Growing - Bursa Malaysia Stock

Transcription

Growing
with
ANNUAL REPORT 2016
Growing
with
IVORY
CONTENTS
03
32
61
Corporate
Structure
Chairman's
Message
Financial
Statements
Growing
with
04
35
148
ANNUAL REPORT 2016
Corporate
Information
Board of
Directors
Group
Properties
05
38
150
ON THE COVER:
Projects
Key Senior
Management
Analysis of
Shareholdings
41
153
Corporate
Governance
Statement
Analysis of
Warrantholdings
The tree is a symbol that
many can identify with easily;
and that is what IVORY aims
to be - an organisation
that identifies with its
shareholders, employees
and the people. Resilient
and resourceful, IVORY
has built strong roots on
solid ground. The trunk
represents our core values
and strengths while the
branches
signify
our
diversification
upward
and outward. Lush leaves
and new buds are the new
products that we continually
seek to offer. Like a tree,
IVORY speeds up growth
in the right conditions, and
blooms with hard work.
16
Awards and
Achievements
18
Calendar
of Events
22
Corporate Social
Responsibility
30
Media
Highlights
54
Audit
Committee
Report
57
Statement on Risk
Management and
Internal Control
60
Additional
Compliance
Information
156
Notice of Annual
General Meeting
Enclosed
Proxy
Form
Just as a tree responds to its
surroundings, IVORY is swift
to react when opportunities
are present and prudent
in times of adversity. The
colour of the tree on the
cover reflects the colour of
IVORY and stands for the
sustainability of our growth
year after year.
02
IVORY PROPERTIES GROUP BERHAD (673211-M)
Ivory Properties Group Berhad
is a company listed on the Main Market of Bursa Malaysia
Securities Berhad since 28 July 2010. Ivory Properties Group
Berhad and its subsidiaries ("The Group"), which is principally
involved in property development, was established in 1999
and has since grown into an established and reputable
property developer in Penang and Northern Malaysia.
The Group’s project portfolio includes medium to highend apartments, luxury condominiums, semi-detached
and bungalows, boutique gated communities, retail and
commercial units.
Having won various awards in
recognition of the Group’s effort, the
Group has been continuing its winning
streak until today. The recent awards
are the CSR Malaysia Awards 2016
- Company of the Year Award under
Sustainability Excellence Category, the
Asia Pacific Property Awards which Ivory
Tower received the Highly Commended
award under the Office Achitechture for
Malaysia Category, the StarProperty.
my Awards 2016 where Moonlight Bay
earned the Excellence prize in The
Niche & Unique Award Category, the
South East Asia Property Awards where
The Latitude located at Mount Erskine
received the Highly Commended award
under the category of Best Mid-Range
Condo Development (North Malaysia)
while Tropicana Bay Residences was
awarded Highly Commended award
under the category of Best Luxury
Condo Development (North Malaysia).
The Group took the time and effort to nurture a verticallyintegrated range of in-house expertise and capabilities
including architecture, engineering, construction, interior
design, model making, sales and marketing, graphics and
multimedia and property management.
The vertical-integration enables the Group to effectively control
the construction process, thus ensuring cost control and
efficient use of resources. The Group establishes a dominant
reputation and branding as a premium property developer that
consistently delivers the best for its customers.
annual report 2016
03
CORPORATE STRUCTURE
as at 27 June 2016
Investment holding and provision of management and marketing services
100%
100%
100%
100%
100%
Ivory Associates
Sdn Bhd (485576-P)
Ivory Gleneary
Sdn Bhd (548788-M)
Ivory Meadows
Sdn Bhd (492123-A)
Ivory Square
Sdn Bhd (510587-P)
Ivory Villas
Sdn Bhd (553323-V)
Property development and
construction activities
Property development
100%
Tanjong
Tokong Garden
Development
Sendirian
Berhad (85510-X)
20%
George Town Bids
Sdn Bhd (1000980-M)
Provision of management
and regeneration activities
for George Town business
improvement district
100%
100%
100%
100%
100%
Ivory Utilities
Sdn Bhd (834590-A)
Ivory Indah
Sdn Bhd (593357-M)
G & A Consultancy
Sdn Bhd (527624-W)
Investment holding
Ivory Furniture
& Interior
Sdn Bhd (629320-D)
Ivory Property
Management
Services
Sdn Bhd (517654-M)
Interior designer and
contractor in interior
decoration and furnishing
45%
Engineering and
architectural consultancy
services
Property management
services
Tropicana Ivory
Sdn Bhd (962237-X)
100%
100%
100%
100%
100%
Ivory Times Square
Sdn Bhd (791405-M)
Ivory Media
Sdn Bhd (919038-D)
Ivory View
Sdn Bhd (925024-H)
Ivory Residence
Sdn Bhd (924702-T)
Ivory World City
Sdn Bhd (1156733-X)
Tenancy management
services, sub-letting of
properties and provision of
utilities services
Advertising services
and sub-letting
of properties
Dormant
Dormant
100%
100%
100%
G Ivory
Sdn Bhd (1157380-T)
TTG Holdings
Sdn Bhd (332545-U)
Sunlink Properties
Sdn Bhd (836156-U)
Dormant
Investment holding
Operation of entertainment,
food and beverage outlets
70%
49%
45%
Ivory Place
Sdn Bhd (924705-K)
Ivory Continental
Sdn Bhd (490558-K)
Park Vue Realty
Sdn Bhd (93359-H)
Dormant
Investment holding
04
CORPORATE INFORMATION
BOARD OF DIRECTORS
Dr Asairinachan @ Aravinachan A/L Kunjamboo
Chairman/Independent Non-Executive Director
Dato’ Low Eng Hock
Group Chief Executive Officer
Dato’ Ooi Chin Loo
Executive Director
Ooi Choi Kiat
Non-Independent Non-Executive Director
Loh Chye Teik
Independent Non-Executive Director
Lim Hock Siu
JOINT COMPANY SECRETARIES
SHARE REGISTRAR
Tai Yit Chan (MAICSA 7009143)
Ong Tze-En (MAICSA 7026537)
AGRITEUM Share Registration Services Sdn Bhd
2nd Floor, Wisma Penang Garden
42 Jalan Sultan Ahmad Shah
10050 Penang
Malaysia
PRINCIPAL PLACE OF BUSINESS
Ivory Tower @ Penang Times Square
81-11-1, Jalan Dato' Keramat
10150 George Town, Penang
Malaysia
Tel
: 604-2108000
Fax
: 604-2270000 / 2108008
Email : [email protected]
Website: www.ivory.com.my
Tel
Fax
: 604-2282321
: 604-2272391
AUDITORS
KPMG (AF 0758)
Level 18, Hunza Tower
163E Jalan Kelawei
10250 Penang
Malaysia
REGISTERED OFFICE
Suite 16-1 (Penthouse Upper)
Menara Penang Garden
42-A Jalan Sultan Ahmad Shah
10050 Penang
Malaysia
Tel
Fax
PRINCIPAL BANKERS
Bank Islam Malaysia Berhad
Standard Chartered Bank Malaysia Berhad
Malaysia Building Society Berhad
CIMB Islamic Bank Berhad
: 604-2294390
: 604-2265860
STOCK EXCHANGE LISTING
Main Market of Bursa Malaysia Securities Berhad
Stock Code : 5175
Stock Name : Ivory
annual report 2016
PENANG WORLDCITY
Bayan Mutiara, Penang
Owning a piece of this swanky haven, the Penang WorldCity would be a
dream come true for many. With a total Gross Development Value ("GDV")
of RM10 billion, this comprehensive development boasts a long list of
exciting amenities and conveniences including retail outlets, alfresco
space, convention centres, international school, hotel chains and the like.
The master plan covers 41.5ha land area in Bayan Mutiara with high-rise
residences which offers scenic beauties of the aquamarine ocean and
green hills. All these exclusive features are set to catapult this once-hidden
gem of The Pearl of The Orient into a real world-class settlement.
05
06
TROPICANA BAY RESIDENCES
On-Going Project
Bayan Mutiara, Penang
Longing for a green residential enclave? Then allow Tropicana Bay Residences
to put your mind at peace. Strategically positioned atop a terraced slope
surrounded by lush greenery, this residence development upholds the Green
City initiative launched by the state government. Comprising 6 luxury residential
condominium towers, units are available ranging from 400 sq ft to 1,945 sq
ft. Tropicana Bay Residences was highly commended at the South East Asia
Property Awards Malaysia 2015 for the Best Luxury Condo Development. The
GDV for Tropicana Bay Residences is recorded at RM933 million.
annual report 2016
CITY RESIDENCE & CITY MALL
Tanjung Tokong, Penang
How would you like the idea of indulging in the best retail therapy with a myriad
of retail outlets and having the luxury of superior living at the same spot? City
Residence & City Mall is an architectural marvel, covering a 0.98ha of prime
freehold land in Tanjung Tokong with residential units ranging from 490 sq ft to
7,882 sq ft above a retail mall. Its GDV is RM321 million.
On-Going Project
07
08
PENANG TIMES SQUARE
George Town, Penang
Status: Birch The Plaza & Commercial (Phase 1) – Completed
Birch Regency & Commercial (Phase 2) – Completed
The Wave & Commercial (Phase 3) – Ongoing
The Central, Hotel & Commercial (Phase 4) – Upcoming
Phase 5 – Future Development
Proudly standing in the heart of George Town, the multi-phase development
Penang Times Square is a marvelous feast for visitors’ sights and senses with its
melting pot of architectural styles. If you yearn for a high quality urban life with
ease of various amenities and facilities, then this is the one for you. With a GDV of
RM1.79 billion, the phases are built to accommodate both retail and residential
use. Phase 1 and Phase 2 consist of a shopping mall as well as the Entertainment
City which are significant features of the development. Both Phase 3 and Phase
4 consist of commercial podiums with a total retail sellable area of 341,971 sq ft
while Phase 5 features an upcoming commercial project.
annual report 2016
THE WAVE & COMMERCIAL
09
On-Going Project
Penang Times Square, Penang
The Wave is an award-winning building at the recent Asia Pacific Property
Awards 2014/2015 that is poised to become Penang isle’s next iconic landmark.
This entire upscale building features elegant sun protection stripes that form
a wave-like pattern, hence the name. Summed up to RM560 million in GDV,
there are 4 types of spacious suites ranging from 1,205 sq ft to 2,905 sq ft at
The Wave.
10
THE CENTRAL, HOTEL & COMMERCIAL
The CENTRAL, Hotel & Commercial, a Phase 4 Development of Penang Times
Square, is a new masterpiece that epitomises city living on a grand scale. True
to its name, this pulse of the city is set to become a new icon of George Town
that is spectacular on the outside and luxurious on the inside. Attached to an
upmarket hotel, the upscale development welcomes residents with its sleek
porte-cochere and sophisticated lobby akin to a hotel setting. The projected
GDV for this project is RM410 million.
Upcoming Project
annual report 2016
BIRCH THE PLAZA & COMMERCIAL
Completed Project
With a myriad of exciting facilities that make your
head spin, Birch the Plaza is the ideal residence
for you if you are looking for an elegant abode
with utmost ease where you need not go out and
get stuck in traffic to enjoy fine dining and leisure
activities. Birch the Plaza & Commercial’s GDV is
RM348 million.
BIRCH REGENCY & COMMERCIAL
Completed Project
Birch Regency is the epitomisation of tranquility
with high-end condominiums that make up a luxe
self-contained urban village. With a GDV of RM372
million, the comprehensive facilities fulfil residents’
need of leisure activities, like swimming, singing
karaoke, working out at the gymnasium, playing
chess, and even kids can get in on the fun at a
playground designed for mini people.
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12
ISLAND RESORT
Batu Ferringhi, Penang
Status: Club house (Phase 1) – Ongoing
10 Island Resort (Phase 2) – Completed
Phase 3 & Phase 4 – Future Development
The 4-phase Island Resort at Batu Ferringhi’s Miami Beach is a perfect
residential development especially for aspiring globetrotters. Built to exceed
the expectations of a luxury getaway, this extravagant development project
features a recreational club with food and beverage outlets, spa and sports
facilities, just to name a few. With accumulated GDV of RM336.6 million for
Phase 2 and Phase 3, the project comprises of 3 blocks of 33-storey buildings
and 11 semi-detached villas known as 10 Island Resort in its second phase,
while more residential units are planned in the third and fourth phases. Island
Resort Bungalows received the Highly Commended Award for Best Housing
Development at the South East Asia Property Awards 2014.
annual report 2016
THE LATITUDE
Completed Project
Mount Erskine, Penang
Wouldn’t it be a wonderful experience to feel the
world under your feet? The Latitude is a high-rise
condominium at Mount Erskine, Tanjung Tokong
where tranquility and world excitement strike a
perfect balance. These 1,500 sq ft and 1,600 sq ft
residential units are served by a commercial area
which are perfect for food and beverage outlets.
There are commercial units with sizes ranging
from 1,390 sq ft to 2,880 sq ft. The Latitude is also
strategically located: close to hospitals, schools,
colleges and shopping malls. For two years
consecutively, The Latitude was commended at
South East Asia Property Awards 2014 and 2015.
The project totaled up to RM192 million in GDV.
THE PEAK RESIDENCES
Completed Project
Mount Erskine, Penang
The Peak Residences is the perfect place to call
home if you have always been longing to take in
the mesmerising aerial view of the Pearl of the
Orient by day and its stunningly illuminated skyline
while being enveloped by luxury-comfort by night.
This development complete with commercial
units ranging from 940 sq ft to 1,581 sq ft is an
ideal combination of unorthodox architectural
design and impeccable hospitality. It also boasts
an ultra-luxurious condominium as well as a
myriad of services and facilities exclusively for
residents. This development recorded a GDV of
RM244 million.
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14
Completed Projects
MOONLIGHT BAY
Batu Ferringhi, Penang
Nothing else is able to surpass the experience of waking up to
beautiful sunrise and gentle breeze every morning at Penang’s
version of Southern European hillside home - Moonlight Bay. The
project’s GDV is recorded at RM181 million. Secluded from the
bustling city, this heavenly sanctuary features 70 villa and 20 condovilla units on freehold land that spans 6ha at about 30m above sea
level. It was also commended as Best Leisure Development at the
Asia Pacific Property Awards 2011 and winner of TheStarProperty.
my Awards 2016 under The Niche & Unique Development Award
category.
ASTON VILLA
Bukit Mertajam, Penang
A serene enclave with city connections, Aston Villa is the maiden
project of Ivory on the mainland launched right in the middle of
the central business district at Bukit Mertajam amid a boisterous
downtown atmosphere. Totaling RM64 million in GDV, the gated and
round-the-clock guarded community spanning 6.5ha of freehold
land comprises of 3-storey terraces, semi-detached houses and
4-storey shoplots showcasing modest yet modern architecture as
well as expansive commercial space.
ZEN @ THE VIEW
Batu Uban, Penang
With a GDV of RM14 million, Zen @ The View is the quintessential
luxury living amidst a bustling metropolis meant for city dwellers
who yearn to enrich their lifestyle. It consists of tailor-made
3-storey bungalows with rooftop terraces and spectacular views.
Its monochrome minimalism is complemented by a spacious
layout that seems to expand when the light hits every corner of the
bungalow.
annual report 2016
15
Completed Projects
THE VIEW TWIN TOWERS
Batu Uban, Penang
The twin towers of The View are set off the road and other residential
areas, offering peace, seclusion and privacy for residents. Inspired
by the Petronas Twin Towers, its arresting building style often
deludes people travelling across the bridge from the mainland
to the island into thinking they have somehow made their way to
Kuala Lumpur to see the world’s tallest twin structure. The View
Twin Towers GDV at RM108 million.
PALACE HILL
Bukit Gambier, Penang
Palace Hill, as its name suggests, is a residential development
where each palace-like residence boasts charming architecture
with distinctive Georgian features. As a beautiful oasis of serenity
and exclusivity, Palace Hill with a GDV of RM38 million, is no
doubt one of Penang’s safest residential communities with its
low density of only 4 bungalows and 36 semi-detached houses
surrounded by landscaped street and park.
PLAZA IVORY
Bukit Gambier, Penang
Plaza Ivory is the ideal residence which offers new heights
of comfort, leisure activities, dining and more, all within an
amazing spot. With a GDV of RM86 million, Plaza Ivory consists
of 2 condominium towers backed by greeneries and offers a
spectacular view of the Penang Bridge and the scenic coastline
of the island as well as a commercial area with 28 shop houses
and 56 double-storey retail lots.
TANJUNG PARK
Tanjung Tokong, Penang
Inspired by classical French architecture, Tanjung Park with
a GDV of RM102 million, is a high-end development featuring
spacious units in two 25-storey blocks and townhouses atop a
podium that gives a mesmerising view of one of the island’s most
famous tourist spots, Gurney Drive.
16
AWARDS AND ACHIEVEMENTS
Established in 1999, Ivory Properties Group Berhad is a full-fledged property development consortium with exceptional
design-build-property management capabilities and international real estate advisory services.
We have a highly professional and dedicated team of landscape architects, planners, interior designers, architectural
technologists and multimedia artists as well as an innovative construction team with robust backgrounds. Leading
them is a prudent project management team which has over 30 years of invaluable experience and is known for their
shrewd business acumen.
Through solid teamwork and our longstanding commitment to deliver excellent services, our projects are prestigious
and are a resounding success. The company’s awards and achievements received over the years are a testimony to our
rock-solid foundation which is built on top-notch innovation, commitment and hard work demonstrated by every Ivorian.
2016
StarProperty.my Awards 2016 Asia Pacific Property Awards
CSR Malaysia Awards 2016 Excellence prize in The Niche
2016 in association with
Company of the Year Award
& Unique Award Category The Telegraph - Ivory Tower
under Sustainability Excellence
Moonlight Bay
won Highly Commended Award
Category
for Office Architecture.
2015
HIGHLY
COMMENDED
Best Luxury Condo Development
(North Malaysia)
Tropicana Bay Residences
by Tropicana Ivory Sdn Bhd
Kwong Wah Yit Poh Centennial
Awards 2015 – Dr Sun Yat-sen
Outstanding Enterprise Award
(Winner)
South East Asia Property
Awards Malaysia 2015 – Highly
Commended for Best Luxury
Condo Development (North
Malaysia) – Tropicana Bay
Residences
Awards Malaysia 2015 – Highly
Commended for Best MidRange Condo Development
(North Malaysia) – The Latitude
The Golden Eagle
Award 2015 – Eminent
Eagle category
2014
2013
Asia Pacific Property Awards
The Golden Eagle Award 2014 The Asset Triple A Transaction
Awards Malaysia 2014 – Highly Awards Malaysia 2014 – Highly
in association with Maybank
– Eminent Eagle Category
Banking Awards 2013
Commended for Best MidCommended for Best Housing
– Highly Commended for
Range Condo Development
Development (North Malaysia) –
Best Residential High-Rise
(North Malaysia) – The Latitude
Island Resort Bungalows
Architecture Malaysia (The Wave)
2012
INPenang Awards 2012
- Top F&B Hubs
2011
INPenang Awards 2012
- Top Developers
NST Property - SC Cheah’s
Choice Awards 2011 - Best
Penang Developer
International Standard Quality
(ISQ) Awards - Quality Property
Developer & Contractor
Asia Pacific Property Awards
2011 in association with
Bloomberg Television - Highly
Commended for Best Leisure
Development (Moonlight Bay)
annual report 2016
17
AWARDS AND ACHIEVEMENTS
2011
2010
The Edge Malaysia - Top
Property Developers Awards
- Ivory Associates Sdn Bhd
ranked in Top 30 under
Qualitative Attributes for
Product Quality, Innovation &
Creativity, Value Creation for
Buyers, Image and Expertise
Asia Pacific Property
Awards in association with
Bloomberg Television - Highly
Commended for Best Mixed
Use Development
(Penang Times Square)
2009
Kwong Wah Yit Poh Centennial
Awards 2010 Dr Sun Yat-sen Outstanding
Enterprise Award Winner
Trane Energy Efficiency Leader
Award 2010 for Environmental
Sustainability, Energy and
Operational Efficiency
2008
ISO 9001:2008 Ivory Property
Management Services Sdn Bhd
(6962)
The Malaysian Construction
Industry Excellence Awards
2008 (CIDB)
Asia Pacific Super Excellent
Brand 2008 Winner
In Penang My Preferred 2nd
Home Property 2007 by Market
Source Publishing Winner
The International Real Estate
Federation (FIABCI) Malaysian
Chapter
2006
Business Superbrands Malaysia
Status 2006
2007
1st Top 50 Enterprise Awards
Malaysia 2007
- Platinum Award Winner
ISO 9001:2008 G & A
Consultancy Sdn Bhd (3733)
ISO 9001:2008 Ivory Associates
Sdn Bhd (3732)
2005
The Golden Bull Award 2006
- Malaysia 100 outstanding
SMEs (3rd Runner-up)
SMEs (Top 50 Winners)
The Enterprise 50 Award 2005
(Top 50 Winners)
2004
SMEs (1st Runner-up)
Penang International Expo 2007
- Best Decorated Booth
2006
2007
The Edge Malaysia - Top
Property Developers Awards
- Ivory Associates Sdn Bhd
ranked in Top 30 List under
Qualitative Attributes for Product
Quality, Innovation & Creativity,
Value Creation for Buyers, Image
and Expertise
SME Business of the Year
Award 2004 Winner
Keris Award 2004 Winner
4th Asia Pacific/Malaysia
e-Entrepreneur Excellence
Award 2005 Winner
2003
Penang State Landscape
Competition 2004 1st Runner-up
18
CALENDAR OF EVENTS
1
2
3
4
5
6
7
annual report 2016
CALENDAR OF EVENTS
2 April - 5 April 2015
1
My Property Fair
Penang WorldCity was featured at the property fair at Queensbay Mall, Penang. Eager
purchasers flocked the exhibition booth for more information about the units which they
were eyeing as their next residence or investment.
23 April - 26 April 2015
2
Home And Investment Fair By iProperty
Leeching on the household name of property sub-sale giant iProperty, our team participated
in the fair at Gurney Plaza, Penang for more exposure on the latest market trends and to
reach out to potential purchasers.
30 April - 4 May 2015
3
Labour Day Roadshow
Our sales team’s efforts proved fruitful during the extended Labour Day weekend at Gurney
Plaza, Penang. Our team successfully engaged the shoppers and closed numerous sales
at the site.
9 July - 12 July 2015
4
The Star Property Fair
The property fair was organised at Gurney Plaza, Penang during Hari Raya to attract the
"balik kampung" crowd. Our team witnessed massive turnout of home shoppers from
across the region.
16 Aug 2015
5
Poolside Party @ The Latitude
Organised to celebrate the completion of The Latitude, the poolside party was also an
occasion to appreciate our staff’s involvement throughout the construction of the project.
Everyone from the site to the management and staffs from all departments had the
opportunity to attend the party. The management also took the opportunity to honour long
serving staffs for their loyalty towards our company through awards presentation.
30 July - 2 Aug 2015
6
2015 Property Fair by Kenlink
The exhibition held at Queensbay Mall, Penang achieved a good number of sales when
shoppers visited our booth to enquire about projects they were eyeing for their next
purchase.
27 Aug - 1 Sept 2015
7
Merdeka Roadshow
Our sales team managed to grab the attention of the National Day crowd and received
an awesome response from buyers who returned to this beautiful island for the National
Day holiday.
19
20
CALENDAR OF EVENTS
8
9
10
11
12
13
14
annual report 2016
CALENDAR OF EVENTS
17 Sept 2015
8
Annual General Meeting (“AGM”) and Extraordinary General Meeting (“EGM”)
Chaired by Ivory Properties Group Berhad ("Ivory") Chairman and Independent NonExecutive Director, Dr K. Asairinachan @ Aravinachan, Ivory obtained unanimous approval
for all the resolutions during the AGM and EGM.
1 Oct - 4 Oct 2015
9
The Star Property Fair
Our sales team received an overwhelming response from readers of The Star who
thronged the Star Property Fair at Queensbay Mall, Penang.
25 Nov 2015
10
Extraordinary General Meeting
During the EGM, Ivory Properties Group Berhad obtained unanimous approval from its
Shareholders to dispose of a piece of freehold land located in Penang.
24 Dec 2015
11
Christmas Countdown
The Christmas Countdown Party themed "Snow Party", was held at Chin Ho Plaza, Penang
Times Square. Many patrons came dressed according to the theme to celebrate this
joyous occasion. Along with dazzling performances by talented artistes, it was indeed a
"Merry Christmas"!
31 Dec 2015
12
New Year’s Eve 2016 Countdown
Within a few hours of the new year, thousands of people gathered at Chin Ho Plaza,
Penang Times Square to catch stellar performances by talented artistes and to count
down to the new year!
31 Dec 2015 - 1 Jan 2016
13
New Year Roadshow 2016
Our sales team helped home buyers clear their pending resolutions from year 2015, by
exploring the Group’s unique projects and answering their questions about getting a new
house.
8 Feb - 14 Feb 2016
14
Chinese New Year Roadshow 2016
In welcoming the year of the Monkey, roadshows were held at Gurney Plaza, Penang, M
Mall O2O @ Penang Times Square and the sales galleries at Ivory Tower and Penang
WorldCity to attend to the Chinese New Year crowd coming in from different parts of the
island and country.
21
22
CORPORATE SOCIAL
RESPONSIBILITY
Persatuan Kebajikan Ivory, Pulau Pinang (“Ivorycares”) is a charitable arm of Ivory Properties Group
Berhad (“Ivory”) established on Nov 30, 2006 under the Societies Act 1966, Malaysia.
Comprising a purely voluntary staff force, Ivorycares extends its assistance in undertaking all
charitable activities and projects planned throughout the year. Serving as a platform for employees
of Ivory to lend a helping hand to the needy amidst their work commitment, Ivorycares operates
without funding from Ivory in order to allow the arm to run free from any business interest. Its
fundamental mission is to light up the lives of the less fortunate by offering help and friendship as
well as contributing towards their day-to-day living needs. Over the years, Ivorycares has carried out
various noble activities, hence serving as one of the channels for Ivory to fulfil its social obligations.
Emphasis is also placed on environmental sustainability where employees are encouraged to go
green in an effort to conserve the environment. Its effort in doing good and contributing to the
society has also earned a prestigious recognition when Ivorycares won the CSR Malaysia Awards
2016 - Company of the Year Award under Sustainability Excellence Category.
1
2
3
4
annual report 2016
CORPORATE SOCIAL RESPONSIBILITY
26 April 2015
1
Saving lives at no cost
Ivorycares and Allianz General Insurance Company (Malaysia) Berhad joined hands to
organise a blood donation campaign in conjunction with World Health Day. Themed “A
Drop of Blood Forms an Ocean of Love”, the event at Penang Times Square saw blood
donors turning up in a bid to help the Penang Hospital blood bank overcome its blood
supply shortage.
8 May 2015
2
Ivorycares “goes blue” in beach clean-up
A beach clean-up programme themed “To Laut with Love” was jointly organised by
Universiti Sains Malaysia (“USM”) Scuba Diving Club and Ivorycares. The event, which
was part of the club’s Ocean Awareness Outreach campaign, was supported by the
Penang Island City Council. The volunteers from USM and Ivorycares, combed the beach
in Kampung Nelayan, Teluk Kumbar for rubbish which was then sorted into different
categories such as clothes, plastic, glass and metal.
11 May 2015
3
Thoughtful gifts for single mums
Ivorycares presented hampers to single mothers in conjunction with Mother’s Day
celebration. The mothers, together with their children were beaming with excitement when
they received their gifts as well as red packets.
13 June 2015
4
Badminton competition to celebrate Father’s Day
An in-house badminton tournament was held for the staff of Ivory Properties Group in
conjunction with Father’s Day celebration. Organised by Ivorycares, the sporting event aimed
to promote a healthy work-life balance and the spirit of camaraderie among fellow Ivorians.
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annual report 2016
30 June - 15 July 2015
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Adopting plants for a good cause
A fundraising project called "Adopt Me" was carried out for fellow Ivorians to adopt a plant.
The proceeds were donated to the Sabah Social Services Council Fund in aid of the disaster
victims in Sabah.
10 July 2015
6
"Jamuan Buka Puasa" for poor families during Ramadan
Ivorycares volunteers and the Penang Times Square management team jointly organised a
"Jamuan Buka Puasa" to treat needy families during the holy month of Ramadan. At the event
held at Masjid Kampung Jawa, the families were given goodie bags filled with daily essential
items and festive delicacies, as well as green packets.
7 Aug 2015
7
Movie night for Ivorians
Ivorycares members were treated to a subsidised movie night outing in appreciation of
their participation in charitable activities throughout the year. A dinner gathering was also
held before the movie to establish a close-knit relationship amongst colleagues.
21 Aug 2015
8
Ivorycares Bowling Championship
A bowling competition was organised by Ivorycares to encourage social interactions
amongst Ivorians while achieving results through strategy planning and team support.
13 Sept 2015
9
Penang Starwalk
Over 20,000 participants took part in the annual Penang Starwalk event organised by The
Star. The 7km walk was flagged off in front of Penang Times Square.
Ivorycares volunteers together with the volunteers of various NGOs walked alongside
underprivileged children and disabled folk in the 1km charity walk.
After the walk, the participants from the charitable homes enjoyed an appetising breakfast
prepared by Ivorycares members and received goodie bags containing daily essential items.
9 Oct 2015
10
Health screening for Ivorians
A free health screening programme was organised by Ivorycares in collaboration with the
Penang Adventist Hospital to promote a healthy lifestyle.
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annual report 2016
31 Oct 2015
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World Children’s Day 2015
Ivorycares organised a fun World Children’s Day event for children to engage with nature
at Taman Kuari, Penang Botanical Garden. It aimed to bring the younger generation closer
to nature while having fun without any electronic gadgets. Apart from the exciting outdoor
activities, the children were also treated to a sketch inspired by Disney’s animated movie
Frozen performed by Ivorycares volunteers.
2 Nov 2015
12
Rangoli-making for Deepavali
In conjunction with the Deepavali festival, Ivorycares organised a special activity for nonHindu Ivorians to have a hands-on experience in making the rangoli, a traditional form of
Indian art. A six-foot motif and coloured rice was placed at the Ivory Sales Gallery’s centre
court for Ivorians to try their hand in completing the rangoli.
19 Dec 2015
13
Summer Christmas Party and Charity Car Boot Sale
Children from Penang Shan Children’s Home, St Joseph’s Home and House of Hope were
all smiles when they received Christmas presents from their Secret Santas at the Summer
Christmas Party held at Chin Ho Plaza, Penang Times Square.
Held concurrently with the event was the Charity Car Boot Sale that aimed to promote
recycling, reduce waste and space, as well as drive stock clearance.
22 Dec 2015
14
A gift of gratitude
In conjunction with the Christmas celebrations, Ivorycares played Secret Santa to the staff
at Ivory Headquarters by hanging Christmas socks containing token gifts on the door of
every department. The gesture was to thank the staff for their generous contributions, active
support and keen participation in the activities held throughout the year.
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annual report 2016
23 Jan 2016
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Celebrating Thaipusam
On the eve of Thaipusam, Ivorycares volunteers smashed coconuts and gave out packs
of vegetarian food and drinks to devotees who lined the roads to pay obeisance to Lord
Muruga. It is the 10th year that Ivory has contributed towards this vibrant and colourful festive
occasion.
16 Feb 2016
16
Chinese New Year steamboat treat for the elderly
In conjunction with Chinese New Year, Ivorycares treated the elderly residents of Gan En Zhi
Jia (Home for the Senior Citizens) to a scrumptious steamboat dinner. Ivorycares volunteers
visited the home to hand over daily essential items while "ang pao" was also distributed to
the residents.
22 Feb - 29 Feb 2016
17
Flower sale for charity
The Ivorycares charity flower sale was held once again in conjunction with International
Women’s Day. All proceeds were channelled to Ivorycares for future charitable activities.
3 Mar - 4 Mar 2016
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"Pledge for Parity" to accelerate gender equality
To commemorate International Women’s Day and to celebrate the achievements of women,
Ivorycares encouraged all Ivorians to pledge their support to help achieve gender equality.
Every pledge was posted on the International Women’s Day website.
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MEDIA HIGHLIGHTS
annual report 2016
MEDIA HIGHLIGHTS
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CHAIRMAN'S MESSAGE
Our Valued Shareholders,
On behalf of the Board of Directors of Ivory
Properties Group Berhad (“Ivory” or “the
Company”), it gives me great pleasure to present
to you our fiscal year 2016 Annual Report and the
Audited Financial Statements of our Company.
THE YEAR IN REVIEW
subsidiary of Ivory and Jesselton Peak Sdn Bhd. The
disposal was seen as a strategic move, enabling Ivory
to realise and unlock the value of the property which
was not generating any income.
The net gain from the disposal was estimated at RM38
million which will be recognised upon completion. The
deal is currently in progress pending fulfilment of the
conditions precedent stated under the agreement.
A challenging year had been anticipated for financial
year 2016, with the weakening of the Ringgit and
implementation of the Goods and Services Tax (“GST”)
on April 1, 2015. There was also a slow demand of
residential property in Malaysia in 2015 due to stringent
approval measures. The local market was also affected
by the high bank rejection rate as well as certain
measures set by Bank Negara to reduce the debt ratio.
Things however were looking up towards the end of the
year when the Ringgit bounced back to open higher
against the United States Dollar, and the price of crude
oil got steadier.
A new mall called M Mall O2O located at the second
phase of Penang Times Square opened its doors to
the public in December 2015. With carefully designed
themed streets and a wax museum at the four-storey
mall, M Mall O2O is poised to be a major tourist
attraction in Penang.
Ivory also celebrated the opening of a new Marrybrown
outlet at The Latitude Commercial in January 2016. It
is Ivory’s second Marrybrown outlet in Penang at the
moment.
Despite the turbulent events of the year, Ivory continued
to garner strong interest among investors and home
buyers, for its projects - Tropicana Bay Residences at
Penang WorldCity in Bayan Mutiara, City Residence in
Tanjung Tokong and The Latitude in Mount Erskine.
In January 2015, Ivory made a strategic decision to
dispose of a piece of land measuring approximately
21.77ha with freehold title in George Town (off Jalan
Kebun Bunga) at RM150 million. The deal was entered
between Ivory Indah Sdn Bhd,which is a wholly-owned
This year, the Board has selected the symbol of a tree
on the cover page of this Annual Report to represent
our Group. Signifying growth, the tree is a reflection of
our Ivory team leading the ever growing Group to be
an organisation that identifies with its shareholders,
employees and the community. As resilient and
resourceful as a tree, Ivory has established strong roots
on solid ground.
The trunk represents our core values and strengths
while the branches signify our diversification upward
and outward. Lush leaves and new buds are the new
products that we continually seek to offer. Like a tree,
Ivory speeds up growth in the right conditions, and
blooms with hard work. Just as a tree responds to its
surroundings, Ivory is swift to react when opportunities
are present and prudent in times of adversity.
annual report 2016
CHAIRMAN'S MESSAGE
FINANCIAL PERFORMANCE
In the midst of challenging property market conditions,
our Group effectively strategised its marketing efforts to
generate a substantial revenue of RM423 million for the
financial year ended March 31, 2016.
The property development and construction divisions
were the main contributors to the Group’s revenue,
registering RM231.10 million and RM122.39 million
respectively, primarily attributed to the Group’s existing
projects, namely City Residence and City Mall at
Tanjung Tokong and integrated development at Penang
Times Square together with the construction contract at
Penang WorldCity.
Total sales locked in for the financial year was
approximately RM700 million, giving our Group a total
unbilled sales of RM900 million as at March 31, 2016.
These unbilled sales, followed by steady construction
progress of the development, will contribute positively
to our Group’s performance in the near future.
Our Group reported a pre-tax profit of RM17.75 million
and profit after tax of RM10.39 million, while basic
earnings per share attributable to shareholders was
2.37 sen. Net tangible assets per share as at March 31,
2016 was RM0.93.
under the Residential High-rise Architecture Malaysia
category at the Asia Pacific Property Awards 2014/2015.
It was a double win for Ivory at the South East Asia
Property Awards (Malaysia) 2015 when The Latitude
won the Highly Commended Award for Best Mid-Range
Condo Development (North Malaysia), and Tropicana
Bay Residences won the Highly Commended Award for
Best Luxury Condo Development (North Malaysia).
Moonlight Bay, one of Ivory’s highly praised
developments in Batu Ferringhi also snagged The
Niche and Unique Award at the inaugural StarProperty.
my Awards 2016. Shortly after, Ivory took home the
Highly Commended Award in the Office Architecture
Malaysia category for its Ivory Tower project at the Asia
Pacific Property Awards 2016/2017.
During the financial year, our Group successfully handed
over vacant possession of 218 units of condominium
and 20 units of commercial lots of our project at Mount
Erskine, The Latitude condominium and its commercial
component with 98% sales to-date. Our Group is
expected to commence work for phase 4 of Penang
Times Square in 2017, comprising a service suites tower,
a hotel tower and a commercial and retail podium.
ACCOMPLISHMENTS
As a Group that develops a wide range of lifestyle
and premium upscale projects in Penang, Ivory is
highly regarded as among the top developers around.
I am pleased to note that Ivory won 7 awards since the
last financial year.
At the Golden Eagle Awards 2015 organised by
Nanyang Siang Pau, Ivory won the Eminent Eagle
Award. Ivory’s The Wave project at Penang Times
Square was also recognised as Highly Commended
Last but not least, Ivory was recognised as the “Company
of the Year” by winning the CSR Malaysia Awards 2016
under the Sustainability Excellence category for the
wide range of community services work it carries out.
These prestigious and recognised industry awards are
a testament to our Group’s innovation and commitment
in developing distinguished and sustainable projects
and its positive impact and interaction with the
environment and community.
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CHAIRMAN'S MESSAGE
PROSPECTS AND OUTLOOK
There are challenges lying ahead for all industries but we
take it as an opportunity for greater growth. We anticipate
the Penang Transport Master Plan (“PTMP”) to improve
the public transportation system and for the policies on
getting higher density to be granted.
The PTMP will be a boost for Penang to become an
international city. Once it kicks off, it will address the
issue of traffic congestion for a more vibrant Penang.
With the PTMP, we foresee a higher demand for homes
from foreigners who seek to relocate or retire in Penang.
We will thus shift our focus on building homes suitable
for them, and also hotels to cater to the growing throng
of tourists.
Over the years, we have carved a reputation of
building high-end homes offering comfort and luxury.
In view of the local property market outlook, we are
exploring possibilities of offering homes of more
affordable values to prospective homeowners.
Among the projects in the pipeline is the Penang
WorldCity mega mixed development that will
encompass retail and residential development,
affordable housing, hotel, medical centre, transportation
hub, market, food centre and more. It also includes
developments of a school and other education
institutions, places of worship along with public amenities
– garden, waterfront promenade and bicycle track.
Development plans are underway for prime locations
in Batu Ferringhi with proposed development along the
tourist belt, which will include a condominium and hotel.
The completion of Phase 3’s and Phase 4’s commercial
components together with Phase 2 of Penang Times
Square will make Penang Times Square one of the
biggest malls in northern Malaysia.
When completed, Penang Times Square will comprise
of a cineplex, hotels, residential towers, commercial
podium and mall, making it a truly comprehensive
development.
APPRECIATION
On behalf of the Board, I extend my sincere thanks to
business partners, shareholders, regulatory authorities,
the media and financiers for their trust, support and
confidence in our Group. I also thank our customers for
supporting our projects. Your continued patronage is a
vital part of our growth.
To my fellow Directors, I am grateful for your counsel,
guidance and support. I am also deeply appreciative
of Ivory’s management and staff who were none other
than dedicated, efficient and committed to upholding
our Group’s standards and vision to build a better world
for our future generations.
The unwavering support and commitment to excellence
from all are essential for us to achieve greater heights and
prosper as one of the leading developers in the country.
25 July 2016
annual report 2016
BOARD OF DIRECTORS
Dr Asairinachan @
Aravinachan A/L Kunjamboo
Group Chief Executive Officer
Dr Asairinachan @ Aravinachan A/L Kunjamboo,
a Malaysian, male, aged 68, was appointed as
an Independent Non-Executive Director of our
Company on 12 March 2010 and on 8 February 2013,
Dr Asairinachan was appointed as our Company’s
Chairman. Dr Asairinachan is also a Member of the Audit
Committee.
Dato’ Low Eng Hock, a Malaysian, male, aged 53, was
appointed as the Group Chief Executive Officer (“CEO”)
of our Company on 12 March 2010.
He obtained his Bachelor of Science Honours Degree
from Universiti Sains Malaysia in 1972, holds a Master
of Science from Imperial College, London and a Doctor
of Business Administration from the University of
South Australia. Additionally, he also holds postgraduate
qualifications in Management (Diploma from Malaysian
Institute of Management) and Accounting and Finance
(Certified Diploma from ACCA).
Dr Asairinachan is an Environmental Consultant by
profession with over 40 years of extensive experience. He
started his career in 1972 with Dewan Bandaraya Kuala
Lumpur (“DBKL”) as Manager and served for 22 years
in DBKL. Thereafter, he joined Indah Water Konsortium
Sdn Bhd from 1994 to 2000 as an Executive Director.
Presently, he is the Managing Director and Shareholder
of Waste Stream Management Sdn Bhd, a company
providing consultancy and training in waste water
management.
Dr Asairinachan does not have any conflict of interest
with our Company and he has no family relationship with
any Director and/or major shareholder of our Company.
Dr Asairinachan does not hold any directorship in public
companies and public listed companies. He has no
conviction for any offences within the past five years.
Dato' Low is also a Member of the Remuneration
Committee. As founder and Group CEO, he is instrumental
in charting the growth, success and development of our
Group. Dato’ Low has more than 30 years of experience
in property development, building and construction
industries. Presently, Dato’ Low oversees general business
management and the implementation of our Group’s
strategic policies.
He obtained his Bachelor Degree in Engineering with
Distinction from Concordia University, Montreal, Canada
in 1985. He is also a member of the Institution of Engineers,
Malaysia. Upon his graduation, he joined Low Theon &
Sons Sendirian Berhad, a civil engineering contracting
company. He was then in charge of Timah Tasoh Dam in
Perlis, Kerian-Sg Manik Integrated Development Project
in Perak under the Drainage and Irrigation Department
and several other large scale infrastructure projects, all
of which were completed successfully. He began his
career in property development through his participation
in the Penang Gold Coast mixed development adjacent
to Queensbay, Penang.
In 1999, he established Ivory Associates Sdn Bhd,
the first company in our Group. Since then, under his
progressive vision, pragmatic approach and proven
leadership, our Group has grown into a major property
developer in Malaysia.
Dato’ Low is also a member of the International Council
of Shopping Centers since 2004.
Dato’ Low does not have any conflict of interest with our
Company. Other than Ooi Choi Kiat, who is his brother
in-law, Dato’ Low has no other family relationship with
Dato’ Low does not hold any directorship in public
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BOARD OF DIRECTORS
Ooi Choi Kiat
Executive Director
Non-Independent Non-Executive Director
Dato’ Ooi Chin Loo, a Malaysian, male, aged 64, was
appointed as an Executive Director of our Company on
1 May 2012.
Ooi Choi Kiat, a Malaysian, male, aged 59, was appointed
as a Non-Independent Non-Executive Director of our
Company on 12 March 2010. He is also a member of the
Audit and Nominating Committees.
He graduated from Universiti Sains Malaysia in 1976 with
a Bachelor of Social Science (Honours) Degree. Following
his graduation, Dato’ Ooi joined the Municipal Council of
Penang Island (“Municipal Council”) as an Administrative
Officer. During his service with the Municipal Council, he
served various sections of the Secretariat Department
with increasing responsibilities until his promotions as
Principal Assistant Secretary in 2001 and thereafter as
Municipal Secretary in 2002. As Municipal Secretary, he
was responsible for the overall operational management
of the Municipal Council to ensure that the functions of
the Municipal Council as a local authority were carried
out effectively.
After serving the Council for 31 years, he retired from
public service and joined our Group as Senior Project
and Planning Manager in August 2008. He has brought
with him more than 30 years of invaluable experience
and helpful contacts to lead the Planning Department
as well as to oversee the operations of the Technical,
Engineering, Property Management and Construction
Departments of our Group. Dato’ Ooi was promoted to
the position of Chief Operating Officer in 2010 where he
was responsible for the overall smooth and successful
implementation of projects and proper management
of our Group’s properties before assuming his current
position as Executive Director.
Dato’ Ooi does not have any conflict of interest with
our Company and he has no family relationship with
Dato’ Ooi does not hold any directorship in public
Mr Ooi graduated in 1983 with a Bachelor of Housing,
Building and Planning from Universiti Sains Malaysia,
Penang. He has extensive experience in infrastructure
projects including highway and bridge construction,
earthworks, waterworks and telecommunications facilities
mainly in the Klang Valley.
He started his career in 1983 as a Project Manager with
a construction company, Unisoon Development (M) Sdn
Bhd. In 1989, he left to establish Mawar Abadi (M) Sdn
Bhd, a building contractor company where he is the
Managing Director.
Mr Ooi does not have any conflict of interest with our
Company. Other than Dato’ Low Eng Hock, who is his
brother in-law, Mr Ooi has no family relationship with
Mr Ooi does not hold any directorship in public companies
and public listed companies. He has no conviction for
any offences within the past five years.
annual report 2016
BOARD OF DIRECTORS
Loh Chye Teik
Lim Hock Siu
Loh Chye Teik, a Malaysian, male, aged 57, was
appointed as an Independent Non-Executive Director of
our Company on 12 March 2010. He is the Chairman of
the Audit Committee and a member of the Nominating
and Remuneration Committees.
Lim Hock Siu, a Malaysian, male, aged 60, was
appointed as an Independent Non-Executive Director
of our Company on 12 March 2010. He is the Chairman
of the Nominating and Remuneration Committees and a
member of the Audit Committee.
He graduated from University of Malaya, Kuala Lumpur
with a Bachelor of Accounting (Honours) in 1984.
He started his career in 1978 with Syarikat Soon Theam
(now known as Kenanga Investment Bank Berhad) after
obtaining his Higher School Certificate.
He is presently a Partner of UHY Chartered Accountants,
Partner of UHY Loh Chartered Accountants and the
Managing Director of Interesources Tax Advisory Sdn
Bhd. He is a member of both the Malaysian Institute of
Accountants and the Chartered Tax Institute of Malaysia.
He started his career as an Auditor in a firm of chartered
accountants in Penang in 1985. In 1994, he set up his
own audit and accounting firm, Tan & Loh Chartered
Accountants where he held the position of Managing
Partner. Presently, he also sits on the Board of other
public listed companies namely JHM Consolidation
Berhad and Olympia Industries Berhad as Independent
Non-Executive Director.
Mr Loh does not have any conflict of interest with our
Company and he has no family relationship with any
Director and/or major shareholder of our Company. He
has no conviction for any offences within the past five
years.
In 1980, he joined Expandite Sdn Bhd (“Expandite”),
a global company involved in the supply of specialty
chemicals to the construction industry.
Following the merger of Expandite with Fosroc Sdn
Bhd (“Fosroc”), a world leader in the delivery of tailored
construction solutions for construction projects,
Mr Lim served in various capacities and seniority until
he assumed the position of Regional Sales Manager
of Fosroc in 2004. He was the Northern Region Branch
Manager of Fosroc from 2005 until his resignation in
2009.
He does not have any conflict of interest with our
Director and/or major shareholder of our Company.
Mr Lim does not hold any directorship in public companies
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KEY SENIOR MANAGEMENT
Goh Chin Heng
Yeong Siew Yan
Chief Operating Officer
Deputy Chief Operating Officer
Goh Chin Heng, aged 39, a Malaysian, male, is the Chief
Operating Officer of our Group since 8 February 2013.
He graduated with a Bachelor of Engineering (Civil) from
Universiti Putra Malaysia in year 2001 and obtained his
Master of Civil Engineering (Specialisation in Concrete
Structures) from the Imperial College of Science, Technology
and Medicine, University of London, a year later.
Yeong Siew Yan, aged 39, a Malaysian, male, was
appointed as Deputy Chief Operating Officer of our
Group on 15 May 2013. He graduated with a Bachelor of
Science (Honours) in Urban and Regional Planning from
Universiti Sains Malaysia in year 2001 and subsequently
obtained his Master of Science in Planning 2 years later.
He is currently a qualified Town Planner as a corporate
member of the Malaysian Institute of Planner and the
Board of Town Planners Malaysia.
Upon graduation, he commenced his career as Civil and
Structural (“C&S”) Engineer with Arup Jurunding Sdn Bhd
in year 2002. He was the Structural Design Engineer for
Bayswater Resort Condominium project and The Palazzo
Condominium project, both in Penang. In addition to
structural analysis, substructure and superstructure
(Reinforced Concrete) design, he was also involved in
prestressed-concrete analysis and steelwork design.
In year 2005, he joined our Group as C&S Engineer.
His job scope included layout plan scheming,
structural system analysis, providing substructure and
superstructure design support, preparation and review of
shop drawing and providing structural solutions utilising
a variety of design, software and integrated materialstructural engineering techniques.
In year 2007, he was promoted to Senior Project
Coordinator of our Planning Department, responsible
for monitoring and coordinating overall planning
and submission of plans to relevant authorities and
ensuring clearance and approval are obtained from
relevant authorities within the targeted time frame. He
was promoted to Operations Director in year 2010 and
was responsible for overseeing the operations of the
Technical, Engineering, Property Management and
Construction Departments of our Group. He was also the
liaison party between government officials and our Group
to ensure a well implementation of development projects,
ensuring strict adherence to Municipality Regulations
and Guidelines up to the completion of the projects. In
June 2011, he was promoted from Operations Director
to Deputy Chief Operating Officer assisting the Chief
Operating Officer in ensuring proper management as
well as smooth and successful implementation of all
projects.
Mr Goh is a Graduate member of the Board of Engineers
Malaysia and the Institution of Engineers Malaysia since
years 2004 and 2006 respectively. He is also a member
of the International Council of Shopping Centers since
December 2009.
Mr Goh does not have any conflict of interest with our
Mr Goh does not hold any directorship in public
He joined our Group in year 2004 as Assistant Project
Planner and was subsequently promoted to Project
Planner in the following year to monitor and follow up on
authorities’ approvals. In year 2007, he was promoted to
the position of Assistant Manager of our Development
Planning Department and thereafter to Project Director
(Development and Design) in year 2010 to oversee
development planning, as well as the graphic and
multimedia design teams of our Group.
Two years later, Mr Yeong was promoted to the position
of Deputy General Manager (Property Development) to
oversee the Penang WorldCity project under Tropicana
Ivory Sdn Bhd and moved on to become its General
Manager in year 2012.
His present position as the Deputy Chief Operating
Officer of our Group is to assist the Chief Operating
Officer in overseeing daily operations of our Group and
to develop strategies for all aspects, including future
development of our Group.
Mr Yeong does not have any conflict of interest with
our Company and he has no family relationship with
Mr Yeong does not hold any directorship in public
annual report 2016
Wong Siew Chong, Ben
Ju Siew Lee, Grace
Chief Development Officer
Chief Financial Officer
Wong Siew Chong, Ben, a Malaysian, male, aged 49, is
the Chief Development Officer of our Group. He joined
our Group in his current position on 16 April 2013 to
oversee all development projects from conceptual
design to project handover.
Ju Siew Lee, Grace, aged 46, a Malaysian, female, joined
our Group as Group Financial Controller in September
2015. As Group Financial Controller, Ms Ju is responsible
for our Group's financial and management reporting,
treasury, risk management and internal control system
and procedures, corporate finance, governance and
regulatory compliance. She was promoted to Chief
Financial Officer on 1 February 2016.
He has 18 years of experience in architectural design and
real estate activities. Mr Wong has directed, managed
and led multi-disciplinary international consortium for
intricate world-renowned projects in Malaysia and the
United Arab Emirates.
Mr Wong pursued his architectural study at Tunghai
University, Taiwan and started his career as a design
architect in Taiwan in year 1995. He returned to Malaysia
in year 1996 and joined Penas Realty Sdn. Bhd as a
Design Architect. In year 1998, due to expansion, few
departments were consolidated under PPM Solution Sdn
Bhd (“PPMS”). Since then, Mr Wong has played multiple
roles in envisioning, implementing and completing
mega projects undertaken by PPMS. Mr Wong travelled
frequently to the Middle East to explore business
opportunities in the property business for PPMS.
In year 2005, he joined Tamouh Investments LLC, a
business incorporated in Abu Dhabi, the United Arab
Emirates. As a pioneer employee and Deputy Project
Director, he led multi-disciplinary international consortium
to deliver the first master plan and urban guideline for
a multi-billion dollar island development project in Abu
Dhabi. After delivering the master plan in year 2006, he
concentrated on the first property development project
on the island, ie, Marina Square Abu Dhabi, which is
a mixed development comprising office tower, hotel,
residential towers and waterfront shopping mall facing
the marina. He returned to Malaysia in year 2012 upon
completion of the projects.
Mr Wong does not have any conflict of interest with our
Mr Wong does not hold any directorship in public
Ms Ju is a qualified Management Accountant of The
Chartered Institute of Management Accountants, United
Kingdom and a Chartered Accountant of the Malaysian
Institute of Accountants.
She started her career in year 1994 with an accounting
firm in Singapore. She returned to Malaysia in year 1997
and joined a software solution company in Kuala Lumpur
as an Internal Auditor before she took up the role as
Accountant of that Company. For career advancement,
she left the company to join Asia Pacific Land Berhad
(“AP Land”) formerly a public listed company, as the
Accountant in charge of their leasing & mall management
division. She subsequently took charged of the property
development division when AP Land launched its
maiden project in Rawang, Selangor. In year 2001, she
joined Malton Berhad (“Malton”) a property developer
company listed on Bursa Malaysia Securities Berhad,
as an Accountant. She was promoted to the position of
Senior Accountant before her further promotion to Group
Financial Controller, a position she held for more than
6 years. She left Malton in year 2012 following a family
commitment and moved to Qingdao, China before
returning to Malaysia in August 2015.
Having vast experience in property development
companies, she brought with her a robust knowledge of
the industry in relation to statutory reporting requirements
and compliances to our Group.
Ms Ju does not have any conflict of interest with our
Company and she has no family relationship with any
Ms Ju does not hold any directorship in public companies
and public listed companies. She has no conviction for
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Lee Chin Aik
Ching Ai Hooi
Personal Assistant to Group Chief Executive Officer
General Manager (Business Development)
Lee Chin Aik, aged 46, a Malaysian, male, is the Personal
Assistant to our Group Chief Executive Officer. He joined
our Group in June 2011 as a Financial Controller, and
was later promoted to the position of Chief Financial
Officer in September 2011, before assuming his current
position on 1 May 2013.
Ching Ai Hooi, a Malaysian, aged 37, female, is the
General Manager (Business Development) of our Group.
She graduated from the Institute Perkim Goon as an
affiliate member of the Association of Chartered Certified
Accountants (“ACCA”), United Kingdom, in year 2000.
Her career started in year 2000 when she joined Ernst
& Young’s Assurance and Advisory Business Services
unit and gained experience in auditing both local and
multinational companies’ operations.
A Chartered Accountant of Malaysian Institute of
Accountant since year 1999, Mr Lee graduated with a
Bachelor of Accountancy from Universiti Utara Malaysia.
He began his career in year 1995 with an international
accounting firm, Arthur Andersen & Co. In June 2000, he
joined Gold Bridge Engineering & Construction Berhad, a
public listed company involved in property development,
as its Group Accountant and was subsequently promoted
to the position of Financial Controller.
In November 2006, he joined a veteran shipbuilding
company, Nautica Nova Shipbuilding & Engineering Sdn
Bhd (formerly Hong Leong Lurssen Shipyard Sdn Bhd)
as its Financial Controller cum Director handling financial
matters and operations management prior to joining our
Group.
Mr Lee does not have any conflict of interest with our
Mr Lee does not hold any directorship in public companies
Ms Ching joined our Group in year 2004 as Finance
Officer and was subsequently promoted to the position
of Senior Finance Officer the same year. She was
promoted to Management Accountant in year 2007 and
thereafter to Senior Management Accountant in year
2010. Ms Ching took up the challenge to set up our
Group’s Internal Audit Department when Ivory Properties
Group Berhad was listed on Bursa Malaysia Securities
Berhad in year 2010. Her role changed again in year
2014 when she was promoted to the position of General
Manager (Business Development) on 1 Feb 2014 to
analyse, assess and improve our Group’s financial and
operational performance. Her responsibilities include
developing, implementing and monitoring our Group’s
business units’ targets. Ms Ching is currently a member
of the Malaysian Institute of Accountants and the ACCA.
Ms Ching does not have any conflict of interest with
our Company and she has no family relationship with
Ms Ching does not hold any directorship in public
companies and public listed companies. She has no
annual report 2016
CORPORATE GOVERNANCE STATEMENT
The Board of Directors (“the Board”) of Ivory Properties Group Berhad (“Ivory”) recognises the importance of
adopting the principles and recommendations of the Malaysian Code on Corporate Governance (Revised 2012)
(“the Code”) for long term sustainable business growth and to protect and enhance shareholders’ values.
Accordingly, the Board supports the principles laid out in the Code.
The Board is pleased to disclose below the manner in which it has applied the principles and recommendations
of good corporate governance set out in the Code and except as stated otherwise, its compliance with the same
as well as the relevant provisions in the Main Market Listing Requirements of Bursa Malaysia Securities Berhad
(“Listing Requirements”).
Principle 1
Establish Clear Roles and Responsibilities
1.1
Clear Functions of the Board and Management
The Board leads and controls the Group. To ensure effective discharge of its leadership role and as part
of initiative to enhance accountability, the Board delegates specific powers to the Board Committees, the
Chairman, the Group Chief Executive Officer (“CEO”) and the Management. The Company has adopted
a Board Charter which clearly sets out the role, duties, functions and responsibilities of the Board. The
demarcation of roles established in the Board Charter is the reference point (in relation to the Directors and
Board's roles, powers, duties and functions) to guide Board activities and help to reinforce the supervisory
role of the Board.
The Board assumes the following responsibilities for the Group: determining strategic direction, overseeing
the proper conduct of the Group’s business, identifying principal risk and ensuring the implementation of
systems to manage risks, succession planning, developing investor relations programme, reviewing the
adequacy and integrity of the Group’s internal control systems and management information systems,
establishing goals for management and monitoring the achievement of these goals.
The Audit Committee, Remuneration Committee and Nominating Committee (“Committees” or “Board
Committees”) operate within defined terms of reference that have been drawn up in accordance with
the best practices prescribed by the Code. The Committees function primarily to assist the Board in the
execution of its duties and responsibilities in order to enhance business and operational efficiency as well as
efficacy. Deliberation and decisions at Committee level are recorded. The Committee Chairman will report
to the Board on the outcome of the Committees’ meetings and the minutes of meetings are circulated to the
Board. The Board reviews the Committees’ authority and terms of reference from time to time to ensure its
relevance and to enhance its efficacy. The terms of reference of the Board Committees are available at the
Group’s website at www.ivory.com.my.
The Board retains full responsibility for the direction and control of the Company and the Group. The
ultimate decision on all matters lies with the Board.
1.2
Clear Roles and Responsibilities
The Board is collectively responsible for oversight and overall management of the Group. It is charged
with leading and managing the Company in an effective and responsible manner. Each Director has a
legal duty to act in the best interest of the Company. The Group CEO assisted by the Executive Director
and key senior management are responsible for the day-to-day operational management of the Group to
ensure high level of work efficiency and optimum productivity and represent Management to the Board.
The presence of the Independent Non-Executive Directors (“INEDs”), who are not engage in the daily
management of the Group, brings objectivity and independence to any evaluation of strategic, performance
or resources related issues. In this manner, the INEDs fulfill a crucial corporate accountability role as they
provide independent and objective views, opinions and judgment on issues being deliberated.
The Executive Directors work within their position descriptions and key performance indicators have been
adopted for which the Group CEO and the Executive Director are responsible to meet.
41
42
Principle 1
1.2
Clear Roles and Responsibilities (cont'd)
It is the practice of the Board to deliberate on significant matters that concerned the overall Group business
strategy, acquisition or divestment policy, approval of major capital expenditure, consideration of significant
financial matters and review of the financial and operating performance of the Group.
1.3
Formalise Ethical Standards through a Code of Conduct and Ethics
The Group’s Handbook for Employees (“Handbook”) continues to govern the standards of ethics and
good conduct expected of Directors and employees. In addition, the Directors are also governed by a
Code of Conduct and Ethics which includes principles relating to their duties, conflict of interest and
dealings in securities. For employees, the Handbook covers the general employment terms and conditions,
compensation and benefits, proprietary information, conflict of interest, indulging in private businesses,
acceptance of gifts and sexual harassment.
Through the Code of Conduct and Ethics and the Handbook, the Board sets the tone for proper ethical
behavior expected of the Board members and the employees. The Code of Conduct and Ethics is available
at the Company’s website at www.ivory.com.my.
The Board is of the view that there is no necessity to establish a separate whistleblowing policy at the
moment in light of the Whistleblower Protection Act which came into effect in 2010.
1.4
Strategies Promoting Sustainability
The Board reviews the Group’s strategic project development and operational progress to-date on quarterly
basis with due regard to changing business environment and risk factors such as competition, commodities
and changes to governmental policies. At the same meeting, the Board received and ratified reports on
capital expenditures.
The Board is aware of the importance of business sustainability in general and vis a vis the environment,
governance and social context. There is an internal guideline which emphasises good quality designs and
sub-contracting work to protect our development value and ultimately, the investors and homeowners.
The many accolades received by the Group over the years reflect the Group’s commitment to quality and
responsible business management practices.
The Board actively encourages management and staff participation at community events. The set-up of
Ivorycares, the charitable arm of the Group, evidences the Group’s commitment towards social uplifting
activities within the communities where the Group operates.
The Group continuously strive to improve the welfare and benefits provided to its employees. Recruits
undergo induction program to familiarise themselves with the Group’s background, policies and structure,
products and services. The Group has in place performance review process to reward deserving employees
with competitive remuneration packages, increment and bonus. In addition, confirmed employees are
entitled to medical and hospitalisation benefits and senior executives enjoy regular health screening
programme at the Group’s expense. The Group believes that healthy employees are a boon to the Group.
There is emphasis on employees’ training and professional development. Management organises
workshops and study tours from time to time for eligible employees to enhance their skills and knowledge.
Interest free study loans are also made available to employees to encourage them to further their education.
annual report 2016
Principle 1
1.4
Strategies Promoting Sustainability (cont'd)
On a social note, company dinners are organised to foster greater relationship amongst employees and
management. 5-year and 10-year long service awards are conferred to employees as a token of appreciation
for their dedication, loyalty and contribution to the Group.
All the projects undertaken by the Group are properly sanctioned with its progress monitored by the various
legislating authorities.
The Board is committed to promoting sustainability in all the Group’s activities and a Sustainability Policy
will be addressed in due course.
1.5
Access to Information and Advice
All Directors are supplied with full and timely information with Board papers distributed at least 7 days in
advance of meetings or a shorter time period where unavoidable, in order for the Directors to be properly
briefed and to allow the Directors time to deliberate on issues to be raised and discussed at each meeting.
Information given is inclusive of agenda and reports relevant to the issues of the meeting covering areas of
financial, operational and regulatory compliance. In the event where convening of physical meeting is not
conducive owing to timeliness, conference calls are set up to facilitate the Board’s understanding of any
proposals and to receive their approval for the same.
Meeting papers on issues or corporate proposals which are deemed confidential and sensitive would only
be presented to the Directors during the meeting itself. Minutes of previous Board and Committees meetings
are also circulated to the Board for their information. Verbal explanations and briefings are also provided by
Executive Directors, management and external consultants to enhance understanding of matters in relation
to the Group’s business and operations.
The Directors may seek advice from the Management on issues under consideration. The Directors may
also interact with the Management or request further clarifications or information on the Group’s operations
or business concerns. The Directors review and approve corporate announcements, including the
announcement of the quarterly financial reports and audited financial statements, prior to releasing them to
Bursa Malaysia Securities Berhad (“Bursa Securities”). All Directors have access to the advice and service
of the Company Secretaries who are responsible to ensure that all Board procedures are followed and that
applicable rules and regulations are complied with.
The Board of Directors, whether as a full board or in their individual capacity, may upon approval of the
Board of Directors, seek independent professional advice if required, in furtherance of their duties, at the
Group’s expense.
1.6
Qualified and Competent Company Secretaries
The current Company Secretaries are suitably qualified, well experienced, competent and can support the
Board in carrying out its roles and responsibilities. The Company Secretaries are Associate and Fellow
members of the Malaysian Association of the Institute of Chartered Secretaries and Administrators. The
Company Secretaries play advisory role to the Board with regards to its constitution, compliance with
regulatory requirements, codes, guidance and legislations. The Company Secretaries kept themselves
abreast with regulatory changes and updated company secretarial practices by attending relevant training
programmes regularly. The Articles of Association specifies that the removal of the Company Secretaries
is a matter for the Board as a whole.
43
44
Principle 1
1.6
Qualified and Competent Company Secretaries (cont'd)
The Company Secretary or her representative is present at meetings to record deliberations, issues
discussed and conclusions in discharging her duties and responsibilities and also advises on issues
relating to the relevant rules and regulations that govern the Company.
1.7
Board Charter
The Board Charter (“Charter”) guides the Board activities as recommended by the Code. The Charter has
been formalised to clearly define the roles of the Board, Board Committees and Management so that there
is a structured guide with regard to the various responsibilities including the need for Directors to carry out
their leadership and supervisory role and in discharging their duties towards the Group and the Board. The
Charter will be reviewed from time to time to ensure its compliance with relevant rules and regulations and
remains relevant and effective.
Principle 2
Strengthen Composition
2.1
Nominating Committee
The Nominating Committee, which was established by the Board on 9 July 2010, comprises the following:
• Lim Hock Siu - Chairman (INED)
• Loh Chye Teik - Member (INED)
• Ooi Choi Kiat - Member (Non-INED)
The Nominating Committee is chaired by an INED and the Committee consists entirely of Non-Executive
Directors, a majority of whom are independent. The Committee meets at least once a year. Additional
meetings are convened as and when the need arises.
2.2
Develop, Maintain and Review Criteria for Recruitment and Annual Assessment of Directors
The Nominating Committee operates within defined terms of reference that has been drawn up in accordance
with the best practices prescribed by the Code. The terms of reference is available at the Group’s website
at www.ivory.com.my.
The Nominating Committee is empowered by the Board to, amongst others, identify and recommend
to the Board suitable candidates for appointment to the Board and Board Committees, re-election and
re-appointment of Directors, review the independence of Directors as well as the Board structure, size
and composition and determining the impact of the number on its effectiveness as well as considering the
Board’s succession planning and training programmes. The Board is responsible for succession planning
of Board members including Group CEO and overseeing the identification and development of executive
talent. The Board, with the assistance of the Nominating Committee and working with the Group CEO and
Human Resources department, oversees executive officer development and corporate succession plan for
the Group CEO to provide for continuity in senior management. The succession plan covers identification
of internal candidates, development plans for internal candidates, and appropriate identification of external
candidates if necessary. The succession plan will be regularly reviewed and updated to ensure the Group
re-assess the hiring needs and determine the development progress of selected candidates.
annual report 2016
Principle 2
2.2
Develop, Maintain and Review Criteria for Recruitment and Annual Assessment of Directors (cont'd)
The Nominating Committee also assesses the effectiveness of the Board, the Committees of the Board
and contribution of each individual Director on an annual basis. Additionally, the Committee also reviews
the required mix of skills, experience, character, integrity, time commitment and other qualities, including
core competencies of the members of the Board. The Board Members have attended a diverse range of
training programmes during the financial year to enhance their knowledge and skills in specific areas. All
assessments and evaluations carried out by the Nominating Committee in the discharge of all its functions
were documented. The Company Secretary will ensure that all appointments are properly effected with the
necessary legal and regulatory obligations duly met.
A meeting was held during the financial year ended 31 March 2016 and it was attended by all members.
The Committee conducted annual assessment on each individual Director, Board as a whole and Board
Committees. The Committee also reviewed the independence of the Independent Non-Executive Directors
and was satisfied with the level of independence demonstrated by the respective Directors. The INEDs have
satisfied the test of independence as defined under paragraph 1.01 and Practice Note 13 of the Listing
Requirements.
The Board acknowledges the recommendation of the Code on gender diversity. However, the Board
believes it is not necessary to adopt a formal gender diversity policy as the Group is committed to provide
fair and equal opportunities and nurturing diversity, be it race, age, ethnicity or gender, within the Group.
The evaluation of the suitability of candidates is based on the candidates’ competency, character, time
commitment, integrity, performance and experience to bring value and expertise to the Board. The
Nominating Committee will, however, continue to take steps to ensure suitable women candidates are
sought as part of its recruitment exercise.
The Board, together with Nominating Committee, will also formalise a guide to be used during annual
assessment and recruitment process of Directors.
The Committee meets at least once a year. Additional meetings are convened as and when the need arises.
2.3
Remuneration Policies
The Remuneration Committee, which was established by the Board on 9 July 2010, comprises the following:
• Lim Hock Siu
• Loh Chye Teik
• Dato’ Low Eng Hock
- Chairman (INED)
- Member (INED)
- Member (Group CEO)
The Remuneration Committee is chaired by an INED and consists mainly of INEDs.
The Committee meets at least once a year. Additional meetings are convened as and when the need
arises. A meeting was held during the financial year ended 31 March 2016, which was attended by all
members, to consider remuneration package and employment related matters of the Executive Directors.
The Remuneration Committee also discussed and adopted key performance indicators for the Executive
Directors which shall be used as a basis for performance assessment.
The Remuneration Committee is responsible for, inter alia, recommending to the Board the policy framework
and remuneration structure for Directors as well as the remuneration packages for Executive Directors.
45
46
Principle 2
2.3
Remuneration Policies (cont'd)
The Executive Directors did not participate in any way in determining their individual remuneration. The
Board, as a whole, determines the remuneration of NEDs with individual Directors abstaining from decisions
in respect of their individual remuneration.
The current practice is for Directors’ remuneration to be based upon individual contributions, experience,
responsibilities and core competencies with the quantum sufficient to attract, retain and motivate Directors
of the quality required to manage the businesses of the Group and to align the interest of the Directors with
those of the shareholders. Internal reviews were carried out on remuneration of directors of other public
listed companies of similar size and industry with the Group for comparison and guidance to ensure that
the Directors’ remuneration stay competitive and reflect the prevalent market rate.
All NEDs are paid fixed annual fees which are determined by the Board as a whole. In addition to the fixed
annual fees, all NEDs are paid meeting allowances for attending meetings. The Directors’ fees are approved
annually by the shareholders. The details of the remuneration received by the Directors for the financial year
ended 31 March 2016 are as follows:
Directors
Salaries
RM’000
Fees
RM’000
Other
Emoluments
RM’000
Total
RM’000
Executive
1,891
-
949
2,841
-
195
25
200
Non-Executive
The number of Directors, whose remuneration falls into the following bands, comprises:
Number of Directors
Range of Remuneration (RM)
Executive
Non-Executive
50,000 and below
-
3
50,001 - 100,000
-
1
300,000 – 350,000
1
-
2,500,001 – 2,550,000
1
-
The Board is of the opinion that the above disclosure is sufficient as it considers the disclosure of each
Director’s remuneration will not add significantly to the understanding and evaluation of the Group's
governance process. None of the Directors has rendered any services to the Company or any companies
within the Group during the financial year.
Principle 3
Reinforce Independence
3.1
Annual Assessment of Independent Directors
The Board, through the Nominating Committee, assesses the INEDs annually. Based on the assessment
carried out annually, the Nominating Committee and the Board are satisfied with the level of independence
demonstrated by the INEDs and their ability to act in the best interest of the Company in decision-making.
annual report 2016
Principle 3
3.2
Tenure of Independent Directors
The tenure of an INED should not exceed a cumulative term of nine (9) years. The Board may, in exceptional
cases and subject to the assessment of the Nominating Committee on an annual basis, recommend for
an INED who has served a consecutive or cumulative term of 9 years to remain as an INED subject to
shareholders’ approval. However, an INED may continue to serve the Board subject to his re-designation
as a Non-INED. As at to-date, none of the INEDs has exceeded the cumulative term of 9 years.
3.3
Shareholders’ Approval for Retaining INEDs
The Board must justify and seek shareholders’ approval in the event that it retains a Director as an INED, a
person who has served in that capacity for more than 9 years. As at to-date, none of the INEDs has served
for more than 9 years.
3.4
Separation of Positions of Chairman and CEO
There is a clear division of responsibilities at Board level to ensure balance of authority and power so
that there is no one individual with unfettered power over decision-making. The Board is helmed by an
Independent Non-Executive Director while the Executive Director & Group CEO led the management team.
The distinct and separate roles of the Chairman and CEO promote accountability and facilitate division of
responsibilities between them. The Group CEO focuses on the day-to-day operations and management of
the Group while the Independent Non-Executive Chairman leads the Board in the oversight of management.
3.5
Composition of the Board
As at to-date, the Board comprises six (6) members; three (3) INEDs, one (1) Non-INED and two (2)
Executive Directors, which is in compliance with the Listing Requirements which requires a Board to
have at least two (2) Independent Directors or 1/3 of the Board of the Directors, whichever is higher to
be Independent Directors. Brief profile of each Board member is presented in this Annual Report under
Profile of Directors. The Directors, with their different background and specialisations, collectively bring
with them a wide range of experience and expertise in areas ranging from finance, corporate affairs, project
development, marketing to general management and operations. The Executive Directors are responsible
for implementing the policies and decisions of the Board, overseeing business operations as well as
coordinating the development and implementation of business and corporate strategies. The INEDs bring
to bear objective and independent judgment to the decision making of the Board and provide a capable
check and balance to the Executive Directors.
The Board, through the Nominating Committee, conducts annual assessment on the effectiveness of the
Board as a whole, the Board Committees and contribution of each individual Director. The assessment
also considered the qualifications, contribution and performance of Directors and Chief Financial Officer in
meeting the needs of the Group based on the criteria - competency, character, time commitment, integrity
and experience as set out under paragraph 2.20A of the Listing Requirements. The evaluation process
is a mix of self and peer review and these were duly documented. Evaluation forms were provided to the
Directors and the Nominating Committee in advance for their assessment. The assessment and comments
were summarised and discussed at Nominating Committee meeting before they were presented to the
Board. The Nominating Committee also discussed and reviewed key performance indicators set for the
Executive Directors for each financial year.
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48
Principle 3
3.5
Composition of the Board (cont'd)
The Articles of Association of the Company provides that at least one-third of the Board is subject to
retirement by rotation at each Annual General Meeting (“AGM”) and all Directors shall retire from office once
at least in every three (3) years. A retiring Director is eligible for re-election. This provides an opportunity for
shareholders to renew their mandates. The re-election of each Director is voted on separately at the AGM.
There is no Director who will be standing for election at the forthcoming AGM of the Company.
Directors over seventy (70) years of age are required to submit themselves for re-appointment annually
in accordance with Section 129(6) of the Companies Act, 1965. However, none of the Directors of the
Company is over 70 years of age.
Principle 4
Foster Commitment
4.1
Time Commitment
The Board meets at least once every financial quarter with urgent and important matters resolved by way of
circular resolutions and convening of additional meetings as and when the need arises. During the financial
year ended 31 March 2016, the Board met on six (6) occasions, where it deliberated upon and considered
various matters including financial and business performance, major investments and divestments, major
acquisitions and disposals, appointment and retirement of Directors, capital expenditure, financial forecast,
related party transactions and recurrent related party transactions, terms of office and performance of the
Audit Committee and its members and re-appointment of Auditors as well as reviewed and approved the
Annual Report and Circular to Shareholders.
The Directors’ attendance at Board Meetings held during the financial year ended 31 March 2016 is as
follows:
Directors
Attendance
6/6
6/6
5/6
Ooi Choi Kiat
6/6
Loh Chye Teik
6/6
Lim Hock Siu
6/6
Board Meetings for the whole year are scheduled ahead at the end of each calendar year to enable the
Directors to plan and adjust their schedule to ensure good attendance and the expected degree of attention
given to the Board agenda. Members of the Management team and external advisors are invited as and
when required to attend the Board of Directors’ and the Committees’ Meetings to present and advise the
members with information and clarification on certain items in the agenda to enable them to arrive at a
considered decision. Directors and principal officers of the Group are also notified on closed periods for
dealings in securities of the Company based on the targeted announcement dates of the quarterly financial
results.
annual report 2016
Principle 4
Foster Commitment
4.1
Time Commitment (cont'd)
All proceedings of the Board and Committee meetings are recorded and the minutes thereof signed by the
Chairman of the respective meetings.
A Director accepting new directorships in other companies will notify the Board of his new appointment.
A Director shall limit his directorship of companies to a number which is in compliance with the Listing
Requirements and at such number that he can best devote his time and effectiveness to the Group. In
general, any new Board appointment would be given background information on the Group and its activities
with site visits arranged as deemed necessary.
4.2Training
All Directors have attended and successfully completed the Mandatory Accreditation Programme.
As part of the initiative to enhance their knowledge and acquire sound understanding of current issues
and developments to effectively discharge their duties, the Directors have attended the following seminars,
workshops and courses during the financial year ended 31 March 2016:
Directors
Seminars/Workshops/Courses
Dr Asairinachan
@ Aravinachan
A/L Kunjamboo
• Risk Management and Internal Control for Audit Committee
• Board Chairman Series Part 2: “Leadership Excellence from the Chair”
• Corporate Governance Breakfast Series with Directors: “The Board’s
Response in Light of Rising Shareholder Engagements”
• 2016 Budget Updates and Recent Developments on Tax / Post Goods and
Services Tax
Services Tax
• Strata Management Workshop
Ooi Choi Kiat
•1st Half Market Outlook
Loh Chye Teik
• Malaysia Goods and Services Tax Compliance Conference: Unraveling
Post-Implementation Complexities
• Goods and Services Tax Latest Developments and The Way Forward
• Understanding Goods and Services Tax Risks
• National Tax Conference 2015
• Quality Control
• Companies Commission of Malaysia National Conference 2015 on
Modernising the Companies Act. Creating Synergy in Malaysian Business
Landscape
• Malaysian Institute of Accountants International Accountants Conference 2015
• Seminar Percukaian Kebangsaan 2015
• Addressing the Top 5 Internal Audit Challenges
• Goods and Services Tax in Practice: A Year and Beyond. The Implementation
of Goods and Services Tax in Retrospect and the Practical Issues and
Solutions Moving On
Lim Hock Siu
Services Tax
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Principle 4
Foster Commitment
4.2
Training (cont'd)
The Company communicates and facilitates the organisation of training programmes for Directors and
maintains a record of the trainings attended by the Directors. On the recommendation of the Nominating
Committee, the Directors will endeavor to attend more trainings in relation to the Listing Requirements and
property development industry. In addition, the Directors are regularly updated by the Company Secretaries
on any changes to the statutory, corporate and regulatory requirements relating to Directors' duties and
responsibilities or the discharge of their duties as Directors. The external auditors have also briefed the Board
on changes to the Malaysian Financial Reporting Standards that affect the Group's financial statements.
Principle 5
Uphold Integrity in Financial Reporting
5.1
Compliance with Applicable Financial Reporting Standards
The Board aims to provide and present a clear, balanced and comprehensive assessment of the Group’s
financial performance and prospects, primarily through the annual and quarterly financial statements to
Shareholders as well as the Chairman’s Message in the Annual Report. The Board is assisted by the Audit
Committee to oversee the Group’s financial reporting processes, ensures its compliance with applicable
financial reporting standards and regulatory requirements as well as the quality of its financial reporting.
The financial statements are reviewed by the Audit Committee prior to recommending them to the Board for
announcement and issuance to shareholders.
The Board is responsible for ensuring that the financial statements give a true and fair view of the state
of affairs of the Group and of the Company as at the end of the financial year and of the results of their
operations and cash flows for the year ended on that date. The Directors have ensured that the financial
statements of the Group and of the Company are drawn up in accordance with the requirements of the
applicable approved accounting standards for entities other than private entities issued by the Malaysian
Accounting Standards Board and the provisions of the Companies Act, 1965.
In preparing the financial statements, the Directors have selected and applied consistently suitable
accounting policies and made reasonable and prudent judgment and estimates. The Directors also have a
general responsibility for taking reasonable steps to safeguard the assets of the Group and to prevent and
detect fraud and other irregularities.
5.2
Assessment of Suitability and Independence of External Auditors by the Audit Committee
During the financial year ended 31 March 2016, the Independent Directors held two (2) dialogue sessions
with the external auditors in the absence of the Executive Directors and Management to discuss issues of
concern to the external auditors. The issues discussed were highlighted by the Committee Chairman to the
Board.
The Group maintains a close and transparent relationship with its external auditors in seeking professional
advice and ensuring compliance with the relevant accounting and financial reporting standards. The
external auditors have an obligation to bring to the attention of the Audit Committee, the Board and the
management any significant defects in the Group's system of reporting, internal control, compliance with
approved accounting standards as well as legal and regulatory requirements.
annual report 2016
Principle 5
Uphold Integrity in Financial Reporting
5.2
Assessment of Suitability and Independence of External Auditors by the Audit Committee (cont'd)
The Audit Committee also undertook an assessment of suitability and independence of the external auditors
through a performance and independence checklist. The checklist includes inter alia, the external auditors’
quality of service, audit team, independence and objectivity, scope of audit and planning, audit fees, nonaudit services provided by the external auditors to the Group and the fees and audit communications. The
Company also has in place an External Auditors Policy which outlines the guidelines and procedures for
the Committee to assess and monitor the external auditors. The Chief Financial Officer, Group Accountant
and other employees involved were also invited to share their views and any issues in respect of the
performance of the external auditors during the financial year. In addition, the external auditors also provided
written assurance of their independence throughout the term of their audit engagement in accordance with
the terms of the relevant professional and regulatory requirements including the bye-laws of the Malaysian
Institute of Accountants. The lead audit engagement partner responsible for the Company’s financial
statements is subject to a maximum five year rotation period and rotation has taken place twice since the
Company’s initial engagement of the external auditors. The Committee was satisfied with the technical
competency and independence of the external auditors during the financial year ended 31 March 2016 and
recommended their re-appointment to the Board.
Principle 6
Recognise and Manage Risks
6.1
Sound Framework to Manage Risks
The Board is updated on the Group’s internal controls system which encompasses risk management
practices as well as financial, operational and compliance controls on a quarterly basis. Ongoing reviews
are performed throughout the year on a quarterly basis to identify, evaluate, monitor and manage significant
risks affecting the business and ensure that adequate and effective controls are in place. Such continuous
review processes are conducted by independent professional firm of consultants. The findings of the
internal audit function are regularly reported to the Audit Committee. An overview of the state of internal
controls and risk management within the Group is spelt out in this Annual Report under the Statement on
Risk Management and Internal Control.
6.2
Internal Audit Function
The function of internal audit is outsourced to an independent professional firm of consultants to assist the
Audit Committee in discharging its roles and responsibilities. Details of the Group’s internal control system
and risk management framework are set out under the Statement on Risk Management and Internal Control
and Audit Committee Report in this Annual Report.
Principle 7
Ensure Timely and High Quality Disclosure
7.1
Corporate Disclosure Policy
The Board is mindful of the requirement for prompt dissemination of information to shareholders, investing
community and authorities to ensure clear and complete information of the Group’s position and financial
performance are given in a timely manner within the bounds of practicality and regulatory framework
governing release of material and price sensitive information.
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52
Principle 7
Ensure Timely and High Quality Disclosure
7.1
Corporate Disclosure Policy (cont'd)
The Board will review through and endorse all announcements prior to release to the public through Bursa
Securities. In addition, all financial related announcements are pre-approved by the Chief Financial Officer
before these are submitted to the Board for endorsement.
Following increased awareness for greater accountability and transparency in disclosure, the Board has
formalised its current disclosure practice into a policy in line with the provisions of Listing Requirements,
to enable comprehensive, timely and accurate disclosure to the regulators, shareholders and other
stakeholders. The policy also sets out the spokespersons authorised to communicate with the regulatory
bodies, investment analysts, potential investors, media or other parties on behalf of the Group. The
Corporate Disclosure Policy is available at the Group’s website at www.ivory.com.my.
7.2
Leverage on Information Technology for Effective Dissemination of Information
The Company’s website, www.ivory.com.my, provides an avenue for comprehensive information
dissemination with dedicated sections on corporate information including announcements to Bursa
Securities, financial information, annual reports, governance, press releases and news and events related
to the Group. Moving forward, in accordance with paragraph 9.21(2)(b) of the Listing Requirements, the
Company will be publishing a summary of the key matters discussed at the Company’s AGM as soon as
practicable after the conclusion of the AGM for the benefit of shareholders who were unable to attend the
AGM.
Any queries or concerns regarding the Group may be directed to Investor Relations via its dedicated email
address at [email protected].
Principle 8
Strengthen Relationship between Company and Shareholders
8.1
Shareholders’ Participation at General Meetings
General meetings are the key platform for the Board to meet the shareholders and for the Board to provide
an overview of the Group’s progress to-date and respond to questions from shareholders concerning the
Group’s business, operations and prospects. Every notice convening general meeting specifying the place,
day and hour of meeting is given to all members at least 14 days before meeting or at least 21 days before
the meeting where any special resolution is to be proposed or where it is an AGM.
Shareholders may also obtain the Group’s latest announcements through its corporate website at
www.ivory.com.my or Bursa Securities’ website at www.bursamalaysia.com.
The Board will consider adopting electronic voting, within the bound of practicability, in the future to facilitate
greater shareholder participation at general meetings.
8.2
Poll Voting
The Company will ensure that all resolutions set out in the notice of general meetings, or in any notice of
resolution which may properly be moved and is intended to be moved at any general meeting, is voted by
poll. Poll voting will reflect shareholders’ views more accurately and fairly by ensuring that every vote is
recognised in accordance with the principle of “one share one vote”.
annual report 2016
Principle 8
Strengthen Relationship between Company and Shareholders
8.3
Effective Communication and Proactive Engagement
The Board acknowledges the need for shareholders to be kept informed of all material business matters
affecting the Group. Shareholders are provided with an overview of the Group’s performance and
operations through timely release of financial results on yearly and quarterly basis as well as various other
announcements.
The general meetings also provide a useful forum for shareholders to engage directly with the Board and
senior management. The shareholders are at liberty to raise questions or seek clarification on the agenda
of the meeting from the Board and the senior management.
Press conferences are also held to brief members of the media on key events involving the Group. In
addition, throughout the year, the Group has programmes for meetings or interviews with the investment
community and the media. The Group also issues press releases to the media, as part of its corporate
initiative to promote wider publicity and dissemination of public information, on significant corporate
developments and business initiatives to keep the investment community and shareholders updated on the
progress and development of the Group.
Whilst the Group endeavors to provide as much information as possible to the shareholders and stakeholders,
the Board is mindful of the legal and regulatory framework governing the release of material and pricesensitive information. Such material and price-sensitive information are not released until announced or
made public through the proper channels.
Compliance with the Principles and Recommendations of the Code
For the financial year ended 31 March 2016 and until todate, the Group has complied substantially with the
Principles and Recommendations of the Code insofar as applicable and described herein.
This statement is issued in accordance with a resolution of the Directors dated 25 July 2016.
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54
AUDIT COMMITTEE REPORT
The Audit Committee of the Company which comprises of majority Independent Non-Executive Directors,
was established on 9 July 2010 to assist the Board in the effective discharge of its fiduciary responsibilities:Chairman
Loh Chye Teik
- Independent Non-Executive Director
Members
Lim Hock Siu
Ooi Choi Kiat
- Chairman / Independent Non-Executive Director
- Independent Non-Executive Director
- Non-Independent Non-Executive Director
AUDIT COMMITTEE MEETING
During the financial year ended 31 March 2016, a total of five (5) meetings were held, ie, on 28 May 2015,
30 July 2015, 27 August 2015, 26 November 2015 and 23 February 2016 and the Committee Members
attended all the meetings. Minutes of the Committee meetings were circulated to the Board of Directors.
SUMMARY OF WORK OF AUDIT COMMITTEE
The Audit Committee assists the Board of Directors in fulfilling its overseeing responsibilities. The Committee’s
overall responsibilities encompass the processes of audit, corporate accounting, financial reporting, system
of internal control, risk management, regulatory and legal compliances and risk management practices and
procedures of the Group.
The work of the Audit Committee for the financial year ended 31 March 2016 is summarised as follows:Financial Reporting
• Reviewed the quarterly unaudited financial reports for the financial quarters ended 31 March 2015,
30 June 2015, 30 September 2015 and 31 December 2015 and the annual audited financial statements
of the Group and its related notes to financial statements for the financial period ended 31 March 2015
as well as appropriate announcements to Bursa Malaysia Securities Berhad (“Bursa Securities”) and
Securities Commission (“SC”) before recommending to the Board of Directors for approval.
• In the review of the quarterly unaudited financial reports and annual audited financial statements, the
Committee discussed with management and the external auditors, amongst others, the major accounting
principles and policies that were applied and the reasonableness of their judgments and estimations made
in connection with the preparation of the financial statements and the clarity of disclosures of the same.
• Confirmed with management and the external auditors that the Company’s and Group’s annual audited
financial statements have been prepared in compliance with applicable Financial Reporting Standards.
External Audit
• Reviewed and endorsed the audit plan presented by the external auditors which comprised amongst
others, the engagement team, audit strategy, audit methodology, audit materiality, preliminary audit risk
assessment, general extent of the auditors’ audit examinations, timetable and scope of the audit work for
the year.
• Considered and reviewed, where applicable, the significant impact on the Group’s financial statements as
a result of new accounting standards issued by the Malaysian Accounting Standards Board as highlighted
by the external auditors.
• Reviewed the findings of the external auditors’ reports, particularly the issues raised in the management
letter and the response from the management to ensure where appropriate, the necessary corrective
actions had been taken by management.
annual report 2016
• Considered and reviewed the external auditors evaluations of the Group’s internal control to ensure
effective and efficient processes and controls were in place for the overall quality of the Group’s financial
reporting. The Committee took into consideration the external auditor’s view on method used to account
for significant or unusual transactions where the accounting treatment is open to interpretation or requires
certain judgments when assessing the reasonableness of the management judgments and estimates in
adopting the appropriate accounting treatment.
• Met with the external auditors without the presence of the Executive Directors and management staff on
28 May 2015 and 23 February 2016 to discuss issues of concern to the auditors. The issues discussed
were then highlighted by the Committee Chairman to the Board.
• Reviewed and considered the performance and independence of the external auditors for the financial
year through a performance and independence checklist. The checklist includes inter alia, the external
auditors’ quality of service, audit team, independence and objectivity, scope of audit and planning,
audit fees, non-audit services provided by the external auditors to the Group and the fees and audit
communications. The Chief Financial Officer, Group Accountant and other employees involved were
also invited to share their views and any issues in respect of the performance of the external auditors
during the financial year. In addition, the external auditors also provided written assurance that they have
been independent throughout the term of their audit engagement in accordance with the terms of the
relevant professional and regulatory requirements including the bye-laws of the Malaysian Institute of
Accountants. The lead audit engagement partner responsible for the Company’s financial statements is
subject to a maximum five year rotation period and rotation has taken place twice since the Company’s
initial engagement of the external auditors. The Committee was satisfied with the performance and
independence of the external auditors and recommended their re-appointment to the Board.
Subsequent to the financial year, a policy on external auditors was established to outline the guidelines
and procedures for the Committee to assess the suitability and independence of the external auditors and
monitor the performance of the external auditors based on quality of service, sufficiency of resources,
communication and interaction and professional skepticism.
• Considered the audit fees and non-audit fees to be paid to the external auditors for the financial year.
The Committee was presented with an internal review and comparison of the external auditors fees
against the audit fees of other public listed companies of similar size and nature with the Group. The
non-audit fees comprised of recurring fees on corporate tax compliance, annual review of the Statement
on Risk Management and Internal Control (“SORMIC”), compliance of Housing Development (Control
and Licensing) Act 1966, review of realised and unrealised profit and limited review of quarterly financial
reports while the non-recurring fee was for the consultancy services on Goods and Services Tax related
issue.
• Recommended the proposed audit fee and the external auditors’ reappointment for Board’s approval.
Internal Audit and Risk Management
• Reviewed and evaluated the performance and functions of the internal auditors for the financial year
through an evaluation checklist which includes inter alia the scope and functions of the internal auditors,
internal auditors understanding of the Group’s business and its industry, manpower, budget, competency
and performance of the internal auditors and collaboration of the internal auditors with the external
auditors.
• Subsequent to the financial year, assessed the adequacy and effectiveness of the Enterprise Risk
Management (“ERM”) framework, the systems of internal controls and the appropriateness of
management’s responses to key risk area and proposed recommendations for improvements to be
implemented.
• Reviewed and approved the annual audit plan proposed and recommended by SORMIC Committee to
ensure the adequacy of the scope and coverage of work.
• Reviewed the ERM reports, internal audit reports, the audit issues therein, recommendations and management’s
response before proposing that those control weaknesses be rectified and recommendations for improvements
be implemented. The ERM reports, internal audit reports, audit issues, recommendations and management’s
response were discussed at the SORMIC Committee Meeting prior to circulation and review by the Committee.
The SORMIC Committee comprises of an Executive Director, Chief Financial Officer, Chief Operating Officer,
Group Accountant, Personal Assistant to the Group Chief Executive Officer and General Manager (Business
Development).
55
56
• Reviewed and recommended for approval of the Board of Directors the SORMIC and the Audit Committee
Report.
• Reviewed the recurrent related party transactions of a revenue or trading nature and other related party
transactions entered into by the Group. The Directors provide and update the Group on quarterly basis
all persons connected with them to assist the Group in monitoring and identifying any potential related
party transactions or conflict of interest situations within the Group. Lists of all recurrent related party
and other related party transactions containing details of the related parties, date of transactions, nature
of transactions and amount of transactions were compiled and provided to the Committee on quarterly
basis to assist the Committee in the review of the transactions. In reviewing related party transactions, the
Committee ensured that the transactions are fair and were conducted on terms not more favourable to the
related parties than those generally available to the public, and are not to the detriment of the minority
shareholders. The Committee also considered if the actual value of recurrent related party transactions
entered into by the Company, exceed the estimated value of the recurrent related party transactions
disclosed in the circular to shareholders by 10% or more, where immediate announcement is required.
The Committee sought explanations and clarifications on the transactions where necessary during the
Meetings.
As additional monitoring measure for the Group, the adopted Code of Conduct and Ethics of Directors
provides inter alia, that a Director should seek to avoid engaging in any business or work which may be
in competition or in conflict directly or indirectly with the business of the Group. Full and prior disclosure
of any conflict or potential conflict must be made to the Board. Where an actual or potential conflict does
arise, a Director should refrain from participating in the debate and/or vote on the matter, and in the
extreme case of continuing material conflict of interest, should resign from the Board.
• Discussed and approved draft circular to shareholders in relation to proposed renewal of shareholders’
mandate for recurrent related party transactions of a revenue or trading nature and disposal of land.
INTERNAL AUDIT
During the financial year ended 31 March 2016, the Company had engaged the services of an independent
firm of consultants, BDO Governance Advisory Sdn Bhd, to carry out the internal audit function of the Group
in order to assist the Audit Committee in discharging its duties and responsibilities. The internal audit function
is independent of the activities or operation of the Group. The principal role of the internal audit function
is to undertake independent, regular and systematic reviews of the system of internal control to provide
reasonable assurance that such system continues to operate satisfactorily and effectively.
The summary of internal audit activities is delineated as follows:• Reviewed the existing system of internal controls and governance processes of the Group;
• Conducted audit reviews of the Group’s system of internal controls on reliability and integrity of
financial and operational information, safeguarding of assets, efficiency of operations, compliance with
established policies as well as procedures and statutory requirements;
• Provided recommendations to the management to assist the operations management and Group in
improving and accomplishing its internal control requirements;
• Issued internal audit reports incorporating audit recommendations and management’s responses in
relation to audit findings on internal control weaknesses to the Audit Committee and the respective
operations management;
• Performed follow-up reviews to ensure that corrective actions were implemented effectively; and
• Presented the internal audit report to the Audit Committee on a quarterly basis.
The total cost incurred for the internal audit function of the Group for the financial year ended 31 March 2016
is RM35,200.00.
Further details of the activities of the internal audit are set out in the Statement on Risk Management and
Internal Control in this Annual Report.
annual report 2016
STATEMENT ON RISK MANAGEMENT AND
INTERNAL CONTROL
INTRODUCTION
The Malaysian Code of Corporate Governance 2012 requires listed companies to maintain a sound risk management
and system of internal controls to safeguard shareholders’ investment and the Group’s assets.
Guided by the Statement on Risk Management and Internal Control: Guidelines for Directors of Public Listed
Companies, the Board of Directors of Ivory Properties Group Berhad is pleased to present the Statement on Risk
Management and Internal Control which is prepared in accordance with Paragraph 15.26(b) of the Main Market
Listing Requirements of Bursa Malaysia Securities Berhad.
RESPONSIBILITY FOR RISK MANAGEMENT AND INTERNAL CONTROL
The Board recognises its overall responsibility for the Group’s systems of internal control and for reviewing the
adequacy and integrity of those systems. In view of the limitations that are inherent in any systems of internal
control, the systems of internal control are designed to manage risk within tolerable levels rather than eliminate the
risk of failure to achieve business objectives. Hence, such system by its nature can only provide reasonable and
not absolute assurance against material misstatement, error or losses.
The Board has established an ongoing process for identifying, evaluating and managing the significant risks
faced, or potentially exposed to, by the Group in pursuing its business objectives. This process has been in place
throughout the financial year and up to the date of approval of the annual report. The adequacy and effectiveness
of this process have been continually reviewed by the Board and are in accordance with the Internal Control
Guidance.
RISK MANAGEMENT
The Group has in place an Enterprise Risk Management (“ERM”) system as an integral part of the Group’s daily
operations and long term strategic management practice. This ERM system is a continuous and systematic method
to identify, assess, respond and monitor significant risks affecting the Group’s business and achievement of its
objectives. Risks may be associated with a variety of internal or external factors including control breakdowns,
disruption in information systems, competition, natural catastrophe and regulatory requirements. Existing and
planned controls are also considered in the ERM exercise.
The Group’s Statement on Risk Management and Internal Control (“SORMIC”) Committee is chaired by an
Executive Director and includes representatives from management. The SORMIC Committee meets regularly to
review the effectiveness of the risk management process and reports arising from risk management activities.
To foster greater ownership and effective management of risks, the respective Heads of Departments are primarily
responsible for the identification, evaluation and management of major risks affecting their own business units
including the design and implementation of suitable controls on a continuous basis.
With the assistance of an independent professional accounting and consulting firm, the entire ERM process is
reviewed by the top management in which significant risks which may inflict the Group in the ensuing 12 months
are re-evaluated according to their likelihood of occurrence and severity of consequence. The ERM process
encompasses the processes for the identification, assessment, management and monitoring of risks which could
impact the objectives of the Group. Existing controls to mitigate and manage these risks are then re-assessed and
strengthened.
Risk management is integrated into the Group’s daily operations and a risk based evaluation is taken into
consideration for the Group’s decision making and strategic planning.
57
58
STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL
INTERNAL AUDIT
The Board outsourced its internal audit function to an independent professional accounting and consulting firm,
BDO Governance Advisory Sdn Bhd as part of its efforts to provide adequate and effective internal control systems.
The performance of internal audit function is carried out as per the annual audit plan approved by the Audit
Committee.
On a quarterly basis, the internal auditors report to the Audit Committee on internal audit findings and recommend
remedial action plans for possible improvement for the audited areas. The highlighted internal audit findings are
followed-up by the internal auditors as well to ensure the control weaknesses, if any, are properly identified and
addressed by the management.
During the financial year, the internal audit function reviewed the internal controls in the key activities of the Group’s
businesses on the basis of an annual internal audit plan approved by the Audit Committee. The internal audit
adopted a risk-based approach and prepared its plan based on the risk profiles of the major business units in the
Group. Opportunities for improvement to the system of internal control were identified and presented to the Audit
Committee via internal audit reports, whilst Management formulated the relevant action plans to address the issues
noted.
A total of 4 internal audit reviews were conducted by BDO Governance Advisory Sdn. Bhd. for the financial year
ended 31 March 2016. The details of the said review can be delineated as follows:Internal
Audit Visits
Audit Period
Names of Auditees
Audited Areas
Follow-Up
Reviews
1st Visit in
March 2015
1 October 2014 –
31 March 2015
Ivory Associates Sdn. Bhd.
(The Latitude)
Procure to Pay
June 2015
2nd Visit in
June 2015
1 December 2014 –
30 April 2015
Ivory Properties Group
Berhad
Human Resource
Management
September 2015
3rd Visit in
September 2015
1 April 2015 –
30 September 2015
Ivory Associates Sdn. Bhd.
Sales to Receipt
December 2015
4th Visit in
December 2015
1 July 2015 –
31 December 2015
Ivory Villas Sdn. Bhd.
(The Latitude)
Project
Development
Management
March 2016
The audit focuses on high risk area to ensure that an adequate action plan has been in place to improve the
internal controls. The audit ascertains that the risks are effectively mitigated by the controls. The highlighted areas
will be followed up closely to determine the extent of their recommendations that have been implemented by the
management.
annual report 2016
STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL
INTERNAL CONTROL
Apart from risk management and internal audit, the Group has put in place the following key elements of internal
control:
•
•
•
•
•
•
An organisation structure with well-defined scopes of responsibility, clear lines of accountability, and
appropriate levels of delegated authority;
A process of hierarchical reporting which provides a documented and auditable trail of accountability;
A set of documented internal policies and procedures which is subject to regular review and improvement;
Regular and comprehensive information provided to management, covering financial and operational
performance and key business indicators, for effective monitoring and decision making;
Monitoring of results against project budget, with major variances being followed up and management
action taken, where necessary; and
Regular visits to operating units by members of the Board and senior management.
The Group’s system of internal control does not extend to associate companies and its joint venture as the Group
does not have full management control over them. However, the Group’s interest is represented through the Board
of these associate companies and the joint venture.
REVIEW OF THIS STATEMENT BY EXTERNAL AUDITORS
The external auditors have reviewed this Statement on Risk Management and Internal Control pursuant to the
scope set out in Recommended Practice Guide (“RPG”) 5 (Revised 2015), Guidance for Auditors on Engagements
to Report on the Statement on Risk Management and Internal Control included in the Annual Report issued by the
Malaysian Institute of Accountants (“MIA”) for inclusion in the Annual Report of the Group for the year ended 31
March 2016, and reported to the Board that nothing has come to their attention that cause them to believe that the
statement intended to be included in the Annual Report of the Group, in all material respects:
(a)
has not been prepared in accordance with the disclosures required by paragraphs 41 and 42 of the
Statement on Risk Management and Internal Control: Guidelines for Directors of Listed Issuers, or
(b)
is factually inaccurate.
RPG 5 (Revised 2015) does not require the external auditors to consider whether the Directors’ Statement on
Risk Management and Internal Control covers all risks and controls, or to form an opinion on the adequacy and
effectiveness of the Group’s risk management and internal control system including the assessment and opinion by
the Board of Directors and management thereon. The external auditors are also not required to consider whether
the processes described to deal with material internal control aspects of any significant problems disclosed in the
Annual Report will, in fact, remedy the problems.
CONCLUSION
The Board has received assurance from the Group Chief Executive Officer and Chief Financial Officer that the
Group’s risk management and internal control systems have been operating adequately and effectively, in all
material aspects, during the financial year under review and up to the date of this statement. Taking this assurance
into consideration, the Board is of the view that there were no significant weaknesses in the current system of
internal control of the Group that may have material impact on the operations of the Group for the financial year
ended 31 March 2016. The Board and the management will continue to take necessary measures and ongoing
commitment to strengthen and improve its internal control environment and risk management.
This statement is issued in accordance with a resolution of the Directors dated 30 May 2016.
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60
ADDITIONAL COMPLIANCE INFORMATION
Audit Fees and Non-Audit Fees
The amount of audit fees and non-audit fees paid to the external auditors of the Group, or a firm or corporation
affiliated to the external auditors of the Group, for the financial year ended 31 March 2016 are as follows:Paid By
(i)
Company
(ii)
Group
Audit Fees (RM)
Non-Audit Fees (RM)
35,000
12,000
139,000
38,800
Material Contracts
Other than those disclosed in Note 31 to the Financial Statements in this Annual Report, there were no material
contract (not being contracts entered into in the ordinary course of business) entered into by the Company and its
subsidiaries involving the interest of the Company’s Directors and/or its major shareholders either still subsisting
as at 31 March 2016 or since the end of the previous financial period ended 31 March 2015.
Recurrent Related Party Transactions of a Revenue or Trading Nature
At the Extraordinary General Meeting held on 17 September 2015, the Company obtained shareholders’ mandate to
allow the Directors and/or major shareholders of the Company and its subsidiary companies to enter into recurrent
related party transactions of a revenue or trading nature. There were no recurrent related party transactions
conducted during the financial year ended 31 March 2016 pursuant to the shareholders’ mandate.
FINANCIAL STATEMENTS
62
71
144
Directors’
Report
Consolidated
Statement of
Changes in
Equity
Statement
by Directors
72
Statutory
Declaration
67
Consolidated
Statements
of Financial
Position
69
Statement of
Changes in
Equity
73
Statement
of Financial
Position
Statements of
Cash Flows
70
76
Statements
of Profit or
Loss and Other
Comprehensive
Income
Notes to the
Financial
Statements
145
146
Independent
Auditors’ Report
62
DIRECTORS' REPORT
For The Year Ended 31 March 2016
The Directors have pleasure in submitting their report and the audited financial statements of the Group and of the
Company for the financial year ended 31 March 2016.
Principal activities
The Company is principally engaged in investment holding and provision of management and marketing services,
whilst the principal activities of the subsidiaries are as stated in Note 6 to the financial statements. There has been
no significant change in the nature of these activities during the financial year.
Results
Group
RM’000
Company
RM’000
Profit for the year attributable to :
Owners of the Company
Non-controlling interests
10,543
(149)
19,449
-
10,394
19,449
Reserves and provisions
There were no material transfers to or from reserves and provisions during the financial year under review.
Dividend
No dividend was paid since the end of the previous financial period and the Directors do not recommend any
dividend to be paid for the financial year under review.
Directors of the Company
Directors who served since the date of the last report are :
Dr. Asairinachan @ Aravinachan A/L Kunjamboo
Loh Chye Teik
Ooi Choi Kiat
Lim Hock Siu
annual report 2016
DIRECTORS' REPORT
Directors’ interests in shares
The interests and deemed interests in the ordinary shares and warrants of the Company and of its related
corporations (other than wholly-owned subsidiaries) of those who were Directors at financial year end (including
the interests of the spouses or children of the Directors who themselves are not Directors of the Company) as
recorded in the Register of Directors’ Shareholdings are as follows:
At
1 April 2015
Interests in the Company :
Dr. Asairinachan @
- own
Number of ordinary shares of RM0.50 each
At
Bought
Sold 31 March 2016
45,000
-
224,503,750
23,430,000
6,600,000
- own
10,000
-
-
10,000
Loh Chye Teik
- own
45,000
250,000
-
295,000
Ooi Choi Kiat
- own
- others *
27,920,997
2,137,500
-
-
27,920,997
2,137,500
Lim Hock Siu
- own
165,750
30,000
-
195,750
- own
- others *
-
(6,600,000)
-
45,000
217,903,750
30,030,000
Number of warrants over ordinary shares of RM0.50 each
At
At
1 April 2015
Granted
Exercised 31 March 2016
Interests in the Company :
Dr. Asairinachan @
- own
20,000
-
-
20,000
94,180,766
4,000,000
-
-
94,180,766
4,000,000
20,000
-
-
20,000
Ooi Choi Kiat
- own
- others *
8,699,232
696,000
-
-
8,699,232
696,000
Lim Hock Siu
- own
46,600
-
-
46,600
- own
- others *
Loh Chye Teik
- own
* These are shares and warrants held in the name of spouse and/or children and are treated as interest of the
Directors in accordance with Section 134(12)(c) of the Companies Act, 1965.
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64
DIRECTORS' REPORT
Directors’ interests in shares (cont'd)
By virtue of his interest in the shares of the Company, Dato’ Low Eng Hock is also deemed interested in the shares
of the subsidiaries during the financial year to the extent that Ivory Properties Group Berhad has an interest.
None of the other Directors holding office at 31 March 2016 had any interest in the warrants over ordinary shares
of the Company and of its related corporations during the financial year.
Directors’ benefits
Since the end of the previous financial period, no Director of the Company has received nor become entitled
to receive any benefit (other than a benefit included in the aggregate amount of emoluments received or due
and receivable by Directors as shown in the financial statements or the fixed salary of a full time employee of
the Company or of related corporations) by reason of a contract made by the Company or a related corporation
with the Director or with a firm of which the Director is a member, or with a company in which the Director has a
substantial financial interest, other than as disclosed in Note 31 to the financial statements.
There were no arrangements during and at the end of the financial year which had the object of enabling Directors
of the Company to acquire benefits by means of the acquisition of shares in or debentures of the Company or any
other body corporate, other than the warrants of the Company as disclosed in Note 16 to the financial statements.
Issue of shares and debentures
There were no changes in the authorised, issued and paid-up capital of the Company and no debentures were in
issue by the Company during the financial year.
Warrants
As at the end of the financial year, the Company has the following outstanding warrants :
Warrants
Exercise price
per ordinary share
Expiry
date
Number of warrants outstanding
as at 31 March 2016
RM0.75
26 April 2017
186,000,000
Warrants 2012/2017
Each warrant entitles its registered holder to subscribe one (1) new ordinary share in the Company at an exercise
price of RM0.75 per share, subject to adjustments in accordance with the provisions of the deed poll, at any time
within 5 years from the date of issue of the warrant. The last date to exercise the warrant rights is 26 April 2017.
There were no new ordinary shares issued by virtue of the exercise of warrants during the financial year. As at the
end of the financial year, 186,000,000 warrants remained unexercised.
Options granted over unissued shares
No options were granted to any person to take up unissued shares of the Company during the financial year.
Other statutory information
Before the financial statements of the Group and of the Company were made out, the Directors took reasonable
steps to ascertain that:
i)
all known bad debts have been written off and adequate provision made for doubtful debts, and
ii)
any current assets which were unlikely to be realised in the ordinary course of business have been written
down to an amount which they might be expected so to realise.
annual report 2016
DIRECTORS' REPORT
Other statutory information (cont’d)
At the date of this report, the Directors are not aware of any circumstances:
i)
that would render the amount written off for bad debts or the amount of the provision for doubtful debts in
the Group and in the Company inadequate to any substantial extent, or
ii)
that would render the value attributed to the current assets in the financial statements of the Group and of
the Company misleading, or
iii)
which have arisen which render adherence to the existing method of valuation of assets or liabilities of the
Group and of the Company misleading or inappropriate, or
iv)
not otherwise dealt with in this report or the financial statements that would render any amount stated in the
financial statements of the Group and of the Company misleading.
At the date of this report, there does not exist:
i)
any charge on the assets of the Group or of the Company that has arisen since the end of the financial year
and which secures the liabilities of any other person, or
ii)
any contingent liability in respect of the Group or of the Company that has arisen since the end of the
financial year.
No contingent liability or other liability of any company in the Group has become enforceable, or is likely to
become enforceable within the period of twelve months after the end of the financial year which, in the opinion of
the Directors, will or may substantially affect the ability of the Group and of the Company to meet their obligations
as and when they fall due.
In the opinion of the Directors, the financial performance of the Group and of the Company for the financial year
ended 31 March 2016 have not been substantially affected by any item, transaction or event of a material and
unusual nature nor has any such item, transaction or event occurred in the interval between the end of that financial
year and the date of this report.
Significant events
The details of such events are disclosed in Note 32 to the financial statements.
Subsequent events
The details of such events are disclosed in Note 33 to the financial statements.
65
66
DIRECTORS' REPORT
Auditors
The auditors, Messrs KPMG, have indicated their willingness to accept re-appointment.
Signed on behalf of the Board of Directors in accordance with a resolution of the Directors :
Penang
Date : 28 July 2016
annual report 2016
CONSOLIDATED STATEMENTS
OF FINANCIAL POSITION
As At 31 March 2016
Note
31.3.2016
RM’000
31.3.2015
RM’000
(Restated)
1.1.2014
RM’000
(Restated)
Assets
Property, plant and equipment
Investment properties
Intangible assets
Investments in associates
Investments in joint ventures
Deferred tax assets
3
4
5
7
8
9
46,654
58,209
5
3,011
128,503
4,928
55,544
60,393
13
4,985
79,640
6,161
57,041
95,006
550
5,150
42,765
2,500
241,310
206,736
203,012
171,241
169,943
254,008
3,080
26,945
52,776
279,880
174,631
217,282
2,588
4,917
27,290
322,184
158,555
214,295
4
8,391
25,634
Total current assets
677,993
706,588
729,063
Total assets
919,303
913,324
932,075
204,164
209,178
204,164
198,635
204,164
175,122
413,342
402,799
379,286
Total non-current assets
Property development costs
Inventories
Trade and other receivables
Current tax assets
Short term investments
Cash and cash equivalents
10
11
12
13
14
Equity
Share capital
Reserves
Equity attributable to owners of the Company
Total equity
15
16
(248)
413,094
(1,605)
401,194
(267)
379,019
67
68
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As At 31 March 2016
Note
31.3.2016
RM’000
31.3.2015
RM’000
(Restated)
1.1.2014
RM’000
(Restated)
Liabilities
Loans and borrowings
Deferred tax liabilities
17
9
205,724
6,323
251,098
9,711
273,770
18,275
212,047
260,809
292,045
46,358
241,467
6,337
48,247
191,687
11,387
46,009
197,637
17,365
Total current liabilities
294,162
251,321
261,011
Total liabilities
506,209
512,130
553,056
Total equity and liabilities
919,303
913,324
932,075
Total non-current liabilities
Trade and other payables
Current tax payables
17
18
The notes on pages 76 to 143 are an integral part of these financial statements.
annual report 2016
STATEMENT OF FINANCIAL POSITION
As At 31 March 2016
Note
31.3.2016
RM’000
31.3.2015
RM’000
24,276
13,242
304,021
404
24,580
13,522
120,021
404
341,943
158,527
81,184
10,229
3,523
307,498
1,834
94,936
309,332
436,879
467,859
204,164
92,612
204,164
73,163
296,776
277,327
21,002
22,181
21,002
22,181
1,565
114,243
3,293
1,597
165,952
802
Total current liabilities
119,101
168,351
Total liabilities
140,103
190,532
Total equity and liabilities
436,879
467,859
Assets
Investments in subsidiaries
3
4
6
7
Total non-current assets
12
13
14
Total current assets
Total assets
Equity
Share capital
Reserves
15
16
Equity attributable to owners of the Company
Liabilities
17
Total non-current liabilities
Current tax payables
17
18
69
70
STATEMENTS OF PROFIT OR LOSS AND
OTHER COMPREHENSIVE INCOME
Note
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Continuing operations
423,007
(354,932)
270,185
(212,029)
35,771
(758)
15,475
(793)
Gross profit
68,075
58,156
35,013
14,682
Other income
13,608
(8,426)
(55,604)
(12)
48,813
(3,229)
(75,061)
(2,247)
2,673
(14,486)
(4)
37,466
(14,213)
(15)
17,641
26,432
23,196
37,920
1,432
(10,269)
1,486
(13,332)
701
(1,166)
(1,463)
(8,837)
(11,846)
(465)
(1,463)
(1,895)
10,841
(143)
8,951
-
-
8,946
8,808
-
36,457
Revenue
Cost of sales
19
20
Selling and marketing expenses
Administrative expenses
Other expenses
Results from operating activities
Finance income
Finance costs
21
Net finance costs
Share of (loss)/profit of equity-accounted
investees, net of tax
- associates
- joint venture
Profit before tax
22
17,750
23,394
22,731
Tax expense
24
(7,356)
(1,219)
(3,282)
10,394
22,175
19,449
35,995
10,543
(149)
23,513
(1,338)
19,449
-
35,995
-
10,394
22,175
19,449
35,995
2.37
5.28
Profit for the year/period representing
total comprehensive income for the
year/period
(462)
Profit for the year/period representing
total comprehensive income for the
year/period attributable to :
Owners of the Company
Total comprehensive income
for the year/period
Basic and diluted earnings
per ordinary share (sen)
25
32
204,164
Note 15
-
204,164
-
204,164
At 31 March 2016
Profit for the year representing total
comprehensive income for the year
Disposal of a subsidiary
At 31 March 2015/1 April 2015
Profit for the period representing total
comprehensive income for the period
At 1 January 2014
Group
Note
Share
capital
RM’000
27,900
Note 16
-
27,900
-
27,900
Warrant
reserve
RM’000
181,278
10,543
-
170,735
23,513
147,222
Retained
earnings
RM’000
Attributable to owners of the Company
Non-distributable
Distributable
413,342
10,543
-
402,799
23,513
379,286
Total
RM’000
(248)
(149)
1,506
(1,605)
(1,338)
(267)
Noncontrolling
interests
RM’000
413,094
10,394
1,506
401,194
22,175
379,019
Total
equity
RM’000
annual report 2016
71
CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
72
STATEMENT OF CHANGES IN EQUITY
Attributable to owners of the Company
Non-distributable
Distributable
Share
Warrant
Retained
capital
reserve
earnings
RM’000
RM’000
RM’000
Total
equity
RM’000
204,164
27,900
9,268
241,332
-
-
35,995
35,995
204,164
27,900
45,263
277,327
-
-
19,449
19,449
27,900
Note 16
64,712
296,776
Company
At 1 January 2014
Profit for the period representing total
comprehensive income for the period
Profit for the year representing total
comprehensive income for the year
At 31 March 2016
204,164
Note 15
73
annual report 2016
STATEMENTS OF CASH FLOWS
Note
Group
2016
RM’000
2015
RM’000
(Restated)
Company
2016
2015
RM’000
RM’000
Cash flows from
operating activities
Profit before tax from
continuing operations
Adjustments for:
Amortisation of intangible assets
Bad debts recovered
Depreciation of :
- property, plant and equipment
- investment properties
Finance income
Finance costs
(Gain)/Loss on disposal of :
- investment in joint venture
- investment in a subsidiary
Write off of :
- bad debts
Impairment loss on :
- trade receivables
- other receivables
- intangible assets
Write down of inventories
Share of loss in associates,
net of tax
Share of profit in joint ventures,
net of tax
Unrealised gain from downstream
sale to associates
Unrealised gain from downstream
sales to joint venture companies
Operating profit before
changes in working capital
17,750
23,394
22,731
36,457
10
-
-
-
5
22
8
(276)
3
4
22
21
6,605
2,184
(1,432)
10,269
8,409
2,841
(1,486)
13,332
22
22
22
22
(36)
(6,021)
(434)
(5,179)
(34,242)
-
925
280
(701)
1,166
1
-
877
350
1,463
15
(34,157)
-
22
22
22
14
149
-
126
201
286
3
149
-
20
-
22
22
3
5
22
373
2,213
-
1,656
361
3,646
527
664
-
-
1,895
143
-
-
-
-
(10,841)
(8,951)
79
22
-
-
4,720
1,061
-
-
27,653
6,387
24,554
5,025
74
Note
Change in property
development costs
Change in inventories
Change in trade and
other receivables
Change in trade and
other payables
Group
2016
RM’000
2015
RM’000
(Restated)
Company
2016
2015
RM’000
RM’000
108,639
4,592
42,304
(16,740)
-
(39,555)
11,150
42,165
(155,580)
62,635
(5,950)
(51,713)
136,206
Cash generated from
/(used in) operations
163,964
37,151
15,006
(14,349)
Tax paid
(15,053)
(22,006)
Net cash from/
(used in) operating activities
148,911
15,145
(791)
14,215
-
(1,334)
(15,683)
Cash flows from
investing activities
Acquisition of investment properties
Acquisition of property,
plant and equipment
Interest received
Increase in investments
in joint ventures
(Withdrawal)/Placement
of fixed deposits
Proceeds from disposal of :
- investment in joint venture
Cash outflow from disposal
of subsidiary
(Placement)/withdrawal of
short term investment, net
Net cash (used in)/from
investing activities
4
B
-
-
(3,021)
1,486
(42,742)
(48,598)
-
(992)
-
-
37,000
531
37,500
-
5
37,500
(354)
-
-
-
(22,028)
-
(10,229)
-
(62,955)
23,571
(9,719)
16,608
70
-
(191)
701
-
(1,449)
1,432
2,116
32
(335)
(1,199)
(19,698)
annual report 2016
Note
Group
2016
RM’000
2015
RM’000
(Restated)
Company
2016
2015
RM’000
RM’000
Cash flows from
financing activities
Interest paid
Repayment of finance
lease liabilities
Repayment of term loans
Drawdown of term loans
(10,269)
(13,332)
(1,166)
(1,463)
(3,529)
(92,986)
48,625
(2,886)
(127,844)
102,718
(382)
(1,259)
-
(296)
(808)
-
(58,159)
(41,344)
(2,807)
(2,567)
Net increase/(decrease)
in cash and cash equivalents
27,797
(2,628)
1,689
(1,642)
at beginning of year/period
23,006
25,634
1,834
3,476
50,803
23,006
3,523
1,834
Net cash used in
financing activities
at end of year/period
A
NOTES :
A.
Cash and cash equivalents included in the statements of cash flows comprise the following statements of
financial position amounts:
Note
Cash and bank balances
Bank overdrafts
B. Group
2016
RM’000
14
17
2015
RM’000
(Restated)
Company
2016
2015
RM’000
RM’000
52,131
(1,328)
24,529
(1,523)
3,523
-
1,834
-
50,803
23,006
3,523
1,834
Acquisition of property, plant and equipment
Group
2016
RM’000
Total acquisitions during
the year/period (Note 3)
Less : Acquisition by means
of finance leases
Total cash acquisitions
2,271
(822)
1,449
2015
RM’000
Company
2016
2015
RM’000
RM’000
10,781
621
(7,760)
(430)
3,021
191
1,579
(380)
1,199
75
76
NOTES TO THE FINANCIAL STATEMENTS
Ivory Properties Group Berhad is a public limited liability company, incorporated and domiciled in Malaysia and is
listed on the Main Market of Bursa Malaysia Securities Berhad. The addresses of the principal place of business
and registered office of the Company are as follows:
Principal place of business
81-11-1 Jalan Dato’ Keramat
10150 Georgetown
Penang
Registered office
42A Jalan Sultan Ahmad Shah
10050 Penang
The consolidated financial statements of the Company as at and for the financial year ended 31 March 2016
comprise the Company and its subsidiaries (together referred to as the “Group” and individually referred to as
“Group entities”) and the Group’s interests in associates and joint ventures.
The Company is principally engaged in investment holding and provision of management and marketing services
whilst the principal activities of the subsidiaries are as stated in Note 6 to the financial statements.
These financial statements were authorised for issue by the Board of Directors on 28 July 2016.
1.
Basis of preparation
(a)
Statement of compliance
The financial statements of the Group and the Company have been prepared in accordance with
Financial Reporting Standards (“FRS”) and the requirements of the Companies Act, 1965 in Malaysia.
The following are accounting standards, amendments and interpretations that have been issued by
the Malaysian Accounting Standards Board (MASB) but have not been adopted by the Group and
the Company :
FRSs, Interpretations and amendments effective for annual periods beginning on or after
1 January 2016
FRS 14, Regulatory Deferral Accounts
•
Amendments to FRS 5, Non-current Assets Held for Sale and Discontinued Operations
•
(Annual Improvements 2012-2014 Cycle)
Amendments to FRS 7, Financial Instruments: Disclosures (Annual Improvements 2012-2014
•
Cycle)
•
Amendments to FRS 10, Consolidated Financial Statements, FRS 12, Disclosure of Interests
in Other Entities and FRS 128, Investments in Associates and Joint Ventures – Investment
Entities: Applying the Consolidation Exception
Amendments to FRS 11, Joint Arrangements – Accounting for Acquisitions of Interests in Joint
•
Operations
Amendments to FRS 101, Presentation of Financial Statements – Disclosure Initiative
•
Amendments to FRS 116, Property, Plant and Equipment and FRS 138, Intangible Assets –
•
Clarification of Acceptable Methods of Depreciation and Amortisation
•
Amendments to FRS 119, Employee Benefits (Annual Improvements 2012-2014 Cycle)
•
Amendments to FRS 127, Separate Financial Statements – Equity Method in Separate Financial
Statements
Amendments to FRS 134, Interim Financial Reporting (Annual Improvements 2012-2014
•
Cycle)
annual report 2016
1.
Basis of preparation (cont'd)
(a)
Statement of compliance (cont'd)
1 January 2017
•
Amendments to FRS 107, Statement of Cash Flows – Disclosure Initiative
Amendments to FRS 112, Income Taxes – Recognition of Deferred Tax Assets for Unrealised
•
Losses
1 January 2018
FRS 9, Financial Instruments (2014)
•
FRSs, Interpretations and amendments effective for a date yet to be confirmed
Amendments to FRS 10, Consolidated Financial Statements and FRS 128, Investments in
•
Associates and Joint Ventures – Sale or Contribution of Assets between an Investor and its
Associate or Joint Venture
The Group and the Company plan to apply the abovementioned accounting standards, amendments
and interpretations in the respective financial years when the above mentioned standards,
amendments or interpretations become effective.
The Group and the Company’s financial statements for annual period beginning on 1 April 2018 will
be prepared in accordance with the Malaysian Financial Reporting Standards (MFRSs) issued by
the MASB and International Financial Reporting Standards (IFRSs).
The Group is currently assessing the financial impact that may arise from the adoption of the above
accounting standards, amendments and interpretations.
The Group and the Company fall within the scope of IC Interpretation 15, Agreements for the Construction
of Real Estate. Therefore, the Group and the Company are currently exempted from adopting the
Malaysian Financial Reporting Standards (“MFRS”) and is referred to as a “Transitioning Entity”.
(b)
Basis of measurement
The financial statements have been prepared on the historical cost basis, other than as disclosed in
Note 2 to the financial statements.
(c)
Functional and presentation currency
These financial statements are presented in Ringgit Malaysia (“RM”), which is the Company’s
functional currency. All financial information is presented in RM and has been rounded to the nearest
thousand, unless otherwise stated.
(d) Use of estimates and judgements
The preparation of the financial statements in conformity with FRSs requires management to make
judgements, estimates and assumptions that affect the application of accounting policies and the reported
amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimates are revised and in any future periods
affected.
77
78
1.
Basis of preparation (cont'd)
(d) Use of estimates and judgements (cont'd)
There are no significant areas of estimation uncertainty and critical judgements in applying accounting
policies that have significant effect on the amounts recognised in the financial statements other than
the following:
(i)
Property development and construction
he Group recognises property development and construction contract revenue and
T
expenses in profit or loss using the stage of completion method. The stage of completion is
measured by reference to either the costs incurred to date to the estimated total costs or the
completion of a physical proportion of work-to-date.
Significant judgement is required in determining the stage of completion, the extent of the
costs incurred, the estimated total property development and construction revenue and
costs, as well as the recoverability of the development and construction projects. In making
the judgement, the Group evaluates based on past experience and by relying on the work
of specialists.
(ii) Inventories
he Directors are of the opinion that no further write down is required for the unsold units of
T
the Group’s completed development properties as they are confident of realising those units
at a price which is higher than the carrying amount.
2.
(iii)
Recognition and measurement of the low medium cost housing (“LMC”) quota recognised
as disclosed in Note 11 to the financial statements.
(iv)
Valuation of investment properties as disclosed in Note 4 to the financial statements.
(v)
Deferred tax assets as disclosed in Note 9 to the financial statements.
Significant accounting policies
The accounting policies set out below have been applied consistently to the periods presented in these
financial statements and have been applied consistently by Group entities, unless otherwise stated.
(a)
Basis of consolidation
(i)Subsidiaries
Subsidiaries are entities, including structured entities, controlled by the Company. The
financial statements of subsidiaries are included in the consolidated financial statements
from the date that control commences until the date that control ceases.
The Group controls an entity when it is exposed, or has rights, to variable returns from its
involvement with the entity and has the ability to affect those returns through its power over
the entity. Potential voting rights are considered when assessing control only when such
rights are substantive. The Group also considers it has de facto power over an investee
when, despite not having the majority of voting rights, it has the current ability to direct the
activities of the investee that significantly affect the investee’s return.
Investments in subsidiaries are measured in the Company’s statement of financial position
at cost less any impairment losses, unless the investment is classified as held for sale or
distribution. The cost of investments includes transaction costs.
annual report 2016
2.
Significant accounting policies (cont'd)
(a)
Basis of consolidation (cont'd)
(ii)
Business combinations
Business combinations are accounted for using the acquisition method from the acquisition
date, which is the date on which control is transferred to the Group.
For new acquisitions, the Group measures the cost of goodwill at the acquisition date as:
•
the fair value of the consideration transferred; plus
•
the recognised amount of any non-controlling interests in the acquiree; plus
•
if the business combination is achieved in stages, the fair value of the existing equity
interest in the acquiree; less
the net recognised amount (generally fair value) of the identifiable assets acquired
•
and liabilities assumed.
When the excess is negative, a bargain purchase gain is recognised immediately in profit or
loss.
For each business combination, the Group elects whether it measures the non-controlling
interests in the acquiree either at fair value or at the proportionate share of the acquiree’s
identifiable net assets at the acquisition date.
Transaction costs, other than those associated with the issue of debt or equity securities,
that the Group incurs in connection with a business combination are expensed as incurred.
(iii)
Acquisitions of non-controlling interests
The Group accounts for all changes in its ownership interest in a subsidiary that do not result
in a loss of control as equity transactions between the Group and its non-controlling interest
holders. Any difference between the Group’s share of net assets before and after the change,
and any consideration received or paid, is adjusted to or against Group reserves.
(iv)
Loss of control
Upon the loss of control of a subsidiary, the Group derecognises the assets and liabilities
of the former subsidiary, any non-controlling interests and the other components of equity
related to the former subsidiary from the consolidated statement of financial position. Any
surplus or deficit arising on the loss of control is recognised in profit or loss. If the Group
retains any interest in the former subsidiary, then such interest is measured at fair value at the
date that control is lost. Subsequently it is accounted for as an equity accounted investee or
as an available-for-sale financial asset depending on the level or influence retained.
(v)Associates
Associates are entities, including unincorporated entities, in which the Group has significant
influence, but not control, over the financial and operating policies.
Investments in associates are accounted for in the consolidated financial statements using
the equity method less any impairment losses, unless it is classified as held for sale or
distribution. The cost of the investment includes transaction costs. The consolidated financial
statements include the Group’s share of the profit or loss and other comprehensive income
of the associates, after adjustments if any, to align the accounting policies with those of
the Group, from the date that significant influence commences until the date that significant
influence ceases.
79
80
2.
(a)
(v)
Associates (cont'd)
When the Group’s share of losses exceeds its interest in an associate, the carrying amount
of that interest including any long-term investments is reduced to zero, and the recognition
of further losses is discontinued except to the extent that the Group has an obligation or has
made payments on behalf of the associate.
When the Group ceases to have significant influence over an associate, any retained interest
in the former associate at the date when significant influence is lost is measured at fair value
and this amount is regarded as the initial carrying amount of a financial asset. The difference
between the fair value of any retained interest plus proceeds from the interest disposed of
and the carrying amount of the investment at the date when equity method is discontinued is
recognised in the profit or loss.
When the Group’s interest in an associate decreases but does not result in a loss of significant
influence, any retained interest is not remeasured. Any gain or loss arising from the decrease
in interest is recognised in profit or loss. Any gains or losses previously recognised in other
comprehensive income are also reclassified proportionately to profit or loss if that gain or loss
would be required to be reclassified to profit or loss on the disposal of the related assets or
liabilities.
Investments in associates are measured in the Company’s statement of financial position
at cost less any impairment losses, unless the investment is classified as held for sale or
distribution. The cost of the investment includes transaction costs.
(vi)
Joint arrangements
Joint arrangements are arrangements of which the Group has joint control, established by
contracts requiring unanimous consent for decisions about the activities that significantly
affect the arrangements’ returns.
Joint arrangements are classified and accounted for as follows:
(vii)
•
A joint arrangement is classified as “joint operation” when the Group or the Company
has rights to the assets and obligations for the liabilities relating to an arrangement.
The Group account for each of its share of the assets, liabilities and transactions,
including its share of those held or incurred jointly with the other investors, in relation
to the joint operation.
•
A joint arrangement is classified as “joint venture” when the Group has rights only
to the net assets of the arrangements. The Group accounts for its interest in the
joint venture using the equity method. Investment in joint venture is measured in the
Group’s statement of financial position at cost less any impairment losses, unless the
investment is classified as held for sale or distribution. The cost of investment includes
transaction costs.
Non-controlling interests at the end of the reporting period, being the equity in a subsidiary
not attributable directly or indirectly to the equity holders of the Company, are presented in
the consolidated statement of financial position and statement of changes in equity within
equity, separately from equity attributable to the owners of the Company. Non-controlling
interests in the results of the Group is presented in the consolidated statement of profit or loss
and other comprehensive income as an allocation of the profit or loss and the comprehensive
income for the year between non-controlling interests and owners of the Company.
annual report 2016
2.
(a)
(vii)
Non-controlling interests (cont'd)
Losses applicable to the non-controlling interests in a subsidiary are allocated to the noncontrolling interests even if doing so causes the non-controlling interests to have a deficit
balance.
(viii) Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses arising from
intra-group transactions, are eliminated in preparing the consolidated financial statements.
Unrealised gains arising from transactions with equity-accounted associates and joint
ventures are eliminated against the investment to the extent of the Group’s interest in the
investees. Unrealised losses are eliminated in the same way as unrealised gains, but only to
the extent that there is no evidence of impairment.
(b)
Financial instruments
(i)
Initial recognition and measurement
A financial asset or a financial liability is recognised in the statement of financial position when,
and only when, the Group or the Company becomes a party to the contractual provisions of
the instrument.
A financial instrument is recognised initially, at its fair value plus, in the case of a financial
instrument not at fair value through profit or loss, transaction costs that are directly attributable
to the acquisition or issue of the financial instrument.
An embedded derivative is recognised separately from the host contract and accounted for
as a derivative if, and only if, it is not closely related to the economic characteristics and
risks of the host contract and the host contract is not categorised at fair value through profit
or loss. The host contract, in the event an embedded derivative is recognised separately, is
accounted for in accordance with policy applicable to the nature of the host contract.
(ii)
Financial instrument categories and subsequent measurement
The Group and the Company categorise financial instruments as follows:
Financial assets
(a)
Financial assets at fair value through profit or loss
Fair value through profit or loss category comprises financial assets that are held
for trading, including derivatives (except for a derivative that is a financial guarantee
contract), contingent consideration in a business combination or financial assets that
are specifically designated into this category upon initial recognition.
Derivatives that are linked to and must be settled by delivery of unquoted equity
instruments whose fair values cannot be reliably measured are measured at cost.
Other financial assets categorised as fair value through profit or loss are subsequently
measured at their fair values with the gain or loss recognised in profit or loss.
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2.
(b)
Financial instruments (cont'd)
(ii)
Financial instrument categories and subsequent measurement (cont'd)
Financial assets (cont'd)
(b)
Loans and receivables
Loans and receivables category comprises debt instruments that are not quoted in
an active market.
Financial assets categorised as loans and receivables are subsequently measured at
amortised cost using the effective interest method.
(c)
Available-for-sale financial assets
Available-for-sale category comprises investment in equity and debt securities
instruments that are not held for trading.
Investments in equity instruments that do not have a quoted market price in an active
market and whose fair value cannot be reliably measured are measured at cost. Other
financial assets categorised as available-for-sale are subsequently measured at their
fair values with the gain or loss recognised in other comprehensive income, except for
impairment losses, foreign exchange gains and losses arising from monetary items
and gains and losses of hedged items attributable to hedge risks of fair value hedges
which are recognised in profit or loss. On derecognition, the cumulative gain or loss
recognised in other comprehensive income is reclassified from equity into profit or
loss. Interest calculated for a debt instrument using the effective interest method is
recognised in profit or loss.
All financial assets, except for those measured at fair value through profit or loss, are subject
to review for impairment (see Note 2(k)(i)).
Financial liabilities
All financial liabilities are subsequently measured at amortised cost other than those
categorised as fair value through profit or loss.
Fair value through profit or loss category comprises financial liabilities that are derivatives
(except for a derivative that is a financial guarantee contract), contingent consideration in a
business combination or financial liabilities that are specifically designated into this category
upon initial recognition.
Derivatives that are linked to and must be settled by delivery of equity instruments that do not
have a quoted price in an active market for identical instruments whose fair values otherwise
cannot be reliably measured are measured at cost.
Other financial liabilities categorised as fair value through profit or loss are subsequently
measured at their fair values with the gain or loss recognised in profit or loss.
(iii)
Financial guarantee contracts
A financial guarantee contract is a contract that requires the issuer to make specified
payments to reimburse the holder for a loss it incurs because a specified debtor fails to make
payment when due in accordance with the original or modified terms of a debt instrument.
annual report 2016
2.
(b)
(iii)
Financial guarantee contracts (cont'd)
Fair value arising from financial guarantee contracts are classified as deferred income and
is amortised to profit or loss using a straight-line method over the contractual period or,
when there is no specified contractual period, recognised in profit or loss upon discharge
of the guarantee. When settlement of a financial guarantee contract becomes probable, an
estimate of the obligation is made. If the carrying value of the financial guarantee contract
is lower than the obligation, the carrying value is adjusted to the obligation amount and
accounted for as a provision.
(iv)
Regular way purchase or sale of financial assets
A regular way purchase or sale is a purchase or sale of a financial asset under a contract
whose terms require delivery of the asset within the time frame established generally by
regulation or convention in the marketplace concerned.
A regular way purchase or sale of financial assets is recognised and derecognised, as
applicable, using trade date accounting. Trade date accounting refers to:
(a)
(b)
the recognition of an asset to be received and the liability to pay for it on the trade
date, and
derecognition of an asset that is sold, recognition of any gain or loss on disposal and
the recognition of a receivable from the buyer for payment on the trade date.
(v)Derecognition
A financial asset or part of it is derecognised when, and only when the contractual rights
to the cash flows from the financial asset expire or control of the asset is not retained or
substantially all of the risk and rewards of ownership of the financial asset are transferred
to another party. On derecognition of a financial asset, the difference between the carrying
amount and the sum of the consideration received (including any new asset obtained less
any new liability assumed) and any cumulative gain or loss that had been recognised in
equity is recognised in the profit or loss.
A financial liability or a part of it is derecognised when, and only when, the obligation specified
in the contract is discharged, cancelled or expires. On derecognition of a financial liability, the
difference between the carrying amount of the financial liability extinguished or transferred
to another party and the consideration paid, including any non-cash assets transferred or
liabilities assumed, is recognised in profit or loss.
(c)
(i)
Recognition and measurement
Items of property, plant and equipment are measured at cost less any accumulated
depreciation and any accumulated impairment losses.
Cost includes expenditures that are directly attributable to the acquisition of the asset and
any other costs directly attributable to bringing the asset to working condition for its intended
use, and the costs of dismantling and removing the items and restoring the site on which
they are located. The cost of self-constructed assets also includes the cost of materials and
direct labour. For qualifying assets, borrowing costs are capitalised in accordance with the
accounting policy on borrowing costs. Cost also may include transfers from equity of any
gain or loss on qualifying cash flow hedges of foreign currency purchases of property, plant
and equipment.
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2.
(c)
Property, plant and equipment (cont'd)
(i)
Recognition and measurement (cont'd)
Purchased software that is integral to the functionality of the related equipment is capitalised
as part of that equipment.
The cost of property, plant and equipment recognised as a result of a business combination
is based on fair value at acquisition date. The fair value of property is the estimated amount
for which a property could be exchanged between knowledgeable willing parties in an arm’s
length transaction after proper marketing wherein the parties had each acted knowledgeably,
prudently and without compulsion. The fair value of other items of plant and equipment is
based on the quoted market prices for similar items when available and replacement cost
when appropriate.
When significant parts of an item of property, plant and equipment have different useful
lives, they are accounted for as separate items (major components) of property, plant and
equipment.
The gain or loss on disposal of an item of property, plant and equipment is determined
by comparing the proceeds from disposal with the carrying amount of property, plant and
equipment and is recognised net within “other income” and “other expenses” respectively
in profit or loss.
(ii)
Subsequent costs
The cost of replacing a component of an item of property, plant and equipment is recognised
in the carrying amount of the item if it is probable that the future economic benefits embodied
within the component will flow to the Group or the Company, and its cost can be measured
reliably. The carrying amount of the replaced component is derecognised to profit or loss.
The costs of the day-to-day servicing of property, plant and equipment are recognised in
profit or loss as incurred.
(iii)Depreciation
Depreciation is based on the cost of an asset less its residual value. Significant components
of individual assets are assessed, and if a component has a useful life that is different from
the remainder of that asset, then that component is depreciated separately.
Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful
lives of each component of an item of property, plant and equipment from the date that they
are available for use. Leased assets are depreciated over the shorter of the lease term and
their useful lives unless it is reasonably certain that the Group will obtain ownership by the
end of the lease term. Freehold land is not depreciated. Capital work-in-progress are not
depreciated until the assets are ready for their intended use.
The depreciation rate for the current and comparative periods based on their estimated
useful lives are as follows :
Buildings
Office equipment, furniture and fittings
Site equipment and machinery
Motor vehicles
Renovation
%
2
10 - 20
10 - 20
20
10
Depreciation methods, useful lives and residual values are reviewed at the end of the reporting
period and adjusted as appropriate.
annual report 2016
2.
(d)
Leased assets
(i)
Finance leases
Leases in terms of which the Group or the Company assumes substantially all the risks and
rewards of ownership are classified as finance leases. Upon initial recognition, the leased
asset is measured at an amount equal to the lower of its fair value and the present value of
the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in
accordance with the accounting policy applicable to that asset.
Minimum lease payments made under finance leases are apportioned between the finance
expense and the reduction of the outstanding liability. The finance expense is allocated to
each period during the lease term so as to produce a constant periodic rate of interest on the
remaining balance of the liability. Contingent lease payments are accounted for by revising
the minimum lease payments over the remaining term of the lease when the lease adjustment
is confirmed.
Leasehold land which in substance is a finance lease is classified as property, plant and
equipment, or as investment property if held to earn rental income or for capital appreciation
or for both.
(ii)
Operating leases
Leases, where the Group or the Company does not assume substantially all the risks and
rewards of ownership are classified as operating leases and the leased assets are not
recognised on the statement of financial position.
Payments made under operating leases are recognised in profit or loss on a straight-line
basis over the term of the lease. Lease incentives received are recognised in profit or loss as
an integral part of the total lease expense, over the term of the lease. Contingent rentals are
charged to profit or loss in the reporting period in which they are incurred.
Leasehold land which in substance is an operating lease is classified as prepaid lease
payments.
(e)
Intangible assets
(i)Goodwill
Goodwill arises on business combinations is measured at cost less any accumulated
impairment losses. In respect of equity-accounted associates and joint ventures, the carrying
amount of goodwill is included in the carrying amount of the investment and an impairment
loss on such an investment is not allocated to any asset, including goodwill, that forms part
of the carrying amount of the equity-accounted associates and joint ventures.
(ii)
Other intangible assets
Intangible assets, other than goodwill, that are acquired by the Group, which have finite
useful lives, are measured at cost less any accumulated amortisation and any accumulated
impairment losses.
(iii)
Subsequent expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits
embodied in the specific asset to which it relates. All other expenditure, including expenditure
on internally generated goodwill and brands, is recognised in profit or loss as incurred.
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2.
(e)
Intangible assets (cont'd)
(iv)Amortisation
Goodwill and intangible assets with indefinite useful lives are not amortised but are tested for
impairment annually and whenever there is an indication that they may be impaired.
Other intangible assets are amortised from the date that they are available for use. Amortisation
is based on the cost of an asset less its residual value. Amortisation is recognised in profit or
loss on a straight-line basis over the estimated useful lives of intangible assets.
The estimated useful lives for the current and comparative periods for franchise fees range
between 3 to 8 years.
Amortisation methods, useful lives and residual values are reviewed at the end of each
reporting period and adjusted, if appropriate.
(f)
Investment property
(i)
Investment property carried at cost
Investment properties are properties which are owned or held under a leasehold interest
to earn rental income or for capital appreciation or for both, but not for sale in the ordinary
course of business, use in the production or supply of goods or services or for administrative
purposes.
Investment properties are stated at cost less any accumulated depreciation and any
accumulated impairment losses, consistent with the accounting policy for property, plant and
equipment as stated in accounting policy Note 2(c).
Cost includes expenditure that is attributable to the acquisition of the investment property.
The cost of self-constructed investment property includes of materials and direct labour, any
other costs directly attributable to bringing the investment property to a working condition for
their intended use and capitalised borrowing costs.
Depreciation is charged to profit or loss on a straight-line basis over the estimated useful lives
of 50 years.
An investment property is derecognised on its disposal, or when it is permanently withdrawn
from use and no future economic benefits are expected from its disposal. The difference
between the net disposal proceeds and the carrying amount is recognised in profit or loss in
the period in which the item is derecognised.
(ii)
Reclassification to/from investment property
Transfers between investment properties, property, plant and equipment and inventories do
not change the carrying amount and cost of the property transferred.
(iii)
Determination of fair value
The Directors estimate the fair values of the Group’s investment property by taking into
account of some of the valuations done by external, independent property valuers.
The fair values are based on market values, being the estimated amount for which a property
could be exchanged on the date of the valuation between a willing buyer and a willing seller
in an arm’s length transaction after proper marketing wherein the parties had each acted
knowledgeably, prudently and without compulsion.
annual report 2016
2.
(g)Inventories
Inventories are measured at the lower of cost and net realisable value. Cost is determined on the
specific identification basis and includes costs of land, direct building costs and other related
development cost.
Net realisable value is the estimated selling price in the ordinary course of business, less the
estimated costs of completion and the estimated costs necessary to make the sale.
LMC quota represents the remaining tradable quota available to the Group arising from their
completed low medium cost project and is measured initially at fair value which represents the cost
of the LMC quota inventory. The fair value used to determine the LMC quota is based on Directors’
estimation using the latest available market information and recent experience and knowledge of
the LMC quota market.
(h)
Property development costs
Property development costs comprise costs associated with the acquisition of land and all costs that
are directly attributable to development activities or that can be allocated on a reasonable basis to
such activities, including interest expense incurred during the period of active development.
Property development costs not recognised as an expense is recognised as an asset and is stated
at the lower of cost and net realisable value.
The excess of revenue recognised in profit or loss over billings to purchasers is shown as accrued
billings under receivables and the excess of billings to purchasers over revenue recognised in profit
or loss is shown as progress billings under payables.
(i)
Construction work-in-progress
Construction work-in-progress represents the gross unbilled amount expected to be collected from
customers for contract work performed to date. It is measured at cost plus profit recognised to
date less progress billings and recognised losses. Cost includes all expenditure related directly to
specific projects and an allocation of fixed and variable overheads incurred in the Group’s contract
activities based on normal operating capacity.
Construction work-in-progress is presented as part of trade and other receivables as amount due
from contract customers in the statement of financial position for all contracts in which costs incurred
plus recognised profits exceed progress billings. If progress billings exceed costs incurred plus
recognised profits, then the difference is presented as amount due to contract customers which is
part of the deferred income in the statement of financial position.
(j)
Cash and cash equivalents consist of cash on hand, balances and deposits with banks including
the amount maintained pursuant to the Housing Developers (Housing Development Account)
(Amendment) Regulations 2002, and highly liquid investments which have an insignificant risk of
changes in fair value with original maturities of three months or less, and are used by the Group
and the Company in the management of their short term commitments. For the purpose of the
statements of cash flows, cash and cash equivalents are presented net of bank overdrafts and
pledged deposits.
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2.
(k)Impairment
(i)
Financial assets
All financial assets (except for financial assets categorised as fair value through profit or loss,
investments in subsidiaries and investments in associates and joint ventures) are assessed
at each reporting date whether there is any objective evidence of impairment as a result
of one or more events having an impact on the estimated future cash flows of the asset.
Losses expected as a result of future events, no matter how likely, are not recognised. For an
investment in an equity instrument, a significant or prolonged decline in the fair value below
its cost is an objective evidence of impairment. If any such objective evidence exists, then the
impairment loss of the financial asset is estimated.
An impairment loss in respect of loans and receivables is recognised in profit or loss and
is measured as the difference between the asset’s carrying amount and the present value
of estimated future cash flows discounted at the asset’s original effective interest rate. The
carrying amount of the asset is reduced through the use of an allowance account.
An impairment loss in respect of available-for-sale financial assets is recognised in profit
or loss and is measured as the difference between the asset’s acquisition cost (net of any
principal repayment and amortisation) and the asset’s current fair value, less any impairment
loss previously recognised. Where a decline in the fair value of an available-for-sale financial
asset has been recognised in the other comprehensive income, the cumulative loss in other
comprehensive income is reclassified from equity to profit or loss.
An impairment loss in respect of unquoted equity instrument that is carried at cost is
recognised in profit or loss and is measured as the difference between the financial asset’s
carrying amount and the present value of estimated future cash flows discounted at the
current market rate of return for a similar financial asset.
Impairment losses recognised in profit or loss for an investment in an equity instrument
classified as available for sale is not reversed through profit or loss.
If, in a subsequent period, the fair value of a debt instrument increases and the increase
can be objectively related to an event occurring after the impairment loss was recognised in
profit or loss, the impairment loss is reversed, to the extent that the asset’s carrying amount
does not exceed what the carrying amount would have been had the impairment not been
recognised at the date the impairment is reversed. The amount of the reversal is recognised
in profit or loss.
(ii)
Other assets
The carrying amounts of other assets (except for inventories, amount due from contract
customers and deferred tax asset) are reviewed at the end of each reporting period to
determine whether there is any indication of impairment. If any such indication exists, then
the asset’s recoverable amount is estimated. For goodwill and intangible assets that have
indefinite useful lives or that are not yet available for use, the recoverable amount is estimated
each period at the same time.
For the purpose of impairment testing, assets are grouped together into the smallest group
of assets that generates cash inflows from continuing use that are largely independent of
the cash inflows of other assets or cash-generating units. Subject to an operating segment
ceiling test, for the purpose of goodwill impairment testing, cash-generating units to which
goodwill has been allocated are aggregated so that the level at which impairment testing
is performed reflects the lowest level at which goodwill is monitored for internal reporting
purposes. The goodwill acquired in a business combination, for the purpose of impairment
testing, is allocated to cash-generating unit or a group of cash-generating units that are
expected to benefit from the synergies of the combination.
annual report 2016
2.
(k)
Impairment (cont'd)
(ii)
Other assets (cont'd)
The recoverable amount of an asset or cash-generating unit is the greater of its value in use
and its fair value less costs of disposal. In assessing value in use, the estimated future cash
flows are discounted to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset or cashgenerating unit.
An impairment loss is recognised if the carrying amount of an asset or its related cashgenerating unit exceeds its estimated recoverable amount.
Impairment losses are recognised in profit or loss. Impairment losses recognised in respect
of cash-generating units are allocated first to reduce the carrying amount of any goodwill
allocated to the cash-generating unit (group of cash-generating units) and then to reduce the
carrying amounts of the other assets in the cash-generating unit (groups of cash-generating
units) on a pro rata basis.
An impairment loss in respect of goodwill is not reversed. In respect of other assets,
impairment losses recognised in prior periods are assessed at the end of each reporting
period for any indications that the loss has decreased or no longer exists. An impairment loss
is reversed if there has been a change in the estimates used to determine the recoverable
amount since the last impairment loss was recognised. An impairment loss is reversed only
to the extent that the asset’s carrying amount does not exceed the carrying amount that
would have been determined, net of depreciation or amortisation, if no impairment loss had
been recognised. Reversals of impairment losses are credited to profit or loss in the financial
year in which the reversals are recognised.
(l)
Equity instruments
Instruments classified as equity are measured at cost on initial recognition and are not remeasured
subsequently.
(i)
Issue expenses
Costs directly attributable to the issue of instruments classified as equity are recognised as a
deduction from equity.
(ii)
Ordinary shares
Ordinary shares are classified as equity.
(iii)
Distribution of assets to owners of the Company
The Group measures a liability to distribute assets as a dividend to the owners of the
Company at the fair value of the assets to be distributed. The carrying amount of the dividend
is remeasured at each reporting period and at the settlement date, with any changes
recognised directly in equity as adjustments to the amount of the distribution. On settlement
of the transaction, the Group recognises the difference, if any, between the carrying amount
of the assets distributed and the carrying amount of the liability in profit or loss.
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2.
(m)
Employee benefits
(i)
Short-term employee benefits
Short-term employee benefit obligations in respect of salaries, annual bonuses, paid annual
leave and sick leave are measured on an undiscounted basis and are expensed as the
related service is provided.
A liability is recognised for the amount expected to be paid under short-term cash bonus
or profit-sharing plans if the Group has a present legal or constructive obligation to pay
this amount as a result of past service provided by the employee and the obligation can be
estimated reliably.
(ii)
State plans
The Group’s contributions to statutory pension funds are charged to profit or loss in the
financial year to which they relate. Prepaid contributions are recognised as an asset to the
extent that a cash refund or a reduction in future payments is available.
(n)Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive
obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will
be required to settle the obligation. Provisions are determined by discounting the expected future
cash flows at a pre-tax rate that reflects current market assessments of the time value of money and
the risks specific to the liability. The unwinding of the discount is recognised as finance cost.
(o)Contingencies
(i)
Contingent liabilities
Where it is not probable that an outflow of economic benefits will be required, or the
amount cannot be estimated reliably, the obligation is not recognised in the statements of
financial position and is disclosed as a contingent liability, unless the probability of outflow
of economic benefits is remote. Possible obligations, whose existence will only be confirmed
by the occurrence or non-occurrence of one or more future events, are also disclosed as
contingent liabilities unless the probability of outflow of economic benefits is remote.
(ii)
Contingent assets
When an inflow of economic benefit of an asset is probable where it arises from past events
and where existence will be confirmed only by the occurrence or non-occurrence of one
or more uncertain future events not wholly within the control of the entity, the asset is not
recognised in the statements of financial position but is being disclosed as a contingent asset.
When the inflow of economic benefit is virtually certain, then the related asset is recognised.
(p)
Revenue and other income
(i)
Revenue from property development activities is recognised based on the stage of completion
measured by reference to the proportion that property development costs incurred for work
performed to date bear to the estimated total property development costs.
Where the financial outcome of a property development activity cannot be reliably estimated,
property development revenue is recognised only to the extent of property development
costs incurred that is probable will be recoverable, and property development costs on the
development units sold are recognised as an expense in the year in which they are incurred.
annual report 2016
2.
(p)
Revenue and other income (cont'd)
(i)
Property development (cont'd)
Any expected loss on a development project, including costs to be incurred over the defects
liability period, is recognised immediately in profit or loss.
(ii)
Construction contracts
Contract revenue includes the initial amount agreed in the contract plus any variations in
contract work, claims and incentive payments, to the extent that it is probable that they will
result in revenue and can be measured reliably. As soon as the outcome of a construction
contract can be estimated reliably, contract revenue and contract cost are recognised in
profit or loss in proportion to the stage of completion of the contract. Contract expenses are
recognised as incurred unless they create an asset related to future contract activity.
The stage of completion is assessed by reference to the proportion that contract costs
incurred for work performed to-date bear to the estimated total contract costs.
When the outcome of a construction contract cannot be estimated reliably, contract revenue
is recognised only to the extent of contract costs incurred that are likely to be recoverable. An
expected loss on a contract is recognised immediately in profit or loss.
(iii)
Completed development properties
Revenue relating to sale of completed development properties is recognised net of discounts
when transfer of risks and rewards has been completed.
(iv)Services
Revenue from services rendered is recognised in profit or loss in proportion to the stage of
completion of the transaction at the end of the reporting period. The stage of completion is
assessed by reference to surveys of work performed.
Revenue from the sale of food and beverages are recognised when the services are rendered.
(v)
Interest income
Interest income is recognised as it accrues using the effective interest method in profit or loss
except for interest income arising from temporary investment of borrowings taken specifically
for the purpose of obtaining a qualifying asset which is accounted for in accordance with the
accounting policy on borrowing costs.
(vi)
Dividend income
Dividend income is recognised in profit or loss on the date that the Group’s or the Company’s
right to receive payment is established, which in the case of quoted securities is the
ex-dividend date.
(vii)
Management fees
Revenue arising from the provision of services is recognised on the dates the services are
rendered and completed.
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2.
(p)
Revenue and other income (cont'd)
(viii) Project management
Project management includes commission income. When the Group acts in the capacity
of an agent rather than as the principal in a transaction, the revenue recognised is the net
amount of commission made by the Group.
(ix)
Rental income
Rental income from investment property is recognised in profit or loss on a straight-line basis
over the term of the lease. Lease incentives granted are recognised as an integral part of the
total rental income, over the term of the lease. Rental income from sub-leased property is
recognised as other income.
(x)
LMC quota
Revenue from sales of LMC quota in the course of ordinary activities is measured at fair
value of the consideration received or receivable. Revenue is recognised when persuasive
evidence exists, usually in the form of an executed sale agreement that the significant risks and
rewards of ownership have been transferred to the customer, recovery of the consideration is
probable, the associated cost can be estimated reliably, the Group has fulfilled its obligation
in the sale agreement, and the amount of revenue can be measured reliably.
(q)
Borrowing costs
Borrowing costs that are not directly attributable to the acquisition, construction or production of a
qualifying asset are recognised in profit or loss using the effective interest method.
Borrowing costs directly attributable to the acquisition, construction or production of qualifying
assets, which are assets that necessarily take a substantial period of time to get ready for their
intended use or sale, are capitalised as part of the cost of those assets.
The capitalisation of borrowing costs as part of the cost of a qualifying asset commences when
expenditure for the asset is being incurred, borrowing costs are being incurred and activities that
are necessary to prepare the asset for its intended use or sale are in progress. Capitalisation of
borrowing costs is suspended or ceases when substantially all the activities necessary to prepare
the qualifying asset for its intended use or sale are interrupted or completed.
Investment income earned on the temporary investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.
(r)
Income tax
Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognised
in profit or loss except to the extent that it relates to a business combination or items recognised
directly in equity or other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using
tax rates enacted or substantively enacted by the end of the reporting period, and any adjustment to
tax payable in respect of previous financial years.
annual report 2016
2.
(r)
Income tax (cont'd)
Deferred tax is recognised using the liability method, providing for temporary differences between
the carrying amounts of assets and liabilities in the statement of financial position and their tax
bases. Deferred tax is not recognised for the following temporary differences: the initial recognition
of goodwill, and the initial recognition of assets or liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable profit or loss. Deferred tax is measured
at the tax rates that are expected to be applied to the temporary differences when they reverse,
based on the laws that have been enacted or substantively enacted by the end of the reporting
period.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax
liabilities and assets, and they relate to income taxes levied by the same tax authority on the same
taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on
a net basis or their tax assets and liabilities will be realised simultaneously.
A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be
available against which the temporary difference can be utilised. Deferred tax assets are reviewed
at the end of each reporting period and are reduced to the extent that it is no longer probable that
the related tax benefit will be realised.
(s)
Earnings per ordinary share
The Group presents basic and diluted earnings per share data for its ordinary shares (“EPS”).
Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the
Company by the weighted average number of ordinary shares outstanding during the period,
adjusted for own shares held.
Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and
the weighted average number of ordinary shares outstanding adjusted for own shares held for the
effects of all dilutive potential ordinary shares, which comprise warrants issued by the Company.
(t)
Operating segments
An operating segment is a component of the Group that engages in business activities from which it
may earn revenues and incur expenses, including revenues and expenses that relate to transactions
with any of the Group’s other components. Operating segment’s results are reviewed regularly by
the chief operating decision maker, which in this case is the Chief Executive Officer of the Group, to
make decisions about resources to be allocated to the segment and to assess its performance, and
for which discrete financial information is available.
(u)
Warrant reserve
Fair values from the issuance of warrants are credited to warrant reserve which is non-distributable.
When the warrants are exercised or expired, the warrant reserve will be transferred to another reserve
account within equity.
(v)
Fair value measurement
Fair value of an asset or a liability, except for share-based payment and lease transactions, is
determined as the price that would be received to sell an asset or paid to transfer a liability in
an orderly transaction between market participants at the measurement date. The measurement
assumes that the transaction to sell the asset or transfer the liability takes place either in the principal
market or in the absence of a principal market, in the most advantageous market.
93
94
2.
(v)
Fair value measurement (cont'd)
For non-financial asset, the fair value measurement takes into account a market participant’s ability
to generate economic benefits by using the asset in its highest and best use or by selling it to
another market participant that would use the asset in its highest and best use.
When measuring the fair value of an asset or a liability, the Group uses observable market data as
far as possible. Fair value are categorised into different levels in a fair value hierarchy based on the
input used in the valuation technique as follows:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities that the
Group can access at the measurement date.
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset
or liability, either directly or indirectly.
Level 3: unobservable inputs for the asset or liability.
The Group recognises transfers between levels of the fair value hierarchy as of the date of the event
or change in circumstances that caused the transfers.
annual report 2016
3.
Office
equipment,
furniture
Buildings and fittings
RM’000
RM’000
Site
equipment
and
machinery
RM’000
Motor
vehicles Renovation
RM’000
RM’000
Total
RM’000
Group
Cost
At 1 January 2014
Additions
Disposals
Write-off
At 31 March 2015/
1 April 2015
Additions
Disposals
Write-off
Disposal of a
subsidiary
At 31 March 2016
23,033
596
-
23,629
-
10,257
734
(61)
(81)
10,849
498
(78)
(39)
33,299
8,554
(713)
(50)
41,090
4,328
778
(600)
-
10,635
119
(33)
(72)
81,552
10,781
(1,407)
(203)
4,506
10,649
90,723
652
(10)
551
-
570
-
2,271
(78)
(49)
(8,568)
-
(856)
(9,424)
-
-
23,629
11,230
33,164
5,057
10,363
83,443
19
4,661
14,103
2,990
2,738
24,511
588
-
1,185
(25)
(39)
-
1,345
(5)
(21)
1,602
8,409
(1,310)
(77)
3,646
607
5,782
17,878
3,209
4,057
31,533
-
-
2,044
-
1,602
3,646
607
5,782
19,922
3,209
5,659
35,179
Depreciation and
impairment loss
At 1 January 2014
Accumulated
depreciation
Depreciation for the
period
Disposals
Write-off
Impairment loss
4,472
(680)
(17)
2,044
819
(600)
-
At 31 March 2015/
1 April 2015
Accumulated
depreciation
Accumulated
impairment loss
95
96
3.
Office
equipment,
furniture
Buildings and fittings
RM’000
RM’000
Site
equipment
and
machinery
RM’000
Motor
vehicles Renovation
RM’000
RM’000
Total
RM’000
Group
Depreciation and
impairment loss
year
Disposals
Write-off
Disposal of a
subsidiarydepreciation
Disposal of a
subsidiaryimpairment loss
472
-
906
(44)
(30)
3,910
(5)
512
-
805
-
6,605
(44)
(35)
-
-
(2,424)
-
(242)
(2,666)
-
-
(2,044)
-
(206)
(2,250)
1,079
6,614
19,359
3,721
4,620
35,393
-
-
-
-
1,396
1,396
1,079
6,614
19,359
3,721
6,016
36,789
At 1 January 2014
23,014
5,596
19,196
1,338
7,897
57,041
At 31 March 2015/
1 April 2015
23,022
5,067
21,168
1,297
4,990
55,544
At 31 March 2016
22,550
4,616
13,805
1,336
4,347
46,654
At 31 March 2016
Accumulated
depreciation
Accumulated
impairment loss
Carrying amounts
97
annual report 2016
3.
Buildings
RM’000
Office
equipment
RM’000
Motor
vehicles Renovation
RM’000
RM’000
22,715
197
768
50
521
(25)
4
439
339
23
-
1,546
73
499
-
-
Total
RM’000
Company
Cost
At 1 January 2014
Additions
Disposal
Transfer from a subsidiary
Additions
Disposal
Write-off
At 31 March 2016
596
23,311
-
697
122
(2)
(5)
9
23,730
1,579
(25)
343
25,627
621
(2)
(5)
9
23,311
821
2,045
73
26,250
-
17
101
3
121
877
(5)
54
Depreciation
At 1 January 2014
Depreciation for the period
Disposal
580
-
48
(5)
1
240
53
9
-
580
61
394
12
Depreciation for the year
Disposal
Write-off
466
-
81
(1)
(2)
5
370
-
8
-
At 31 March 2016
1,047
925
(1)
(2)
5
1,046
144
764
20
1,974
At 1 January 2014
22,715
180
667
47
23,609
22,731
636
1,152
61
24,580
At 31 March 2016
22,265
677
1,281
53
24,276
Carrying amounts
98
3.
3.1
Leased equipment and motor vehicles
At 31 March 2016, the net carrying amounts of leased equipment and motor vehicles of the Group and
of the Company were RM9,351,669 (2015: RM11,100,604) and RM1,260,658 (2015 : RM1,151,618)
respectively.
3.2Security
Property, plant and equipment of the Group and the Company amounting to RM22,265,285
(2015 : RM22,731,512) and RM22,265,285 (2015 : RM22,731,512) respectively have been pledged
to licensed banks as security for banking facilities granted to the Group.
3.3
Motor vehicles held in trust
Included in property, plant and equipment of the Group are motor vehicles held in trust by certain
Directors of the Company amounting to RM Nil (2015 : RM95,958).
4.
Freehold
buildings
RM’000
Freehold
residential
lots
RM’000
Freehold
commercial
retail lots
RM’000
Freehold
land
RM’000
Total
RM’000
12,069
396
60,656
29,405
102,526
(266)
-
330
(2,636)
(569)
5
(29,410)
-
335
(32,312)
(569)
12,069
130
57,781
-
69,980
At 1 January 2014
113
79
7,328
-
7,520
period
Disposals
Write-off
341
-
10
(58)
-
2,490
(433)
(283)
-
2,841
(491)
(283)
At 31 March 2015/
1 April 2015
454
31
9,102
-
9,587
273
3
1,908
-
2,184
At 31 March 2016
727
34
11,010
-
11,771
Group
Cost
At 1 January 2014
Additions
Disposals
Write-off
At 31 March 2015/
1 April 2015/
31 March 2016
-
Depreciation
99
annual report 2016
4.
Investment properties (cont'd)
Freehold
buildings
RM’000
Freehold
residential
lots
RM’000
Freehold
commercial
retail lots
RM’000
Freehold
land
RM’000
Total
RM’000
At 1 January 2014
11,956
317
53,328
29,405
95,006
At 31 March 2015/
1 April 2015
11,615
99
48,679
-
60,393
At 31 March 2016
11,342
96
46,771
-
58,209
Group
Carrying amounts
Freehold
buildings
RM’000
Company
Cost
At 1 January 2014/31 March 2015/1 April 2015/31 March 2016
14,000
Depreciation
At 1 January 2014
128
Depreciation for the period
350
478
280
At 31 March 2016
758
Carrying amounts
At 1 January 2014
13,872
13,522
At 31 March 2016
13,242
Investment properties comprise a number of commercial properties that are leased to third parties. No
contingent rents are charged.
Certain properties of the Group and the Company amounting to RM57,080,305 (2015 : RM59,119,727) and
RM13,241,667 (2015 : RM13,521,667) respectively were charged as securities for borrowings granted to
certain subsidiaries (see Note 17).
100
4.
The following are recognised in profit or loss in respect of investment properties :
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Rental income
Direct operating expenses:
- income generating investment
properties
- non-income generating investment
properties
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
2,426
2,123
480
512
5,351
6,447
829
974
401
364
-
-
Fair value information
The fair value of the investment properties of the Group and the Company as at 31 March 2016 is classified
as Level 3 of fair value hierarchy and is estimated at approximately RM98,243,000 (2015 : RM97,125,000)
and RM14,000,000 (2015 : RM14,000,000) respectively.
The following table shows the valuation techniques used in the determination of fair value within Level 3, as
well as the significant unobservable inputs used in the valuation models.
Description of valuation
technique and inputs used
Significant
unobservable inputs
Inter-relationship
between significant
unobservable inputs and
fair value measurement
Discounted cash flows: The valuation
method considers the present value of
net cash flows to be generated from the
property, taking into account expected
rental growth rate, void periods, occupancy
rate, lease incentive costs such as rent-free
periods and other costs not paid by tenants.
The expected net cash flows are discounted
using risk-adjusted discount rates. Among
other factors, the discount rate estimation
considers the quality of a building and its
location (prime vs. secondary), tenant credit
quality and lease terms.
Void periods (average 1
month after the end of
each lease).
Rent-free periods (1 month
period on new leases).
Risk-adjusted discount rates
(3.5% - 5%, weighted
average 4.25%).
The estimated fair value
would increase (decrease)
if : expected void periods
were shorter (longer);
rent-free periods were
shorter (longer); or riskadjusted discount rates
were higher (lower).
Sales comparison approach: Sales price of
comparable properties in close proximity
are adjusted for differences in key attributes
such as property size. The most significant
input into this valuation approach is price
per square foot.
Price per square foot
(RM700 - RM1,500)
The estimated fair value
would increase (decrease)
if the price per square foot
is higher (lower).
Valuation processes applied by the Group for Level 3 fair value
The fair value of investment properties is based on the estimates of market value by Directors, taking
into account some of the valuation in 2015 and 2016 by external, independent property valuers, having
appropriate recognised professional qualifications and recent experience in the location and category of
property. Investment properties of the Group for a carrying amount of RM14,567,000 (2015: RM15,452,000)
and with the fair value of RM19,248,000 (2015: RM18,315,000) are determined solely based on Directors’
estimates using either discounted cash flows or recent transaction prices around the vicinity.
101
annual report 2016
4.
Valuation processes applied by the Group for Level 3 fair value (cont'd)
Highest and best use
Investment properties comprise a number of commercial properties. The Directors had determined the
current use of these investment properties as their highest and best use.
5.
Intangible assets - Group
Goodwill on
consolidation
RM’000
Franchise
fees
RM’000
Total
RM’000
527
43
570
-
20
20
Amortisation for the period (Note 22)
Impairment loss (Note 22)
527
10
-
10
527
527
30
557
-
8
8
527
38
565
527
23
550
-
13
13
At 31 March 2016
-
5
5
Cost
At 1 January 2014/ 31 March 2015/1 April 2015/
31 March 2016
Amortisation and impairment loss
At 1 January 2014
Amortisation for the year (Note 22)
At 31 March 2016
Carrying amounts
At 1 January 2014
5.1
Impairment testing for cash-generating units containing goodwill
For the purpose of impairment testing, goodwill was allocated to the Group’s Cash-Generating Units
(“CGUs”) identified.
Goodwill was tested for impairment on an annual basis by comparing the carrying amount with the
recoverable amount of the CGUs based on the value-in-use.
Value-in-use was determined by discounting the future cash flows generated from the continuing
use of the unit and is based on the recent financial projections approved by the Management.
The gross margin used in the projections was based on past experience.
102
6.
Investments in subsidiaries
Company
2016
2015
RM’000
RM’000
Unquoted shares, at cost
304,021
120,021
Details of the subsidiaries are as follows :
Effective
ownership interest
and voting interest
2016
2015
%
%
Name of entity
Country of
incorporation Principal activities
Ivory Associates Sdn Bhd (“IASB”)
Malaysia
100
100
Ivory Gleneary Sdn Bhd (“IGSB”)
Malaysia
100
100
Ivory Square Sdn Bhd (“ISSB”)*
Malaysia
100
100
Ivory Meadows Sdn Bhd (“IM”)*
Malaysia
100
100
Ivory Property Management
Services Sdn Bhd (“IPMS”)*
Malaysia
Property management services
100
100
G & A Consultancy Sdn
Bhd (“G&A”)*
Malaysia
Engineering and architectural
consultancy services
100
100
Ivory Indah Sdn Bhd (“IISB”)*
Malaysia
100
100
Ivory Furniture & Interior Sdn Bhd
(“IFSB”)*
Malaysia
Interior designer and contractor
in interior decoration and
furnishing
100
100
Ivory Times Square Sdn
Bhd (“ITS”)*
Malaysia
Tenancy management services,
sub-letting of properties and
providing utilities services
100
100
Ivory Utilities Sdn Bhd (“IUSB”)
Malaysia
Investment holding
100
100
Sunlink Properties Sdn
Bhd (“Sunlink”)*
Malaysia
Operations of entertainment,
100
100
Ivory Media Sdn Bhd (“IMD”)*
Malaysia
Advertising services and
sub-letting of properties
100
100
Ivory Residence Sdn Bhd
(“IRSB”)*
Malaysia
Dormant
100
100
Ivory View Sdn Bhd (“IWSB”)
Malaysia
100
100
Ivory Villas Sdn Bhd (“IVSB”)
Malaysia
100
100
TTG Holdings Sdn Bhd (“TTGH”)*
Malaysia
Investment holding
100
100
103
annual report 2016
6.
Investments in subsidiaries (cont'd)
Effective
ownership interest
and voting interest
2016
2015
%
%
Name of entity
Country of
Ivory Place Sdn Bhd (“IPSB”)
Malaysia
Dormant
70
70
G Ivory Sdn Bhd (“G Ivory”) *
Malaysia
Dormant
100
-
Ivory World City Sdn Bhd (“IWC”) * Malaysia
Dormant
100
-
Soju Entertainment Sdn Bhd
(“Soju”)*
Malaysia
Operations of entertainment,
-
80
Malaysia
100
100
Subsidiary of IASB
Tanjong Tokong Garden
Development Sendirian Berhad
(“TTGD”)*
* Not audited by KPMG
Non-controlling interests in subsidiaries
The Group’s subsidiaries that have non-controlling interests (“NCI”) are as follows :
Soju**
RM’000
2016
IPSB
RM’000
NCI percentage of ownership interest and voting interest
-
30%
Carrying amount of NCI
-
(248)
(248)
36
(149)
Loss allocated to NCI
(185)
Total
RM’000
** Summarised financial information for Soju is not presented as the Group had disposed of its entire 80%
equity interest during the financial year.
2016
IPSB
RM’000
Summarised financial information before intra-group elimination
As at 31 March
Non-current assets
Current assets
Non-current liabilities
Current liabilities
5
1
(131)
(703)
Net liabilities
(828)
104
6.
Investments in subsidiaries (cont'd)
2016
IPSB
RM’000
Summarised financial information before intra-group elimination (cont'd)
Year ended 31 March
Revenue
Loss for the year representing total comprehensive expense for the year
(7)
Cash flows from operating activities
Cash flows from financing activities
53
(54)
Net decrease in cash and cash equivalents
NCI percentage of ownership interest and voting interest
Carrying amount of NCI
Loss allocated to NCI
(1)
Soju
RM’000
2015
IPSB
RM’000
20%
30%
(1,321)
(1,073)
(284)
(265)
Total
RM’000
(1,605)
(1,338)
2015
Soju
RM’000
IPSB
RM’000
Summarised financial information before intra-group elimination
As at 31 March
Non-current assets
Current assets
Current liabilities
4,499
714
(11,817)
5
3
(188)
(641)
(6,604)
(821)
Revenue
Loss for the period representing total comprehensive expense for the period
5,247
(5,363)
(765)
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
(1,379)
(164)
1,664
118
(57)
(59)
Net liabilities
Period ended 31 March
Net increase in cash and cash equivalents
121
2
105
annual report 2016
7.
Group
2016
RM’000
Share of post-acquisition reserves
414
2,597
3,011
2015
RM’000
Company
2016
2015
RM’000
RM’000
414
4,571
4,985
404
404
404
404
Details of the associates are as follows :
Name of entity
Effective
ownership interest
and voting interest
2016
2015
%
%
Country of
Ivory Continental Sdn Bhd (“ICSB”) Malaysia
49
49
Park Vue Realty Sdn Bhd
Malaysia
Investment holding
45
45
Associate of IGSB
George Town Bids Sdn Bhd
Malaysia
Provision of management
and regeneration activities
for George Town business
improvement district
20
20
The following table summarises the information of the Group’s associate, adjusted for any differences in
accounting policies and reconciles the information to the carrying amount of the Group’s interest in the
associates.
Ivory
Continental
Sdn Bhd
RM’000
2016
Other
individually
immaterial
associates
RM’000
Total
RM’000
Group
Summarised financial information
As at 31 March
Non-current assets
Current assets
Current liabilities
Net assets
6,431
14,976
(12,851)
431
(16)
6,431
15,407
(12,867)
8,556
415
8,971
106
7.
Investments in associates (cont'd)
Ivory
Continental
Sdn Bhd
RM’000
2016
Other
individually
immaterial
associates
RM’000
Total
RM’000
Group
Summarised financial information (cont'd)
Year ended 31 March
Loss from continuing operations representing total
comprehensive expense
(3,864)
(4)
(3,868)
Included in the total comprehensive expense is:
Revenue
-
-
-
Reconciliation of net assets/(liabilities) to carrying
amount as at 31 March
Group’s share of net assets/(liabilities)
Elimination of unrealised gain
4,192
(79)
(1,102)
-
3,090
(79)
Carrying amount in the statement of financial position
4,113
(1,102)
3,011
Group’s share of results for the year ended 31 March
Group’s share of loss from continuing operations
representing Group’s share of total comprehensive
expense
(1,893)
Ivory
Continental
Sdn Bhd
RM’000
(2)
2015
Other
individually
immaterial
associates
RM’000
(1,895)
Total
RM’000
Group
As at 31 March
Non-current assets
Current assets
Current liabilities
Net assets
8,382
17,428
(13,390)
444
(14)
8,382
17,872
(13,404)
12,420
430
12,850
107
annual report 2016
7.
Investments in associates (cont'd)
Ivory
Continental
Sdn Bhd
RM’000
2015
Other
individually
immaterial
associates
RM’000
Total
RM’000
Group
Summarised financial information (cont'd)
Period ended 31 March
Loss from continuing operations representing total
comprehensive expense
(281)
(32)
(313)
38
15
53
Included in the total comprehensive expense is:
Revenue
Reconciliation of net assets/(liabilities) to carrying
amount as at 31 March
Group’s share of net assets/(liabilities)
6,085
(22)
(1,078)
-
5,007
(22)
6,063
(1,078)
4,985
Group’s share of results for the period ended 31 March
Group’s share of loss from continuing operations
representing Group’s share of total comprehensive
expense
8.
(138)
(5)
(143)
Investment in joint venture
Group
2016
RM’000
Share of post-acquisition reserves
2015
RM’000
119,317
9,186
76,573
3,067
128,503
79,640
Tropicana Ivory Sdn Bhd (“TISB”), the only joint arrangement in which the Group participates, is principally
engaged in property development.
TISB is structured as separate vehicles and provide the Group rights to the net assets of the entity.
Accordingly, the Group has classified the investment in TISB as joint venture.
108
8.
Investment in joint venture (cont'd)
The following tables summarise the financial information of TISB. The table also reconciles the summarised
financial information to the carrying amount of the Group’s interest in TISB, which is accounted for using
the equity method.
Group
2016
RM’000
Percentage of ownership interest
45%
2015
RM’000
45%
The Group treated TISB as a joint venture as the shareholder agreements require unaminous consent over
decisions.
As at 31 March
Non-current assets
Current assets
Current liabilities
Net assets
6,737
805,343
(443,102)
(70,549)
8,015
545,622
(315,160)
(59,126)
298,429
179,351
24,090
20,074
211,656
179,415
Year/Period ended 31 March
Profit from continuing operations representing total comprehensive income
Included in the total comprehensive income is:
Revenue
Reconciliation of net assets to carrying amount as at 31 March
Group’s share of net assets
134,293
(5,790)
80,701
(1,061)
128,503
79,640
10,841
8,951
277,200
157,500
Group’s share of results for the year/period ended 31 March
Group’s share of profit from continuing operations representing Group’s
share of total comprehensive income
Contingent liabilities
Share of joint ventures’ contingent liabilities incurred jointly with other
investors:
- Guaranteed bank facilities
annual report 2016
109
9.
Deferred tax assets/(liabilities) - Group
Recognised deferred tax assets/(liabilities)
Deferred tax assets and liabilities are attributable to the following :
Assets
2016
2015
RM’000
RM’000
Liabilities
2016
2015
RM’000
RM’000
Net
2016
RM’000
2015
RM’000
Property, plant and
equipment
Tax loss carry- forwards
(251)
5,179
(160)
6,321
(6,323)
-
(9,711)
-
(6,574)
5,179
(9,871)
6,321
Net tax assets/(liabilities)
4,928
6,161
(6,323)
(9,711)
(1,395)
(3,550)
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax
assets against current tax liabilities and when the deferred taxes relate to the same taxable entity.
Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available
against which the Group can utilise the benefits therefrom.
Movement in temporary differences during the financial year/period
At
1 January
2014
RM’000
Property, plant and
equipment
Tax loss carry- forwards
Recognised
in profit
or loss
(Note 24)
RM’000
At
31 March
2015/1 April
2015
RM’000
Recognised
in profit
or loss
(Note 24)
RM’000
At
31 March
2016
RM’000
(18,275)
2,500
8,404
3,821
(9,871)
6,321
3,297
(1,142)
(6,574)
5,179
(15,775)
12,225
(3,550)
2,155
(1,395)
Unrecognised deferred tax assets
Deferred tax assets have not been recognised in respect of the following items (stated at gross):
Tax loss carry-forwards
Capital allowances carry-forwards
2016
RM’000
2015
RM’000
19,220
5,647
12,525
3,596
24,867
16,121
The comparative figures have been restated to reflect the revised tax loss carry-forwards and capital
allowances carry-forwards available to the Group.
The tax loss carry-forwards and capital allowances carry-forwards do not expire under current tax legislation.
Deferred tax assets have not been recognised in respect of these items because it is not probable that
future taxable profits will be available against which the Group can utilise the benefits therefrom.
110
10.
Property development costs - Group
2016
RM’000
2015
RM’000
159,508
288,713
(168,341)
169,633
278,535
(125,984)
279,880
322,184
102,877
(194,309)
(17,207)
112,017
(150,225)
(4,096)
171,241
279,880
135,685
294,072
(258,516)
159,508
288,713
(168,341)
171,241
279,880
At beginning of year/period
Freehold land
Development costs
Accumulated costs charged to profit or loss
Add : Development costs incurred during the year/period
Less : Cost charged to profit or loss (Note 20)
Less : Transfer to inventories
At end of year/period
This represents :
Freehold land
Development costs
Accumulated costs charged to profit or loss
(i)
Included in property development costs incurred during the year/period of the Group are the
following :
Staff costs
Interest expense (Note 21)
(ii)
11.
1.4.2015
to
31.3.2016
RM’000
1.1.2014
to
31.3.2015
RM’000
1,505
10,797
1,970
13,625
Property development costs amounting to RM175,717,477 (2015 : RM234,089,119) have been
charged to a licensed bank as securities for banking facilities granted to the Group.
Inventories - Group
Note
Quota on low medium cost housing (“LMC quota”)
Others
11.1
2016
RM’000
2015
RM’000
169,868
75
152,989
21,490
152
169,943
174,631
111
annual report 2016
11.
Inventories - Group (cont'd)
11.1 Low medium cost housing quota (“LMC quota”)
The LMC quota represents the remaining tradable quota available to the Group granted by the local
council arising from the Group’s development of low and medium cost housing project. The LMC
quota was initially measured at fair value. The fair value used to determine the LMC quota was based
on Directors’ estimation using the latest available market information and recent experience and
knowledge of the LMC quota market. The fair value of LMC quota as at 31 March 2015 was classified
as Level 3 of fair value hierarchy.
11.2Security
Certain completed development properties of the Group amounting to RM119,849,045 (2015 :
RM124,458,778) are charged to licensed banks as securities for banking facilities (see Note 17).
12.
Note
Group
2016
RM’000
12.1
-
-
2,673
6,706
12.1
6,416
8,165
-
-
12.1
12.2
70,454
57,466
17,358
36,182
18,078
192
12.3
2
72,150
8,953
79,551
-
-
206,488
150,209
20,751
6,898
12.1
-
-
36,063
264,352
12.1
1,793
-
1,793
-
12.1
12.4
12.5
12.6
2
14,840
30,885
-
25,232
25,842
15,999
105
22,472
-
17,122
19,126
-
47,520
67,073
60,433
300,600
254,008
217,282
81,184
307,498
2015
RM’000
Company
2016
2015
RM’000
RM’000
Trade
Amount due from
subsidiaries
Amount due from an
associate
Amount due from a joint
venture
Trade receivables
Amount due from contract
customers
Accrued billings
Non-trade
Amount due from
subsidiaries
Amount due from an
associate
Amount due from a joint
venture
Other receivables
Deposits and prepayments
Share application money
112
12.
Trade and other receivables (cont'd)
12.1 Amounts due from subsidiaries, an associate and a joint venture
The trade amounts due from subsidiaries, associate and joint venture are subject to normal trade
terms.
The non-trade amounts due from subsidiaries, associate and joint venture are unsecured, interest
free and repayable on demand.
Included in amount due from a joint venture is a retention sum of RM17,814,000 (2015 : RM2,481,000)
relating to construction work-in-progress. Retention sum is unsecured and interest-free.
12.2 Trade receivables
Included in trade receivables is an amount of RM118,200 (2015: RM14,200) due from a Company in
which a Director of the Group has substantial financial interest.
12.3 Construction work-in-progress
Note
Aggregate costs incurred to date
Add: Attributable profits
Less : Progress billings
Amount due from contract customers
12.3.1 12.3.1
Group
2016
RM’000
2015
RM’000
441,715
26,331
197,690
8,004
468,046
205,694
(468,044)
(196,741)
2
8,953
Included in construction costs incurred during the year of the Group are the following :
Staff costs
Hire of machinery, tools and equipment
Interest expense
1.4.2015
to
31.3.2016
RM’000
1.1.2014
to
31.3.2015
RM’000
7,171
2,293
435
7,828
2,099
-
12.4 Other receivables
(i)
Included in other receivables of the Group and the Company was an amount of
RM16,806,000 and RM16,806,000 respectively as at 31 March 2015 in respect of
remaining balance receivable for the divestment of 49% stake in a joint venture, Aspen
Vision Land Sdn. Bhd.
(ii)
Included in other receivables of the Group is an amount of RM361,000 (2015: RM75,600)
due from a Company in which a Director of the Group has substantial financial interest.
113
annual report 2016
12.
Trade and other receivables (cont'd)
12.5 Deposits and prepayments
(i)
Included in deposits and prepayments of the Group and the Company is an amount of
RM11,930,000 (2015: RM17,600,000) and RM11,930,000 (2015: RM17,600,000) respectively
being payment made for the purchase of LMC quota.
(ii)
Included in deposits and prepayments of the Group and the Company is an amount of
RM8,566,000 (2015: RMNil) and RM8,566,000 (2015: RMNil) being refundable deposits to
secure the marketing right for a proposed commercial development.
(iii)
Included in deposits and prepayments of the Group is an amount of RM500,000 (2015 :
RM500,000) being deposit paid to land owners for development of a joint venture project.
12.6 Share application money
Share application money represents the amount paid for the proposed subscription of shares in
a joint venture. In the event that the application for allotment of shares is not accepted, the share
application money will be refunded to the Group.
13.
31.3.2016
RM’000
31.3.2015
RM’000
(Restated)
1.1.2014
RM’000
(Restated)
Group
Fixed deposits with licensed banks
Unit trust money market funds
8,677
18,268
4,917
-
8,391
-
26,945
4,917
8,391
31.3.2016
RM’000
31.3.2015
RM’000
10,229
-
Company
Unit trust money market funds
13.1 Fixed deposits with licensed banks
Included in fixed deposits with licensed banks are as follows :
(i)
an amount of RM8,676,969 (2015: RM4,916,638; 2014: RM2,932,945) pledged for bank
facilities granted to the subsidiaries (see Note 17).
(ii)
an amount of RM100,783 (2015: RM100,783) held in trust by a Director of the Company.
114
14.
31.3.2016
RM’000
31.3.2015
RM’000
(Restated)
1.1.2014
RM’000
(Restated)
Group
Fixed deposits with licensed banks
645
52,131
2,761
24,529
25,634
52,776
27,290
25,634
31.3.2016
RM’000
31.3.2015
RM’000
3,523
1,834
Company
Included in cash and bank balances of the Group is an amount of RM3,253,589 (2015 : RM4,016,171) held
under Housing Development Account as required under the Housing Developers (Housing Development
Account) (Amendment) Regulations 2002.
15.
Share capital
Number of
shares
2016
’000
Amount
2016
RM’000
Number of
shares
2015
’000
Amount
2015
RM’000
1,000,000
500,000
1,000,000
500,000
445,527
222,764
445,527
222,764
Group and Company
Authorised:
Ordinary shares of RM0.50 each
Issued and fully paid:
Less: Allocation of proceeds to
warrant reserve (Note 16.1)
445,527
(18,600)
204,164
445,527
(18,600)
204,164
Ordinary shares
The holders of ordinary shares are entitled to receive dividends as declared from time to time, and are
entitled to one vote per share at meetings of the Company.
annual report 2016
115
16.Reserves
Note
Group
2016
RM’000
2015
RM’000
Company
2016
2015
RM’000
RM’000
181,278
170,735
64,712
45,263
27,900
27,900
27,900
27,900
209,178
198,635
92,612
73,163
Distributable
Retained earnings
Non-distributable
Warrant reserve
16.1
16.1 Warrant Reserve
Group and Company
2016
2015
RM’000
RM’000
Allocation of proceeds from Rights Issue (Note15)
Transferred from share premium
18,600
9,300
18,600
9,300
27,900
27,900
During the financial year 2012, the Company issued 186,000,000 new detachable warrants
(“Warrant(s)”) on the basis of one (1) share to be issued to the Rights Issue and one (1) warrant
for every one (1) existing ordinary share of RM0.50 each held in the Company. The theoretical fair
value of the warrants was computed using the Black-Scholes Option Pricing Model at approximately
RM0.2777 per warrant.
Each warrant entitles its registered holder to subscribe for one (1) new ordinary share in the Company
at an exercise price of RM0.75 per share subject to adjustments in accordance with the provisions
of the deed poll, at any time within 5 years from the date of issue of the warrant. The last date to
exercise the warrant rights is 26 April 2017.
As at 31 March 2016, 186,000,000 warrants remained unexercised.
17.
Group
2016
RM’000
2015
RM’000
Company
2016
2015
RM’000
RM’000
201,670
4,054
245,037
6,061
20,609
393
21,932
249
205,724
251,098
21,002
22,181
Non-current
Secured :
Term loans
Finance lease liabilities
116
17.
Loans and borrowings (cont'd)
Group
2016
RM’000
2015
RM’000
Company
2016
2015
RM’000
RM’000
Current
Secured :
Term loans
Bank overdrafts
Revolving credit
21,748
2,623
1,328
10,659
27,901
3,323
1,523
5,500
1,324
241
-
1,260
337
-
Unsecured :
Revolving credit
10,000
10,000
-
-
46,358
48,247
1,565
1,597
17.1Securities
Term loans and bank overdrafts
The Group’s and the Company’s borrowings are secured by way of :
(i)
first party legal charge or assignment over the Group’s and the Company’s certain freehold
land, freehold building, development land, investment properties and inventories (see Notes
3, 4, 10 and 11);
(ii)
a debenture incorporating fixed and floating charge over certain subsidiaries’ present and
future assets;
(iii)
fixed deposits of certain subsidiaries (see Note 13 and 14);
(iv)
corporate guarantees by the Company and its subsidiaries;
(v)
joint and several guarantees by certain Directors of the Company;
(vi)
third party legal charge over development land and inventories of certain subsidiaries; and
(vii) housing development account, sinking fund account and project account of certain
subsidiaries.
Revolving credit
The Group’s revolving credit facilities are secured by way of :
(i)
third party first legal charge;
(ii)
assignment of all sales/rental proceeds;
(iii)
assignment of contract proceeds;
(iv)
fixed deposit;
(v)
memorandum of charge over the Joint Account;
(vi)
corporate guarantee by the company; and
(vii)
irrevocable & unconditional Standby Letter of Credit from Bank of East Asia.
117
annual report 2016
17.
Loans and borrowings (cont'd)
17.2 Finance lease liabilities
Finance lease liabilities are payable as follows :
Future
minimum
lease
payments
2016
RM’000
Interest
2016
RM’000
Present
value of
minimum
lease
payments
2016
RM’000
Future
minimum
lease
payments
2015
RM’000
Interest
2015
RM’000
Present
value of
minimum
lease
payments
2015
RM’000
Group
Less than one year
Between one and
five years
2,950
(327)
2,623
3,791
(468)
3,323
4,311
(257)
4,054
6,594
(533)
6,061
7,261
(584)
6,677
10,385
(1,001)
9,384
265
(24)
241
357
(20)
337
419
(26)
393
259
(10)
249
684
(50)
634
616
(30)
586
Company
Less than one year
Between one and
five years
18.
Note
Group
2016
RM’000
2015
RM’000
Company
2016
2015
RM’000
RM’000
Trade
Amount due to a joint
venture
Trade payables
Progress billings
Advance payment from
contract customer
18.1
28
101,123
213
76,248
10,986
28
136
-
365
-
33,978
53,271
-
-
135,342
140,505
164
365
118
18.
Trade and other payables (cont'd)
Note
Group
2016
RM’000
2015
RM’000
Company
2016
2015
RM’000
RM’000
Non-trade
Amount due to subsidiaries
Amount due to an associate
Amount due to a joint
venture
Amount due to Directors
Other payables
Refundable advances from
customers
Accruals
18.1
18.1
221
221
91,851
-
160,713
221
18.1
18.1
18.2
27
19,734
17,189
2,743
23,954
19,734
1,423
2,285
948
18.3
59,152
9,802
24,264
1,071
1,420
106,125
51,182
114,079
165,587
241,467
191,687
114,243
165,952
18.1 Amounts due to subsidiaries, an associate, a joint venture and Directors
The trade amount due to a joint venture is subject to normal trade terms.
The non-trade amounts due to subsidiaries, associate, joint venture and Directors are unsecured,
interest-free and payable on demand.
18.2 Other payables
Included in other payables of the Group is an amount of RM7,500,000 (2015 : RM7,500,000) being
the first deposit received for the disposal of the freehold land.
18.3 Refundable advances from customers
Refundable advances from customers are money paid by a facilitator for securing the rights to
market and sell the properties of the Group. These advances will be refunded to the facilitator once
the properties are successfully sold and money received by the Group.
19.Revenue
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Project management
Management fee
Dividend income
LMC quota
Others
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
231,106
32,800
6,061
122,388
27,437
3,215
198,096
7,319
9,656
43,599
11,515
19,426
5,818
9,624
903
2,813
11,160
1,502
423,007
270,185
35,771
15,475
119
annual report 2016
20.
Cost of sales
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Property development (Note 10)
Project management
Post-completion project costs
LMC quota
Others
21.
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
194,309
9,270
3,061
119,688
5,095
21,490
2,019
150,225
4,776
5,966
42,573
(81)
8,570
758
-
793
-
354,932
212,029
758
793
Finance costs
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Interest expense of financial
liabilities that are not at fair value
through profit or loss :
- finance leases
- loans
- overdrafts
- other borrowings
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
491
19,673
374
528
420
24,875
562
1,100
32
1,121
13
27
1,436
-
21,066
26,957
1,166
1,463
Recognised in profit or loss
10,269
13,332
1,166
1,463
Capitalised under property
development cost (Note 10)
10,797
13,625
-
-
21,066
26,957
1,166
1,463
120
22.
Profit before tax
Note
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Profit before tax is arrived at
after charging :
Auditors’ remuneration:
- Statutory audit
- current year
- KPMG
- Other auditors
- prior year
- Other auditors
- Other services
- current year
- KPMG
- Affiliate of KPMG
- Other auditors
- prior year
- Affiliate of KPMG
- Other auditors
Amortisation of intangible
assets
Depreciation on :
- property, plant and
equipment
Impairment loss on :
- trade receivables
- other receivables
equipment
- intangible assets
Write down of inventories
Write-off of :
equipment
- bad debts
Personnel expenses
(including key management
personnel):
- Wages, salaries and others
- Contributions to Employees
Provident Fund
Rental of premises
Rental of equipment
Loss on disposal of
property, plant and
equipment
139
41
132
52
35
-
33
-
3
-
-
-
10
29
64
14
60
20
6
6
39
6
10
-
7
2
2
-
-
5
8
10
-
-
3
4
6,605
2,184
8,409
2,841
925
280
877
350
373
2,213
1,656
361
-
-
-
3,646
527
664
-
-
14
149
126
286
201
3
149
20
22,061
29,235
6,731
6,810
2,137
2,966
153
3,149
3,645
208
696
76
62
776
100
22
-
-
1
15
3
5
121
annual report 2016
22.
Profit before tax (cont'd)
Note
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
and after crediting :
Gain on disposal of :
equipment
- investment in joint
venture
Rental income from
property
Bad debts recovered
Interest income
Gain on disposal of a
subsidiary
23.
32
36
-
434
5,179
-
-
-
34,242
-
34,157
5,329
276
1,432
4,695
1,486
1,851
701
2,837
-
6,021
-
-
-
Key management personnel compensation - Group
The key management personnel compensations are as follows:
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Directors of the Company :
- Fees
- Remuneration
Other Directors :
- Fees
- Remuneration
Other key management personnel :
- Salaries and others
- Short-term employee benefits
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
195
2,865
175
3,299
175
2,865
155
3,299
5
440
5
480
-
-
3,505
3,959
3,040
3,454
2,975
357
3,386
406
2,470
296
2,762
331
3,332
3,792
2,766
3,093
6,837
7,751
5,806
6,547
Other key management personnel comprise persons other than the Directors of Group entities, having
authority and responsibility for planning, directing and controlling the activities of the Group entities either
directly or indirectly.
The estimated monetary value of Directors’ benefit-in-kind of the Group and of the Company otherwise than
in cash are RM24,041 (2015: RM30,870).
122
24.
Tax expense
Recognised in profit or loss
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Income tax expense on continuing
operations
Share of tax of equity-accounted
associates and joint ventures
Total income tax expense
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
7,356
1,219
3,282
462
4,854
3,583
-
-
12,210
4,802
3,282
462
Major components of income tax expense include :
Note
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Current tax expense
Malaysian
- Current year
- Under/(Over) provision in
prior years
8,047
1,463
Total current tax recognised
in profit or loss
13,615
(171)
9,510
13,444
(1,792)
(363)
2,971
311
734
(272)
3,282
462
(11,136)
(1,089)
-
-
(2,155)
(12,225)
-
-
4,701
154
3,575
8
-
-
4,855
3,583
-
-
12,210
4,802
3,282
462
Deferred tax expense
Reversal of temporary
differences
Over provision in prior years
Total deferred tax
recognised in profit or loss
9
Share of tax of equityaccounted associates and
joint ventures
- Current year
- Prior years
123
annual report 2016
24.
Tax expense (cont'd)
Reconciliation of tax expense
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Profit for the year
10,394
12,210
22,175
4,802
19,449
3,282
35,995
462
Profit excluding tax
22,604
26,977
22,731
36,457
Income tax calculated using
Malaysian tax rate of 24%
(2015 : 25%)
Non-deductible expenses
Non-taxable income
Deferred tax assets not recognised
Effect of changes in tax rate
Utilisation of group relief
Others
Under/(Over) provision in prior years
5,425
4,940
(1,323)
2,099
(185)
1,254
6,744
6,206
(8,653)
1,863
(14)
(92)
(1,252)
5,455
793
(2,310)
(801)
(166)
311
9,114
533
(8,826)
(5)
(82)
(272)
12,210
4,802
3,282
462
The Malaysian Budget 2014 announced the reduction of corporate tax to 24% with effect from year of
assessment 2016. Consequently, the tax laibilities are measured using the tax rate of 24%.
25.
Earnings per ordinary share - Group
Basic earnings per ordinary share
The basic earnings per ordinary share has been calculated based on the profit attributable to ordinary
shareholders of RM10,543,000 (2015 : RM23,513,000) and a weighted average number of ordinary shares
of 445,527,000 (2015 : 445,527,000) ordinary shares in issue during the year.
Diluted earnings per ordinary share
The diluted earnings per ordinary share for the financial year as at 31 March 2016 and 31 March 2015 is
the same as the basic earnings per ordinary share for the financial year as the effects of dilutive potential
ordinary shares are ignored since the exercise price of the warrants is higher than the market price of the
Company’s ordinary shares.
26.
Operating segments - Group
The Group has four reportable segments, as described below, which are the Group’s strategic business
units. The strategic business units offer different products and services, and are managed separately
because they require different marketing strategies. For each of the strategic business units, the Chief
Operating Decision Maker (“CODM”) (i.e. the Group’s Chief Executive Officer) reviews internal management
reports at least on a quarterly basis.
124
26.
Operating segments - Group (cont'd)
The following summary describes the operations in each of the Group’s reportable segments:
•
•
•
•
Segment 1 : Includes property development activities, developed properties, property management
and tenancy management services.
Segment 2 : Includes building and construction activities.
Segment 3 : Includes operations of entertainment, food and beverage outlets.
Segment 4 : Includes investment holding and others.
Performance is measured based on segment profit before tax, as included in the internal management
reports that are reviewed by the CODM. Segment profit is used to measure performance as management
believes that such information is the most relevant in evaluating the results of certain segments relative to
other entities that operate within these industries.
Segment assets
The total of segment asset is measured based on all assets (including goodwill) of a segment, as included
in the internal management reports that are reviewed by the CODM. Segment total asset is used to measure
the return of assets of each segment.
Segment liabilities
Segment liabilities information is neither included in the internal management reports nor provided regularly
to the CODM. Hence, no disclosure is made on segment liabilities.
Segment capital expenditure
Segment capital expenditure is the total cost incurred during the financial year to acquire property, plant
and equipment, investment properties and intangible assets other than goodwill.
annual report 2016
125
26.
Property
development
and
management
RM’000
Construction
contracts
RM’000
13,090
5,130
297,404
17,070
Investment
holding and
others
RM’000
Total
RM’000
(1,698)
1,228
17,750
122,388
173,206
1,605
-
1,610
15,218
423,007
205,494
-
-
-
653,997
167,520
3,696
94,090
919,303
488
543
616
624
2,271
Food and
beverage
RM’000
1.4.2015 to 31.3.2016
Segment profit/(loss)
Included in the measure of
segment profit/(loss) are:
Revenue from external
customers
Inter-segment revenue
Share of loss/(profit)
of equity-accounted
- associates
- joint ventures
Segment assets
segment assets are:
Additions to non-current
assets other than
financial instruments
(1,895)
10,841
(1,895)
10,841
1.1.2014 to 31.3.2015
Segment profit/(loss)
segment profit/(loss) are:
Revenue from external
customers
Inter-segment revenue
Share of loss/(profit)
of equity-accounted
- associates
- joint ventures
Segment assets
segment assets are:
Additions to non-current
assets other than
financial instruments
13,853
(10,686)
(4,895)
25,122
23,394
215,071
17,586
43,599
127,581
6,639
-
4,876
11,160
270,185
156,327
-
-
-
589,846
147,904
8,644
166,930
913,324
603
8,365
210
1,938
11,116
(143)
8,951
(143)
8,951
126
26.
Geographical segments
The business of the Group only operates in Malaysia. As such, information on geographical segment is not
presented.
Major customers
The following are major customers with revenue equal or more than 10% of the Group’s total revenue :
Revenue
Customer A
Customer B
27.
2016
RM’000
2015
RM’000
104,669
61,860
34,147
-
Segment
Financial instruments
27.1 Categories of financial instruments
The table below provides an analysis of financial instruments categorised as follows:
(a)
(b)
Loans and receivables (“L&R”); and
Financial liabilities measured at amortised cost (“FL”).
Carrying
amount
RM’000
L&R
RM’000
251,138
26,945
52,776
251,138
26,945
52,776
330,859
330,859
80,957
10,229
3,523
80,957
10,229
3,523
94,709
94,709
2016
Financial assets
Group
Trade and other receivables (excluding non-refundable deposits
and prepayment)
Company
and prepayment)
annual report 2016
127
27.
27.1 Categories of financial instruments (cont'd)
Carrying
amount
RM’000
(Restated)
L&R
RM’000
(Restated)
2015
Financial assets
Group
and prepayment)
192,782
4,917
27,290
192,782
4,917
27,290
224,989
224,989
306,217
1,834
306,217
1,834
308,051
308,051
Carrying
amount
RM’000
FL
RM’000
252,082
240,897
252,082
240,897
492,979
492,979
22,567
114,243
22,567
114,243
136,810
136,810
Company
and prepayment)
2016
Group
Company
128
27.
27.1 Categories of financial instruments (cont'd)
Carrying
amount
RM’000
FL
RM’000
299,345
191,687
299,345
191,687
491,032
491,032
23,778
165,952
23,778
165,952
189,730
189,730
2015
Group
Company
27.2 Net gain and losses arising from financial instruments
Group
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Company
1.4.2015
1.1.2014
to
to
31.3.2016
31.3.2015
RM’000
RM’000
Net losses/(gains) on:
Loan and receivables
Financial liabilities measured
at amortised cost
1,027
732
(552)
21,066
26,957
1,166
1,463
22,093
27,689
614
1,483
27.3 Financial risk management
The Group has exposure to the following risks from its use of financial instruments:
•
•
•
Credit risk
Liquidity risk
Market risk
20
annual report 2016
129
27.
27.4 Credit risk
Credit risk is the risk of a financial loss to the Group if a customer or counterparty to a financial
instrument fails to meet its contractual obligations. The Group’s exposure to credit risk arises
principally from its receivables from customers. The Company’s exposure to credit risk arises
principally from advances to subsidiaries and financial guarantees given to banks for credit facilities
granted to subsidiaries.
Receivables
Risk management objectives, policies and processes for managing the risk
Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing
basis. Normally, credit evaluations are performed on cash purchases.
Exposure to credit risk, credit quality and collateral
As at the end of the reporting period, the maximum exposure to credit risk arising from receivables
is represented by the carrying amounts in the statement of financial position.
Management has taken reasonable steps to ensure that receivables that are neither past due nor
impaired are stated at their realisable values. The Group uses ageing analysis to monitor the credit
quality of the receivables. Any receivables having significant balances past due more than 90 days,
which are deemed to have higher credit risk, are monitored individually.
The Group maintains an ageing analysis in respect of trade receivables only. The ageing of trade
receivables (excluding amount due from contract customers and accrued billings). The ageing of
trade receivables as at the end of the reporting period was :
Gross
RM’000
Individual
impairment
RM’000
Net
RM’000
Group
2016
Not past due
Past due 1 - 30 days
Past due more than 120 days
123,032
1,580
164
272
4,048
7,269
(2,029)
123,032
1,580
164
272
4,048
5,240
136,365
(2,029)
134,336
130
27.
27.4 Credit risk (cont'd)
Receivables (cont'd)
Exposure to credit risk, credit quality and collateral (cont'd)
Gross
RM’000
Individual
impairment
RM’000
Net
RM’000
Group
2015
Not past due
Past due more than 120 days
51,244
671
259
224
10,963
(1,656)
51,244
671
259
224
9,307
63,361
(1,656)
61,705
Company
2016
Not past due
20,751
-
20,751
6,898
-
6,898
2015
Not past due
The movements in the allowance for impairment losses of trade receivables during the financial year/
period were :
Group
2016
RM’000
2015
RM’000
At beginning of year/period
1,656
-
Impairment loss recognised
373
1,656
2,029
1,656
At end of year/period
The allowance account in respect of trade receivables is used to record impairment losses. Unless
the Group is satisfied that recovery of the amount is possible, the amount considered irrecoverable
is written off against the receivable directly.
Investments and other financial assets
Investments are allowed only in liquid securities and only with counterparties that have a credit rating
equal to or better than the Group.
annual report 2016
131
27.
27.4 Credit risk (cont'd)
Investments and other financial assets (cont'd)
As at the end of the reporting period, the Group has only invested in domestic equity interests. The maximum
exposure to credit risk is represented by the carrying amounts in the statement of financial position.
Investments and other financial assets are unsecured.
Financial guarantees
The Company provides unsecured financial guarantees to banks in respect of banking facilities granted
to certain subsidiaries and joint venture. The Company monitors on an ongoing basis the results of the
subsidiaries and joint venture and repayments made by the subsidiaries and joint venture.
The maximum exposure to credit risk amounts to RM435,119,000 (2015 : RM426,558,000)
representing the outstanding banking facilities of the subsidiaries and joint venture as at end of the
reporting period.
As at end of the reporting period, there was no indication that any subsidiary and joint venture would
default on repayment.
The financial guarantees have not been recognised since the fair value on initial recognition was not
material.
Inter-company balances
The Company provides unsecured advances to subsidiaries and an associate. The Company
monitors the results of the subsidiaries and associate regularly.
As at the end of the reporting period, the maximum exposure to credit risk is represented by their
carrying amounts in the statement of financial position.
Advances are provided to wholly-owned subsidiaries and an associate by the Company.
Impairment losses
As at the end of the reporting period, there was no indication that the advances to the subsidiaries
and associate are not recoverable. The Company does not specifically monitor the ageing of the
advances to the subsidiaries and associate.
27.5 Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall
due. The Group’s exposure to liquidity risk arises principally from its various payables, loans and
borrowings.
The Group maintains a level of cash and cash equivalents and bank facilities deemed adequate by
the management to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities
when they fall due.
It is not expected that the cash flows included in the maturity analysis could occur significantly
earlier, or at significant different amounts.
27.
Non-derivative financial liabilities
Secured term loans
Company
Secured term loans
Bank overdrafts
Revolving credit
Group
2016
136,810
21,933
634
114,243
-
493,549
223,418
6,677
1,328
20,659
241,467
Carrying
amount
RM’000
4.95
2.38 - 2.98
-
4.95 - 8.35
2.38 - 3.50
8.35 - 8.60
4.33 - 7.85
-
Contractual
interest rate
%
579,397
29,351
684
114,243
435,119
548,211
277,496
7,261
1,328
20,659
241,467
Contractual
cash flow
RM’000
552,007
2,380
265
114,243
435,119
299,788
33,384
2,950
1,328
20,659
241,467
Under
1 year
RM’000
2,799
2,380
419
-
84,355
81,719
2,636
-
1-2
years
RM’000
7,139
7,139
-
75,729
74,054
1,675
-
2-5
years
RM’000
17,452
17,452
-
88,339
88,339
-
More than
5 years
RM’000
The table below summarises the maturity profile of the Group’s and the Company’s financial liabilities as at the end of the reporting period
based on undiscounted contractual payments:
Maturity analysis
27.5 Liquidity risk (cont'd)
132
27.
Secured term loans
Company
Secured term loans
Bank overdrafts
Revolving credit
Group
2015
Maturity analysis (cont'd)
27.5 Liquidity risk (cont'd)
189,730
23,192
586
165,952
-
491,032
272,938
9,384
1,523
15,500
191,687
Carrying
amount
RM’000
4.95
2.38 - 2.98
-
4.92 - 7.60
2.38 - 3.50
8.35 - 8.60
3.81 - 4.60
-
Contractual
interest rate
%
624,855
31,729
616
165,952
426,558
554,266
335,171
10,385
1,523
15,500
191,687
Contractual
cash flow
RM’000
595,248
2,380
358
165,952
426,558
248,688
36,187
3,791
1,523
15,500
191,687
Under
1 year
RM’000
2,548
2,380
168
-
25,933
23,279
2,654
-
1-2
years
RM’000
7,229
7,139
90
-
53,252
49,312
3,940
-
2-5
years
RM’000
19,830
19,830
-
226,393
226,393
-
More than
5 years
RM’000
annual report 2016
133
134
27.
27.6 Market risk
Market risk is the risk that changes in market prices, such as interest rates and other prices that will
affect the Group’s financial position or cash flows.
27.6.1
Interest rate risk
The Group’s investment in fixed rate financial instruments are exposed to a risk of change
in their fair value due to changes in interest rates. The Group’s variable rate borrowings
are exposed to a risk of change in cash flows due to changes in interest rates. Short term
receivables and payables are not significantly exposed to interest rate risk.
The Group adopts a policy of ensuring that exposure to loans and borrowings are kept
at a minimum.
Exposure to interest rate risk
The interest rate profile of the Group’s and the Company’s significant interest-bearing
financial instruments, based on carrying amounts as at the end of the reporting period
was:
Group
2016
2015
RM’000
RM’000
Company
2016
2015
RM’000
RM’000
Fixed rate instruments
Financial assets
9,322
(6,677)
7,678
(9,384)
(634)
(586)
2,645
(1,706)
(634)
(586)
18,268
(245,405)
(289,961)
10,229
(21,933)
(23,192)
(227,137)
(289,961)
(11,704)
(23,192)
Floating rate instruments
Financial assets
Interest rate risk sensitivity analysis
(a)
Fair value sensitivity analysis for fixed rate instruments
The Group does not account for any fixed rate financial assets and liabilities at fair
value through profit or loss. Therefore, a change in interest rates at the end of the
reporting period would not affect profit or loss.
(b)
Cash flow sensitivity analysis for variable rate instruments
A change of 50 basis points (“bp”) in interest rates at the end of the reporting
period would have increased/(decreased) equity and post-tax profit or loss by
the amounts shown below. This analysis assumes that all other variables remain
constant.
135
annual report 2016
27.
27.6 Market risk (cont'd)
27.6.1
Interest rate risk (cont'd)
(b)
Cash flow sensitivity analysis for variable rate instruments (cont'd)
Group
Profit or loss
50 bp
50 bp
increase
decrease
RM’000
RM’000
2016
863
(863)
1,087
(1,087)
44
(44)
87
(87)
2015
Company
2016
2015
27.7 Fair value information
The carrying amounts of cash and cash equivalents, short term investment, short term receivables
and payables and short term borrowings reasonably approximate their fair values due to the relatively
short term nature of these financial instruments.
The carrying amount of floating rate borrowings approximate their fair value as their effective interest
rate changes accordingly to movements in the market interest rates.
27.
Secured term loans
Company
Secured term loans
Group
2016
-
-
-
-
-
-
Level 2
RM’000
-
Level 1
RM’000
-
-
-
-
Level 3
RM’000
-
-
-
-
Total
RM’000
Fair value of financial instruments
carried at fair value
-
-
-
-
Level 1
RM’000
-
-
-
-
Level 2
RM’000
Total
RM’000
(22,571)
(21,933)
(638)
(22,571)
(21,933)
(638)
(230,250) (230,250)
(223,418) (223,418)
(6,832)
(6,832)
Level 3
RM’000
Fair value of financial instruments not
(22,571)
(21,933)
(638)
(230,250)
(223,418)
(6,832)
Total
fair value
RM’000
(22,567)
(21,933)
(634)
(230,095)
(223,418)
(6,677)
Carrying
amount
RM’000
The table below analyses financial instruments carried at fair value and those not carried at fair value for which fair value is disclosed, together
with their fair values and carrying amounts shown in the statement of financial position.
27.7 Fair value information (cont'd)
136
27.
Secured term loans
Company
Secured term loans
Group
2015
-
-
-
-
-
-
-
Level 2
RM’000
-
-
-
-
Level 3
RM’000
-
-
-
-
Total
RM’000
Fair value of financial instruments
Level 1
RM’000
-
-
-
-
Level 1
RM’000
-
-
-
-
Level 2
RM’000
Total
RM’000
(23,756)
(23,192)
(564)
(23,756)
(23,192)
(564)
(281,662) (281,662)
(272,938) (272,938)
(8,724)
(8,724)
Level 3
RM’000
Fair value of financial instruments not
(23,756)
(23,192)
(564)
(281,662)
(272,938)
(8,724)
Total
fair value
RM’000
(23,778)
(23,192)
(586)
(282,322)
(272,938)
(9,384)
Carrying
amount
RM’000
annual report 2016
137
138
27.
Fair value, which is determined for disclosure purposes, is calculated based on the present value
of future principal and interest cash flows, discounted at the market rate of interest at the end of the
reporting period. For borrowings, the market rate of interest is determined by reference to similar
borrowing arrangements.
Transfers between Level 1 and Level 2 fair values
There has been no transfer between Level 1 and 2 fair values during the financial year (2015 : no
transfer in either directions).
Level 3 fair values
Level 3 fair is estimated using unobservable inputs for the financial assets and liabilities.
The fair value of finance lease liabilities are calculated using discounted cash flows.
28.
Capital management - Group
The Group’s objectives when managing capital is to maintain a strong capital base and safeguard the
Group’s ability to continue as a going concern, so as to maintain investor, creditor and market confidence
and to sustain future development of the business. The Directors monitor and are determined to maintain
an optimal debt-to-equity ratio that complies with debt covenants and regulatory requirements.
There were no changes in the Group’s approach to capital management during the financial year.
29.
Capital and other commitments - Group
29.1 Other commitment
Purchase of LMC quota
Investment in a joint venture
2016
RM’000
2015
RM’000
-
2,200
16,000
30.Contingencies
The Directors are of the opinion that provisions are not required in respect of these matters, as it is not
probable that a future sacrifice of economic benefits will be required or the amount is not capable of reliable
measurement.
30.1 Corporate guarantees to certain subsidiaries and joint ventures
Corporate guarantees relating to credit facilities of subsidiaries
and joint ventures :
- granted
- utilised
2016
RM’000
2015
RM’000
747,516
435,119
795,531
426,558
139
annual report 2016
30.
Contingencies (cont'd)
30.2 Continuing financial support
The Company has undertaken to provide continuing financial support to certain subsidiaries to
enable them to meet their financial obligations as and when they fall due.
31.
Related parties
Identity of related parties
For the purposes of these financial statements, parties are considered to be related to the Group if the
Group or the Company has the ability, directly or indirectly, to control or jointly control the party or exercise
significant influence over the party in making financial and operating decisions, or vice versa, or where the
Group or the Company and the party are subject to common control. Related parties may be individuals
or other entities.
Related parties also include key management personnel defined as those persons having authority and
responsibility for planning, directing and controlling the activities of the Group either directly or indirectly
and entity that provides key management personnel services to the Group. The key management personnel
include all the Directors of the Group, and certain members of senior management of the Group.
The Group has related party relationship with its subsidiaries, associates, joint venture, Directors and key
management personnel.
Significant related parties transactions
Related party transactions have been entered into in the normal course of business under normal trade
terms. The significant related party transactions of the Group and the Company are shown below. The
balances related to the below transactions are shown in Notes 12 and 18.
1.4.2015
to
31.3.2016
RM’000
1.1.2014
to
31.3.2015
RM’000
6,416
3
-
131,017
1,347
74
29,988
49,519
2,813
167
-
Group
A.
Associates
-
-
Progress billings charged
Cleaning charges
B.
Joint venture
-
-
-
-
Progress billings charged
Commission income
Cleaning charges
Sales of LMC quota
140
31.
Related parties (cont'd)
Significant related parties transactions (cont'd)
Company
A.
Subsidiaries
-
Management fees charged
-
Rental changed
-
Purchase of property, plant and equipment
-
Administrative fee
-
Security service
-
Cleaning charges
-Rental
-
Utilities charges
5,818
1,234
5
48
632
72
27
197
11,160
2,325
288
74
91
33
321
The following transactions with Directors and key management personnel were carried out under terms not
more favorable than those generally available to the public or employee of the holding company and its
subsidiaries, or under negotiated terms which the Board of Directors, after deliberation, has believed to be
in the best interests of the Group.
1.4.2015
to
31.3.2016
RM’000
1.1.2014
to
31.3.2015
RM’000
255
961
1,094
2,909
6
-
95
78
Consultancy fee paid to a company in which certain Directors of a
subsidiary of the Company have interest
-
308
Performance fee paid to a company in which certain Directors of the
Company have interest
-
1,778
213
254
Cleaning fee charged to a company in which certain Directors of the
57
72
Electricity charged to a company in which certain Directors of the
21
-
Administrative fee paid to a company in which certain directors of the
29
-
Group
Progress billings charged to :
- Directors and key management personnel of the Group and of the
Company
- Close family members of Directors of the Company
Administrative fee charged to a director of the Company
Consultancy fee paid to a Director of a subsidiary
Rental charged to a company in which certain Directors of the
There were no other transactions with key management personnel and Directors of the Group other than
the remuneration package paid to them as disclosed in Note 23 to the financial statements.
141
annual report 2016
32.
Significant events
Significant events during the year are as follows :
(a)
The Company had on 22 May 2015, entered into a Shares Sale and Purchase Agreement with
Worldwide Platinum Holdings Sdn Bhd for the disposal of the entire 80% equity interest in Soju
Entertainment Sdn Bhd representing 8 ordinary shares of RM1.00 each for cash consideration of
RM8 only.
The disposal had the following effect on the Group’s assets and liabilities :
2016
RM’000
Inventories
Net identifiable liabilities
(7,527)
Gain on disposal
Non controlling interest
6,021
1,506
Consideration received satisfied in cash
-*
Less : Cash and cash equivalents disposed
(354)
Net cash outflow on disposal
(354)
*
33.
4,508
96
370
354
(12,855)
cash consideration of RM8
(b)
On 1 August 2015, the Company capitalised part of the net debts owing by its wholly owned
subsidiary, Ivory View Sdn Bhd (“IWSB”) by applying for and effecting the same as full
consideration for the subscription of 1,840,000 non-cumulative non-convertible redeemable
preference shares (“RPS”) of RM1 each in IWSB at a premium of RM99 per RPS, for a total
consideration of RM184,000,000.
(c)
On 26 October 2015, the Company acquired the entire issued and paid up share capital of Ivory
World City Sdn Bhd (“IWC”) and G Ivory Sdn Bhd (“G Ivory”) for a total cash consideration of RM2.00
each. Upon completion of the acquisition, IWC and G Ivory became the wholly-owned subsidiaries
of the Company.
Subsequent Events
(a)
On 25 May 2016, the Company entered into a Shares Sale and Purchase Agreement (“SSP”) with
Alshem Venture Sdn Bhd for the acquisition of the entire 100% issued and paid up shares in Alshem
Development Sdn Bhd, comprising 250,000 fully-paid ordinary shares of RM1.00 each for cash
consideration of RM17,760,000. The completion of the SSP is subject to fulfillment of conditions
precedent in the SSP.
(b)
On 9 June 2016, the Company proposed a private placement of up to ten percent (10%) of the
issued and paid-up share capital of the Company. Subsequently, on 22 July 2016, the Company
announced that the 44,552,702 placement shares which representing ten percent (10%) of the
issued and paid-up share capital were issued pursuant to the private placement and were listed and
quoted on the Main Market of Bursa Securities, marking the completion of the private placement.
(c)
On 17 June 2016, the Company announced that its wholly owned subsidiary, Ivory Times Square
Sdn Bhd has entered into a Joint Venture Agreement (“JVA”) with LLK Properties Sdn Bhd (formerly
known as Dsenergy Development Sdn Bhd) for the proposed development of all the 29 pieces of
leasehold land measuring approximately 3,351 square meter located at Mukim Petaling, Daerah
Kuala Lumpur, Negeri Wilayah Persekutuan. The completion of the JVA is still subject to fulfillment of
conditions precedent in the JVA.
142
34. Material Litigations
(a)
Diamex Sdn. Bhd. – Civil Suit No. 21NCVC-54-09/2015 filed at the Kuala Lumpur High Court
On 17 September 2015, the Company's wholly-owned subsidiary, Ivory Indah Sdn. Bhd. (“IISB”)
was served with a Civil Suit No: 21NCVC-54-09/2015 filed at the Kuala Lumpur High Court on
3 September 2015 (“Civil Suit”) from Diamex Sdn. Bhd. (“the Plaintiff) against IISB as the 1st
Defendant and 4 other Defendants claiming for several declarations and orders in connection with
the sale of a parcel of freehold land held under Geran No. 1272, Lot No. 2838, Mukim 18, Daerah
Timor Laut, Negeri Pulau Pinang owned by IISB.
The High Court has on 14 June 2016 allowed IISB’s application to strike out the plaintiff’s claim
and dismissed the Plaintiff’s application for injunction.
The Plaintiff has filed a Notice of Appeal dated 23 June 2016 against the High Court’s decision. It
is now pending for the Court of Appeal to assign the date for the appeal.
(b)
Krishna Kumar a/l T.N. Sharma – Civil Suit No. 22NCVC-102-06/2015 at Penang High Court
On 5 March 2015, Krishna Kumar a/l T.N. Sharma (“the Plaintiff”) had filed a Writ of Summons
& Statement of Claim (“Writ & Claim”) against Ivory Indah Sdn Bhd (“IISB”) in the High Court of
Malaya at Kuala Lumpur which was subsequently transferred to High Court of Malaya at Penang
under Civil Suit No. 22NCVC-102-06/2015.
The Writ & Claim is in relation to the sales of property by the Plaintiff to IISB in Year 2007 &
2008, with claims that IISB has abrogated the sales agreement and orders to restrain IISB from
disposing and dealing with the property until the final disposal of this case.
The matter was struck off by the Court on 8 September 2015. The Plaintiff’s application for
reinstatement was allowed by the High Court on 25 March 2016. The High Court has subsequently
dismissed IISB’s appeal against the reinstatement with cost.
IISB has filed two applications, one to strike out the Plaintiff’s claim and the other for Security
for Cost from the Plaintiff. The High Court has fixed the Decision for the said two applications on
12 August 2016.
35.
Comparative figures
(a)
In previous financial years, all investments in fixed deposits were classified as cash and cash
equivalents.
On 1 April 2015, the Group changed its accounting policy with respect to classification of cash and
cash equivalents. Short term investment held for investment purpose or with a maturity period of
more than 3 months are classified as short term investments.
This change in accounting policy was applied retrospectively. The following table summarised the
restatements made :
31.03.2015
As
previously
stated
RM’000
32,207
-
01.01.2014
As
restated
RM’000
As
previously
stated
RM’000
As
restated
RM’000
27,290
4,917
34,025
-
25,634
8,391
Group
Short term investment
(b)
The Company changed its financial year end from 31 December to 31 March since previous
financial period. Accordingly, the Company has prepared its financial statements for a
financial period of 12 months ended 31 March 2016, as compared to the comparative financial
statements, which covered a period of 15 months for the financial period ended 31 March 2015.
143
annual report 2016
36.
Supplementary information on the breakdown of realised and unrealised profits or losses
The breakdown of the retained earnings of the Group and of the Company as at year/period end, into
realised and unrealised profits, pursuant to the Paragraphs 2.06 and 2.23 of Bursa Malaysia Main Market
Listing Requirements, are as follows :
Group
2016
RM’000
2015
RM’000
Company
2016
2015
RM’000
RM’000
295,983
(1,396)
280,542
(3,550)
64,712
-
45,263
-
294,587
276,992
64,712
45,263
1,720
880
3,691
880
-
-
9,174
12
3,052
16
-
-
306,373
284,631
64,712
45,263
(125,095)
(113,896)
-
-
181,278
170,735
64,712
45,263
Total retained earnings of the
Company and its subsidiaries:
- Realised gain
- Unrealised loss
Total share of retained earnings of
associates
- Realised gain
- Unrealised gain
Total share of retained earnings of
joint ventures
- Realised gain
- Unrealised gain
Less : Consolidation adjustments
Total retained earnings
The determination of realised and unrealised profits is based on the Guidance of Special Matter No.1,
Determination of Realised and Unrealised Profits or Losses in the Context of Disclosures Pursuant to Bursa
Malaysia Securities Berhad Listing Requirements, issued by the Malaysian Institute of Accountants on
20 December 2010.
144
STATEMENT BY DIRECTORS
PURSUANT TO SECTION 169(15) OF THE COMPANIES ACT, 1965
In the opinion of the Directors, the financial statements set out on pages 67 to 142 are drawn up in accordance with
Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia so as to give a true
and fair view of the financial position of the Group and of the Company as of 31 March 2016 and of their financial
performance and cash flows for the financial year then ended.
In the opinion of the Directors, the information set out in Note 36 on page143 to the financial statements has been
compiled in accordance with the Guidance on Special Matter No.1, Determination of Realised and Unrealised
Profits or Losses in the Context of Disclosures Pursuant to Bursa Malaysia Securities Berhad Listing Requirements,
issued by the Malaysian Institute of Accountants, and presented based on the format prescribed by Bursa Malaysia
Securities Berhad.
Signed on behalf of the Board of Directors in accordance with a resolution of the Directors:
Penang
Date : 28 July 2016
annual report 2016
145
STATUTORY DECLARATION
PURSUANT TO SECTION 169(16) OF THE COMPANIES ACT, 1965
I, Dato’ Low Eng Hock, the Director primarily responsible for the financial management of Ivory Properties Group
Berhad, do solemnly and sincerely declare that the financial statements set out on pages 67 to 143 are, to the best
of my knowledge and belief, correct and I make this solemn declaration conscientiously believing the same to be
true, and by virtue of the provisions of the Statutory Declarations Act, 1960.
Subscribed and solemnly declared by the above named at Georgetown in the State of Penang on 28 July 2016.
…………………..…………………..
Before me :
GOH SUAN BEE (No. P125)
Pesuruhjaya Sumpah
(Commissioner of Oaths)
Penang
146
INDEPENDENT AUDITORS’ REPORT
To The Members Of Ivory Properties Group Berhad
Report on the Financial Statements
We have audited the financial statements of Ivory Properties Group Berhad, which comprise the statements of
financial position as at 31 March 2016 of the Group and of the Company, and the statements of profit or loss and
other comprehensive income, changes in equity and cash flows of the Group and of the Company for the year
then ended, and a summary of significant accounting policies and other explanatory information, as set out on
pages 67 to 142.
Directors’ Responsibility for the Financial Statements
The Directors of the Company are responsible for the preparation of financial statements so as to give a true and
fair view in accordance with Financial Reporting Standards and the requirements of the Companies Act, 1965 in
Malaysia. The Directors are also responsible for such internal control as the Directors determine is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply
with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on our judgement, including the assessment of risks of
material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments,
we consider internal control relevant to the entity’s preparation of the financial statements that give a true and
fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of entity’s internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of accounting estimates made by the
Directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinion.
Opinion
In our opinion, the financial statements give a true and fair view of the financial position of the Group and of the
Company as of 31 March 2016 and of their financial performance and cash flows for the year then ended in
accordance with Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia.
annual report 2016
147
INDEPENDENT AUDITORS’ REPORT
To The Members Of Ivory Properties Group Berhad
Report on Other Legal and Regulatory Requirements
In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following:
a)
In our opinion, the accounting and other records and the registers required by the Act to be kept by the
Company and its subsidiaries of which we have acted as auditors have been properly kept in accordance
with the provisions of the Act.
b)
We have considered the accounts and the auditors’ report of the subsidiaries of which we have not acted
as auditors, which are indicated in Note 6 to the financial statements.
c)
We are satisfied that the accounts of the subsidiaries that have been consolidated with the Company’s
financial statements are in form and content appropriate and proper for the purposes of the preparation
of the financial statements of the Group and we have received satisfactory information and explanations
required by us for those purposes.
d)
The audit reports on the accounts of the subsidiaries did not contain any qualification or any adverse
comment made under Section 174(3) of the Act.
Other Reporting Responsibilities
Our audit was made for the purpose of forming an opinion on the financial statements taken as a whole. The
information set out in Note 36 on page 143 to the financial statements has been compiled by the Company
as required by the Bursa Malaysia Securities Berhad Listing Requirements and is not required by the Financial
Reporting Standards in Malaysia. We have extended our audit procedures to report on the process of compilation
of such information. In our opinion, the information has been properly compiled, in all material respects, in
accordance with the Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses
in the Context of Disclosures Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, issued by the
Malaysian Institute of Accountants and presented based on the format prescribed by Bursa Malaysia Securities
Berhad.
Other Matters
This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the
Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person
for the content of this report.
KPMG
AF0758
Chartered Accountants
Date : 28 July 2016
Penang
Ooi Kok Seng
2432/05/17 (J)
Chartered Accountant
148
GROUP PROPERTIES
as at 31 March 2016
Location
Phase 3, 4 and 5
of Penang Times Square
Partial of No. Hakmilik 153461,
Lot 10000, Seksyen 10,
Bandar George Town,
Daerah Timor Laut,
Pulau Pinang.
Approximate
Age of
Build-up Approximate
Building Description/
Area
Land Area
(years) Existing Use
(sq. ft.)
(sq. ft.)
N/A
Currently
under
development
- Residential
and
Commercial
N/A
Carrying
Amount
as at 31
March
2016
Year of
Tenure (RM'000) Acquisition
229,725 Freehold
46,561
2005
No. Hakmilik 29375, 29376
and 29377,
Lot 954, 955 and 956,
Seksyen 10,
Bandar George Town,
Daerah Timor Laut,
Pulau Pinang.
2008
No. H.S.(D) 16611,
PT 26, Seksyen 10,
Bandar George Town,
Daerah Timor Laut,
Pulau Pinang.
2009
No. Hakmilik 6991,
Bandar George Town,
Daerah Timor Laut,
Pulau Pinang.
2011
Ivory Tower
Bandar George Town,
Daerah Timor Laut,
Pulau Pinang.
2
Office for
own use
48,766
N/A Freehold
22,271
2013
Birch House
Bandar George Town,
Daerah Timor Laut,
Pulau Pinang.
7
Commercial
18,710
18,140 Freehold
11,341
2008
Plaza Birch
Bandar George Town,
Daerah Timor Laut,
Pulau Pinang.
7
Residential
1,130
N/A Freehold
279
2010
annual report 2016
149
GROUP PROPERTIES
as at 31 March 2016
Location
Phase 1 & 2
of Penang Times Square
Bandar George Town,
Daerah Timor Laut,
Pulau Pinang.
Approximate
Age of
Build-up Approximate
Building Description/
Area
Land Area
(years) Existing Use
(sq. ft.)
(sq. ft.)
Carrying
Amount
as at 31
March
2016
Year of
Tenure (RM'000) Acquisition
4-7
Commercial
with Car
Parking
Bays
149,061
N/A Freehold
44,515
2008,
2010
-2013
Seri Taman Tanjung
No. Geran 70643,
Bandar Tanjong Tokong,
Daerah Timor Laut,
Pulau Pinang.
12
Residential
and
Commercial
with Car
Parking Bays
34,789
N/A Freehold
775
2004 &
2005
Plaza Ivory
No. Geran 2608,
Lot 10320, Mukim 13,
Daerah Timor Laut,
Pulau Pinang.
11
Commercial
with Car
Parking Bays
32,615
N/A Freehold
1,578
2006
No. H.S.(D) 18980,
PT 7, Seksyen 2,
Bandar Tanjong Tokong,
Daerah Timor Laut,
Pulau Pinang.
N/A
Currently
under
development
- Residential
and
Commercial
N/A
102,731 Freehold
60,692
2008 &
2011
No. Hakmilik 163292,
Bandar Bukit Mertajam,
Seberang Perai Tengah,
Pulau Pinang.
N/A
Currently
under
development
- Commercial
N/A
2,702 Freehold
1,968
2006
No. Hakmilik 1272,
Lot 2838, Mukim 18
Daerah Timor Laut,
Pulau Pinang.
N/A Development
Land*
N/A
2,344,088 Freehold
68,465
2013
*
Ivory Indah Sdn Bhd, a wholly-owned subsidiary of the Company has entered into a Sale and Purchase
Agreement to dispose of the land in last financial period. The sale transaction is currently in progess pending
fulfilment of the conditions precedent stated under the agreement.
150
ANALYSIS OF SHAREHOLDINGS
as at 27 June 2016
Authorised Share Capital
Issued and Paid-up Share Capital
Class of Shares
Voting Right
1.
:
:
:
:
RM500,000,000.00
RM222,763,513.50
One vote per share
ANALYSIS BY SIZE OF SHAREHOLDINGS
Size of shareholdings
2.
No. of
% of total
shareholders shareholders
No. of
shares
% of total
issued capital
Less than 100
100 to 1,000
1,001 to 10,000
10,001 to 100,000
100,001 to less than 5% of issued shares
5% and above of issued shares
159
330
2,047
2,059
284
5
3.26
6.76
41.91
42.16
5.81
0.10
7,043
170,137
13,656,158
67,121,551
185,567,683
179,004,455
0
0.04
3.07
15.07
41.65
40.18
TOTAL
4,884
100.00
445,527,027
100.00
No. of
Shares
% of total
issued capital
THIRTY LARGEST SECURITIES ACCOUNT HOLDERS
Name
1
RHB Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Low Eng Hock
67,000,000
15.04
2
MIDF Amanah Investment Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Low Eng Hock (MGN-LEH0004M)
35,165,455
7.89
3
Maybank Nominees (Tempatan) Sdn Bhd
28,510,000
6.40
4
Kenanga Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Khoo Siew Siew
24,230,000
5.44
5
Kenanga Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Low Eng Hock (027)
24,099,000
5.41
6
AMSEC Nominees (Tempatan) Sdn Bhd
18,230,766
4.09
7
RHB Nominees (Tempatan) Sdn Bhd
Bank of China (Malaysia) Berhad Pledged Securities Account for
Low Eng Hock
16,760,000
3.76
8
Ooi Choi Kiat
15,370,997
3.45
9
M & A Nominee (Tempatan) Sdn Bhd
Pledged Securities Account for Low Eng Hock (PNG)
9,000,000
2.02
8,550,000
1.92
10 RHB Capital Nominees (Tempatan) Sdn Bhd
annual report 2016
151
as at 27 June 2016
2.
THIRTY LARGEST SECURITIES ACCOUNT HOLDERS (cont'd)
No. of
Shares
% of total
issued capital
11 HLB Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Ooi Choi Kiat
6,750,000
1.52
12 JF Apex Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Teow Wooi Huat (STA 2)
6,420,800
1.44
13 Low Eng Hock
6,388,529
1.43
14 AMSEC Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Ooi Choi Kiat (MX3499)
4,000,000
0.90
15 Alliancegroup Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Low Eng Hock (8120716)
3,200,000
0.72
16 EB Nominees (Tempatan) Sendirian Berhad
Pledged Securities Account for M & A Securities Sdn Bhd (IPO)
3,000,000
0.67
17 M & A Nominee (Tempatan) Sdn Bhd
Pledged Securities Account for Khoo Siew Siew (PNG)
2,800,000
0.63
18 Tan Kim Hee
2,436,300
0.55
19 Cartaban Nominees (Asing) Sdn Bhd
Exempt An for Credit Industriel ET Commercial (AC Client)
2,237,375
0.50
20 Maybank Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Low Hooi Bee
2,137,500
0.48
21 Public Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Ooi Choi Kiat (E-SLY)
1,800,000
0.40
Chang Tan Sen
1,420,250
0.32
23 TA Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Tan Sin Lam
1,350,800
0.30
24 Boey Chee Kun
1,335,000
0.30
25 Maybank Securities Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Chia Tue Hua (REM 166)
1,200,500
0.27
26 Choong Mei Ling
1,063,000
0.24
27 Khoo Siew Siew
1,000,000
0.22
28 Affin Hwang Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Chai Chau @ Peh Chai Chau (M09)
900,000
0.20
29 Tan Bee Choon
900,000
0.20
30 Chong Siew Kim
840,000
0.19
Name
152
as at 27 June 2016
3.
SUBSTANTIAL SHAREHOLDERS
Name
1
2
4.
Ooi Choi Kiat
Direct Interest
No. of
% of
shares
issued
held
capital
216,903,750
27,920,997
48.68
6.27
Indirect Interest
No. of
% of
shares
issued
held
capital
31,030,000^
2,137,500^
6.96
0.48
DIRECTORS’ SHAREHOLDINGS
Name
1
2
3
4
5
6
^
Dr Asairinachan @ Aravinachan A/L
Kunjamboo
Ooi Choi Kiat
Loh Chye Teik
Lim Hock Siu
Direct Interest
No. of
% of
shares
issued
held
capital
45,000
216,903,750
10,000
27,920,997
295,000
195,750
0.01
48.68
6.27
0.07
0.04
Indirect Interest
No. of
% of
shares
issued
held
capital
31,030,000^
2,137,500^
-
6.96
0.48
-
Held in the name of spouse and is treated as interest of the Director in accordance with Section
134(12)(c) of the Companies Act, 1965.
Note: By virtue of his interest of more than 15% in the shares of the Company, Dato’ Low Eng Hock is
deemed to have interest in the shares of all the subsidiaries to the extent that the Company has an
interest.
annual report 2016
153
ANALYSIS OF WARRANTHOLDINGS
as at 27 June 2016
No of Warrants 2012/2017 Issued
Exercise/Conversion Price
Exercise/Conversion Ratio
Exercise/Conversion Period
Maturity Date
1.
:
:
:
:
:
186,000,000
RM0.75
One warrant for one ordinary share of RM0.50 each
5 years
26 April 2017
ANALYSIS BY SIZE OF WARRANTHOLDINGS
Size of warrantholdings
No. of
warrantholders
% of total
warrantholders
No. of
warrants
% of total
outstanding
warrants
3
129
613
644
138
1
0.20
8.44
40.12
42.15
9.03
0.07
190
93,547
3,824,900
25,690,065
62,210,532
94,180,766
0
0.05
2.06
13.81
33.45
50.63
1,528
100.00
186,000,000
100.00
Less than 100
100 to 1,000
1,001 to 10,000
10,001 to 100,000
100,001 to less than 5% of issued warrants
5% and above of issued warrants
TOTAL
2.
THIRTY LARGEST WARRANTHOLDERS
Name
No. of
warrants
% of
warrants
94,180,766
50.63
1
Low Eng Hock
2
Ooi Choi Kiat
5,609,332
3.02
3
Ting Ata @ Ting Teong Cheow
5,200,000
2.80
4
Lam Yee Foon
5,187,000
2.79
5
M & A Nominee (Tempatan) Sdn Bhd
Pledged Securities Account for Khoo Siew Siew (PNG)
4,000,000
2.15
6
HLB Nominees (Tempatan) Sdn Bhd
Pledged Securites Account for Ooi Choi Kiat
2,289,900
1.23
7
Kuek Yek Hing
1,350,000
0.73
8
Wan Cheng Hoe
1,150,000
0.62
9
Soo Lai Ping
1,070,000
0.58
949,000
0.51
10 Phnuah Farn Farn
154
as at 27 June 2016
2.
THIRTY LARGEST WARRANTHOLDERS (cont'd)
No. of
warrants
% of
warrants
11 Sonny Yap Choon Kar
900,000
0.48
12 Tam Shyh Yeau
900,000
0.48
13 Lee Ann Nee
850,000
0.46
14 Chew Shung Hyang
830,000
0.45
Malazura binti Mat Desa
820,000
0.44
16 Public Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Ooi Choi Kiat (E-SLY)
800,000
0.43
17 Goee Miow Kheng
787,200
0.42
18 Kong Khop Song
750,000
0.40
Pledged Securities Account for Low Hooi Bee
696,000
0.37
20 RHB Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Tan Wee Hwang
656,900
0.35
21 Quah Ai Luan
600,000
0.32
22 JF Apex Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Teow Chee Chow (STA 2)
540,500
0.29
23 Kong Khop Song
516,600
0.28
24 CIMSEC Nominees (Tempatan) Sdn Bhd
CIMB Bank for Yap Yee Huat (MY 1163)
512,500
0.28
25 Ayub bin Abd Aziz
500,000
0.27
26 Lee Choon Lim
500,000
0.27
27 Tan Geng Sing
500,000
0.27
28 Hasmah binti Adenan
470,000
0.25
29 Maybank Securities Nominees (Tempatan) Sdn Bhd
Pledged Securities Account for Chia Tue Hua (REM 166)
427,900
0.23
30 Kong Kou Choi
400,000
0.22
Name
annual report 2016
155
as at 27 June 2016
3.
SUBSTANTIAL WARRANTHOLDERS
Name
1
2
4.
Ooi Choi Kiat
Direct Interest
No. of
% of total
warrants outstanding
held
warrants
94,180,766
8,699,232
50.63
4.68
Indirect Interest
No. of
% of total
held
warrants
4,000,000^
696,000^
2.15
0.37
DIRECTORS’ WARRANTHOLDINGS
Name
1
2
3
4
5
6
^
Dr Asairinachan @ Aravinachan A/L
Kunjamboo
Ooi Choi Kiat
Loh Chye Teik
Lim Hock Siu
Direct Interest
No. of
% of total
held
warrants
20,000
94,180,766
8,699,232
20,000
46,600
0.01
50.63
4.68
0.01
0.03
Indirect Interest
No. of
% of total
held
warrants
4,000,000^
696,000^
-
2.15
0.37
-
Held in the name of spouse and is treated as interest of the Director in accordance with Section
134(12)(c) of the Companies Act, 1965.
156
NOTICE OF ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN THAT the Eleventh Annual General Meeting of Ivory Properties Group Berhad will
be held at Auditorium, Ivory Tower @ Penang Times Square, 81-11-1, Jalan Dato’ Keramat, 10150 George Town,
Penang, Malaysia on Friday, 26 August 2016 at 10.30 a.m. for the following purposes:AS ORDINARY BUSINESS
1.
To receive the Audited Financial Statements for the financial year ended 31 March
2016 together with the Reports of the Directors and Auditors thereon.
2.
To approve the payment of Directors’ fees of RM175,000 for the financial year ended
31 March 2016.
3.
To re-elect the following Directors who retire in accordance with Article 128 of
the Company’s Articles of Association and being eligible, offer themselves for
re-election:-
4.
Ordinary Resolution 1
(a)Dato’ Ooi Chin Loo
(b)Mr Lim Hock Siu
To re-appoint Messrs KPMG as Auditors of the Company and to authorise the
Directors to fix their remuneration.
AS SPECIAL BUSINESS
To consider and, if thought fit, to pass the following resolutions with or without modifications:5.
Ordinary Resolution
Authority to Issue Shares Pursuant to Section 132D of the Companies Act, 1965
“THAT pursuant to Section 132D of the Companies Act, 1965, and subject to the
approvals of the relevant Governmental and/or regulatory authorities, the Directors
be and are hereby empowered to issue shares in the Company from time to time
upon such terms and conditions and for such purposes and to such person or
persons as the Directors may deem fit provided that the aggregate number of shares
issued pursuant to this resolution does not exceed 10% of the total issued share
capital of the Company for the time being and that the Directors be and are also
empowered to obtain the approval from Bursa Malaysia Securities Berhad for the
listing of and quotation for the additional shares so issued and that such authority
shall continue to be in force until the conclusion of the next Annual General Meeting
of the Company or the expiration of the period within which the next Annual General
Meeting is required by law to be held or revoked/varied by resolution passed by the
shareholders in general meeting whichever is the earlier.”
6.
Ordinary Resolution
Proposed Renewal of Shareholders’ Mandate for Recurrent Related Party
Transactions of Revenue or Trading Nature
“THAT subject always to the Main Market Listing Requirements of Bursa Malaysia
Securities Berhad, approval be and is hereby given to the Company and its
subsidiaries (“Ivory Group”) to enter into and give effect to specified recurrent related
parties transactions of a revenue or trading nature of the Ivory Group with specified
classes of Related Parties (as specified in Section 2.3 of the Circular to Shareholders
dated 29 July 2016) which are necessary for the day-to-day operations, in the ordinary
course of business and are carried out at arm’s length basis on normal commercial
terms of Ivory Group which are not more favourable to the Related Parties than those
generally available to the public and are not detrimental to minority shareholders of
the Company and such approval shall continue to be in full force until:
annual report 2016
157
(a)the conclusion of the next Annual General Meeting (“AGM”) following this AGM;
(b)the expiration of the period within which the next AGM after the date it is required
by law to be held; or
(c)revoked or varied by resolution passed by shareholders in a general meeting.
whichever is earlier.
THAT authority be and is hereby given to the Directors of the Company to complete
and do all such acts and things as they may consider necessary or expedient in the
best interest of the Company (including executing all such documents as may be
required) to give full effect to the transactions contemplated and or authorised by
this Ordinary Resolution.”
7.
To consider any other business for which due notice shall have been given in
accordance with the Companies Act, 1965.
By Order of the Board
Tai Yit Chan (MAICSA 7009143)
Ong Tze-En (MAICSA 7026537)
Joint Company Secretaries
Penang, 29 July 2016
Notes:
1.
A proxy may but need not be a member of the Company and a member may appoint any person to be his
proxy without limitation and the provisions of Section 149(1)(b) of the Companies Act, 1965 shall not apply
to the Company. There shall be no restriction as to the qualification of the proxy. Where a member appoints
two (2) or more proxies, he shall specify the proportion of his shareholdings to be represented by each
proxy.
2.
Where a member of the Company is an authorised nominee as defined under the Securities Industry
(Central Depositories) Act, 1991 (“SICDA”), it may appoint at least one (1) proxy in respect of each Securities
Account it holds with ordinary shares of the Company standing to the credit of the said Securities Account.
3.
Where a member of the Company is an Exempt Authorised Nominee which holds ordinary shares in the
Company for multiple beneficial owners in one (1) Securities Account (“Omnibus Account”), there shall be
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 the SICDA.
4.
The instrument appointing a proxy shall be in writing under the hand of the appointer or of his attorney
duly authorised in writing or, if the appointer is a corporation, the proxy form must be executed under its
Common Seal or under the hand of its attorney.
5.
For the proxy to be valid, the proxy form duly completed must be deposited at the Company’s Registered
Office at Suite 16-1 (Penthouse Upper), Menara Penang Garden, 42-A Jalan Sultan Ahmad Shah, 10050
Penang, Malaysia, not less than forty-eight (48) hours before the time appointed for holding the meeting or
any adjournment thereof.
6.
In respect of deposited securities, only a Depositor whose name appears on the Record of Depositors on
18 August 2016 (General Meeting Record of Depositors) shall be eligible to attend the meeting or appoint
proxy to attend and/or vote on his/her behalf.
158
Explanatory Notes on Special Business
Authority to Issue Shares Pursuant to Section 132D of the Companies Act, 1965
The Ordinary Resolution 5 is a renewal of the general mandate given to the Directors of the Company to allot and
issue shares pursuant to Section 132D of the Companies Act, 1965 as approved by the Shareholders at the Tenth
Annual General Meeting (“AGM”) held on 17 September 2015.
The Ordinary Resolution 5, if passed, will empower the Directors of the Company to issue and allot shares in
the Company from time to time and for such purposes as the Directors consider would be in the interest of the
Company up to an amount not exceeding 10% of the Company’s issued capital for the time being. This authority
will, unless revoked or varied by the Company in general meeting, expire at the next AGM of the Company or the
period within which the next AGM of the Company is required by law to be held, whichever is the earlier.
The general mandate will provide flexibility to the Company for any possible fund raising activities, including but
not limited to further placing of shares, for purpose of funding future investment projects, working capital and/or
acquisitions as well as to avoid any delay and cost in convening general meetings to specifically approve such an
issuance of shares.
As at the date of the Notice, a total of 44,552,702 new ordinary shares of RM0.50 each in the Company were
issued pursuant to the mandate granted to the Directors at the last AGM which will lapse at the conclusion of the
forthcoming AGM to be held on 26 August 2016.
Proposed Renewal of Shareholders’ Mandate for Recurrent Related Party Transactions of Revenue or
Trading Nature
The Ordinary Resolution 6, if passed, will allow Ivory Group to enter into recurrent related party transactions
in the ordinary course of business with specified classes of related parties and avoid the necessity to convene
separate general meetings from time to time to seek shareholders’ approval when such recurrent related party
transactions occur. This would reduce substantial administrative time, inconveniences and expenses associated
with the convening of such meetings. The shareholders’ mandate is subject to renewal on an annual basis.
Further information on the proposed Ordinary Resolution 6 is set out in the Circular to Shareholders dated 29 July
2016.
Statement Accompanying Notice of Annual General Meeting Pursuant to Paragraph 8.27(2) of the Main Market
Listing Requirements of Bursa Malaysia Securities Berhad
Details of individuals who are standing for election as Directors
No individual is standing for election as a Director at the forthcoming AGM of the Company.
annual report 2016
PROXY FORM
For the 11th Annual General Meeting
CDS Account No.
No. of Shares Held
I/We ________________________________________________________________________________________________
(Full Name in Block Letters)
of ____________________________________________________________________________________________________
(Address)
being a member/members of the above Company appoint ________________________________________________
of____________________________________________________________________________________________________
(Address)
or failing him, ________________________________________________________________________________________
of ____________________________________________________________________________________________________
(Address)
as my/our Proxy to vote in my/our name(s) on my/our behalf at the Eleventh Annual General Meeting of the
Company to be held on Friday, 26 August 2016 at 10.30 a.m. and at any adjournment thereof in the manner
indicated below:Ordinary Resolutions
For
Against
1. To approve the payment of Directors’ fees of RM175,000 for the financial year ended
31 March 2016.
2. To re-elect Dato’ Ooi Chin Loo as a Director of the Company.
3. To re-elect Mr Lim Hock Siu as a Director of the Company.
4. To re-appoint Messrs KPMG as Auditors of the Company.
5. To empower the Directors to issue and allot shares up to 10% of the issued share
capital of the Company.
6. To renew Shareholders’ Mandate for recurrent related party transactions of revenue
or trading nature.
(Please indicate with an "X" in the appropriate box against each Resolution how you wish your proxy to vote. If no
instruction is given, this form will be taken to authorise the proxy to vote at his/her discretion.)
Dated this _________ day of ____________________ 2016.
Signature of Shareholder
Common Seal to be affixed here if
Shareholder is a Corporation
Notes:
1. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy without limitation and the
provisions of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company. There shall be no restriction as to the qualification
of the proxy. Where a member appoints two (2) or more proxies, he shall specify the proportion of his shareholdings to be represented by each
proxy.
2. Where a member of the Company is an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991 (“SICDA”),
it may appoint at least one (1) proxy in respect of each Securities Account it holds with ordinary shares of the Company standing to the credit
of the said Securities Account.
3. Where a member of the Company is an Exempt Authorised Nominee which holds ordinary shares in the Company for multiple beneficial
owners in one (1) Securities Account (“Omnibus Account”), there shall be 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 the SICDA.
4. The instrument appointing a proxy shall be in writing under the hand of the appointer or of his attorney duly authorised in writing or, if the
appointer is a corporation, the proxy form must be executed under its Common Seal or under the hand of its attorney.
5. For the proxy to be valid, the proxy form duly completed must be deposited at the Company’s Registered Office at Suite 16-1 (Penthouse
Upper), Menara Penang Garden, 42-A Jalan Sultan Ahmad Shah, 10050 Penang, Malaysia, not less than forty-eight (48) hours before the time
appointed for holding the meeting or any adjournment thereof.
6. In respect of deposited securities, only a Depositor whose name appears on the Record of Depositors on 18 August 2016 (General Meeting
Record of Depositors) shall be eligible to attend the meeting or appoint proxy to attend and/or vote on his/her behalf.
Personal Data Privacy
By submitting the duly executed proxy form, the member and his/her proxy consent to the Company and/or its agents/service providers to collect,
use and disclose the personal data therein in accordance with the Personal Data Protection Act 2010, for the purpose of the Annual General
Meeting of the Company and any adjournment thereof.
Please fold here
Affix
Stamp
Joint Company Secretaries
Ivory Properties Group Berhad (673211-M)
42-A Jalan Sultan Ahmad Shah
10050 Penang
Malaysia
Please fold here
81-11-1, Jalan Dato’ Keramat
10150 George Town, Penang, Malaysia
Tel : (604) 2108000 Fax : (604) 2270000
www.ivory.com.my

Growing - Bursa Malaysia Stock

Transcription

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