering of services 26,192 17,825 - -
- construction contract revenue 7,427 7,187 - -
- contract revenue relating to service
concession arrangement 16,138 19,469 - -
- utilities 64,380 40,961 - -
- management services - - 2,096 401
- others 2,153 1,444 - -
Investment income 3,623 2,237 - -
Dividend income (gross) - - 13,801 70,824
Interest income on advances to subsidiaries - - 1,040 1,987
8 OPERATING PROFIT
Group Company
Restated Restated
11 months 11 months
Year ended period ended Year ended period ended
31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
and crediting:
Group Company
11 months 11 months
Year ended period ended Year ended period ended
31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
10 DIRECTORS’ REMUNERATION
The aggregate amount of emoluments received/receivable by the Directors of the Group and of the Company during the financial year/period are as follows:
Group Company
11 months 11 months
Year ended period ended Year ended period ended
31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
Fees:
- directors of the Company 274 125 174 125
- director of the subsidiaries 550 99 - -
Other emoluments:
- directors of the Company 9,897 1,271 1,789 1,271
- director of the subsidiaries 8,300 668 - -
Defined contribution plan 2,156 216 215 136
Benefits-in-kind 170 70 7 7
Group Company
11 months 11 months
Year ended period ended Year ended period ended
31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
12 TAXATION
Group Company
Restated
11 months 11 months
Year ended period ended Year ended period ended
31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
Current tax:
- Malaysian tax 103,494 88,917 945 13,155
- Foreign tax 5,605 4,209 - -
Current tax:
Current year/period 109,124 96,007 945 13,159
Over accrual in prior financial year (25) (2,881) - (4)
12 TAXATION (CONTINUED)
The reconciliation between the effective tax rate and the Malaysian tax rate are as follows:
Group Company
Restated
11 months 11 months
Year ended period ended Year ended period ended
31.12.2014 31.12.2013 31.12.2014 31.12.2013
% % % %
* Less than 1%
Pursuant to Section 61A of Malaysia Income Tax Act, 1967 (“Act”), income of IGB Real Estate Investment Trust (“IGB REIT”) will be exempted from tax provided
that at least 90% of its taxable income (as defined in the Act) is distributed to the investors in the basis period of IGB REIT for that year of assessment within two
(2) months after the close of financial year. If the 90% distribution condition is not complied with or the 90% distribution is not made within two (2) months after
the close of IGB REIT’s financial year which forms the basis period for a year of assessment, then IGB REIT will be subject to income tax at the prevailing rate on
its total income. Income which has been taxed at the IGB REIT level will have tax credits attached when subsequently distributed to unit holders.
Basic earnings per share of the Group is calculated by dividing the profit attributable to equity holders of the Company for the financial year by the weighted
average number of ordinary shares in issue during the financial year/period, excluding ordinary shares purchased by the Company and held as treasury shares
(Note 31).
Group
Restated
11 months
Year ended period ended
31.12.2014 31.12.2013
16.93 17.17
Diluted earnings per share equals to basic earnings per share as there are no potential dilutive shares in issue.
Furniture,
Hotel fixtures, Capital
Freehold Leasehold properties Plant and fittings and Motor work-in-
Group land land (Note 14(a)) Buildings machinery equipment vehicles progress Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
31.12.2014
Cost
At 1 January 2014 56,696 2,279 2,080,970 3,725 24,609 66,387 9,024 186,605 2,430,295
Additions - - 23,527 1,231 118 5,801 570 252,573 283,820
Transferred from investment
properties (Note 16) 4,000 - - - - - - - 4,000
Transferred to property
development costs (Note 15(b)) (13) - - - - - - - (13)
Reclassification - - 17,479 102,371 178 4,300 - (124,328) -
Written off - - (54,624) - - (595) - - (55,219)
Disposals - - (352) - - (51) (1,013) - (1,416)
Currency translation differences - 30 2,085 - - 7 41 (2,071) 92
At 31 December 2014 60,683 2,309 2,069,085 107,327 24,905 75,849 8,622 312,779 2,661,559
Accumulated depreciation
At 1 January 2014 - 493 331,169 519 5,280 34,848 6,319 - 378,628
Charge for the financial year - 46 61,383 1,284 1,190 9,955 751 - 74,609
Written off - - (9,332) - - (391) - - (9,723)
Disposals - - (128) - - (10) (793) - (931)
Currency translation differences - 11 2,177 - - 4 23 - 2,215
Furniture,
Hotel fixtures, Capital
Freehold Leasehold properties Plant and fittings and Motor work-in-
Group land land (Note 14(a)) Buildings machinery equipment vehicles progress Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
31.12.2014
31.12.2013 (restated)
Cost
At 1 February 2013:
- At cost/valuation 15,366 2,222 1,915,603 3,725 16,400 83,959 8,002 88,661 2,133,938
- Effects of transitioning
to MFRS - - 45,876 - - - - - 45,876
As restated 15,366 2,222 1,961,479 3,725 16,400 83,959 8,002 88,661 2,179,814
At 31 December 2013 56,696 2,279 2,080,970 3,725 24,609 66,387 9,024 186,605 2,430,295
Furniture,
Hotel fixtures, Capital
Freehold Leasehold properties Plant and fittings and Motor work-in-
Group land land (Note 14(a)) Buildings machinery equipment vehicles progress Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
31.12.2013 (restated)
Accumulated depreciation
At 1 February 2013 - 430 217,346 499 4,800 49,279 6,239 - 278,593
- Effects of transitioning to MFRS - - 45,876 - - - - - 45,876
The write off and impairment of property, plant and equipment of RM45,496,000 (31.12.2013: RM10,758,000) and RM10,905,000 (31.12.2013: RM166,000) respectively have
been included within administrative expenses.
Office
furniture,
Freehold Hotel Plant and fittings and
land buildings machinery equipment Total
Group RM’000 RM’000 RM’000 RM’000 RM’000
31.12.2014
Cost
Accumulated depreciation
At 1 January 2014 - 89,601 49,315 192,253 331,169
Charge for the financial year - 25,841 4,355 31,187 61,383
Written off - (1,756) (2,885) (4,691) (9,332)
Disposals - - - (128) (128)
Currency translation differences - 1,048 748 381 2,177
31.12.2013 (restated)
Cost
At 1 February 2013:
At cost/valuation 303,000 1,303,357 52,978 256,268 1,915,603
- effects of transitioning to MFRS - - 13,936 31,940 45,876
As restated 303,000 1,303,357 66,914 288,208 1,961,479
Additions - 2,797 2,172 8,406 13,375
Transferred from investment properties (Note 16) 57,119 66,259 - - 123,378
Reclassification - (2,786) 124 4,050 1,388
Written offs - (8,652) (410) (1,375) (10,437)
Disposals - (2,589) (18) (17) (2,624)
Currency translation differences (4,554) (2,924) 1,404 485 (5,589)
Office
furniture,
Freehold Hotel Plant and fittings and
land buildings machinery equipment Total
Group RM’000 RM’000 RM’000 RM’000 RM’000
31.12.2013 (restated)
Accumulated depreciation
At 1 February 2013 - 60,114 29,389 127,843 217,346
- effects of transitioning to MFRS - - 13,936 31,940 45,876
As restated - 60,114 43,325 159,783 263,222
Charge for the financial period - 28,660 5,678 33,158 67,496
Transferred from investment properties (Note 16) - 1,715 - - 1,715
Written offs - (1,751) (399) (1,075) (3,225)
Disposals - - (1) (14) (15)
Currency translation differences - 863 712 401 1,976
Group
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
Net book value of assets pledged as borrowings (Note 36): 695,231 704,820 716,114
The carrying value of hotel properties of a subsidiary company in Kuala Lumpur was tested for impairment during the financial year due to losses incurred.
The impairment charge recognised in the financial statements of the Group is RM10,905,000 as the carrying value of the hotel properties exceeds the
recoverable amount.
The recoverable amount of the hotel properties of the subsidiary company is determined from the value in use calculation. The value in use calculation
applies a discounted cash flow model, based on an approved financial plan package. The financial plan reflects the subsidiary company’s expectation of
occupancy and average room rate, revenue growth rates, operating costs and margins based on past trends as well as the expectations of market and
industry growth.
The key estimates and assumptions used in the value in use calculation are as follows:
Discount rate 8%
Occupancy growth rate 3% per annum, terminal value 0%
Average room rate growth rate 5% per annum, terminal value 0%
Inflation rate 3% per annum
Based on the sensitivity analysis performed, the changes in estimates and the impact to value in use calculation are summarised as below:
Impact
Key estimates Change in estimates to value-in-use
RM’000
The impairment on the carrying value of property, plant and equipment of a subsidiary company in Yangon, Myanmar was tested for recoverability during
the financial year due to improved financial performance. The reversal of impairment recognised in the financial statements within administrative expense
of the Group is RM7,425,000 as the recoverable amount exceeds the carrying value of the property, plant and equipment.
The recoverable amount of the property, plant and equipment of the subsidiary company is determined from the value in use calculation. The value in
use calculation applies a discounted cash flow model, based on an approved financial plan package. The financial plan reflects the subsidiary company’s
expectation of occupancy and average room rate, revenue growth rates, operating costs and margins based on past trends as well as the expectations of
market and industry growth.
The key estimates and assumptions used in the value in use calculation are as follows:
Based on the sensitivity analysis performed, the changes in estimates and the impact to value in use calculation are summarised as below:
Impact
Key estimates Change in estimates to value-in-use
RM’000
Company
Cost
Accumulated depreciation
15 INVENTORIES
Group
Restated Restated
Note 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
Non-current
Land held for property development (a) 254,836 220,363 229,873
Current
Property development costs (b) 298,172 306,660 231,849
At cost:
Unsold properties 78,106 80,525 60,481
Hotel operating supplies 1,977 2,213 2,118
Raw materials 57 655 416
Work-in-progress 2 5 417
Finished goods 576 130 139
At fair value:
Biological assets - fish 373 144 -
15 INVENTORIES (CONTINUED)
Group
At net
realisable
Note At cost value Total
RM’000 RM’000 RM’000
31.12.2014
At 1 January
Land cost 50,729 98,636 149,365
Development costs 14,923 56,075 70,998
The write down on a subsidiary company’s inventories - land held for property development in Labu, Negeri Sembilan made in previous financial years
was assessed for recoverability due to improved market conditions in Labu. The reversal of write down recognised in the financial statements of the Group
is RM21,036,000 as the recoverable amount of the subsidiary company has improved as compared to previous years. The recoverable amount of the
development land held is determined by reference to the consideration received on compulsory acquisition of part of the development land by the state
authorities.
15 INVENTORIES (CONTINUED)
Group
At net
realisable
Note At cost value Total
RM’000 RM’000 RM’000
31.12.2013
At 1 February
Land cost 50,773 98,636 149,409
Development costs 24,389 56,075 80,464
(9,510) - (9,510)
15 INVENTORIES (CONTINUED)
Group
Restated
Note 31.12.2014 31.12.2013
RM’000 RM’000
At 1 January/At 1 February
At cost
Land and development costs 472,711 343,116
Accumulated costs charged to income statement (166,051) (117,249)
- as previously reported 306,660 225,867
- effects of early adoption of MFRS 15 - 5,982
- as restated 306,660 231,849
Less:
- Completed development properties:
Land and development costs - (69,532)
Accumulated costs charged to income statement - 69,532
Add:
- Costs incurred during the financial year/period:
Land and development costs
- as previously reported 122,188 224,181
- effects of early adoption of MFRS 15 - 1,411
- as restated 122,188 225,592
At 31 December
At cost 298,172 306,660
15 INVENTORIES (CONTINUED)
Group
Restated
Note 31.12.2014 31.12.2013
RM’000 RM’000
298,172 306,660
Land and development cost charged as security for borrowings 36 71,570 70,263
16 INVESTMENT PROPERTIES
Property Property
investment investment Capital work
Group retail commercial in progress Total
RM’000 RM’000 RM’000 RM’000
31.12.2014
Cost
At 1 January 2014 1,377,725 1,114,520 608,541 3,100,786
Additions - 1,768 199,412 201,180
Reclasssification - 8,590 (8,590) -
Reclassification to property, plant and equipment (Note 14) - (4,000) - (4,000)
Disposal - (338) - (338)
Accumulated depreciation
At 1 January 2014 402,328 221,127 - 623,455
Charge for the financial year 27,808 36,833 - 64,641
Property Property
investment investment Capital work
Group retail commercial in progress Total
RM’000 RM’000 RM’000 RM’000
31.12.2013
Cost
At 1 February 2013 1,377,725 1,246,128 217,904 2,841,757
Acquisition of a subsidiary - - 44,956 44,956
Additions - 4,303 346,479 350,782
Reclassification to property, plant and equipment (Note 14) - (135,911) (798) (136,709)
Accumulated depreciation
At 1 February 2013 374,520 187,035 - 561,555
Charge for the financial period 27,808 35,807 - 63,615
Reclassification to property, plant and equipment (Note 14) - (1,715) - (1,715)
Direct operating expenses from investment properties that generated rental income of the Group during the financial year amounted to approximately
RM252,901,000 (31.12.2013: RM222,455,000).
Included in direct operating expenses of the Group’s investment properties were the following expenses:
Group
11 months
Year ended period ended
31.12.2014 31.12.2013
RM’000 RM’000
Fair Value
31.12.2014 31.12.2013 01.2.2013 Valuation
RM’000 RM’000 RM’000 Level Technique
The fair value of the investment properties above were estimated based on either valuations by independent qualified valuers or management’s estimates.
The fair value of the investment properties above excludes investment properties that are under construction as the fair value of these properties are not expected
to be reliably measurable until construction completes.
The fair value of the investment properties is determined based on income approach using Level 3 inputs in the fair value hierarchy of MFRS 13 ‘Fair Value
Measurement’. The fair value of the investment properties is derived from an estimate of the market rental which the investment properties can reasonably be
let for. Outgoings such as quit rent and assessment, property taxes, utilities costs, reimbursable manpower costs, repair and maintenance, insurance premium,
asset enhancement initiatives as well as management expenses, are deducted from the annual rental income and thereafter, the net annual rental income is
capitalised at an appropriate current market yield to arrive at its fair value.
Term rental - the expected rental that the investment properties are expected to achieve and is derived from the current passing
rental, including revision upon renewal of tenancies during the year;
Reversionary rental - the expected rental that the investment properties are expected to achieve upon expiry of term rental;
Other income - including percentage rent, car park income, advertising income and others;
Outgoings - including quit rent and assessment, utilities costs, reimbursable manpower costs, repair and maintenance,
insurance premium, asset enhancement initiatives as well as management expenses and other general expenses;
Capitalisation rate - based on actual location, size and condition of the investment properties and taking into account market data at the
valuation date;
Allowance for void - refers to allowance provided for vacancy periods, marketing and rent free periods.
Investment property with net book value RM691,813,000 (31.12.2013: RM715,478,000, 1.2.2013: RM738,339,000) have been charged as security for
borrowings as disclosed in Note 36.
Included in the Group’s investment properties incurred during the financial year/period were interest expense capitalised amounting to RM1,430,000 (31.12.2013:
RM4,273,000, 1.2.2013: Nil).
Group
31.12.2014 31.12.2013
RM’000 RM’000
At cost
Accumulated amortisation
Net book value of long term prepaid lease at 1 February 2013 amounted to RM3,703,000.
18 INTANGIBLE ASSETS
Development
Group costs License Goodwill Total
RM’000 RM’000 RM’000 RM’000
31.12.2014
Cost
Accumulated amortisation
At 31 December 2014 - - - -
Development
Group costs License Goodwill Total
RM’000 RM’000 RM’000 RM’000
31.12.2013
Cost
Accumulated amortisation
19 BIOLOGICAL ASSETS
Group
31.12.2014 31.12.2013
RM’000 RM’000
Broodstocks
Cost
Accumulated amortisation
Net book value of Broodstock biological assets as at 1 February 2013 amounted to RM647,000.
20 SUBSIDIARIES
Company
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
- - -
The market value of the quoted ordinary shares is at RM2,544,854,268 (31.12.2013: RM1,113,136,380).
20 SUBSIDIARIES (CONTINUED)
Company
31.12.2014 31.12.2013
RM’000 RM’000
The investment in Ecosem Sdn Bhd that was previously impaired has been written off during the year as the subsidiary has been liquidated.
31.12.2014 31.12.2013
Effective Effective
Country of interest held interest held
incorporation Effective by non- Effective by non-
and place interest held controlling interest held controlling
Name of business Nature of business by the group interest by the group interest
% % % %
GTower Sdn Bhd Malaysia Property investment holding 80.00 20.00 80.00 20.00
G Fish (Asia) Sdn Bhd Malaysia Aquaculture operation 96.67 3.33 96.67 3.33
IGB Corporation Berhad Malaysia Investment holding 73.32 26.68 31.63 68.37
and property development
Lautan Bumimas Sdn Bhd Malaysia Aquaculture operation 51.00 49.00 51.00 49.00
20 SUBSIDIARIES (CONTINUED)
31.12.2014 31.12.2013
Effective Effective
Country of interest held interest held
incorporation Effective by non- Effective by non-
and place interest held controlling interest held controlling
Name of business Nature of business by the group interest by the group interest
% % % %
*Crest Spring (Shanghai) The People's Provision of engineering services 100.00 - 100.00 -
Co. Ltd. Republic of for pure water and waste
China water treatment plants and
related services
*New Water Co. Ltd. The People's Management, operations and 100.00 - 100.00 -
Republic of maintenance of waste water
China treatment plant for a concession
period of 24 years
*Jiang Su Crest Spring The People's Investment holding and consultancy 99.50 0.50 99.50 0.50
Co. Ltd. Republic of services in water treatment
China
*Yantai Xin Cheng The People's Management, operations and 100.00 - 100.00 -
Wastewater Treatment Republic of maintenance of waste water
Co. Ltd China treatment plant for a concession
period of 23 years
20 SUBSIDIARIES (CONTINUED)
31.12.2014 31.12.2013
Effective Effective
Country of interest held interest held
incorporation Effective by non- Effective by non-
and place interest held controlling interest held controlling
Name of business Nature of business by the group interest by the group interest
% % % %
OM3 Fish (Asia) Sdn Bhd Malaysia Marketing and sale of aquaculture 96.67 3.33 96.67 3.33
products
OM3 Fish Development Malaysia Aquaculture farms development 96.67 3.33 96.67 3.33
Sdn Bhd and construction
OM3 Fish Services Malaysia Aquaculture operations and provision 96.67 3.33 96.67 3.33
Sdn Bhd of management services
MVC Fiberlynx Sdn Bhd Malaysia Provision of broadband internet 100.00 - 100.00 -
access services, web enabling
services, supply and service of
computer and related products
Mines Fiberlynx Sdn Bhd Malaysia Provision of broadband internet 100.00 - 100.00 -
access services, web enabling
services, supply and service of
computer and related products
Sonata Vision Sdn Bhd Malaysia Food and beverage operations 100.00 - 100.00 -
Abad Flora Sdn. Bhd 1 Malaysia Property investment 73.32 26.68 31.63 68.37
Amandamai Dua
Sdn. Bhd. 1 Malaysia Property development 73.32 26.68 31.63 68.37
Amandamai Satu
Sdn. Bhd. 1 Malaysia Property development 73.32 26.68 31.63 68.37
Angkasa Gagah
Sdn. Bhd. 1 Malaysia Property development 73.32 26.68 31.63 68.37
20 SUBSIDIARIES (CONTINUED)
31.12.2014 31.12.2013
Effective Effective
Country of interest held interest held
incorporation Effective by non- Effective by non-
and place interest held controlling interest held controlling
Name of business Nature of business by the group interest by the group interest
% % % %
Arabayu Sepakat
Sdn. Bhd. 1 Malaysia Property development 73.32 26.68 31.63 68.37
and property investment
*Asian Equity Limited 2 British Virgin Investment holding 40.33 59.67 17.40 82.60
Islands
Atar Deras Sdn. Bhd. 1 Malaysia Property development 73.32 26.68 31.63 68.37
*Auspicious Prospects
Ltd. 3 Liberia Investment holding 73.32 26.68 31.63 68.37
Belimbing Hills Sdn. Malaysia Property development 73.32 26.68 31.63 68.37
Bhd. 1
*Beswell Limited 4 Hong Kong Investment holding 73.32 26.68 31.63 68.37
Cipta Klasik (M) Malaysia Property development 51.32 48.68 31.63 68.37
Sdn. Bhd. 1
Cititel Hotel Management Malaysia Hotel management services 43.99 56.01 18.98 81.02
Sdn. Bhd.
*Cititel Hotels Pty Ltd 4 Australia Investment holding 73.32 26.68 31.63 68.37
Danau Bidara (M) Malaysia Property investment 73.32 26.68 31.63 68.37
Sdn. Bhd. 1
Detik Harapan Sdn. Bhd. Malaysia Educational institution 43.99 56.01 18.98 81.02
Dian Rezki Sdn. Bhd. Malaysia Dormant 73.32 26.68 31.63 68.37
(under members’
voluntary liquidation)
Distinctive Ace Sdn. Bhd. 5 Malaysia Property investment 36.66 + 63.64 15.82 84.18
and property development 1 share
Earning Edge Sdn. Bhd. 6 Malaysia Investment holding 47.66 52.34 20.56 79.44
20 SUBSIDIARIES (CONTINUED)
31.12.2014 31.12.2013
Effective Effective
Country of interest held interest held
incorporation Effective by non- Effective by non-
and place interest held controlling interest held controlling
Name of business Nature of business by the group interest by the group interest
% % % %
Eastwind Alliance Sdn. Malaysia Investment holding 73.32 26.68 31.63 68.37
Bhd. 1
Harta Villa Sdn. Bhd. 1 Malaysia Property development 73.32 26.68 31.63 68.37
ICDC Holdings Sdn. Bhd. Malaysia Investment holding 73.32 26.68 31.63 68.37
Idaman Spektra Sdn. Bhd. Malaysia Property investment 73.32 26.68 31.63 68.37
IGB International School Malaysia Property investment 73.32 26.68 31.63 68.37
Sdn. Bhd.
IGB International Ventures Malaysia Investment holding 73.32 26.68 31.63 68.37
Sdn. Bhd.
IGB Project Management Malaysia Project management services 73.32 26.68 31.63 68.37
Services Sdn. Bhd.
IGB Properties Sdn. Bhd. Malaysia Property investment 73.32 26.68 31.63 68.37
and management
IGB REIT Management Malaysia Management of real estate 73.32 26.68 31.63 68.37
Sdn. Bhd. investment trust
IGB Real Estate Malaysia Real estate investment trust 37.91 62.09 16.13 83.87
Investment Trust
Innovation & Concept Malaysia Property development 73.32 26.68 31.63 68.37
Development Co.
Sdn. Bhd. 7
IST Buillding Products Malaysia Trading of building 73.32 26.68 31.63 68.37
Sdn. Bhd. materials
20 SUBSIDIARIES (CONTINUED)
31.12.2014 31.12.2013
Effective Effective
Country of interest held interest held
incorporation Effective by non- Effective by non-
and place interest held controlling interest held controlling
Name of business Nature of business by the group interest by the group interest
% % % %
IT&T Engineering & Malaysia Investment holding 73.32 26.68 31.63 68.37
Construction Sdn. Bhd.
Kenny Vale Sdn. Bhd. 1 Malaysia Property development 73.32 26.68 31.63 68.37
Kondoservis Sdn. Bhd. 1 Malaysia Management services 73.32 26.68 31.63 68.37
*Lingame Company Hong Kong Investment holding 73.32 26.68 31.63 68.37
Limited
Megan Prestasi Sdn. Bhd. Malaysia Investment holding 73.32 26.68 31.63 68.37
Mid Valley City Sdn. Bhd. Malaysia Management services/ 73.32 26.68 31.63 68.37
service provider
Mid Valley City Malaysia Property development 73.32 26.68 31.63 68.37
Developments Sdn. Bhd.
Mid Valley City Malaysia Selling and distribution of utilities 73.32 26.68 31.63 68.37
Energy Sdn. Bhd.
Mid Valley City Gardens Malaysia Management services/ 73.32 26.68 31.63 68.37
Sdn. Bhd. service provider
20 SUBSIDIARIES (CONTINUED)
31.12.2014 31.12.2013
Effective Effective
Country of interest held interest held
incorporation Effective by non- Effective by non-
and place interest held controlling interest held controlling
Name of business Nature of business by the group interest by the group interest
% % % %
Mid Valley City Malaysia Property investment 73.32 26.68 31.63 68.37
North Tower Sdn. Bhd.
Mid Valley City Malaysia Building and maintenance services 73.32 26.68 31.63 68.37
Property Services
Sdn. Bhd. 11
Mid Valley City Malaysia Property investment 73.32 26.68 31.63 68.37
South Tower Sdn. Bhd.
Mid Valley City Malaysia Property investment 73.32 26.68 31.63 68.37
Southpoint Sdn. Bhd.
Murni Properties Sdn. Bhd. Malaysia Property investment 73.32 26.68 31.63 68.37
MVC Centrepoint North Malaysia Property investment 73.32 26.68 31.63 68.37
Sdn. Bhd.
MVC Centrepoint South Malaysia Property investment 73.32 26.68 31.63 68.37
Sdn. Bhd.
MVC CyberManager Malaysia Operation of MSC cyber centre 73.32 26.68 31.63 68.37
Sdn. Bhd. in Mid Valley City
MVEC Exhibition and Malaysia Exhibition services 73.32 26.68 31.63 68.37
Event Services Sdn. Bhd.
Nova Persona Sdn. Bhd. 1 Malaysia Property development 73.32 26.68 31.63 68.37
OPT Ventures Sdn. Bhd. 1 Malaysia Property development 51.32 48.68 22.14 77.86
and property investment
Pacific Land Sdn. Bhd. Malaysia Investment holding 73.32 26.68 31.63 68.37
*Pacific Land Pte Ltd 4 Singapore Investment holding 73.32 26.68 31.63 68.37
20 SUBSIDIARIES (CONTINUED)
31.12.2014 31.12.2013
Effective Effective
Country of interest held interest held
incorporation Effective by non- Effective by non-
and place interest held controlling interest held controlling
Name of business Nature of business by the group interest by the group interest
% % % %
Plaza Permata Malaysia Property management services 73.32 26.68 31.63 68.37
Management Services
Sdn. Bhd
Puncak Megah (M) Malaysia Investment holding 73.32 26.68 31.63 68.37
Sdn. Bhd.
Rapid Alpha Sdn. Bhd. Malaysia Hotelier 73.32 26.68 31.63 68.37
Reka Handal Sdn. Bhd. 1 Malaysia Property development 54.99 45.01 23.72 76.28
*St Giles Hotels (Asia) Labuan Hotel management services 43.99 56.01 18.98 81.02
Limited 12
Tan & Tan Developments Malaysia Property development, project 73.32 26.68 31.63 68.37
Berhad management services and
investment holding
Tan & Tan Realty Malaysia Property investment and 58.66 41.34 25.30 74.70
Sdn. Bhd. 1 food court operator
The Gardens Theatre Malaysia Lease auditorium space 73.32 26.68 31.63 68.37
Sdn. Bhd. for performing arts
Verokey Sdn. Bhd. Malaysia Property investment 73.32 26.68 31.63 68.37
20 SUBSIDIARIES (CONTINUED)
31.12.2014 31.12.2013
Effective Effective
Country of interest held interest held
incorporation Effective by non- Effective by non-
and place interest held controlling interest held controlling
Name of business Nature of business by the group interest by the group interest
% % % %
*Wilmer Link Limited 13 British Virgin Investment holding 42.53 57.47 18.35 81.65
Islands
X-Speed Sdn. Bhd. Malaysia Property investment 73.32 26.68 31.63 68.37
Notes:
1- Held by Tan & Tan Developments Berhad
2- Held by Pacific Land Sdn. Bhd., and TTD Sdn. Bhd., 35.0% and 20.0% respectively.
3- Held by Lingame Company Limited.
4- Held by Pacific Land Sdn. Bhd.
5- Held by Megan Prestasi Sdn. Bhd.
6- Held by Pacific Land Sdn. Bhd., and TTD Sdn. Bhd., 45.0% and 20.0% respectively.
7- Held by ICDC Holdings Sdn. Bhd.
8- Held by IGB Project Management Services Sdn. Bhd.
9- Held by Earning Edge Sdn.Bhd.
10 - Held by KrisAssets Holdings Berhad
11 - Held by Mid Valley City Developments Sdn. Bhd
12 - Held by Cititel Hotel Management Sdn Bhd
13 - Held by IGB International Ventures Sdn Bhd
All subsidiary undertakings are included in the consolidation. The proportion of the voting rights in the subsidiary undertakings held directly by the parent
company do not differ from the proportion of ordinary shares held.
As at 31.12.2014, the total non-controlling interest is RM1,251,220,000 (31.12.2013: RM2,936,793,000 1.2.2013: RM3,513,012,000), of which
RM1,228,015,000 (31.12.2013: RM2,914,802,000, 1.2.2013: RM3,472,723,000) is for IGB Group. The non-controlling interest in respect of other subsidiaries
of RM23,205,000 (31.12.2013: RM21,991,000, 1.2.2013: RM40,289,000) is not material.
Set out below are the summarised financial information of IGB Group, the material non-controlling interest to the group.
20 SUBSIDIARIES (CONTINUED)
IGB Group
Restated Restated
31.12.2014 31.12.2013 31.1.2013
RM’000 RM’000 RM’000
Current
Non-current
20 SUBSIDIARIES (CONTINUED)
IGB Group
Restated
11 months
Year ended period ended
31.12.2014 31.12.2013
RM’000 RM’000
Cash and cash equivalents at end of the financial year/period 593,572 948,117
Group
Restated Restated
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
At cost
Unquoted shares in Malaysia 88,808 92,750 80,450
Unquoted shares outside Malaysia 25,977 25,977 26,118
Amounts owing by associates 41,614 - -
The amounts due from associates of which the Group does not expect repayment in the foreseeable future are considered as part of the Group’s investment in
the associates.
Group
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
At cost
Unquoted shares outside Malaysia 65,649 - -
Amounts owing by joint ventures 310,770 - -
376,419 - -
Group’s share of post- acquisition results and reserves (3,312) - -
Set out below are associates and joint ventures of the Group, which, in the opinion of the Directors, are material to the Group. The associates and joint ventures
as listed below have share capital consisting solely of ordinary shares, which are held directly by the Group. In the opinion of the Directors, all the other associates
are immaterial to the Group.
Group’s effective
Principal Place of Nature of interest (%)
Name of company Activities incorporation relationship 31.12.2014 31.12.2013
Ravencroft Investments Incorporated Investment Holding British Virgin Islands Associate 36.29 15.66
Crystal Property Asia Company Ltd. Property Development Thailand Joint Venture 35.93 -
and Construction
Revenue 47,230 - -
Administrative expense (24,687) (6,526) (117)
Interest income 3,261 - -
Other operating income - 15 -
Interest expense (7,363) - -
Financial liabilities (excluding trade and other payables and provision) (1,141) - -
Other current liabilities (including trade and other payables and provision) (214,302) (633,696) -
Financial liabilities (excluding trade and other payables and provision) (88,281) - -
Reconciliation of the summarised financial information presented to the carrying amount of its interest in associates and joint ventures is set out below:
Carrying amount of interest in associate and joint ventures 144,612 307,541 65,564
Set out below are the financial information of all individually immaterial associates on an aggregate basis:
Group
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
G City Club Hotel Sdn Bhd 3 Malaysia Hotel operation 49.00 49.00
Hampshire Properties Sdn Bhd 1 Malaysia Property development and 36.66 15.82
property investment
*HICOM Tan & Tan Sdn. Bhd. 1 Malaysia Property development 36.66 15.82
Kumpulan Sieramas (M) Sdn. Bhd. 1 Malaysia Property development 36.66 15.82
*Merchant Firm Limited 5 British Virgin Islands Investment holding 36.29 15.66
*New Commercial Investments Limited 6 British Virgin Islands Investment holding 36.37 15.69
Permata Alasan (M) Sdn. Bhd. 1 Malaysia Property development 36.66 15.82
property investment
*Ravencroft Investments Incorporated 8 British Virgin Islands Investment holding 36.29 15.66
*St Giles Hotel 4 Republic of Congo Construction and hotel management 36.29 -
*St Giles Hotel, Inc 10 United States of America Hotelier 36.29 15.66
*St Giles Hotel LLC 11 United States of America Hotelier 36.29 15.66
*St Giles Hotel (Heathrow) Limited 6 United Kingdom Hotelier 36.37 15.69
*Technoltic Engineering Sdn Bhd Malaysia Servicing, maintenance and 29.33 12.65
installation of elevators
Notes:
1- Held by Tan & Tan Developments Berhad
2- Held by Tan & Tan Developments Berhad and IGB Corporation Berhad 25.63% and 12.82% respectively.
3- Held by Triple Hallmark Sdn Bhd
4- Held by Merchant Firm Limited
5- Held by Ravencroft Investments Incorporated
6- Held by Pacific Land Sdn. Bhd., and TTD Sdn. Bhd., 31.53% and 18.02% respectively
7- Held by Pacific Land Sdn. Bhd.
8- Held by Pacific Land Sdn. Bhd., Beswell Limited and TTD Sdn. Bhd., 27.72%, 7.65% and 14.10% respectively.
9- Held by Kumpulan Sierramas (M) Sdn. Bhd.
10- Held by St Giles Hotel Limited
11- Held by St Giles Hotel, Inc
Notes:
1- Held by Black Pearl Limited
2- Held by Verokey Sdn Bhd
3- Held by Majestic Path Sdn Bhd
Group Company
31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Non-current
Current
Group Company
31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
23 CONCESSION RECEIVABLES
Group
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
The Group has entered into service concession arrangements with the government of the People’s Republic of China to construct and operate waste water
treatment plants for a period ranging from 23 to 25 years. The terms of arrangement allows the Group to maintain and manage these treatment plants and
receive consideration based on usage and rates as determined by the grantor for the entire duration of the concession subject to a minimum water volume
calculated based on the waste water treatment plants normal capacity.
The additional concession receivable recognised during the year relates to a new 25 years service concession agreement secured in 2013 for which the
construction of the plant commenced in 2014.
The Group recognises the consideration received or receivable as a financial asset to the extent that it has an unconditional right to receive cash or another
financial asset for the construction and operating services.
Group
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
The fair values are based on cash flows discounted based on the discount rate of 4.62% (31.12.2013: 4.5%). The fair values are within level 2 of the fair value
hierarchy.
24 DEFERRED TAX
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when the
deferred taxes relate to the same tax authority.
The following amounts, determined after appropriate offsetting, are shown in the statements of financial position:
Group Company
Restated Restated
31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Deferred tax liabilities (net) (190,928) (197,129) (186,297) (67) (59) (75)
The movements in deferred tax assets and liabilities of the Group and Company during the financial year/period are as follows:
Group Company
Restated
31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
Group Company
Restated Restated
31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Deferred tax liabilities (after offsetting) (191,031) (197,232) (192,190) (67) (59) (75)
The amounts of deductible temporary differences and unused tax losses (all of which have no expiry) for which no deferred tax asset is recognised in the
statements of financial position are as follows:
Group
Restated Restated
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
Deferred tax assets not recognised at 24% (31.12.2013: 25%; 1.2.2013: 25%) 34,323 23,974 22,205
Group Company
31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Changes in fair values of financial assets at fair value through profit or loss are recorded in ‘other income’ in the income statements. The fair value of equity
securities is based on their current quoted prices in an active market.
Group
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
The amounts owing by associates and joint ventures represent advances which are unsecured and are repayable on demand. The amounts owing by associates
and joint ventures are interest free (31.12.2013: interest free) except for an amount of RM21,079,000 (31.12.2013: RM19,439,000), which carries interest at
a rate of 15.0% (31.12.2013: 15.0%) per annum. The amounts owing to associates are interest free (31.12.2013: interest free).
Credit term of receivables from associate which are trade in nature are 30 days (31.12.2013: 30 days).
Credit term of amounts owing to associate which are trade in nature are interest free (31.12.2013: interest free).
Company
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
Group Company
Restated Restated
31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
The carrying amounts of trade and other receivables as at 31 December 2014, 31 December 2013 and 1 February 2013 approximated their fair values.
Credit terms of trade receivables ranged from 7 to 90 days (31.12.2013: 7 to 90 days, 1.2.2013: 7 to 90 days).
The remaining contractual billings to customers from its property development activities amounted to RM152 million and will be billed progressively upon the
fulfilment of contractual milestones not withstanding if control of the assets has not been transferred to the customers. The contractual billings period for property
development ranges between 3 to 4 years.
As at 31 December 2014, trade receivables for the Group of RM52,423,000 (31.12.2013: RM65,700,000, 1.2.2013: RM78,938,000) were past due but not
impaired. These relate to a number of customers for whom there is no recent history of default, have met the Group’s credit approval policies and are monitored
on an on-going basis. The ageing of these trade receivables is as follows:
Group
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
As at 31 December 2014, trade and other receivables of RM8,680,000 (31.12.2013: RM13,418,000, 1.2.2013: RM14,314,000) were impaired and provided
for. The individually impaired receivables mainly relate to customers which are in unexpectedly difficult economic situations. The ageing of these receivables
was as follows:
Group
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
Up to 6 months - - 134
Above 6 months 8,680 13,418 14,180
Movement on the Group’s provision for impairment of trade and other receivables were as follows:
Group
31.12.2014 31.12.2013
RM’000 RM’000
The creation and reversal of provision for impairment have been included in the income statements. Amounts charged to the provision account are generally
written off, when there is no expectation of recovery additional cash. The other classes within trade and other receivables do not contain impaired assets.
The maximum exposure to credit risk as at 31 December 2014, 31 December 2013 and 1 February 2013 is the carrying value of each class of receivables
mentioned above.
The contract assets and contract liabilities as at 31 December 2014, 31 December 2013 and 1 February 2013 were not impacted by significant changes in
contract terms.
Group
Restated
11 months
Year ended period ended
31.12.2014 31.12.2013
RM’000 RM’000
Property development and construction revenue recognised during the financial year/period 185,422 140,168
Less: Provision of liquidated and ascertained damages during the financial year/period (2,541) -
182,881 140,168
Less: Billings during the year/period (122,300) (125,376)
At 31 December
- contract asset 112,538 50,694
- contract liability (1,263) -
111,275 50,694
There were no revenue recognised in the reporting period for the Group that was included in the contract liability for property development and construction as
at 1 January 2014 and 1 February 2013.
Cash and cash equivalent included in the statement of cash flows comprise of the following:
Group Company
Restated Restated
31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Current
Deposits with licensed banks 1,047,301 908,126 1,922,431 60,895 70,411 32,010
Cash and bank balances 166,985 244,044 252,539 11,488 18,172 11,373
Deposits, cash and bank balances 1,214,286 1,152,170 2,174,970 72,383 88,583 43,383
Cash held under Housing Development
Accounts (Note 28(a)) 40,500 32,984 5,259 - - -
Less: Restricted Cash (Note 28(b)) (509,806) (123,726) (122,731) (300) (300) (300)
Cash and cash equivalents 744,980 1,061,428 2,057,498 72,083 88,283 43,083
Bank balances held under the Housing Development Accounts represent receipts from purchasers of residential properties less payments or withdrawals
provided under Section 7A of the Housing Development (Control and Licensing) Amendment Act, 2002 held at call with banks and are denominated in
Ringgit Malaysia.
The weighted average effective interest rates of bank balances under Housing Development Accounts during the financial year were 2% (31.12.2013: 2%,
1.2.2013: 2%) per annum.
Deposits pledged have been placed with licensed banks as securities for certain secured interest bearing bank borrowings of the Group and of the Company
(Note 36), and are not available for use by the Group and the Company.
Included in deposits placed with licensed banks is an amount of RM28,097,000 (31.12.2013: RM27,436,000, 1.2.2013: RM26,441,000), which is
maintained as a Debt Service Reserve Account with a facility agent to cover a minimum of 6 months interest for a Syndicated Financing Facility granted to
a subsidiary, IGB Real Estate Investment Trust (Note 36).
Fixed deposits with licensed banks of the Group and the Company have an average maturity period of 49 days (31.12.2013: 34 days, 1.2.2013: 14 days)
and 6 days (31.12.2013: 39 days, 1.2.2013: 13 days) respectively. Bank balances are deposits held at call with licensed banks and earn no interest.
The weighted average effective interest rates of deposits with licensed banks as at 31 December were as follows:
Group Company
31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
% % % % % %
29 SHARE CAPITAL
Authorised
Ordinary shares of RM1.00 each:
At the beginning of the financial year/period 1,000,000 1,000,000
Created during the financial year/period 500,000 -
During the financial year, the Company increased its authorised share capital from RM1,000,000,000 comprising of 1,000,000,000 ordinary shares of RM1.00
each to RM1,510,000,000 comprising of 1,500,000,000 ordinary shares of RM1.00 each and 1,000,000,000 Redeemable Convertible Cumulative Preference
Shares (“RCPS”) of RM0.01 each by creation of an additional 500,000,000 ordinary shares of RM1.00 each and 1,000,000,000 RCPS of RM0.01 each.
The new ordinary shares rank pari passu in all respects with the existing ordinary shares of the Company.
(i) The RCPS shall be convertible to new ordinary shares of Goldis at a fixed conversion price of RM2.28, at the option of the holder, at any time up to and
including the maturity date of 5 years from the date of listing of RCPS;
(ii) The Company has an option to redeem the RCPS from the third anniversary of the issue date of the RCPS up to the day immediately preceding the maturity
date and any RCPS not redeemed or converted shall be automatically converted into new ordinary shares of Goldis;
(iii) The holders of the RCPS shall have the right to receive a semi-annual preferential dividend at the rate of 4%, 4.5% and 5% from year 1 to 3, 4 and 5
respectively. Where there is no distributable profit, the entitlement to the preferential dividend shall be accumulated.
(iv) The RCPS will carry no right to vote at any general meeting of the Company except with regards to the following:
(a) when the dividend or part of the dividend on the RCPS is in arrears for more than six (6) months;
(b) on a proposal to reduce the Company’s share capital;
(c) on a proposal for the disposal of the whole of the Company’s property, business and undertaking;
(d) on a proposal that affects rights attached to the RCPS;
(e) on a proposal to wind up the Company; and
(f) during the winding-up of the Company.
(v) The RCPS shall rank pari passu among themselves, and will rank ahead in regards to payment of dividends in all classes of shares of the Company.
(vi) The RCPS shall rank in priority to the Goldis Shares in any distribution of assets in the event of liquidation, dissolution or winding-up of Goldis.
30 SHARE PREMIUM
31 TREASURY SHARES
In the current financial year, shareholders of the Company, by an ordinary resolution passed at the Annual General Meeting on 29 May 2014, approved the
Company’s plan to purchase its own shares up to a maximum of 10% of the issued and paid up capital of the Company. The Directors of the Company are
committed to enhancing the value of the Company to its shareholders and believe that the repurchase plan can be applied in the best interest of the Company
and its shareholders.
During the financial year, the Company has distributed tax exempt share dividend on the basis of three (3) treasury shares for every one hundred (100) existing
shares of RM1.00 each on 27 March 2014.
As at 31 December 2014, a total of 2,858,020 (31.12.2013: 20,553,953) ordinary shares of RM1.00 each were held as treasury shares.
31.12.2014 Number of Total consideration Purchase price per share (RM) Average cost
shares paid/cost Lowest Highest per share
(RM) (RM)
During the financial period ended 31 December 2013, the Company repurchased 24,000,500 of its issued share capital from the open market for RM47,894,271.
The average price paid for the shares repurchased was approximately RM2.00 per share.
The Company also sold 10,092,400 of its repurchased ordinary shares to the open market at an average price of RM2.00 per share. The total consideration
received for the resale including transaction costs was RM20,119,352.
31.12.2013 Number of Total consideration Purchase price per share (RM) Average cost
shares paid/cost Lowest Highest per share
(RM) (RM)
The repurchase transactions were financed by internally generated funds. The shares repurchased are being held as treasury shares in accordance with Section
67A of the Companies Act, 1965 and carried at purchase cost. The Company has the right to distribute these shares as dividends to reward shareholders and/
or resell the shares. As treasury shares, the rights attached as to voting, dividends and participation in others distribution are suspended.
As at 31 December 2014, the number of outstanding ordinary shares in issue after the setting off treasury shares against equity was 607,636,036 (31.12.2013:
589,940,103) ordinary shares of RM1.00 each.
32 OTHER RESERVES
Group
31.12.2014
31.12.2013 (Restated)
At 1 February 2013
- as previously reported 124,719 55,535 18,863 (12,231) 186,886
- effects of transitioning to MFRS (124,719) - - 12,231 (112,488)
Company
Available
for-sale
reserve
RM’000
31.12.2014
31.12.2013
33 RETAINED EARNINGS
Under the single-tier tax system which came into effect from the year of assessment 2008, companies are not required to have tax credits under Section 108
of the Income Tax Act, 1967 for dividend payment purposes. Dividends paid under this system are tax exempt in the hands of the shareholders.
Group Company
Restated Restated
31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Non-current
(A) Trade and other payables
Deposits received 70,169 73,405 64,723 - - -
Current
(A) Trade and other payables
Trade payables 142,545 114,740 79,507 - - -
Other payables 86,832 83,343 74,532 118 14 2
Accruals 172,913 198,236 153,666 4,512 445 487
Deposits received 113,206 94,760 75,864 - - -
Deferred revenue 5,881 4,905 5,423 - - -
Credit terms of trade payables ranged from 30 to 90 days (31.12.2013: 30 to 90 days, 1.2.2013: 30 to 90 days).
Included in trade and other payables of the Group is retention sum of RM52,422,000 (31.12.2013: RM36,267,000, 1.2.2013: RM23,938,818).
The fair value of the non-current portion of deposits received from tenants at the reporting date approximates their carrying amount as the impact of discounting
is not significant.
Group
31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000
Minimum payments:
- Payable within 1 year 79 89 81
- Payable between 1 and 5 years 133 212 156
Non-current
- Payable between 1 and 5 years 124 194 144
Finance lease liabilities are effectively secured as the rights to the leased assets revert to the lessors in the event of default.
The interest rates for the financial year ranged from 2.42% to 3.70% (31.12.2013: 2.42% to 3.70%, 1.2.2013: 3.10% to 3.75%) per annum. As at 31
December 2014, the effective interest rate applicable to the hire-purchase and finance lease payables was 5.67% (31.12.2013: 5.76%, 1.2.2013: 6.51%) per
annum.
Group Company
Note 31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Non-current
Secured:
- Term loans (b) 1,571,267 1,484,909 1,526,581 - - -
Current
Secured:
- Revolving credits (a) 2,096,395 206,910 346,294 1,545,120 - -
- Term loans (b) 110,987 56,378 16,557 - - -
Unsecured:
- Revolving credits (a) 110,521 - - - - -
Total
- Revolving credits (a) 2,206,916 206,910 346,294 1,545,120 - -
- Term loans (b) 1,682,254 1,541,287 1,543,138 - - -
The weighted average effective interest rates per annum at the end of reporting date of the Group for the above borrowings are as follows:
Group Company
31.12.2014 31.12.2013 1.2.2013 31.12.2014 31.12.2013 1.2.2013
% % % % % %
The carrying amounts and fair values of the borrowings for the Group are as follows:
The carrying amounts and fair values of the borrowings for the Company are as follows:
The fair value of current borrowings approximates their carrying amount as the impact of discounting is not significant.
The fair value of borrowings is estimated based on discounted cash flows using prevailing market rates for borrowings with similar risks profile and within level
3 of the fair value hierarchy.
Total
Maturity profile carrying
Group <1 year 1-2 year 2-5 years > 5 years amount
RM’000 RM’000 RM’000 RM’000 RM’000
At 31 December 2014
Revolving credits:
- Floating interest rate 2,116,916 - - - 2,116,916
- Fixed interest rate 90,000 - - - 90,000
Term loans:
- Floating interest rate 5,157 10,000 165,000 - 180,157
- Fixed interest rate 105,830 50,000 1,346,267 - 1,502,097
At 31 December 2013
Revolving credits:
- Floating interest rate 116,910 - - - 116,910
- Fixed interest rate 90,000 - - - 90,000
Term loans:
- Floating interest rate 40,196 - - - 40,196
- Fixed interest rate 16,182 90,000 1,394,909 - 1,501,091
Total
Maturity profile carrying
Group <1 year 1-2 year 2-5 years > 5 years amount
RM’000 RM’000 RM’000 RM’000 RM’000
At 1 February 2013
Revolving credits:
- Floating interest rate 256,294 - - - 256,294
- Fixed interest rate 90,000 - - - 90,000
Term loans:
- Floating interest rate - 41,168 2,032 - 43,200
- Fixed interest rate 16,557 - 1,383,381 100,000 1,499,938
Company
At 31 December 2014
Revolving credits:
- Floating interest rate 1,545,120 - - - 1,545,120
(i) A Revolving Credit (“RC”) of up to RM1,016,678,000 with a tenure of 1 year from the date of first drawdown; and
(ii) Banking facilities of up to RM528,442,000 comprising RC of up to RM280,000,000 and a Short Term Advance of up to RM248,442,000.
The banking facilities above have a tenure of 1 year from the date of first drawdown and bears a floating interest rate of aggregate effective cost of
funds and a margin of 1.00% per annum.
The above banking facilities are secured by way of a Memorandum of Deposit over shares in a subsidiary, including but not limited , in all cases, to
bonus shares, rights shares and other new shares or rights entitlements at a minimum coverage of at least 1.2 times
B. Other than the RC A above, the other RC's of the Group are secured by way of:
(i) Fixed charge on the freehold land of a subsidiary company together with a 30 storey commercial building constructed thereon (Note 16);
(ii) Deposit of master title of a piece of land classified under property development coasts (Note 15(b));
C. Revolving credit facility of the Company is secured by way of fixed deposits amounting to RM300,000 placed with a licensed bank (Note 28).
A. AmTrustee Berhad (“the Trustee”), on behalf of IGB Real Estate Investment Trust (“REIT”), as borrower, has obtained the Syndicated Financing Facilities
(“SFF”) comprising the following:
(a) A fixed rate term loan facility (“FRTL”) of up to RM1,200 million; and
(b) A standby revolving credit facility of (“SBRC”) of up to RM20 million.
The FRTL has a tenure of five (5) years from the date of first drawdown with an option to extend the same for a further two (2) years exercisable by
the Trustee. For the first five (5) years, the FRTL bears a fixed interest rate of 4.4% per annum. In the event the FRTL is extended, the interest rates
for the sixth and the seventh year shall be stepped up to 5.0% per annum.
The SBRC has tenure of seven (7) years from the date of fulfilment of all conditions precedent. The SBRC bears a floating interest rate of the aggregate
effective costs of funds and a margin of 0.7% per annum.
(i) a first party assignment by the Trustee of its rights, title, interests and benefits in Mid Valley Megamall and under the sale and purchase
agreement in relation to Mid Valley Megamall pursuant to the Acquisitions and all other documents evidencing the Trustee’s interest in Mid Valley
Megamall. In the event the subdivision of master title is completed and a separate strata title is issued for Mid Valley Megamall (“Megamall Strata
Title”), a first party first legal charge shall be created by the Trustee on the Megamall Strata Title for the benefit of the syndicated lenders;
(ii) an undertaking from the Trustee and IGB REIT Management Sdn Bhd (“the Manager”):
(a) to deposit all cash flows generated from Mid Valley Megamall into the revenue account; and
(b) that it shall not declare or make any dividends or distributions out of the cashflow derived from Mid Valley Megamall to the Unitholders if
an event of default has occurred under the terms of the SFF, and is continuing and has not been waived;
(iii) a first party legal assignment and charge by the Trustee over all rights, interests, title and benefits relating to the following designated accounts:
(a) the revenue account into which the Trustee shall credit, among others, all income and insurance proceeds derived from or in relation to Mid
Valley Megamall;
(b) the operating account which is to capture funds transferred from the revenue account for the purpose of managing the operating expenditure
of Mid Valley Megamall; and
(c) the debt service reserve account which is to capture funds transferred from the revenue account for purposes of meeting the debt service
requirement;
(iv) a first party legal assignment by the Trustee of all the proceeds under the tenancy/lease agreements in relation to Mid Valley Megamall.
B. During the financial year, this subsidiary company secured a new term loan ("TL") of RM180 million with a tenure of five (5) years and bears a floating
interest rate of the aggregate cost of funds and margin of 1.35% per annum.
(i) A first party charge over hotel properties of the subsidiary company (Note 14);
C. Term loan obtained by a subsidiary comprise a FRTL of RM200 million (31.12.2013: RM200 million, 1.2.2013: RM200 million) with a tenure of ten
(10) years from the date of first drawdown and bears a fixed interest rate of 5.85% (31.12.2013: 5.85%, 1.2.2013: 5.85%) per annum.
The FRTL is secured against the hotel property of a subsidiary (Note 14).
D. The previous TL of RM40 million (1.1.2013: RM40 million) of a subsidiary which had a tenure of five (5) years and was bearing a floating interest rate
of the aggregate effective cost of funds and a margin of 1.35% (1.1.2013: 1.35%) per annum was repaid during the year.
E. A term loan of RM90 million of a subsidiary company with a tenure of five (5) years from the date of first drawdown and bears a fixed interest rate of
5.3% (31.12.2013: 5.3%, 1.2.2013: 5.3%) per annum.
The loan secured against the freehold land of a subsidiary together with the 30 storey commercial building constructed thereon (Note 16).
Subsequent to financial year end, the subsidiary has renewed the terms of its RM90 million term loan. The term loan were renegotiated as follows:
(a) the entire amount of RM90 million is repayable in full on 25 February 2020 with an option to extend the facility for another 3 years, subject to
the lenders consent; and
The advances to subsidiaries are unsecured, repayable on demand and carry interest rates ranged from 4.00% (31.12.2013: 4.00% to 4.50%) per annum.
The advances from subsidiaries are unsecured, interest free and have no fixed terms of repayment.
Company
31.12.2014 31.12.2013
RM’000 RM’000
At 1 January/At 1 February - 29
Finance income credited to the income statement - (29)
At 31 December - -
The financial guarantee contract is the fair value of corporate guarantee given by the Company to its subsidiary on the interest bearing bank borrowings of a
subsidiary.
39 DIVIDENDS
On 3 July 2013, the Directors declared an interim dividend in respect of the financial period ended 21 December 2013 by way of distribution of tax-exempt share
dividend on the basis of three (3) treasury shares for every one hundred (100) existing oedinary shares of RM1.00 each on 18 July 2013. The share dividend
involved the distribution of 17,440,547 treasury shares which were credited into the entitled Depositors' Securities Accounts on 31 July 2013,
On 27 February 2014, the Directors declared an interim dividend in respect of the financial period ended 31 December 2013 by way of distribution of tax-
exempt share dividend on the basis of three (3) treasury shares for every one hundred (100) existing shares on 14 March 2014. The share dividend involved the
distribution of 17,695,933 treasury shares which were credited into the entitled Depositors’ Securities Accounts on 27 March 2014.
The Directors did not recommend the payment of any final dividend for the financial year ended 31 December 2014.
40 CAPITAL COMMITMENTS
Group
31.12.2014 31.12.2013
RM’000 RM’000
1,481,351 401,822
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Group, directly or
indirectly, including any director (whether executive or otherwise) of the Group.
Key management personnel of the Group and of the Company are the Executive Director and senior management of the Group and of the Company.
Group Company
11 months 11 months
Year ended period ended Year ended period ended
31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
Included in the key management compensation is Executive Director’s remuneration as disclosed in Note 10 to the financial statements.
In addition to related party disclosures mentioned elsewhere in the financial statements, set out below are other significant related party transactions and
balances. The related party transactions described below were carried out on terms and conditions agreed with the related parties.
Wasco Management A wholly-owned subsidiary of Wah Seong Corporation Berhad, a company in which Dato’ Seri Robert Tan Chung Meng,
Services Sdn. Bhd. Pauline Tan Suat Ming and Tony Tan @ Choon Keat, Directors of IGB, have substantial financial interest.
Cahaya Utara Sdn. Bhd. An associate of Wah Seong (Malaya) Trading Co. Sdn. Bhd., a company in which Dato’ Seri Robert Tan Chung Meng,
Pauline Tan Suat Ming and Tony Tan @ Choon Keat, Directors of IGB, have substantial financial interest.
Strass Media Sdn. Bhd. A subsidiary of Wah Seong (Malaya) Trading Co. Sdn. Bhd., a company in which Dato’ Seri Robert Tan Chung Meng,
Pauline Tan Suat Ming and Tony Tan @ Choon Keat, Directors of IGB, have substantial financial interest.
The significant related party transactions during the financial year/period are as follows:
Group
11 months
Year ended period ended
31.12.2014 31.12.2013
RM’000 RM’000
Company
11 months
Year ended period ended
31.12.2014 31.12.2013
RM’000 RM’000
Advances to subsidiaries:
- Advances 18,924 46,988
- Repayment 43,620 51,159
Free from management services receivable from GTower Sdn Bhd 1,464 242
Group
31.12.2014 31.12.2013
RM’000 RM’000
Company
31.12.2014 31.12.2013
RM’000 RM’000
Significant transactions with non-controlling interest during the financial years as follow:
During the financial year, the Group acquired an additional 41.69% (31.12.2013: 1.29%) equity interest in a subsidiary, IGB Corporation Berhad (“IGB”). As
a result, the Group have a 73.32% (31.12.2013: 31.63%) equity interest in IGB. The Group derecognised non-controlling interests of RM1,799,663,000
(31.12.2013: RM157,197,000) and recorded an increase/decrease in equity attributable to owners of the parent of RM154,567,000 (31.12.2013:
RM5,237,000). The effect of changes in the ownership interest of IGB on the equity attributable to owners of the parent during the year is summarised as
follows:
Group
31.12.2014 31.12.2013
RM’000 RM’000
On 30 September 2014, the Group disposed of a 30% interest out of the 100% interest held in Cipta Klasik (M) Sdn Bhd at a cash consideration of
RM41,244,000. This resulted in an increase in non-controlling interests of RM12,801,000 and no impact to the equity attributable to owners of the parent.
The effect of changes in the ownership interest of Cipta Klasik (M) Sdn Bhd on the equity attributable to owners of the parent during the year is summarised
as follows:
Group
31.12.2014
RM’000
On 18 July 2014, the Company had announced that it proposed to undertake a conditional take-over offer in accordance with the Malaysian Code on
Take-Overs and Mergers 2010 to acquire all the remaining ordinary shares of RM0.50 each in IGB which are not already owned by the Company (excluding
treasury shares), at an offer price of RM2.88 per Offer Share.
On 6 November 2014, subsequent the closure of the conditional take-over offer, the Company held in aggregate, 978,790,103 IGB shares, representing
approximately 73.32% of the issued and paid-up share capital of IGB (excluding treasury shares).
The acquisition of additional equity interest of 543,115,907 IGB shares was satisfied in full via cash of RM1,564,173,812.
On 23 December 2014, the proposed renounceable rights issue of up to 460.0 million new redeemable convertible cumulative preference shares with a par
value of RM0.01 each at an issue price of RM1.00 each (“RCPS”) was approved by the shareholders at the Extraordinary General Meeting of the Company.
The proceeds of the Rights Issue is to partially refinance the borrowings obtained in connection with the acquisition of an additional equity interest in IGB.
The entitlement basis of the RCPS is on 3 RCPS for every 4 existing ordinary shares of RM1.00 each in Goldis held on 20 January 2015.
On 12 February 2015, the Company had received valid and full subscription for a total of 455,727,027 RCPS at an issue price of RM1.00 each. The total
proceeds of the Right Issue amounted to RM455,727,027 is used to refinance the borrowings of the Company.
The RCPS was listed on the main Market of Bursa Malaysia Securities Berhad on 24 February 2015.
The effect of the Group’s and Company’s transition to MFRSs and MFRS 15 ‘Revenue from Contracts with Customers’, described in Note A, is summarised in
this Note as follows:
MFRS estimates as at transition date are consistent with the estimates as at the same date made in conformity with FRS.
MFRS 1 permits cumulative translation gains and losses to be reset to zero at the transition date. This provides relief from determining cumulative
currency translation differences in accordance with MFRS 121 ‘The effects of changes in foreign exchange rates’ from the date a foreign
operation was acquired. The Group elected to reset all cumulative translation differences to zero in opening retained earnings at its transition
date. At the transition date, cumulative translation differences set out in 44.4(a) has been transferred to retained earnings.
(b) Exemption for fair value as deemed cost - Property, Plant and Equipment (Hotel Properties)
In accordance with the exemptions in MFRS 1, the Group elected to measure certain land and buildings at fair value as at transition date as their
deemed cost as at that date.
In 2014, the Group early adopted MFRS 15, requiring the Group to review the measurement and timing of when revenue is recognised.
The new accounting policy had been adopted retrospectively and comparative amounts were restated.
The adoption of MFRS 15 on the Group’s and the Company’s recognition of revenue and costs of sales affected its property development activities, whereby;
i) It had deferred the recognition of revenue from sales of its properties where it was not able to determine the probability that it would be able to
collect the consideration to which it will be entitled and if the entity does not have an enforceable right to payment for performance completed
to date;
ii) It had identified separate performance obligations arising from its property development activities and have deferred revenue for performance
obligations that are only satisfied on delivery to its customers; and
iii) Expenses attributable to securing contracts with customers had been capitalised and expensed by reference to the progress towards complete
satisfaction of that performance obligation.
Certain comparatives have been restated due to transitioning to MFRS, adoption of MFRS 15 and reclassified to reflect the substance of the transition.
Effects of
transitioning
As previously to MFRS and Adoption of As
reported reclassification MFRS 15 restated
RM’000 RM’000 RM’000 RM’000
Profit for the financial period from continuing operations 309,893 - (5,114) 304,779
Profit for the financial period from discontinued operations 20,052 226 - 20,278
Attributable to:
Owners of the parent:
- continuing 81,934 - (1,545) 80,389
- discontinued 20,052 226 - 20,278
17.39 17.17
Effects of
transitioning
As previously to MFRS and Adoption of As
reported reclassification MFRS 15 restated
RM’000 RM’000 RM’000 RM’000
Total comprehensive income for the financial period 580,004 (240,829) (5,114) 334,061
Attributable to:
Owners of the parent 177,288 (76,179) (1,545) 99,564
Non-controlling interests 402,716 (164,650) (3,569) 234,497
Effects of
transitioning
As previously to MFRS and Adoption of As
reported reclassification MFRS 15 restated
RM’000 RM’000 RM’000 RM’000
As at 31.12.2013
ASSETS
NON-CURRENT ASSETS
CURRENT ASSETS
LIABILITIES
NON-CURRENT LIABILITIES
CURRENT LIABILITIES
Effects of
transitioning
As previously to MFRS and Adoption of As
reported reclassification MFRS 15 restated
RM’000 RM’000 RM’000 RM’000
As at 1.2.2013
ASSETS
NON-CURRENT ASSETS
CURRENT ASSETS
LIABILITIES
NON-CURRENT LIABILITIES
CURRENT LIABILITIES
MFRS 1 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the
reconciliations from FRSs to MFRSs for the respective periods noted for equity and total comprehensive income.
The transition from FRS to MFRS has had no effect on the reconciliation of equity and reconciliation of total comprehensive income of the Company and
on the reported cash flows generated by the Group and the Company.
The table below reconciles equity balances previously reported in accordance with FRS to equity balances restated in accordance with MFRS on
1 February 2013 (date of transition) and 31 December 2013:
1.2.2013 31.12.2013
RM’000 RM’000
Group
Retained earnings
Retained earnings as reported under FRS 694,729 881,846
Revaluation reserves
Fair value as deemed cost including changes arising from increase in equity interest
– hotel properties (124,719) (130,017)
Reversal of surplus on revaluation during 31 December 2013 - (75,374)
Effects of transitioning to MFRS (124,719) (205,391)
Non-controlling interest
Non-controlling interest as reported under FRS 3,510,460 3,102,460
Less: Transitioning adjustments:
Fair value as deemed cost - (164,650)
Add: Adjustments due to early adoption of MFRS 15 2,552 (1,017)
The table below reconciles the total comprehensive income previously reported in accordance with FRS to the total comprehensive income
restated in accordance with MFRS on 31 December 2013:
31.12.2013
RM’000
Group
Total comprehensive income
Total comprehensive income reported under FRS 580,004
Less: Transitioning adjustments:
Reversal of surplus on revaluation during 31 December 2013 (240,829)
Adjustments due to early adoption of MFRS 15 (5,114)
Company
Total comprehensive income
Total comprehensive income reported under FRS 62,476
Less: Transitioning adjustments:
Adjustments due to early adoption of MFRS 15 -
The financial statements have been approved for issue in accordance with a resolution of the Board of Directors dated 28 April 2015.
The following analysis is prepared in accordance with Guidance on Special Matter No.1, Determination of Realised and Unrealised Profits or Losses in the
context of disclosure pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants (“MIA Guidance”)
and the directive of Bursa Malaysia Securities Berhad.
Group Company
Restated
31.12.2014 31.12.2013 31.12.2014 31.12.2013
RM’000 RM’000 RM’000 RM’000
299,734 278,508 - -
We, Tan Lei Cheng and Tan Boon Lee, being two of the Directors of Goldis Berhad, state that, in the our opinion, the financial statements set out on pages 39 to 151
are drawn up so as to give a true and fair view of the state of affairs of the Group and the Company as at 31 December 2014 and of the results and cash flows of the
Group and the Company for the financial year ended on that date, in accordance with Malaysian Financial Reporting Standards, International Reporting Standards and
the requirements of the Companies Act, 1965 in Malaysia.
The information set out in Note 46 on page 152 has been prepared in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised
Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants.
Signed in accordance with a resolution of the Board of Directors dated 28 April 2015.
STATUTORY DECLARATION
Pursuant to Section 169(16) of the Companies Act, 1965
I, Leong Kok Chi, the officer primarily responsible for the financial management of Goldis Berhad, do solemnly and sincerely declare that the financial statements set
out on pages 39 to 152 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 Leong Kok Chi, at Kuala Lumpur, on 28 April 2015, before me.
Kuala Lumpur
We have audited the financial statements of Goldis Berhad on pages 39 to 151, which comprise the statements of financial position as at 31 December 2014 of
the Group and of the Company, and the statements of comprehensive income, statement of changes in equity and statement of cash flows of the Group and of the
Company for the year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on Notes 1 to 45.
The Directors of the Company are responsible for the preparation of financial statements so as to give a true and fair view in accordance with Malaysian Financial
Reporting Standards, International Financial Reporting Standards, and the requirements of the Companies Act, 1965 in Malaysia. The Directors are also responsible
for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether
due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on
auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether about
the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend
on our judgement, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk
assessments, we consider internal control relevant to the entity’s preparation of financial statements that give a true and fair view in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Directors, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements give a true and fair view of the financial position of the Group and of the Company as of 31 December 2014 and of their financial
performance and cash flows for the year then ended in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards, and the
requirements of the Companies Act, 1965 in Malaysia.
In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following:
(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiaries of which we have acted
as auditors have been properly kept in accordance with the provisions of the Act.
(b) We have considered the financial statements and the auditors’ reports of all the subsidiaries of which we have not acted as auditors, which are indicated in Note
20 to the financial statements.
(c) 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 financial statements of the Group and we have received satisfactory information and
explanations required by us for those purposes.
(d) The audit reports on the financial statements of the subsidiaries did not contain any qualification or any adverse comment made under Section 174(3) of the Act.
The supplementary information set out in Note 46 on page 152 is disclosed to meet the requirement of Bursa Malaysia Securities Berhad and is not part of the financial
statements. The directors are responsible for the preparation of the supplementary information in accordance with Guidance on Special Matter No. 1, Determination of
Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian
Institute of Accountants (“MIA Guidance”) and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is prepared, in all
material respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad.
OTHER MATTER
1. As stated in Note A on the basis of preparation of the financial statements, Goldis Berhad adopted Malaysian Financial Reporting Standards on 1 January 2014
with a transition date of 1 February 2013. These standards were applied retrospectively by Directors to the comparative information in these financial statements,
including the statements of financial position as at 31 December 2013 and 1 February 2013, and the income statements, statement of comprehensive income,
statement of changes in equity and statement of cash flows for the year ended 31 December 2013 and related disclosures. We were not engaged to report on
the restated comparative information and it is unaudited. Our responsibilities as part of our audit of the financial statements of the Group and of the Company
for the year ended 31 December 2014 have, in these circumstances, included obtaining sufficient appropriate audit evidence that the opening balances as at
1 January 2014 do not contain misstatements that materially affect the financial position as of 31 December 2014 and financial performance and cash flows
for the year then ended.
2. This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act, 1965 in Malaysia and for no other
purpose. We do not assume responsibility to any other person for the content of this report.
Kuala Lumpur
28 April 2015
Group Net
Book Value
Age of Date of As At
Building Description/ Acquisition/ 31 Dec 2014
Location/Address Tenure (Years) Existing use Revaluation RM’000
2 Mid Valley City, Lingkaran Leasehold 8 Shopping complex known 28-12-2004 544,321
Syed Putra, 59200 Kuala expiring 2103 as The Gardens Mall
Lumpur together with 4,128 car
parking bays
3 Mid Valley City, Lingkaran Leasehold 15 Shopping complex known 17-12-1999 403,267
Syed Putra, 59200 Kuala expiring 2103 as Mid Valley Megamall
Lumpur together with 6,102 car
parking bays
4 HS(D) 493555 PTD 208568 Leasehold - 31.5 acres vacant land for 03-09-2013 364,711
and HS(D) 493556 PTD expiring 2100 proposed mixed commercial
208569 Mukim Plentong development at Southkey,
Daerah Johor Bahru Johore
7 Mid Valley City, Lingkaran Leasehold 15 646-room Cititel Hotel 31-12-2011 272,511
Syed Putra, 59200 Kuala expiring 2103 Mid Valley
Lumpur
9 Micasa Hotel Apartments Freehold 25 242-key MiCasa All Suite 31-12-2010 176,074
368 Jalan Tun Razak Hotel
Kuala Lumpur
10 Lot 15256 Mukim of Labu, Freehold - 344.0 hectares vacant land 31-01-2002 172,336
District of Seremban, approved for mixed
Negeri Sembilan development for residential
and commercial use
SHARE CAPITAL
# Excluding 2,858,020 Shares bought-back by the Company and retained as treasury shares as at 31 March 2015
DISTRIBUTION OF SHAREHOLDINGS
SUBSTANTIAL SHAREHOLDERS
(excluding bare trustees)
Number of Shares Held
Name Direct %# Indirect* *%#
Dato’ Seri Robert Tan Chung Meng 1,483,509 0.24 178,355,976 29.35
Wah Seong (Malaya) Trading Co. Sdn Bhd 89,710,671 14.76 24,700,075 4.06
Note:
* Deemed interest pursuant to Section 6A of the Companies Act, 1965.
The Company
Dato’ Seri Robert Tan Chung Meng 1,483,509 0.24 178,355,976 29.35
Dato’ Seri Robert Tan Chung Meng 1,000,000 0.07 978,790,103 73.32
Dato’ Seri Robert Tan Chung Meng 7,289,081 0.21 1,818,563,225 52.66
Note:
* Deemed interest pursuant to Section 6A of the Companies Act, 1965.
Dato’ Seri Robert Tan Chung Meng 1,112,631 0.24 142,988,143 31.38
Note:
* Deemed interest pursuant to Section 6A of the Companies Act, 1965.
PROXY FORM
CDS account no. of authorized nominee.(1)
Dated this ______________________ day of _______________________________ 2015 For appointment of two (2) proxies, percentage of
shareholdings to be represented by the proxies:
No. of shares Percentage
No. of shares held Proxy 1
Signature/Common Seal of Member
Proxy 2
Tel No. : _______________________ Total 100%
Notes:
1. Applicable to shares held through a nominee account.
2. Only depositors whose names appear on the Record of Depository as at 21 May 2015 shall be entitled to attend, speak and vote at the meeting.
3. A member entitled to attend and vote at the meeting is entitled to appoint not more than two (2) proxies to attend and to vote in his stead. A proxy may but need not be a member
of the Company and the provision of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company.
4. Where a member appoints two (2) proxies, the appointment shall be invalid unless he specifies the proportion of his shareholdings to be represented by each proxy.
5. Where a member of the Company is an authorized nominee as defined under the Securities Industry (Central Depositories) Act 1991, it may appoint not more than two (2) proxies
in respect of each securities account it holds with ordinary shares of the Company standing to the credit of the said securities account.
6. Where a member of the Company is an exempt authorized nominee as defined under the Securities Industry (Central Depositories) Act 1991 which holds ordinary shares in the
Company for multiple beneficial owners in one (1) securities account (“omnibus account”), there is no limit to the number of proxies which the exempt authorized nominee may
appoint in respect of each omnibus account it holds.
7. The instrument appointing a proxy shall be in writing under the hand of the appointer or of his attorney duly authorized in writing or if the appointer is a corporation, either under its
common seal or under the hand of a duly authorized officer or attorney.
8. The Proxy Form shall be deposited at the Share Registrar of the Company, Tricor Investor Services Sdn Bhd, Level 17, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra,
59200 Kuala Lumpur, not less than forty-eight (48) hours before the time appointed for holding the meeting.
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AFFIX STAMP
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