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Inch Kenneth Kajang (IKK)

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Tuesday 26 April, 2016

Inch Kenneth Kajang

Annual Financial Report

RNS Number : 3309W
Inch Kenneth Kajang Rubber
26 April 2016
 

 

 

 

 

 

INCH KENNETH KAJANG RUBBER PUBLIC LIMITED COMPANY

 

 

GROUP ANNUAL REPORT AND FINANCIAL STATEMENTS

 

FOR THE YEAR ENDED 31 DECEMBER 2015

 

Click on, or paste the following link into your web browser, to view the associated PDF document.

http://www.rns-pdf.londonstockexchange.com/rns/3309W_1-2016-4-26.pdf 



 

CONTENTS

 

 

 

Corporate Information

1

 

 

 

 

 

 

Board of Directors' Profiles

3

 

 

 

 

 

 

Chairman's Statement

6

 

 

 

 

 

 

Strategic Report

8

 

 

 

 

 

 

Corporate Governance

11

 

 

 

 

 

 

Corporate Social Responsibilities

19

 

 

 

 

 

 

Corporate Sustainability Statement

20

 

 

 

 

 

 

Audit Committee Report

21

 

 

 

 

 

 

Statement on Internal Control

24

 

 

 

 

 

 

Group Financial Highlights

26

 

 

 

 

 

 

Directors' Report

28

 

 

 

 

 

 

Statement of Responsibilities of Those Charged With Governance

32

 

 

 

 

 

 

Statutory Declaration

33

 

 

 

 

 

 

Independent Auditors' Report

34

 

 

 

 

 

 

Group and Company Statement of Profit or Loss

36

 

 

 

 

 

 

Group and Company Statement of Profit or Loss and Other Comprehensive Income

37

 

 

 

 

 

 

Group and Company Statement of Financial Position

38

 

 

 

 

 

 

Group Statement of Changes in Equity

40

 

 

 

 

 

 

Company Statement of Changes in Equity

42

 

 

 

 

 

 

Group and Company Statement of Cash Flows

43

 

 

 

 

 

 

Notes to the Financial Statements

44

 

 

 

 

 

 

List of Properties Registered Under the Group of Companies

76

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Corporate Information

 

 

BOARD OF DIRECTORS

 

 

Dato' Adnan bin Maaruf

 

Independent Non-Executive Director/ Chairman

Datuk Kamaruddin bin Awang

 

Independent Non-Executive Director

Dato' Haji Muda bin Mohamed

 

Independent Non-Executive Director

Dato' Tik bin Mustaffa

 

Independent Non-Executive Director

Dr. Radzuan bin A. Rahman

 

Independent Non-Executive Director

 

 

 

AUDIT COMMITTEE

 

 

Datuk Kamaruddin bin Awang

 

Chairman

Dato' Haji Muda bin Mohamed

 

Member

Dato' Tik bin Mustaffa

 

Member

 

 

 

UK COMPANY NUMBER

 

SC007574

 

 

 

MALAYSIA COMPANY NUMBER

 

990261M

 

COMPANY SECRETARY

 

Lee Thai Thye (LS 0000737)

 

 

 

REGISTERED OFFICE IN UK

 

No. 2 Lochrin Square, 96 Fountainbridge

 

 

Edinburgh EH3 9QA, Midlothian, United Kingdom

 

 

Tel: 44 0131 226 5541 Fax: 44 0131 226 2278

 

 

 

PRINCIPAL OFFICE IN MALAYSIA

 

22nd Floor Menara Promet (KH)

Jalan Sultan Ismail

50250 Kuala Lumpur, Malaysia

 

 

Tel: 603-2144 4446 Fax: 603-2141 8463

 

 

 

PRINCIPAL REGISTRAR IN UK

 

Computershare Investor Services plc

 

 

PO Box 82, The Pavillions, Bridgwater Road

 

 

Bristol BS99 7NH, United Kingdom

 

 

Tel: 44 0870 702 0003 Fax: 44 0870 703 6101

 

 

 

REGISTRAR IN MALAYSIA

 

Mestika Projek (M) Sdn Bhd (225545V)

 

 

22nd Floor Menara Promet (KH)

Jalan Sultan Ismail

 

 

50250 Kuala Lumpur, Malaysia

 

 

Tel: 603-2144 4446 Fax: 603-2141 9650

 

 

 

AUDITORS

 

UHY Hacker Young LLP

 

 

Quadrant House

4 Thomas More Square

 

 

London E1W 1YW, United Kingdom

 

 

 

MANAGING AGENTS

 

Akem Links Sdn Bhd (790623D)

 

 

d/a Narsco Berhad

Km 0.5 Jalan Air Hitam

43800 Dengkil

Selangor

Malaysia

 

 

 

WEBSITE

 

www.ikkr.com.my

 

 

 

 



 

 

 

 

 

PRINCIPAL BANKERS

 

Bank Islam Malaysia Berhad

AmFunds Management Berhad

 

 

Agrobank Berhad

CIMB Bank Berhad

Affin Hwang Asset Management Berhad

Bank Kerjasama Rakyat Malaysia Berhad

 

 

 

 

 

 

STOCK EXCHANGE LISTINGS

 

Bursa Malaysia Securities Berhad - Main Board

 

 

London Stock Exchange plc

 

 

Singapore Exchange Securities Trading Limited

 

 



Board of Directors' Profiles

 

 

DATO' ADNAN BIN MAARUF

Independent Non-Executive Director

Chairman

Malaysian, aged 72

 

Dato' Adnan bin Maaruf was appointed to the Board on 22 April 2000.

 

He graduated from University of Malaya with a Bachelor of Arts (Honours) Degree and a Masters in Management from AIM Philippines. He started his career in the Government sector and after eighteen (18) years, became the Deputy Secretary General in the Ministry of National and Rural Development. He then became the Managing Director of Mara Holdings Sdn Bhd for five (5) years and subsequently, the Chairman of Malaysia Cooperative Insurance Society for ten (10) years.

 

He does not have any family relationship with any Director and/or major shareholder of the Company and there is no business arrangement with the Company in which he has a personal interest. He attended all the Board Meetings held in the financial year ended 31 December 2015.

 

He has had no convictions for any offences within the past 10 years.

 

DATUK KAMARUDDIN BIN AWANG

Independent Non-Executive Director

Chairman of the Audit Committee

Malaysian, aged 67

 

Datuk Kamaruddin bin Awang was appointed to the Board on 17 July 2009.  He is the Chairman of the Audit Committee.

 

He obtained his Bachelor of Commerce and Administration from Victoria University of Wellington, New Zealand, in 1973. He is a member of the Institute of the Chartered Accountants of New Zealand and Institute of Chartered Secretaries & Administrators, United Kingdom, since 1977. He was the Executive Chairman of Metacorp Berhad and had previously held directorships in a number of listed companies.

 

He does not have any family relationship with any Director and/or major shareholder of the Company and there is no business arrangement with the Company in which he has a personal interest. He attended all the Board Meetings held in the financial year ended 31 December 2015.

 

He has had no convictions for any offences within the past ten (10) years.

 

DATO' HAJI MUDA BIN MOHAMED

Independent Non-Executive Director

Member of the Audit Committee

Malaysian, aged 71

 

Dato' Haji Muda bin Mohamed was appointed to the Board on 15 February 2000. He is also a member of the Audit Committee.

 

He graduated with a Diploma in Civil Engineering and subsequently a Bachelor of Science, Civil Engineering Degree from University of Westminster, United Kingdom. A Fellow in the Institution of Engineers Malaysia, he started his career as an engineer in two Government agencies and an international oil company. After thirteen (13) years, he joined Sime UEP Properties Bhd and left ten (10) years later after becoming its Operation Director. He then went on to TTDI Development Sdn Bhd, and left seven (7) years later after serving as its Group Chief Executive Officer. He is now an Executive Chairman of a company dealing in civil engineering contracting jobs. He does not sit on the board of any other listed company.

 

He does not have any family relationship with any Director and/or major shareholder of the Company and there is no business arrangement with the Company in which he has a personal interest. He attended all the Board Meetings held in the financial year ended 31 December 2015.

 

He has had no convictions for any offences within the past ten (10) years.

 

 

DATO' TIK BIN MUSTAFFA

Independent Non-Executive Director

Member of the Audit Committee

Malaysian, aged 70

 

Dato' Tik bin Mustaffa was appointed to the Board on 6 July 2012.  He is also a member of the Audit Committee.

 

He holds a Bachelor's Degree in Economics from University of Malaya and a Master's Degree in Business Administration from University of Oregon, United States of America.

 

He started his career in the Malaysian Government Service where he served the Public Service Department, University Teknologi Malaysia, Ministry of Finance and Kuantan Port Authority. He also served the State Administrations of Pahang and Selangor as the State Finance Officer and State Secretary respectively.

 

In 1996, he joined Hicom Holdings Bhd as its Senior Vice President and was later appointed as its Senior Group Director for Operations in the merged entity of DRB-Hicom Bhd. He left in 2005, and in 2010, he became the Chairman for Eastern Pacific Industrial Corporation Berhad for a year. He is currently the Chairman/Director of Trumer International Sdn Bhd.

 

He does not have any family relationship with any of the Company's Directors and/or major shareholders and has no conflict of interest with the Company. He attended four (4) of the Board Meetings held in the financial year ended 31 December 2015.

 

He has had no convictions for any offences within the past ten (10) years.

 

 

DR. RADZUAN BIN A. RAHMAN

Independent Non-Executive Director

Malaysian, aged 72

 

Dr. Radzuan bin A. Rahman was appointed to the Board on 24 March 2005.

 

He graduated with a Bachelor's Degree in Agricultural Science from University of Malaya, and later pursued his Masters in Science and Doctorate in Resource Economics at Cornell University, New York. He was a lecturer and Dean at the faculty of Resource Economics and Agribusiness, Universiti Pertanian Malaysia (now known as Universiti Putra Malaysia) until March 1980. He then went to Sime Darby Plantations Berhad and in 1984, joined Golden Hope Plantations Berhad as a Director of Corporate Planning and worked his way up to be Group Director of the plantation division. He was later appointed as the Managing Director of Island & Peninsular Berhad and Austral Enterprises Berhad and retired in 2004. He was a Director of Fraser & Neave Holdings Berhad and Kuwait Finance House (Malaysia) Berhad. He currently sits on the boards of Idaman Unggul Berhad, Kulim (Malaysia) Berhad and several private companies.

 

He does not have any family relationship with any Director and/or major shareholder of the Company and there is no business arrangement with the Company in which he has a personal interest. He attended three (3) of the Board Meetings held in the financial year ended 31 December 2015.

 

He has had no convictions for any offences within the past ten (10) years.



 

DIRECTORS STANDING FOR RE-ELECTION AT THE ONE HUNDRED AND SIXTH ANNUAL GENERAL MEETING ("AGM")

 

Special Business:

 

i.              Pursuant to Section 129(6), Malaysian Companies Act 1965

·      Dato' Adnan bin Maaruf

·      Dato' Haji Muda bin Mohamed

·      Dr. Radzuan bin A. Rahman

 

ii.             Pursuant to Recommendations 3.2 and 3.3 of the Malaysian Code on Corporate Governance 2012

·      Dato' Haji Muda bin Mohamed

·      Dr. Radzuan bin A. Rahman

 

iii.            Pursuant to Section 129(6), Malaysian Companies Act 1965

·      Dato' Tik bin Mustaffa

 



Chairman's Statement

 

 

On behalf of the Board of Inch Kenneth Kajang Rubber Public Limited Company, I present herewith the One Hundred and Sixth Annual Report and Financial Statements of the Company and the Group for the financial year ended 31 December 2015.

 

DIVIDENDS

 

The Board has proposed an interim dividend payout of 2% (0.2 pence) as part of our commitment to deliver shareholders value, with the total dividends under the single tier system.

 

PERFORMANCE REVIEW

 

During the financial year under review, the Group recorded a revenue of RM10.289 million and a pre-tax loss of RM1.898 million compared to a revenue of RM23.639 million and a pre-tax loss of RM6.988 million for the previous year. The decrease in Group's turnover by RM13.350 million is mainly due to the lower sales of constant viscosity rubber ("CV rubber") blocks produced by the subsidiary in Thailand and less bookings received from the travel agents and online travel agents by the tourism division during the financial year under review.

 

The plantation division recorded lower revenue at RM0.376 million (2014: RM0.696 million) due to the decrease in crude palm oil ("CPO") price, coupled with a decline in production of fresh fruit bunches ("FFB") by 29% to 868 tonnes (2014: 1,231 tonnes). Revenue from the Group's tourism division also reduced by 19.7% from RM8.396 million in 2014 to RM6.744 million due to lower bookings received.

 

Included in the above results for the financial year under review was a share of profit after taxation of RM4.598 million versus share of loss after taxation of RM1.170 million in 2014 from the Group's associate - Concrete Engineering Products Berhad ("Cepco"), a manufacturer and distributor of prestressed spun concrete piles and poles. The increased sales volume is attributable to the overall increase in the overseas projects.

 

Overall, the total performance of the Group was mainly affected by the reduction in turnover.

 

CORPORATE DEVELOPMENT

 

The shareholders of the Company had approved an ordinary resolution at the One Hundred and Fifth AGM held on 16 June 2015 for the Company 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 and believe that the purchase plan is being implemented in the best interest of the Company and its shareholders.

 

As at 31 December 2015, the Company has 17,540,800 ordinary shares held as treasury shares and the issued and paid-up share capital of the Company remained at 420,750,000 ordinary shares of £0.10 each.

 

FUTURE OUTLOOK

 

The Master Plan to develop the land bank in Kajang, totalling approximately 140 hectares has been discussed several times with the Majlis Perbandaran Kajang (MPKJ). Apart from MPKJ, engagements with a few other relevant authorities such as Jabatan Mineral dan Geologi (JMG), Lembaga Lebuhraya Malaysia (LLM) and Jabatan Kerja Raya (JKR) are also ongoing. Feedbacks thus far have been very positive. Discussions with the Road Safety Audit, Environmental Impact Assessment and Market Study are also in the progress. The outcome of these discussions will make our total development to be more comprehensive and relevant to the current economic and population needs.

 

During this period, we have concurrently been interacting closely with a few major corporations which intend to have their presence at this development. Based on their positive responses, we strongly feel that this property development will be a major stimulus to the South Greater Klang Valley region.

 

As for the tourism division, the new room upgrades, additional facilities and rebranding exercise at Perhentian Island Resort are expected to bring in more guests for this year. As the resort is quite well known among tourists, we intend to do more revenue generating improvements during the fourth quarter to maximise the potential of the resort.

 

 

 

APPRECIATION

 

On behalf of the Board, I wish to express my appreciation to all our customers, shareholders, business partners, bankers and government authorities for their continued support and encouragement during the year.

 

Special thanks also go to the management, staff and all stakeholders for their continued support to the Group. Your unwavering support and understanding are much appreciated. We hope that success in the near future is forthcoming.

 

I would also like to take this opportunity to offer my personal gratitude to my fellow Board members for their commitment and guidance.

 

 

 



Strategic Report

 

 

REVIEW AND PERFORMANCE OF THE BUSINESS

 

The Group's principle activities remain unchanged throughout the year 2015. The plantations in Kajang and Bangi are still providing revenue through the sale of the FFB they produce, albeit at a lower volume.

 

ESTATES

The total area of the Group's estates as at 31 December 2015 is as follows:

 

              Hectares

 

2015

 

2014

 

 

 

 

Oil Palm (Mature)

177

 

177

Roads, buildings, gardens, nurseries and wasteland

12

 

12

 

 

 

 

Total

189

 

189

 

The yields from the plantation activity for the year ended 31 December 2015 were as follows:

 

Harvested crops

 

 

Fresh fruit

bunches

 

 

 

 

2015 (tonnes)

 

 

868

2014 (tonnes)

 

 

1,231

 

TOURISM

 

In Terengganu, both of the hotels within the Group recorded lower revenue due to less bookings received during the year, as reflected by the overall drop in the tourism sector in Malaysia.

 

MANUFACTURING

 

During the year, the sales from our rubber manufacturing subsidiary in Thailand were much lower at RM3.016 million (2014: RM14.385 million). This was mainly due to the drop in rubber prices and also due to lower demand as the buyers tend to remain in the sideline.

 

OVERALL

 

Overall, the Group's revenue was RM10.289 million for the year ended 31 December 2015 as compared to RM23.639 million in the preceding year, a decrease of 56%, mainly due to the lower sales of CV  rubber blocks produced by the subsidiary in Thailand and lower bookings received by the tourism division during the financial year under review.

 

The Group's results after tax reduced from a loss of RM7.127 million to a loss of RM1.941 million, or a loss per share of RM0.0048 (2014: loss per share of RM0.0177). The reduction in loss was due principally to the higher share of results of our associate, Cepco, of RM4.598 million.

 

With this result, the Group's Net Tangible Assets are now RM638.274 million (2014: RM630.931 million restated) or RM1.58 (2014: RM1.56 restated) per share, which is calculated after deducting the shares that were bought back. During the financial year ended 31 December 2015, there was no share buyback and no resale or cancellation of treasury shares. A total of 17,540,800 shares were bought back and retained as treasury shares as at 31 December 2015.

 

Despite the business activities of the Group remaining at approximately the same level as last year, the cash position available for use at the end of the 2015 financial year was RM26.755 million (2014: RM43.738 million) and short term investments of RM110.422 million (2014: RM123.719). The decline is mainly due to the payments made to finalise a land transaction, assets under construction and the dividend paid in June 2015.

 

At 31 December 2015, the Group had total assets of RM719.934 million compared to RM706.621 million in 2014. The Group's total liabilities stood lower at RM81.625 million compared to RM75.670 million at the prior year end. The resulting net assets were RM638.309 million at 31 December 2015 (2014: RM630.951 million restated). The current ratio is now at 41.66 (2014: 64.15).

 

RESULTS AND DIVIDENDS

 

The Group's results for the year are set out on page 38. The Group's loss attributable to shareholders of the Company for the financial year ended 31 December 2015 amounted to RM1.941 million (2014: loss of RM7.127 million).

 

On 6 May 2015, the Directors approved and declared a 2% interim dividend for the financial year ended 31 December 2014. The total amount of RM4.396 million was paid on 9 June 2015. The interim dividend was under the single tier system of RM0.0109 per share, on 403,209,200 ordinary shares. A dividend of 2% is proposed for the financial year ended 31 December 2015.

 

In the opinion of the Directors, the results of the operations of the Group and of the Company during the financial year were not substantially affected by any item, transaction or event of a material and unusual nature.

 

FUTURE DEVELOPMENTS AND PROJECTS

 

The Master Plan to develop the land bank in Kajang, totalling approximately 140 hectares has been discussed several times with the Majlis Perbandaran Kajang (MPKJ). Apart from MPKJ, engagements with a few other relevant authorities such as Jabatan Mineral dan Geologi (JMG), Lembaga Lebuhraya Malaysia (LLM) and Jabatan Kerja Raya (JKR) are also ongoing. Feedbacks thus far have been very positive. Discussions with the Road Safety Audit, Environmental Impact Assessment and Market Study are also in the progress. The outcome of these discussions will make our total development to be more comprehensive and relevant to the current economic and population needs.

 

During this period, we have concurrently been interacting closely with a few major corporations which intend to have their presence at this development. Based on their positive responses, we strongly feel that this property development will be a major stimulus to the South Greater Klang Valley region.

 

As for the tourism division, the new room upgrades, additional facilities and rebranding exercise at Perhentian Island Resort is expected to bring in more guests for this year. As the resort is quite well known among tourists, we intend to do more revenue generating improvements during the fourth quarter to maximise the potential of the resort.

 

This complies with Principle 1.4 of the Malaysian Code on Corporate Governance 2012.

 

No other events have occurred since the reporting date which significantly affects the Company or the Group.

 

PRINCIPAL RISKS AND UNCERTAINTIES FACING THE BUSINESSES

 

The principal risks and uncertainties facing the Group are:

 

i)           Exposure to the risks inherent to the oil palm and rubber industries

 

The Group is susceptible to certain business risks inherent to the oil palm and rubber industries as well as general business risks, which include but are not limited to:

 

(i)              constraints and rising costs of labour supply and raw materials;

(ii)             poor weather;

(iii)            price fluctuations of commodity;

(iv)            threat of substitute products; and

(v)             change in regulatory, economic and business conditions.

 

ii)             Exposure to the risks inherent in the property development industry

 

The Group is considering entering into property development. It will be exposed to the cyclical performance caused by the changes in the domestic and global economic conditions, which give rise to intense competition among the local players and new entrants in the property market. In addition, its profitability may also be affected by the changes in the economic and political environment such as changes in taxation, inflation, foreign exchange rates, government policies, population growth and accounting policies.

 

 

 

 

 

 

iii)          Exposure to the risks inherent to the tourism industry

 

The Group is subject to risks inherent to the hotel and tourism sector. These may include general global and regional economic downturns, uncertainties from terrorism activities and war, socio-political instability, a decrease in demand or an oversupply of hotel and resort rooms, an increase in the operating costs due to inflation and other factors such as energy and labour costs, labour supply shortages, changes in credit conditions, changes in customers' preferences and the collectability of debts.

 

INFORMATION TO SHAREHOLDERS

 

The Group has its own website (http://www.ikkr.com.my) for the purposes of improving information flow to shareholders and potential investors.

 

 

On behalf of the Board

 

 



Corporate Governance

 

 

THE MALAYSIAN CODE ON CORPORATE GOVERNANCE

 

It is the policy of the Company to manage the affairs of the Group in accordance with the appropriate standards for good corporate governance. Set out below is a statement on how the Company has applied the principles and complied with the recommendations as set out in the Malaysian Code on Corporate Governance 2012 ("MCCG 2012") except where stated otherwise.

 

THE UNITED KINGDOM CORPORATE GOVERNANCE REQUIREMENTS

 

The Financial Conduct Authority in the United Kingdom ("the FCA") requires the Company to comply with the FCA's Listing Rules 14.3.24 and 18.4.3(2) and Disclosure and Transparency Rule 7.2. The Annual Report contains below and in the Statement of Internal Control the information required by these rules.

 

BOARD OF DIRECTORS

 

Board Charter

 

The Board Charter was established in year 2002 to set out strategic intent and outline the Board's structure and procedures, code of conduct, roles and responsibilities and relationship of the Board to the management in accordance with Principle 1.3 and 1.7 of the MCCG 2012. The following paragraphs detail out the charter. The Board recognises the importance of the Board Charter and will adhere to it and will take steps to enhance the Board Charter from time to time.

 

Board Composition and Board Balance

 

The Board has five (5) members, comprising of all Independent Non-Executive Directors. This composition fulfils the requirements mandated by the Main Market Listing Requirements ("Main LR") of Bursa Malaysia Securities Berhad ("Bursa Securities") which stipulates that at least two (2) Directors or one-third of the Board, whichever is higher, must be independent. The Directors have wide ranging experience and all had occupied senior positions in the public and/or private sectors. A brief profile of each Director is presented on pages 3 to 4 of this Annual Report.

 

The balance between Independent Non-Executive Directors together with the support from management is to ensure that there is an effective representation for the shareholders. It further ensures that issues of strategy, performance and resources are fully addressed and investigated to take into account long-term interests of shareholders, relevant stakeholders and the community in which the Group conducts its business. The Independent Non-Executive Directors also bring independent judgement and challenge standards of conduct and fulfil a pivotal role in corporate accountability.

 

The Directors, with their different backgrounds and specialisations, collectively bring considerable knowledge, judgement and experience to the Board that has been vital to the direction of the Group.

 

No individual or group of individuals dominates the Board's decision making and the number of Directors reflects fairly the investment of the shareholders. The Board of Directors must select among them a Chairman, who, in accordance with Principle 3.4 of the MCCG 2012, must be a Non-Executive Director. If the Chairman is Non-Independent, then, in accordance with Principle 3.5 of the MCCG 2012, the Board must comprise a majority of Independent Directors. The Chairman of the Board is Dato' Adnan bin Maaruf.

 

The Board has not set a gender diversity target as of the reporting period. It is of the view that the Board membership should be determined based on a candidate's skills, experience and other qualities regardless of gender, but will nevertheless consider appointing Directors of the female gender where suitable.

 

A statement by the Directors and their responsibilities for preparing the financial statements is included on page 34.

 

 

 

 

 

 

 

 

 

Board Responsibilities

 

The Board plays a primary role in the conduct and control of the Group's business affairs. The Board is primarily responsible for the Group's overall strategic plans for business performance, succession planning, risk management, investor relations programmes, internal control, management information and statutory matters. The Board is required to commit their time in order to have an effective working partnership with the management in establishing the strategic direction and goals and in monitoring its achievement. This complies with Principle 1.1 of the MCCG 2012.

 

The presence of Independent Non-Executive Directors shall provide unbiased and independent views and judgement in the decision making process at the Board level and to ensure that no significant decisions and policies are made by any individual and that the interest of the minority shareholders are safeguarded. This complies with Principle 1.2 of the MCCG 2012.

 

The Board delegated specific powers and responsibilities to three (3) Board Committees namely, Audit, Nomination and Remuneration Committees, and the day to day operation matters to the management headed by the Group Chief Operating Officer.

 

 

Appointments to the Board

 

Appointment to the Board is based on the recommendations of the Nomination Committee established by the Board. This includes subsidiary companies. The Nomination Committee considers the required mix of skills and experience that the Directors should bring to the Board in making these recommendations. The Nomination Committee is responsible, inter alia, for making recommendations to the Board on new nominees for the Board including Board Committees and for assessing Directors on an ongoing basis. The Nomination Committee also reviews the Board's required mix of skills and experience and other qualities, including core competencies which Non-Executive Directors should bring to the Board.

 

The Board must show their commitment in terms of time and contribution. As such, before accepting any other appointment, it is courteous to inform the other Board members of their intention, in accordance with Principle 4.1 of the MCCG 2012.

 

 

Re-election

 

All Directors appointment to the Board are subject to the rules and regulations of the Malaysian Companies Act 1965 ("the Act") and the Company's Articles of Association ("the Articles").

 

In accordance with the Articles, all Directors shall retire from office at least once in each three (3) years and a retiring Director is eligible for re-election. 

 

An election of the Directors shall take place each year. At each AGM, one-third of the Directors for the time being (or if their number is not a multiple of three (3), the number nearest to but no greater than one-third) shall retire from office provided that all Directors shall retire from office at least once every three (3) years but shall be eligible for re-election.

 

The Articles further provide that all newly appointed Directors shall retire from office but shall be eligible for re-election in the next AGM subsequent to their appointment.

 

Directors over seventy (70) years of age are required to submit themselves for re-appointment annually in accordance with Section 129(6) of the Act.

 

The names of the Directors of the Company who are seeking re-election or re-appointment at the 106th AGM of the Company to be held on 24 May 2016 are set out in the Notice of AGM.

 

 

 

 

 

 

 

 

 

 

Tenure of Independent Directors

 

In accordance with Principle 3.2 and 3.3 of the MCCG 2012, the Board has recommended to retain those Independent Directors who have exceeded nine (9) years and shall seek shareholders' approval at the forthcoming AGM. The recommendation for the extension is detailed out in the Notice of AGM on page 80.

 

 

Supply of Information

 

The Board meets on a quarterly basis with additional meetings held whenever necessary. There were five (5) Board of Directors meetings held during the financial year ended 31 December 2015 and the details of attendance are set out as follows:

 

Name of Directors

No. of Meetings Attended

 

 

Dato' Adnan bin Maaruf

5/5

Datuk Kamaruddin bin Awang

5/5

Dato' Haji Muda bin Mohamed

5/5

Dato' Tik bin Mustaffa

4/5

Dr. Radzuan bin A. Rahman

3/5

 

 

Four (4) meetings were held at 22nd Floor Menara Promet (KH), Jalan Sultan Ismail, 50250 Kuala Lumpur.  One (1) meeting was held at Perhentian Island Resort, Pulau Perhentian Besar, Daerah Besut, 22200 Besut, Terengganu.

 

 

The Company Secretary was present at all Board of Directors meetings held during the financial year ended 31 December 2015, in accordance with Principle 1.6 of the MCCG 2012.

 

Prior to the Board meetings, the agenda together with the relevant documents and information are distributed to all Directors to ensure that Directors have sufficient time to review and be prepared for discussion. The Group Chief Operating Officer and/or other relevant key management personnel will provide information on the Group's performance and clarification on relevant issues and management's recommendations for deliberation and discussion by the Board prior to decision-making. Proceedings of Board meetings are recorded and signed by the Chairman of the meeting.

 

Apart from the above, the Board members are updated on the Company's activities and its operations on a regular basis.  Management's review and analysis on the Group's performance will be tabled to the Board every quarter for review. All Directors whether as a full board or in their individual capacity have access to all information of the Company on a timely basis in an appropriate form and quality necessary to enable them to discharge their duties and responsibilities.

 

All Directors have access to the advice and services of the Company Secretary and are entitled to seek independent professional advice, whenever necessary, at the expense of the Group. The appointment and removal of the Company Secretary are matters for the Board as a whole.

 

 

Directors' Training

 

The Board acknowledges the fact that continuous education is vital for the Board members to gain insight into the state of economy, manufacturing, technological advances in the core business and keep abreast of latest regulatory developments and management strategies. This complies with Principle 4.2 of the MCCG 2012.

 

The Board receives regular briefings and updates on the Group's businesses, operations, risk management, internal controls, corporate governance, finance and any new or changes to the relevant legislation, rules and regulations.

 

All the Directors have attended the Mandatory Accreditation Programme prescribed by Bursa Securities. During the year, the Senior Management are encouraged to attend courses whether in-house or external to help them in the discharge of their duties. The Directors have also attended the following seminars to broaden their perspective, skills, knowledge and to keep abreast of the relevant changes in law, regulations and the business environment:

 

 

 

 

Directors' Training (continued)

 

 

Directors

Seminar Title

Date

 

 

 

Dato' Adnan bin Maaruf

Board Chairman Series: "Tone from the Chair and Establishing Boundaries"

15 September 2015

Datuk Kamaruddin bin Awang

Analysis of Corporate Governance Disclosure in Annual Reports - Strengthening Corporate Governance Disclosure among the Listed Issuers

6 May 2015

 

CG Breakfast Series with Directors: "Future of Auditor Reporting - The Game Changer for Boardroom"

21 September 2015

Dato' Haji Muda bin Mohamed

Corporate Strategic Planning Coaching:  Programme for UEM Group Berhad Bumiputera Vendor Development Programme

17 & 18 December 2015

Dato' Tik bin Mustaffa

Analysis of Corporate Governance Disclosure in Annual Reports - Strengthening Corporate Governance Disclosure among the Listed Issuers

6 May 2015

Dr. Radzuan bin A. Rahman

Sustainability Symposium:  Responsible Business, Responsible Investing

8 October 2015

 

The Directors will continue to undergo other relevant training programmes and seminars from time to time as they consider necessary to equip themselves with the relevant knowledge and ideas to discharge their duties effectively.

 

 

BOARD COMMITTEES

 

The Board has set up Committees to delegate specific powers and responsibilities, all of which have their own written constitutions and terms of reference. The Chairman of the respective Committees reports to the Board the outcomes and recommendations thereon and minutes of such Committee meetings will be tabled for the Board's notation. The ultimate responsibility for the final decision on all matters of Board Committees lies with the entire Board. The Committees are as follows:

 

 

Audit Committee

 

The Audit Committee's terms of reference, which outline the Committee's functions, responsibilities and duties, are contained in the Audit Committee Report.

 

During the year, the Audit Committee has, inter alia, performed the following functions:

 

·      Reviewed the Group's quarterly and annual financial statements before announcing to Bursa Securities, Singapore Stock Exchange Securities Trading Limited ("SGX-ST") and London Stock Exchange plc ("LSE");

·      Reviewed with the external auditors, Messrs UHY Hacker Young LLP, the scope of their engagement, fees, as well as the accounting and reporting matters emanating from their examination of the annual financial statements;

·      Appraised on significant risk, control, regulatory and financial matters that have come to the attention of the external auditors in the course of their audit; and

·      Deliberated on the implications and effects of the relevant International Financial Reporting Standards which came into effect during the year.

 

The Committee is aware of the risk management, control and governance processes relating to critical corporate and operational areas. It also closely monitors the recommendations made in order to obtain assurance that all key risk and control concerns have been duly addressed and properly managed. This complies with Principle 6.1 of the MCCG 2012.

 

More information on the Audit Committee is given in the Audit Committee Report on pages 22 to 24.

 

 

 

 

 

 

Nomination Committee

 

In accordance with Principle 2.1 of the MCCG 2012, the Nomination Committee was established on 20 February 2003 and the members of the Nomination Committee comprises of:

 

(a)        Dato' Tik bin Mustaffa                                                           Chairman, Independent Non-Executive Director

(b)        Dato' Adnan bin Maaruf                                                       Member, Independent Non-Executive Director

(c)        Datuk Kamaruddin bin Awang                                             Member, Independent Non-Executive Director

 

The functions of the Nomination Committee as per Principle 2.2 of the MCCG 2012 include:

 

·    Assesses the effectiveness of the Board and the contribution of each individual Director;

·    Assesses the size of the Board and review the mix of skills and experience and other qualities required by the Board to function completely and efficiently;

·    Assesses and recommends new nominees for appointment to the Board and to the Boards of the Group's subsidiary companies;

·    Assesses independence of Independent Directors for recommendation to the shareholders for approval at the Company's general meeting in line with Principle 3.1 of the MCCG 2012.

 

The Company Secretary will ensure that all appointments are properly made and that all necessary information is obtained from the Directors.

 

The Nomination Committee has met three (3) times during the financial year ended 31 December 2015 to review all the Directors who are due for re-election and re-appointment at the Company's AGM, and to deliberate and nominate Directors to attend seminars.

 

Remuneration Committee

 

The Remuneration Committee was established on 20 February 2003.

 

The members of the Remuneration Committee are:

 

(a)        Dato' Haji Muda bin Mohamed                            Chairman, Independent Non-Executive Director

(b)        Datuk Kamaruddin bin Awang                             Member, Independent Non-Executive Director

(c)        Dr. Radzuan bin A. Rahman                                  Member, Independent Non-Executive Director

 

The Remuneration Committee has met twice (2) during the financial year ended 31 December 2015.

 

DIRECTORS' REMUNERATION REPORT

 

The Level and Make-up of Remuneration

 

The Remuneration Committee endeavours to ensure that the remuneration package offered is competitive to attract, retain and motivate senior executives of high calibre who will strive to achieve the Group's objectives. This complies with Principle 2.3 of the MCCG 2012.

 

The package may include basic salary, benefits and annual bonuses that will be based on the individual performance and dependent upon the achievement of predetermined targets. The Directors' fees and meeting allowances paid to all Directors, individually and per meeting respectively, are disclosed in note 11 to the financial statements.

 

There were no performance-related bonuses or other benefits given to any of the Directors during the 2015 financial year.

 

The fees for the Non-Executive Directors are determined by the Board and approved by the shareholders. The only other remuneration of the Non-Executive Directors is meeting allowances, which are set by the Board having taken advice on appropriate levels. During the 105th AGM, all shareholders unanimously voted "FOR" and approved the payment for Director's fees in respect of the year ended 31 December 2014.

 

The Committee has not set any policy on the Directors' Remuneration until the Group's Business Plan has been fully implemented.

 

 

 

The Level and Make-up of Remuneration (continued)

 

The Company does not have any pension scheme for its employees and Directors. The Company does, however, make the statutory contribution for its employees to the relevant regulatory body, the Employees Provident Fund in Malaysia. The fund operates as a defined contribution scheme. The Company does not have any long term incentive plans or share option schemes for its employees and Directors.

 

Procedure

 

The Remuneration Committee is responsible for making recommendations to the Board, within agreed terms of reference, on an overall remuneration package for the senior executives. The Committee has not engaged any person to advise and assist on any matters relating to the Directors' remuneration during 2015.

 

DISCLOSURE - INFORMATION SUBJECT TO AUDIT

 

During the year ended 31 December 2015, none of the Directors had any interests in the shares of the Company or Group undertakings.

 

The Directors' total remuneration comprises the following:

 

 

Basic

Salary &

Fees

(RM)

 

Meeting

Allowances

(RM)

 

Total

2015

(RM)

 

Total

2014

(RM)

Non-Executive Directors

 

 

 

 

Dato' Adnan bin Maaruf

40,000

6,000

46,000

46,000

Datuk Kamaruddin bin Awang

30,000

8,250

38,250

38,250

Dato' Haji Muda bin Mohamed

30,000

7,000

37,000

37,000

Dato' Tik bin Mustaffa

30,000

5,750

35,750

37,000

Dr. Radzuan bin A. Rahman

30,000

3,000

33,000

34,500

 

160,000

30,000

190,000

192,750

Staff cost (Note 10)

 

 

6.8 million

6.2 million

Directors' fee (%)

 

 

2.8%

3.1%

Dividend paid (page 44)

 

 

4.4 million

4.4 million

Directors' fee (%)

 

 

4.3%

4.4%

 

 

 

 

 

 

Pension Entitlements

 

The Company does not have a pension scheme in place.

 

Long-Term Incentive Plans

 

The Company does not have a long-term incentive plan in place.

 

Interest in Share Options

The Company does not have a share option scheme in place.

 

Excess Retirement Benefits of Directors and Past Directors

The Company does not have a retirement benefit scheme in place.

 

Compensation for Past Directors

There was no compensation made to the past Directors in respect of loss of office and pensions.

 

PERFORMANCE GRAPH

 

The Company's performance graphs required to be included in the Directors' Remuneration Report are shown on pages 27 to 28.

 

SHAREHOLDERS

 

 

Dialogue between the Company and its Investors

 

The Group believes in clear communications with its shareholders. The Annual Report and the quarterly announcements are the primary methods of communication to report the Group's business activities and financial performance to all shareholders. All such reporting information can be obtained from the website of Bursa Securities or the Group's website www.ikkr.com.my. This complies with Principle 7.2 of the MCCG 2012. Shareholders also have the opportunity to put questions at the AGM where the Directors are available to discuss aspects of the Group's business activities and performance. The shareholders may also forward their questions to the Company via e-mail at [email protected] or contact the Principal Office in Malaysia. This complies with Principle 8.3 of the MCCG 2012.

 

 

The AGM

 

The AGM remains the principal forum for dialogue with shareholders, wherein, the Board presents the operations and performance of the Group. During the meeting, shareholders are given every opportunity to enquire and comment on matters relating to the Group's business. The Chairman, members of the Board and senior management personnel are available to respond to shareholders' queries during this meeting. This complies with Principle 8.1 of the MCCG 2012. On any matter that requires the members present to decide, as per Principle 8.2 of the MCCG 2012, the Board will encourage poll voting if it is deemed necessary.

 

 

ACCOUNTABILITY AND AUDIT

 

 

Financial Reporting

 

The Board aims to provide and present a balanced and meaningful assessment of the Group's financial performance and prospects at the end of every quarter and the financial year, primarily through the annual financial statements and quarterly announcements of results to shareholders as well as the Chairman's Statement in the Annual Report. The Audit Committee assists the Board by reviewing the disclosure of information to ensure completeness, accuracy and validity. This complies with Principle 7.1 of the MCCG 2012.

 

 

Internal Control and Risk Management System

 

The Directors acknowledge their responsibility for the Group's system of internal controls covering not only financial controls but also operational and compliance controls, as well as risk management. The internal control system involves each subsidiary business and is designed to meet the needs of each subsidiary, to ensure that the risks faced by the business in pursuit of its objectives are identified and managed at known acceptable levels. The Group Chief Operating Officer has given his assurance that the Group's exposure to risk is limited to those mentioned in Note 28.3. The Group will be continuously reviewing the adequacy and integrity of its system of internal control. A full Statement on Internal Control is included on pages 25 and 26.

 

The Board also acknowledges the internal audit function as an integral part of an effective system of corporate governance. In this regard, the Board has taken steps to outsource the internal audit function.

 

 

Relationship with Auditors

 

The Board, via the establishment of the Audit Committee, maintains a formal and transparent relationship with the Company's auditors. The roles of the Audit Committee in relation to the auditors are detailed in the Audit Committee Report on page 22.

 

 

 

 

 

 

 

COMPLIANCE STATEMENT

 

The Board is satisfied that the Company had in 2015 complied with the best practices of MCCG 2012.

 

ADDITIONAL COMPLIANCE INFORMATION

 

Share Buy-Backs

 

During the financial year, there were no share buy-backs by the Company.

 

Options, Warrants or Convertible Securities

 

There was no grant or exercise of options, warrants or convertible securities during the financial year.

 

American Depository Receipt ("ADR") or Global Depository Receipt ("GDR") Programme

 

The Company did not sponsor any ADR or GDR programme during the financial year.

 

Imposition of Sanctions and/or Penalties

 

There were no sanctions and/or penalties imposed on the Company and its subsidiaries, Directors or management by the relevant regulatory bodies for the financial year under review.

 

Non-Audit Fees

 

The non-audit fees paid to the Company's external auditors amounted to RM3,457 for the financial year under review.

 

Profit Estimate, Forecast, Projections and Variation in Results

 

There were no variations of 10% or more between the audited results for the financial year ended 31 December 2015 and the unaudited results for the year ended 31 December 2015 of the Group previously announced. The Company did not make any release on profit estimates, forecasts or projections for the financial year.

 

Profit Guarantee

 

The Company did not give any profit guarantees during the financial year.

 

Material Contracts

 

There were no material contracts entered into by the Company and its subsidiaries involving Directors and major shareholders' interests.

 

Revaluation Policy on Freehold Land

 

The Group revalues its freehold lands whenever the market value of the revalued assets has changed materially from their carrying values and at least every five (5) years.

 

Employee Share Option Scheme ("ESOS")

 

There were no ESOS offered during the financial year ended 31 December 2015.

 

Corporate Social Responsibility ("CSR")

 

The Group is aware of its responsibility to its shareholders, human capital, environment and the community. Details of CSR are disclosed on page 20.

 

Recurrent Related Party Transactions

 

There were no transactions with related parties undertaken by the Group during the period under review except as disclosed in note 29 to the financial statements.

 

 

RESPONSIBILITY STATEMENT FOR PREPARING THE ANNUAL AUDITED FINANCIAL STATEMENTS

 

The Board has seen and approved the Annual Report and Audited Financial Statements for the year ended 31 December 2015 and collectively and individually accept full responsibility for the accuracy of the information given and confirm that after making reasonable enquiries to the best of their knowledge and belief, there are no other facts, the omission of which would make any statement or information therein misleading.

 

This Corporate Governance Statement, including the information on Directors' Remuneration, is made in accordance with the resolution of the Board of Directors dated 15 April 2016.

 

 

 

 



Corporate Social Responsibilities

 

The Group recognises that its performances are also measured by being a good corporate citizen and making more contribution to people and environment. We would therefore integrate our business activities so that our actions would benefit our employees as well as the surrounding society.

 

At Perhentian Island Resort ("PIR"), we place high importance in maintaining the natural environment in order to preserve the natural beauty of the corals existing just off our beach while protecting other marine life as well. Efforts have been made to ensure that the rainforest, being the ideal backdrop for our resort, is retained at its best. Development that may compromise the surrounding nature would not be undertaken. The cleanliness of the pristine water and white sandy beaches has always been of serious concern. Employees, customers and hotel guests are encouraged to share the same vision in protecting and sustaining good environmental care aspects. We also support the various events held at Pulau Perhentian Kecil where tourism activities are being carried out too.

 

At Motel Desa, the team spirit has always been instilled among the employees. We maintain the natural environment through various programs of recycling and gardening. We always strive to provide meaningful contributions towards the society, such as holding the buka puasa event for the needy every year. We also employ handicapped employees who have been specially trained to conduct their duties at the hotel.

 

At Supara Company Limited ("Supara"), we have been consistently participating in the To Be Number One antidrug campaign since 2003. It is a program that aims to prevent drug trafficking from spreading at workplaces in the country. We take serious concern in having a drug-free working environment by conducting urine test in every three (3) months and holding biannual medical check-up by Ministry of Health for all workers. We prohibit smoking at the factory premises and discourage workers from doing so at other time.

 

Other initiatives include planting trees and vegetables in the factory compound and participating in other government's moves to improve the environment. We take steps to reduce wastage and pollution during production by switching from diesoline to gas for drying of rubber. We ensure that no contamination occurs from our production by discharging it into our ponds before the water is released to the main drainage system.

 

At the Group level, employees are viewed as the key assets for its growth and also the main drivers of strength to each respective company. In this regard, employees are provided with a safe and conducive environment for both work and social advantages. Accommodations and other necessary facilities are provided to staff and workers at the rubber factory, plantation estates as well as the resort and hotel. They are also given adequate medical and health insurance benefits in the event of any untoward incident occurring.

 

The Group also makes an effort to create a workplace that is free from any form of discrimination and harassment where all employees have equal opportunities to realise their full potential. More interactions among the employees are encouraged by having sports events and annual dinners during the year. In 2015, the Company organised a trip to Beijing, China. Staffs were able to build a better rapport among themselves and discover the city where economic growth has been among the biggest in the world.

 



Corporate Sustainability Statement

 

Environmental sustainability is an ethical responsibility and a moral issue. The Group is committed in exercising its best efforts to conserve the environment through the following programs:

 

• Reduces greenhouse gas emissions by increasing energy efficiency and lowering its consumption. We actively try to find ways to reduce our carbon footprint while expanding our energy supply to meet the needs of our businesses. We invest in renewable energy by changing from diesel to gas at Supara and using solar heaters at PIR.

 

• Maintains water resource effectively by encouraging all of our business units to ensure sustainable consumption of water in their operations. We also make an effort to develop efficient ways to recycle water from our usage, and to explore alternative ways to generate clean water from the surrounding sources. At PIR, we use underground water supply to nurture plants and clean the surroundings.

 

• Encourages paperless operations within the Group. All staffs are advised to use electronic mails and keeping documents in softcopies.

 

• Uses more energy saving LED lights.

 

• Develops our resort based on the original environment and enhances the landscape by planting lush tropical vegetation where appropriate.

 

• Takes part in cleaning activities at the base of the ocean together with other environmental organisations to preserve the natural habitat of the marine park.

 

• Ensures that all water discharged from the business activities are properly filtered before it goes to the main drainage system.

 



Audit Committee Report

 

 

The Directors are pleased to present the Audit Committee Report of the Company in respect of the financial year ended 31 December 2015.

 

A.            COMPOSITION

 

The composition of the Audit Committee and designation of the Directors are as follows:

 

Members of the Committee

 

Datuk Kamaruddin bin Awang

Chairman (Independent Non-Executive Director)

 

Dato' Haji Muda bin Mohamed

Member (Independent Non-Executive Director)

 

Dato' Tik bin Mustaffa

Member (Independent Non-Executive Director)

 

Secretary to the Committee

 

Lee Thai Thye (LS 0000737)

 

B.            TERMS OF REFERENCE

 

The terms of reference of the Audit Committee comprise mainly the constitution, membership, authority, duties and responsibilities of the Audit Committee.

 

1.             Constitution

 

The Board of Directors has established a Committee of the Board known as the Audit Committee.

 

2.             Membership and Meetings

 

The Committee is appointed by the Directors and shall at all times comprise not less than three (3) members of whom all are Independent Non-Executive Directors. All members of the Audit Committee shall also be financially literate, and at least one of the members must fulfil the requirements of Rule 15.09 (c) of the Main LR. The Chairman of the Committee must be an Independent Non-Executive Director and shall be appointed by the Committee members. The Company Secretary shall act as the secretary to the Committee. There shall be at least four (4) meetings per year.

 

3.             Attendance at Audit Committee Meetings

 

Attendance at Audit Committee Meetings during 2015 was as follows:

 

 

Name of Directors

No. of Meetings Attended

 

 

Datuk Kamaruddin bin Awang

5/5

Dato' Haji Muda bin Mohamed

5/5

Dato' Tik bin Mustaffa

4/5

 

 

Four (4) meetings were held at 22nd Floor Menara Promet (KH), Jalan Sultan Ismail, 50250 Kuala Lumpur. One (1) meeting was held at Perhentian Island Resort, Pulau Perhentian Besar, Daerah Besut, 22200 Besut, Terengganu.

 

 

 

 

TERMS OF REFERENCE (continued)

 

 

4.             Authority

 

The Audit Committee has the authority to investigate any activity within its terms of reference, and shall obtain the cooperation of the other Board members, employees and external auditors, and any other external professional bodies which it considers necessary.

 

 

5.             Duties and Responsibilities

 

The Audit Committee's main duties and responsibilities are as follows:

 

a)             Reviews the audit plan with the external auditors.

 

b)            Reviews with the external auditors, the adequacy and effectiveness of the accounting and internal control systems.

 

c)             Acts upon problems and reservations arising from interim and final audits.

 

d)            Reviews the financial statements prior to the Directors' approval to ensure a fair and full presentation of the financial affairs of the Company and the Group, and that they comply with applicable financial reporting standards, as required by Principle 5.1 of the MCCG 2012.

 

e)             Assists in establishing an internal audit function and other appropriate control procedures, as required by Principle 6.2 of the MCCG 2012.

 

f)             Reviews internal audit reports and highlight to the Board any significant issues.

 

g)            Assists in conducting of management audits or other sensitive matters.

 

h)            Assesses the suitability and independence of the external auditors, in accordance with Principle 5.2 of the MCCG 2012.

 

i)              Makes recommendations to retain or replace the firm of external auditors and the agreement of the audit fee for the ensuing year.

 

 

6.             Summary of Activities

 

The Committee met five (5) times during the year for the following purposes:

 

a)             Reviewed the Group's quarterly and annual financial statements before recommending to the Board to approve for announcement to Bursa Securities, SGX-ST and LSE.

 

b)            Reviewed with the external auditors, Messrs UHY Hacker Young LLP, the scope of their engagement, fees as well as the accounting and reporting matters emanating from their examination of the annual financial statements.

 

c)             Appraised on significant risk, control, regulatory and financial matters that have come to the attention of the external auditors in the course of their audit.

 

d)            Deliberated on the implications and effects of the relevant International Financial Reporting Standards which came into effect during the year.

 

 

 

 

 

 

 

TERMS OF REFERENCE (continued)

 

 

7.             Internal Audit Function

 

The Group's internal control systems are reviewed by the outsourced internal auditor, together with external consultants. Their principal responsibility is to assist the Audit Committee in providing independent assessments for the adequacy, efficiency and effectiveness of the internal control systems to ensure compliance with the systems and standard operating procedures in the Group. The Group Internal Audit Department is independent from the activities or operations of other operating units.

 

A summary of the Internal Audit activities during the financial year under review is as follows:

 

a)             Performed operational audits on business units of the Group to ascertain the adequacy and integrity of their system of internal controls and made recommendations for improvement where weaknesses were found.

 

b)             Conducted follow-up review to determine the adequacy, effectiveness and timeliness of actions taken by the management on audit recommendations and provided updates on their status to the Audit Committee.

 

After each audit, the findings and recommendations for improvement were communicated to the respective management for their response and corrective actions. In this respect, the Internal Audit has added value by improving the control processes within the Group.

 

The total costs incurred by Group Internal Audit in discharging its functions and responsibilities in 2015 amounted to RM36,673 compared to RM59,785 in 2014.



 

Statement on Internal Control

 

 

The Board is pleased to make the following disclosures pursuant to Paragraph 15.26(b) of the Main LR of Bursa Securities, which requires the Board of Directors of public listed companies to include in its annual report "A statement about the state of internal control of the listed issuer as a group". The Board confirms that there is an ongoing process of identifying, evaluating and managing the significant risks faced by the Group, and that the process will be regularly reviewed by the Board and accords with 'The Statement on Internal Control - Guidance For Directors of Public Listed Companies'.

 

 

BOARD'S RESPONSIBILITY

 

In accordance with Principle 6 of the MCCG 2012, the Board is committed to maintaining a sound system of internal control to safeguard shareholders' investments and the Group's assets. Accordingly, the Board acknowledges its responsibility for the Group's overall system of internal control which includes the establishment of an appropriate control environment and framework as well as reviewing its adequacy and integrity. However, it should be noted that due to the limitations that are inherent in any system of internal control, such a system is designed to manage rather than eliminate the risk of failure to achieve the Group's business objectives. Accordingly, it can only provide reasonable and not absolute assurance against material misstatement or loss.

 

 

REVIEW PROCESS FOR INTERNAL CONTROL SYSTEM

 

In view of the size and nature of the Group's operations, the Group has an in-house function for the review of its internal control system, which forms part of the internal audit function. Currently the functions are focused on the most active subsidiaries. An external consultant has also been contracted to conduct certain system checks on the operational activities at Perhentian Island Resort Sdn Bhd.

 

The reports are presented to the Audit Committee. Being an independent function, the reports must be presented with impartiality, proficiency and due professional care.

 

The internal audit function facilitates the Board, through the Audit Committee, in carrying out its responsibility to review and evaluate the adequacy and integrity of the Group's internal control systems. The Board reviews matters pertaining to internal control which among others, includes the adequacy and integrity of the internal control systems of the Group. Reviews are carried out annually to provide independent assessments on the adequacy, efficiency and effectiveness of the Group's internal control systems in anticipating potential risk exposures over key business systems and processes and in controlling the proper conduct of businesses within the Group.

 

The internal audit function adopts a risk-based approach whereby the strategies and plans are prepared based on the risk profile of the Group. The plans will be presented to the Audit Committee for approval annually. The resulting reports will be reviewed by the Audit Committee and forwarded to the management for attention and necessary corrective actions. The management is responsible for ensuring any corrective actions on reported weaknesses are taken within the required time frame.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER CONTROL PROCEDURES

 

Apart from internal audit, there is an organisational structure with formally defined lines of responsibility and delegation of authority. This will provide a process of hierarchical reporting for an auditable trail of accountability.

 

The monitoring and management of the Group is delegated to the Exco Committee comprising of a few Board members and senior operational management. The committee, through their involvement in the business operations and attendance at senior management level meetings, manages and monitors the Group's financial performance, key performance indicators, operational effectiveness and efficiency, discusses and resolves significant business issues and ensures compliance with applicable laws, regulations, rules, directives and guidelines. These meetings serve as a two-way platform for the Board to communicate and address significant matters in relation to the Group's business and financial affairs and provide updates on significant changes in the businesses and the external environment that may result in any significant risks to the Group.

 

Internal control procedures are set out in standard operating practice and business process manuals and internal memos to serve as internal control guidance for proper measures to be undertaken and are subject to regular review, enhancement and improvement by the Internal Auditor.

 

REVIEW OF THIS STATEMENT

 

Pursuant to Paragraph 15.23 of the Main LR, the external auditors have reviewed this Statement and the Risk Management Statement for inclusion in the 2015 Annual Report, and reported to the Board that nothing has come to their attention that causes them to believe that the Statements are inconsistent with their understanding of the process adopted by the Board in reviewing the adequacy and integrity of the system of internal control.

 

This Statement on Internal Control is made in accordance with the resolution of the Board of Directors dated 15 April 2016.

 

 

 



Group Financial Highlights

 

 



2015

2014

2013

2012

2011

    2010

2009

2008

2007

2006


 

Financial Performance


restated























Revenue

RM'000

10,289

23,639

14,073

16,408

20,173

28,165

17,582

17,550

19,736

19,073


(Loss)/Profit Before Taxation

RM'000

(1,898)

(6,988)

(28,189)

4,757

(3,973)

(4,223)

1,483

(1,459)

874

(10,598)


(Loss)/Profit for the Year

RM'000

(1,941)

(7,127)

(28,497)

4,430

(4,164)

(4,918)

982

(1,540)

697

(10,878)


(Loss)/Earnings Per Share

Sen

(0.48)

(1.77)

(7.05)

1.06

(0.99)

(1.17)

0.23

(0.37)

0.17

(2.59)


Dividend Per Share (proposed/paid)

 

Sen

 

1.118

 

1.090

 

1.099

 

1.455

 

-

 

-

 

-

 

-

 

-

 

-




























Total Assets

RM'000

719,934

706,621

718,832

742,308

726,207

701,696

516,412

513,774

571,152

373,325


Share Capital

Shares'000

420,750

420,750

420,750

420,750

420,750

420,750

420,750

420,750

420,750

420,750


Treasury Shares

Shares'000

17,541

17,541

17,541

3,265

-

-

-

-

-

-


Shareholders' Equity

RM'000

638,309

630,951

713,807

737,855

719,023

653,182

486,826

486,017

540,263

338,974


Total Liabilities

RM'000

81,625

75,670

5,025

4,453

7,184

48,514

29,586

27,757

30,889

34,351


Borrowings

RM'000

-

-

-

24

94

15,455

22,727

20,030

23,840

11,300


Current Ratios

Times

41.66

64.15

44.65

55.90

36.77

8.24

3.36

0.60

0.54

0.52


Quick Ratios

Times

41.38

63.26

41.06

51.51

34.75

8.15

3.11

0.60

0.54

0.51


Debt-Equity Ratios

Times

0.00

0.00

0.00

0.00

0.00

0.02

0.05

0.04

0.04

0.03















Net Assets Per Share

RM

1.58

1.56

1.78

1.77

1.71

1.55

1.16

1.15

1.28

0.81


 

All figures are in RM thousands unless otherwise stated.

 

SHARE PRICE PERFORMANCE GRAPH

 

The graph below shows the movement of the Company's share price on Bursa Securities against the corresponding change in the Kuala Lumpur Composite Index ("KLCI") and the Group's Net Tangible Assets per share ("NTA per share"). The KLCI was selected as it represents a broad equity market index in which the Company is a constituent member.

 

 

 

 

 

 

 

 

 

 

 

  

 

 

   

DIRECTORS' REPORT

FOR THE YEAR ENDED 31 DECEMBER 2015

_______________________________________________________________________________________________

 

The Directors have pleasure in presenting their report, together with the audited financial statements of Inch Kenneth Kajang Rubber Public Limited Company ("the Company" or "the Parent") and its subsidiaries (together "the Group") for the financial year ended 31 December 2015.

 

Principal activities

 

The Company was incorporated in Scotland with company number SC007574, as a public company limited by shares.

 

The Company is involved in investment holding and carries on the business of an oil palm grower in Selangor, Malaysia.

 

The subsidiary undertakings are engaged in the operations of a block rubber manufacturer, tourist resort, retailing building supplies, property development and leasing of properties in Malaysia.

 

A more detailed review of the Group's operations is set out in the Chairman's Statement.

 

Group structure

 

The Group operates through its Parent and subsidiary companies, details of which are set out in note 15 to these financial statements.

 

Results and dividends

 

The Group's results for the year are set out on page 38. The Group's loss attributable to shareholders of the Company for the financial year ended 31 December 2015 amounted to RM1.941 million (2014: loss of RM7.127 million).

 

On 6 May 2015, the Directors approved and declared a 2% interim dividend for the financial year ended 31 December 2014. The total amount of RM4.396 million was paid on 9 June 2015.  The interim dividend was under the single tier system of 1.109 sen per share, on 403,209,200 ordinary shares. A dividend of 2% is proposed for the financial year ended 31 December 2015.

 

In the opinion of the Directors, the results of the operations of the Group and of the Company during the financial year were not substantially affected by any item, transaction or event of a material and unusual nature.

The Board plays an active role in the development of the Company's strategy. It has in place a strategy planning process, whereby the management presents to the Board its recommended strategy annually, together with its proposed business and regulatory plans for the ensuing year at a dedicated session, for the Board's review and approval. At this session, the Board deliberates both the management's and its own perspectives, and challenges the management's views and assumptions, to ensure the best outcome. In conjunction with this, the Board also reviews and approves the annual budget for the ensuing year, and sets the Key Performance Indicators (KPIs) under the Corporate Balanced Scorecard (CBS), ensuring that the targets correspond to the Company's strategy and business plan, reflect competitive industry trends and internal capabilities as well as provide sufficient stretch for the management.

 



DIRECTORS' REPORT

FOR THE YEAR ENDED 31 DECEMBER 2015

_______________________________________________________________________________________________

 

 

The following table indicates the areas that may be looked at for improvement:

 

 Department

Areas

 Finance

Return on Investment
Cash Flow
Return on Capital Employed
Financial Results (Quarterly/Yearly)

 

Internal Business Processes 

Number of activities per function
Duplicate activities across functions
Process alignment (is the right process in the right department)
Process bottlenecks
Process automation

 

Learning & Growth

Is there the correct level of expertise for the job
Employee turnover
Job satisfaction
Training/Learning opportunities

 

Customer

Delivery performance to customer
Quality performance for customer
Customer satisfaction rate
Customer percentage of market
Customer retention rate 

 

 

 

Post balance sheet events

 

No other events have occurred since the reporting period end which significantly affects the Company or the Group.



 

Directors

 

The Directors of the Company who held office during the year and at the date of this report are:

 

Dato' Adnan bin Maaruf

Datuk Kamaruddin bin Awang

Dato' Haji Muda bin Mohamed

Dato' Tik bin Mustaffa

Dr. Radzuan bin A. Rahman

 

In accordance with Malaysian Companies Act 1965 pursuant to Section 129(6), Dato' Adnan bin Maaruf, Dato' Haji Muda bin Mohamed, Dr. Radzuan bin A.Rahman and Dato' Tik bin Mustaffa retire from the Board at the forthcoming AGM, and being eligible, offer themselves for re-election.

 

Directors' interests

 

Neither at the end of the financial year ended 31 December 2015, nor at any time during that year, was there any arrangement to which the Company was a party, whereby the Directors could acquire benefits by means of the acquisition of shares in or debentures of, the Company or Group undertakings.

 

Since the end of the previous financial year, no Director has received or become entitled to receive any benefits (other than benefits included in the aggregate amount of emoluments received by the Directors as shown in the financial statements) by reason of a contract made by the Company or Group undertakings with any Director or with a firm of which he is a member, or with a company in which he has a substantial financial interest.

 

None of the Directors who held office during the financial year and to the date of this report, together with their immediate families, had any interests in the shares of the Company or Group undertakings.

 

Substantial shareholders

 

The Company has been notified, in accordance with Rule 5 of the United Kingdom's FCA's Disclosure and Transparency Rules, of the following interests in its ordinary shares as at 8 April 2016 by shareholders holding 3% or more of the share capital:

 

 

Number of

% of

 

shares of

Issued

Name

10p each

Capital

Concrete Engineering Products Berhad

58,088,000

14.41

Ng Ah Chai

50,283,200

12.47

Hamptons Property Sdn Bhd

49,327,700

12.23

FA Securities Sdn Bhd

29,672,500

7.36

Euston Technologies Sdn Bhd

22,662,066

5.62

 

No other person has notified an interest in the ordinary shares of the Company required to be disclosed to the Company in accordance with the United Kingdom's Companies Act 2006 ("UK Companies Act 2006").

 

No shareholders have any special rights or restrictions on voting rights attached to their shares.



 

Creditor payment policy and practice

 

It is the Group's policy that payments to suppliers are made in accordance with those terms and conditions agreed between the Group and its suppliers, provided that all trading terms and conditions have been complied with.

 

At 31 December 2015, the Group had an average of 15 days (2014: 2 days) purchase outstanding in trade payables.

 

Health and Safety

 

All aspects of health and safety at the Group's plantations are handled by our agent, Akem Links Sdn Bhd, and reviewed by the Board. The Company also places a high level of importance on health and safety aspects at its principal trading subsidiaries, Perhentian Island Resort Sdn Bhd, Motel Desa Sdn Bhd and Supara Company Limited. Any health and safety issues at these subsidiaries may be detrimental to its image and hence may affect revenues achieved.

 

Employees

 

The number of staff employed by the Group at the year end was 180 (2014: 192). At the resort, factory and estates, we provide employees with full quarters and required facilities, to provide a conductive environment, both for work and entertainment. 

 

Political and charitable donations

 

There were no political or charitable donations made by the Group during the year ended 31 December 2015 except for community support by the subsidiary, Perhentian Island Resort Sdn Bhd, to the village committee, as and when the need arose.

 

Environment

 

The Group's business is situated within areas that are subject to environmental conditions imposed by the local government authorities. All conditions have been fulfilled throughout the year. There have been no issues raised by the authorities pertaining to the day to day operation in relation to these conditions.

 

Financial instruments

 

Details of the Group financial instruments and risks management are disclosed in note 28.

 

Information to shareholders

 

The Group has its own website (http://www.ikkr.com.my) for the purposes of improving information flow to shareholders and potential investors.

 

 

Going concern

 

After making appropriate enquiries and examining those areas which could give rise to financial exposure, the Directors are satisfied that no material or significant exposures exist and that the Group has adequate resources to continue its operations for the foreseeable future. For this reason, and as further discussed in note 2.1, the Directors continue to adopt the going concern basis in preparing the Company's and Group's financial statements.



 

Auditors

 

In accordance with Section 489 of the UK's Companies Act 2006, a resolution proposing that UHY Hacker Young be re-appointed as auditors of the Company and that the Directors be authorised to fix their remuneration will be put to the next AGM.

 

 

On behalf of the Board

 

 



STATEMENT OF RESPONSIBILITIES OF THOSE CHARGED WITH GOVERNANCE

FOR THE YEAR ENDED 31 DECEMBER 2015

_______________________________________________________________________________________________

 

The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable United Kingdom company law and International Financial Reporting Standards as adopted by the European Union ("IFRS").

 

The Directors are required to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Group and of the Company and of the profit or loss and cash flows of the Group and of the Company for that period. In preparing those financial statements, the Directors are required to:

 

·    select suitable accounting policies and then apply them consistently;

·    make judgments and estimates that are reasonable and prudent;

·    present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;

·    prepare the financial statements on a going concern basis unless it is inappropriate to presume that the Group will continue in business;

·    provide additional disclosures when compliance with the specific requirements in IFRS is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity's financial position and financial performance; and

·    state that the Group and the Company has complied with IFRS, subject to any material departures disclosed and explained in the financial statements.

 

The Directors confirm that the financial statements comply with the above requirements.

 

The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Group and of the Company and to enable them to ensure that the financial statements comply with the UK's Companies Act 2006 and Article 4 of the International Accounting Standards (IAS) Regulation. The Directors are also responsible for safeguarding the assets of the Group and of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Group's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

 

Statement of disclosure to auditors

 

The Directors who were members of the Board at the time of approving this report are listed on page 1. Having made enquiries of fellow Directors and of the Company's auditors, each of these Directors confirms that:

 

-               to the best of each Director's knowledge and belief, there is no relevant audit information of which the Company's auditors are unaware; and

 

-               each Director has taken all the steps a Director might reasonably be expected to have taken to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information.

 

The United Kingdom Corporate Governance Statement

 

The Financial Conduct Authority in the United Kingdom ("the FCA") requires the Company to comply with the FCA's Listing Rules 14.3.24 and 18.4.3(2) and Disclosure and Transparency Rule 7.2. The Annual Report contains in the Statements of Corporate Governance and Internal Control the information required by these rules.

 

Disclosures in respect of the Malaysian Code on Corporate Governance 2012

 

As required by the Main LR of Bursa Securities, the Annual Report contains a Corporate Governance Statement pursuant to the MCCG 2012.

 



STATUTORY DECLARATION

PURSUANT TO SECTION 169 (16) OF THE MALAYSIAN COMPANIES ACT, 1965

_______________________________________________________________________________________________

 

I, HUSSAIN AHMAD BIN ABDUL KADER, being the officer primarily responsible for the financial management of Inch Kenneth Kajang Rubber Public Limited Company, do solemnly and sincerely declare that the accompanying financial statements set out on pages 38 to 77 are in my opinion correct and make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960.

 

 

Subscribed and solemnly declared by

The above named HUSSAIN AHMAD BIN ABDUL KADER

at Kuala Lumpur in the Federal Territory on

15 April 2016

 

                                                                                                                                HUSSAIN AHMAD BIN ABDUL KADER

 

 

 

 

 



INDEPENDENT AUDITORS' REPORT

TO THE SHAREHOLDERS OF INCH KENNETH KAJANG RUBBER PUBLIC LIMITED COMPANY

FOR THE YEAR ENDED 31 DECEMBER 2015

We have audited the financial statements of Inch Kenneth Kajang Rubber Public Limited Company for the year ended 31 December 2015 which comprise of the Group and Company Statement of Profit or Loss, Group and Company Statement of Profit or Loss and Other Comprehensive Income, Group and Company Statement of Financial Position, Group and Company Statement of Changes in Equity, Group and Company Statement of Cash Flows and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRS) as adopted by the European Union.

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

 

Respective responsibilities of directors and auditors

 

As explained more fully in the Statement of Responsibilities of those Charged with Governance set out on page 34, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view.

 

Our responsibility is to audit the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's (APB's) Ethical Standards for Auditors.

 

Scope of the audit of the financial statements

 

A description of the scope of an audit of financial statements is provided on the APB's website at www.frc.org.uk/apb/scope/private.cfm.

 

Opinion on financial statements

In our opinion:

·      the financial statements give a true and fair view of the state of the Group's and of the Parent Company's affairs as at 31 December 2015 and of the Group's and the Parent Company's loss for the year then ended;

·      the financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union; and

·      the financial statements have been prepared in accordance with the requirements of the UK Companies Act 2006; and, as regards the Group financial statements, Article 4 of the IAS Regulation.

 

Opinion on other matters prescribed by the UK Companies Act 2006

In our opinion:

·      the part of the Directors' Remuneration Report included within the Corporate Governance Statement relating to Directors' remuneration to be audited has been properly prepared in accordance with the UK Companies Act 2006;

·      the information given in the Directors' Report and the Strategic Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

·      the information given in the Corporate Governance Statement set out on pages 11 to 19 with respect to internal control and risk management systems in relation to financial reporting processes and the information about share capital structures in the Directors' Report is consistent with the financial statements.



INDEPENDENT AUDITORS' REPORT

TO THE SHAREHOLDERS OF INCH KENNETH KAJANG RUBBER PUBLIC LIMITED COMPANY

FOR THE YEAR ENDED 31 DECEMBER 2015

 

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the UK Companies Act 2006 requires us to report to you if, in our opinion:

·              adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit have not been received from branches not visited by us; or

·              the Parent Company's financial statements and the part of the Directors' Remuneration Report included within the Corporate Governance Statement relating to Directors' remuneration to be audited are not in agreement with the accounting records and returns; or

·              certain disclosures of Directors' remuneration specified by law are not made; or

·              we have not received all the information and explanations we require for our audit.

 

 

 

 

Quadrant House

4 Thomas More Square

London E1W 1YW

 

19 April 2016

 

                The maintenance and integrity of the Inch Kenneth Kajang Rubber Public Limited Company website is the responsibility of the directors; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the website; and legislation governing the preparation and dissemination of financial statements may differ from one jurisdiction to another.

 



GROUP AND COMPANY STATEMENT OF PROFIT OR LOSS

FOR THE YEAR ENDED 31 DECEMBER 2015

________________________________________________________________________________________________

 



GROUP


COMPANY


Notes

2015

2014


2015

2014



RM'000

RM'000


RM'000

RM'000















Revenue

4

10,289

23,639


376

696



 

 




Cost of sales


(4,968)

(18,520)


(305)

(445)



 

 




Gross profit


5,321

5,119


71

251



 

 




Other income

5

618

5,450


699

4,402

Administrative expenses


(16,801)

(16,122)


(8,215)

(7,417)

Selling and marketing expenses

 

(330)

(948)


-

-



 

 






 

 




Operating loss

6

(11,192)

(6,501)


(7,445)

(2,764)



 

 




Finance income

7

4,554

4,759


4,462

4,576

Finance costs

7

-

-


-

-

Other gains and losses

5

142

424


80

413

Share of results of associate

16

4,598

(1,170)


-

-

Impairment of investment in associate

16

-

(4,500)


-

(4,500)



 

 






 

 




Loss  before taxation


(1,898)

(6,988)


(2,903)

(2,275)



 

 




Taxation

8

(43)

(139)


-

-



 

 




Loss for the year


(1,941)

(7,127)


(2,903)

(2,275)



 

 




Attributable to:


 

 




 Equity holders of the Company


(1,941)

(7,127)


(2,903)

(2,275)



 

 


 

 

Loss  per share (Sen):

9

 

 




    Basic


(0.48)

(1.77)




    Diluted


(0.48)

(1.77)






 

 




Net dividend per share (Sen)


1.118

1.090




 

The results for 2015 and 2014 relate entirely to continuing operations.

 



GROUP AND COMPANY STATEMENT OF PROFIT OR LOSS

AND OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2015

________________________________________________________________________________________________







GROUP


COMPANY


2015

2014


2015

2014


RM'000

RM'000


RM'000

RM'000



restated










Loss for the year

(1,941)

(7,127)


(2,903)

(2,275)

 

Other comprehensive income:

 

 

 

 

 


 

 

 

 

 

Items that will not be reclassified subsequently

to profit or loss

 

 

 

 

 

Revaluation of properties, net of tax

12,557

750

 

3,750

-


 

 

 

 

 

Items that may be reclassified subsequently

 

 

 

 

 

to profit or loss

 

 

 

 

 

Revaluation of available-for-sale investments

    and short term investments

 

214

 

(412)

 

 

130

 

(368)

Reclassification adjustments on short term

    investments

 

(189)

 

15

 

 

(167)

 

14


 

 

 

 

 

Exchange differences on translating foreign operations

1,113

(58)

 

-

-


 

 

 

 

 

Other comprehensive income, net of tax

13,695

295

 

3,713

(354)


 

 

 

 

 

Total comprehensive income/(loss) for the year

 

11,754

 

(6,832)

 

 

810

 

(2,629)


 

 

 

 

 

 



GROUP AND COMPANY STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2015

 

 

 

 

GROUP

 

COMPANY

 

 

Notes

2015

2014

 

2015

2014

 

 

 

RM'000

RM'000

 

RM'000

RM'000

 

ASSETS

 

 

restated

 

 

restated

 

Non-current assets

 

 

 

 

 

 

 

Property, plant and equipment

12

462,381

441,712

 

119,774

111,080

 

Investment property

13

71

72

 

-

-

 

Intangible assets

14

35

20

 

32

18

 

Investments in subsidiaries

15

-

-

 

237,075

231,116

 

Investment in associate

16

24,740

20,142

 

18,146

18,146

 

Available-for-sale investments

17

84

57

 

13

20

 

Goodwill

18

71

71

 

-

-

 

 

 

487,382

462,074

 

375,040

360,380

 

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

Assets held for sale

19

-

29,654

 

-

-

 

Inventories

20

1,555

3,410

 

-

-

 

Trade and other receivables

21

93,820

44,026

 

1,299

1,148

 

Short term investments

22

110,422

123,719

 

107,940

119,263

 

Cash and cash equivalents

23

26,755

43,738

 

24,275

29,843

 

 

 

232,552

244,547

 

133,514

150,254

 

TOTAL ASSETS

 

719,934

706,621

 

508,554

510,634

 

 

 

 

 

 

 

 

 

EQUITY AND LIABILITIES

 

 

 

 

 

 

 

Equity attributable to shareholders

    of the Company

 

 

 

 

 

 

Share capital

24

287,343

287,343

 

287,343

287,343

 

Share premium

 

8

8

 

8

8

 

Property revaluation reserve

 

228,085

215,528

 

68,700

64,950

 

Investment revaluation reserve

 

15,222

15,197

 

(417)

(380)

 

Foreign currency translation reserve

 

(190)

(1,303)

 

-

-

 

Retained earnings

 

123,821

130,158

 

144,747

152,046

 

 

 

654,289

646,931

 

500,381

503,967

 

Less : Treasury shares

25

(15,980)

(15,980)

 

(15,980)

(15,980)

 

Total Equity

 

638,309

630,951

 

484,401

487,987

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Trade and other payables

26

5,507

3,737

 

1,238

982

 

Taxation payable

 

75

75

 

-

-

 

 

 

5,582

3,812

 

1,238

982

 

Non-current liabilities

 

 

 

 

 

 

 

Employee entitlements

27

15

15

 

15

15

 

Deferred tax liabilities

8

76,028

71,843

 

22,900

21,650

 

 

 

76,043

71,858

 

22,915

21,665

 

Total Liabilities

 

81,625

75,670

 

24,153

22,647

 

 

TOTAL EQUITY AND LIABILITIES

 

 

719,934

 

706,621

 

 

508,554

 

510,634

 

 



GROUP AND COMPANY STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2015

 

 

 

The financial statements of Inch Kenneth Kajang Rubber Public Limited Company [registered numbers: SC007574 (Scotland) and 990261M (Malaysia)] were approved by the Board of Directors on 15 April 2016 and signed on its behalf by:

 

 

 



GROUP STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2015

_________________________________________________________________________________________________

 

 


Share

Share

Property

Investment

Foreign

Retained

Treasury

Total


Capital

Premium

Revaluation

Revaluation

Currency

Earnings

Shares

Equity




Reserve

Reserve

Translation





RM'000

RM'000

RM'000

RM'000

RM'000

RM'000

RM'000

RM'000

Year ended 31 December 2015









At 1 January 2015

287,343

8

215,528

15,197

(1,303)

130,158

 

(15,980)

630,951










Total comprehensive income for year

 

-

 

-

 

12,557

 

25

 

1,113

 

(1,941)

 

 

-

 

11,754

Dividends paid

-

-

-

-

-

(4,396)

 

-

(4,396)










At 31 December 2015

287,343

8

228,085

15,222

(190)

123,821

 

(15,980)

638,309



















Year ended 31 December 2014









 

At 1 January 2014

 (as previously reported)

287,343

8

286,371

12,709

(1,245)

144,601

 

 

 

(15,980)

713,807










Adjustments

 (see note 31)

-

-

(71,593)

2,885

-

(2,885)

 

-

(71,593)










At 1 January 2014  (restated)

287,343

8

214,778

15,594

(1,245)

141,716

 

(15,980)

642,214

Total comprehensive

loss for year

 

-

 

-

 

750

 

(397)

 

(58)

 

(7,127)

-

 

(6,832)

Dividends paid

-

-

-

-

-

(4,431)

 

-

(4,431)










At 31 December 2014

287,343

8

215,528

15,197

(1,303)

130,158

 

(15,980)

630,951










 



GROUP STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2015

_________________________________________________________________________________________________

 

Share capital represents the nominal value of ordinary shares issued to shareholders of the company. The amount of share capital a company reports on its statement of financial position only accounts for the initial amount for which the original shareholders purchased the shares from the issuing company. Any price differences arising from price appreciation/depreciation as a result of transactions in the secondary market are not included.

 

Share premium is a contribution made by a shareholder when shares are issued and paid-in above the par value of such shares.

 

Property revaluation reserve is the capital reserve where changes in the value of the properties are recognised when they are revalued.

 

Investment revaluation reserve is the change in the value of investments recognised when they are revalued.

 

Foreign currency translation reserve represents the exchange differences resulting from the retranslation of net investments in subsidiary undertakings.

 

Retained earnings are net earnings not paid out as dividends, but retained by the company to be reinvested in its core business.

 

Treasury shares are those issued but re-purchased by the company. They are considered as issued but not outstanding and are not therefore included when calculating earnings per share and are not entitled to receive dividends. Treasury shares are treated as a reduction from equity.

 



COMPANY STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2015

_________________________________________________________________________________________________

 

 

 

Share

Share

Property

Investment

Retained

Treasury

Total

 

Capital

Premium

Revaluation

Revaluation

Earnings

Shares

Equity

 

 

 

Reserve

Reserve

 

 

 

 

RM'000

RM'000

RM'000

RM'000

RM'000

RM'000

RM'000

 

 

 

 

 

 

 

 

Year ended 31 December 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 1 January 2015

287,343

8

64,950

(380)

152,046

(15,980)

487,987

 

 

 

 

 

 

 

 

Total comprehensive income for year

-

-

3,750

(37)

(2,903)

 

-

810

 

 

 

 

 

 

 

 

Dividends paid

-

-

-

-

(4,396)

-

(4,396)

 

 

 

 

 

 

 

 

At 31 December 2015

287,343

8

68,700

(417)

144,747

 

(15,980)

484,401

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended 31 December 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 1 January 2014

(as previously reported)

287,343

8

86,600

(2,911)

161,637

 

 

(15,980)

516,697

 

 

 

 

 

 

 

 

Adjustments

(see note 31)

-

-

(21,650)

2,885

(2,885)

 

-

(21,650)

 

 

 

 

 

 

 

 

At 1 January 2014 (restated)

287,343

8

64,950

(26)

158,752

 

(15,980)

495,047

 

 

 

 

 

 

 

 

Total comprehensive loss for year

-

-

-

(354)

(2,275)

 

-

(2,629)

 

 

 

 

 

 

 

 

Dividends paid

-

-

-

-

(4,431)

-

(4,431)

 

 

 

 

 

 

 

 

At 31 December 2014

287,343

8

64,950

(380)

152,046

 

(15,980)

487,987

 

 



GROUP AND COMPANY STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 DECEMBER 2015

____________________________________________________________________________________________

 


 

GROUP

 

COMPANY

 


 

2015

2014

 

2015

2014

 

 

 

RM'000

RM'000

 

RM'000

RM'000

 

Cash flows from operating activities

 

 

 

 

 

 

 

Operating loss

 

 

(11,192)

(6,501)

 

(7,445)

(2,764)

 

Adjustments for items not requiring an outflow of funds:

 

 

 

 

 

 

 

Dividend income

 

-

(1)

 

-

(1)

 

Fixed assets written off

 

-

135

 

-

12

 

Provision for diminution in value of stocks

 

81

925

 

-

-

 

Depreciation and amortisation

 

1,777

1,656

 

30

32

 

Operating loss before changes in working capital

 

(9,334)

(3,786)

 

(7,415)

(2,721)

 

 

Changes in working capital:

 

 

 

 

 

 

 

Decrease in inventories

 

1,774

13,640

 

-

-

 

(Increase)/decrease in trade and other receivables

 

(19,075)

(13,511)

 

(151)

787

 

Increase/(decrease) in trade and other payables

 

1,997

(1,155)

 

256

(1,241)

 

Taxation refunded

 

-

23

 

-

-

 

Taxation paid

 

 

(270)

(272)

 

-

-

 

Net cash used in operating activities

 

(24,908)

(5,061)

 

(7,310)

(3,175)

 

 

 

 

 

 

 

 

 

Investing activities

 

 

 

 

 

 

 

Proceeds from disposal of property, plant and equipment

 

58

12

 

-

-

 

Proceeds from disposal of investments

 

36,450

34,337

 

34,350

33,736

 

Interest and dividends received

 

4,554

4,760

 

4,462

4,576

 

Loans granted to subsidiaries

 

-

-

 

(5,959)

(16,038)

 

Payments to acquire investments

 

(23,064)

(11,426)

 

(22,977)

(10,155)

 

Payments to acquire intangible assets

(31)

(9)

 

(28)

(9)

 

Payments to acquire property, plant and equipment

(5,646)

(3,037)

 

(3,710)

(1,076)

 

 

Net cash generated from investing activities

 

12,321

24,637

 

     6,138  

11,034

 

 

 

 

 

 

 

 

 

Financing activities

 

 

 

 

 

 

 

Dividends paid

 

 

(4,396)

(4,431)

 

(4,396)

(4,431)

 

Net cash used in financing activities

 

(4,396)

(4,431)

 

(4,396)

(4,431)

 

 

 

 

 

 

 

 

 

(Decrease)/increase in cash and cash equivalents

 

(16,983)

15,145

 

(5,568)

3,428

 

Cash and cash equivalents at 1 January

 

43,738

28,593

 

29,843

26,415

 

Cash and cash equivalents at 31 December

 

26,755

43,738

 

24,275

29,843

 


 

 

 

 

 

 

 

Cash and cash equivalents comprise of:

 

 

 

 

 

 

 

Short term deposits

 

23,926

29,629

 

23,716

28,680

 

Cash and bank balances

 

2,829

14,109

 

559

1,163

 


 

26,755

43,738

 

24,275

29,843

 

 



NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

1.             Corporate information

The consolidated financial statements of Inch Kenneth Kajang Rubber Public Limited Company ("the Company") and its subsidiaries (together "the Group") for the year ended 31 December 2015 were authorised for issue by the Directors on 15 April 2016. Inch Kenneth Kajang Rubber Public Limited Company is a public limited company incorporated in Scotland. Its shares are publicly traded on Bursa Securities, SGX-ST and LSE. The principal activities of the Group are oil palm plantation owners, tourism resort operators, manufacturers of constant viscosity (CV) block rubber and property development. Further information on the Company's subsidiaries is in note 15.

 

2.            Accounting policies

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated below.

 

2.1          Basis of preparation and going concern

The Group's financial statements are prepared on a going concern basis and in accordance with International Financial Reporting Standards, as adopted by the European Union ("IFRS") and in accordance with those parts of the UK's Companies Act 2006 applicable to companies preparing their accounts in accordance with IFRS.

 

The Company's financial statements have also been prepared in accordance with IFRS and the UK Companies Act 2006.

 

The financial statements of the Group and Company are prepared on an historical cost basis as modified by the revaluation of freehold lands and available-for-sale investments.

 

The Group's financial statements are presented in Ringgit Malaysia and all values are rounded to the nearest thousand (RM'000) except when otherwise indicated. The exchange rate of Ringgit Malaysia to Pounds Sterling at 31 December 2015 was £1: RM6.3607 (RM1: £0.1572) and 31 December 2014 was £1: RM5.4454 (RM1: £0.1836).

 

Going concern

During the year ended 31 December 2015 the Group made a loss of RM1.941 million (2014: loss of RM7.127 million) and at the year end date the Group had net current assets of RM226.97 million (2014: RM240.74 million) and net assets of RM638.31 million (2014: RM630.95 million restated). The operations of the Group are currently being financed by funds raised from the Group's operations and proceeds from disposal of land in year 2011. The Group has adequate resources to continue its operations for the foreseeable future as there are assets available that could be converted to cash or cash equivalents, should the need arise. The financial statements have, therefore, been prepared on the going concern basis. 

 

2.2                          New IFRS Standards and Interpretations

The Group has adopted all relevant standards effective for accounting periods beginning on or after 1 January 2015 from the beginning of the reporting period.

 

As at end of the reporting period, the Group has not adopted the following standards as it is either not effective or not applicable to the Group's business.

 

Standards, amendments and interpretations

                                                                                                                                                               

-       Amendments to IAS 16 and IAS 41: Bearer Plants (June 2014) - EU effective date 1 January 2016;

-       Amendments to IFRS 11: Accounting for Acquisitions of Interests in Joint Operations (May 2014) - EU effective date 1 January 2016;

-       Amendments to IAS 16 and IAS 38: Clarification of Acceptable Methods of Depreciation and Amortisation (May 2014) - EU effective date 1 January 2016;

-       Annual improvements to IFRSs 2012 - 2014 Cycle (September 2014) - EU effective date 1 January 2016;

-       Amendments to IAS 1: Disclosure Initiative (December 2014) - EU effective date 1 January 2016;

-       Amendments to IAS 27: Equity Method in Separate Financial Statements (August 2014) - EU effective date 1 January 2016.

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

2.2          New IFRS Standards and Interpretations (continued)

 

Standards, amendments and interpretations (not yet endorsed by EU at 30 March 2016)

 

-       IFRS 9 Financial Instruments (July 2014);

-       IFRS 14 Regulatory Deferral Accounts (January 2014);

-       IFRS 15 Revenue from Contracts with Customers (May 2014) including amendments to IFRS 15: Effective date of IFRS 15 (September 2015);

-       IFRS 16 Leases (January 2016);

-       Amendments to IFRS 10, IFRS 12 and IAS 28: Investment Entities: Applying the Consolidation Exception (December 2014);

-       Amendments to IFRS 10 and IAS 28: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture (September 2014);

-       Amendments to IAS 12: Recognition of Deferred Tax Assets for unrealised Losses (January 2016);

-       Amendments to IAS 27: Disclosure Initiative (January 2016).

 

Except for those in issue but not yet adopted above that the Directors anticipate will have material effect on the reported income or net assets of the Group.

 

2.3          Basis of consolidation and goodwill

The Group financial statements incorporate the financial statements of the Company and entities controlled by the Company and its subsidiaries. Control is achieved where the Company: has power over the investee; is exposed, or has rights, to variable returns from its involvement with the investee; and has the ability to use its power to affect its return.

 

The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control listed above.

 

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the period are included in the consolidated statement of profit or loss and other comprehensive income from the date the Company gains control until the date when the Company ceases to control the subsidiary.

 

Where necessary, adjustments are made to the financial statements of the subsidiaries to bring their accounting policies into line with the Group's accounting policies.

 

The consolidated financial statements have been prepared by using the principles of acquisition accounting ("the purchase method") which includes the results of the subsidiaries from their date of acquisition.

 

All intra-group balances, transactions, income and expenses and profits and losses resulting from intra-group transactions are eliminated fully on consolidation.

 

Goodwill is the difference between the amount paid on the acquisition of a subsidiary company or a business and the aggregate fair value of the identifiable assets and liabilities acquired. Goodwill is capitalised as an intangible asset. In accordance with IFRS 3 'Business Combinations', goodwill is not amortised but tested for impairment annually or when there are any other indications that its carrying value is not recoverable.

 

Goodwill is therefore stated at cost less any provision for impairment in value. If a subsidiary undertaking is subsequently sold, goodwill arising on acquisition is taken into account in determining the profit and loss on sale. 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 business combination in which the goodwill arose.

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

_____________________________________________________________________________________________

 

2.4          Investment in associated undertaking

Companies, other than subsidiary undertakings, in which the Group has an investment and over which it exerts significant influence but does not control, are treated as associated undertakings.

 

Investments in associated undertakings are equity accounted and carried in the Group statement of financial position at cost plus post acquisition changes in the Group's share of net assets of the associate, less any impairment in value.

 

Any goodwill arising on the acquisition of an associate, representing the excess of the cost of the investment compared to the Group's share of the net fair value of the associate's identifiable assets and liabilities, is included in the carrying amount of the associate. Goodwill on the acquisition of associates is not amortised.

 

The Group statement of profit or loss includes the Group's share of the associate's profit after tax. To the extent that losses of an associate exceed the carrying amount of the investment, the Group discontinues including its share of further losses and the investment is reported at nil value. Additional losses are only provided if the Group has an obligation to a third party.

 

After application of the equity method, the Group determines whether it is necessary to recognise an additional impairment loss of the Group's investment in its associate at each period end date. The Group calculates the amount of impairment as being the difference between the fair value of the associate and the carrying value and recognises the amount in the profit or loss.

 

Unrealised gains on transactions between the Group and its associate are eliminated to the extent of the Group's interest in the associate. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of the associate are changed where necessary to ensure consistency with the accounting policies of the Group.

 

The Parent Company's investment in its associate is included in the Company statement of financial position at cost, less any provision for impairment. 

 

2.5          Intangible assets

Intangible assets of the Group consist of computer software and are capitalised at their cost and are amortised through administrative expenses on a straight-line basis over their expected useful lives of 5 years.

 

The carrying value of intangible assets is tested for impairment whenever events or changes in circumstances indicate the carrying value may not be recoverable.

 

2.6          Property, plant and equipment

Freehold lands are stated at their revalued amounts, being the fair value at the date of revaluation, less any subsequent accumulated impairment losses. Revaluations are performed with sufficient regularity such that the carrying amounts do not differ materially from those that would be determined using fair values at the end of the reporting period. Fair value is based on periodic valuations made at least once in every five years and an interim valuation every three years. Valuations are carried out by an independent external licensed valuer on an open market value basis. Any surplus or deficit arising on valuation is transferred directly to equity as a revaluation surplus in the property revaluation reserve, except for those deficits expected to be permanent, which are charged to profit or loss. Freehold lands are not depreciated.

 

Other property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses.

 

Depreciation is calculated on a straight-line basis to write off the costs, less estimated residual values of each asset over its estimated useful lives, as follows:

 

                                Buildings                                               10 - 50 years

                                Land improvements                             5 - 20 years

Other assets                                          5 - 10 years

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

_____________________________________________________________________________________________

 

2.6          Property, plant and equipment (continued)

 

The carrying values of property, plant and equipment are tested for impairment if events or changes in circumstances indicate the carrying values may not be recoverable. Any impairment losses are recognised in the profit or loss.

 

The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each period end date. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised within the statement of profit or loss.

 

When revalued assets are sold, the amounts included in property revaluation reserves are transferred to retained earnings.

 

2.7          Biological assets

The Group's biological assets consist of oil palm tree plantations. According to IAS 41 'Agriculture', biological assets should be valued annually at their fair values. The gain or loss in fair value of biological assets is to be included in the profit or loss.

 

The Group has used IAS 41's cost model to value the biological assets because the Directors believe that fair values cannot be measured reliably as the trees on the plantations are mature (greater than 25 years old). At 31 December 2015 the costs of the biological assets have been fully depreciated. Even though the plantations are still producing income the Directors believe that any attempt to revalue the plantations to their fair values would not be reliable as market-determined prices or values are not readily available and alternative estimates of fair value are unreliable. The biological assets (i.e. the oil palm trees) are therefore carried in the Company's and Group's financial statements at a nil net book value.

 

The freehold estate land is carried at its fair value as discussed in note 2.6 above.

 

The harvested produce (fresh fruit bunches) are sold immediately after being harvested. Therefore the requirement under IAS 41 to value agricultural produce at market value as inventories does not apply.

 

2.8          Investment property

Investment property consists of investment in building that is held for long-term rental yield and/or for capital appreciation and is not occupied by the Group.

 

Investment property is stated at cost less accumulated depreciation and impairment losses. Depreciation for investment property is calculated using the straight-line method to allocate their cost over their estimated economic lives as follows:

 

                                Leasehold building                              remaining lease period

 

Where an indication of impairment exists, the carrying amount of the asset is assessed and written down immediately to its recoverable amount.

 

Gains and losses on disposal are determined by comparing the net disposal proceeds with the carrying amount and are included in the profit or loss.

 

2.9          Non-current asset held for sale

Non-current assets are classified as held for sale if their carrying amount will be recovered principally through sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset is available for immediate sale in its present condition subject only to terms that are usual and customary for sale of such asset and its sale is highly probable. Management must be committed to sale, which should be expected to qualify for recognition as a completed sale within a year from date of classification.

 

Non-current assets classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

2.10        Financial assets

The Group classifies its financial assets in the following categories: fair value through profit or loss, held-to-maturity, short term investments, loans and receivables, and available-for-sale. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition. At the end of the reporting period, the Group had all of the above except for assets with fair value through profit or loss and held-to-maturity.

 

                Held-to-maturity investments

Non-derivative financial assets with fixed or determinable payments and fixed maturity are classified as held-to-maturity when the Group has the positive intent and ability to hold the assets to maturity.  Investments intended to be held for an undefined period are not included in this classification. Other long-term investments that are intended to be held-to-maturity, such as bonds, are subsequently measured at amortised cost using the effective interest method less any impairment.  

 

Short term investments

Short term investments are investments in unquoted unit trust with licensed investment banks. After initial recognition, short term investments are measured at fair value with gains or losses being recognised in other comprehensive income and accumulated under investment revaluation reserve until the investment is derecognised or until the investment is determined to be impaired at which time the accumulate gain or loss previously reported in equity is included in the profit or loss. The fair value of the investments is measured at mark to market based on the net asset value at each reporting date.

 

                Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are measured at amortised cost using the effective interest method less any impairment and are included in current assets, except for maturities greater than twelve months after the reporting period date. These are classified as non-current assets. The Group's loans and receivables comprise "trade and other receivables" and "cash and cash equivalents" in the statement of financial position.

 

Interest income is recognised by applying the effective interest rate except for short-term receivables when the recognition of interest would be immaterial.

 

Available-for-sale financial assets

Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within twelve months after the period end date.

 

Purchases and sales of financial assets are recognised on the trade-date; the date on which the Group commits to purchase or sell the assets. Investments are initially recognised at fair value plus transaction costs. Available-for-sale financial assets are subsequently carried at fair value with gains or losses being recognised in other comprehensive income and accumulated under investment revaluation reserve until the investment is derecognised or until the investment is determined to be impaired at which time the accumulate gain or loss previously reported in equity is included in the profit or loss. The fair value of investments that are traded in active market at the end of each reporting period is determined by reference to the relevant stock exchange's quoted market bid prices at the close of business on the reporting period date.  For investments where there is no active market, fair value is determined using valuation techniques. Such techniques include using recent arm's length market transactions; reference to the current market value of another instrument, which is substantially the same; discounted cash flow analysis and option pricing models.

 

2.11        Parent Company investments in subsidiaries and associates

The Parent Company's investments in subsidiaries and associated undertakings are included in the Company statement of financial position at cost less any provisions for impairments.

 

2.12        Inventories

Inventories are being held at the lower of cost and net realisable value.

 

No harvested fresh fruit bunches are held at year end, therefore, the requirement under IAS 41 'Agriculture' to value agricultural produce at market value does not apply.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

_____________________________________________________________________________________________

 

2.13        Cash and cash equivalents

Cash and cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. For an investment to qualify as a cash equivalent it must be readily convertible to a known amount of cash and be subject an insignificant risk of changes in value. The amount in the statement of financial position is stated at cost, which is approximately equal to the fair value, and comprises cash in hand, cash at bank, short term deposits and short term investments.

 

2.14        Impairment of non-current assets

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the asset's recoverable amount. An asset's recoverable amount is the higher of an asset's or cash-generating unit's fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value of money and the risks specific to the asset. Impairment losses of continuing operations are recognised in the profit or loss in those expense categories consistent with the function of the impaired asset.

 

2.15                        Financial liabilities and equity

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. Financial liabilities include trade and other payables and bank borrowings.

 

Trade and other payables are carried at cost which is the fair value of the consideration to be paid in the future for goods and services received, whether or not billed to the company.

 

All borrowings and overdrafts are recorded at the amount of the proceeds received, net of direct issue costs. Finance charges are charged to the statement of profit or loss on an accruals basis using the effective interest rate method.

 

                Equity instruments are recorded at the fair value of the consideration received, net of direct issue costs

 

2.16        Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured at the fair value of consideration received or receivable net of value added tax, returns, rebates or discounts and after eliminating sales with the Group.

 

Revenue derived from plantation activities represents the sale of oil palm fresh fruit bunches and is recognised on the accruals basis.

 

Revenue derived at manufacturing activities is recognised from sales when the goods are delivered, and the risks and rewards of ownership of the goods are transferred to buyers.

 

Revenue derived from resort activities represents room rentals, net of hotel room tax, and the sale of food and beverages. Accommodation revenue is recognised on the arrival of customers. Payments received in advance of the arrival of guests are included in current liabilities as accommodation rental received in advance.

 

Dividend income is recognised when the right to receive payments is established.

 

Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Group and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset's net carrying amount on initial recognition.

 

The Group's policy for recognition of revenue from operating leases is described in note 2.17 below.

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

_____________________________________________________________________________________________

 

2.17        Leases

                                Leases where the lessor retains substantially all the risks and benefits of ownership of the asset are classified as operating leases.

 

                                The Group as lessor

                                Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging as operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.

 

The Group as lessee

Operating lease payments are recognised as an expense on a straight line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.

               

2.18        Employee entitlements

                                The liability for employees' compensation for unutilised leave is accrued in relation to services rendered by employees and relates to rights which have been vested. These amounts are not discounted.

 

                                The Group's contribution to a defined contribution plan is charged to the profit or loss in the period to which the contribution relates.

 

2.19        Provisions

                                Provisions are recognised when the Group has a legal or constructive obligation as a result of a past event and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material, expected future cash flows are discounted using a current pre-tax rate that reflects, where appropriate, the risks specific to the liability.

 

                Where the Group expects some or all of a provision to be reimbursed, for example under an insurance policy, the reimbursement is recognised as a separate asset but only when recovery is virtually certain. The expense relating to any provision is presented in the income statement net of any reimbursement. Where discounting is used, the increase in the provision due to unwinding of discount is recognised as a finance cost.

 

2.20        Dividend distributions

                                Dividend distributions proposed by the Board of Directors and unpaid at the year end are not recognised in the financial statements as a liability until they have been approved by the Company's shareholders at the AGM.

 

2.21        Related parties

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party, or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or common significant influence. Related parties may be individuals or corporate entities.

 

2.22        Current and deferred income tax

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the period end date and any adjustments to tax payable in respect of previous years.

 

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the period end date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax liabilities are recognised for the temporary timing differences associated with subsidiaries, joint ventures and associates, but only where the Group is able to control the timing of the reversal of the temporary difference.

 

Deferred income tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the assets can be utilised.

 



NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

2.22        Current and deferred income tax (continued)

 

The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the Group expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities. For this purpose, the carrying amount of freehold lands measured at fair value is presumed to be recovered through sale after implementation of the Group business plan.

 

2.23        Foreign currency translation

                             

Functional and presentational currency

Items included in the financial statements of each of the Group's entities are measured using the currency of the primary economic environment in which the entity operates ('the functional currency'). The consolidated financial statements are presented in 'Ringgit Malaysia' ('RM'), which is the Company's and the Group's functional and presentation currency.

 

                Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the profit or loss.

 

The assets, liabilities and the results of the foreign subsidiary undertakings are translated into Ringgit Malaysia at the rates of exchange ruling at the year end.  Exchange differences resulting from the retranslation of net investments in subsidiary undertakings are treated as movements on reserves.

 

3.            Significant accounting judgements and estimates

 

In the process of applying the Group's accounting policies, which are described in note 2 above, the Directors have made the following judgments and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom exactly equal the related actual results. The estimates and assumptions that have a risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below:

 

Carrying value of associate

The directors assess the fair value of the Group's investment in its associated undertaking, Concrete Engineering Products Berhad ("Cepco") is more than the carrying value. No impairment or reversal of impairment was recommended. The assessment was made by reference to the value-in-use of the associate to the Group.

 

The value-in-use calculation includes a discounted cash flow assessment model; the primary assumptions underlying the model were:

Sales growth rate                                                                                                 4.50%

Terminal value equal to Price Earnings ratio                                   12

Additional assumptions utilised include:

Duration of assessment period                                                          5 years

Discount rate of                                                                                   7%

 

Depreciation, useful lives and residual values of property, plant & equipment

The Directors estimate the useful lives and residual values of property, plant & equipment in order to calculate the depreciation charges. Changes in these estimates could result in changes being required to the annual depreciation charges in the statement of profit or loss and the carrying values of the property, plant and equipment in the statement of financial position.

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

3.            Significant accounting judgements and estimates (continued)

 

Fair value measurements

A number of the group's accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities.

The group has an established control framework with respect to the measurement of fair values. When measuring the fair value of an asset or a liability, the management uses market observable data as far possible. Where Level 1 inputs are not available, the Group engages third party qualified valuers to perform the valuation. Information about the valuation techniques and inputs used in determining the fair value of various assets and liabilities are included in the relevant notes.

 

Deferred tax asset

Deferred tax assets are recognised for all unutilised tax losses to the extent that it is probable that taxable profit will be available against which the losses can be utilised. Significant judgment and measurement is required to determine the amount of deferred tax asset that can be recognised, based on the likely timing of future taxable profit together with future tax planning strategies. The carrying value of deferred tax assets recognised as at 31 December 2015 is RM Nil (2014: RM Nil) and the unrecognised tax losses as at 31 December 2015 is approximate RM7.0 million (2014: RM4.3 million) in respect of which the future economic benefit is uncertain. Further details are shown in note 8. 

 

4.            Segmental information

 

The Group applies IFRS 8 'Operating Segments'. The accounting policy for identifying segments is based on internal management reporting information that is regularly reviewed by the chief operating decision maker. In identifying its operating segments, management generally follows the Group's service lines, which represent the main products and services provided by the Group.

 

The Group's operating businesses are organised and managed separately according to the nature of products produced and services provided, with each segment representing a strategic business unit that offers different products and serves different markets.

 

At 31 December 2015, the Group was organised into four operating segments as follows:

 

·       Plantations - sale of fresh fruit bunches;

·       Manufacturing - producing constant viscosity (CV) rubber blocks;

·       Tourism - operation of two tourist resorts, sale of rooms and sale of food and beverages;

·       Others being:

i)    Property development and leasing - development and sale of land and properties and leasing of buildings;

ii)    Trading - trading of building materials; and

iii)   Investment - holding of equity interests in quoted shares.

 



NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

4.            Segmental information (continued)

 

  The segment results for the year ended 31 December 2015 are as follows:

 

 

Plantation

Tourism

Manufacturing

Others

Total

 

RM'000

RM'000

RM'000

RM'000

RM'000

Revenue

 

 

 

 

 

From external customers

376

6,744

3,016

153

10,289

 

Segment revenues

 

376

 

6,744

 

3,016

 

153

 

10,289

 

 

 

 

 

 

Finance income

-

92

-

4,462

4,554

Other gains and losses

-

61

-

81

142

Share of profit of Cepco

-

-

-

4,598

4,598

Depreciation and amortisation

(30)

(1,188)

(468)

(91)

(1,777)

Provision for diminution in value of stocks

 

-

 

-

 

(81)

 

-

 

(81)

Tax expenses

-

(7)

-

(36)

(43)

Other expenses (net of other income)

(305)

(7,040)

(3,947)

(8,331)

(19,623)

Segment profit/(loss)

41

(1,338)

(1,480)

836

(1,941)

 

 

 

 

 

 

Segment assets

133,514

2,015

3,301

581,104

719,934

 

 

 

 

 

 

Segment liabilities

1,238

2,223

100

78,064

81,625

 

 

 

 

 

 

Other disclosures

 

 

 

 

 

Investment in Cepco

-

-

-

24,740

24,740

Capital expenditure

     Tangible

     Assets under construction

     Intangible

 

35

3,675

28

 

 

 

 

1,804

-

-

 

 

 

36

-

3

 

 

 

96

-

-

 

 

 

1,971

3,675

31

 

 

 

Segment revenue reported above represents revenue generated from external customers. Inter-segment sales within the Group amounted to approximate RM2.27 million (2014: RM11.5 million).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

4.             Segmental information (continued)

 

                The segmented results for the year ended 31 December 2014 are as follows:

 


Plantation

Tourism

Manufacturing

Others

Total

 


RM'000

RM'000

RM'000

RM'000

RM'000

 

Revenue




 

 

 

From external customers

696

8,396

14,385

162

23,639

 

 

Segment revenues

 

696

 

8,396

 

14,385

 

162

 

23,639

 


 

 

 

 

 

 

Finance income

-

183

-

4,576

4,759

Other gains and losses

-

(1)

12

413

424

Fixed assets written off

-

(123)

-

(12)

(135)

Share of loss of Cepco

-

-

-

(1,170)

(1,170)

Depreciation and amortisation

(32)

(1,101)

(149)

(374)

(1,656)

Provision for diminution in value of stocks

 

-

 

-

 

(925)

 

-

 

(925)

Impairment of Cepco

-

-

-

(4,500)

(4,500)

Tax expenses

-

(100)

-

(39)

(139)

Other expenses (net of other income)

(446)

(7,404)

(16,084)

(3,490)

(27,424)

Segment profit/(loss)

218

(150)

(2,761)

(4,434)

(7,127)

 

 

 

 

 

 

Segment assets

114,429

24,990

19,075

548,127

706,621

 

 

 

 

 

 

Segment liabilities (restated)

997

1,445

101

73,127

75,670

 

Other disclosures

 

 

 

 

 

 

 

Investment in Cepco

-

-

-

20,142

20,142

 

Capital expenditure

     Tangible

     Assets under construction

     Intangible

 

22

1,054

9

 

 

 

 

692

-

-

 

 

 

32

-

-

 

 

 

1,237

-

-

 

 

 

1,983

1,054

9

 

 

Geographic information

 

The Group operates in two principal geographical areas - Malaysia and Thailand.

 

The Group's revenue from continuing operations from external customers by location of operations and information about its non-current assets* by location of assets are detailed below.

 

 


Revenue from external customers


Non-current assets


2015

2014


2015

2014


RM'000

RM'000

 

RM'000

RM'000







Malaysia

7,950

13,281


460,285

439,221

Thailand

2,339

10,358


2,202

2,583





 

 


10,289

23,639


462,487

441,804


*non-current assets for this purpose consist of property, plant and equipment, investment property and intangible assets.

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

4.         Segmental information (continued)

 

Information about major customers

 

Included in revenues arising from manufacturing are revenues of approximately RM1.2 million (2014: RM2.7 million) which arose from sales to the Group's largest customer. No other single customers contributed 10% or more to the Group's revenue for both 2015 and 2014.

 

5.         Other income and other gains and losses

 

 

 

 

 

 

 

Group

 

Company

 

 

2015

2014

 

2015

2014

 

 

RM'000

RM'000

 

RM'000

RM'000

Other income

 

 

 

 

 

 

Interest received *

 

-

3,523

 

-

3,523

Rebates from investment in unit trust

 

379

373

 

379

373

Sundry income

 

61

43

 

28

31

Rental income from investment property

 

12

12

 

-

-

Other rental income

 

195

195

 

-

-

Management fee to subsidiary

 

-

-

 

300

300

Gain on foreign exchange

 

(29)

1,122

 

(8)

-

Insurance claim

 

-

7

 

-

-

Compensation received

 

-

175

 

-

175

 

 

 

 

 

 

 

 

 

618

5,450

 

699

4,402

 

 

 

 

 

 

 

  * Interest received for late settlement by government on compulsory acquisition of the Company's land.

 

 

Other gains and losses

Gain on sale of assets

 

51

12

 

-

-

(Loss)/gain on sale of investment

 

(98)

7

 

(87)

7

Cumulative gain reclassified from equity on redemption of short term investment

 

 

189

 

405

 

 

167

 

406

 

 

 

 

 

 

 

 

 

142

424

 

80

413

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

__________________________________________________________________________________________________

 

6.         Operating loss



Group


Company



2015

2014


2015

2014



RM'000

RM'000


RM'000

RM'000

The operating loss is stated after charging/(crediting):







Auditors' remuneration:

      - Parent Company auditor

      - Subsidiaries' auditor


 

200

146

 

200

93


 

200

-

 

200

-

Depreciation


1,761

1,648


16

24

Amortisation of intangible assets


16

8


14

7

Operating leases


665

565


350

360

Staff costs (note 10)


6,798

6,211


3,712

3,129

Bad debts written off


-

13


-

-

Loss/(gain) on foreign exchange


29

(1,112)


8

-

Provision for contingent liability


-

(64)


-

(64)

Fixed assets written off


-

135


-

12

Loss from diminution in value of stocks


81

925


-

-

 

The non-audit fees paid to the Company's external auditors amounted to RM3,457 for the financial year 2015 (2014: RM28,240).

 

Direct operating expenses from investment property that generated rental income for the Group during the financial year amounted to RM2,533 (2014: RM2,517).

 

 

7.            Finance income and costs



Group


Company



2015

2014


2015

2014



RM'000

RM'000


RM'000

RM'000

Finance income







Short term deposits


825

798


823

786

Short term investments


3,729

3,961


3,639

3,790



 

 


 

 






 

 



4,554

4,759


4,462

4,576

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

_____________________________________________________________________________________________

 

8.             Taxation

 

8.1          Income taxes recognised in profit and loss

 

The tax charge is made up as follows:



Group


Company



2015

2014


2015

2014



RM'000

RM'000


RM'000

RM'000

In Malaysia







- Current taxation


41

180


-

-

- Under/(over) provision in respect of prior years


 

2

 

(41)


 

-

 

-










43

139


-

-

 

Other than the subsidiary in Thailand which is a tax resident there, the Company and the Group are tax residents in Malaysia. The Group is liable to corporation tax in Malaysia and Thailand but is not subject to United Kingdom corporation tax. The Group's effective tax rate differs from the standard rate of corporation tax in Malaysia of 25% (2014: 25%) as follows:



Group


Company



2015

2014


2015

2014



RM'000

RM'000


RM'000

RM'000








Loss before taxation


(1,898)

(6,988)


(2,903)

(2,275)

 








Tax credit at standard corporation tax rate in Malaysia of 25% (2014: 25%)


(474)

(1,747)


(726)

(569)








Tax effects of:







Expenses not deductible for tax purposes


1,545

2,219


435

1,556

Income not subject to tax


(188)

(1,464)


(20)

(1,061)

Utilisation of business losses


(8)

798


-

-

Temporary timing differences not recognised


 

(834)

 

374


 

311

 

74

Under/(over) provision in respect of prior years


 

2

 

(41)


 

-

 

-








Total tax charge for year


43

139


-

-

 

8.2          Income taxes recognised in other comprehensive income

 

The tax charge relating to components of other comprehensive income is as follows:

 



Group


Company



2015

2014


2015

2014



RM'000

RM'000


RM'000

RM'000




restated




Fair value gain on freehold land







Before tax


16,742

1,000


5,000

-

Tax charge


(4,185)

(250)


(1,250)

-

After tax


 

12,557

 

750


 

3,750

 

-








Other comprehensive income


12,557

750


3,750

-








Deferred tax liabilities


4,185

250


1,250

-



NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

_____________________________________________________________________________________________

 

8.             Taxation (continued)

 

8.3          Deferred tax balances

 

The estimated deferred tax assets at 25% (2014: 25%) not recognised in these financial statements are as follows:

 



Group


Company



2015

2014


2015

2014



RM'000

RM'000


RM'000

RM'000








Arising from:







Unused tax losses


7,033

4,259


5,744

3,965

Unutilised capital allowances


494

132


49

46










7,527

4,391


5,793

4,011

 

The key factors that may affect future tax charges include the ability to claim capital allowances in excess of depreciation, utilisation of unrelieved tax losses and changes in tax legislation. The Group expects to be able to claim capital allowances in excess of depreciation in future years based on its capital investment plans. The Group also has unutilised tax losses estimated to be RM28 million,(2014: RM17 million ) which arise mainly in relation to activities in Malaysia and which may generally be carried forward without time limits applying. The availability of the unused tax losses for offsetting against future taxable profits of the Company and its subsidiaries are subject to there being no substantial changes in shareholdings of the Company and its subsidiaries under Section 44 (5A) & (5B) of Income Tax Act, 1967 in Malaysia.

 

As for the subsidiary in Thailand, the unutilised tax losses is estimated to be THB64.7 million (approximate RM7.7 million) (2014: THB70.0 million (approximate RM7.4 million)) which may be carried forward for a maximum of five (5) years.

 

The revaluation of available-for-sale investments and short term investments that has been reported as part of other comprehensive income on page 39 of these financial statements is not shown net of taxation. This is on the basis that the Group and the Company have unutilised losses which exceed the revalued amount. Unused tax losses carried forward at the end of reporting period, which is disclosed above, have been reduced correspondingly.

 

As disclosed in note 12, freehold lands have been revalued, and a revaluation surplus arises. Deferred tax has been provided in respect of the revaluation surplus where the carrying amount of freehold lands is presumed to be recovered through sale after implementation of the Group business plan.

 

The analysis of deferred tax liabilities is as follows:


Group


Company


2015

2014


2015

2014


RM'000

RM'000


RM'000

RM'000



restated










Deferred tax liabilities due more than 12 months

76,028

71,843


22,900

21,650

Deferred tax liabilities due within 12 months

-

-


-

-


 

76,028

 

71,843


 

22,900

 

21,650

 



NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

_____________________________________________________________________________________________

 

8.3          Deferred tax balances (continued)

 

The movement in deferred tax liabilities during the year, without taking consideration the offsetting of balances within same jurisdiction, is as follow:

 


Group


Company


2015

2014


2015

2014


RM'000

RM'000


RM'000

RM'000



restated



restated







At 1 January

71,843

71,593


21,650

21,650

Charge to other comprehensive income

4,185

250


1,250

-

 

At 31 December

 

76,028

 

71,843


 

22,900

 

21,650

 

9.            Loss per share

 

The calculation of loss per share is based on the Group's loss for the year and the weighted average number of shares in issue after adjusting for movement in treasury shares during the financial year. There are no potential dilutive shares or share options outstanding and therefore, the diluted loss per share is the same as basic loss per share.

 

 

 

 

 

 

 

 

 

 

 

2015

 

2014

Net loss attributable to the owners of the Company (RM'000)

 

(1,941)

 

(7,127)

 

 

 

 

 

 

 

 

Weighted average number of ordinary shares in issue after adjusting for movement in treasury shares [Number of shares ('000)]

 

403,209

 

403,209

 

 

 

 

 

 

 

 

Basic and diluted loss per share (Sen)

 

(0.48)

 

(1.77)

 

 

10.          Employee information



Group


Company



2015

2014


2015

2014



RM'000

RM'000


RM'000

RM'000

Staff costs comprises:














Wages and salaries


6,406

5,819


3,558

2,975

Contribution to a statutory







     employees' provident fund


392

392


154

154










6,798

6,211


3,712

3,129

 

The increase of Group wages and salaries in 2015 is due to an upward salary adjustment and bonus payment.

 

The statutory employees' provident fund is a defined contribution scheme funded by a government body in Malaysia.



NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

________________________________________________________________________________________

 

10.          Employee information (continued)

 

                The average monthly number of employees employed by the Group during the year was as follows:

 



Group


Company



2015

2014


2015

2014



Number

Number


Number

Number








Plantation


20

20


20

20

Tourism


121

130


-

-

Manufacturing


32

36


-

-

Property development and leasing


5

4


-

-

Investment


2

2


2

2



180

192


22

22

 

 

11.          Directors' emoluments



Group


Company



2015

2014


2015

2014



RM'000

RM'000


RM'000

RM'000








Directors' fees & allowances


190

193


190

193

 








Highest paid Director


46

46


46

46

 

 

                The above emoluments are made up as follows:

 

 

Basic

 

 

 

 

 

Salary &

 

Meeting

Total

Total

 

Fees

 

Allowances

2015

2014

 

(RM)

 

(RM)

(RM)

(RM)

 

 

 

 

 

 

Non-Executive Directors

 

 

 

 

 

Dato' Adnan bin Maaruf

40,000

 

6,000

46,000

46,000

Datuk Kamaruddin bin Awang

30,000

 

8,250

38,250

38,250

Dato' Haji Muda bin Mohamed

30,000

 

7,000

37,000

37,000

Dato' Tik bin Mustaffa

30,000

 

5,750

35,750

37,000

Dr. Radzuan bin A. Rahman

30,000

 

3,000

33,000

34,500

 

 

 

 

 

 

 

160,000

 

30,000

190,000

192,750

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

________________________________________________________________________________________

 

12.          Property, plant and equipment

 

Group

 

Freehold lands

 

Prepaid land and land  improvements

 

Buildings

 

Assets

under

construction

 

Others

 

Total


RM'000

RM'000

RM'000

RM'000

RM'000

RM'000

Cost or valuation







At 1 January 2014

430,879

3,565

50,749

-

12,130

497,323

Additions

958

-

178

1,054

847

3,037

Revaluations

1,000

-

-

-

-

1,000

Transfer to assets held for

    sale (note 19)

-

 

-

(31,034)

 

-

(522)

(31,556)

Transfer to investment 

    property (note 13)

-

 

-

(100)

 

-

-

(100)

Disposals

-

-

-

-

(3,870)

(3,870)

Exchange differences

15

25

128

-

190

358







At 1 January 2015

432,852

3,590

19,921

1,054

8,775

466,192

Additions

-

-

1,342

3,675

629

5,646

Revaluations

16,742

-

-

-

-

16,742

Disposals

-

 

-

-

(10)

(10)

Exchange differences

29

49

255

-

378

711


 

 

 

 

 

At 31 December 2015

449,623

3,639

21,518

           4,729

9,772

489,281


 

 

 

 

 

Accumulated depreciation

 

 

 

 

 

At 1 January 2014

-

1,054

17,074

-

10,037

28,165

Charge for the year

-

51

981

-

616

1,648

Transfer to assets held for

    sale (note 19)

 

-

-

(1,840)

 

-

(62)

(1,902)

Transfer to investment 

    property (note 13)

 

-

-

(28)

 

-

-

(28)

On disposals

-

-

-

-

(3,735)

(3,735)

Exchange differences

-

24

124

-

184

332


 

 

 

 

 

 

At 1 January 2015

-

1,129

16,311

-

7,040

24,480

Charge for the year

-

39

1,080

-

641

1,760

On disposals

-

-

-

-

(3)

(3)

Exchange differences

-

48

248

-

367

663


 

 

 

 

 

At 31 December 2015

-

1,216

17,639

-

8,045

26,900


 

 

 

 

 

Carrying amount 

At 31 December 2015

449,623

 

2,423

3,879

 

4,729

1,727

462,381


 

 

 

 

 

 

At 31 December 2014

432,852

2,461

3,610

1,054

1,735

441,712


 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

___________________________________________________________________________________________

 

12.       Property, plant and equipment (continued)

 

Fair value measurement of the Group's and Company's freehold lands

 

The Group's freehold lands are stated at their revalued amounts, being the fair value at the date of revaluation. In order to establish the 31 December 2015 valuation of the Group's freehold lands, valuations were obtained.

 

The fair value measurement of the Group's freehold lands in Kajang and Bangi as at 31 December 2015 and 31 December 2014 were performed by Nilai Properties Consultants Sdn Bhd (V(1) 0065), an independent valuer not related to the Group, using the open market basis method. These lands are currently being used for the Group's plantation activities for growing of oil palm fresh fruit bunches. The Group has been given consent for the change of use of the lands. Further commentary on the Group's plans for its land is included in the Chairman's Statement.

 

In the opinion of the Directors, there is no indication of any significant difference between the carrying amount and market values of the other freehold lands of the Group at 31 December 2015.

 

The historical cost of the above freehold lands of the Group is RM107.242 million and of the Company is RM0.407 million. There are no restrictions on the title of the Group's property, plant and equipment.

 

The fair values of all the freehold lands of the Group and Company are classified as Level 2. There were no transfers between Levels 1 and 2 during the year.

 

Assets under construction

 

This represents 22 units of low cost terrace houses under construction at Dunedin estate, Mukim of Semenyih. The total contract sum is approximate RM4 million. The construction is almost completed pending the issuance of separate title which is expected to be obtained in second half of year 2016.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

___________________________________________________________________________________________

 

12.          Property, plant and equipment (continued)

 

Company

Freehold lands

Buildings

Assets under construction

Others

Total

 

RM'000

RM'000

RM'000

RM'000

RM'000

Cost or valuation

 

 

 

 

 

At 1 January 2014

110,000

477

-

920

111,397

Additions

-

-

1,054

22

1,076

Disposals

-

-

-

(536)

(536)

 

 

 

 

 

 

At 1 January 2015

110,000

477

1,054

406

111,937

Additions

-

-

3,675

35

3,710

Revaluations

5,000

-

-

-

5,000

 

At 31 December 2015

 

115,000

 

477

 

4,729

 

441

 

120,647

 

 

 

 

 

 

Accumulated depreciation

 

 

 

 

 

At 1 January 2014

-

477

-

879

1,356

Charge for the year

On disposals

-

-

-

-

-

-

24

(523)

24

(523)

 

 

 

 

 

 

At 1 January 2015

-

477

-

380

857

Charge for the year

-

-

-

16

16           

 

 

 

 

 

 

At 31 December 2015

-

477

-

396

873

 

 

 

 

 

 

Carrying amount






At 31 December 2015

115,000

-

4,729

45

119,774

 

 

 

 

 

 

At 31 December 2014

110,000

-

1,054

26

111,080

 

 

     

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

____________________________________________________________________________________________

 

13.          Investment Property

 

Group

 

31 December 2015

31 December 2014

 

 

 

RM'000

RM'000

 

Cost

 

 

 

 

At 1 January

 

100

-

 

Transfer from property, plant & equipment

 

-

100

 

 

At 31 December

 

 

100

 

100

 

 

 

 

 

 

Accumulated depreciation

 

 

 

 

At 1 January

 

28

-

 

Charge for the year

 

1

-

 

Transfer from property, plant & equipment

 

-

28

 

 

 

 

 

 

At 31 December

 

29

28

 

 

 

 

 

 

Carrying amount





At 31 December

 

71

72

 

 

 

Included in investment property is apartment at Amber Tower Seri Mas Condominium, Cheras, Kuala Lumpur.

 

The investment property is valued at cost less accumulated depreciation. The fair value of the investment property is estimated at RM0.3 million.

 

14.       Intangible assets    

 

             Computer software and corporate website creation

 



Group


Company



2015

2014


2015

2014



RM'000

RM'000


RM'000

RM'000








Cost





 

 

At 1 January


75

68


71

64

Additions


31

9


28

9

Disposals


-

(2)


-

(2)

 

At 31 December


 

106

 

75


 

99

 

71






 

 

Accumulated amortisation





 

 

At 1 January


55

49


53

48

Amortisation for the year


16

8


14

7

On disposals


-

(2)


-

(2)

 

At 31 December


 

71

 

55


 

67

 

53






 

 

Carrying amount





 

 

At 31 December


35

20


32

18

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

____________________________________________________________________________________________

 

15.          Investments in subsidiaries


Company


2015


2014


RM'000


RM'000

Cost




Shares in subsidiary undertakings

6,338


6,338

Provision for impairment loss on investment in subsidiary

(5,338)


(5,338)

Loans to subsidiary undertakings

243,044


237,085

Allowance for doubtful debts

(6,969)


(6,969)






237,075


231,116

       

The loans to subsidiary undertakings are interest free and have no fixed repayment terms. 

 

The subsidiaries of the Group are as follows:

 

Name of company

Country of

incorporation

Nature of business

Type of

holding

Percentage of share capital held





2015

2014





%

%

Inch Kenneth Hotels & Resorts (M) Sdn Bhd

Malaysia

Investment holding

Ordinary shares

100

100







Perhentian Island Resort Sdn Bhd #

Malaysia

Operation of tourist resort

Ordinary shares

100

100







Inch Kenneth Development (M) Sdn Bhd

Malaysia

Property development and leasing

Ordinary shares

100

100







Inch Kenneth Trading (M) Sdn Bhd #

Malaysia

 Dormant

Ordinary shares

100

100







IKK Property (M) Sdn Bhd#

Malaysia

 Dormant

Ordinary shares

100

100







Inch Kenneth Plantations (M) Sdn Bhd

Malaysia

Dormant

Ordinary shares

100

100







Inch Kenneth Sea Sports Adventure (M) Sdn Bhd #

Malaysia

Dormant

Ordinary shares

100

100







IKK Rubber International (M) Sdn Bhd

Malaysia

Trading of rubber blocks

Ordinary Shares

100

100

 







 

Supara Company Limited #

Thailand

Manufacturing of rubber blocks

Ordinary Shares

100

100

 







 

Motel Desa Sdn Bhd #

Malaysia

Operation of a motel

Ordinary shares

100

100

 







 

Inch Kenneth Tours (M) Sdn Bhd #

Malaysia

Dormant

Ordinary shares

100

100

 

               

        # These subsidiaries are held indirectly by the Company.

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

________________________________________________________________________________________

 

16.          Investment in associated undertaking

 

                Group

 

The Group's investment in its associated undertaking represents a 22.40% (2014: 22.40%) interest in Concrete Engineering Products Berhad ("Cepco"), a public company incorporated in Malaysia. The principal activity of Cepco is the manufacture and distribution of prestressed spun concrete piles and poles. The Group's investment in Cepco is accounted for under the equity accounting method as follows:

 

2015

2014

 

RM'000

RM'000

Shares

 

 

 

 

 

At 1 January and 31 December

40,914

40,914

 

 

 

Share of retained profits

 

 

At 1 January

10,843

12,013

Share of profit /(loss)

4,598

(1,170)

 

 

 

At 31 December

15,441

10,843

 

 

 

Share of dividend

 

 

At 1 January

(1,104)

(1,104)

Share of dividend

-

-

 

 

 

At 31 December

(1,104)

(1,104)

 

 

 

Accumulated impairment

 

 

At 1 January

(30,511)

(26,011)

Impairment charge

-

(4,500)

 

 

 

At 31 December

(30,511)

(30,511)

 

 

 

Carrying amount

24,740

20,142

 

 

 

 

 

The Group's share of the net assets of Cepco is as follow:

2015

2014

 

RM'000

RM'000

Share of assets

 

 

Share of non-current assets

19,290

19,917

Share of current assets

31,243

21,195

 

 

 

 

50,533

41,112

 

 

 

Share of liabilities

 

 

Share of non-current liabilities

(2,338)

(2,122)

Share of current liabilities

(21,948)

(17,341)

 

 

 

 

(24,286)

(19,463)

 

 

 

Share of net assets

26,247

21,649

Goodwill (net of impairment) arising on the acquisition of Cepco

(1,507)

(1,507)

 

Carrying value of Cepco

 

24,740

 

20,142

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

________________________________________________________________________________________

 

16.          Investment in associated undertaking (continued)

 

Group (continued)

 

The Group's share of the results of Cepco is as follow:

 

 

2015

2014

 

RM'000

RM'000

 

 

 

Share of revenue

52,186

37,616

 

 

 

Share of operating profit/(loss)

5,622

(286)

Share of finance costs

(712)

(641)

Share of taxation

(312)

(243)

 

 

 

Share of profit/(loss) which included in Group statement of profit or loss

4,598

(1,170)

 

Cepco's shares are quoted on the Bursa Securities and the market value of the Group's investment in Cepco at the end of reporting period was RM18.256 million (2014: RM18.056 million).

 

The financial year end for Cepco is 31 August while for the Group it is 31 December. In order to equity account for the associate as at 31 December the result from 1 September to 31 December is added to the results for the year ended 31 August 2015 while the results for the period in the prior year are deducted. Accordingly the accounting period used to equity account for Cepco is the same as the financial year for the Group.

 

                Company

 

The movement in the Company's investment in Cepco is as follows:


2015

2014


RM'000

RM'000

Cost



At 1 January and 31 December

40,236

40,236

 

Accumulated impairment



At 1 January

22,090

17,590

Impairment  charge

-

4,500

 

 

 

22,090

 

22,090




Carrying amount

18,146

18,146

 

17.          Available-for-sale investments


Group

Company


2015

RM'000

2014

RM'000

2015

RM'000

2014

RM'000






Quoted shares:





At 1 January

57

61

20

19

Disposal of investments

-

(18)

-

(18)

Fair value adjustments

27

14

(7)

19






At 31 December

84

57

13

20

 

 

 

 

 

 

 

 

 

 

 

 

The above available-for-sale investments are stated at their fair values. The historical cost of the above investments of the Group is RM182,000 and of the Company is RM92,000.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

________________________________________________________________________________________

 

18.          Goodwill

 

                 Group


2015

 

  2014

 

RM'000

 

  RM'000

At cost

 

 

 

At 1 January and 31 December

4,573

 

4,573

 

 

Accumulated impairment

At 1 January and 31 December

(4,502)

 

(4,502)

 

Carrying amount

71

 

71

 

                The Group has tested goodwill for impairment in accordance with IAS 36. No provision for impairment has been recommended for the financial year ended 31 December 2015.

 

19.          Assets held for sale

 

In December 2015, the Group's properties held under assets held for sale (a leasehold property with Lot No. 27327 and a freehold property with Lot No. 46010, both under Mukim Kuala Lumpur) were agreed to be part of the settlement of the leasehold industrial land acquired by the Group (see Note 21). The transfers were made at book value which is approximate the fair value of the assets.

 

 

20.          Inventories           


Group

Company


2015

2014

2015

2014


RM'000

RM'000

RM'000

RM'000






Resort stores

62

57

-

-

Rubber blocks

1,493

3,353

-

-







1,555

3,410

-

-

 

 

 

 

 

 

 

 

 

No harvested fresh fruit bunches are shown as inventory at the year end because they are all sold immediately after being harvested.

 

The amount stated at the estate and the resort is within the normal inventories level.

 

The cost of rubber block recognised as an expense include RM0.08 million (2014: RM0.925 million) in respect of write down of rubber block to net realisable value.

 

21.       Trade and other receivables


Group

Company


2015

RM'000

2014

RM'000

2015

RM'000

2014

RM'000






Trade receivables

381

220

10

9

Other receivables and prepayments

92,409

42,776

259

109

Corporation tax recoverable

1,030

1,030

1,030

1,030







93,820

44,026

1,299

1,148

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

________________________________________________________________________________________

 

21.       Trade and other receivables (continued)

 

Included in other receivables is an amount of approximate RM11.3 million (2014: RM8.19 million) as deposit for the proposed acquisition of land and building paid to a company where a key management personnel of the Group is a Director.

 

Also included in other receivables an amount of RM6.9 million (2014: RM5.9 million) related to consideration paid for land acquired in which the title has yet to be transferred to the Group.

 

On 21 December, as part of a settlement agreement signed, the Group acquired a leasehold industrial land with an area approximate 8.75 acres (Plot 64006 of Parent Lot PT 16708) in Mukim Petaling for the cost of approximate RM72 million included in other receivables above. This transaction is expected to be completed in second half of 2016.

 

At 31 December 2015 the trade and other receivables balances are mainly incurred during the normal course of business. The receivables outside their payment terms yet not provided for are as follows:

 

Within credit terms

87,747

15,679

10

9

Outside credit terms but not impaired:



 

 

 0-1 month

27

57

10

19

 1-2 months

-

-

-

-

 More than 2 months

5,016

27,260

249

90


92,790

42,996

269

118

 

 

 

 

 

 

 

 

The directors are of the opinion that the receivables, both within and outside the credit terms, are creditworthy and there should be no issues on its recoverability.

 

22.       Short term investments


Group

Company


2015

RM'000

2014

RM'000

2015

RM'000

2014

RM'000






Investments on unit trusts with:

 





Licensed investment banks

110,422

123,719

107,940

119,263

 

 

 

 

 

 

 

 

 

Unquoted unit trusts are measured at mark to market based on the net asset value at each reporting date. The time weighted rate of return of these investments at the reporting date were between 1.76% and 3.47% (2014: 2.50% to 3.41%).

 

23.       Cash and cash equivalents


Group

Company


2015

2014

2015

2014


RM'000

RM'000

RM'000

RM'000






Cash at bank

2,763

14,053

558

1,161

Cash in hand

66

56

1

2

Deposits with licensed banks

22,683

27,704

22,640

26,917

Investments with licensed banks

1,243

1,925

1,076

1,763


26,755

43,738

24,275

29,843

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

___________________________________________________________________________________________

 

23.          Cash and cash equivalents (continued)

 

The effective interest rates of deposits at the reporting date were between 2.64% and 4.08% (2014: 1.5% to 3.25%). Included in deposits with licensed banks is the short term deposits totalling to RM27,588 (2014: RM24,278) which was pledged with commercial banks as collateral for issuing letters of guarantee.

 

The investments with licensed banks are qualified as a cash equivalent as they are readily convertible to a known amount of cash with an insignificant risk of changes in value.

 

24.          Share capital

 

Group and Company



2015


2014


GBP'000


GBP'000

Authorised




1,000,000,000 ordinary shares of 10p each

100,000


100,000

 


2015

2014

2015

2014


RM'000

RM'000

GBP'000

GBP'000

Allotted, called up and fully paid 420,750,000 ordinary shares of 10p each

 

287,343

 

287,343

 

42,075

 

42,075

 

No ordinary shares were allotted during the year and the Company does not have any share options or share warrants in issue at 31 December 2015.

 

25.          Treasury shares

     

 Group and Company        

 

 

 

 

 

 

2015

2014

 

 

Number of shares

Amount

Number of shares

Amount

 

 

 

RM

 

RM

 

 

 

 

 

 

At 1 January and 31 December

 

17,540,800

15,979,529

17,540,800

15,979,529

 

The shareholders of the Company approved an ordinary resolution at the One Hundred and Fifth AGM held on 16 June 2015 for the Company to repurchase its own shares up to a maximum of 10% of the issued and paid-up capital of the Company ("Share Buy Back"). The Directors of the Company are committed to enhancing the value of the Company and believe that the purchase plan is being implemented in the best interest of the Company and its shareholders.

 

During the financial year, the Company did not repurchase any of its issued share capital. Pursuant to the provisions of Section 67A of the Companies Act, 1965 (the "Act"), the Company may either retain the repurchased shares as treasury shares or cancel the repurchased shares or a combination of both. The repurchased shares held as treasury shares may either be distributed as share dividends, resold on Bursa Securities in accordance with the relevant rules of Bursa Securities, subsequently cancelled or any combination of the three.

 

As treasury shares, the rights attached as to voting, dividends and participation in other distribution and otherwise are suspended and the treasury shares shall not be taken into account in calculating the number or percentage of shares or of a class of shares for any purposes including substantial shareholdings, takeovers, notices, the requisitioning of meetings, the quorum for a meeting and the result of a vote on a resolution at a meeting.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

26.          Trade and other payables


Group

Company


2015

2014

2015

2014


RM'000

RM'000

RM'000

RM'000






Trade payables

211

102

8

22

Other payables

5,296

3,635

1,230

960


5,507

3,737

1,238

982

 

 

 

 

 

 

 

 

 

 

                The normal trade credit terms granted to the Group ranges from 7 to 90 days.

 

27.          Employee entitlements

 

Group and Company


Provision for employee entitlements



RM'000




At 1 January and 31 December 2015

 

15

 

28.          Financial instruments

 

28.1        Capital risk management

 

The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may return capital to shareholders, issue new shares or sell assets to reduce debt. The Group is not subjected to any externally imposed capital requirement.

 

28.2        Classification of financial instruments

 

Financial assets and financial liabilities are measured on an ongoing basis either at fair value or at amortised cost. The principal accounting policies of the Group described how the classes of financial instruments are measured, and how income and expenses, including fair value gains and losses, are recognised, The following table analysed the financial assets and liabilities at the reporting date by the classes of financial instruments to which they are assigned, and therefore by the measurement basis.

 

Group


Loans and receivables

Available-for-sale investments 

Financial liabilities at amortised cost

 

 

Total

31 December 2015

RM'000

RM'000

RM'000

RM'000






Financial Assets





Available-for-sale investments

-

84

-

84

Trade and other receivables

93,820

-

-

93,820

Short term investments

-

110,422

-

110,422

Cash and cash equivalents

26,755

-

-

26,755


120,575

110,506

-

231,081

 

 

 

 

 

 

 

 

Financial Liabilities





Trade and other payables

-

-

5,507

5,507


-

-

5,507

5,507

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

28.          Financial instruments (continued)

 

28.2        Classification of financial instruments (continued)

 

Group


Loans and receivables

Available-for-sale investments 

Financial liabilities at amortised cost

 

 

Total

31 December 2014

RM'000

RM'000

RM'000

RM'000






Financial Assets





Available-for-sale investments

-

57

-

57

Trade and other receivables

44,026

-

-

44,026

Short term investments

-

123,719

-

123,719

Cash and cash equivalents

43,738

-

-

43,738


87,764

123,776

-

211,540






 

 

 

 

 

 

 

Financial Liabilities





Trade and other payables

-

-

3,737

3,737


-

-

3,737

3,737

 

 

 

 

 

Company


Loans and receivables

Available-for-sale investments 

Financial liabilities at amortised cost

 

 

Total

31 December 2015

RM'000

RM'000

RM'000

RM'000






Financial Assets





Available-for-sale investments

-

13

-

13

Trade and other receivables

1,299

-

-

1,299

Short term investments

-

107,940

-

107,940

Cash and cash equivalents

24,275

-

-

24,275


25,574

107,953

-

133,527






 

 

 

 

 

 

 

                                                       

Financial Liabilities





Trade and other payables

-

-

1,238

1,238


-

-

1,238

1,238






31 December 2014










Financial Assets





Available-for-sale investments

-

20

-

20

Trade and other receivables

1,148

-

-

1,148

Short term investments

-

119,263

-

119,263

Cash and cash equivalents

29,843

-

-

29,843


30,991

119,283

-

150,274






 

 

 

 

 

 

 

 

Financial Liabilities





Trade and other payables

-

-

982

982


-

-

982

982






 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

28.          Financial instruments (continued)

 

28.3        Financial risk management objectives and policies

 

The Group's principal financial instruments consist of cash, short-term deposits and short term investments. The main purpose of these financial instruments is to finance the Group's operations and investments. The Group has other financial instruments such as receivables and payables that arise directly from its operations.

 

The Directors recognise that financial risk management is an area in which they may need to develop specific policies should the Group become exposed to further financial risks as the business develops.

 

The main risks arising from the Group's financial instruments are credit risk and market risk which include foreign exchange rates and equity prices. The Board reviews and agrees policies for managing each of these risks as and when they arise. Currently, the Group does not expose to interest rate risk and liquidity risk.

 

Credit risk

The Group has adopted a policy of only dealing with recognised creditworthy third parties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults.

 

The Group and the Company manages the exposures to credit risk by performing credit evaluations on all of their major customers requiring credit, and where appropriate, credit guarantee insurance is purchased. The Group's maximum exposure to credit risk is represented by the carrying amount of financial assets in the financial statements which amounts to RM231 million.

 

As the Group trades only with recognised creditworthy third parties, there is no requirement for collateral. The credit risk on liquid funds is limited because counterparties are banks with high credit ratings.

 

Foreign currency risk

The Group has some structural currency exposure as some of its investments and operations are in Thai Baht. Apart from the proceeds derived in Ringgit Malaysia, the Group also receives proceeds from rubber block sales in US Dollars. However the foreign currency risk is considered immaterial to the Group and the Company as a whole.

 

Market price risk

The Group is exposed to unquoted unit trusts market price and equity securities price risk, from the investments held by the Group and classified as short term investments and available-for-sale investments respectively.

 

Market price sensitivity analysis

The following table demonstrates the sensitivity to a reasonably possible change in market price, with all other variables held constant, of the Group's and the Company's profit before tax (through the impact on fair value through profit or loss).

 


Group

Company


RM'000

RM'000

31 December 2015



Investment in Malaysia



   Market price increase by 10 percentage point

14,219

                13,710                  .

   Market price decrease by 10 percentage point

(14,219)

           (13,710)




31 December 2014



Investment in Malaysia



   Market price increase by 10 percentage point

13,550

                13,046                  .

   Market price decrease by 10 percentage point

(13,550)

           (13,046)

 

Hedges

The Group did not enter into any interest rate swaps or forward currency contracts to hedge against interest rate risk or foreign currency risk.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

______________________________________________________________________________________________

 

28.          Financial instruments (continued)

               

28.4        Fair values measurements

The fair values of financial assets and financial liabilities of the Group and the Company approximates to their carrying amounts, as disclosed in the statement of financial position and related notes.

 

Fair value hierarchy

The Group's and the Company's financial instruments carried at fair value are analysed as follows:

 

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;

 

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the assets or liabilities, either directly (i.e. as prices) or indirectly (i.e. derived from prices);

 

Level 3: Inputs for the assets or liabilities that are not based on observable market date (unobservable inputs).

 

As at reporting date, the Group's and the Company's quoted other investments are classified as Level 1.

 

There were no material transfers between Level 1, Level 2 and Level 3 during the financial year. The Group and the Company do not have any financial instruments classified as Level 2 and Level 3 as at 31 December 2015.

 

29.          Related party transactions

 

Transactions within the Group have been eliminated in the preparation of the financial information set out in this report and are not disclosed in this note. Balance and transaction with other related parties are either disclosed under the relevant notes or disclosed below.

 

Compensation of key management personnel of the Group

Key management personnel of the Group are defined as those persons having authority and responsibility for the planning, directing and controlling the activities of the Group, directly or indirectly. Key management of the Group are therefore considered to be the Directors and top management personnel of the Company. The following table summarises compensation paid to key personnel:

 

 

Group and Company

 

2015

2014

 

RM'000

RM'000

 

 

 

Short-term employment benefits

662

609

 

Further information about the remuneration of individual Directors is shown in note 11 and in the Corporate Governance Statement.

 

30.          Control

The Company and Group are controlled by its shareholders. No one individual has overall control of the Company.

 

31.          Prior year adjustments

 

Prior to 2014, available-for-sale investment was written down due to fair value adjustment. Subsequently, certain investment had fully impaired. The investment revaluation reserve relating to this investment of RM2.885 million should have been reclassified to profit and loss account. This adjustment is the effect of the correction of the error.

 

The adjustment to deferred tax liability arose from the revaluation of land which should have reflected the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover the carrying amount through sale after implementation of the Group business plan.

 

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2014

______________________________________________________________________________________________

 

32.          Commitments

 

                Financial commitment

 

                The Group and Company have the following future minimum lease obligations payable under operating

    leases:


 

Land and buildings




2015

2014




RM'000

RM'000

Group





Operating leases which expire:





Within one year



760

340

Between two and five years



517

-




1,277

340






Company





Operating leases which expire:





Within one year



328

240

Between two and five years



219

-




547

240






                Operating lease payment represents rental payable by the Group and the Company for the use of office premise.

 

                Capital commitment    




2015

2014




RM'000

RM'000

Group





Commitment for the construction of low cost houses in Dunedin estate



 

-

 

2,900

Acquisition of land in Sandakan



-

1,048

Renovation of resorts and motel rooms



243

-

 

33.          Events after the balance sheet date

 

There were no material subsequent events since 31 December 2015 until 15 April 2016. The Directors proposed that a 2% interim dividend for the financial year ended 31 December 2015 be distributed to the shareholders during the year 2016. The interim dividend is under the single tier system of £0.002

per share, on 403,209,200 ordinary shares..

 

34.          Realised and unrealised Profits

 

The breakdown of retained profits of the Group, pursuant to the format prescribed by Bursa Securities, is as follows:

 

As at

 

As at

 

31 Dec 2015

 

31 Dec 2014

 

RM'000

 

RM'000

restated

Total Retained Profits of the Company and its subsidiaries:

 - Realised

          133,187 

 

144,394 

 - Unrealised

     90            

 

     (183)            

 

133,277

 

144,211

Total share of Retained Profits from associated company:

 - Realised

-

 

-

 - Unrealised

(2,149)

 

(6,747)

 

Less : Consolidation effects

(2,149)

(7,307)

 

(6,747)

(7,306)

Total Group Retained Profit

123,821

 

130,158

 

List of Properties Registered under the Group of companies

as at 31 December 2015

 

 

 Leasehold/

Title Nos

 

 

 

Tenure

 

 

Existing Use

 

 

Land Area

(Hectare)

 

Age of Property (Year)

 

Net Book Value 31/12/2015

(RM'000)

 

Date of Acquisition/Last Revaluation









1

Lot Nos:

Freehold

Oil Palm

138.57

100

316,500

Acquired on


505, 626, 1005, 1091,


Plantation




24.03.1914 -


1204, 1910, 1912, 1940,






16.06.1916


23800, 23801, 23802,






and last


23803, 23804, 23805,






revalued on


23806, 23807, 24375,






18.01.2016


25269, 25270, 25272,








25273, 25275, 25278
























Kajang estate, Mukim of Semenyih, Daerah Ulu Langat, Selangor

 

2

 

Lot Nos:

 

Freehold

 

Oil Palm

 

61.89

 

100

 

115,000

 

Acquired on


540,


Plantation




24.03.1914 -


PT 21625






16.06.1916


PT 21630






and last








revalued on








18.01.2016










Dunedin estate, Mukim of Semenyih, Daerah Ulu Langat, Selangor

 









3

H.S.(D) 1470

Leasehold

Resort

9.9947

26

2,585

Acquired on


PT Lot 354

expiring in

Land and




18.08.1990



2050

Buildings














Mukim of Pulau Perhentian, Daerah Besut, Terengganu












 

4

 

Title

No. 9654

 

Freehold

 

Land, Factory  and Office building

 

5.18                 

 

16                

 

946

Acquired on

24.08.2009

and last revalued on 22.01.2010










77/17 Moo 4 Bangmaruan Road, Tambon Bang Muang, Takuapa 82190, Phangnga, South Thailand









 

5

 

Lot No. 3468

 

Freehold

 

Motel, Land and Buildings

 

       2.38

 

31

 

19,000

 

Acquired on 30.10.2009 and last revalued on








           11.01.2015

 

 


Mukim of Bukit Besar, Kuala Terengganu

 








 

List of Properties Registered under the Group of companies

as at 31 December 2015

 

 

 Leasehold/

Title Nos

 

 

 

Tenure

 

 

Existing Use

 

 

Land Area

(Hectare)

 

Age of Property (Year)

 

Net Book Value 31/12/2015

(RM'000)

 

Date of Acquisition/Last Revaluation

 

 

6

15-06A

Leasehold

Apartment

91sq. m.

21

71

Acquired on


Amber Tower

expiring in





30.06.2003


Seri Mas

2085







Condominium








Batu 3 ½ Cheras








56000 Kuala Lumpur







 

 

Lot No. 51810, Mukim of Kuala Lumpur, Wilayah Persekutuan

 

 

7

H.S.(D) 22923

Leasehold

Leasehold 

902.4195sq. m.

26.5

2,385

Acquired on


Bandar Port Swettenham

expiring in

Land




31.12.2012



2088














               

District of Klang, State of Selangor

 

 

 



NOTICE OF ANNUAL GENERAL MEETING

 

NOTICE IS HEREBY GIVEN THAT the One Hundred and Sixth Annual General Meeting ("AGM") of the Company will be held at Bilik Perdana, Dewan Perdana Felda, Jalan Maktab, Off Jalan Semarak, 50400 Kuala Lumpur on Tuesday, 24 May 2016 at 10:00 a.m. for the following purposes:

 

1.

To receive and adopt the financial statements for the year ended 31 December 2015 and the Reports of the Directors and Auditors thereon.

Resolution 1




2.

To approve the payment of Directors' fees in respect of the year ended 31 December 2015.

Resolution 2




3.

To re-appoint Messrs UHY Hacker Young LLP as Auditors of the Company and to authorise the Directors to fix their remuneration.

Resolution 3





AS SPECIAL BUSINESS

To consider and if thought fit, to pass the following Ordinary Resolutions:




4.

To re-appoint the following Directors who are over the age of seventy (70) years, to hold office until the next AGM pursuant to Section 129(6) of the Malaysian Companies Act 1965 and Recommendations 3.2 and 3.3 of the Malaysian Code on Corporate Governance 2012 ("MCCG 2012"):






(a)

Dato' Adnan bin Maaruf

Resolution 4


(b)

Dato' Haji Muda bin Mohamed

Resolution 5


(c)

Dr. Radzuan bin A. Rahman

Resolution 6




5.

To re-appoint Dato' Tik bin Mustaffa who is over the age of seventy (70) years, to hold office until the next AGM pursuant to Section 129(6) of the Malaysian Companies Act 1965.

Resolution 7




6.

PROPOSED RESOLUTION TO EMPOWER THE DIRECTORS OF INCH KENNETH KAJANG RUBBER PUBLIC LIMITED COMPANY ("IKKR" OR "THE COMPANY") TO ISSUE SHARES PURSUANT TO SECTION 551 OF THE UNITED KINGDOM COMPANIES ACT 2006 ("UK COMPANIES ACT 2006")

Resolution 8





The New Mandate will enable the Directors to take swift action in case of, inter alia, a need for corporate exercises or in the event of business opportunities or other arising circumstances which involve the issue of new shares, and to avoid delay and cost in convening general meetings to approve such issue of shares.    





7.

PROPOSED RENEWAL OF AUTHORITY FOR THE PURCHASE BY THE COMPANY OF ITS OWN SHARES

Resolution 9





"THAT, subject to the Malaysian Companies Act 1965, the Memorandum and Articles of Association of the Company and the requirements of Bursa Malaysia Securities Berhad ("Bursa Securities") and any other relevant authorities, the Company be generally and unconditionally authorised to make market purchases (within the meaning of section 701(3) of the UK Companies Act 2006) of ordinary shares of 10p each in the capital of the Company ("IKKR Shares") provided that:






(a)

the maximum number of IKKR Shares hereby authorised to be purchased is 42,075,000 (representing 10% of the Company's issued ordinary share capital at 8 April 2016);







(b)

the maximum amount of funds to be allocated by the Company shall not exceed the audited retained profits and the share premium account of the Company as at 31 December 2015 of RM144,747,242 and RM8,434 respectively;







(c)

the minimum price, exclusive of any expenses, which may be paid for an IKKR Share is the prevailing market share price;







(d)

the maximum price, exclusive of any expenses, which may be paid for any such share is an amount not more than 15% above the weighted average share price for the five (5) market days immediately preceding the date of the purchase(s);







(e)

upon the full implementation of the Proposed Share Buy-Back, the Directors of the Company be and hereby authorised to decide in their absolute discretion to either retain the IKKR Shares purchased by the Company pursuant to the Proposed Share Buy-Back ("Purchased Shares") as treasury shares to be resold on the stock exchanges where IKKR Shares are listed; or the Purchased Shares may be cancelled; or the Purchased Shares may in part be retained as treasury shares and the remainder cancelled;







(f)

the authority hereby conferred shall be in force immediately upon the passing of this resolution until the earlier of 25 November 2017 (the date which is 18 months after the meeting) or the close of the next AGM of the Company or the authority is revoked or varied by ordinary resolution passed by the shareholders in a general meeting; and







(g)

the Company may make a contract for the purchase of IKKR Shares under this authority before the expiry of this authority which would or might be executed wholly or partly after the expiry of such authority, and may make purchases of IKKR Shares in pursuance of such a contract as if such authority had not expired."







To transact any other business of which due notice shall have been given.


 

 

 

By order of the Board

 

 

LEE THAI THYE (LS 0000737)

Company Secretary

 

Kuala Lumpur, Malaysia

29 April 2016

 

 

NOTES:

 

Appointment of Proxy

 

1.     A member of the Company entitled to attend and vote is entitled to appoint a proxy or proxies to attend and vote in his stead. A proxy need not be a member of the Company.

2.     The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing, or if the appointor is a corporation, either under its common seal or signed by an officer or attorney duly authorised.

3.     Where a member appoints more than one proxy, the appointment shall not be valid unless he specifies the proportion of his holding to be represented by each proxy.

4.     Any alteration in the proxy form must be initialled.

5.     The instrument appointing a proxy must be deposited at the Registrar's Office, 22nd Floor Menara Promet (KH), Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia, not less than forty-eight (48) hours before the time for holding the meeting or any adjournment thereof. For shareholders residing outside of Malaysia, the Proxy Form could be forwarded by fax at +603 2141 9650 or by email to [email protected]

6.     For the purpose of determining a member who shall be entitled to attend the 106th AGM, the Company shall be requesting Bursa Malaysia Depository Sdn Bhd to issue a General Meeting Record of Depositors ("ROD") as at 18 May 2016. Only a depositor whose name appears on the Register of Members/ROD therein shall be entitled to attend the said meeting or appoint a proxy to attend and/or vote on his/her stead.

 



 

EXPLANATORY NOTES ON SPECIAL BUSINESS

 

7.     Resolutions 4, 5 and 6 - Re-appointment of Directors pursuant to Section 129(6) of the Malaysian Companies Act, 1965

 

        The Board of Directors vide the Nomination Committee's recommendations and decide that the Directors who retire pursuant to Section 129(6) of the Malaysian Companies Act 1965 at the 106th AGM are eligible to stand for re-appointment based on their assessment. Their profiles are referred to on pages 3 and 4 of the Annual Report.

 

        Dato' Adnan bin Maaruf, Dato' Haji Muda bin Mohamed and Dr Radzuan bin A. Rahman had abstained from deliberations and decisions of the Board on their respective re-appointment. The Board feels that they have satisfactorily demonstrated their independence and free from any business which could interfere with their ability to act in the best interests of the Company.

 

(i)    The re-appointment of Dato' Adnan bin Maaruf, a person over the age of seventy (70) years as a Director of the Company to hold office until the conclusion of the next AGM of the Company shall take effect if the proposed Resolution 4 has been passed by a majority of not less than three-fourths (3/4) of such members as being entitled to vote in person or by proxies at the 106th AGM.

 

(ii)   The re-appointment of Dato' Haji Muda bin Mohamed, a person over the age of seventy (70) years as a Director of the Company to hold office until the conclusion of the next AGM of the Company shall take effect if the proposed Resolution 5 has been passed by a majority of not less than three-fourths (3/4) of such members as being entitled to vote in person or by proxies at the 106th AGM.

 

(iii)  The re-appointment of Dr Radzuan bin A. Rahman, a person over the age of seventy (70) years as a Director of the Company to hold office until the conclusion of the next AGM of the Company shall take effect if the proposed Resolution 6 has been passed by a majority of not less than three-fourths (3/4) of such members as being entitled to vote in person or by proxies at the 106th AGM.

 

Although Recommendations 3.2 and 3.3 of the MCCG 2012 which states that the tenure of an Independent Director shall not exceed a cumulative term of nine (9) years, the justifications for the retention of Dato' Adnan bin Maaruf, Dato' Haji Muda bin Mohamed and Dr Radzuan bin A. Rahman to continue serving the Company as Independent Directors are:-

 

a)     They have fulfilled the definition of Independent Director under the Main Market Listing Requirements of Bursa Securities and had expressed their willingness to continue in office as Independent Directors of the Company;

b)    They have challenged the management in an effective and constructive manner, providing a check and balance, and bring an element of objectivity to the Board;

c)     They have no interest or ties in the Company and/or Group that could adversely or materially interfere with their independent judgement;

d)    They have actively participated in Board deliberation, judged in an objective, independent and unfettered manner, discharged their duties with reasonable care, skill and diligent, and brought independent thought and experience in decision making;

e)     They have devoted sufficient time and attention to their responsibilities as Independent Directors of the Company; and

f)     They have exercised due care in all undertakings of the Company and/or Group and have carried out their fiduciary duties in the interest of the Company and/or Group and minority shareholders during their tenure as Independent Directors of the Company.

 

8.     Resolution 7 - Re-appointment of Directors pursuant to Section 129(6) of the Malaysian Companies Act 1965

 

The Board of Directors vide the Nomination Committee recommendation and decide that Dato' Tik bin Mustaffa who retires pursuant to Section 129(6) of the Malaysian Companies Act 1965 at the 106th AGM is eligible to stand for re-appointment based on their assessment.

 

His profile is set out on page 4 of the Annual Report.

 

9.     Resolution 8 - Authority for Directors to issue shares pursuant to Section 551 of the UK Companies Act 2006

 

 

 

This resolution is proposed pursuant to Section 551 of the UK Companies Act 2006, and if passed, will give the   Directors of the Company, from the date of the above AGM, authority to issue ordinary shares in the Company not exceeding 10% of the issued capital of the Company. This authority, unless revoked or varied at a general meeting, will expire at the conclusion of the next AGM 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 105th AGM held on 16 June 2015 which will lapse at the conclusion of the 106th AGM.

 

The renewal of this mandate will enable the Directors to avoid any delay and cost involved in convening a general meeting. It is thus appropriate to seek members' approval.

 

10.   Resolution 9 - Proposed renewal of authority for the purchase by the Company of its own shares

 

The details on Resolution 9 on the Proposed Renewal of Authority is included in the Statement to Shareholders      dated 29 April 2016 which is enclosed together with the Annual Report.

 



 

INCH KENNETH KAJANG RUBBER PUBLIC LIMITED COMPANY                                             PROXY FORM

 

CDS AC No:  _____________________

No of Shares Held:  _________________

               

 

I/We________________________________________________________(NRIC/CO NO): ___________________

                                         (FULL NAME IN BLOCK LETTERS)

 

of_____________________________________________________________________________________________

                                                                               (ADDRESS)                                          

 

being a shareholder/shareholders of Inch Kenneth Kajang Rubber Public Limited Company, hereby appoint *The Chairman of  the Company or

 

___________________________________________________________________________________(___________)

                           (FULL NAME OF PROXY)                                                                                            %

 

of_____________________________________________________________________________________________

                                                        (ADDRESS)                                 

 

*and/or failing whom __________________________________________________________________(_________) 

                                                               FULL NAME OF PROXY)                                                                       %

 

of_____________________________________________________________________________________________

                                                                                    (ADDRESS)                                     

 

as *my/our proxy to vote on *my/our behalf at the 106th Annual General Meeting of the Company to be held at Bilik Perdana, Dewan Perdana Felda, Jalan Maktab, Off Jalan Semarak, 50400 Kuala Lumpur on Tuesday, 24 May 2016 at 10:00 a.m. for the following purposes:

 

NO

RESOLUTION

FOR

AGAINST

1

Receive and adopt the Directors' Report and Financial Statements



2

Approve the payment of Directors' fees



3

Re-appoint Messrs UHY Hacker Young LLP as Auditors of the Company and to authorise the Directors to fix their remuneration



4(a)

SPECIAL BUSINESS - ORDINARY RESOLUTION 4

To re-appoint Dato' Adnan bin Maaruf



4(b)

SPECIAL BUSINESS - ORDINARY RESOLUTION 5

To re-appoint Dato' Haji Muda bin Mohamed



4(c)

SPECIAL BUSINESS - ORDINARY RESOLUTION 6

To re-appoint Dr Radzuan bin A. Rahman



5

SPECIAL BUSINESS - ORDINARY RESOLUTION 7

To re-appoint Dato' Tik bin Mustaffa



6

SPECIAL BUSINESS - ORDINARY RESOLUTION 8

To approve the proposed resolution to empower the Directors of the Company to issue shares pursuant to section 551 of the UK Companies Act 2006



7

SPECIAL BUSINESS - ORDINARY RESOLUTION 9

To approve the proposed renewal of authority for the purchase by the Company of its own shares



 

Please indicate with an 'X' in the appropriate spaces how you wish your votes to be casted. If no specific direction as to voting is given, your proxy will vote or abstain from voting at his/her discretion.

 

_______________________________                                                        Dated this day _______ of __________ 2016

Signature/Seal of Shareholder(s)

 

Tel No: _________________________

 

*Delete whichever is not applicable.

 

Note:

A member of the Company entitled to attend and vote is entitled to appoint a proxy or proxies to attend and vote in his stead. A proxy need not be a member of the Company. Where a member appoints more than one proxy, the appointment shall not be valid unless he specifies the proportion of his holding to be represented by each proxy. Any alteration in the proxy form must be initialled. The instrument appointing a proxy must be deposited at the Registrar's Office of the Company, not less than forty-eight (48) hours before the time for holding the meeting. For shareholders residing outside of Malaysia, the Proxy Form could be forwarded by fax at +603 2141 9650 or by email to [email protected]

 


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