OPTIMIZING OPPORTUNITIES - Tanah Makmur Berhad

Transcription

OPTIMIZING
OPPORTUNITIES
ANNUAL
REPORT
20
14
CONTENTS
2
5
6
8
9
10
18
20
34
36
38
39
46
52
Notice of Annual General Meeting
The Company
Corporate Information
Group Financial Highlights
Group Structure
Chairperson’s Statement
Board of Directors
Directors’ Profile
Key Management
Profiles of Key Management
Location of Operations
Business Activities of
Tanah Makmur Berhad
Audit Committee Report
Corporate Governance Statement
63
66
68
71
71
72
172
173
174
175
177
Statement on Risk Management and
Internal Controls
Corporate Social Responsibility
Additional Compliance Information
Financial Calendar
Statement of Directors' Responsibility in
Respect of The Annual Audited Financial
Statements
Financial Statements
Information on
Substantial Shareholders
Shareholdings Statistics
Directors’ Interest in Shares
List of Thirty Largest Shareholders
Material Properties Held by The Group
Proxy Form
COVER RATIONALE
In 2014, Tanah Makmur Berhad's growth momentum continues at an
impressive pace. Our ability to fully optimize the opportunities that
have come our way has resulted in significant expansion. Our desire
to enhance shareholder’s value is balanced by our genuine concern
for the environment.
Emerging from a challenging operating environment in 2013,
the values of our plantations have increased, amidst further
launchings of properties and the humanising of our business
operations to spur growth. Guided by our corporate vision, we are
advancing into a promising future.
Page 2 | Annual Report 2014
Tanah Makmur Berhad (841938-U)
NOTICE OF
ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN that the sixth Annual
General Meeting of Tanah Makmur Berhad
(“Tanah Makmur” or “the Company”) will be held
on Tuesday, 16th June 2015 at 10.30 am at
Meranti Room 1, Hyatt Regency Kuantan Resort,
Telok Chempedak, 25050 Kuantan, Pahang Darul
Makmur to transact the following purposes:
AGENDA
As Special Business
As Ordinary Business
To consider and if thought fit, to pass the following resolutions with
or without any modification:
1.
2.
To receive the Audited Financial Statement for the financial
year ended 31 December 2014 together with the Reports of
the Directors and Auditors thereon.(Please refer to Note A)
To re-elect the following Directors each of whom retires
pursuant to Article 95 of the Company’s Articles of
Association:
2.1
YAM Tengku Tan Sri (Dr) Hajjah Meriam binti Sultan Haji
Ahmad Shah
Ordinary Resolution 1
2.2 YBhg. Tan Sri Dato’ Sri Abdul Aziz bin Abdul Rahman
3.
To re-elect Puan Darawati Hussain binti Dato’ Seri Abdul
Latiff who retires pursuant to Article 101 of the Company’s
Articles of Association.
4.
To re-elect YM Tengku Dato’ Zubir bin Tengku Dato’
Ubaidillah who retires pursuant to Article 105 of the
Company’s Article of Association. Ordinary Resolution 4
5.
To approve the payment of Directors’ fees for the financial
year ended 31 December 2014.
6.
To re-appoint Messrs. Ernst & Young as Auditors for the
ensuing year and to authorise the Directors to fix their
remuneration.
7.
General Authority For The Directors To Issue Shares
Pursuant To Section 132D Of The Companies Act, 1965
“That subject to the Companies Act, 1965, the Articles of
Association of the Company and the approvals from Bursa
Malaysia Securities Berhad and other relevant
government/regulatory authorities, where such approval is
necessary the Directors of the Company be and are hereby
empowered pursuant to Section 132D of the Companies Act,
1965, to issue new ordinary shares of RM0.50 each in the
Company at any time upon such terms and conditions and for
such purposes as the Directors may, in their absolute
discretion deem fit and expedient in the interest of the
Company, provided that the aggregate number of shares
issued pursuant to this resolution does not exceed 10% of the
issued and paid-up share capital of the Company for the time
being and that the Directors be and are also empowered to
obtain the approval for the listing of and quotation for the
additional shares so issued on the Bursa Malaysia Securities
Berhad and that such authority shall continue in force until
the conclusion of the next Annual General Meeting of the
Company.”
By Order of the Board
SUZILAH BINTI HAJI WAHID (LS 000585)
TEH FOO HOCK (MIA 10750)
Company Secretaries
Kuantan
22 May 2015
Notice of
Annual General Meeting
Notes on Proxy:
1.
Only members whose names appear in the Record of Depositors on 9 June 2015 (General Meeting Record of Depositors) shall be
eligible to attend and vote at the meeting as well as for appointment of proxy(ies) to attend and vote on his/her stead.
2.
A member of the company entitled to attend and vote at the meeting 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.
3.
The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised or where the
appointment is executed by a corporation, it must be either under seal or under the hand of its attorney duly authorised. There
shall be no restriction as to the qualification of the proxy. A proxy appointed to attend and vote at a meeting of the Company shall
have the same rights as the member to speak at a meeting.
4.
A member shall be entitled to appoint not more than two (2) proxies to attend and vote at the same meeting.
5.
Where the holder or the authorised nominee shall be entitled to appoint not more than two (2) proxies, or where an exempt
authorised nominee appoints two (2) or more proxies to attend and vote at the same meeting such appointment shall be invalid
unless he specifies the proportion of his shareholdings to be represented by each proxy.
6.
Where a member of the Company is an authorised nominee as defined under the Securities Industries (Central Depositories) Act,
1991 (“SICDA”), it may appoint at least one (1) proxy but not more than two (2) proxies in respect of each Securities Account it
holds with ordinary shares of the Company standing to the credit of the said Securities Account.
7.
Where a member of the Company is an exempt authorised nominee as defined under the SICDA which holds ordinary shares in the
Company for multiple beneficial owners in one securities account (“omnibus account”), there is no limit to the number of proxies
which the exempt authorised nominee may appoint in respect of each omnibus account it holds. An exempt authorised nominee
refers to an authorised nominee defined under the SICDA which is exempted from compliance with the provisions of subsection
25A(1) of SICDA.
8.
The instrument of proxy must be deposited at the Registered Address of the Company at Bangunan Tanah Makmur, No. 1, Jalan
Besar, 25000 Kuantan, Pahang Darul Makmur at least forty-eight (48) hours before the time set for holding the meeting or any
adjournment thereof.
Notice of
Annual General Meeting
Explanatory Notes on the Ordinary Business/Special Business:
Item 1 of the Agenda
A.
Agenda item No. 1 is meant for presentation and discussion only as under the provisions of Section 169(1) of the Companies Act,
1965, the Audited Financial Statements do not require the formal approval of shareholders and hence, the matter will not be put
forward for voting.
Item 7 of the Agenda
B.
Authority To Issue Shares Under Section 132D
The ordinary resolution proposed under Agenda 7 if passed, will give the Directors of the Company, from the date of the 6th Annual
General Meeting, authority to issue and allot shares up to 10% of the issued and paid-up share capital of the Company for such
purposes as the Directors in their absolute discretion consider to be in the interest of the Company, without having to convene a
General Meeting. This authority unless revoked or varied at a General Meeting will expire at the next Annual General Meeting.
*
The general mandate for issue of shares is a new mandate.
The general mandate sought will enable the Directors of the Company to issue and allot shares, including but not limited for further
placing of shares for purpose of funding investment(s), working capital and/or acquisitions, at any time to such persons in their
absolute discretion without convening a general meeting as it would be both costs and time-consuming to organise a
general meeting.
THE
COMPANY
Our Company was incorporated in Malaysia under the Companies Act 1965
as a private limited company on 18 December 2008 under the name of Kreatif
Selaras Sdn Bhd and we commenced our business on 5 May 2009.
On 17 October 2013, our name was changed to Tanah Makmur Sdn Bhd and
on 29 November 2013, our Company was subsequently converted into a public
limited company and assumed its present name of Tanah Makmur Berhad.
Our Group is principally involved in the cultivation of oil palms and its ancillary
activities comprising the operation of our palm oil mill and compost plant. Our
Group is also involved in other non-oil palm related activities such as property
development in Pahang, Malaysia.
CORPORATE
INFORMATION
BOARD OF DIRECTORS
COMMITTEES OF THE BOARD
Non-Independent Non-Executive Chairman
YAM Tengku Tan Sri Dr. Hajjah Meriam binti
Sultan Haji Ahmad Shah
Designated as Chairman on 24 September 2013
AUDIT COMMITTEE
Managing Director
YM. Tengku Dato’ Zubir bin Tengku Dato’ Ubaidillah
Members
YH. Dato’ Dr. Zaha Rina binti Zahari
YH. Dato’ Thavalingam a/l C Thavarajah
Chairman
YH. Dato’ Cheong Keap Tai
Non-Independent Non-Executive Director
YM. Tengku Dato’ Sri Ahmad Faisal bin Tengku Ibrahim
REMUNERATION COMMITTEE
YH. Dato’ Wan Bakri bin Wan Ismail
Appointed as Director on 3 December 2013
Chairman
YBhg. Tan Sri Dato’ Sri Abdul Aziz bin Abdul Rahman
Independent Non-Executive Director
YBhg. Tan Sri Dato’ Sri Abdul Aziz bin Abdul Rahman
Members
NOMINATING COMMITTEE
Chairman
YH. Dato’ Thavalingam a/l C. Thavarajah
Members
Puan Darawati Hussain binti Dato’ Seri Abdul Latiff
Appointed as Director on 9 June 2014
COMPANY SECRETARIES
YM Tengku Dato’ Sri Uzir bin Tengku Dato’ Ubaidillah
Alternate Director to YM Tengku Dato’ Sri Ahmad Faisal bin
Tengku Ibrahim
Tuan Haji Abdul Rahim bin Abdullah
Alternate Director to YH Dato’ Wan Bakri bin Wan Ismail
Appointed on 11 November 2014
Dr. Nicholas Langley Boden
Resigned on 12 May 2014
Suzilah binti Haji Wahid
(LS 000585)
Teh Foo Hock
(MIA 10750)
Corporate
Information
REGISTERED OFFICE
INVESTOR RELATIONS
VALUERS
Bangunan Tanah Makmur
No. 1, Jalan Besar
25000 Kuantan
Pahang Darul Makmur
Tel
: 09-5148866
Fax
: 09-5148822 / 09-5147733
Email
: [email protected]
Website : www.tanahmakmur.com
ZJ Communique
Suite 22B, 22nd Floor
Sunway Tower
No. 86, Jalan Ampang
50450 Kuala Lumpur
Tel : 03-20322328
Fax : 03-20321328
Email : [email protected]
Azmi & Co. (Pahang) Sdn. Bhd.
No. A13, 2nd Floor, Jalan Tun Ismail
25000 Kuantan
Pahang Darul Makmur
Tel : 09-5173311
Fax : 09-5173763
LEGAL ADVISORS
SHARE REGISTRAR
PRINCIPAL BANKERS
Tricor Investor & Issuing House
Services Sdn. Bhd.
(formerly known as Equiniti Services
Sdn. Bhd.)
Level 17, The Gardens North Tower
Mid Valley City, Lingkaran Syed Putra
59200 Kuala Lumpur
Tel : 03-22643883
Fax : 03-22821886
Email : [email protected]
i)
AUDITORS
Ernst & Young
Unit 10 D-J, Level 10, Menara Zenith
Jalan Putra Square 6
25200 Kuantan
Pahang Darul Makmur
Tel : 09-5157500
Fax : 09-5157600
ii)
Maybank Islamic Berhad
Wisma KCCCI, Lot 46 & 47
Section 18, Jalan Bukit Ubi
25000 Kuantan
Pahang Darul Makmur
Tel
: 09-5121172
Fax : 09-5141622
CIMB Islamic Bank Berhad
Jalan Bank Kuantan
Bangunan BCB
Lot 32, Jalan Bank
25000 Kuantan
Pahang Darul Makmur
Tel
: 09-5162099
Fax : 09-5164116
i)
Noorhuda & Partners
B 8028, Tingkat 2
Sri Kuantan Square
Jalan Teluk Sisek
25000 Kuantan
Tel
: 09-5143796
Fax : 09-5143794
ii)
Kadir Andri & Partners
Level 10, Menara BRDB
285, Jalan Maarof
59000 Kuala Lumpur
Tel
: 03-27802888
Fax : 03-27802832
STOCK EXCHANGE LISTING
Main Market Bursa Malaysia
Securities Berhad
Listed on 17 July, 2014
Share code : 5251
GROUP FINANCIAL
HIGHLIGHTS
’14
’13
’12
’11
RM’000
RM’000
RM’000
RM’000
Revenue
388,951
243,486
207,657
282,424
EBITDA
112,007
75,639
94,745
122,910
Profit Before Tax
97,339
61,682
83,049
111,967
Profit After Tax
72,401
44,691
65,714
85,379
418,016
323,486
306,787
265,395
RM
RM
RM
RM
Net Assets Per Share
1.12
0.93
0.89
0.77
Net Earnings Per Share
0.18
0.13
0.19
0.25
372,089,592
346,019,592
346,019,592
346,019,592
Shareholders Equity
Weighted average No. of Shares Issue*
(No. of units)
* Adjusted for subdivision of shares to RM0.50 each respectively.
REVENUE
(RM’000)
EBITDA
(RM’000)
‘14
388,951
‘14
112,007
‘13
243,486
‘13
75,639
‘12
207,657
‘12
94,745
‘11
282,424
‘11
122,910
PROFIT BEFORE TAX
(RM’000)
SHAREHOLDERS’ EQUITY
(RM’000)
‘14
97,339
‘14
418,016
‘13
61,682
‘13
323,486
‘12
83,049
‘12
306,787
‘11
111,967
‘11
265,395
GROUP
STRUCTURE
Tanah Makmur Group of Companies
are mainly involved in Plantation and
Property Development as follows;-
CHAIRPERSON’S
STATEMENT
Assalamualaikum wbt. and warm greetings.
ON BEHALF OF THE BOARD OF DIRECTORS,
IT IS MY GREAT PLEASURE TO PRESENT
THE ANNUAL REPORT AND AUDITED
FINANCIAL STATEMENTS OF TANAH
MAKMUR BERHAD (THE COMPANY) FOR
THE FINANCIAL YEAR ENDED 31 DECEMBER
2014 (FYE 2014) FOLLOWING THE
SUCCESSFUL LISTING OF THE COMPANY
ON MAIN MARKET OF BURSA MALAYSIA
SECURITIES BERHAD ON 17 JULY 2014.
Chairperson’s
Statement
The Company's listing exercise involved initial public offering ("IPO")
of 101.59 million ordinary shares which comprises public issue of
52.14 million new shares and an offer for sale of 49.45 million
existing shares at an offer price of RM1.25 per share, raising RM65.18
million for the group. The retail offering registered an
oversubscription rate of 14.45 times where the price soared 55% to
RM1.94 at the end of closing on debut.
FINANCIAL PERFORMANCE
For FYE 2014, Tanah Makmur’s revenue increased 60% to RM389
million from RM243 million in FYE 2013. This was attributable to a
205% increase in revenue from property development segment to
RM109 million as well as an 8% increase in revenue from plantation
segment to RM194 million. Ancillary to the property development
segment, mining of bauxite which commenced in April 2014,
recorded a revenue of RM86 million for the FYE 2014.
In line with increase in revenue, profit attributable to equity holders
of the Group increased 26% to RM54 million. Earnings per share
increased 38% to 18 sen in FYE 2014 from 13 sen in FYE 2013,
accordingly.
Shareholders’ funds improved to RM418 million as at 31 December
2014 as compared to RM323 million as at 31 December 2013. Net
assets per share attributable to equity holders of Tanah Makmur
increased to RM122 million from RM0.93 million in the previous
corresponding period. Cash and bank balances increased to RM111
million as at 31 December 2014 from RM47 million a year ago mainly
due to proceeds raised from IPO as well as an impressive increase
in positive net cash flows from operations.
As Chairperson, I am pleased with the group’s operational and
financial performances.
PRE-TAX PROFIT
UP 26%
Chairperson’s
Statement
OPERATIONAL REVIEW
PLANTATION
The Group operates 13 plantation estates in Pahang with aggregate of 17,969.06 ha of plantation lands comprising 11,633.19 ha owned
and 6,335.87 ha leased from Lembaga Kemajuan Perusahaan Pertanian Negeri Pahang (“LKPP”). We have planted 15,363.47 ha out of
the total plantable area of 17,057.06 ha, covering 90% area in total. As at 31 December 2014, 33% of total planted areas are prime mature
(9-18 years), 18% young mature (4-8 years) and 17% old mature (19-25 years) and 32% immature. During the FYE 2014, we have planted
of 1,973 ha of oil palm (new planting).
Our fresh fruit bunches (FFB) production for the FYE 2014 was cautiously noted with a decline of 10.60% to 207,947 mt from 232,605 mt
recorded last year due to extreme climate change of wet weather from January – March 2014, followed by dry weather until October 2014,
and subsequently heavy rainfall from mid-Dec 2014 in Pahang. Nonetheless, our FFB yield of 19.95 mt for the said period is higher than the
averages for Pahang (18.41 mt), Peninsular Malaysia (18.23 mt) as well as Sabah and Sarawak (18.98 mt) and Malaysia (18.63 mt).
The Group ventured into production of crude palm oil (CPO) with the commissioning
of the palm oil mill and compost plant in July 2012. Palm kernel (PK) recovery rate
was maintained at 5.97% for both FYE 2013 and 2014. Oil extraction rate decreased
0.05% to 19.93% in FYE 2014 from 19.98% in the previous year. However, 100%
utilization rate of palm oil mill contributed to 20% and 31% increase in PK production
and CPO production respectively in FYE 2014. PK and CPO production were 11,399
mt and 41,448 mt respectively for the FYE 2014.
Planted Area as at
Financial Year End 2014
17%
32%
PROPERTY DEVELOPMENT
We are developing KotaSAS Township measuring 1,500 acres over a span of 15
years within Ladang Bukit Goh in Kuantan for its local community. The township
project is a development of residential, commercial, institutional and government
premises which can be easily accessed via the East-Coast Expressway and
Kuantan By-Pass. As part of our social responsibility, we have allocated areas to
develop three primary and two secondary schools, recreational parks, lakes and
sports facilities.
33%
18%
Immature (0-4 years)
Young Mature (4-8 years)
Prime Mature (9-18 years)
Old Mature (19-25 years)
Chairperson’s
Statement
We launched 360 units of properties which comprises 320 residential units and 40 units of shop lots at average price of RM312,500 and
RM950,000 respectively in December 2014. This is our first launch of commercial properties since our venture into property development
in 2010. We achieved a remarkable take-up rate of 80% for residential and 60% for commercial property for the RM138 million properties
launched within one month of the sales launch. To date, we have cumulatively sold properties worth RM468 million.
We are proud of our capability to complete and deliver projects ahead of schedule. Among our completion total of 6 development projects
from Precinct 1 to Precinct 3 (Phase 2), 2 property projects were on time, 3 projects were one (1) month ahead of schedule whilst
1 project was two (2) months ahead of schedule.
Bauxites were discovered during the clearing of certain parts of the land within our Ladang Bukit Goh, Kuantan for our property development
activities. Total tonnage of bauxite deposits on the said land is estimated at 1.4 million tons. Since April 2014 we exported a total of 684,389
mt of washed bauxite in FYE 2014. Bauxite prices were relatively stable at US$45 to US$47 a tonne throughout FYE 2014.
Profit Guarantee from Tanah Makmur Perkasa Sdn Bhd
In respect of the development agreement dated 8 January 2014 which was subsequently substituted by the amended restated
development agreement dated 12 May 2014 (“Development Agreement”) between KotaSAS Sdn Bhd (KotaSAS) and Tanah Makmur Kota
SAS Sdn Bhd (Tanah Makmur KotaSAS), it has been agreed upon that both parties shall jointly undertake the development and completion
of the Development Project, with Tanah Makmur KotaSAS being the master developer.
Pursuant to the above mentioned agreement, Tanah Makmur KotaSAS shall also procure Tanah Makmur Perkasa Sdn Bhd to provide
guarantee to KotaSAS that the Aggregate of the cost of the development land and 60% of the development profit that shall be attributable
to KotaSAS for five (5) financial years (commencing 1 January 2013 untill 31 December 2017) shall not be less than RM110,000,000.00.
2013
2014
2015
Financial year ended 31 December
Yearly minimum guaranteed entitlement
comprising the following:
Land Cost(1)
60% of profit before tax(2)
Total
2016
2017
Total
RM million
1.21
0.91
4.20
10.10
7.90
14.42
12.46
18.97
19.00
20.83
44.77
65.23
2.12
14.30
22.32
31.43
39.83
110.00
Notes:
(1)
The land cost as set out in the table above is the capped amount in so far as it it
concerns the determination of whether the yearly minimum guaranteed entitlement
is met (“Land Const”). Any amount actually recognised by KotaSAS and Tanah
Makmur KotaSAS as Land Cost in any financial year which is in excess of the yearly
guaranteed Land Cost will be ignored and shall not be used to determine whether
the yearly minimum guarantee entitlement is met.
(2) The 60% of profit before tax (“Landowner’s Portion”) as set out in the table above
shall refer to the profit before tax disclosed in the audited financial statements of
Tanah Makmur KotaSAS for each of the financial years. The Landowner’s Portion is
the minimum amount in so far as it concerns the determination of whether yearly
minimum guaranteed entitlement is met. In determining whether the yearly minimum
guaranteed entitlement is met, if;
(i)
The landowner’s Portion in any financial year is in excess of the yearly
minimum guaranteed Landowner’s Portions as set out in the table above for
that year; and
(ii) the Land Cost actually recognised by KotaSAS in that year is lesser than the
yearly guaranteed Land Cost as set out in the table above for that year,
then, any amount in excess of the yearly minimum guaranteed Landowner’s Portion
for that year can be used to top up the deficiency in the Land Cost actually recognised
by KotaSAS and Tanah Makmur KotaSAS in that year.
Chairperson’s
Statement
On behalf of the board of Directors, I would like to inform that there
is no shortfall in both the aggregate cost of the development land
and 60% of the development profit attributable to KotaSAS for the
financial years ended 31 December 2013 and 2014.
PROSPECTS
Our plantation segment is expected to achieve a higher FFB
production as more planted areas are entering into their prime age
profiles in financial year ending 2015 (“FYE 2015”). In addition, we
are expecting CPO production to increase in the coming year
following the anticipated of higher supply of FFB and the expansion
of palm oil mill from the current capacity of 30 tonnes per hour
(“tph”) to 45 tph which will be completed by 2016.
We plan to do replanting a total of 1,378.7 ha in 2015 – 2018 will be
carried out in three of our plantation estates – Ladang Charuk
Puting, Ladang Empang Jaleh and Ladang Lembah Klau. We are
targeting new plantings of 1,119.67 ha which comprises of two
plantation estates Ladang Alur Seri and Ladang Ulu Lepar.
We have identified two (2) potential plantation lands in Kampong
Bongsu and Ulu Lepar with land sizes measuring approximately
1,214 ha and 1,436 ha respectively. We are collaborating with LKPP
to secure the acquisition of these lands from the State Government
of Pahang.
Our property development business has unbilled sales of
approximately of RM118 million as at 31 December 2014. The Group
has total undeveloped landbanks of 836.55 acres which comprises
524.25 acres and 312.30 acres for residential and commercial
development respectively for the next 5 – 10 years for a potential
Gross Development Value (GDV) of up to RM 3.00 billion from the
presently estimated RM 1.80 billion, taking into consideration the
improvements to our property development plans that we have
made on the assumption of the relocation of the new State
Administrative Complex and a State Assembly Hall to our
KotaSAS Township, and favourable market demand for our
properties. Encouraged by a strong take-up rate for the properties
launched in December 2014, the Group will be launching another
774 residential properties amounting to a GDV of RM355 million until
Chairperson’s
Statement
November 2015. However, the number of the property
units to be launched and the estimated GDV for the year
will be lower if the prevailing market demand for the
properties in Kuantan is not conducive, which will result
in the launches being deferred to the subsequent year.
Tanah Makmur, via a 65%-owned subsidiary, Kreatif
Sinar Gabungan Sdn Bhd, had received a letter of intent
for a RM399 million project to build the Sultan Ahmad
Shah State Administrative Complex in KotaSAS
Township from the State Government of Pahang on
8 December 2014. Final decision on awarding the said
project is expected in the 2nd half of 2015.
If the development project of the new State
Administrative Complex of the State Government of
Pahang is not awarded to us or there is a delay in the
award of the said project to us, then the expected
returns to our shareholders for these project will not be
realised or may be affected.
DIVIDENDS
Following increase in Tanah Makmur’s earnings, a single
tier interim dividend of six (6) sen per share for the FYE
2014 was paid on 8 October 2014. This represented a
dividend payout of 44% against earnings.
For the FYE 2015, Tanah Makmur had declared a single
tier interim dividend of six (6) sen per share payable on
29 May 2015 which translated into a 4% dividend yield
based on the share price of RM1.50.
ACKNOWLEDGEMENT
On behalf of the Board of Directors, I would like to thank
the management and staff of Tanah Makmur Group for
their commitment and excellent dedication to the Group.
In addition, I would like to take this opportunity to
acknowledge the support, prudent counsel and valuable
insights extended to me by my fellow Board members
throughout the year. My heartfelt gratitude goes to the
newly appointed independent directors for their valuable
contribution to the Group.
I would also like to extend my sincere appreciation to our
business associates and partners, government
authorities and regulatory bodies, banker and legal
advisers. Finally, I am grateful for the unwavering support
of all our valued shareholders throughout the year.
Our hardwork, initiatives and efforts begun to bear fruit
as we achieved improved financial performance for the
FYE 2014. I look forward to the continued business
growth of Tanah Makmur Group delivering sustainable
returns to our shareholders.
Thank you.
YAM Tengku Tan Sri (Dr) Hajjah Meriam binti Sultan
Haji Ahmad Shah
Chairperson
IMPROVING
PEFORMANCE
THROUGH TRAINING
Our employees are constantly trained and motivated in
order for them to perform at their best.
BOARD OF
DIRECTORS
Board of
Directors
05
02
09
06
03
08
01
04
07
01 YAM Tengku Tan Sri Dr. Hajjah Meriam binti
Sultan Haji Ahmad Shah
Chairman, Non-Independent Non-Executive Director
02 YM. Tengku Dato’ Zubir bin Tengku Dato’ Ubaidillah
Managing Director
03 YM. Tengku Dato’ Sri Ahmad Faisal bin Tengku Ibrahim
04 YH. Dato’ Wan Bakri bin Wan Ismail
05 YBhg. Tan Sri Dato’ Sri Abdul Aziz bin Abdul Rahman
06 YH. Dato’ Cheong Keap Tai
07 YH. Dato’ Dr. Zaha Rina binti Zahari
08 YH. Dato’ Thavalingam a/l C. Thavarajah
09 Puan Darawati Hussain binti Dato’ Seri Abdul Latiff
Not in picture:
10 YM Tengku Dato’ Sri Uzir bin Tengku Dato’ Ubaidillah
Alternate Director to YM Tengku Dato’ Sri Ahmad
Faisal bin Tengku Ibrahim
11
Alternate Director to YH Dato’ Wan Bakri bin
Wan Ismail
DIRECTORS’
PROFILE
YAM Tengku Tan Sri (Dr) Hajjah Meriam binti
Sultan Ahmad Shah
Chairperson,
Non Independent Non-Executive Director
YAM Tengku Tan Sri (Dr) Hajjah Meriam binti Sultan Haji Ahmad Shah aged
60 is the Chairman and a Non-Independent Non-Executive Director of the
Company. Tengku Tan Sri (Dr) Hajjah Meriam was conferred an Honorary
Doctorate of Leadership in Social Development from Lim Kok Wing
University in 2013 for her distinguished social contribution. She started her
career as the Executive Vice Chairman of T.A.S Industries Sdn Bhd on
1 September 1990. She then joined the Board of Kurnia Setia Berhad on
27 June 2005 until 27 May 2011. Subsequent to the Privatisation of Kurnia
Setia, YAM Tengku Tan Sri (Dr) Hajjah Meriam assumed the positions of
Deputy Chairman of Tanah Makmur on 31 January 2011 and thereafter as
the Chairman on 24 September 2013. Currently, she also sits on the Board
of Directors of various private limited companies and several voluntary
organisations.
YAM Tengku Tan Sri (Dr) Hajjah Meriam attended all six (6) Board Meetings
of the Company held during the financial year ended 31 December 2014.
Directors’
Profile
YM Tengku Dato' Zubir bin
Tengku Dato' Ubaidillah
Managing Director
YM Tengku Dato' Zubir bin Tengku Dato' Ubaidillah aged 52 was
appointed to the Board on 27 October 2010 and has been the
Managing Director of the Company since 30 November 2010. He
graduated with a Bachelor of Science (Computer Science) from
California State University, Chico, USA in 1986. YM Tengku Dato’
Zubir started his career in 1986 with Petroliam Nasional Berhad
(“PETRONAS”) as an information system executive. He was then
promoted to the position of head of computer operation in
PETRONAS. In 1988, he joined the Road Builder (M) Holdings
Berhad’s group of companies as the Corporate Affairs Manager
and was appointed as their Group General Manager, property
division in 1994 to 1998. From 1998 to 2004, he was involved in
his own private businesses which include the construction of East
Coast Expressway, trading in construction materials and
quarrying. He joined Kurnia Setia Berhad on 1 July 2005 as the
General Manager of Corporate Development and on 1 January
2006 he was appointed as the Chief Operating Officer.
On 8 November 2008, he assumed the position of Managing
Director of Kurnia Setia Berhad. Subsequent to the Privatisation
of Kurnia Setia Berhad in 2010, YM Tengku Dato’ Zubir was
transferred to Tanah Makmur Berhad and assumed the current
position as the Managing Director of Tanah Makmur Berhad.
Currently, he is the Chairman, Executive Director and a director of
various subsidiaries within Tanah Makmur Group of Companies
and hold directorship in several private limited companies.
YM Tengku Dato’ Zubir attended all six (6) Board Meetings held
during the financial year ended 31 December 2014.
Directors’
Profile
YM Tengku Dato' Sri Ahmad Faisal
bin Tengku Ibrahim
YM Tengku Dato' Sri Ahmad Faisal bin Tengku Ibrahim aged 49
was appointed as a Non-Independent Non-Executive Director on
31 January 2011. Tengku Dato’ Sri Ahmad Faisal is a member of
the Remuneration and Nominating Committee. He is also the
Chairman of Kreatif Selaras Mining Sdn Bhd and a Director of
Tanah Makmur KotaSAS Sdn Bhd, subsidiaries of Tanah Makmur
Berhad. He graduated with a Bachelor of Science (Hons) Degree
from the London School of Economics, United Kingdom in 1988.
He began his career in 1988 as a dealers’ representative with RHB
Securities Berhad until 1990 and thereafter with PB Securities
Berhad from 1991 to 1995. He assumed the position as a Chief
Executive Officer in Kitaran Ventures Sdn Bhd from 1997 to 2000.
He also held directorships in ING Bhd from 1994 to 2012, Ekovest
Berhad from 1995 to 1998, Nanyang Press Holdings Berhad from
1996 to 2001, Putrajaya Perdana Berhad from 2008 to 2009 and
EON Capital Bhd from 2010 to 2011. Currently, he sits on the Board
of Directors of several private limited companies.
YM Tengku Dato’ Sri Ahmad Faisal attended all six (6) Board
Meetings of the Company held during the financial year ended 31
December 2014.
Directors’
Profile
YH Dato’ Wan Bakri bin Wan Ismail
YH Dato’ Wan Bakri bin Wan Ismail aged 60 was appointed as a
Non-Independent Non-Executive Director on 3 December 2013.
He is the representative from Lembaga Kemajuan Perusahaan
Pertanian Negeri Pahang (LKPP). He graduated with a Bachelor of
Social Science majoring in Political Science from Universiti Sains
Malaysia in 1994. He started his career with LKPP as a supervisor
in 1980 and was then promoted as Executive Administration
Officer in 1994. He was appointed as Administration Manager in
2002 and as Finance Manager in 2010. He assumed the position
of Deputy General Manager of LKPP in 2011 until his promotion to
the position of General Manager in 2014. YH Dato’Wan Bakri has
more than 30 years experience in agriculture industry primarily in
the field of oil palm. Currently, YH Dato’ Wan Bakri also sits on the
Board of Directors of Astral Asia Berhad, Far East Holdings
Berhad and hold directorship in various subsidiaries of LKPP.
YH Dato’ Wan Bakri attended five (5) out of six (6) Board Meetings
of the Company held during the financial year ended 31 December
2014.
Directors’
Profile
YBhg Tan Sri Dato’ Sri Abdul Aziz
bin Abdul Rahman
YBhg Tan Sri Dato’ Sri Abdul Aziz bin Abdul Rahman aged 69 was
appointed to the Board as an Independent Non-Executive Director
on 3 December 2013. Tan Sri Dato’ Sri Abdul Aziz is the Chairman
of the Remuneration Committee. He graduated with a Bachelor of
Commerce from University of New South Wales, Sydney, Australia
in 1970. He is a member of the Malaysian Institute of Certified
Public Accountants (MICPA) and the Malaysian Institute of
Accountants (MIA). He was a consultant with Price Waterhouse &
Co (Sydney) Australia from 1969 to 1972. He then joined Malaysian
Airlines System Berhad as Finance Manager from 1972 to 1981.
Soon after that, he assumed the position of Managing Director of
Bank Kerjasama Rakyat Malaysia Berhad (now known as Bank
Rakyat Berhad) from 1981 to 1982. He has served as Chairman and
Board member of several government institutions before venturing
into politics and public service as the Pahang State Assemblyman,
State Executive Councillor and Deputy Chief Minister of Pahang.
He was a Senator of Malaysian Parliament for a maximum period
of two terms. Tan Sri Dato’ Sri Abdul Aziz held directorship in the
Federal Land Development Authority (FELDA) from 1986 to 1991,
Chairman of Mentiga Corporation Berhad from 1989 to 1993 and
the Chairman of Far East Holdings Berhad from 1991 to 1994. In
the field of education, Tan Sri Dato’ Sri Abdul Aziz also sits on the
Board of University Malaysia Pahang and International Islamic
University Malaysia. Currently, Tan Sri Dato’ Sri Abdul Aziz sits
on the Board of Directors of Affin Islamic Bank Berhad, Chuan
Huat Resources Berhad, Asian Healthcare Group Berhad and
various private limited companies.
YBhg Tan Sri Dato’ Sri Abdul Aziz attended four (4) out of six (6) Board
Meetings held during the financial year ended 31 December 2014.
Directors’
Profile
YH Dato’ Cheong Keap Tai
YH Dato’ Cheong Keap Tai aged 66 was appointed to the Board as
an Independent Non-Executive Director on 3 December 2013. Dato’
Cheong is the Chairman of Audit Committee and also a member of
the Remuneration Committee. He graduated with a Bachelor of
Accountancy from the National University of Singapore in 1973. He
is a Chartered Accountant and a member of Malaysian Institute of
Accountants (MIA), a member of the Malaysian Institute of Certified
Public Accountants (MICPA) and a member of the Malaysia
Association of the Institute of Chartered Secretaries and
Administrators (MAICSA). He is also a member of the Chartered
Tax Institute of Malaysia (CTIM), a member of the Institute of Cooperatives Auditors and a Licensed Tax Agent. He began his career
as a member of the audit staff in Coopers & Lybrand, Malaysia in
1974 to 1986 and subsequently as the Executive Director and
Partner of Coopers & Lybrand in 1986 to 1988. Upon its merger
with Pricewaterhouse, he was the Executive Director and Partner
of PricewaterhouseCoopers and Chairman of the Governance
Board of PricewaterhouseCoopers until his retirement in
December 2003. He held directorship in Cement Industries of
Malaysia Berhad from 2001 to 2009, Opus Group Berhad from
2007 to 2009 and Opus International Group Plc from 2001 to
2007. Currently, he is a Partner of Ash’ari Cheong Chartered
Accountants and hold directorship in YTL Corporation Berhad, YTL
Land & Development Berhad, YTL e-Solutions Berhad, Gromutual
Berhad and several private limited companies.
YH Dato’ Cheong attended all six (6) Board Meetings of the
Company held during the financial year ended 31 December 2014.
Directors’
Profile
YH Dato’ Dr Zaha Rina binti Zahari
YH Dato’ Dr Zaha Rina binti Zahari aged 53 was appointed to the
Board as an Independent Non-Executive Director on 3 December
2013. Dato’ Dr Zaha Rina is a member of the Audit Committee. She
obtained her BA (Hons) Accounting and Finance from Leeds
Metropolitan University, United Kingdom in 1984, a Master of
Business Administration from University of Hull, United Kingdom
in 1991 and a Doctorate in Business Administration in 2002,
focusing on capital markets research and specialising in
derivatives from the same university. She started her career as a
finance executive in Sri Communication Engineering Sdn Bhd in
1984 and assumed the position of Director of Finance and
Administration in Sri Communication Group until 2000. Dato’ Dr
Zaha Rina has more than 20 years of experience in the financial,
commodities and security industry. She has previous Board
appointments at the Commodity and Monetary Exchange of
Malaysia (COMMEX) from 1993 to 1996 and assumed the position
of Chief Operating Officer (COO) of Kuala Lumpur and Financial
Futures Exchange (KLOFFE) and Malaysian Derivatives Exchange
(MDEX) in 2001. She was then appointed as the Head of
Exchanges, managing the operations of KLSE (now known as
Bursa Securities), MESDAQ, MDEX and Labuan International
Financial Exchanges in September 2003, prior to KLSE’s
demutualisation. In 2004 until 2006, she assumed the position of
Chief Executive Officer of RHB Securities Sdn Bhd. She was also
the consultant to Financial Technologies Middle East for the setting
up of Bahrain Financial Exchange (BFX) which was launched in
January 2009. Prior to this, she was with RBS Group in Singapore
from August 2007 to May 2008. She has been a director of MAA
Takaful Bhd from 2008 to 2012, EON Capital Bhd and EON Bank
Bhd from 2010 to 2011, MIMB Investment Bank Berhad from 2011
to 2013 and Zurich Insurance Malaysia Berhad from 2012 to 2013.
Currently, Dato’ Dr Zaha Rina sits on the Board of Directors of
Hong Leong Industries Berhad, Pacific & Orient Berhad, Manulife
Holdings Berhad and several other private limited companies.
Dato’ Dr Zaha Rina attended all six (6) Board Meetings of the
Company held during the year financial year ended 31 December
2014.
Directors’
Profile
YH Dato’ Thavalingam A/L C.
Thavarajah
YH Dato’ Thavalingam A/L C. Thavarajah aged 49 was appointed
to the Board as an Independent Non-Executive Director on 3
December 2013. Dato’ Thavalingam is the Chairman of Nominating
Committee and a member of the Audit Committee. He graduated
with a Bachelor of Law from Liverpool Polytechnic, United
Kingdom in 1988 and was subsequently called to the Bar at Gray’s
Inn, London, United Kingdom in 1989. He was then called to the
Malaysian Bar in 1990. He commenced his legal practice in Messrs
Shearn Delamore & Co after he was called to the Malaysian Bar.
He became a partner at Messrs Zaid Ibrahim & Co from 2000 to
2010. He is currently a partner with Messrs Lee Hishamuddin Allen
& Gledhill. He also sat on the board of director of Gading Sari
Aviation Services Sdn Bhd from 2010 to 2013. YH Dato’
Thavalingam had been appointed by the Government in 2008 to
serve on the National Labour Advisory Council for a two-year term.
He was also the honorary secretary of the Malaysian Employers
Federation from 2006 to 2011. He currently sits on the Editorial
Advisory Board of the Industrial Law Reports.
Dato’ Thavalingam attended all six (6) Board Meetings held during
the year financial year ended 31 December 2014.
Directors’
Profile
Darawati Hussain binti
Dato’ Seri Abdul Latiff
Puan Darawati Hussain binti Dato’ Seri Abdul Latiff aged 45 was
appointed to the Board as an Independent Non-Executive Director
on 9 June 2014. Puan Darawati Hussain is a member of the
Nominating Committee. She graduated with a Bachelor Degree in
Economics and Accountancy from Durham University, United
Kingdom in 1991 and a Master in Business Administration from
London Business School, United Kingdom in 1998. She had also
obtained the Chartered Financial Analyst (CFA) qualification in
2001. She started her career in 1991 as an Executive of Corporate
Finance/advisory with Commerce International Merchant Bankers
Berhad and subsequently left as a Manager in 1996. She then spent
five years from 1997 to 2001 in London where she was a European
Equities Portfolio Manager in Mondrian Investment Partners
Limited, a fund management company. In September 2001, she rejoined CIMB group to set up and develop the private equity arm,
where she was the Head of Private Equity and Venture Capital of
CIMB until August 2012, overseeing a private equity portfolio of
more than 50 companies that operate in different sectors and in
various stages of business maturity. Subsequently, she was made
head of Co-investor and Fund Relations of CIMB Group Strategy
and Strategic Investments (CIMB GSSI) until April 2014. Puan
Darawati Hussain is presently a business entrepreneur in
investment and property investment. Currently, she sits on the
Board of Director of Masterskill Education Group Berhad and
several other private limited companies.
Puan Darawati Hussain attended two (2) out of three (3) Board
Meetings held during the financial year ended 31 December 2014
subsequent to her appointment to the Board on 9 June 2014.
Directors’
Profile
YM Tengku Dato' Sri Uzir bin
Tengku Dato’ Ubaidillah
Alternate Director to YM Tengku Dato' Sri Ahmad Faisal bin Tengku Ibrahim
YM Tengku Dato' Sri Uzir bin Tengku Dato’ Ubaidillah aged 56 was
appointed to the Board as a Non-Independent Non-Executive
Director on 3 December 2013. He is an Alternate Director to
YM Tengku Dato’ Sri Ahmad Faisal bin Tengku Ibrahim. He
graduated with a Bachelor of Science (Hons) Degree in Civil
Engineering from the University of London, United Kingdom in
1983. He started his career in Jabatan Kerja Raya as the Design
and Research Section Geotechnical Engineer in 1983. He was then
promoted to the position of Assistant Resident Engineer under
Felda Unit of Jabatan Kerja Raya in 1984 until 1985. He joined Road
Builder (M) Sdn Bhd as a Director from 1988 to 1999 and he also
held the position of Director of Road Builder (M) Holdings Berhad
between 1992 and 2005. He was also the Director cum Group
Chief Executive officer of Malaysian Investment Corporation
Berhad from 1990 to 1993. He joined Kurnia Setia Berhad on 19
November 2004 as a non-executive Director, a nominee of HRH
Tengku Abdullah Ibni Sultan Haji Ahmad Shah. Subsequent to the
Privatisation of Kurnia Setia Berhad, YM Tengku Dato’ Seri Uzir
bin Tengku Dato' Ubaidillah was transferred to Tanah Makmur
Berhad and assumed the position of Executive Director of Tanah
Makmur on 1 January 2011. He resigned on 3 December 2013 from
his position of Executive Director of Tanah Makmur and on the
same day he was appointed as the Alternate Director to YM Tengku
Dato’ Sri Ahmad Faisal bin Tengku Ibrahim. Currently, he is a
director of Kumpulan Unik BBP Sdn Bhd, a position he holds since
1997, an Executive Chairman of WZ Satu Berhad and he also sits
on the Board of Directors of various private limited companies.
YM Tengku Dato’ Sri Uzir did not attend any Board Meeting of the
Company held during the financial year ended 31 December 2014
subsequent to his appointment as an Alternate Director.
Alternate Director to YH Dato’ Wan Bakri bin Wan Ismail
Non Independent Non-Executive Director
Tuan Haji Abdul Rahim bin Abdullah aged 54 was appointed to the
Board as a Non-Independent Non-Executive Director on 11
November 2014. He is an Alternate Director to YH Dato’ Wan Bakri
bin Wan Ismail, representing LKPP Negeri Pahang (LKPP). He
graduated with a Bachelor Degree in Agricultural Science from
University Putra Malaysia in 1984. He started his career in the
government sector in 1984 as an Agricultural Officer of Lembaga
Padi Negeri Pahang and in 1989 he joint LKPP as a Senoir
Agricultural Officer. He was then promoted to an Administrative
Officer grade N48 in 2011 and to grade N52 in 2013. Tuan Haji
Abdul Rahim was promoted to Deputy General Manager of LKPP
in 2014 until present. He sits on the Board of several subsidiary
companies of LKPP.
Tuan Haji Abdul Rahim did not attend any Board Meeting of the
Company held during the financial year ended 31 December 2014
subsequent to his appointment as an Alternate Director.
Directors’
Profile
1.
Family relationship with Director and/or Major Shareholder
Save as disclosed below, none of the Directors of the Company have any family relationship with the other Directors and/or major
shareholders of the Company or have any conflict of interest with the Company:
2.
a)
YAM Tengku Tan Sri (Dr) Hajjah Meriam binti Sultan Haji Ahmad Shah
(i) sisters to KDYTM Tengku Abdullah Ibni Sultan Haji Ahmad Shah; a major shareholder of the Company
(ii) director and shareholder of TAS Industries Sdn Bhd; a major shareholder of the Company
(iii) related to YM Tengku Dato’ Zubir bin Tengku Dato’ Ubaidillah and YM Tengku Dato’ Sri Ahmad Faisal bin Tengku Ibrahim
(iv) related to YM Tengku Dato’ Sri Uzir bin Tengku Dato’ Ubaidillah; an alternate director and major shareholder of the Company
b)
YM Tengku Dato’ Zubir bin Tengku Dato’ Ubaidillah
(i) related to YAM Tengku Tan Sri (Dr) Hajjah Meriam binti Sultan Haji Ahmad Shah and YM Tengku Dato’ Sri Ahmad Faisal
bin Tengku Ibrahim
(ii) brother to YM Tengku Dato’ Sri Uzir bin Tengku Dato’ Ubaidillah; an alternate director and major shareholder of the Company
(iii) related to KDYTM Tengku Abdullah Ibni Sultan Haji Ahmad Shah; a major shareholder of the Company
c)
YM Tengku Dato’ Sri Ahmad Faisal bin Tengku Ibrahim
(i) related to YAM Tengku Tan Sri (Dr) Hajjah Meriam binti Sultan Haji Ahmad Shah and YM Tengku Dato’ Zubir bin Tengku
Dato’ Ubaidillah
(ii) related to YM Tengku Dato’ Sri Uzir bin Tengku Dato’ Ubaidillah; an alternate director and major shareholder of the Company
d)
(i) representative of LKPP Negeri Pahang; a major shareholder of the Company
e)
YM Tengku Dato’ Sri Uzir bin Tengku Dato’ Ubaidillah
(Alternate Director to YM Tengku Dato’ Sri Ahmad Faisal bin Tengku Ibrahim)
(i) brother to YM Tengku Dato’ Zubir bin Tengku Dato’ Ubaidillah
(ii) related to YAM Tengku Tan Sri (Dr) Hajjah Meriam binti Sultan Haji Ahmad Shah and YM Tengku Dato’ Sri Ahmad Faisal
bin Tengku Ibrahim
f)
(Alternate Director to YH Dato’ Wan Bakri bin Wan Ismail)
(i) Representative of LKPP Negeri Pahang; a major shareholder of the Company
All the Directors are Malaysian and maintain a clean record with regards to convictions for offences within the past 10 years
VISIONARY PLANNING
ENSURES SUCCESS
Through detailed planning, we are able to ensure that KotaSAS will be
a flourishing township and self-contained community.
ADDITIONAL INFORMATION
FINANCIAL REPORT
ACCOUNTABILITY
BUSINESS REVIEW
NOTICE
KEY MANAGEMENT
YM. TENGKU DATO’
ZUBIR BIN TENGKU
DATO’ UBAIDILLAH
MR. TEH FOO HOCK
Managing Director
Chief Financial Officer
ALIAS BIN
AWANG
SUZILAH BT. HAJI
WAHID
General Manager,
Estate Development
Company Secretary
ABDUL RAZAK
BIN MD. YUSOF
MOHD AZMI
BIN BUSU
General Manager,
Finance & Accounts
Senior Manager,
Finance & Accounts
AZLAN SHAH
BIN MOHD YUSOH
Senior Project Manager
Key Management
TUMARAN BIN
WONGSO
ASHRAF
BIN ABBAS
Head of Human Resources
and Administration
Head of Corporate
Development
MOHD AZMAILI
BIN ISMAIL
KOTASAS SDN BHD
YM TENGKU AMIR
NASSER IBNI
TENGKU IBRAHIM
Head of Internal Audit
Head of KotaSAS,
Administration & Finance
SRI JELUTUNG PALM
OIL MILL SDN BHD
HISHAMUDDIN BIN
MOHD YUNUS
Head of Palm
Oil Mill Operations
MOHD FARIZAN
BIN MOHD DALIMI
Head of KotaSAS,
Technical Aspects &
Projects
PROFILES OF
KEY MANAGEMENT
YM Tengku Dato’ Zubir bin Tengku Ubaidillah is the Managing
Director of Tanah Makmur Berhad. For details of YM Tengku Dato'
Zubir bin Tengku Ubaidillah, please refer to page 21 of this Annual
Report.
Teh Foo Hock is the Chief Financial Officer and Joint Company
Secretary of Tanah Makmur Berhad. He is a member of the
Malaysian Institute of Certified Public Accountants and the
Malaysian Institute of Accountants (MIA) since 1996. He is also an
associate member of the Malaysian Institute of Taxation since 1997
and the Institute of Internal Auditors of Malaysia since 1999. He
started his career with the Messrs. Coopers & Lybrand (now
known as PricewaterhouseCoopers) (“PwC”) in 1985. He held a
few positions in PwC, including audit senior and audit supervisor.
He joined Kinsteel Berhad in May 1997 as a Group Accountant. In
2002, his job responsibility was expanded to include Head of
Treasury and held the role as a Joint Company Secretary of
Kinsteel Berhad from August 2012 to September 2013. On 1 May
2014, he joined Tanah Makmur Berhad and assumed his current
position.
Suzilah binti Haji Wahid is our Company Secretary. She pursued
the professional course of Institute of Chartered Secretaries and
Administrators in University Teknologi MARA and in 1985 furthered
the said course in London School of Accountancy, United Kingdom.
In 1992, she obtained her licence to act as Company Secretary
from the Companies Commissions of Malaysia and she is also an
associate member of the Malaysian Institute of Chartered
Secretaries and Administrators (MAICSA). She began her career
in 1987 with LKPP Negeri Pahang as the Group Company Secretary
where she served for more than 8 years. She subsequently joined
Kurnia Setia Berhad as the Group Company Secretary on
7 November 1995. Subsequent to the Privatisation of Kurnia Setia
Berhad in 2010, she was transferred to Tanah Makmur Berhad and
assumed her current position.
Abdul Razak bin Md Yusof is our General Manager, Finance and
Accounts. He graduated with a Diploma in Accountancy from
University Teknologi Mara in 1991 and obtained a Bachelor of
Accountancy (Honours) from the same university in 2000. He is a
member of the Malaysian Institute of Accountants (MIA) since April
2001. He started his career in 1978 with Syarikat Ladang LKPP Sdn
Bhd. He then joined Kurnia Setia Berhad in 1984 as a special grade
accounts clerk and in 1992 he was then promoted to an Account
Executive. In 1995, he was appointed as an Assistant Account
Manager and subsequently as Finance Manager in 2005. In 2008,
he was then promoted to a Senior Finance Manager. Subsequent
to the Privatisation of Kurnia Setia Berhad in 2010, he was
transferred to Tanah Makmur Berhad and assumed his current
position on 1 July 2011.
Alias bin Awang is our General Manager, Plantation. He graduated
with a Diploma in Planting Industry Management from University
Technology Mara in 1989 and in 2012 he obtained a Master of
Business Administration from University Utara Malaysia. He
started his career in 1990 with Golden Hope Berhad as a Cadet
Assistant Manager. In 1991, he then moved to Austral Enterprises
Berhad as an Assistant Manager. He later joined Kosma Plantation
Berhad from 1999 to 2002. He assumed the position of a Plantation
Manager of IOI Corporation Berhad from 2002 to 2006. He joined
Kurnia Setia Berhad as the Head of plantation development in
2006. Subsequent to the Privatisation of Kurnia Setia Berhad in
2010, he was transferred to Tanah Makmur Berhad and assumed
his current position on 1 July 2011.
Azlan Shah bin Haji Mohd Yusoh is our Senior Project Manager.
He graduated with a Bachelor of Science in Land Surveying and
Mapping Science from University of Newcastle-upon-Tyne, United
Kingdom in 1997. He began his career in 1997 with Highway
Development Corporation Sdn Bhd. In 2002 he joined Tastu Bina
Sdn Bhd as an Administration and Safety Manager. From 2002 to
2005, he was the Head of plant, machinery and equipment of BBP
Bina Sdn Bhd. He joined Kurnia Setia Berhad as the Project
Manager in 2006 and was promoted to the position of a Senior
Project Manager on 1 April 2010. He also holds directorships in
several subsidiary companies of Tanah Makmur Berhad.
Subsequent to the Privatisation of Kurnia Setia Berhad in 2010, he
was transferred to Tanah Makmur Berhad and assumed his current
position.
Profiles of
Key Management
Mohd Azmi bin Busu is our Senior Manager, Finance and
Accounts. He graduated with a Degree in Accountancy, University
Utara Malaysia in 1995. He is a member of the Malaysia Institute
of Accountants (MIA) since 2000. He started his career in 1996
with Automotive Manufacture Malaysia Sdn Bhd, a subsidiary of
DRB Hicom Bhd. In 2003, he assumed the position of an
Accountant with Pengangkutan Petikemas Sdn Bhd. In 2004, he
joined Kuantan Medical Centre Sdn Bhd, a subsidiary of TDM Bhd
until 2007. He then joined Kuala Terengganu Specialist Hospital
Sdn Bhd acting as General Manager from 2007 until 2009. He then
joined Prizams Petrochem Sdn Bhd and held position as a General
Manager until 2010. In 2011, he joined Tanah Makmur Berhad as
an Assistant Manager, Finance and Account and subsequently in
2012 he was promoted to Senior Assistant Manager. He was then
promoted to Finance and Account Manager in 2013 and
subsequently assumed the current position in January 2015.
Tumaran bin Wongso is the Head of Human Resources and
Administration. He graduated with a Bachelor of Applied Science
from Universiti Sains Malaysia in 1984. He began his career on
1 June 1985 with Syarikat Ladang LKPP Sdn Bhd as a Plant
Operating Officer. In 1993, he joined Kurnia Setia Berhad as a
Human Resources and Administration Manager. Subsequent to the
Privatisation of Kurnia Setia Berhad in 2010, he was transferred
to Tanah Makmur Berhad and assumed the current position.
Ashraf bin Abbas is the Head of Corporate Development. He
graduated with a Bachelor of Science in Business Administration
from California State University, Sacramento, USA in 1987. He
began his career with Kewangan Usaha Bersatu Berhad as Credit
and Marketing Officer in 1991. He joined Malaysia Building Society
Berhad in 1993 as a Branch Manager. He then joined Kurnia Setia
Berhad as an Audit Executive in 2002. From 2006 to 2009, he was
the Assistant Manager of corporate development and was
promoted to Corporate Development Manager on 1 April 2010.
was transferred to Tanah Makmur Berhad and assumed the current
position.
Mohd Azmaili bin Ismail is the Head of Internal Audit. He graduated
with a Bachelor of Management (Honours) from Open University,
Kuala Lumpur in 2006. He is an associate member of the Institute
of Internal Auditors Malaysia since September 1994. He began his
career in 1984 with Syarikat Ladang LKPP Sdn Bhd. In 1992, he
joined Kurnia Setia Berhad as a special grade accounts clerk and
was promoted to an Internal Audit Executive in 1995. In 2004, he
was then promoted to an Assistant Manager, Internal Audit.
was transferred to Tanah Makmur Berhad and promoted to the
current position in July 2011.
Mohd Farizan bin Md Dalimi is the Head of KotaSAS Sdn Bhd, in
charge of technical aspects and projects. He graduated with a
Bachelor of Civil Engineering from Universiti Teknologi Malaysia
in 2002. He began his career in 2002 with Kumpulan Unik BBP
Sdn Bhd as a Project Engineer until 2010. During his employment
with Kumpulan Unik BBP Sdn Bhd, he was involved in several
projects in relation to PLUS Expressways, East Coast Expressway
and project work under Jabatan Kerja Raya Malaysia. In July 2011,
he joined Tanah Makmur as the Project Manager and was
subsequently promoted to the current position in August 2011.
YM Tengku Amir Nasser Ibni Tengku Ibrahim is the Head of
KotaSAS Sdn Bhd, in charge of administration and finance. He
graduated with a Bachelor in Business and Marketing Management
from Oxford Brookes University, United Kingdom in 2008. He
interned with ING Funds in 2007 and was involved in promoting
financial products. In 2010, he joined Parish Capital Advisors
Europe LLP as a trainee. In January 2012, he joined Tanah Makmur
as the Project Manager. He was subsequently promoted to the
current position in January 2013.
Hishamuddin bin Mohd Yunus is the Head of Palm Oil Mill
Operations. He graduated with a Diploma in Mechanical
Manufacturing from Universiti Teknologi Mara in 1998 and a
Diploma in Palm Oil Milling Technology and Management from
Malaysia Palm Oil Board in 2003. He obtained a second grade
Steam Engineer Certification from the Department of Safety and
Health of Malaysia in 2005. He began his career in 2002 with
Kumpulan Guthrie Berhad as an Assistant Manager and was
promoted to the position of Mill Manager in 2006 under the same
company. In 2012, he joined Prosper Group of Companies as their
Mill Manager. In May 2013, he then joined Sri Jelutung Palm Oil
Mill Sdn Bhd, a subsidiary company of Tanah Makmur Berhad and
assumed the current position.
LOCATION OF
OPERATIONS
PERLIS
KEDAH
PENANG
KELANTAN
TERENGGANU
PERAK
PAHANG
PAHANG
SELANGOR
FEDERAL TERRITORY
NEGERI SEMBILAN
LEGEND
MALACCA
PLANTATION LOCATION
MILLING LOCATION
DEVELOPMENT LOCATION
JOHORE
BUSINESS ACTIVITIES OF
TANAH MAKMUR BERHAD
PLANTATIONS
The oil palm plantation business is our Group's core activity. Our oil
palm plantation actvities are carried out by Tanah Makmur Bhd,
Alur Gemilang Sdn Bhd, Alur Seri Sdn Bhd, Sri Jelutung Palm Oil Mill
Sdn Bhd and Alur Lestari Sdn Bhd. As of to date, our group have
13 plantation estates in the State of Pahang with a total land area of 17,969.06
ha comprising 11,633.19 ha that we own and 6,335.87 ha of LKPP - leased land.
Below are the statistics for our plantation divison.
TMB Group Total Hectare Statement as at 31 December 2014
No.
Items
2014 (ha)
2013 (ha)
1
Total Hectare
according to Land Title
17,969.06
7,969.06
2
Total Planted
15,363.47
13,529.57
3
Matured
10,424.85
11,387.71
4
Immature
4,938.62
2,141.86
Tanah Makmur Berhad
TMB Group FFB Production and Yield Per Hectare From 2011 to 2014
Year
Total FFB
(m/t)
Matured
Hectare
Yield/ha
(m/t)
2014
207,947.04
10,424.85
19.95
2013
232,605.06
11,387.71
20.43
2012
229,890.49
10,415.97
22.07
2011
240,183.82
10,107.00
23.76
Tanah Makmur Berhad
OIL MILL
Our oil mill operation is under Sri Jelutung Palm Oil Mill Sdn. Bhd.
(SJPOM). SJPOM is a 100% subsidiary of Tanah Makmur Berhad.
The principal activities of SJPOM are production of crude palm oil
(CPO) and cultivation of oil palms. At present SJPOM mill capacity is at
30tph. However, it is being upgraded to 45tph and the proceses is expected
to be completed in the 2nd quarter of 2015. Having our own palm oil mill,
we would have a better control over the milling process, which in turn will give
us a higher OER obtained from our palm oil mill, compared to the OER used in
determining the price paid for purchase of FFB. SJPOM began its operations in
July 2012.
Below are the performance statistics for SJPOM since it began its operation.
SJPOM Performance
Period
Year
FFB
(m/t)
CPO
(m/t)
PK
(m/t)
OER
(%)
KER
(%)
2014
225,741.86 45,072.26
13,482.75
19.97
5.97
2013
158,533.01
31,676.18
9,465.26
19.98
5.97
2012
69,820.95
14,243.39
3,564.25
20.58
5.14
(6 months)
Notes:
•
•
FFB - Fresh Fruit Bunches
CPO - Crude Palm Oil
•
PK - Palm Kernel
•
•
OER - Oil Extraction Rate
KER - Kernel Extraction Rate
Tanah Makmur Berhad
DEVELOPMENT
AND CONSTRUCTION
Our construction and development activities is under KotaSAS Sdn.
Bhd. The principal activities of KotaSAS are construction and property
development. KotaSAS was set up to develop TMB's 1,500 acres of TMB
existing plantation land known as Ladang Bukit Goh into a residential and
commercial properties. It is situated 13 minutes from Kuantan town. The
construction and development of the township began in 2010. We began our
property development with residential properties. Our initial commercial properties
was launched in December 2014.
Below are the KotaSAS sales statistics from 2011 to 2014.
Sales Report by Year
Year
Total Units
Total Units Sold
Sales Revenue
RM
Types*
2014
360
349
129,648,782.00
SSLH/SSSD/
SHOP
2013
348
278
100,998,480.00
DSLH/SSSD/
DSSD/2.5SSD
2012
171
216
59,541,766.00
SSLH/SSSD/
DSLH
2011
230
235
58,195,493.00
SSLH/SSSD
* Notes:
• SSLH - Single Storey Link House
• SSSD - Single Storey Semi Detached
• DSLH - Double Storey Link House
• DSSD - Double Storey Semi Detached
AUDIT
COMMITTEE REPORT
MEMBERS
The Audit Committee was established on 9 January 2014. The members of the Audit Committee during the financial year ended
31 December 2014 are as follows:
Chairman
(Independent Non-Executive Director)
Members
YH. Dato’ Thavalingam C. Thavarajah
TERMS OF REFERENCE
1.
Composition of Members
The Audit Committee (the Committee) shall be appointed by the Board of Directors from amongst their members and shall comprise
no fewer than three (3) members, all of whom must be Non-Executive Directors with a majority of them shall be Independent
Directors.
At least one member of the Audit Committee:
(a)
(b)
Must be a member of the Malaysian Institute of Accountants, he must have at least 3 years working experience and:
(i)
he must have passed the examinations specified in part 1 of the First Schedule of the Accountants Act 1967; or
(ii)
he must be a member of one of the associations of accountants specified in Part 11 of the First Schedule of the
Accountants Act 1967; or
fulfills such other requirements as prescribed or approved by Bursa Malaysia Securities Berhad.
No alternate director of the Board shall be appointed as a member of the Audit Committee.
The composition of the Audit Committee satisfy the requirements prescribed in paragraphs 15.09 and 15.10 of the Listing
Requirements. In the event of any vacancy in the Committee resulting in the non-compliance of sub-paragraph 15.09(1) of the said
requirements, the Company must fill the vacancy within three (3) months.
2.
Authority and Rights
The Committee shall have the following authorities as authorized by the Board:
(a) to examine or investigate any matter within its terms of reference;
(b) to seek or obtain any information relevant to its activities or investigation from employees of the Company and Group;
Audit
Committee Report
(c) to have the necessary resources which are reasonable to carry out its duties and is authorised to obtain such independent
professional advice as it considers necessary;
(d) to consider other matters as may be directed by the Board from time to time;
(e) to communicate directly or to convene meetings with the External Auditors, the officers carrying out the Internal Audit function
or both, excluding the attendance of other directors and employees of the Group whenever deemed necessary but at least
twice a year.
3.
Duties, Functions and Responsibilities
The Committee shall undertake the following duties, functions and responsibilities:
3.1 Financial Reporting
(a)
Review the quarterly financial results and annual financial statements prior to its recommendation to the Board for
approval which include:
•
changes in or implementation of major accounting policies and practices;
•
significant and unusual events;
•
the accuracy and adequacy of the disclosure of information essential to a fair and full presentation of the financial
affairs of the Company and the Group;
•
compliance with applicable approved accounting standards, other statutory and legal requirements and the going
concern assumption.
3.2 External Audit
(a)
Review the audit plan, scope of audit and audit report with the external auditors;
(b)
Review with the external auditors their evaluation of the system of internal controls, during the course of their audit,
including any significant suggestions for improvements and management’s response;
(c)
Recommend the nomination of a person or persons as external auditors and the audit fee;
(d)
Review any letter of resignation from the external auditors of the Company;
(e)
Review whether there is reason (supported by grounds) to believe that the Company’s external auditors are not suitable
for re-appointment;
(f)
Review any significant audit findings, reservations, difficulties encountered or material weaknesses reported by the
external auditors.
Audit
Committee Report
3.3 Internal Audit
(a)
Review the adequacy of the scope, functions, competency and resources of the internal audit functions and that it has
the necessary authority to carry out its work;
(b)
Review the internal audit programme, the results of the internal audit programme, processes or investigation undertaken
and whether or not appropriate action is taken on the recommendations of the internal audit function;
(c)
Review any significant audit findings, reservations, difficulties encountered or material weaknesses reported by the
internal auditors.
3.4 Related Party Transactions
(a)
Review any related party transaction and conflict of interest situation that may arise within the Company/Group and any
related parties outside the Company/Group including any transaction, procedure or course of conduct that raises
questions of management integrity.
3.5 Other Matters
4.
(a)
Carry out any other function that may be mutually agreed upon by the Committee and the Board which would be beneficial
to the Company/Group and ensure the effective discharge of the Committee’s duties and responsibilities;
(b)
Prepare an annual report to the Board that provides among other matters, a summary of the activities carried out by the
Committee during the year.
Meetings and Attendance
Meeting shall be held not less than four times a year and additional meetings are held as and when required. The External Auditors
may request a meeting if they consider the said meeting is necessary.
The majority of members present must be Independent Directors to form a quorum in respect of a meeting of the Committee.
The Chief Financial Officer, Senior Finance Manager and the Head of Internal Audit normally attend meetings. The Managing
Director and other Board members appropriate employees and external auditors may attend meetings upon the invitation of the
Audit Committee. The committee shall meet with the External Auditors without executive board members or management present
at least twice a year.
The Secretary of the Company, shall serve the Audit Committee as Secretary. The Committee may establish any regulations from
time to time to govern its administration.
Audit
Committee Report
SUMMARY OF ACTIVITIES OF THE AUDIT COMMITTEE
The Chairman of the Audit Committee reports regularly to the Board on the activities carried out by the Audit Committee in the discharge
of its duties and responsibilities as set out in the Terms of Reference.
The Audit Committee met at scheduled times with due notices of meetings issued and with agenda planned and itemised so that matters
were deliberated in a focused and detailed manner.
During the financial year 2014, the Committee held a total of five meetings. The details of attendance of each member at the Audit
Committee Meetings was as follows:
Audit Committee Members
Number of Meetings
Held
Attended
5
5
5
5
5
5
The Audit Committee met with the External Auditors without the presence of the Management twice during the financial year to discuss
any matters presented and had reported that there were no restrictions on the scope of their audit.
In line with the terms of reference of the Committee, the following activities were carried out by the Committee during the financial year
ended 31 December 2014:
1.
Financial Reporting
(a)
Reviewed the quarterly financial results for announcements to Bursa Malaysia Securities in compliance with the Financial
Reporting Standards before recommending them for Board’s approval;
(b)
Reviewed the annual audited financial statements with the External Auditors before recommending them for Board’s approval.
The review was inter-alia, to ensure compliance with:-
2.
provisions of the Companies Act, 1965;
Listing Requirements of the Bursa Malaysia Securities Berhad;
the updates of new developments on accounting standards issued by the Malaysian Accounting Standards Board.
External Audit
(a)
Reviewed the annual Audit Plan covering the nature and scope of audit strategy for the financial year;
(b)
Reviewed the results and issues arising from the audit by External Auditors for the financial year and the resolution of issues
highlighted in their report to the Audit Committee and the Management’s responses;
(c)
Reviewed and approved the External Auditors terms of engagement and evaluated the External Auditors’ performance before
recommending to the Board for re-appointment and their remunerations.
Audit
Committee Report
3.
4.
Internal Audit
(a)
Reviewed the annual Internal Audit Plan for the Group to ensure adequate coverage over the activities of the Company and its
respective subsidiaries;
(b)
Reviewed the internal audit reports which highlighted internal audit observations and recommendations relating to the
operations of the company and its subsidiaries. When necessary, the Committee has instructed Management to take corrective
actions to address the weaknesses raised in the said reports;
(c)
Reviewed the competency of the internal audit, including monitoring the progress of recruitment.
Reviewing Internal Controls
The effectiveness of the Company’s System of Internal Controls are reviewed periodically by the Audit Committee. The review
covers the financial, operational and compliance controls as well as Risk Management issues identified by the Internal Audit Division.
Where necessary, the Committee requested action to be taken by the Management to rectify and improve the System of Internal
Controls and procedures including measures to strengthen the estates management and suggestion for improvement, based on
the Internal Auditors recommendations and suggestion.
5.
Related Party Transactions
Assist to review all significant Related Party Transactions and Recurrent Related Party Transaction entered by the Group and the
Company, to ensure that such transactions are undertaken at arm’s length basis on normal commercial terms which are not
detrimental to the interest of the minority shareholders of the Company or possible conflict of interest situations within the Company
or Group.
6.
Annual Report
Reviewed the Audit Committee Report and Statement on Risk Management and Internal Controls and recommended to the Board
for approval prior to their inclusion in the company’s Annual Report.
7.
Training
During the financial year, the Audit Committee members attended various conferences, seminars and training programmes. The
trainings attended by the Committee members during the financial year ended 31 December 2014 is reported in the Statement on
Corporate Governance on pages 52 to 62 of this Annual Report.
Audit
Committee Report
INTERNAL AUDIT FUNCTION
1.
Role
The Internal Audit Department assists the Committee in the discharge of its duties and responsibilities. Its role is to assure that
the System of Risk Management and Internal Control is functioning as intended, identified any significant weaknesses, the impact
it could have and the actions to be taken to rectify them. The Internal Audit also provides an independent and objective assessment
of the adequacy and effectiveness of risk management and controls and Corporate Governance processes of the Group.
The Internal Audit carries out the audits of the various applications of the Estate Computer Systems. The Internal Audits Department
also provide the independent and objective reports on the estates and subsidiaries’ management, operations and accounting policies.
The Internal Audit Department provide reports directly to the Audit Committee on the effectiveness and the adequacy of the System
of Risk Management and Internal Controls to the AC.
The Head of Internal Audit is assisted by at least 5 internal audit executives and 1 clerk that made up the Internal Audit Department.
The internal audit annual Audit Plan and human resource requirements are prepared annually to ensure that the internal audit
function is adequately resourced with competent and proficient internal auditors and are approved by the Audit Committee.
2.
Activities
The Internal Audit Department conducted independent reviews of the Group’s operational activities. During the financial year, the
Internal Audit has undertaken the following main activities:
•
carried out audits according to the Audit Plan approved by the Audit Committee and reported the findings, recommendations
and management’s corrective action to the Audit Committee every quarterly
•
review of estates and mill performance, field conditions and follow-up audits to determine that correction actions have been
taken on the findings reported by the Internal Audit
•
formulated Internal Audit standard operation procedures based on careful planning and appraising the usefulness of Estate
Computer Systems (ECS) and Central Reporting Systems (CRS) of the Group
The Internal Audit had reported to the Audit Committee all their findings, recommendations and management responses thereto
and actions on material findings adequately addressed by the Management during the year.
The Group’s internal audit function is carried out by the In-House internal audit department and the expenses incureed in carrying
out its duties and responsibilities for the year 2014 is amounting to RM82,900.00.
STATEMENT BY THE BOARD
This Report is made in accordance with a resolution of the Board of Directors and approved at the Board Meeting dated 27 April 2015.
CORPORATE GOVERNANCE
STATEMENT
The Board of Directors of Tanah Makmur Berhad (the Company) is fully committed to ensure that an appropriate and sound practices in
Corporate Governance as set out in the Malaysian Code on Corporate Governance 2012 (the Code) are applied throughout Tanah Makmur
Berhad Group of Companies.
The Company was listed on the Main Market of Bursa Malaysia Securities Berhad on 17 July 2014 and up to the date of this statement, Tanah
Makmur Group (the Group) has been improving the Group’s policies, internal guidelines and processes. The Board is satisfied that the
Company and Group have complied with the principles and recommendations of the Code for the financial year ended 31 December 2015.
The Board is pleased to present the following statements, which outline the main corporate governance practices that were in place
throughout the financial year.
1.0 ROLES AND RESPONSIBILITIES
1.1
Functions of the Board and Management
Tanah Makmur Berhad is led by an effective Board which sets policies that will enable them to guide the Company to achieve
its goals. The Board is collectively responsible for the Group’s strategic plans, business performance, risk management,
internal controls and statutory matters.
The Board is responsible for the oversight and overall management of the Company. The Board has a fiduciary duty to act in
good faith and in the best interests of the Group.The executive director has direct responsibility and accountability for the
business operations. The executive director and non executive directors collectively bring a wide range of technical skills,
experience and independence in judgements and decision making to support the needs of the Group.
The Board has established functions and decisions which are reserved for the Board that maybe delegated to specific Board
committees and those which are delegated to the Management. There is a clear segretation between the roles and
responsibilities of the Chairman and Managing Director as set out in the Board Charter. The Chairman is responsible for the
leadership and governance of the Board, ensuring its effectiveness and assumes the formal role as the leader in chairing all
Board meetings and shareholders’ meeting.
The Managing Director is responsible for the day to day management of the business and operations of the Group and
implementation of Board strategies, policies and decisions. By virtue of his position as a Board member, he also acts as the
intermediary between the Board and Management. The Managing Director is assisted by a team of Management. Regular
reporting is made to the Board on the Company’s overall performance.
1.2 Roles and Responsibilities
The Board has wide responsibilities which include the following key responsibilities:
a)
Reviewing and adopting a strategic plan for the company
The Board plays an important and active role in the development of the Company’s strategy. Management presents to
the Board its strategy and business and regulatory plans for each financial year and such time necessary for any revision
thereon which are reviewed and discussed before being adopted.
Corporate Governance
Statement
b)
Overseeing the conduct of the business of the company
Management’s performance under the leadership of Managing Director, who kept the Board informed of the progress of
significant operational issues and their impact to the overall Company’s performance.
c)
Developing and implementing Investor relations programme and shareholder communication policy
The Company endeavours to build investor confidence through good Corporate Governance practices and have
communicated effectively to all stakeholders, covering shareholders institutional investors and the investing public and
others.
d)
Reviewing the adequacy and integrity of management information and internal control systems
The Board is responsible for maintaining a sound system of Risk Management and Internal Controls to safeguard the
shareholders’ investments and interests and the Group assets and for the reviewing of the adequacy and integrity of the
Company’s risk management and internal control systems.
Details of risk management and internal control systems and their effectiveness are stated in Statement on Risk
Management and Internal Controls.
e)
Sucession planning for senior management
The Nominating Committee is responsible for reviewing candidates for key management position. It is also responsible
for formulating nomination, selection and succession policies for members of the Board and Board Committees and key
management personnel.
1.3
Formalised ethical standards
The Board has adopted and adhered to the Code of Ethics, which sets out the standards of conduct expected from Directors.
The Code of Ethics for Directors includes principles relating to Directors’ duties, conflict of interest, prohibited activities and
dealings in securities.
1.4
Promoting Sustainability
The Group is conscious of the environment effects of the business and believe sustainability is important for the future
success of the Company and the Group and have operated their businesses responsibly in areas of environment, social and
economic. The Group is committed to maintain healthy relationships within its community.
1.5
Qualified Company Secretaries and Access to information
The Company Secretaries of the Company are qualified to act under Section 139A of the Companies Act 1965. The Board is
satisfied with the performance and support rendered by the Company Secretaries to the Board in the discharge of its functions.
The Company Secretaries ensure that all Board meetings are properly convened, and that accurate and proper records of the
proceedings and resolutions passed are recorded and maintained in the statutory register of the Company. The Company
Secretaries also keep abreast of the evolving capital market environment, regulatory changes and developments in corporate
governance through continuous training and update the Board regularly.
Statement
The Board is supported by the Company Secretaries in the discharge of its functions and able to access company information
in a timely and more efficient manner, thus improving Board performance. The Company Secretaries constantly advise and
updated the Board on statutory and regulatory requirements pertaining to their duties and responsibilities.
Complete and unrestricted access is provided to the Board, either collectively or in their individual capacities by Senior
Management on specific matters. The Directors may obtain independent professional advice in furtherance of their duties
whenever necessary at the Company’s expense.
1.6
Board Charter
The Board has formerly adopted a Board Charter taking consideration all the applicable laws, rules and regulations as well
as best practices to provide guidance to the Board in the fulfilment of its roles, duties and responsibilities. The Charter also
elaborates the fiduciary and leadership functions of Directors, division of responsibilities, powers demarcation, procedures
and serves as a primary reference for prospective and existing Board members and management.
The Board Charter is available on Tanah Makmur Berhad’s corporate website at www.tanahmakmur.com
2.0 STRENGTHEN COMPOSITION
2.1
Board Committees
In discharging its fiduciary duty, the Board is assisted by Board Committees which operate within the defined terms
of reference.
The Independent Directors are actively involved in various Board Committees and they provide independent assessment and
opinion. The following committees were established to assist the Board in the discharge of its duties and also to monitor
risks.
2.1.1 Audit Committee
(established in January, 2014)
The composition and terms of reference of this Committee together with its report are presented on pages 46 to 51 of
the Annual Report.
2.1.2 Nominating Committee
(established in January, 2014)
The Nominating Committee consist of the following:
Chairman
YH Dato’ Thavalingam a/l C. Thavarajah
Members
YM. Tengku Dato’ Sri Ahmad Faisal bin tengku Ibrahim
(Non-Independent Non-Executive Director)
Statement
The function of the Nominating Committee, amongst others, is to recommend to the Board candidates for directorships
or Board Committee members. In addition, the Committee reviews the profile of the skills and experience of each
individual director of the Board of Directors and various Committees and to assess the effectiveness of the Board
as a whole.
Annually, the Nominating Committee reviews the overall composition of the Board in terms of appropriate size, required
mix of knowledge, skills, experiences and core competencies and adequacy of balance between Executive Directors and
Independent Non-Executive Directors. As part of the recruitment process and annual assessment of directors, the
Nominating Committee will review the professionalism, integrity, honesty, competency, commitment, contribution and
performance and ensure no conflict of interest arises that would impair their ability to represent the interest of the
Company’s shareholders and stakeholders and to fulfill the responsibilities of a director.
The Nominating Committee also evaluated the effectiveness of the Board as a whole, the various Committees and
assessing the contribution of each individual director. Good and effective communications were established among
Board members and Board Committee members on official and unofficial basis and major policies and corporate
proposals are discussed and scrutinised before putting to a vote.
For the financial year ended 31 December 2014, the Committee held three (3) meetings. The Committee meets on a
need basis.
2.1.3 Re-Election of Directors
In accordance with the Articles 101 of the Company’s Articles of Association, all Directors who are appointed by the
Board are subject to re-election by the shareholders at the next Annual General Meeting held following their appointments.
Managing Director is also subject to re-election by rotation once every three (3) years to comply with Article 105 of the
Company’s Articles of Association.
Directors who are subject to re-appointment or re-election at the Annual General Meeting (“AGM”) will be assessed by
the Nominating Committee, whose recommendations will be submitted to the Board for decision, and thereafter to be
tabled to shareholders for approval at the AGM.
2.1.4 Remuneration Committee
The Remuneration Committee consists of the following:
Chairman
YBhg Tan Sri Dato’ Sri Abdul Aziz bin Abdul Rahman
Member
(Non-Independent Non-Executive Director)
With the recommendation from the Remuneration Committee, the Board, as a whole, determines the remuneration of
each Director. The Board is mindful that a fair remuneration is critical to attract, retain and motivate Directors of the
Company. The Company pays its Non-Executive Directors annual fees which are approved annually by the shareholders.
The Directors received allowances for each meeting that they attend. For the financial year ended 31 December 2014,
the Committee held two (2) meetings. The Committee keep abreast of the remuneration packages for Board Members to
ensure that they commensurate with the scope of responsibility held.
Statement
The main duties and functions of the Remuneration Committee include, amongst others to recommend to the Board the
policy framework for Directors’ remuneration as well as the terms of service of Executive Directors and Senior
Management of the Company, bonus plans for the Group and to execute other related functions to achieve the objective
of the establishment of the Remuneration Committee.
2.2 Recruitment and Annual Assessment of Directors
2.2.1 Gender Diversity Policy
The Board is aware of the gender diversity policy as set out in Recommendation 2.2 of the Malaysian Code on Corporate
Governance 2012.
The Company has appointed three capable and competent women directors with the combination of skill, experience
and strength in the qualities necessary to strengthen the composition of the Board.
2.3 Remuneration Policies
The Remuneration Committee carries out the annual review of the overall remunerations policy for Directors, Managing
Directors and Key Senior Management Officer whereupon recommendations are submitted to the Board for approval.
2.3.1 Non-Executive Directors
The Non-Executive Directors’ remuneration package reflects the experience, expertise and level of responsibilities
undertaken by the Non-Executive Directors.This enables the Non-Executive Directors to maintain independence
and impartiality in making decisions affecting the future direction of the Company. The remuneration of all Directors
is decided by the Board collectively after the review by the Remuneration Committee.
2.3.2Executive Directors
The remuneration for the Executive Director is generally set to provide market competitiveness to attract and retain
Executive Director of a good caliber to competently manage the Company. The basic salary of the Executive Director
is fixed for the year and any revision of the basic salary will be reviewed and recommended by the Remuneration
Committee and approved by the Board Members, taking into account the individual performance.
Details of Directors’ remuneration for the financial year ended 31 December 2014, distinguishing between Executive
and Non-Executive Directors are set out below:
Directors’ Remuneration
Executive Director
RM
Non-Executive Directors
RM
Total
RM
Annual Fees *
Salaries
Bonus
Allowances
Other emoluments
75,000
446,100
280,000
52,800
125,316
625,000
270,400
52,000
700,000
446,100
280,000
323,200
177,316
Total (RM)
979,216
947,400
1,926,616
Statement
Breakdown of Directors’ Remuneration for the financial year ended 31 December 2014, in successive bands of
RM50,000 which comply with Bursa Malaysia Listing Requirements are shown below:
Remuneration
Below RM50,000
RM50,001 - RM100,000
RM100,001 - RM150,000
RM150,001 - RM200,000
RM200,001 - RM250,000
RM950,001 - RM1,000,000
*
**
Number of Directors
1 **
3
4
1
1
The Annual Fees will be subjected to the approval at the Annual General Meeting
Dr Nicholas Langley Boden resigned on 12 May 2014.
3.0 REINFORCE INDEPENDENCE
3.1
Board Balance and Composition
Tanah Makmur Berhad has complied with the Best Practices in Corporate Governance embodied in Part 2 of the Malaysian
Code on Corporate Governance.
The Board is made up of a combination of Executive Director with intimate knowledge of the business and Non-Executive
Directors who contribute effectively to the proceedings of the Board. Under the Company’s Articles of Association, the number
of Directors shall not be less than two (2) and not more than fourteen (14).
As at the date of this statement, there are nine (9) members of the Board comprising the Chairman, who is a Non-Independent
Non-Executive Director, a Managing Director, five (5) Independent Non-Executive Directors and two (2) Non-Independent
Non-Executive Directors. The composition is in compliance with paragraph 15.02 of the Bursa Malaysia Securities Berhad
Listing Requirements.
Together, the Directors bring a wide spectrum of business acumen, financial experience, skills and perspective necessary to
carry out the Group’s business operations. The views of the Independent Non-Executive Directors on the Board carry
significant weight in the Board’s decision-making process. A brief profile and status of each Director is presented on pages
20 to 29 of this Annual Report.
3.2 Tenure of Independent Directors
The Code recommends that the tenure of an Independent Director should not exceed a cumulative term of nine (9) years.
However, an Independent Director may continue to serve on the Board upon reaching the 9 years limit subject to the
Independent Director’s re-designation as a Non-Independent Non-Executive Director. In the event the Board intends to retain
the Director as Independent after the latter has served a cumulative term of nine (9) years, the Board must justify the decision
and seek shareholders’ approval at general meeting.
As the date of this Statement, none of the Independent Directors has exceeded the 9 years independence tenure.
Statement
4.0 FOSTER COMMITMENT
4.1
Board Meetings
The Board holds at least six regular scheduled meetings annually with additional meetings for particular matters convened
as and when deemed necessary. At Board Meetings, performance and resources of the Group are being reviewed and
evaluated particularly in comparison to stated goals and budgets.
Special Board Meetings are convened between the scheduled meetings to consider urgent proposals or matters that require
expedition’s decision or deliberation by the Board. All the pertinent issues discussed at Board meetings in arriving at the
decisions and conclusions are properly recorded by the Company Secretaries by way of minutes of meetings.
The Directors’ commitment in carrying out their duties and responsibilities is affirmed by their attendance at the Board
Meetings held during the financial year ended 31 December 2014 as reflected below:
Name of Directors
Attendance at Board Meetings
(during the Directors’ tenure)
YAM Tengku Tan Sri (Dr) Hajjah Meriam binti Sultan Haji Ahmad Shah
6 out of 6
YM Tengku Dato’ Zubir bin Tengku Dato’ Ubaidillah
6 out of 6
6 out of 6
YBhg Tan Sri Dato’ Sri Abdul Aziz bin Abdul Rahman
4 out of 6
5 out of 6
6 out of 6
YH Dato’ Dr Zaha Rina binti Zahari
6 out of 6
YH Dato’ Thavalingam a/l C. Thavarajah
6 out of 6
Puan Darawati Hussain binti Dato’ Seri Abdul Latiff(2)
2 out of 3
Dr Nicholas Langley Boden(1)
2 out of 2
(1) Resigned on 15 May 2014
(2) Appointed on 9 June 2014
Statement
4.2 Directors’ Training
The Directors are mindful that they should receive appropriate continuous training and encourage to attend and will continue
to attend seminar and briefings in order to broaden their perspectives and that they keep abreast on various issues facing the
changing business environment and regulatory requirements.
All Directors have attended the Mandatory Accreditation Programme (MAP) prescribed by the Bursa Malaysia Securities Berhad.
Conferences, seminars and training programmes attended by the Directors during the financial year ended 31 December 2014
are as follows:
Name of Directors
Conferences, Seminars and Training Programmes
Date
YAM Tengku Tan Sri Dr Hajjah
Meriam binti Sultan Haji Ahmad
Shah
•
•
IPO Dialogue with Securities Commission
Mandatory Accreditation Programme
16 July 2014
27-28 August 2014
YM Tengku Dato’ Zubir bin
•
16 July 2014
YM Tengku Dato’ Sri Ahmad
Faisal bin Tengku Ibrahim
•
16 July 2014
YBhg Tan Sri Dato’ Sri Abdul
Aziz bin Abdul Rahman
•
•
Half Day Talk on Corporate Governance for Directors and
Senior Management
Advocacy Sessions on Corporate Disclosure for Directors
16 July 2014
18 August 2014
The 16th Malaysian Strategic Outlook Conference 2014
Open Office Pengurusan Kanan LKPP
One Day Seminar On Promoting WAQF As A Mainstream
Tool In The National Economic Policy
Pembangunan Individu Organisasi Berintegriti Dalam
Perkhidmatan Awam
11th ISP 2014 - Plantation Industry : Sustaining The
Competitive Edge
Symposium Kebangsaan Konservasi 2014 - Melestari
Khazanah Warisan Negara
Bengkel Perancangan Strategik LKPP Negeri Pahang 2015
- 2022
23 January 2014
17 March 2014
9 April 2014
•
YH Dato’ Wan Bakri bin Wan
Ismail
•
•
•
•
•
•
•
•
3 September 2014
19-20 May 2014
4-5 June 2014
23-24 June 2014
11-14 August 2014
4-7 September 2014
Statement
Name of Directors
Conferences, Seminars and Training Programmes
YH Dato’ Dr Zaha Rina binti
Zahari
•
•
•
•
•
Date
28th Asia-Pacific Roundtable
Corporate Directors Advanced Programme : Strategy & Risk
Global Economic Symposium (GES) 2014
A
Telecommunication/broadcasting
and
Content
Programme organise by Ministry of Communication &
Multimedia Malaysia
A Holistic Approach-Global Estate Planning for High-NetWorth Families
CEO Forum 2014
Ivey Asia Leadership Programme
Wealth Management-Private Banking, Investment Decisions
and Structured Financial Products
Equity Portfolio Strategy & Global Market Moving Events
2-4 June 2014
16 July 2014
27-28 August 2014
8 September 2014
17-19 September 2014
27 May 2014
•
•
•
•
Integrating Corporate Governance with Business Acumen
and Corporate Disclosur
National Tax Conference 2014
MIA International Accountants Conference 2014
Goods and Services Tax (GST) Training Course
Goods and Services Tax (GST) Training Course
YH Dato’ Thavalingam a/l
C. Thavarajah
•
•
•
16 July 2014
27-28 August 2014
3 September 2014
Puan Darawati Hussain binti
Dato’ Seri Abdul Latiff
•
•
•
16 July 2014
27-28 August 2014
3 September 2014
YM Tengku Dato’ Sri Uzir bin
(Alternate Director to YM
Tengku Dato’ Sri Ahmad Faisal
bin Tengku Ibrahim)
•
•
Advanced Corporate Tax Planning
16 July 2014
14 August 2014
Tuan Haji Abdul Rahim bin
Abdullah
(Alternate Director to YH Dato’
Wan Bakri bin Wan Ismail)
•
•
•
The 16th Malaysia Strategic Outlook Conference 2014
Open Office Untuk Pengurusan Kanan LKPP
One Day Seminar “Promoting Waqf As A Mainstream Tool
In The National Economis Policy”
Powering Organization Through Strategic Thinking
Simposium Kebangsaan Konservasi 2014 “Melestari
Khazanah Warisan Negara”
Konsultasi Pengurusan Teknologi Pertanian 2014
23 January 2014
17-18 March 2014
9 April 2014
•
•
•
•
•
•
•
•
•
•
23 September 2014
24 September 2014
12-14 October 2014
13 November 2014
20 November 2014
12-13 August 2014
4-5 November 2014
5-7 December 2014
12-14 December 2014
22-23 April 2014
11-14 August 2014
19-20 August 2014
17-18 December 2014
Statement
5.0 UPHOLD INTERGRITY IN FINANCIAL REPORTING
Financial Reporting
The Board aims to present a balanced, cleared and meaningful assessment of the Company and Group’s financial performance
and prospects in all their reports to the shareholders, investors and regulatory authorities. This assessment is provided in the
Annual Report through the Chairman’s Statement and the brief information on the Group of Tanah Makmur Berhad’s plantation and
downstream activities and on the property development activities.
A yearly Audit Planning Memorandum submitted by the Internal and External Auditors to the Audit Committee sets out an analysis
of the strength, weaknesses and opportunities of the Group which identifies and highlights the possible options that can be
implemented to mitigate the impact of any business risks.
a)
Audit Committee
The Group’s financial reporting and internal control system is overseen by the Audit Committee Chairman together with the
Audit Committee Members, which comprises of three (3) Independent Non-Executive Directors.
The Audit Committee meets quarterly and additional meetings are held as and when required. During the financial year ended
31 December 2014, a total of five (5) Audit Committee meetings were held.
The Audit Committees Term of Reference and activities are summarised in the Report on the Audit Committee as stated on
page 46 to 51 of this Annual Report.
b)
Internal Auditors
The Internal Audit function is independent of the activities, they audit proficiently and with due professional care. The Internal
Audit Review highlights major weaknesses in control procedures and makes recommendations for improvements.
The statement of Internal Controls is set out on page 63 to 65 of the Annual Report.
c)
External Auditors
The External Auditors fill an essential role for the shareholders by enhancing the reliability of the Group's financial statements.
The External Auditors have an obligation to bring any significant weaknesses in the Group’s system of control and compliance
to the attention of the Management and if necessary to the Audit Committee and the Board.
The Audit Committee (AC) undertook an annual assessment of the suitability and independence of the external auditors in
accordance with the independence criteria set out by the Malaysian Institute of Accounts. Having assessed their performance, the
AC will recommend their re-appointment decision to the Board, upon which the shareholders’ approval will be sought at the Annual
General Meeting.
Statement
6.0 RECOGNIZE AND MANAGE RISK
6.1
Sound Framework To Manage Risk
The Company continues to maintain and review its internal control procedures to ensure, as far as possible, the protection of
its assets and its shareholders’ investments.
6.2 Internal Audit Function
The Board has established an internal audit function within the Company, which is led by the Head of Internal Audit who
report directly to the Audit Committee.
Details of the Company’s internal control system and framework are set out in the Statement on Risk Management and Internal
Control and Audit Committee Report of this Annual Report.
7.0 ENSURE TIMELY AND HIGH QUALITY DISCLOSURE
7.1
Corporate Disclosure Policy
The Board recognizes the importance of keeping investors informed of the group’s business and corporate developments.
Tanah Makmur Berhad always strive to make timely public announcement through the Bursa Malaysia of all major
developments within the Group.
8.0 STRENGTHEN RELATIONSHIP WITH SHAREHOLDERS
8.1
Encourage shareholder participation at General Meeting
Tanah Makmur Berhad recognizes the importance in promoting an effective communications channel with its shareholders.
An effective communications are aimed to provide its shareholders with transparent and accurate information of the Group’s
financial performance and position. The comprehensive Annual Report of the Company is printed in English and Bahasa
Malaysia.
The Annual General Meeting is the principal avenue for dialogue and interaction with the shareholders of the Company. Every
opportunity is given to the shareholders to ask question and seek clarification on the business and performance of the Company
and Group.
COMPLIANCE STATEMENT
Tanah Makmur Berhad complies with the disclosure guidelines and regulations of Main Market Listing Requirements Bursa Malaysia
Securities Berhad and the Statement on the Company’s Corporate Governance practices is made in compliance with Paragraph 15.25
and 15.08A of the Main Market Listing Requirement.
This statement was approved by the Board on 27 April 2015.
STATEMENT ON RISK MANAGEMENT AND
INTERNAL CONTROLS
The Board of Directors of Tanah Makmur Berhad is pleased to provide the following Statement on Risk Management and Internal Controls
which outlines the scope and internal controls of Tanah Makmur Group for the financial year ended 31 December 2014. This statement
is issued pursuant to paragraph 15.26 (b) of the Main Market Listing Requirements Bursa Malaysia Securities Berhad.
The Board, the Management and all level of employees understand the importance of an effective internal control system to the
organisation. The Company and its subsidiaries continuously identify, evaluate and monitor risks that could affect the Group.
BOARD RESPONSIBILITIES
The Board acknowledges its responsibility for maintaining a sound system of risk management and internal controls within the organisation
and its effectiveness to safeguard the shareholders’ investment and the Group’s assets. The Group’s system of internal controls can only
reduce but not eliminate the possibility of poor judgement in decision making, human errors and the occurrence of unforeseeable
circumstances. Internal controls can only provide reasonable but not absolute assurance against material misstatement or losses.
The instituting of such internal controls are implemented through the conduct of internal audits on a regular basis on all operating units,
estates and subsidiaries within the Group, the internal control system of the estates through the Central Reporting System and the
Estate Computer System and implementation of various risk management policies and procedures.
The Audit Committee supports the Board oversight function on risk management and internal controls and assisted in identifying and
assessing the risks and reviewed the procedures of internal controls to mitigate and control these risks.
Management is responsible for implementing the Board’s framework, policies and procedures on the risk and internal controls.
The Group’s internal control systems are operating adequately and effectively in all material aspects throughout the financial year ended
31 December 2014.
INTERNAL CONTROL PROCESSES
The Internal Audit function is provided by the Internal Audit Department of the holding company, Tanah Makmur Berhad based on the plan
approved by the Audit Committee to undertake regular and systematic review of the risk management and internal controls processes to
provide the Audit Committee with sufficient assurance that the systems of internal controls are effective in addressing the risk identified.
The review of the internal control is an on-going processes with all the senior management members within the Group and is
co-ordinated by the Internal Audit Department which reported periodically to the Audit Committee.
•
Audit Committee
The Audit Committee assisted in the review of the effectiveness of the Company’s system of internal controls periodically.
The review covers the financial, operational and compliance controls as well as risk management issues identified by the Internal
Audit Department. The Audit Committee meet every quarter to discuss matters raised by the Management of Tanah Makmur Group
on business and operational matters including potential risk and control issues.
The Audit Committee has full and unimpeded access to both the Internal as well as the External Auditors.
Statement On Risk Management And
Internal Controls
•
Internal Audit
The Internal Audit Department is a separate department independent of the Management and it assists the Audit Committee in the
discharge of its duties to review and monitor the internal control procedures. Its main function is to carry out the operational audits
of the Group’s activities carried out by the various entities to assess the effectiveness of the internal controls procedures that are
in place so that an effective and efficient internal control system can be maintained.
The Internal Audit Department conducts audit visits to all estates, the mill, housing project sites of the Company and subsidiary
companies on a regular basis and report their findings to the Audit Committee on a quarterly basis. Internal audit also conducts
subsequent follow-up work to check that Management has dealt with the recommendations satisfactorily.
• Management
Management is responsible to implement the Board’s policies on risk, control and to uphold all good corporate governance
and practices.
The Managing Director is duly entrusted with the day-to-day management of the Group’s affairs, assisted by senior members of
the management from various departments to ensure effective management and supervision of all activities of the Group and in
particulars on the plantation and property operations.
The Group’s performance is monitored through a budgeting system that requires the management to identify and evaluate all risks
and all material variances to be identified and investigated monthly by the Management for appropriate corrective measures to
be taken.
Various sub-Committees within the Management have been set up such as the tender committee and foreign workers committee.
Experienced key personnel are appointed to the various sub-committees with appropriate empowerment to ensure effective
management and supervision of business operations.
The Group’s guidelines for hiring and termination of staff, rewarding remuneration and benefits, performance appraisals and other
human resource procedures are set up in the Service Circular (Pekeliling Perkhidmatan) to ensure that staff have proper guidelines
in carrying out their responsibilities.
Operational policies are documented in operations manuals such as the Estates Operation and Financial Manual which are
continuously revised and updated to meet operational needs. Operating policies, procedures, memorandum and circulars are
continuously updated and documented and form an integral part of the internal control system.
RISK MANAGEMENT
The Board is satisfied that the process of identifying, evaluating and managing of the significant business risks encountered by the
Group is generally in place and has been carried out satisfactorily as an on-going process by the Management to improve the effectiveness
of the internal controls system. The Board is also committed to improve the existing processes by which risks are identified, assessed
and controlled through its numerous committees.
Statement On Risk Management And
Internal Controls
ADEQUACY AND EFFECTIVENESS OF RISK MANAGEMENT AND NTERNAL CONTROLS
The Audit Committee, the Internal Audit function of the Group and the Management have provided the Board with assurance that the
group risk management and internal controls are operating adequately and effectively, in all material aspect.
Taking into consideration the assurance from the Audit Committee and the Management Team, the Board is of the view that the system of
risk management and internal controls is in place for the year under review and is sound and adequate to safeguard the group’s assets.
REVIEW OF THE STATEMENT BY EXTERNAL AUDITORS
The External Auditors have reviewed this statement and have reported to the Board that the statement appropriately reflects the
processes that the Board has adopted in reviewing the adequacy and integrity of the system of internal controls.
This statement is made in accordance with a resolution of the Board of Directors dated 27 April 2015.
CORPORATE SOCIAL
RESPONSIBILITY
Caring for our community …………………
A company’s performance should be measured not just according to the economic value it has created but also its impact on society
and the environment.
The Board of Tanah Makmur Berhad (Tanah Makmur) acknowledges the importance of Corporate Social Responsibility (CSR) as an
extension of the group’s efforts in fostering a strong corporate governance culture.
Caring for our Environment
We are mindful that some aspects of the plantation and
mill management could have environmental and
conservation impacts. As such, prior to any expansion
of our plantation and mill operations, we will undertake
an assessment to identify any potential negative impact
on the environment in our day to day operations.
To create awareness of the effects of deforestation,
Tanah Makmur practices environmentally friendly
methods such as zero burning within the estates for
clearing of new land for new planting or clearing old oil
palms for replanting programme where cut oil palm
fronds will be stacked across slopes to prevent soil
erosion and empty fruit bunches to be used as organic
fertilizers or compost.
We do not permit any sewage and liquid effluent
generated from site activities to flow from the site onto
any adjoining land or allow any waste matter to be
deposited anywhere within the site or any adjoining land.
Our priorities are the preservation and protection of
waterways. Areas are set aside as water catchments in
all our plantations to supply operational needs.
Corporate Social
Responsibility
Charity
The Company endeavour to contribute to the society and play a role as a caring corporate citizen in the community through donations
and sponsors to the disabled, orphanage, sports associations and among others the Sultan Ahmad Shah Environmental Trust, the Bakasa
Children’s Charity and recently to the Pahang flood victim. Donations were also made to schools for their building funds and sports day.
Education
The Company contributed annually to schools in the vicinity of our estates for Parent Teachers Association funds, under the programs
for excellence examination results. Free transportation is provided for school going children to the nearest schools. We also contributed
to Yayasan Istana Abdul Aziz and Akademi Menara Gading, a non-profit organisation that also conduct classes for the disadvantaged
students at learning centres and students at rural areas.
Employee Welfare
The Group continues to place high emphasis on developing its human capital. As at 31 December 2014, the Group has a total of 1,519
workforce. The workforce consist of 29% Malaysian and 5.8% of female. As a progressive and equal opportunity employer, we thrive
on meritocracy, empowering woman who make up 1.5% of the group’s management and rewarding individuals based on their knowledge,
capability and contributions to the Group.
The Group has embarked on refurbishment of its workers’ quarters, provide free/subsidised electricity and free water supplies to the
employees in the estates and mills with objective of providing the residents with better living conditions. The health and safety of all our
employees are also our priority. We are committed in ensuring a healthy and safe workplace for our employees and the general public.
The Group also covers Group Personal Accidents insurances for all its employees and Foreign Workers Compensation Scheme for the
foreign workers.
The needs of staff should not be overlooked whilst the group carried out the CSR activities, we also have in place funds for our employees
and their immediate family members for educational purposes and natural disaster.
…………… CSR will be an on-going commitments
ADDITIONAL
COMPLIANCE INFORMATION
The information set out below is disclosed in compliance with the Main Market Listing Requirements of Bursa Malaysia Securities
Berhad (Bursa Malaysia):
1.
Utilisation of Proceeds Raised from Corporate Proposals
On 17 July 2014, the Company successfully listed its entire issued and paid up capital on the Main Market of Bursa Malaysia
Securities Berhad. The status of utilization of proceeds raised from the Initial Public Offering as at 31 March 2015 are as follows:
Timeframe
utilisation of
proceeds
Amount of
total
proceeds
raised
RM
Amount of
total
actual
actual
utilisation
RM
within 24 months
within 24 months
within 24 months
within 6 months
within 6 months
28,500,000
5,000,000
13,000,000
13,075,000
5,600,000
16,007,500
1,295,575
13,075,000
5,600,000
65,175,000
35,978,075
Details of utilisation of proceeds
Estate development
Expansion of palm oil mill
Infrastructure work of the KotaSAS Township
Repayment of bank borrowings
Listing expenses
Total gross proceeds
Disclosed in accordance with Appendix 9C, Part A, item 13 of the Listing Requirements of Bursa Malaysia.
2.
Share Buybacks
There were no shares bought back by Tanah Makmur during the year.
Disclosed in accordance with Paragraph 12.23 Appendix 12D of the Listing Requirements of Bursa Malaysia.
3.
Options, Warrants or Convertible Securities
No options or convertible securities were issued by Tanah Makmur during the financial year ended 31 December 2014.
4.
American Depository Receipt (ADR) or Global Depository Receipt (GDR) Programme
Tanah Makmur did not sponsor any ADR or GDR programme during the financial year ended 31 December 2014.
Additional
Compliance Information
5.
Sanctions and/or Penalties
There were no material sanctions and/or penalties imposed on Tanah Makmur and its subsidiary companies, directors or
management by the relevant regulatory bodies, which were made public during the financial year ended 31 December 2014.
6.
Non-audit fees
The amount of non-audit fees incurred for services rendered to the Company and its subsidiaries for the financial year ended
31 December 2014 by the Company’s external auditors was RM248,500.00.
7.
Variation in results
There is no variance between the audit results for the financial year and the 4th Quarterly results previously announced.
The company did not release any profit estimate, forecast or projections for the financial year.
8.
Material Contracts
Save as disclosed below, our Company and our Subsidiaries have not entered into any contract with parties outside of our Group:
8.1
Our wholly-owned Subsidiary, KotaSAS Sdn Bhd (“KotaSAS”) entered into a shareholders’ agreement dated 1 April 2013
which was subsequently substituted by the amended restated shareholders’ agreement dated 12 May 2014 (“Shareholders’
Agreement”) with Tanah Makmur Perkasa Sdn Bhd (“Tanah Makmur Perkasa”) to govern the relationships of both parties as
shareholders of Tanah Makmur KotaSAS Sdn Bhd (“Tanah Makmur KotaSAS”), the entity that carries out the development
project on certain portion of all those parcels of 99-year leasehold land located in Bukit Goh, Kuantan, Pahang measuring in
total approximately 1,500 acres that has yet to be developed (“Development Project”).
YM Tengku Dato’ Sri Ahmad Faisal bin Tengku Ibrahim , is our Director and a Director and major shareholder of Tanah Makmur
Perkasa Sdn Bhd.
8.2 KotaSAS and Tanah Makmur KotaSAS had entered into a development agreement dated 8 January 2014 which was
subsequently substituted by the amended restated development agreement dated 12 May 2014 (“Development Agreement”)
to formalise the arrangement of the Development Project. Tanah Makmur KotaSAS being the master developer shall complete
the launching of the Development Project within a period of five years only from 1 April 2013.
Additional
Compliance Information
8.3 Bauxite mining works agreement dated 10 January 2014 between Kreatif Selaras Mining Sdn Bhd (Kreatif Selaras Mining)
and SE Satu Sdn Bhd (SE Satu) whereby Kreatif Selaras Mining has appointed Se Satu as the exclusive operator for the
mining and extraction of bauxite on parcels of land identified in the agreement, and to carry out processes for the production
of bauxite for sale and all operations and activities related or incidental, at a transaction value of RM80,437,500.00 (Provisional
Aggregate Sum) payable to SE Satu. The Provisional Aggregate Sum is provisional only and subject to the following
assumptions: (i) the relevant consents for the purpose of mining the bauxite are obtained and remain valid for the duration
of the contract, which is for a period of 36 months; (ii) Se Satu will extract 50,000 metric tonnes (minimum) of bauxite ore
per month for the duration of the contract, provided always that the bauxite reserves shall remain available on the parcels of
land identified in the agreement throughout the duration of the contract, and has not been exhausted in full at any time prior
to the expiry of the duration of the contract; (iii) SE Satu shall receive USD13.75 (or its equivalent in RM) per metric tonnes
based on the actual tonnage of washed bauxite that has been successfully sold and paid for in full by the buyers in each month
subject to and conditional upon the bauxite being sold at the pegged price stipulated in the agreement; and (iv) the currency
exchange rate of USD1 : RM3.25.
SE Satu remaining 49% equity interest is held by WZ Satu Berhad, a listed company on Bursa Malaysia Securities. YM Tengku
Dato’ Sri Uzir bin Tengku Dato’ Ubaidillah is our major shareholder and Alternate Director to YM Tengku Dato’ Sri Ahmad
Faisal bin Tengku Ibrahim is also the Chairman and major shareholder of WZ Satu Berhad.
Disclosed in accordance with Appendix 9C, Part A, item 21 and 22 of the Listing Requirements of Bursa Malaysia.
9.
Recurrent Related Party Transactions of a Revenue or Trading Nature
In addition to the recurrent related parties information disclosed elsewhere in the financial statements, the following significant
transactions between the Group and related parties took place at terms agreed between the parties during the financial year:-
FFB supplied from LKPP Corporation Sdn Bhd to
Sri Jelutung Palm Oil Mill Sdn Bhd
Note:
2014
RM
2013
RM
3,690,606
9,739,950
LKPP Corporation Sdn Bhd is a wholly–owned subsidiary of LKPP Negeri Pahang which is a major shareholder of
our Company.
Disclosed in accordance with Paragraph 10.09 of the Listing Requirements of Bursa Malaysia.
FINANCIAL
CALENDAR
Financial Year End 31 December
Announcement of Quarterly Results
•
•
•
•
•
First quarter ended 31 March 2014
Second quarter ended 30 June 2014
Third quarter ended 30 September 2014
Fourth quarter ended 31 December 2014
First quarter ended 31 March 2015
10 July 2014
25 August 2014
21 November 2014
25 February 2015
27 April 2015
2014 Annual Report
•
•
Date of Notice
6th Annual General Meeting
22 May 2015
16 June 2015
Dividends
Financial Year Ended 2014
First
Single Tier Interim Dividend of 6 sen per share
•
•
•
Notice
Entitlement
Payment
25 August 2014
10 September 2014
8 October 2014
Financial Year Ended 2015
First
Single Tier Interim Dividend of 6 sen per share
•
•
•
Notice
Entitlement
Payment
27 April 2015
13 May 2015
29 May 2015
STATEMENT OF DIRECTORS' RESPONSIBILITY IN RESPECT OF THE
ANNUAL AUDITED FINANCIAL STATEMENTS
pursuant to paragraph 15.26 (a) of the Main Market Bursa Malaysia Listing Requirements
The Board of Directors are responsible for ensuring that the annual financial statements of the Group are drawn up in accordance with
the requirements of the applicable approved accounting standards in Malaysia and the provisions of the Companies Act, 1965.
The Directors consider that, in preparing the financial statements of Tanah Makmur Berhad for the financial year end 31 December 2014
submitted by the External Auditor and which has been reviewed by the Audit Committee sets out on pages 46 to 51 of the printed version
of this Annual Report, the Company has used appropriate accounting policies; consistently applied and supported by reasonable and
prudent judgements and estimates. The Directors also consider that all applicable approved accounting standards in Malaysia have been
followed and confirm that the financial statements have been prepared on a going concern basis.
The Directors are responsible for ensuring that the Company keep accounting records which disclose with reasonable accuracy at any
time and give a true and fair view of the state of financial affairs of the Group.
The Directors are also responsible for taking such steps that are reasonably open to them to safeguard the assets of the Group and to
prevent and detect fraud and other irregularities.
The auditors' responsibilities are stated in their report to the shareholders.

OPTIMIZING OPPORTUNITIES - Tanah Makmur Berhad

Transcription

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