LBS AR2020 Part 2 FINAL.Pdf

PURPOSEFULLY STRATEGISING, RESILIENTLY ADAPTING Tough times don’t last. Tough people do. In embracing the new normal, we have got down to adopting the right strategies to ensure the Group’s sustainable growth and to help communities. By anticipating the obstacles that may come our way, we are proactively ensuring we have the solutions in hand to overcome such challenges. We are also resiliently adapting to market changes and realigning our goals to stay on track. In 2020, as we adjusted our targets to adapt to the highly unstable operating environment, we not only met but exceeded our initial expectations by the year’s end. As we venture forth, we will continue to adapt and think progressively to ensure solid business fundamentals. 56 LBS BINA GROUP BERHAD ANNUAL REPORT 2020 PURPOSEFULLY STRATEGISING, RESILIENTLY ADAPTING Tough times don’t last. Tough people do. In embracing the new normal, we have got down to adopting the right strategies to ensure the Group’s sustainable growth and to help communities. By anticipating the obstacles that may come our way, we are proactively ensuring we have the solutions in hand to overcome such challenges. We are also resiliently adapting to market changes and realigning our goals to stay on track. In 2020, as we adjusted our targets to adapt to the highly unstable operating environment, we not only met but exceeded our initial expectations by the year’s end. As we venture forth, we will continue to adapt and think progressively to ensure solid business fundamentals. 57 GROUP FINANCIAL HIGHLIGHTS 20161 20172 2018 2019 2020 Revenue (RM’000) 993,619 1,347,412 1,122,088 1,325,260 1,096,331 Profit before tax (RM’000) 143,954 189,527 159,135 154,065 130,990 Profit after non-controlling interests (RM’000) 85,301 102,687 85,560 67,511 51,322 Share capital (RM’000) 641,424 * 901,193 922,232 922,473 922,887 Equity attributiable to owners of the parent (RM’000) 1,165,819 1,282,514 1,349,454 1,348,655 1,377,094 Basic earnings per share (sen) 6.58** 6.99 5.53 3.93 2.65 Gross dividend per share - ordinary share (sen) 10.00 8.20 1.80 -# 1.45 ## - redeemable convertible preference share (“RCPS”) (sen) - - 6.60 6.60 6.60 Net assets per share (sen) 181.77@ 186.70@ 86.57 87.25 88.18 Remarks 1 The comparatives have not been restated following the first-time adoption of the MFRS framework, adoption of MFRS 9 - Financial Instruments and MFRS 15 - Revenue from Contracts with Customers. 2 Restated following the adoption of the MFRS framework, MFRS 9 and MFRS 15. * Does not include eff ects from adoption of Companies Act 2016 - transition to no par value. ** The comparative figures for basic earnings per share have been restated to reflect the adjustments arising from the share subdivision and bonus issue. # Share dividend distribution on the basis of 3 treasury shares for every 100 existing ordinary shares held, fractions of treasury shares will be disregarded. ## Single-Tier First and Final Dividend to be approved by the shareholders at the forthcoming 21st Annual General Meeting. @ The comparative figures have not been restated to reflect the adjustments arising from the share subdivision and bonus issue. FINANCIAL CALENDAR Financial Year Ended 31 December 2020 Announcement of Quarterly Results: First Quarter ended 31 March 2020 30 June 2020 Second Quarter ended 30 June 2020 27 August 2020 Third Quarter ended 30 September 2020 30 November 2020 Fourth Quarter ended 31 December 2020 25 February 2021 58 LBS BINABINA GROUPGROUP BERHADBERHAD ANNUAL REPORTREPORT 20202020 REVENUE EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT (RM’000) (RM’000) 1,500,000 1,500,000 1,377,094 1,347,412 1,325,260 1,282,514 1,349,454 1,348,655 1,200,000 1,122,088 1,096,331 1,200,000 1,165,819 993,619 900,000 900,000 600,000 600,000 300,000 300,000 YEAR YEAR 16 1 17 2 18 19 20 16 1 17 2 18 19 20 PROFIT BEFORE TAX NET ASSETS PER SHARE (RM’000) (SEN) 200,000 189,527 200.00 181.77@ 186.70@ 159,135 154,065 160,000 143,954 160.00 130,990 120,000 120.00 86.57 87.25 88.18 80,000 80.00 40,000 40.00 YEAR YEAR 16 1 17 2 18 19 20 16 1 17 2 18 19 20 PROFIT AFTER NON-CONTROLLING INTERESTS BASIC EARNINGS PER SHARE (RM’000) (SEN) 125,000 10.00 102,687 100,000 8.00 85,301 85,560 6.58** 6.99 75,000 67,511 6.00 5.53 51,322 3.93 50,000 4.00 2.65 25,000 2.00 YEAR YEAR 16 1 17 2 18 19 20 16 1 17 2 18 19 20 59 MANAGEMENT DISCUSSION AND ANALYSIS LBS continued to deliver a resilient performance for the financial year ended 31 December 2020 (“FY2020”) despite a volatile operating environment characterised by the ongoing COVID-19 pandemic and related lockdowns, among other challenges. This Management Discussion and Analysis (“MD&A”) aims to provide an overview of the Group’s business, strategic direction as well as financial and operational performance for the year under review. It also serves to highlight the measures put in place to ensure the sustainable growth of LBS’ businesses and the endeavours to deliver long-term value to its many stakeholders. OUR BUSINESS AND STRATEGIC OBJECTIVES LBS is an investment holding company that through its subsidiaries is involved in property development and investment activities primarily in Malaysia and the People’s Republic of China. Even as LBS continues to grow from strength to strength as a reputable Property Developer, the Group has also ventured into several other business segments such as Construction and Trading; Management and Investment; as well as the Motor Racing Circuit segment, among others. (For more information on LBS, refer to the “About LBS” section at the start of this Annual Report). Our strategic objectives align with our overall goal of generating intentional and sustainable growth. Comprising both financial and non-financial objectives, these strategic imperatives also serve as benchmarks by which we can effectively gauge the Group’s progress over the short and long-term. OUR FINANCIAL OBJECTIVES For the year 2020, as per the previous year, LBS’ initial financial objectives revolved around securing growth in profits and asset value. To meet the first objective, we set our sights on increasing our project portfolio through the launch of a greater quantum of projects and by securing higher margins. To grow our asset value, we set out to increase the value of our portfolio through expediting the relevant action plans and leveraging on market demand. However, given the unexpected disruption by the COVID-19 pandemic and the related lockdowns, we had to review and reset our strategies to accommodate the new playing field. These strategic-related activities included the revision and adjustment of our sales target to a more feasible target following the evaluation of market sentiment then as well as digitalising our internal structure to cut down costs and increase efficiencies. The Group also continued to cater to market demand with the launch of more affordable homes. OUR NON-FINANCIAL OBJECTIVES The Group’s non-financial objectives are anchored on our brand promise “Empowering Individuals, Enhancing Communities”. Our efforts towards this aim are rolled out under the following four thrusts: Empowering Malaysians through making it easier for them to own their dream homes at CUSTOMERS affordable prices; ENVIRONMENT To improve our business environment for sustainable long-term value creation; To enhance our spaces and facilities while creating a better environment and COMMUNITY fostering community ties; and EMPLOYEES To empower individuals through opportunities for training and growth. 60 LBS BINA GROUP BERHAD ANNUAL REPORT 2020 We present a summary of our fi nancial and non-fi nancial objectives and their impact below: Financial Objectives GROWTH Growth in Profit Growth in Asset Value The expansion of our project portfolio and The increase in value of our portfolio increase in margins generated by our actions and market influences OUTCOME Dividend Capital Gain Dividend Policy fixed by the Company Appreciation of asset value MEASURE Total Business Return Net Asset Value Enlarged capital base of the business Overall acceleration in asset value INFLUENCES Market Sentiment Responds to External factors Internal factors Influence ∞ Economic conditions ∞ Type of products ∞ Customer service ∞ Government policies ∞ Pricing ∞ Company reputation ∞ Interest rates ∞ Location ∞ Operational e ciency TARGETS Leading Total Shareholder Return toward Dividend payment Share Price growth common The financial value of dividend The increase in market price target paid to shareholders of our quoted shares Non-Financial Objectives GOOD CORPORATE PRACTICES OUTCOMES Customers Assist Malaysians to own their dream homes at aordable prices Brand Stronger LBS Environment Brand and reputation Improve business environment while minimising negative impact Sustainable Communities Long-term sustainable Contribute to society growth and prospects Employees Develop human resource pool of skillful people with business ethics As we continue to advance forward and reinforce our role as a key industry player, we will look to these objectives to guide our operations and safeguard our growth-trajectory especially amidst these challenging times. With our operational boundaries set and our goals outlined, we remain committed to running our business in a manner that will strengthen our performance and our brand reputation whilst ensuring the Group’s long-term sustainability. 61 Management Discussion And Analysis (Cont’d) 2020’S OPERATING ENVIRONMENT The onset of the COVID-19 pandemic in 2020 marked the beginning of a global economic disruption.

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