Group at a Glance

(All figures in Sri Lankan Rupees thousands unless otherwise stated)

For the year ended 31st March 2008 2007 % Change

Group revenue 15,583,756 9,620,950 62 Profit from operations 6,152,842 3,366,174 83 Profit before taxation 5,316,352 2,791,801 90 Profit after taxation 3,873,481 2,099,944 84 EBITDA 6,110,383 3,366,119 82 Profit attributable to ordinary shareholders* 1,490,660 811,641 84 Dividend - ordinary dividend 50,000 55,000 (9) Shareholders’ funds** 8,845,584 7,312,998 21 Net assets 21,259,634 17,571,527 21 Total assets 36,065,771 30,330,072 19 Return on ordinary shareholders’ funds (%) 17 11 53 Earnings per share (Rs.) 148.34 80.37 85 Cash Earnings per share (Rs) 351.92 81.94 329 Net assets per ordinary share (Rs.) 884.56 731.30 21 Market capitalisation (Company) Rs. Mn 14,000,000 13,390,000 5 Enterprise value - Rs mn 32,718,360 29,699,689 (10) Revenue to Government (including associates’ income tax) 3,249,710 2,750,180 18 Group value addition 12,077,712 7,674,123 57 Group employment (Nos.) 6,581 5,576 18

* Excluding minority shareholders ** Excluding preference share and minority shareholders.

Contents Group at a Glance 1 Group Structure 2 Chairman’s Statement 3 Summary of Operating Segments 4 Business Review 5 Report of the Directors 8 Audit Committee Report 16

Financial Reports Report of the Auditors 21 Income Statements 22 Balance Sheets 23 Statements of Changes in Equity 24 Cash Flow Statements 25 Notes to the Financial Statements 26 Five Year Summary 111 Statement of Value Added 113 US Dollar Financials 115 Profiles of Directors 122 Group Directorate 130 Information to Shareholders and Investors 132 Value of Real Estate and Properties 134 Glossary of Financial Terms 135 Notice of Meeting 136 Form of Proxy Enclosed

Annual Report 2007/08 Bukit Darah PLC  Group Structure

Oil Palm Beverage Real Estate Hotels Investment Management Plantations & Holding & Services Airlines Financial Services

Sri Lanka Shalimar (Malay) PLC • Lion Brewery • Equity One PLC • Carsons Airline • Carson Cumberbatch • Carsons Management • 1909* • 91.06% (Ceylon) PLC • 1981* •94.59% Services (Private) Limited PLC Services (Private) Limited •1996* •54.9% • 1993* • 100% • 1913* • 46.4% • 1993* • 100%

• Selinsing Co. PLC • CBL Retailers (Private) • Equity Two PLC • Pegasus Hotels • Ceylon Guardian • Guardian Fund • 1907* • 86.25% Limited • 1990*• 88.81% of Ceylon PLC Investment Trust PLC Management Limited • 2007* • 100% •1966* • 92.75% • 1951* • 66.65% • 2000* • 100%

• Indo-Malay PLC • Equity Three • Equity Hotels Limited • Ceylon Investments • Carson Real Estate • 1906* •76.76% (Private) Limited •1970* • 100% PLC Services (Private) Limited • 1990* • 100% • 1919* • 63.42% • 2007* • 100%

• Good Hope PLC • Equity Five Limited • Ceylon Brewery • Agro Harapan Lestari • 1910* •86.91% • 1994* • 100% PLC (Private) Limited • 1910* •74.93% • 2008* •100%

• Equity Seven Limited • Watapota Investments • 1994* • 100% PLC • 1920* • 86.77%

• Equity Nine • Rubber Investment (Private) Limited Trust Limited •2006* •100% • 1906* • 100%

• Equity Developers • Weniwella (Private) Limited Investments Limited • 2006* •100% • 1906* • 77.72%

• Equity Property • Mylands Developers (Private) Investments Limited Limited • 1920* • 92.66%. •2007* •100% • Leechman & Company • Equity Lands (Private) (Private) Limited Limited • 1953* • 100% •2006* •100%

• Union Assurance PLC + • 36.97%

• The Unit Trust Management Co. (Private) Limited + •22%

• ACW Insurance (Private) Limited + • 50%

Indonesia • PT Agro Indomas • PT Agro Harapan • 84.5%. Lestari • 2007* • 1989* Indonesia • 60%

• PT Agro Bukit • 90% + • 2004* Indonesia

Malaysia • Shalimar Developments • Agro Harapan Lestari Sdn. Bhd. Sdn. Bhd • 1980 • 2007* • 60% • Malaysia* • 100%

Singapore • Goodhope Asia Holding Limited • 2008* • 100%

 % refers to group interest. + refers to Associated Companies + Refer to year of incorporation

 Annual Report 2007/08 Bukit Darah PLC Chairman’s Statement

Dear Shareholders, has within its portfolio a land bank of approximately 80,000 ha (inclusive of PTAB) and a processing I am pleased to welcome you to the ninety second capacity of 180MT/hr. Annual General Meeting of the Company and on behalf of the Board of Directors take pleasure in The other key investment held by the Company, presenting to you the Annual Report and Audited is a 46.4% stake in Carson Cumberbatch PLC Accounts of the Company for the year ended (CCPLC), which has exposure to a diverse group of 31st March 2008. businesses. The consolidated profit after tax of Carson Cumberbatch Group amounted to Rs. 3.5 bn this year, Bukit Darah PLC recorded a consolidated turnover recording a growth of 89% over the previous year. of Rs. 15.58 bn and a profit after tax of Rs. 3.87 bn, This consolidated performance for the year 2007/08 representing a growth of 62% and 84% respectively. was the best ever achieved by Carsons up to now. This includes the profit attributable from Carson As a group, each of the core sectors have achieved Cumberbatch PLC; as well as the Indonesian oil palm results that were reflective of the industry conditions plantation, PT Agro Bukit, owned by the Company. they faced and the management processes in Shareholders’ funds amounts to Rs. 8.8 bn, a place to ensure returns from these businesses over growth of 21%. time. A more detailed comment is available in the Operational Review. The year under review saw the two main investment holdings within the Company perform well, recording Against the backdrop of this performance from strong growth in earnings and undertaking expansion the Company’s two key investment holdings, we programmes that will sustain their ability to grow are confident that above average value creation over the years. PT Agro Bukit (PTAB), now has to shareholders will continue in the years to come. approximately 15,000 ha of oil palm that has been As we look forward to the future, it is important fully developed and will be coming into maturity in to mention that the business of Bukit Darah PLC, stages over the next few years. PTAB recorded a is now invariably inter-linked with that of Carson profit after tax of over US $ 650,000 inclusive of a Cumberbatch PLC and that both companies share gain from changes in fair value of biological assets. in the risks, rewards and returns from a common business base. Thus the performance of the Carsons Oil palm prices reached record highs in recent times Group business portfolio and in particular the oil palm in the face of rising commodity prices worldwide. plantation business will have a direct bearing on the Although price levels may not remain at such future performance and profitability of this company. unprecedented levels for too long, we anticipate that the edible oil market will continue to grow in a I take this opportunity to thank my fellow Directors, sustainable manner in the medium term, satisfying business associates, regulatory authorities and the demand originating from the emerging markets of financial institutions for the support extended to China and India, as well as the growing diversity of us in developing our business and taking forward uses for the commodity in the edible and its investment programme. I especially thank the non-edible categories. The regeneration of interest in shareholders for their support and interest over the bio fuels as a result of high petroleum prices will also years and express my confidence that our business be a supportive trend in the growth of the vegetable portfolio will continue to create substantial value to oils market. Thus PTAB will be well positioned to you into the future. derive the benefits of the global palm oil market when the plantation reaches maturity. PTAB continues (Sgd.) to be managed synergistically within the overseas Hari Selvanathan plantation sector of Carson Cumberbatch PLC, of Chairman which this company is the ultimate parent. Carsons 26th May 2008

Annual Report 2007/08 Bukit Darah PLC  Summary of Operating Segments

Bukit Darah PLC and consolidated subsidiaries and associates

(In Sri Lankan Rupees Thousands) For the years ended March 31 2008 2007 2006 2005

REVENUE Investment Holdings & Financial Services 2,438,139 2,438,070 1,902,113 1,039,660 Oil Palm Plantations 9,032,017 3,908,296 3,349,096 2,603,318 Beverage 5,226,613 3,973,233 3,841,710 3,080,352 Real Estate 136,722 97,767 90,572 84,714 Hotels 163,873 119,611 49,938 92,347 Airlines 7,760 11,367 6,796 9,107

Management Services 845,576 124,619 105,672 78,397 17,850,700 10,672,963 9,345,897 6,987,895 Share of Associate Companies’ Revenue (624,512) (486,925) (399,503) (330,499)

Intra-group Transactions (1,642,432) (565,088) (723,496) (450,285)

CONSOLIDATED REVENUES 15,583,756 9,620,950 8,222,898 6,207,111

SEGMENT PROFIT Investment Holdings & Financial Services 731,256 1,243,853 669,676 348,603 Oil Palm Plantations 3,243,767 1,067,056 1,098,269 3,221,111 Beverage 178,841 13,883 352,182 334,470 Real Estate 69,559 207,012 207,538 22,703 Hotels (31,290) (42,574) (46,311) (28,444) Airlines 912 3,023 (3,927) (6,252)

Management Services 193,946 (35,229) (9,298) (23,484) 4,386,991 2,457,024 2,268,129 3,868,707 Intra-group Transactions (513,510) (357,080) (397,094) (288,783)

Amortisation of Goodwill – – (37,614) 243,970

CONSOLIDATED NET EARNINGS 3,873,481 2,099,944 1,833,421 3,823,894

 Annual Report 2007/08 Bukit Darah PLC Business Review

PT Agro Bukit The agronomy and plantation management policies The oil palm industry had a good year with prices and procedures adopted within the Carsons agro reaching new heights on the back of strong sentiments group plantations sector will be replicated with within the oils & fats industry with the expectation of refinement to suit site condition, thereby deriving continued demand growth particularly for palm oil. synergies and leveraging on learning experiences of Crop production in Indonesia exceeded expectations, other mature plantations within the Group. whilst crop production in Malaysia remained at previous year’s levels. The favourable health and The company is working towards meeting the nutritional properties of palm oil, versatility of use in environmental and social concerns in plantation a variety of products, complemented by increasing development; and obtained ISO 14001 certification demand from larger economies like China and India for environmental management systems during due to economic growth and greater urbanisation will the year, and the internal framework has been continue to drive the demand for palm oil. put in place to ensure continuous adherence and compliance to ISO requirements. The systems and The development and planting of the first phase of processes in place will also facilitate the company to the project has now been fully completed, and the integrate with the requirements of the Roundtable on initial land area planted will come into maturity during Sustainable Palm Oil. the forthcoming financial year 2008/9. Required infrastructure facilities inclusive of construction The management expertise for this plantation has of main and collection road network, permanent been sourced through the plantation management housing facilities for the workforce & management, companies of CCPLC. office & other civil structures are being developed in line with the project plan and commensurate with the Carson Cumberbatch PLC (CCPLC) pace of development of the project. As mentioned earlier, the global market for palm oil and the management efficiencies derived from the The project focus now shifts from a development continued emphasis on productivity, permitted the project to a project under maturity; together with this Carsons Group to record a profit after tax of change comes a new set of challenges facing the Rs. 3.17 bn from this sector. Its key investment management with the need to sustain productivity in Indonesia - PT Agro Indomas - jointly held by of plantations, achieving cost competitiveness in CCPLC, the four plantation companies owning production, and derive continuous productivity and plantations in Malaysia, and by Bukit Darah PLC efficiency gains. - has now reached full maturity and plans are

Annual Report 2007/08 Bukit Darah PLC  Business Review

underway to make further investments in other parts integral part of the Carsons Group plantation sector, of Indonesia. to enable it to share the resource base, expertise and systems created within the Group. The maturing of larger extents of land will support the sustainability of the sector’s cashflow generating The other diverse businesses of the Group capacity, while a re-investment programme is performed in line with industry trends. The brewery underway to reach a sufficient scale and size of sector, once again felt the impact of industry operation that will enable the Carsons plantation sector conditions related to high taxation, low market to derive economies of scale and command sufficient access and inadequate law enforcement to curb bargaining power in the market. As such, as mentioned illicit liquor. The result was a lower growth in soft in the Chairman’s Statement, PTAB too is being alcohol consumption when compared with hard managed collectively with this land bank to optimise alcohol and illicit liquor. Nevertheless, the brewery the benefits derived from the combined operation. sector of Carsons has been successful in effectively holding its market share. The sector has expanded Plantation management companies based in its scope of operations to cover the Indian market, Indonesia, Malaysia and Sri Lanka, have been having invested in a 22% stake in a joint venture with created within the Carsons Group to centralise the Carlsberg to brew and distribute Carlsberg beer and key resources of the sector in terms of skills, systems its associated brands in the North, East and West of and processes at a corporate level, so that they can India. The entry to this lucrative market will enable be effectively shared between the operating units. the sector to capture the growth opportunities of the The agronomy, technical and logistics functions are vast Indian market. The partnership with Carlsberg based in the operating environments in Jakarta and will strengthen the competitiveness of this venture, Kuala Lumpur, while management support services given the likelihood of greater competition as a result have been sourced from Sri Lanka to ensure both of most multinational brewers entering India. compliance and cost effectiveness. Thus, for all intents and purposes, PTAB is managed as an

 Annual Report 2007/08 Bukit Darah PLC Business Review

The Carsons Group’s investment sector recorded a Conclusion lower level of profits this year, as the opportunities Into the future, we are confident that the performance for recording capital gains through trading as well of the two key investment holdings of this company as realising returns from long-term investments have the capacity to capture the growth opportunities was limited. However, the sector has made some in their respective businesses. Both PTAB and acquisitions in the retail, healthcare and F&B CCPLC have set in place management processes, segments in order to ensure the long-term growth practices and systems that can sustain this growth of the portfolio and its future profitability. The capital process into the future. Within CCPLC, each sector markets of Sri Lanka were fully reflective of the has drawn up plans to create the human resource and state of the economy and the country situation, and financial capacity required to fund its expansion plans. the subdued conditions in the equity markets was The investments and real estate sectors too have set mirrored in the high interest rate environment that up their own dedicated management companies that prevailed in the fixed income market, as inflationary will focus on building up the key resources for the pressures mounted. sector to undertake their respective expansion plans. As such, we believe that shareholders will benefit in The real estate sector, backed by its land bank of time to come from the collective performance of these over 20 acres in the City and suburbs of Colombo, two investment holdings. embarked on its suburban housing property development initiative. This will add to the profitability As mentioned in the Chairman’s Statement, the of the sector, enabling it to realise the inherent value financial performance of your company is dependent gains from its properties, while the returns from the on the performance of Carson Cumberbatch PLC rental business will supplement this income and and PTAB which is also managed under the Carsons strengthen the asset base of the Group. Plantation sector. Therefore, in line with the Carsons Group’s performance, we expect Bukit Darah PLC too The leisure sector recorded a loss for the year. will continue to create value to shareholders over time. It is likely to be divested at a suitable valuation in future since it lacks the scale to be a key player in the industry.

Annual Report 2007/08 Bukit Darah PLC  Report of the Directors

The details set out herein provide the pertinent The principal activities of the subsidiaries and information required by the Companies Act No. 07 of associates are set out in Business Review section of 2007, Listing Rules of the Colombo Stock Exchange the Annual Report. and recommended best accounting practices. The Annual Report was approved by the Directors on There have been no significant changes in the nature 26th May 2008. of the activities of the Group and the Company during the financial year under review. General The Directors have pleasure in presenting to the Review of Operations and shareholders their report together with the Audited Future Developments Financial Statements for the year ended The Chairman’s Statements and Business Review 31st March 2008 of the Bukit Darah PLC., a public on pages 3 to 7 provide an overall assessment of limited liability company incorporated in Sri Lanka the business performance of the Group and its future in 1916. developments. These reports together with Audited Financial Statements reflect the state of affairs of the The Company was re-registered on 2nd August 2007 Company and the Group. as required under the provisions of the Companies Act No. 07 of 2007. The segment wise contribution to Group results, Assets and Liabilities are provided in Note 11 to the The name of the Company was changed from ‘The Financial Statements on pages 41 to 44. Bukit Darah Company PLC’ to ‘Bukit Darah PLC’ on the 12th October 2007 in accordance with Section 8 Financial Statements of the Companies Act No. 07 of 2007. The Financial Statements of the Group are prepared in conformity with Sri Lanka Accounting Standards Principal Activities (SLAS) and provide information required by the The principal activities of the Company consist of Companies Act No. 07 of 2007 and the Colombo investing in oil palm plantation and in diversified Stock Exchange Listing Requirements. The holding companies. Company and its subsidiaries are also guided by other recommended best accounting practices.

 Annual Report 2007/08 Bukit Darah PLC Report of the Directors

Financial Results The audited results of the Group and of the Company for the financial year ended 31st March 2008 are as follows:

Group Company For the year ended 31st March 2008 2007 2008 2007 Rs. ’000 Rs. ’000 Rs. ’000 Rs. ’000

Profit available for appropriation is 6,616,764 5,760,313 2,478,468 2,558,471 From which the following appropriations/distributions have been made: 8% participating cumulative preference shares: Annual Dividend - Rs. 0.14 per share (144) (144) (144) (144) Final Dividend - 2008 - Rs. 7.50 per share (2007 - Rs. 3.50 per share) (1,353) (631) (1,353) (631) Interim Dividend of (2007 - Rs. 35.50 per share) – (6,402) – (6,402)

(1,497) (7,177) (1,497) (7,177)

Ordinary Dividend Interim Ordinary Dividend (2007 - Rs. 4.50) – (45,000) – (45,000) Final Dividend - 2008 - Rs. 1.00 (2007 - Rs. 0.50) (10,000) (5,000) (10,000) (5,000)

(10,000) (50,000) (10,000) (50,000)

Transfers Short-term investment mark to market value adjustment reserve 26,697 (87,756) 13,079 (31,662) Investment property fair value adjustment – (345,769) – –

26,697 (433,525) 13,079 (31,662)

Leaving a balance to be carried forward of 6,631,964 5,269,611 2,480,050 2,469,632

Dividend Accounting Policies Subject to the approval of the shareholders at the The accounting policies adopted in the preparation of Annual General Meeting a first & final dividend the Financial Statements are given in Note 6. of Rs. 5.00 per ordinary share and Rs. 39.50 per participative cumulative preference share is There have been no changes in the Accounting recommended by the Directors for the year ended Policies adopted by the Group during the year 31st March 2008. The dividend payable has not under review. been accounted for until the same is approved at the forthcoming Annual General Meeting. Directors The Directors who have held office since the date of The details of the dividends paid during the year are the last report are as follows: set out in Note 18 to the Financial Statements. Hari Selvanathan Mano Selvanathan Taking into account the said distribution, the Israel Paulraj Directors are satisfied that the Company would meet D. Chandima R. Gunawardena the solvency test requirement under Section 56 (2) of Tilak de Zoysa the Companies Act No. 07 of 2007 immediately after P. Chandana P. Tissera the distribution. The Company’s Auditors, KPMG K.C. Nalake Fernando Ford, Rhodes, Thornton & Company have issued a N. Ramaiah (Alternate for Hari Selvanathan) Certificate of Solvency confirming the same.

Annual Report 2007/08 Bukit Darah PLC  Report of the Directors

Mr. Nataraj Ramaiah, resigned as an Alternate Director No. of Ordinary Shares As at 31st March 2008 2007 to Mr. H. Selvanathan on the 20th November 2007. Subsidiaries In accordance with Articles 82 & 83 of the Articles of Carson Cumberbatch PLC Association of the Company, Mr. T de Zoysa retire by Mr. H. Selvanathan 1,236 1,236 rotation at the forthcoming Annual General Meeting Mr. M. Selvanathan 900 900 Mr. P.C.P. Tissera 100 100 and being eligible, offers himself for re-election. Ceylon Guardian Investment Trust PLC Mr I. Paulraj who is over Seventy years of age to be Mr. I. Paulraj 50 50 re-elected as a Director of the Company for a further Mr. D.C.R. Gunawardena 50 50 period of one year from the conclusion of Annual Mr. P.C.P. Tissera 50 50 General Meeting and that the age limit stipulated in Section 210 of the Companies Act No. 07 of 2007 Ceylon Investment PLC Mr. I. Paulraj 50 50 shall not be applicable. Mr. D.C.R. Gunawardena 50 50 Mr. P.C.P. Tissera 50 50 Interest Register The interest register was introduced during the period Ceylon Brewery PLC under review as per the Companies Act No 07 of 2007. Mr. H. Selvanathan 690 690 Mr. M. Selvanathan 690 690 Directors’ Interests in Contracts and Shares Mr. D.C.R. Gunawardena 15 15 Directors’ interests in contracts of the Company are Mr. P.C.P. Tissera 15 15 disclosed in Note 47 to these Financial Statements Mr. S.K. Shah 2,632 2,632 and have been declared at meetings of the Directors. Lion Brewery (Ceylon) PLC The Directors have no direct or indirect interests in any Mr. H. Selvanathan 987 987 other contracts or proposed contracts in relation to the Mr. M. Selvanathan 987 987 business of the Company, while they had the following Mr. D.C.R. Gunawardena 22 22 interests in the ordinary shares of the Company: Mr. S.K. Shah 3,761 3,761 No. of Ordinary Shares As at 31st March 2008 2007 Shalimar (Malay) PLC Mr. H. Selvanathan 150 150 Company Mr. M. Selvanathan 150 150 Ordinary Mr. I. Paulraj 150 150 H. Selvanathan 14,800 14,800 Mr. D.C.R. Gunawardena 1 1 M. Selvanathan 4,004 4,004 I. Paulraj 100 100 Selinsing PLC D.C.R. Gunawardena 100 100 Mr. H. Selvanathan 648 648 T. de Zoysa – – Mr. M. Selvanathan 648 648 P. C. P. Tissera – – Mr. I. Paulraj 75 75 K.C.N. Fernando – – Mr. D.C.R. Gunawardena _ 31 N. Ramaiah (Alternate to H. Selvanathan) Good Hope PLC (Resigned w.e.f. 20/11/2007) – – Mr. H. Selvanathan 300 300 Preference - 8% Participating Mr. M. Selvanathan 300 300 H. Selvanathan 68,150 68,150 M. Selvanathan 74,162 74,162 Indo Malay PLC Mr. H. Selvanathan 2,192 2,192 Mr. M. Selvanathan 3,868 3,868 Mr. I. Paulraj 150 150 Mr. D.C.R. Gunawardena 100 100

10 Annual Report 2007/08 Bukit Darah PLC Report of the Directors

No. of Ordinary Shares Statement of Directors’ Responsibilities As at 31st March 2008 2007 The responsibilities of the Directors, in relation to the Equity One PLC Financial Statements, are detailed in the following Mr. D.C.R. Gunawardena 1,000 1,000 paragraphs, while the responsibilities of the Auditors are set out in the Report of the Auditors. Equity Two PLC Mr. I. Paulraj 51,000 51,000 Mr. D.C.R. Gunawardena 9,300 9,300 According to the Companies Act, No. 7 of 2007 and Mr. K.C.N. Fernando 3,600 3,600 the Sri Lanka Accounting and Auditing Standards Act, No. 15 of 1995, Directors are required to prepare Watapota Investments PLC Financial Statements for each financial year, giving Mr. I. Paulraj 200 200 a true and fair view of the state of affairs of the Mr. D.C.R. Gunawardena 25 25 Company and of the Group as at the end of the financial year and of the performance for the said Remuneration of Directors period. Since the end of the previous financial year, none of the Directors of the Company has received or In preparing these financial statements the Directors become entitled to receive any benefit (other than are required to ensure that: the benefits as disclosed in Note 13 to the Financial l appropriate Accounting Policies have been Statements) by reason of a contract made by the selected and applied consistently, while material Company or by a related corporation with a Director, departures, if any, have been disclosed and or with a firm of which the Director’s is a member, explained; or with a company in which the Director has a l all applicable Accounting Standards have been substantial financial interest except for any benefits complied with; and which may be deemed to have arisen by virtue of the l reasonable and prudent judgements and significant related party transactions as disclosed in estimates have been made. Note 47 to the Financial Statements. The Directors are responsible for ensuring that the Directors’ Meetings Attendance companies within the Group maintain sufficient Four Directors’ Meetings were convened during the accounting records to disclose with reasonable financial year and the attendance of the Directors is accuracy, the financial position of the Company as follows: and the Group, and for ensuring that the financial statements have been prepared and presented Director Meetings attended (out of 4) in accordance with the Sri Lanka Accounting and H. Selvanathan 3 Auditing Standards Act No. 15 of 1995, and meet M. Selvanathan 4 with the requirements of the Companies Act No. 7 of I. Paulraj 2 2007. They are also responsible for taking reasonable D.C.R. Gunawardena 4 measures to safeguard the assets of the Group and T. de Zoysa 2 in this regard to give proper consideration to the P. C.P. Tissera 3 establishment and effective operation of appropriate K.C.N. Fernando 3 systems of internal control with a view to prevent, N. Ramaiah (Alternate to H. Selvanathan) detect and rectify fraud and other irregularities. (Resigned w.e.f. 20/11/2007) –

Annual Report 2007/08 Bukit Darah PLC 11 Report of the Directors

These financial statements have been prepared on Remuneration Committee (Rule 6.5) a going concern basis, since the Directors are of Executive Directors are not compensated for their the view that the Group has adequate resources to role on the Board. The Non-Executive Members of continue in operation, for the foreseeable future from the Board receive a fee-based compensation. the date of signing these financial statements. Aggregate remuneration paid to the Non-Executive The Directors are also of the view that they have Directors are disclosed under Note 13 in page 45 of discharged their responsibilities as set out in this this Report. statement. The Board is in the process of formulating a Corporate Governance Remuneration Committee as per the CSE rules. Compliance of Corporate Governance Rules as per Section 6 of The Colombo Stock Exchange Audit Committee (Rule 6.6) (CSE) Listing Rules Audit Committee Members The Audit Committee of the Company comprises of Disclosures relating to Directors: Non-Executive and 3 members as follows. Independent Directors (Rule 6.3) Mr. Tilak de Zoysa - (Non-Executive Director) Directors Executive/Non-Executive/ Independent Mr. D. Chandima R Gunawardena - (Executive Mr. H. Selvanathan Executive Director) Mr. M. Selvanathan Executive Mr. Tennyson Rodrigo - (Non-Executive Director Mr. I. Paulraj Non Executive/Independent* - Good Hope PLC) Mr. D.C.R. Gunawardena Executive Mr. T. de Zoysa Non-Executive/Independent** The Board is currently working at reformulating the Mr. P.C.P. Tissera Executive Audit Committee structure to fall in line with the Mr. K.C.N. Fernando Executive Colombo Stock Exchange Rules. * The Board has determined that Mr. I. Paulraj is an independent Director in spite of being on the Board for The Report of the Audit Committee is given on more than 9 years and being a Director of many other companies within the Carson Cumberbatch Group page 16 of this report. which a majority of the other Directors of the Company are Directors, since he is not directly involved in the The Audit Committees appointed for the Group Management of the Company. The Management of Companies are as follows: the Company is carried out by Carsons Management Services (Private) Limited. Carson Cumberbatch PLC ** The Board has determined that Mr. T. de Zoysa is an Mr. Tilak de Zoysa (Chairman) - independent Director in spite of being on the Board of (Non-Executive Chairman - Carson Cumberbatch PLC in which a majority of other Carson Cumberbatch PLC) Directors of the Company are Directors, since he is not directly involved in the Management of the Company. Mr. Tennyson Rodrigo The Management of the Company is carried out by (Non-Executive Director - Good Hope PLC) Carsons Management Services (Private) Limited. Mr. D. Chandima .R. Gunawardena (Executive Director - Carson Cumberbatch PLC) A brief profile on each of the Directors of the Mr. V.P. Malalasekera Company and of the Group appears (Non-Executive Director - Carson Cumberbatch PLC) on page 122.

12 Annual Report 2007/08 Bukit Darah PLC Report of the Directors

Investment, Real Estate & Leisure Sectors As far as the Directors are aware, the Auditors do not Mr. Tilak de Zoysa (Chairman) have any other relationship with the Company other (Non-Executive Chairman - than that of an auditor of the Company. The Auditors Carson Cumberbatch PLC) also do not have any interest with the Company. Mr. Tennyson Rodrigo (Non-Executive Director - Good Hope PLC) Significant Events during the Financial Year Mr. D. Chandima R. Gunawardena - (a) Liquidation of Subsidiaries (Director - Carson Cumberbatch PLC) During the year, two wholly-owned subsidiaries of the Company, Nuwara Eliya (Holdings) PLC and Nuwara Plantation Sector Eliya Tea Estates Co. Ltd. which were dormant, were Mr. Tilak de Zoysa (Chairman) liquidated. The investment portfolios carried by the (Non-Executive Chairman - subsidiaries were transferred to the Company as Carson Cumberbatch PLC) liquidation proceeds. Mr. D.C.R. Gunawardena - (Director - Carson Cumberbatch PLC) (b) Incorporation of Subsidiary Mr. Subash Chandra Pandian Chelliah (i) Good Hope Asia Holding Ltd. a wholly-owned (Consultant, providing advisory services) subsidiary of the Company was incorporated in Singapore during the year. The results of Brewery Sector the subsidiary are included in the consolidated Mr. V.P. Malalasekera (Chairman) Financial Statements. (Non-Executive Director - Carson Cumberbatch PLC) (ii) Carson Real Estate Management Services Mr. Tilak de Zoysa (Non-Executive Chairman - (Private) Limited a wholly owned group subsidiary Carson Cumberbatch PLC) was incorporated during the year. The results Mr. Ralph de Lanerolle of the subsidiary is included in the consolidated (CEO - Property Development Ltd.) Financial Statements. Mr. D.C.R. Gunawardena (Director - Carson Cumberbatch PLC) Stated Capital There was no change in the stated capital of Auditors the Company during the year under review. The Company’s Auditors during the year under review total issued and fully paid up capital as at 31st were Messrs KPMG Ford, Rhodes, Thornton & March 2008 was Rs. 101,803,500/-, comprising Company. of 10,000,000 ordinary shares and 180,350, 8% participating cumulative preference shares. The retiring Auditors have expressed their willingness to continue in office. A resolution to reappoint them Shareholders’ Funds as Auditors and authorising the Directors to fix their Total Group shareholders’ funds as at 31st March remuneration will be proposed at the Annual General 2008, stood at Rs. 8,845 mn (2007 - Rs. 7,312 mn), Meeting. and total shareholders’ funds of the Company stood at Rs. 2,647 mn (2007 - 2,650 mn). Messrs KPMG Ford, Rhodes, Thornton & Company was paid Rs. 90,000/-. for the year ended 31st The movements are shown in the Statements March 2008 (2007- Rs. 83,000) as audit fees by the of Changes in Equity given on page 24 to the Company. In addition, they were paid Rs. 40,000/- by Annual Report. the Company as non-audit related services.

Annual Report 2007/08 Bukit Darah PLC 13 Report of the Directors

Capital Expenditure and Investments Human Resource Details of the Group capital expenditure undertaken The Group continued to invest in Human Capital during the year by each sector is: Development and implement effective Human Resource practices and policies to develop and (All figures in Sri Lankan Rs. ’000’s) 2008 2007 build an efficient and effective work force aligned

Investment Holdings around new business priorities and to ensure that its Associate companies – 2,261 employees are developing the skills and knowledge Long-term investment 2,496,359 595,435 required for the future success of the Group. Overseas Plantations Property, plant & equipment 2,830,171 1,270,123 The number of persons employed by the Group as at Intangible assets 23,531 77,353 31st March 2008 was 6,581 (2007 - Rs. 5,576). The Biological assets 1,249,540 1,454,548 Company had no employees as at 31st March 2008. Beverage Associate companies 425,302 319,541 (2007 - Nil). Property, plant & equipment 173,011 125,438 Intangible assets 9,701 15,510 Going Concern Real Estate Having taken into account the financial position and Property, plant & equipment 2,693 1,367 future prospect of the Company the Directors have Land held for development and sale & other 222,449 788,646 a reasonable expectation that the Company & its Hotels & Airlines subsidiaries have adequate resources to continue to Property, plant & equipment 5,848 22,979 be in operational existence for the foreseeable future. Intangible assets 3,791 For this reason the Company and its subsidiaries Management Services continue to adopt the going concern basis in preparing Property, plant & equipment 41,103 4,483 the Financial Statements. Intangible assets 4

5,919,660 6,241,527 Donations The Group made donations amounting to Rs. 8.5 mn Value of the Investment Portfolio during the year under review (2007 - Rs. 12.8 mn) The market value/valuation of the Group’s investment Company - Nil. portfolio as at 31st March 2008, was Rs. 10,037 mn (2007 - Rs. 10,728 mn). Events Occurring after the Balance Sheet date Market Value of Freehold Properties Subsequent to the Balance Sheet date, no circumstances arisen which required adjustments Certain freehold properties (land and buildings) of the to or disclosure in the Financial Statements, Group have been revalued based on independent other than those disclosed in Note 46 to the professional valuations, and written up in the books Financial Statements. of account to conform to market value of such properties. Further, details of such revaluations are given in Note 20 and 23 to the Financial Statements.

14 Annual Report 2007/08 Bukit Darah PLC Report of the Directors

Major Shareholders Twenty Major Shareholders - Ordinary Shares

As at 31st March 2008 2007 Name of the Shareholders No. of Shares % No. of Shares %

Rubber Investment Trust Limited 2,003,750 20.04 2,003,750 20.04 Portelet Ltd. 922,500 9.23 922,500 9.23 Skan Investments Ltd. 809,725 8.10 809,725 8.10 Good Hope Holdings Ltd. 775,225 7.75 771,125 7.71 Newgreens Ltd. 775,000 7.75 775,000 7.75 Carson Cumberbatch PLC. 730,025 7.30 730,025 7.30 Interkrish Investment Company Ltd. 715,590 7.16 715,525 7.16 Krish Investment Company Ltd. 715,585 7.16 715,525 7.16 Natwest Nominees Ltd. 412,375 4.12 412,375 4.12 Wardley Investments Ltd. 410,150 4.10 410,150 4.10 Gee Gees Properties (Pvt) Ltd. 366,100 3.66 366,100 3.66 S. Kanapathy Chetty Ltd. 208,300 2.08 208,300 2.08 Ceylon Finance & Securities Ltd. 98,601 0.99 98,601 0.99 Thurston Investments Ltd. 80,700 0.81 49,800 0.50 Pershing Llc S/A Averbach Grauson & Co. 75,000 0.75 – – J.B. Cocoshell (Pvt) Ltd. 69,500 0.70 – – Mr. E.A. Samaraweera 60,000 0.60 60,000 0.60 Mrs. H. Pope (Decd.) 60,000 0.60 60,000 0.60 Mr. W. Tippetts 51,000 0.51 51,000 0.51 Dr. R.H. Stoughton 40,000 0.40 40,000 0.40

Share Information Annual General Meeting Information relating to earnings, dividends, net The Annual General Meeting will be held on Monday, assets and market price per share is given on 30th June 2008 at 3.30 p.m. The Notice of Annual pages 112 & 133 of the Annual Report. Information General Meeting appears on page 136. on share trading is given on page 132 of the Annual Report. Signed on behalf of the Board,

Annual Report The Board of Directors approved the Company and (Sgd.) (Sgd.) the Consolidated Financial Statements together D.C.R. Gunawardena P.C.P. Tissera with the reviews which forms a part of the Annual Director Director Report on 26th May 2008. The appropriate number of copies of the report will be submitted to the Colombo 26th May 2008 Stock Exchange, Sri Lanka Accounting and Auditing Standard Monitoring Board and the Registrar of Companies within the given time frame.

Annual Report 2007/08 Bukit Darah PLC 15 Audit Committee Report

The Audit Committee of the Company comprises of integrity vis-à-vis objectives served and to determine three members as follows : the extent of adherence to the controls by staff responsible for the function and to take corrective/ Audit Committee members Executive/ preventive action where necessary. Non-Executive

Mr. Tilak de Zoysa (Chairman) Non-Executive The draft Financial Statements of the Company for Mr. D.C.R. Gunawardena Executive the year ended 31st March 2008 were reviewed by Mr. Tennyson Rodrigo – the Audit Committee members, together with the External Auditors, KPMG Ford, Rhodes, Thornton & Company, prior to release of same to the Regulatory The Board is currently looking at re-formulating the Authorities and to the shareholders. Audit Committee structure to fall in line with the Colombo Stock Exchange Listing Rules. The members of the Audit Committee have determined that KPMG Ford, Rhodes, Thornton & Mr. Tilak de Zoysa is the Non-Executive Chairman Company, Auditors, are independent on the basis of Carson Cumberbatch PLC and is the Deputy that they do not carry out any special assignment on Chairman/Managing Director of Associated the operations of the Company. Motorways Group of Companies. He is also a Director of Bukit Darah PLC. Mr. Chandima The Audit Committee has concurred to recommend Gunawardena is a Director of Carson Cumberbatch to the Board of Directors the re-appointment of PLC and in most of its’ Group Companies. Messrs. KPMG Ford, Rhodes, Thornton & Company Mr. Tennyson Rodrigo is a Director of Good as Auditors for the financial year ending 31st March Hope PLC. He was the former Managing Director 2009, subject to the approval of the shareholders at and Chief Executive of Capital Development and the Annual General Meeting. Investment Company PLC and former Chairman of the Audit Committee of Eagle Insurance PLC. The Board of Directors has established and adopted the Audit Committee Charter to be as follows : In accordance with the approved audit plan for 2007/08, the Group Internal Audit (GIA) carried out 3 Purpose detailed audits on the Investment sector companies. To assist the Board of Directors in fulfilling its oversight responsibilities for the financial reporting The findings and contents of the GIA reports process, the system of internal control over financial have been discussed with the management and reporting, the audit process and the Company’s subsequently the audit reports were circulated to the process for monitoring compliance with Company members of the Audit Committee and management. policies and procedures, laws and regulations and the code of conduct and the identification of and The objectives of the GIA work were to have an management of risks that would impact on the independent review of the system of internal controls Company’s business activities. as established by the management, its adequacy and

16 Annual Report 2007/08 Bukit Darah PLC Audit Committee Report

Authority Responsibilities The Audit Committee has authority to conduct or The Committee will carry out the following authorise investigations into any matters within the responsibilities : scope of responsibility. It is empowered to: Financial Statements:  Retain outside counsel, accountants or others to  Review significant accounting and financial advice the Committee or assist in the conduct of issues.

an investigation.  Review with management and the external  Seek any information it requires from employees- auditors the results of the audit (management all of whom are directed to co-operate with the letter contents) including any difficulties Committee’s request or external parties. encountered during audit.

 Meet with Company officers, external auditors or  Review the quarterly/annual Financial outside counsel, as necessary. Statements, prior to release of same to the Regulatory Authorities and to the shareholders.

Composition  Review with management and the external The Audit Committee will consist of at least three but auditors all matters required to be communicated no more than six members. The Board of Directors to the Committee under the generally accepted will appoint Committee members and the Chair. Auditing/Accounting Standards.

 Understand how management develops interim Meetings financial information and the nature and extent of The Committee will meet at least four times a year internal and external auditor involvement. and may convene further meetings as circumstances require. Two members will constitute the quorum Internal Control: for the time being and such members may meet in  Consider the effectiveness of the Company’s person or via tele or video conference. Decisions internal control over annual and interim financial may also be made by circulation of papers to the reporting, including information technology Audit Committee members and approvals granted security and control. by all the Audit Committee members shall have  Understand the scope of internal and external the same effect as a decision/approval given at a auditors’ review of internal control over financial Meeting of the Members. reporting and review significant findings and Ethical Conduct recommendations, together with management response. The members of the Committee are deemed to be citizens of high ethical conduct and they are expected to conduct affairs of the Committee adopting highest Internal Audit: ethical standards. The Members are also expected  Review with management and the Director not to divulge either directly or indirectly to any of Audit, the charter of the Internal audit person at any time, information acquired during the assignment/s, plans and activities. conduct of Audit Committee affairs.  Review the effectiveness of the internal audit function and its independency of function.

Annual Report 2007/08 Bukit Darah PLC 17 Audit Committee Report

External Audit:  Review any other reports the Company issues  Understand the external auditor’s proposed audit that are relevant and relating to Audit Committee and approach, including co-ordination of audit responsibilities. effort with internal audit.

 Review the performance of the external auditors Other Responsibilities: and recommend appointment, re-appointment or  Perform other activities related to this Charter as discharge of the auditors. requested by the Board of Directors.

 Review and confirm the independence of the  Institute and oversee special investigations as external auditors, on relationships between the needed. auditors and the Company, including non-audit  Review and assess the adequacy of the services proposed and carried out by the external Committee Charter once in every 3 years, if auditors. need be and request Board approval for  To meet with the external auditors to discuss any proposed changes. matter that the Committee or Auditors believe  Confirm annually that all responsibilities outlined needs to be discussed. The Audit Committee in this Charter have been carried out.

may invite the management if desired.  Meet periodically with management to review the Company’s identified risks and action taken by Compliance: the management to mitigate such risks.  Review the effectiveness of the system for monitoring compliance.

 Review regular compliance declarations (Sgd.) submitted by management and make Tilak de Zoysa independent observations. Chairman - Audit Committee Bukit Darah PLC Reporting Responsibilities:  Regularly report to the Board of Directors 26th May 2008 about Committee activities, issues and related recommendations.

 Provide an open avenue of communication between internal audit, the external audit and the Board of Directors.

 Report annually to the shareholders, describing the Committee’s composition, responsibilities and how they were discharged.

18 Annual Report 2007/08 Bukit Darah PLC Financial Reports

Independent Auditors Report 21 Income Statements 22 Balance Sheets 23 Statements of Changes in Equity 24 Cash Flow Statements 25 Notes to the Financial Statements 26 Five Year Summary 111 Statement of Value Added 113

US Dollar Financials Income Statement 116 Balance Sheet 117 Notes to the Financial Statements 118 Five Year Summary - Group 121 Group Quarterly Results

(Amounts expressed in Sri Lankan Rs. ’000)

1st Quarter % 2nd Quarter % 3rd Quarter % 4th Quarter % FY 2008 %

Revenue 3,487,763 22 3,315,437 21 3,511,162 23 5,269,394 34 15,583,756 100

Profit from operation 1,742,181 28 1,327,874 22 1,095,878 18 1,986,909 32 6,152,842 100 Finance cost (176,657) 21 (198,949) 24 (256,790) 31 (200,565) 24 (832,961) 100 Foreign exchange gain (losses) 13,785 (35) (27,958) 71 (110,858) 283 85,882 (219) (39,149) 100 Share of associate companies’ profits 7,367 20 3,195 9 6,984 19 18,074 51 35,620 100 Profit before taxation 1,586,676 30 1,104,162 21 735,214 14 1,890,300 35 5,316,352 100 Income tax expenses (271,744) 18 (414,196) 28 (254,866) 17 (502,065) 36 (1,442,871) 100 Profit for the period 1,314,932 34 689,966 18 480,348 12 1,388,235 36 3,873,481 100

Profit Attributable to: Equity holders of the parent 597,312 40 226,728 15 160,078 11 506,542 34 1,490,660 100 Minority shareholders 717,620 30 463,238 19 320,270 13 881,693 37 2,382,821 100 1,314,932 34 689,966 18 480,348 12 1,388,235 36 3,873,481 100

Earnings per share Rs. 59.73 22.67 16.00 49.94 148.34 Net assets per share Rs. 791.33 822.65 808.45 884.56 884.56 Marker value per share Rs. 1,050 970 1,300 1,400 1,400

Profit from operation segmental basis Investment holdings & Financial Services 478,395 255,805 1,121 347,590 1,082,911 Oil palm plantations 1,430,925 836,150 995,180 1,593,638 4,855,893 Beverages 74,057 83,433 116,343 110,635 384,468 Real estate 14,480 11,803 9,021 59,206 94,510 Hotels (4,793) (6,099) (3,444) (1,813) (16,149) Airlines 837 209 26 220 1,292 Management Services (3,536) 223,731 (2,245) 71,166 289,116 1,990,365 1,405,032 1,116,002 2,180,642 6,692,041 Intra-group transactions (248,184) (77,158) (20,124) (187,835) (533,301) 1,742,181 1,327,874 1,095,878 1,992,807 6,158,740

FINANCIAL CALANDER Announcement of Results 1st Quarter - 30th June 2007 24th August 2007 2nd Quarter - 30th September 2007 19th November 2007 3rd Quarter - 31st December 2007 25th February 2008 Financial year end - 31st March 2008 5th June 2008

Notice of Annual General Meeting 26th May 2008 92nd Annual General Meeting 30th June 2008

Dividend Declaration - 30th June 2008 *First & Final

*Subject to confirmation by Shareholders

20 Annual Report 2007/08 Bukit Darah PLC Independent Auditors Report

TO THE SHAREHOLDERS OF bukit darah PLC We have obtained all the information and explanations Report on the Financial Statements which to the best of our knowledge and belief were We have audited the accompanying financial statements necessary for the purposes of our audit. We therefore of Bukit Darah PLC, the consolidated financial believe that our audit provides a reasonable basis for statements of the Company and its subsidiaries as at our opinion. March 31, 2008 which comprise the balance sheet as at that date, and the income statement, statement of Opinion changes in equity and cash flow statement for the year In our opinion, so far as appears from our examination, then ended, and explanatory notes. the Company maintained proper accounting records for the year ended March 31, 2008 and the financial

Management’s Responsibility for the Financial statements give a true and fair view of the Company’s Statements state of affairs as at March 31, 2008 and its profit and Management is responsible for the preparation and fair cash flows for the year then ended in accordance with presentation of these financial statements in accordance Sri Lanka Accounting Standards. with Sri Lanka Accounting Standards. This responsibility includes: designing, implementing and maintaining In our opinion, the consolidated financial statements give internal control relevant to the preparation and fair a true and fair view of the state of affairs as at March 31, presentation of financial statements that are free from 2008 and the profit and cash flows for the year then ended, material misstatement, whether due to fraud or error; in accordance with Sri Lanka Accounting Standards, of the selecting and applying appropriate accounting policies; Company and its subsidiaries dealt with thereby, so far as and making accounting estimates that are reasonable in concerns the members of the Company. the circumstances. Report on Other Legal and Regulatory Scope of Audit and Basis of Opinion Requirements Our responsibility is to express an opinion on these These financial statements also comply with the financial statements based on our audit. We conducted requirements of Sections 153(2) to 153(7) of the our audit in accordance with Sri Lanka Auditing Standards. Companies Act No. 07 of 2007. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial KPMG Ford, Rhodes, Thornton & Co. statements. An audit also includes assessing the Chartered Accountants accounting principles used and significant estimates Colombo made by management, as well as evaluating the overall 26th May, 2008 financial statement presentation.

Annual Report 2007/08 Bukit Darah PLC 21 Income Statements

(Amounts expressed in Sri Lankan Rs. ’000) Group Company For the year ended 31st March 2008 2007 Change 2008 2007 Change Note % %

Revenue 11 15,583,756 9,620,950 62 41,828 122,142 (66) Direct operating expenses (4,848,143) 40 (81,062) (86) (6,765,383) (11,100) 4,772,807 85 41,080 (25) 8,818,373 30,728 Changes in fair value of biological assets 25 779,113 346,191 125 – – – Changes in fair value of investment properties 23 – 197,529 (100) – – – Gain/(loss) on mark to market valuation of short-term investments 30 (45,025) 154,241 (129) (13,079) 31,662 (141) Other income 12 27,089 76,512 (65) – – – Distribution expenses (1,521,808) (741,011) 105 – – – Administrative expenses (1,786,185) (1,322,721) 35 (6,181) (5,083) 22 Other operating expenses (117,374) 1 – – (118,715) – 13 3,366,174 83 67,659 (83) Profit from operations 6,152,842 11,468 Finance expenses 14 (832,961) (539,058) 55 – – – Foreign exchange gain/(loss) 15 (58,112) (33) 5,576 (100) (39,149) – Profit before net results of associate 5,280,732 2,769,004 91 11,468 73,235 (84)

Share of net results of associate 16 35,620 22,797 56 – – – Profit before taxation 11 5,316,352 2,791,801 90 11,468 73,235 (84) Income tax expenses Taxation - Current taxation (1,170,630) (367,765) 218 (2,632) (250) 953 - Deferred taxation (324,092) (16) – – (272,241) – 17 (691,857) 109 (250) 953 (1,442,871) (2,632) 11 2,099,944 84 72,985 (88) Profit for the year 3,873,481 8,836 Profit Attributable to Equity holders of the parent 11 1,490,660 811,641 84 8,836 72,985 (88) Minority shareholders 11 1,288,303 85 – – 2,382,821 – 2,099,944 84 72,985 (88) 3,873,481 8,836

Earnings per ordinary share (Rs.) 19 148.34 80.37 85 0.16 6.51 (100) Dividend per ordinary share* (Rs.) 18 5.00 5.50 (9) 5.00 5.50 (9)

Notes from pages 26 to 110 form an integral part of these Financial Statements.

* Based on proposed dividend.

Figures in brackets indicate deductions.

22 Annual Report 2007/08 Bukit Darah PLC Balance Sheets

(Amounts expressed in Sri Lankan Rs. ’000) Group Company As at 31st March Note 2008 2007 2008 2007

Assets Non-Current Assets Property, plant & equipment 20 13,794,454 11,825,786 – – Capital work in progress 21 907,243 1,867,803 – – Prepaid lease payment 22 309,416 317,910 – – Investment properties 23 1,370,947 1,370,779 – – Intangible assets 24 299,196 291,275 – – Biological assets 25 9,142,432 7,308,318 – – Investment in subsidiaries 26 – – 1,326,739 1,326,739 Investment in associates 26 394,185 350,117 36 36 Long-term investments 26 2,854,017 2,278,884 – – Advances pending capitalisation 29 – – 1,189,965 1,189,965 Deferred tax asset 17 243,180 107,674 – –

Total non-current assets 29,315,070 25,718,546 2,516,740 2,516,740

Current Assets Inventories 27 2,242,139 1,530,237 – – Trade and other receivables 28 2,097,622 1,287,247 405 45 Short-term investments 30 345,387 623,257 78,902 102,452 Short-term deposits 31 387,102 531,363 25,141 48,434 Cash in hand and at bank 31 1,678,451 639,422 53,230 6,695

Total current assets 6,750,701 4,611,526 157,678 157,626

Total assets 36,065,771 30,330,072 2,674,418 2,674,366

Equity Stated capital 32 101,804 101,804 101,804 101,804 Capital reserves 33 1,136,051 1,048,370 40,000 40,000 Revenue reserves 34 7,609,533 6,164,628 2,507,916 2,510,577

Total equity attributable to equity holders of the parent 8,847,388 7,314,802 2,649,720 2,652,381 Minority shareholders’ equity interest 12,412,246 10,256,725 – –

Total equity 21,259,634 17,571,527 2,649,720 2,652,381

Non-Current Liabilities Long-term borrowings 35 4,154,213 4,135,831 – – Trade and other payables 36 658,918 1,673,847 – – Retirement benefit obligations 37 103,599 76,548 – – Deferred tax liability 17 2,069,085 1,679,402 – –

Total non-current liabilities 6,985,815 7,565,628 – –

Current Liabilities Trade and other payables 36 2,355,432 1,951,023 21,989 21,032 Current tax liabilities 1,247,436 153,976 2,709 953 Long-term borrowings falling due within one year 35 1,249,581 831,888 – – Short-term borrowings 35 1,002,999 1,652,015 – – Bank overdraft 35 1,964,874 604,015 – –

Total current liabilities 7,820,322 5,192,917 24,698 21,985

Total liabilities 14,806,137 12,758,545 24,698 21,985

Total equity and liabilities 36,065,771 30,330,072 2,674,418 2,674,366

Net assets per ordinary share 884.56 731.30 264.79 265.06

I certify that these Financial Statements are in compliance with the requirements of Companies Act No. 7 of 2007.

(Sgd.) A.P. Weeratunge Chief Financial Officer The Board of Directors is responsible for the preparation and presentation of these Financial Statements. These Financial Statements were approved by the Board on 26th May 2008. Approved and signed on behalf of the Managers Approved and signed on behalf of the Board

(Sgd.) (Sgd.) (Sgd.) D.C.R. Gunawardena M. Selvanathan P.C.P. Tissera Director Director Director Carsons Management Services (Private) Limited Notes from pages 26 to 110 form an integral part of these Financial Statements.

Annual Report 2007/08 Bukit Darah PLC 23 Statements of Changes in Equity

(Amounts expressed in Sri Lankan Rs. ’000) Attributable to Equity holders of the Parent

Share Capital Capital Reserves Revenue Reserves Ordinary Share Preference Capital Revaluation Other General Retained Total Minority Total Capital Share Redemption Reserve Capital Reserve Earnings Shareholders’ Capital Reserve Reserve Interest

Group Balance as at 1st April 2006 100,000 1,804 40,000 34,851 705,947 200,881 4,816,956 5,900,439 8,830,784 14,731,223 Impairment of property, plant & equipment – – – (10,571) – – – (10,571) (17,480) (28,051) Effect of adopting revised SLAS 25 – – – – – – 326,682 326,682 – 326,682 Changes in equity – – – – 105,475 (118,010) (194,966) (207,501) 336,814 129,313 Exchange translation

differences – – – – 172,668 378,621 – 551,289 34,978 586,267 Gain/(loss) recognised directly in equity 100,000 1,804 40,000 24,280 984,090 461,492 4,948,672 6,560,338 9,185,096 15,745,434

Profit for the period – – – – – – 811,641 811,641 1,288,303 2,099,944 Total recognised Income 100,000 1,804 40,000 24,280 984,090 461,492 5,760,313 7,371,979 10,473,399 17,845,378 Transfer – – – – – 433,525 (433,525) – – –

Dividend paid – – – – – – (57,177) (57,177) (216,674) (273,851) Balance as 31st March 2007 100,000 1,804 40,000 24,280 984,090 895,017 5,269,611 7,314,802 10,256,725 17,571,527 Surplus on revaluation of property, plant & equipment – – – 33,459 – – 9,723 43,182 61,532 104,714 Changes in equity – – – – (36,407) 18,078 (153,230) (171,559) (339,194) (510,753) Exchange translation

differences – – – 90,629 – 91,171 – 181,800 284,136 465,936 Gain/(loss) recognised directly in equity 100,000 1,804 40,000 148,368 947,683 1,004,266 5,126,104 7,368,225 10,263,199 17,631,424 Profit for the period – – – – – – 1,490,660 1,490,660 2,382,821 3,873,481

Transfer – – – – – (26,697) 26,697 – – – Total recognised Income 100,000 1,804 40,000 148,368 947,683 977,569 6,643,461 8,858,885 12,646,020 21,504,905

Dividend paid – – – – – – (11,497) (11,497) (233,774) (245,271) Balance as at

31st March, 2008 100,000 1,804 40,000 148,368 947,683 977,569 6,631,964 8,847,388 12,412,246 21,259,634

Company Balance as at 1st April, 2006 100,000 1,804 40,000 – – 9,283 2,485,486 2,636,573 – 2,636,573 Profit for the period – – – – – – 72,985 72,985 – 72,985 Transfer – – – – – 31,662 (31,662) – – –

Dividend paid – – – – – – (57,177) (57,177) – (57,177) Balance as at 31st March, 2007 100,000 1,804 40,000 40,945 2,469,632 2,652,381 – 2,652,381 Profit for the period – – – – – – 8,836 8,836 – 8,836 Transfer – – – – – (13,079) 13,079 – – –

Dividend paid – – – – – – (11,497) (11,497) – (11,497) Balance as at

31st March, 2008 100,000 1,804 40,000 – – 27,866 2,480,050 2,649,720 – 2,649,720

In Accordance with Section 58 of Companies Act No. 7 of 2007, share capital has been re-classified as stated capital. The presentation of comparative information has been reclassified accordingly.

Notes from pages 26 to 110 form an integral part of these Financial Statements.

Figures in brackets indicate deductions.

24 Annual Report 2007/08 Bukit Darah PLC Cash Flow Statements

(Amounts expressed in Sri Lankan Rs. ’000) Group Company For the year ended 31st March 2008 2007 2008 2007

Cash Flows From Operating Activities Profit/(loss) before taxation 5,316,352 2,791,801 11,468 73,235 Adjustments for: Foreign exchange loss 39,149 58,112 – – Gain from changes in fair value of biological assets (779,113) (346,191) – – Fair value adjustment - in investment properties – (197,529) – – Mark to market value adjustment for short-term investment 45,025 (154,241) 13,079 (31,662) Share of net results of associates (35,620) (22,797) – – Depreciation 664,952 482,295 – – Amortisation of intangible assets/prepaid lease payment 26,677 18,082 – – Provision for retiring gratuity 34,362 20,266 – – Finance costs 832,961 539,058 – – Profit on disposal of property, plant & equipment (40,142) (23,599) – – Adjustment on capital work-in-progress 48,131 – – – Dividend from Associate Companies 6,468 4,356 – –

Operating cash flows before working capital changes 6,159,202 3,169,613 24,547 41,573 (Increase)/decrease in inventories (572,155) (938,904) – – (Increase)/decrease in trade and other receivables (810,375) (34,990) (360) 19,752 Increase/(decrease) in trade and other payables 403,963 145,920 511 8

5,180,635 2,341,639 24,698 61,333 Net cash flow from investments (394,063) (708,434) 10,470 5,713

Net cash generated from/(used in) operating activities 4,786,572 1,633,205 35,168 67,046

Finance costs paid (1,175,133) (575,429) – – Tax paid (78,304) (224,817) (880) (445) Retiring gratuity paid (6,695) (5,671) – –

Net cash inflow/(outflow) from operating activities 3,526,440 827,288 34,288 66,601

Cash Flows from Investing Activities Purchase of property, plant & equipment & biological assets (2,539,892) (4,413,259) – – Investment in Associate Companies – (2,261) – – Purchase of intangible assets/prepaid lease payment (30,325) (96,658) – – Purchase of investments – (205,871) – (638,851) (Increase)/decrease in amounts due from related companies – – – 661,432 Proceeds from disposal of investment property – 224,000 – – Proceeds from disposal of property, plant & equipment 69,366 28,492 – – Deposits received 24,484 58,194 – – Deposits refunded (4,269) (9,930) – –

Net cash generated from/(used in) investing activities (2,480,636) (4,417,293) – 22,581

Cash Flow from Financing Activities Proceeds from long-term loans 1,273,573 4,027,010 – – Repayment of loans (675,473) (1,683,455) – – Increase in long-term creditors (1,035,144) 162,762 – – Repayment of finance lease creditors (181,015) (158,324) – – Net decrease in minority shareholders’ interest (233,774) (216,674) – – Dividends paid (including preference dividends) (11,046) (55,636) (11,046) (55,636)

Net cash generated from/(used in) financing activities (862,879) 2,075,683 (11,046) (55,636)

Increase/(Decrease) in cash and cash equivalents 182,925 (1,514,322) 23,242 33,546 Cash and cash equivalents at the beginning of the year (1,085,245) 429,077 55,129 21,583

Cash and cash equivalents at the end of the year [Note 31(b)] (902,320) (1,085,245) 78,371 55,129

Notes from pages 26 to 110 form an integral part of these Financial Statements.

Figures in brackets indicate deductions.

Annual Report 2007/08 Bukit Darah PLC 25 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 2. basis of preparation 2.1 Statement of Compliance 1. Reporting entity The Financial Statements of the Company and the Bukit Darah PLC is a limited liability company which Group comprise the Balance Sheet, Statements is incorporated in Sri Lanka. The shares of the of Income, Changes in Equity and Cash Flows company have a primary listing on the Colombo together with the Accounting Policies and Notes Stock Exchange. to the Financial Statements. These statements are prepared in accordance with the Accounting The registered office and principal place of business Standards laid down by the Institute of Chartered of the company is located at No. 61, Janadhipathi Accountants of Sri Lanka and the requirements of Mawatha, Colombo 1. Companies Act No. 7 of 2007.

The Company and its subsidiaries, together referred The Financial Statements were authorised for issue to as the ‘Group’ is a diversified conglomerate by the Board of Directors in accordance with a and one of the foremost business establishments resolution of the Directors on 26th May 2008. in Sri Lanka. The businesses range from oil palm plantations in Malaysia and Indonesia, to breweries, 2.2 Basis of Measurement investment holdings, portfolio management, real The Financial Statements of the Company and estate and leisure in Sri Lanka. The Group has the Group have been prepared on a historical cost offices in Malaysia and Indonesia. convention except for the revaluation of certain property, plant & equipment, biological assets, Of the 36 Subsidiaries and 3 Associate Companies investment property & short-term investments which set out in Note 26 (a) & (b) (page 62) to the are stated at market values as disclosed in relevant Financial Statements, 14 are listed on the Colombo notes to the Financial Statements. Stock Exchange. The preparation of Financial Statements in Backed by a heritage of well over 100 years, today conformity with Sri Lanka Accounting Standards it is positioned as a company whose outlook is requires the use of certain critical accounting regional, focussed on a future which estimates. It also requires management to exercise is technology-oriented, results-driven and world- its judgment in the process of applying the class. Company’s Accounting Policies.

The Group had 6,581 (2007 - 5,576) employees at 3. Functional and presentation the end of the financial year. The Company did not Currency employ any staff as at the Balance Sheet date. All values presented in the Financial Statements are in Sri Lankan Rupees Thousand (Rs. ’000) The consolidated Financial Statements for the year unless otherwise indicated. ended 31st March, 2008 cover the Group and the Group’s interest in its associate companies. The individual Financial Statements of each entity in the Group are measured using the currency of The Financial Statements were authorised for issue the primary economic environment in which the by the Board of Directors in accordance with a entity operates (‘the functional currency’). The resolution of the Directors on 26th May, 2008. consolidated Financial Statements are presented in Sri Lankan Rupees, which is also the Company’s functional currency.

26 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

4. uSES of Estimates and Judgments transactions is contested by Revenue Authorities. The Group makes estimates and assumptions Any additional costs on account of these issues are concerning the future. Estimates and judgments are accounted for as a tax expense at the point liability continually evaluated and are based on historical is confirmed on any Group Company. experience and other factors, including expectations of future events that are believed to be reasonable (iv) Value of Unquoted Investments under the circumstances. The unquoted equity instruments have been valued based on the expected cash flows discounted at Actual results may differ from these estimates. current rates applicable for items with similar terms Estimates and underlying assumptions are reviewed and risk characteristics. This valuation requires the on an ongoing basis. Revisions to accounting Company to make estimates about expected future estimates are recognised in the period in which cash flows and discount rates, and hence they are these estimates are revised and in any future periods subject to uncertainty. affected. The critical estimates and assumptions made during the year are discussed below. (v) Defined Benefit Plans The cost of defined benefit pension plans is (i) Biological Assets determined using actuarial valuations. The actuarial The Group carries its palm oil plantations at fair valuation involves making assumptions about value less estimated point-of-sale costs, which discount rates, future salary increases, mortality requires extensive use of accounting estimates. rates and future pension increases. Due to the Significant components of fair value measurement long-term nature of these plans, such estimates are were determined using assumptions including subject to uncertainty. average lives of plantations, period of being immature and mature, yield per hectare and (vi) Deferred Tax Assets discount rates utilised in the computation of future Deferred tax assets are recognised for all unused cash flows. The amount of changes in fair values tax losses to the extent that it is probable that would differ if the company utilised different taxable profit will be available against which the assumptions. Any changes in fair values of these losses can be utilised. Management judgment plantations would affect the group’s statements of is required to determine the amount of deferred income and equity. tax assets that can be recognised, based upon the likely timing and level of future taxable profits (ii) Estimated Impairment of Goodwill together with future tax planning strategies. The Group determines whether goodwill is impaired at least on an annual basis. This requires an estimation Judgments of the value in use amount and requires management (vii) Owner Occupied Properties and to make an estimate of the expected future cash flows Investment Property from the Cash Generating Units (CGU). In determining if a property qualifies as Investment Property the Company makes a judgment whether (iii) Income Taxes the property generates independent cash flows Income tax liabilities arise to the Group in various rather than cash flows that are attributable not only jurisdictions. These liabilities are provided for in to the property but also other assets. Judgment is the Financial Statements applying the relevant tax also applied in determining if ancillary services are statutes and regulations which the management significant, so that a property does not qualify as believes reflect actual liability. There can be investment property. instances where the stand taken by the Group on

Annual Report 2007/08 Bukit Darah PLC 27 Notes to the Financial Statements

5. materiality and aggregation necessary to align with the policies adopted by the Each material class of similar items is presented Group, except for those disclosed in Note 25. aggregated in the Financial Statements. Items of dissimilar nature or function are presented The purchase method of accounting is used to separately unless they are immaterial. account for the acquisition of subsidiaries by the Group. The cost of an acquisition is measured as 6. Significant Accounting Policies the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the The Accounting Policies which have been applied date of exchange, plus costs directly attributable by the Company and the Group are consistent to the acquisition. Identifiable assets acquired with those of the previous year and the previous and liabilities & contingent liabilities assumed in a year’s figures and phrases have been rearranged business combination are measured initially at their wherever necessary to conform to the current fair values at the acquisition date, irrespective of the year’s presentation. extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group’s The Financial Statements of overseas subsidiaries share of the identifiable net assets acquired is are prepared in conformity with Accounting recorded as goodwill. If the cost of acquisition is Standards applicable in the respective countries of less than the fair value of the net assets of the incorporation. subsidiary acquired, the resulting negative goodwill is recognised directly in the Income Statement. The consolidated Financial Statements have been prepared using uniform accounting policies for like transactions/events in similar circumstances (ii) Associates and where necessary, appropriate adjustments Associates are those enterprises in which the have been made in the consolidated Financial Group has significant influence but not control, over Statements except for those disclosed in Note 25. the financial and operational policies. Investments in associates are accounted for using the equity

All companies in the Group other than the method of accounting and are initially recognised at companies disclosed in Note 42 (page 85) to these cost. The Group’s investment in associate includes Financial Statements, have a common financial goodwill (net of any accumulated impairment loss) year which ends on 31st March. identified on acquisition.

6.1 Basis of Consolidation The Group’s share of its associates’ post- (i) Subsidiaries acquisition profits or losses is recognised in the income statement, and its share of post-acquisition Subsidiaries are all entities over which the movements in reserves is recognised in reserves. Group has the power to govern the financial and The cumulative post-acquisition movements are operating policies generally accompanying a adjusted against the carrying amount of investment. shareholding of more than one half of the voting When the Group’s share of losses in an associate rights. The existence and effect of potential voting equals or exceeds its interest in the associate, rights that are currently exercisable or convertible including any other unsecured receivables, the are considered when assessing whether the Group does not recognise further losses, unless Group controls another entity. Subsidiaries are it has incurred obligations or made payments on consolidated from the date that control commences behalf of the associates. until the date that control ceases. The accounting policies of subsidiaries have been changed when

28 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

Accounting Policies of associates have been differences arising on monetary items that form part changed where necessary to ensure consistency of the Group’s net investment in foreign operations, with the policies adopted by the Group. where that monetary item is denominated in a currency other than the functional currency of (iii) Transactions Eliminated on either the reporting entity or the foreign operations, Consolidation are recognised in profit or loss for the period. Inter-company transactions, balances and Exchange differences arising on monetary items unrealised gains on transactions between Group that form part of the Company’s net investment in Companies are eliminated. Unrealised gains foreign operations, regardless of the currency of the arising from transactions with Group Companies monetary item, are recognised in profit or loss in the are eliminated against the investment to the extent Company’s Financial Statements or’ the individual of the Group’s interest in the investee. Unrealised Financial Statements of the foreign operations, as losses are also eliminated in the same way as appropriate. unrealised gains, but only to the extent there is no evidence of impairment. Exchange differences arising on the translation of non-monetary items carried at fair value are 6.2 Foreign Currencies included in profit or loss for the period except (i) Foreign Currency Transactions for the differences arising on the translation of In preparing the Financial Statements of the non-monetary items in respect of which gains and individual entities, transactions in currencies losses are recognised directly in equity. Exchange other than the entity’s functional currency (foreign differences arising from such non-monetary items currencies) are recorded in the functional currencies are also recognised directly in equity. using the exchange rates prevailing at the dates of the transactions. At each Balance Sheet date, (ii) Foreign Operations monetary items denominated in foreign currencies The results and financial position of foreign are translated at the rates prevailing on the Balance operations that have a functional currency different Sheet date. from the presentation currency (LKR) of the consolidated Financial Statements are translated Exchange differences arising on the settlement of into LKR as follows: monetary items, and on the translation of monetary items, are included in profit or loss for the period l Assets and liabilities for each balance sheet except for exchange differences arising in relation presented are translated at the closing rate to the development of palm oil plantation and prevailing at the Balance Sheet date. on monetary items that form part of the Group’s l Income and expenses for each income net investment in foreign operations. Exchange statement are translated at average exchange differences incurred in relation to the development rates for the year, which approximates the of palm oil plantation are capitalised to the related exchange rates at the dates of the transactions; qualifying asset. Exchange differences arising and on monetary items that form part of the Group’s l The exchange differences arising on the net investment in foreign operations, where translation are taken directly to a separate that monetary item is denominated in either the component of equity. On disposal of foreign functional currency of the reporting entity or the entity, the deferred cumulative amount foreign operations, are initially taken directly to the recognised in equity relating to that particular foreign currency translation reserve within equity foreign operation is recognised in the income until the disposal of the foreign operations, at which statement. time they are recognised in profit or loss. Exchange

Annual Report 2007/08 Bukit Darah PLC 29 Notes to the Financial Statements

l Goodwill and fair value adjustments arising on (ii) Deferred Taxation the acquisition of a foreign entity are treated as Deferred Taxation is provided based on the assets and liabilities of the foreign entity and liability method on temporary differences between translated at the closing rate. the carrying amounts of assets and liabilities for l The exchange rates applicable during the period financial reporting purposes and the amounts used were as follows: for taxation purposes. The balance in the deferred Balance Income Sheet Statement taxation account represents, the tax applicable to Closing rate Average Rate the difference between the written down values 2008 2007 2008 2007 Rs. Rs. Rs. Rs. of the assets for tax purposes on which tax

Malaysian Ringgit 33.85 31.56 32.85 31.66 depreciation has been claimed and the net book US Dollar 107.85 108.90 110.35 105.58 values of such assets, offset by the provision for Indonesian Rupiah (Rp) 0.0117 0.0119 0.0120 0.0115 retirement benefit which is deductible for current tax Singapore Dollar 78.195 – 77.64 – purposes only on payment.

6.3 Income Tax Expense Deferred tax assets are recognised for all Income tax expenses comprise current and deductible temporary differences and carry forward deferred tax. Income tax expenses are recognised of unused tax losses, to the extent that it is probable in the Income Statement except to the extent that that future taxable profit will be available against it relates to the items recognised directly in equity, which the deductible temporary differences and in which case it is recognised in Statement of carry forward of unused tax losses can be utilised. Changes in Equity.

The carrying amount of deferred tax assets is (i) Current Taxation reviewed at each Balance Sheet date and reduced Current tax assets and liabilities for the current and to the extent that it is no longer probable that prior periods are measured at the amount expected sufficient taxable profit will be available to allow all to be recovered from or paid to Revenue Authority. or part of the deferred tax assets to be utilised. The tax rates and tax laws used to compute the amount are those that are enacted or substantively Capital Assets and Bases of their Valuation enacted by the balance sheet date. Assets classified as current assets in the Balance Sheet are cash and those which are expected to The provision for current tax on Sri Lankan realise in cash, during the normal operating cycle operations is based on the elements of income and of the Company’s business, or within one year expenditure as reported in the Financial Statements from the Balance Sheet date, whichever is shorter. and computed in accordance with the provisions of Assets other than current assets are those which the Inland Revenue Act. the Company intends to hold beyond a period of one year from the Balance Sheet date. Current tax has been provided on overseas operations in accordance with the relevant statutes in force in the countries in which operations are carried out.

The relevant details are disclosed in respective notes to the Financial Statements.

30 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

6.4 Property, Plant & Equipment and in the revaluation surplus in respect of an asset, Depreciation is transferred directly to accumulated profits on (a) Basis of Recognition retirement or disposal of the asset. All items of property, plant & equipment are initially recorded at cost. Where items of property, plant & (c) Restoration Costs equipment are subsequently revalued, the entire Expenditure incurred on repairs or maintenance class of such assets is revalued. Revaluations are of Property, plant & equipment in order to restore made with sufficient regularity to ensure that their or maintain the future economic benefits expected carrying amounts do not differ materially from their from originally assessed standard of performance, fair values at the balance sheet date. Subsequent is recognised as an expense when incurred. to the initial recognition as an asset at cost, revalued property, plant & equipment are carried at (d) Depreciation revalued amounts less accumulated depreciation The provision for depreciation is calculated by using thereon and accumulated impairment losses. The a straight-line method on the cost or valuation of Company applies revaluation model to freehold all Property, plant & equipment other than freehold properties and cost model to the remaining assets land, in order to write off such amounts over the under property, plant & equipment which are stated following estimated useful lives: at historical cost less accumulated depreciation less Number of years accumulated impairment losses Land improvements 30 (b) Revaluation of Freehold Properties Buildings - Leased 20 The freehold properties of the Group are carried - Freehold 20 at revalued amounts. Revaluation of these assets Plant & machinery 10 - 12.5 are carried out at least once in five (5) years in Motor vehicles 4 - 5 order to ensure the book value reflect the realisable Furniture, fittings & office equipment 5 - 10 value of such assets, and are depreciated over the Computers 3 - 5 remaining useful lives of such assets, wherever Mature plantations 30 applicable. Depreciation of an asset begins when it is available When an asset is revalued, any increase in the for use whereas depreciation of an asset ceases carrying amount is credited directly to a revaluation at the earlier of the date that the asset is classified surplus unless it reverses a previous revaluation as held for sale and the date that the asset is decrease relating to the same asset, which was derecognised. previously recognised as an expense. In these circumstances the increase is recognised as Land improvement costs are depreciated in the income to the extent of the previous write down. year the area planted becomes mature and ready When an asset’s carrying amount is decreased as for harvest. a result of a revaluation, the decrease is recognised as an expense unless it reverses a previous The Group reviews and evaluates the carrying increment relating to that asset, in which case it is value of Property, plant and equipment charged against any related revaluation surplus, for impairment when events or changes in to the extent that the decrease does not exceed circumstances indicate that the related carrying the amount held in the revaluation surplus in amount is not recoverable. Impairment loss is respect of that same asset. Any balance remaining measured as the amount by which the asset’s carrying value exceeds its recoverable amount.

Annual Report 2007/08 Bukit Darah PLC 31 Notes to the Financial Statements

6.5 Capital Work-in-Progress the Group, the asset is depreciated over the shorter Capital work-in-progress represents the accumulated of the lease term and its useful life. cost of materials and other costs directly related to the construction of an asset. Capital in progress is (b) Operating Lease transferred to the respective asset accounts at the Lease of assets under which all the risks and time it is substantially completed and ready for its benefits of ownership are retained by the lessor intended use. are classified as operating leases. Payments made under operating leases are charged to the income 6.6 Leases statement on a straight-line basis over the period of (a) Finance Lease the lease. Leases of property plant & equipment where the Group assumes substantially all the benefits and 6.7 Project Expenditure in respect of pre- risks of ownership are classified as finance leases. operational activities are capitalised with the respective assets.

Assets held under finance lease are capitalised at the cash price as part of property, plant & 6.8 Plantations equipment and depreciated over the shorter of (i) Permanent Land Development Costs the estimated useful lives of the assets or the Land development costs incurred in respect of lease term. developing the land for cultivation which are permanent in nature, are capitalised. Upon initial recognitions assets acquired by way of finance leases are stated at an amount equal (ii) Limited Life Land Development Cost to the lower of their fair values and the estimated Limited life land development costs incurred in present value of the minimum lease payments at respect of new planting, replanting, inter-planting the date of inception less accumulated depreciation and crop diversifying including infilling cost of the oil and impairment losses. In calculating the present palm plantation are capitalised in accordance with value of the minimum lease payments, the discount the Sri Lanka Accounting Standard 32 - ‘Plantation’. rate is the interest rate implicit in the lease, if this The limited life land development costs are is practicable to determine; if not ,the group’s amortised over the estimated productive lives, at incremental borrowing rate is used. the commencement of commercial harvest, which has the following characteristics: Each lease payment is allocated between the liability and finance charges so as to achieve a Time lag between planting and constant rate on the finance balance outstanding. commercial harvest - 3-4 years The corresponding rental obligations and net of Duration of commercial harvest - 30 years finance charges are included in borrowings. The interest element of the finance charge is charged to 6.9 Investment Property the income statement over the lease period. Investment properties are measured initially at cost, including transaction costs. The carrying amount Property, plant and equipment acquired under includes the cost of replacing part of an existing finance lease contracts are depreciated over the investment property at the time that cost is incurred useful life of the asset. If there is no reasonable if the recognition criteria are met; and excludes certainty that the ownership will be transferred to

32 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

the costs of day-to-day servicing of an investment Group completes the construction or development property. Subsequent to initial recognition, of a self- constructed investment property, any investment properties are stated at fair value, which difference between the fair value of the property reflects market conditions at the balance sheet at that date and its previous carrying amount is date. Formal valuation are carried out every 3 years recognised in the Income Statement. by qualified valuers. Gains or losses arising from changes in the fair values of investment properties 6.10 Intangible Assets are included in the income statement in the year in (i) Basis of Recognition which they arise. Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible Investment properties are derecognised when either assets acquired in a business combination is the they have been disposed of or when the investment fair value as at the date of acquisition. Following property is permanently withdrawn from use and the initial recognition of the intangible assets, the no future economic benefit is expected from its cost model is applied requiring the assets to be disposal. Any gains or losses on the retirement or carried at cost less any accumulated amortisation disposal of an investment property are recognised and accumulated impairment losses. Internally in the Income Statement in the year of retirement or generated intangible assets, excluding capitalised disposal. development costs are not capitalised and expenditure is reflected in the Income Statement in Transfers are made to investment property when, the year in which the expenditure is incurred. and only when, there is a change in use, evidenced by the end of owner occupation, commencement of The useful lives of intangible assets are assessed an operating lease to another party or completion to be either finite or indefinite. of construction or development. Transfers are made from investment property when, and Intangible assets with finite lives are amortised only when, there is a change in use, evidenced over the useful economic life and assessed by commencement of owner occupation or for impairment whenever there is an indication commencement of development with a view to sale. that the intangible asset may be impaired. The amortisation period and the amortisation method For a transfer from investment property to owner for an intangible asset with a finite useful life occupied property or inventories, the deemed cost is reviewed at least at each financial year end. of property for subsequent accounting is its fair Changes in the expected useful life or the expected value at the date of change in use. If the property pattern of consumption of future economic benefits occupied by the Group as an owner occupied embodied in the asset is accounted for by changing property becomes an investment property, the the amortisation period or method, as appropriate, Group accounts for such property in accordance and treated as changes in accounting estimates. with the policy stated under property, plant & The amortisation expense on intangible assets with equipment up to the date of change in use. For a finite lives is recognised in the income statement in transfer from inventories to investment property, the expense category consistent with the function/ any difference between the fair value of the property nature of the intangible asset. Amortisation was at that date and its previous carrying amount is commenced when the assets were available for use. recognised in the income statement. When the

Annual Report 2007/08 Bukit Darah PLC 33 Notes to the Financial Statements

(ii) Amortisations 6.11 Biological Assets The useful lives and the amortisation methods of Biological assets represent the palm oil plantations intangible assets with finite lives are as follows: of the Subsidiaries incorporated in Indonesia are

The Class of Estimated Amortisation stated at fair values less estimated point-of-sale Intangible Assets Useful lives Method costs in accordance with IAS 41 - ‘Agriculture’. Oil Computer Software 3-10 years Straight-line palm trees have an average life upto 26 years, with method the first 30 months as immature and the remaining Land Rights 30 years Straight-line method years as mature. As market determined prices or values are not readily available for plantations in its Intangible assets with indefinite useful lives are present condition, the Company uses the present tested for impairment annually either individually or value of expected net future cash flows (excluding at the cash generating unit level. Such intangibles any future cash flows for financing the assets, are not amortised. The useful life of an intangible taxation, or re-establishing plantations after harvest) asset with an indefinite life is reviewed annually from the asset, discounted at a current market to determine whether indefinite life assessment determined pre-tax rate in determining fair values. continues to be supportable. If not, the change in the useful life assessment from indefinite to finite is Gains or losses arising on initial recognition of made on a prospective basis. plantations at fair value less estimated point-of- sale costs and from the change in fair value less Intangible assets that are not yet available for sale estimated point-of-sale costs of plantations at each are tested for impairments at each financial year reporting date are included in the Statement of end, even if there is no indication that the asset is Income for the period in which they arise. impaired. 6.12 Investments Gains or losses arising from derecognition of an (i) Classification intangible asset are measured as the difference Investments in subsidiaries and associates of the between the net disposal proceeds and the carrying Company are treated as long-term investments and amount of the asset, and are recognised in the stated at cost. Other investments which are held Income Statement when the asset is derecognised. for yield or capital appreciation are also classified as long-term investments. Investments that are (iii) Goodwill intended to be held for trading purposes are Goodwill arising on acquisition represents the classified as short-term investments. excess of the cost of acquisition over the Group’s interest in the net fair value of the acquires (ii) Cost indentifiable assets, liabilities, contingent liabilities Cost of investments is the cost of acquisition at the date of acquisition. Upon transition to revised including brokerage, commission and other fees. Sri Lanka Accounting Standard 25 ‘Business Combinations’, goodwill is no longer amortised. (iii) Valuation - Quoted Investments Instead goodwill is tested for impairment annually Quoted investments that are held for long-term are and assessed for any indication of impairment carried in the Balance Sheet at lower of cost and at each reporting date to ensure that its carrying market value on an aggregate portfolio basis and amount does not exceed its recoverable amount. If quoted investments that are held for short-term are an impairment loss is identified, it will be recognised carried in the Balance Sheet at market value. immediately in the Income Statement.

34 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(iv) Unquoted - Unquoted Investments 6.13 Inventories All unquoted investments are carried at lower of Inventories are recognised at cost and net cost and Directors’ valuation, if any. Provision is realisable value whichever is lower after making made for any permanent diminution in value. due allowance for obsolete and slow moving items, except for fresh fruit bunches which are valued at (v) Impairment in Carrying Value since realised values. Impairment in carrying value of investments are deemed to be permanent where the Investee The cost of inventories are determined on a Company and/or weighted average basis except for food items and cutlery & crockery which are ascertained

l Auditors have qualified their opinion on the on a first-in-first-out basis. going concern status, and/or. l Operations have resulted in net losses and The costs are derived on the following bases: these losses are expected to continue, and/or Raw Material and Containers - cost of purchase l Where the core business has become non- together with any incidental expenses. viable due to environmental and/or other Work-in-Progress - raw material cost and a concerns, and/or proportion of manufacturing expenses. l Where the industry/sector has an uncertain Finished Goods - raw material cost and outlook due to environmental and/or other manufacturing expenses in full. concerns. Land held for Development and Sales - Cost and

development costs including borrowings costs up to (vi) Market Value of the Investment point of completion for revenue recognition. Portfolio Linen Stock - in the year of purchase at cost of The market value of the investment portfolio is purchase and in the second year in use at 25% of based on the following: the cost of purchase. (a) Marketable equity securities are stated at the values published in the Official Valuation 6.14 Trade and Other Receivables List of the Colombo Stock Exchange. Where Trade and other receivables are stated at the the Official Valuation is not available, the amounts estimated to realise. Where necessary, market value is stated at the last transacted provision is made for bad and doubtful debts. price.

(b) Units purchased from Unit Trusts are valued 6.15 Cash & Cash Equivalents at the manager’s buying price as at the Cash & cash equivalents are defined as cash in Balance Sheet date. hand, and bank demand deposits and short-term

(c) Unquoted investments are stated at cost highly liquid investments readily convertible to unless otherwise stated. known amounts of cash and subject to insignificant risk of changes in value.

(vii) Mark to Market Value Adjustment For the purpose of the Cash Flow Statement, cash This represent the difference between carrying value & cash equivalents comprise of cash in hand, and of the short-term investment portfolio and market bank deposits held in banks and investments in value of the same as at the Balance Sheet date. The money market instruments, net of short-term loans difference is recognised in the Income Statement. and bank overdraft.

Annual Report 2007/08 Bukit Darah PLC 35 Notes to the Financial Statements

6.16 Impairment of Non-Financial Assets which goodwill has been allocated, an impairment loss The group assesses assets or groups of assets is recognised. Impairment losses relating to goodwill for impairment at each reporting date or whenever cannot be reversed in future periods. events or changes in circumstances indicate that the carrying value of assets may not be (ii) Associates recoverable. If any such indication of impairment After application of the equity method, the Company exists, the group makes an estimate of its determines whether it is necessary to recognise recoverable amount. Individual assets are grouped an additional impairment loss of the Company’s for impairment purposes at the lowest level at which investment in its Associates. The Company there are identifiable cash flows that are largely determines at each Balance Sheet date whether independent of the cash flows of other groups of there is any objective evidence that the investment assets. Where the carrying amount of an asset in Associate is impaired. If this is the case the group exceeds its recoverable amount, the asset Company calculates the amount of impairment as group is considered impaired and is written down to being the difference between the fair value of the its recoverable amount. Associate and the acquisition cost and recognises the amount in the Income Statement. A previously recognised impairment loss is reversed only if there has been a change in the estimates 6.17 Impairment of Financial Assets used to determine the asset’s recoverable amount The Group assesses at each balance sheet date since the last impairment loss was recognised. If whether a financial asset or group of financial that is the case, the carrying amount of the asset is assets is impaired. increased to its recoverable amount. That increased amount cannot exceed the carrying amount that Assets Carried at Amortised Cost would have been determined; net of depreciation If there is objective evidence that an impairment charge is adjusted in future periods to allocate the loss on assets carried at amortised cost has been asset’s revised carrying amount, less any residual incurred, the amount of the loss is measured as value, on a systematic basis over its remaining the difference between the asset’s carrying amount useful life. and the present value of estimated future cash flows (excluding future expected credit losses The following criteria are also applied in assessing that have not been incurred) discounted at the impairment of specific assets: financial asset’s original effective interest rate (i.e. the effective interest rate computed at initial (i) Goodwill recognition). The carrying amount of the asset is Goodwill is reviewed for impairment, annually reduced through use of an allowance account. or more frequently if events or changes in The amount of the loss shall be recognised in circumstances indicate that the carrying value may profit or loss. be impaired. If, in a subsequent period, the amount of the

Impairment is determined for goodwill by assessing impairment loss decreases and the decrease can the recoverable amount of the cash-generating unit be related objectively to an event occurring after (or group of cash-generating units), to which the the impairment was recognised, the previously goodwill relates. Where the recoverable amount of recognised impairment loss is reversed, to the the cash-generating unit (or group of cash-generating extent that the carrying value of the asset does units) is less than the carrying amount of the cash- not exceed its amortised cost at the reversal date. generating unit (group of cash-generating units) to Any subsequent reversal of an impairment loss is recognised in profit or loss.

36 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

In relation to trade receivables, a provision for A contingent liability is disclosed where the impairment is made when there is objective existence of an obligation will only be confirmed by evidence (such as the probability of insolvency or future events or where the amount of the obligation significant financial difficulties of the debtor) that cannot be measured with reasonable reliability. the Company will not be able to collect all of the Contingent assets are not recognised, but are amounts due under the original terms of the invoice. disclosed where an inflow of economic benefits is The carrying amount of the receivable is reduced probable. through use of an allowance account. Impaired debts are derecognised when they are assessed as 6.20 Environment Expenditures and uncollectible. Liabilities Environment expenditures that relate to current LIABILITIES AND PROVISIONS or future revenues are expensed or capitalised 6.18 Liabilities as appropriate. Expenditures that relate to an existing condition caused by past operations and Liabilities classified as current liabilities in the do not contribute to current or future earnings are Balance Sheet are those obligations payable on expensed. demand or within one (1) year from the Balance Sheet date. Items classified as non-current liabilities Liabilities for environment costs are recognised are those obligations which expire beyond a period when environmental assessments or clean-ups are of one (1) year from the Balance Sheet date. probable and the associated costs can be reliably

6.19 Provisions and Contingencies estimated. Generally, the timing of recognition of these provisions coincides with the commitment to Provisions are recognised when the group has a formal plan of action or, if earlier, on divestment a present obligation (legal or constructive) as a or on closure of inactive sites. result of a past event ,it is probable that an outflow of resources embodying economic benefits will The amount recognised is the best estimate of be required to settle the obligation and a reliable the expenditure required. Where the liability will estimate can be made of the amount of the not be settled for a number of years, the amount obligation. Where appropriate, the future cash recognised is the present value of the estimated flow estimates are adjusted to reflect risks specific future expenditure. to the liability. Where the group expects some or all of a provision to be reimbursed, for example, 6.21 Retirement Benefit Obligations under an insurance contract, the reimbursement (Gratuity) is recognised as a separate asset, but only when (i) Defined Benefit Plan - Gratuity the reimbursement is virtually certain. The expense (a) Local relating to any provision is presented in the income All local companies are liable to pay retirement statement net of any reimbursement. benefits under the Payment of Gratuity Act, No. 12 of 1983. If the effect of the time value of money is material, provisions are determined by discounting the Gratuity provision for employees are made using expected future cash flows at a pre-tax rate that the assumption of an actuarial valuation as at reflects current market assessments of the time 31st March 2007, carried out by a firm of value of money. Where discounting is used, the independent professional valuers. As recommended increase in the provision due to the passage of time by the Sri Lanka Accounting Standard No. 16, the is recognised as other finance expense. “Projected Unit Credit” (PUC) method has been used in this valuation.

Annual Report 2007/08 Bukit Darah PLC 37 Notes to the Financial Statements

Such actuarial valuations will be carried out once in are initially recognised at fair value on the date on every two (2) years. which a derivative contract is entered into and are subsequently re-measured at fair value. Derivatives The principal actuarial assumptions are: are carried as assets when the fair value is positive l Rate of discount 11% p.a. and as liabilities when the fair value is negative. l Rate of pay increase 10% p.a. l Retirement age to be 55 years. The Group’s forward contract do not qualify for l The Company and its subsidiaries will continue hedge accounting. All gains or losses arising from in business as Going Concerns. changes in fair value of this derivative contracts during the years ended 31st March 2008 and 2007 The liability is not externally funded. are taken directly to the income statements.

(b) Overseas 6.24 Stated Capital Provisions are made in the Financial Statements Ordinary shares and preference shares are in accordance with the respective legislative classified as equity and incremental costs directly enactments in force, if any, in the countries of attributable to the issue of new shares or options operation. are shown in equity as a deduction, net of tax, from the proceeds. (i) Defined Contribution Plans - Employees’ Provident Fund and Employees’ Trust Fund 6.25 Income Statement All employees who are eligible for Provident Fund (i) Revenue contributions and Trust Fund contributions are The Group revenue represents sales to customers covered by relevant contribution funds in line with outside the Group and sales within the Group which the respective statutes. Employer’s contributions to are intended for internal consumption. the defined contribution plans are recognised as an expense in the Income Statement when incurred. 6.26 Revenue Recognition Revenue is recognised to the extent that it is 6.22 Interest-Bearing Loans and probable that the economic benefits will flow to Borrowings the Group, and the revenue and associated costs Interest-bearing bank loans are recorded at the incurred or to be incurred can be reliably measured. amount of proceeds received, net of transaction costs. Revenue is measured at the fair value of the consideration received or receivable, net of trade Borrowing costs directly attributable to the discounts and sales taxes, and after eliminating acquisition and construction of development sales within the Group. The following specific criteria properties and property, plant and equipment are are used for the purpose of recognition of revenue: capitalised as part of the cost of those assets, until

such time as the assets are ready for their intended Sale of Goods and Services use or sale. All other borrowing costs are charged Revenue from sale are recognised upon delivery of to the income statement as an expense in the products and customer acceptance, if any, whereby period in which they are incurred. significant risks and rewards of ownership are passed on to the buyer, or upon performance of 6.23 Derivative Financial Instruments services. The Group enters into forward sales contracts to hedge its risks associated with fluctuations of palm oil prices. Such derivative financial instruments

38 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

Dividend Income - when the shareholders’ right to (ii) Finance Costs receive dividend is established. Interest expenses are recognised on an accrual basis. Sale of Fresh Fruit Bunches - upon delivery and acceptance by customers. (iii) Borrowing Costs All borrowing costs are recognised as an Rental and Interest Income - on a time proportion expense in the period in which they are incurred basis. except those that are directly attributable to the construction or development of property, plant & Proceeds on Sales of Shares - on accrual basis. equipment/biological assets which are capitalised as a part of the cost of that asset during the period Sale of Residential Units of construction or development. Revenue is recognised on percentage completion basis. Revenue recognition is commenced when 6.28 Segmental Information properties are sold and/or the buyers have taken Segmental information is presented for identifiable possession of such properties and up to the operative units of the Group classified according maximum of percentage completed or cash paid to two segment formats, namely, industry and by the buyer whichever is lower. For this purpose, geographical segments. the property is deemed to be sold once 30% of the outright sales price has been received or substantial (i) Industry Segment work has completed. For this purpose, 30% of the The activities of the Group have been broadly work is completed its deemed that substantial work classified into seven segments according to the has completed. nature of product or service rendered.

Other Income - on accrual basis. (ii) Geographical Segment The activities of the Group have been broadly Net gains and losses of a revenue nature resulting classified into four segments, namely, operations from the disposal of property, plant & equipment within Sri Lanka, Malaysia, Indonesia and United have been accounted for in the Income Statement. Kingdom based on geographical spread of operations. Profits or losses on disposal of investments are accounted for in the Income Statement on the basis Segmental expenses are, expenses that are directly of realised net profit. attributed to a segment or a relevant portion of

expenses that can be allocated on a reasonable 6.27 Expenditure Recognition basis as determined by the Management. (i) Operating Expenses

All expenses incurred in day-to-day operations 6.29 Related Party Transactions of the business and in maintaining the property, Disclosure has been made in respect of the plant & equipment in a state of efficiency has been transactions in which one party has the ability to charged to revenue in arriving at the profit or loss control or exercise significant influence over the for the year. Provision has also been made for financial and operating policies/decisions of the bad and doubtful debts, all known liabilities and other, irrespective of whether a price being charged. depreciation on property, plant & equipment.

Annual Report 2007/08 Bukit Darah PLC 39 Notes to the Financial Statements

7. CASH FLOW 9. FUTURE CHANGES IN ACCOUNTING Interest paid, interest received and dividend POLICIES received are classified as operating cash flows, Standards Issued but not yet Effective: while dividend paid is classified as financing cash Sri Lanka Accounting Standard 16 (Revised) - flows for the purpose of presentation of Cash Flow Employee Benefits Statement which has been prepared using the A revised SLAS 16 was issued in 2007, and “Indirect Method”. becomes effective for financial years beginning on or after 1st July 2007. Accordingly, the Financial

8. SIGNIFICANT ACCOUNTING POLICIES THAT Statements for year ending 31 March 2009 (or 31st ARE SPECIFIC TO THE BUSINESS OF December 2008, if a December y/e) will adopt the ASSOCIATE COMPANIES revised SLAS 16. Union Assurance PLC 8.1 General Insurance Business - As a result of the revision all short-term employee Gross Written Premium benefits of the Company will be required to be Gross written premium is generally recognised recognised when an employee has rendered as written upon inception of the policy. Upon service in exchange for those benefits. For post- inception of the contract, premiums are recorded employment benefits, the Company will be required as written and are earned primarily on a pro-rata to involve a qualified actuary in their measurement. basis over the term of the related policy coverage. Pending a full study of this revised standard, the However, for those contracts for which the period financial impact is not yet known with reasonable of risk differs significantly from the contract period, certainty. premiums are earned over the period of risk in proportion to the amount of insurance protection 10. Directors’ responsibility provided. Earned premiums are computed on the The Board of Directors is responsible for the 24th basis except for marine business, which is preparation and presentation of the Financial computed on a 60-40 basis. Statements.

8.2 Life Insurance Business - This is more fully described under the relevant Gross Written Premium clause in the Directors’ Report. Premiums from traditional life insurance contracts, including participating contracts and non participating contracts, are recognised as revenue when cash is received from the policy holders.

40 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 11. Revenue Group Company For the year ended 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Revenue Analysis (i) Gross revenue 16,694,450 10,503,471 41,828 122,142 Less: Taxes to the Government of Sri Lanka (Value added tax) (882,521) – (1,110,694) – Net Revenue 9,620,950 122,142 15,583,756 41,828

Goods and Services Analysis 7,881,440 – Sale of goods 14,258,629 – Services Investment income 1,802,598 1,905,366 41,828 122,142 Property rental income 93,658 94,526 – – Commission, management services & royalty fees 907,430 185,095 – – Hospitality services 119,611 – 163,873 – 2,304,598 122,142 2,967,559 41,828 Net revenue before intra-group transactions 17,226,188 10,186,038 41,828 122,142 Intra-group transactions (565,088) – (1,642,432) – Net revenue 9,620,950 122,142 15,583,756 41,828

A detailed analysis of Group Revenue highlighting the contribution from different segments is given under ‘Segmental Information’ in Notes 11 (a) & (b) (page 44) to the Financial Statements.

(ii) Segmental Information The Group’s primary format segment reporting is industry segments and the secondary format is geographical segments. The risks and returns of the Group’s operations are primarily determined by the nature of the different activities that the Group engages in, rather than the geographical location of these operations. This is reflected by the Group’s organisational structure. Industry segment activities of the Group have been broadly classified into seven segments: Investment Holdings & Financial Services, Oil Palm Plantations, Beverage, Real-Estate, Hotels, Airlines, Management services according to the nature of product or service rendered.

Sales between segments are made at prices that approximate market prices. Segment revenue, segment expense and segment result include transactions between industry segments. These transactions and any unrealised profits and losses are eliminated on consolidation. Segmental expenses are expenses that are directly attributed to a relevant segment or a portion of expenses that can be allocated on a reasonable basis as determined by the Management.

The Group’s geographical segments are based on the location of the Group’s assets and spread of operations. The activities of the Group have been broadly classified into four geographical segments, namely, operations within Sri Lanka, Malaysia, Indonesia and United Kingdom. Sales to external customers are based on the location of the seller.

Annual Report 2007/08 Bukit Darah PLC 41 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

11. Revenue (Contd.) Segmental Information (Contd.) (a) By Industry Segment Revenue Profit from Operations Finance Expenses Profit before Taxation Income Taxation Expenses Profit for the year For the year ended 31st March 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007

Investment Holdings & Financial Services 2,438,139 2,438,070 1,082,911 1,469,707 350,880 222,380 767,653 1,275,700 36,397 31,847 731,256 1,243,853 Oil Palm Plantations 9,032,017 3,908,296 4,855,893 1,925,859 249,476 246,243 4,567,268 1,615,930 1,323,501 548,874 3,243,767 1,067,056 Beverage 5,226,613 3,973,233 384,468 142,013 229,964 62,487 154,502 79,526 (24,339) 65,643 178,841 13,883 Real Estate 136,722 97,767 94,510 253,478 9,614 1,839 84,896 251,636 15,337 44,624 69,559 207,012 Hotels 163,873 119,611 (16,149) (30,477) 15,142 12,098 (31,290) (42,574) – – (31,290) (42,574) Airlines 7,760 11,367 1,292 3,640 73 233 1,218 3,406 306 383 912 3,023 Management Services 124,619 (16,763) 17,980 (34,743) 486 (35,229) 845,576 289,116 3,503 285,615 91,669 193,946 17,850,700 10,672,963 6,692,041 3,747,457 858,652 563,260 5,829,862 3,148,881 1,442,871 691,857 4,386,991 2,457,024 Intra-group transactions (1,642,432) (565,088) (539,199) (381,283) (25,691) (24,202) (513,510) (357,080) – – (513,510) (357,080) Share of associate companies’ revenue (486,925) – – – – – (624,512) – – – – – 9,620,950 3,366,174 539,058 2,791,801 691,857 2,099,944 15,583,756 6,152,842 832,961 5,316,352 1,442,871 3,873,481

Investment Holdings & Financial Services Oil Palm Plantations Beverage Real Estate Hotels Airlines Management Services Group As at 31st March 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007

Segment Assets Property, plant & equipment/ biological assets/intangible assets/ investment properties 241,307 244,214 20,543,166 17,743,598 2,331,889 2,283,536 1,965,938 1,974,611 667,611 680,236 477 540 73,300 55,136 25,823,688 22,981,871 Long-term investments 2,496,359 2,302,460 – – 744,843 319,541 7,000 7,000 – – – – – – 3,248,202 2,629,001 Deferred assets – – 239,921 107,674 – – – – – – – – 3,260 – 243,181 107,674 Current assets 1,002,923 1,292,217 1,268,434 979,090 30,604 4,707 33,551 4,611,526 740,817 2,926,579 ` 1,814,869 1,063,189 40,679 3,133 161,435 6,750,701 3,549,597 19,143,489 3,871,511 2,960,701 710,840 5,247 88,687 30,330,072 Total segmental assets 3,478,483 23,709,666 ` 4,891,601 3,036,127 708,290 3,610 237,995 ` 36,065,771

Segment Liabilities Interest bearing borrowings 50,781 325,281 3,458,343 2,963,658 16,194 78,369 565,102 695,675 63,793 72,848 – – – – 4,154,213 4,135,831 Long-term creditors – – 198,415 1,233,559 436,736 415,285 23,767 25,003 – – – – – – 658,918 1,673,847 Deferred tax liabilities – – 1,494,799 1,104,520 416,274 417,353 157,974 157,438 – – – – 37 91 2,069,084 1,679,402 Retirement benefit obligations – – 54,070 38,626 19,506 21,730 3,690 3,643 2,902 1,979 450 21 22,981 10,549 103,599 76,548 Current liabilities 1,469,187 2,625,797 969,289 70,154 38,349 2,050 18,091 5,192,917 1,944,267 3,532,307 ` 1,920,582 180,841 49,610 1,161 191,557 7,820,322 1,794,468 7,966,160 1,902,026 951,913 113,176 2,071 28,731 12,758,545 Total segmental liabilities 1,995,048 8,737,934 ` 2,809,292 931,374 116,305 1,611 214,575 ` 14,806,137

Other Information Total cost incurred during the period to acquire Property, plant & equipment – – 1,270,123 2,830,171 173,011 125,438 2,693 1,367 5,835 22,979 13 35 41,102 4,483 1,492,777 2,984,473 Intangible assets/prepaid lease payment – 161,483 23,531 77,353 9,701 15,510 – – – 3,791 – – – 4 33,232 258,141 Biological assets/investment property – – 1,249,539 1,454,548 – – – – – – – – – – 1,249,539 1,454,548 Depreciation for the year (property plant/intangible assets) – – 490,588 320,876 126,407 117,394 9,343 9,250 15,439 17,149 68 199 23,107 17,427 664,952 482,295 Salaries and wages 4,795 4,175 810,969 597,262 195,085 211,786 13,587 10,955 35,858 33,734 3,190 3,354 300,475 94,638 1,363,959 955,904 Gratuity – – 16,904 11,011 1,502 4,446 579 752 1,436 10 428 96 13,513 3,951 34,362 20,266

42 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

11. Revenue (Contd.) Segmental Information (Contd.) (a) By Industry Segment Revenue Profit from Operations Finance Expenses Profit before Taxation Income Taxation Expenses Profit for the year For the year ended 31st March 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007

Investment Holdings & Financial Services 2,438,139 2,438,070 1,082,911 1,469,707 350,880 222,380 767,653 1,275,700 36,397 31,847 731,256 1,243,853 Oil Palm Plantations 9,032,017 3,908,296 4,855,893 1,925,859 249,476 246,243 4,567,268 1,615,930 1,323,501 548,874 3,243,767 1,067,056 Beverage 5,226,613 3,973,233 384,468 142,013 229,964 62,487 154,502 79,526 (24,339) 65,643 178,841 13,883 Real Estate 136,722 97,767 94,510 253,478 9,614 1,839 84,896 251,636 15,337 44,624 69,559 207,012 Hotels 163,873 119,611 (16,149) (30,477) 15,142 12,098 (31,290) (42,574) – – (31,290) (42,574) Airlines 7,760 11,367 1,292 3,640 73 233 1,218 3,406 306 383 912 3,023 Management Services 124,619 (16,763) 17,980 (34,743) 486 (35,229) 845,576 289,116 3,503 285,615 91,669 193,946 17,850,700 10,672,963 6,692,041 3,747,457 858,652 563,260 5,829,862 3,148,881 1,442,871 691,857 4,386,991 2,457,024 Intra-group transactions (1,642,432) (565,088) (539,199) (381,283) (25,691) (24,202) (513,510) (357,080) – – (513,510) (357,080) Share of associate companies’ revenue (486,925) – – – – – (624,512) – – – – – 9,620,950 3,366,174 539,058 2,791,801 691,857 2,099,944 15,583,756 6,152,842 832,961 5,316,352 1,442,871 3,873,481

Investment Holdings & Financial Services Oil Palm Plantations Beverage Real Estate Hotels Airlines Management Services Group As at 31st March 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007

Segment Assets Property, plant & equipment/ biological assets/intangible assets/ investment properties 241,307 244,214 20,543,166 17,743,598 2,331,889 2,283,536 1,965,938 1,974,611 667,611 680,236 477 540 73,300 55,136 25,823,688 22,981,871 Long-term investments 2,496,359 2,302,460 – – 744,843 319,541 7,000 7,000 – – – – – – 3,248,202 2,629,001 Deferred assets – – 239,921 107,674 – – – – – – – – 3,260 – 243,181 107,674 Current assets 1,002,923 1,292,217 1,268,434 979,090 30,604 4,707 33,551 4,611,526 740,817 2,926,579 ` 1,814,869 1,063,189 40,679 3,133 161,435 6,750,701 3,549,597 19,143,489 3,871,511 2,960,701 710,840 5,247 88,687 30,330,072 Total segmental assets 3,478,483 23,709,666 ` 4,891,601 3,036,127 708,290 3,610 237,995 ` 36,065,771

Segment Liabilities Interest bearing borrowings 50,781 325,281 3,458,343 2,963,658 16,194 78,369 565,102 695,675 63,793 72,848 – – – – 4,154,213 4,135,831 Long-term creditors – – 198,415 1,233,559 436,736 415,285 23,767 25,003 – – – – – – 658,918 1,673,847 Deferred tax liabilities – – 1,494,799 1,104,520 416,274 417,353 157,974 157,438 – – – – 37 91 2,069,084 1,679,402 Retirement benefit obligations – – 54,070 38,626 19,506 21,730 3,690 3,643 2,902 1,979 450 21 22,981 10,549 103,599 76,548 Current liabilities 1,469,187 2,625,797 969,289 70,154 38,349 2,050 18,091 5,192,917 1,944,267 3,532,307 ` 1,920,582 180,841 49,610 1,161 191,557 7,820,322 1,794,468 7,966,160 1,902,026 951,913 113,176 2,071 28,731 12,758,545 Total segmental liabilities 1,995,048 8,737,934 ` 2,809,292 931,374 116,305 1,611 214,575 ` 14,806,137

Other Information Total cost incurred during the period to acquire Property, plant & equipment – – 1,270,123 2,830,171 173,011 125,438 2,693 1,367 5,835 22,979 13 35 41,102 4,483 1,492,777 2,984,473 Intangible assets/prepaid lease payment – 161,483 23,531 77,353 9,701 15,510 – – – 3,791 – – – 4 33,232 258,141 Biological assets/investment property – – 1,249,539 1,454,548 – – – – – – – – – – 1,249,539 1,454,548 Depreciation for the year (property plant/intangible assets) – – 490,588 320,876 126,407 117,394 9,343 9,250 15,439 17,149 68 199 23,107 17,427 664,952 482,295 Salaries and wages 4,795 4,175 810,969 597,262 195,085 211,786 13,587 10,955 35,858 33,734 3,190 3,354 300,475 94,638 1,363,959 955,904 Gratuity – – 16,904 11,011 1,502 4,446 579 752 1,436 10 428 96 13,513 3,951 34,362 20,266

Annual Report 2007/08 Bukit Darah PLC 43 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

11. REVENUE (Contd.) Segmental Information (Contd.) (b) By Geographical Location Sri Lanka Malaysia Indonesia Singapore United Kingdom Group For the year ended 31st March 2008 2007 2008 2007 2008 2007 2008 2007 2007 2008 2007

Revenue 6,415,863 5,672,774 643,379 246,131 8,524,514 3,700,182 – – 1,863 15,583,756 9,620,950

Profit from operations 892,120 1,397,984 594,931 122,438 4,666,068 1,846,771 (277) – (1,019) 6,152,842 3,366,174 Finance cost (583,485) (292,815) – (32) (249,476) (246,211) – – – (832,961) (539,058) Foreign exchange loss – 5,576 – – (39,149) (63,688) – – – (39,149) (58,112) Share of net result of Associate 35,620 22,797 – – – – – – – 35,620 22,797

Profit before taxation 344,255 1,133,542 594,931 122,406 4,377,443 1,536,872 (277) – (1,019) 5,316,352 2,791,801 Income tax expenses (28,778) (149,809) (139,108) (24,702) (1,274,985) (517,346) – – – (1,442,871) (691,857)

Net profit after taxation 315,477 983,733 455,823 97,704 3,102,458 1,019,526 (277) – (1,019) 3,873,481 2,099,944

Segment Assets Property, plant & equipment/ biological assets/ intangible assets/ investment property 5,250,180 5,238,272 4,672,436 4,277,814 15,901,070 13,465,785 – – – 25,823,688 22,981,871 Long-term investments 2,503,359 2,309,367 – – – – 744,843 319,541 93 3,248,202 2,629,001 Deferred tax assets – – 119 12,262 243,062 95,412 – – – 243,181 107,674 Current assets 3,500,295 3,292,348 458,475 96,044 2,791,931 1,203,778 – – 19,356 6,750,701 4,611,526

Total segmental assets 11,253,834 10,839,987 5,131,030 4,386,120 18,936,065 14,764,975 744,843 319,541 19,449 36,065,771 30,330,072

Segment Liabilities Interest bearing borrowings 695,870 1,172,173 – – 3,458,343 2,963,658 – – – 4,154,213 4,135,831 Long-term creditors 460,503 440,288 – – 198,415 1,233,559 – – – 658,918 1,673,847 Deferred tax liabilities 574,287 574,880 278,189 69,857 1,216,608 1,034,665 – – – 2,069,084 1,679,402 Retirement benefit obligations 38,989 37,920 11,569 3,948 53,041 34,680 – – – 103,599 76,548 Current liabilities 4,110,406 2,553,513 690,064 28,294 3,019,855 2,611,068 – – 42 7,820,322 5,192,917

Total segmental liabilities 5,880,055 4,778,774 979,822 102,099 7,946,260 7,877,630 – – 42 14,806,137 12,758,545

Other Information Total cost incurred during the period to acquire Property, plant & equipment 186,487 154,302 20,762 37,149 1,285,528 2,793,022 – – – 1,492,777 2,984,473 Intangible assets 9,701 180,788 – – 23,531 77,353 – – – 33,232 258,141 Biological assets/ – – – – 1,249,539 1,454,548 – – – 1,249,539 1,454,548 Depreciation for the year: Property, plant & equipment 168,888 161,419 10,654 5,891 485,410 314,985 – – – 664,952 482,295 Salaries and wages 366,560 358,554 54,974 35,383 942,425 561,967 – – – 1,363,959 955,904 Gratuity 6,919 9,255 1,914 1,155 25,530 9,856 – – – 34,363 20,266

44 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 12. Other Income Group Company For the year ended 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Interest income 32,651 25,585 – – Profit on disposal of fixed assets: Property sector – 22,047 – – Beverage sector 14 (915) – – Plantation sector 36,376 – – – Management Services sector 3,750 2,475 – – Airlines sector (8) – 2 – 23,599 – 40,142 – Foreign exchange gain/(loss) (60,375) 7,829 – – Sundry income 19,499 – 14,671 – 76,512 – 27,089 –

13. Profit from Operations Profit from operations is stated after charging/(crediting) all expenses/(income) including the following:

Group Company For the year ended 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Auditors’ remuneration and other professional services expenses [Note 13 9a)] 22,391 19,221 120 83 Professional services [Note 13 (b)] 18,272 7,109 – – Audit committee fees 1,000 1,303 – – Depreciation of property, plant & equipment [Note 13 (c)] 664,952 482,295 – – Amortisation of intangible assets/ prepaid lease payments 26,677 18,082 – – Profit on disposal of long-term investment 61,360 392,591 – – Profit/(loss) on disposal of short-term investment (12,783) 65,442 (1,079) 20,976 Donations 8,525 12,775 – – Royalty 82,520 53,498 – – Impairment loss on long-term investment 2,000 – – – Research & development costs 5,890 7,145 – – Directors’ fees 6,695 4,750 30 45 Bad Debts – 94 – – Legal fees 2,907 932 – – Personnel cost [Note 13 (d)] 976,170 45 1,398,321 30

Annual Report 2007/08 Bukit Darah PLC 45 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) Group Company For the year ended 31st March 31st March 31st March 31st March 2008 2007 2008 2007

(a) Auditors’ Remuneration and Other Professional Services Expenses Auditors’ remuneration Fees payable to KPMG Ford, Rhodes, Thornton & Company for the audit of annual accounts of Bukit Darah PLC 90 83 90 83 Fees payable to KPMG Ford, Rhodes, Thornton & Company for the audit of subsidiaries of Bukit Darah PLC 3,840 2,365 – – Fees payable to other auditors for the

audit of subsidiaries Bukit Darah PLC 9,495 8,316 – – Total statutory audit fees 10,764 83 13,425 90

Fees payable to Auditors for Other Services

Tax Services Compliance services - Non-KPMG, Sri Lanka 1,172 – 1,191 – 1,172 – 1,191 –

Other Services Internal audit - (Non-KPMG, Sri Lanka) 5,534 6,364 Others - KPMG 1,910 649 40 –

- Non-KPMG 331 272 – – 7,285 – 7,775 40 Total services costs 8,457 – 8,966 40 Total remuneration 19,221 83 22,391 130

(b) Professional Services Legal services 2,907 932 – – Plantation consultant services 9,301 6,037 – – Valuation services 3,338 – – – Other services 140 – 2,726 – 7,109 – 18,272 –

(c) Depreciation Included in the Income Statement under the following headings: Direct operational expenses 458,624 352,082 – – Administration 136,438 91,335 – – Distribution 61,986 31,578 – – Other operating expenses 7,300 – 7,904 – 482,295 – 664,952 –

46 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) Group Company For the year ended 31st March 31st March 31st March 31st March 2008 2007 2008 2007

(d) Personnel Expenses Salaries, wages and other related expenses 1,319,624 925,931 30 45 Defined contribution plan expenses - EPF & ETF 44,335 29,973 – – Defined benefit plan expenses - gratuity 20,266 – 34,362 – 976,170 45 1,398,321 30 The above include:

Directors’ emoluments 52,910 45 57,890 30

2008 2007 Year end Average Year end Average

(e) Group The detail of employees during the year was: Employees by Industry Investment Holdings 4 4 5 5 Overseas Plantations 6,074 5,581 5,087 4,033 Beverage 185 182 178 175 Real Estate 10 14 16 17 Hotels 226 224 222 227 Airlines 8 8 9 10 Management Services 59 57 74 66 5,576 4,524 6,581 6,079 Employees by Geographical Location Sri Lanka 507 498 489 489 Malaysia 138 138 136 136 Indonesia 4,951 3,899 5,936 5,443 5,576 4,524 6,581 6,079

There are no employees in Bukit Darah PLC.

Annual Report 2007/08 Bukit Darah PLC 47 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 14. Finance expenses Group Company For the year ended 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Interest expense Long-term borrowings* 660,299 377,735 – – Short-term borrowings 197,694 – 514,834 – 1,175,133 575,429 – – Less: Amount capitalised as Land held for development and sale (139,747) (10,609) – – Biological Assets (25,762) – (202,425) – 539,058 – 832,961 – *This includes the finance leases interest 33,657 25,447

15. Foreign Exchange (gain)/LOSSES Group Bukit Darah PLC – 5,576 – 5,576 PT Agro Indomas (19,618) (45,464) – – PT Agro Bukit (18,224) – (19,531) – (58,112) 5,576 (39,149) –

As at 31st March 2008, the Company’s foreign Subsidiary, PT Agro Indomas recorded a foreign exchange loss of Rs. 19.61 mn (Rp 5,625 mn) [2007 - loss of Rs. 45.46 mn (Rp 2,338 mn)] and PT Agro Bukit recorded a foreign exchange loss of Rs. 19.53 mn (Rp 1,623 mn) [2007 - loss of Rs. 18.22 mn (Rp 1576 mn)] arising from revaluing the US Dollar denominated long-term borrowings. Accordingly, this foreign exchange loss has been recognised in the Income Statements.

16. Share of net results of Associate Associate Companies’ Group’s Share of Profit Revenue Profit after Tax after Tax For the year ended 31st March 31st March 31st March 31st March 31st March 31st March 2008 2007 2008 2007 2008 2007

ACW Insurance (Pvt.) Ltd. – – 740 368 172 85 The Unit Trust Management Company (Private) Limited 33,135 38,441 13,850 9,850 1,414 1,001 Union Assurance PLC 3,582,615 155,583 21,711 4,603,306 254,274 34,034 3,621,056 165,801 22,797 4,636,441 268,864 35,620

As recommended by Sri Lanka Accounting Standard 3 - ‘Presentation of Financial Statements Share of Associate Companies profit is presented after tax, in the consolidated Income Statements.

48 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 17. INCOme tax expenses Group Company For the year ended 31st March 31st March 31st March 31st March 2008 2007 2008 2007

(a) Income Statement (i) Current tax Charge for the year 1,188,487 344,528 2,632 250 adjustment in respect of prior year 76 14,787 – – Economic service charge (write-back)/write-off 8,450 – (17,933) – 367,765 250 1,170,630 2,632

(ii) Deferred Tax Origination and reversal of temporary differences in the current year 272,241 263,379 – – Adjustment in respect of prior year 60,713 – – – 324,092 – 272,241 – 691,857 250 Total Income Tax Expense 1,442,871 2,632

Income tax expenses maybe anslysed as follows: Current Tax Sri Lanka 36,255 69,694 2,632 250 Overseas 298,071 – 1,134,375 – 367,765 250 1,170,630 2,632 Deferred Tax Sri Lanka (7,477) 80,115 – – Overseas 243,977 – 279,718 – 324,092 – 272,241 – Total Sri Lanka 28,778 149,809 2,632 250 Overseas 542,048 – 1,414,093 – 691,857 250 1,442,871 2,632

(b) Statement of Changes in Equity Deferred income tax related to items charged/(credited) directly to equity: 3,246 – 32 – 3,246 – 32 –

Annual Report 2007/08 Bukit Darah PLC 49 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) Group Income Statement Balance Sheet For the year ended 31st March 31st March 31st March 31st March 2008 2007 2008 2007

(c) Deferred Tax Assets - Charge for the year Capital allowances in excess of depreciation 8,569 (176) (464) (544) Provision (60) (119) 680 833 Provsion for retirement benefit obligation (123) (5,169) 17,660 10,404 Unabsorbed tax losses carried forward (138,750) (87,276) 225,304 96,335 Unabsorbed capital allowances 9,434 646 454 – (83,306) 107,674 (129,910) 243,180

(d) Deferred Tax Liabilities - Charge for the year Property plant & equipment 88,911 17,703 768,922 667,182 Investment in property (259) 27,005 89,636 91,986 Biological assets 292,131 333,832 1,069,551 799,399 Immature plantation 1,379 8,887 71,505 69,859 Intangible assets (365) 925 569 943 Finance leases 18,940 24,938 67,526 50,033 Unrealised gain from forward sales contracts (5,892) – 1,414 1,376 407,398 1,679,402 402,151 2,069,085 324,092 (1,571,728) Net deferred tax charge for the year 272,241 (1,825,905)

(e) The gross movement on the deferred income tax account is as follows: Group For the year ended 31st March 31st March 2008 2007

Balance at the beginning of the year (1,571,728) (1,202,401) Charge for the year (272,241) (324,092) Impact of exchange rate changes on conversion (45,235) 18,064 Balance at the end of the year (1,571,728) (1,825,905)

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes relate to the same fiscal authority. The offset amounts are as follows:

For the year ended 31st March 31st March 2008 2007

Net Deferred Tax Assets/Liabilities Deferred tax liability 2,069,085 1,679,402 Deferred tax assets (107,674) (243,180) Net deferred tax liability 1,571,728 1,825,905

Deferred taxation has been computed using current effective tax rates.

50 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) Group Company For the year ended 31st March 31st March 31st March 31st March 2008 2007 2008 2007

(f) Reconciliation of Accounting Profit with Taxable Profit Profit before taxation 5,316,352 2,791,801 11,468 73,235 Revaluation gains – (324,598) – (31,663) Dividends (439,740) (392,697) (9,805) (8,998) Exempt profits (109,223) (594,899) (279) (26,640) Aggregate tax allowed claims (1,846,616) (1,131,167) – – Aggregate tax disallowed expenses 548,864 599,658 19,260 5,084 Operational losses incurred during the year 369,713 – 692,395 – Adjusted profits 4,162,032 1,317,811 20,644 11,018 Inter-company transactions liable to tax 64,604 50,847 – – Share of associate companies’ profit (36,754) (26,819) – – Tax losses utilised during the year (24,306) – (40,469) (7,225) Taxable income of the Group 1,317,533 11,018 4,149,413 13,419

Taxation on Profits Taxation in Sri Lanka Tax charge at 10% [Note 17 (i) (vi)] 6,354 2,166 836 – 15% [Note 17 (i) (iv) & (v)] – – – – 15% [Note 17 (h) (i)] – 3,265 – 237 35% [Note 17 (h) (i)] 46,827 55,195 1,770 Social Responsibility Levy [Note 17 (h) (iii)] 1,007 618 26 13 Overseas taxation [Note 17 (h) (ii)] 1,134,375 298,071 – – ESC (write-back)/write-off [Note 17 (j)] 8,450 – (17,933) – 367,765 250 1,170,630 2,632

Group Company 2008 2007 2008 2007

(g) Analysis of Tax Losses Tax losses brought forward 1,176,686 831,279 19,878 23,760 Adjustment on losses brought forward (102,548) – – – Tax losses incurred during the year 690,206 369,713 – – Utilisation of tax losses during the year (24,306) (3,882) (40,469) (7,225) Tax losses carried forward 1,176,686 19,878 1,723,875 12,653

Utilisation of tax losses in the current year has resulted in a tax saving for the Group of Rs. 5.9 mn (2007 - Rs. 4.4 mn).

In Sri Lanka the utilisation of current years brought forward losses is restricted to 35% of statutory income. Unabsorbed tax losses can be carried forward indefinitely. Tax legislation that governs overseas operations does not restrict the utilisation of tax losses.

Annual Report 2007/08 Bukit Darah PLC 51 Notes to the Financial Statements

(h) Taxation of Profits (i) Income Tax in Sri Lanka In accordance with provisions of the Inland Revenue Act No. 10 of 2006 and amendments thereto, the Company and all other companies of the Group other than those entitles disclosed in Note (i) operating in Sri Lanka, are chargeble to income tax at 35% (2007 - 35%). The concessionery tax rate of 15% granted for companies having taxable profit less than Rs. 5 mn was removed by the amendment made to the Inland Revenue Act No. 10 of 2006 effective from financial year 2007/2008 where such company belongs to a group.

A source of profit that amounts to a capital gain for purpose of tax is not liable to income tax in Sri Lanka and Malaysia. These profits are however subject to tax in Indonesia.

In Sri Lanka dividend income received from a local corporate and subject to dividend tax is not liable to income tax.

(ii) Income Tax on Overseas Operations Profits of subsidiary companies operating in Malaysia are liable to income tax at 26% (2007 - 27%).

Profits of subsidiary companies operating in Indonesia are liable to income tax at 30% (2007 - 30%).

(iii) Social Responsibility Levy All companies operating in Sri Lanka are required to pay 1% of income tax as a Social Responsibility Levy (2007 - 1%).

(i) Tax Exemptions and Concessions (i) In terms of an agreement entered into with the Board of Investment, the business profits of Lion Brewery Ceylon Ltd. are exempt from income tax for a period of 12 years. The tax holiday ends in May 2010.

(ii) In terms of agreements entered into with the Board of Investment, the business profits & income of Equity Nine (Private) Limited and Equity Developers (Private) Limited are exempt from Income tax for a period of 5 years, Equity Property Developers (Private) Limited is exempt from income tax for a period of 6 years. Commencement of tax holidays will be reckoned according to the agreements.

(iii) In terms of Section 13(t) of Inland Revenue Act, profits derived on the sale of shares on which share transaction levy has been paid is exempt from income tax.

(iv) Profits from the agriculture undertaking carried on in Malaysia is liable to tax at 15% in terms of Section 46 of the Inland Revenue Act.

(v) In terms of Section 46 of the Inland Revenue Act, operational profits of a hotel are subject to income tax at 15%.

(vi) In terms of Section 55 of the Inland Revenue Act, dividend received from outside Sri Lanka is liable to tax at 10%.

(j) Economic Service Charge Economic Service Charge paid by companies is available as income tax credit. In instances where recoverability is not possible due to the tax status, sums paid are written off to the Income Statement.

52 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 18. Dividends Company For the year ended 31st March 31st March 2008 2007

Dividends on 8% Participating Cumulative Preference Shares Annual Dividend - Rs. 0.14 per share 144 144 Final dividend - 2007 - Rs. 7.50 per share (2006 - Rs. 3.50 per share) 1,353 631 Interim dividend (2007- Rs. 35.50 per share) 6,402 – 7,177 1,497 Dividends on Ordinary Shares Final dividend - 2007 - Rs. 1.00 per share (2006 - Rs. 0.50 per share) 10,000 5,000 Interim dividend (2007 - Rs. 4.50 per share ) 45,000 – 50,000 10,000 57,177 11,497 Proposed First & Final Devidend Ordinary Shares - Rs. 5.00 per share ( 2007-Rs 1.00 per Share) 50,000 10,000 8% participating cumulative preference shares - Rs. 39.50 (2007 - Rs. 7.50 per share) 1,353 7,125 11,353 57,125

(a) Proposed First & Final Devidend The Board of directors have recommended the payment of a first & final dividend of Rs. 5.00 per ordinary share (2007 - Rs. 1.00 per share) and Rs. 39.50 per participative cumulative preference share (2007 - Rs. 7.50 per share) for the year ended 31st March 2008, which is to be approved at the Annual General Meeting to be held on 30th June 2008. In accordance with Sri Lanka Accounting Standard No. 12 (Revised), ‘Events After the Balance Sheet Date’, this proposed final dividend has not been recognised as a liability as at 31st March 2008.

(b) Compliance with Sections 56 and 57 of Companies Act No. 7 of 2007 As required by Section 56 of the Companies Act No. 7 of 2007, the Board of Directors of the Company have determined that the Company satisfies the solvency test in accordance with Section 57, prior to recommending the first and final dividend. A statement of solvency completed and duly signed by the Directors on 26th May 2008 has been audited by M/s KPMG Ford, Rhodes, Thornton & Co.

Annual Report 2007/08 Bukit Darah PLC 53 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

19. EARNINGS PER ORDINARY SHARE The Group’s earnings per ordinary share of Rs. 148.63 (2007 - Rs. 80.37) and Company’s earnings per ordinary share of Rs. 0.16 (2007 - Rs. 6.51) are calculated by dividing the profit attributable to the ordinary shareholders of Bukit Darah PLC net of exceptional gains/losses and after deducting the preference dividend by the weighted average number of ordinary shares in issue during the year. The amounts used in calculating the earnings per share are as follows: Group Company For the year ended 31st March 31st March 31st March 31st March 2008 2007 2008 2007 Restated

Amount used as the Numerator Profit for the period 3,873,480 2,099,944 8,836 72,985 Dividend on preference shares (7,269) (7,899) (7,269) (7,899) Minority Interest (2,382,821) (1,288,303) – – Profit attributable to ordinary shareholders 803,742 65,086 1,483,390 1,567

Number of ordinary shares used as the Denominator Ordinary shares in issue 10,000,000 10,000,000 10,000,000 10,000,000 Earnings per ordinary share Rs. 148.34 80.37 0.16 6.51

20. Property, Plant & Equipment - GROUP Freehold Leasehold Mature, Plant & Motor Equipment, Computers Total Land & Land & Immature Machinery Vehicles Furniture & Buildings Buildings Plantations Fittings and Roads & Bridges

(a) Cost/Valuation As at 1st April 2007 6,073,675 2,901,712 296,456 3,674,109 400,349 265,924 206,152 13,818,377 Revaluation 104,723 – – – – – – 104,723 Additions 2,642 193,155 10,756 106,186 173,050 68,605 39,909 594,303 Transferred from Capital Work in Progress 137,795 688,534 1 777,721 – 651 279 1,604,981 Disposals/written-off (11,851) – – – (23,971) (12,101) (8,212) (56,135) Exchange translation difference 292,529 (82,150) 77 (56,269) (8,780) (4,118) (4,106) 137,183

As at 31 March 2008 6,599,513 3,701,251 307,290 4,501,747 540,648 318,961 234,022 16,203,432

Depreciation/Amortisation As at 1st April 2007 75,899 155,901 14,598 1,350,997 173,770 98,018 123,408 1,992,591 Transfer to intangible assets – Charge for the year 18,694 106,165 6,398 362,458 87,541 40,601 43,095 664,952 Transfers/adjustments 1,126 56 – (197,551) 291 312 – (195,766) On disposal/ written off (17) – – – (23,799) (1,509) (1,586) (26,911)

Exchange translation difference 922 (5,971) 27 (15,460) (2,657) (1,601) (1,148) (25,888)

As at 31 March 2008 96,624 256,151 21,023 1,500,444 235,146 135,821 163,769 2,408,978

Net Book Value

As at 31st March 2008 6,502,889 3,445,100 286,267 3,001,303 305,502 183,140 70,253 13,794,454

54 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

Freehold Leasehold Mature, Plant & Motor Equipment, Computers Total Land & Land & Immature Machinery Vehicles Furniture & Buildings Buildings Plantations Fittings and Roads & Bridges

(b) Cost/Valuation As at 1st April 2006 5,669,415 1,628,721 259,548 3,444,511 275,797 191,389 135,518 11,604,899 Revaluation 55,603 – – – – – – 55,603 Transferred to investment property (165,000) – – – – – – (165,000) Transfer to intangible assets – – – – – – (12,897) (12,897) Additions 15,120 1,121,566 36,777 102,089 112,947 73,448 32,191 1,494,138 Transfers/Disposals 530 26,318 36,934 (5,374) (6,088) 48,239 100,559 Exchange translation difference 498,007 125,107 131 90,575 16,979 7,175 3,101 741,075

As at 31 March 2007 6,073,675 2,901,712 296,456 3,674,109 400,349 265,924 206,152 13,818,377

Depreciation/Amortisation As at 1st April 2006 27,061 72,289 9,546 1,050,917 117,479 74,532 94,145 1,445,969 Transfer to intangible assets – – – – – – (785) (785) Charge for the year 17,308 77,645 3,022 267,611 60,439 22,305 33,965 482,295 Transfers/Disposals – (377) – (541) (11,787) (1,320) (5,667) (19,692) Devaluation 28,051 – – – – – – 28,051 Exchange translation difference 3,479 6,344 2,030 33,010 7,639 2,501 1,750 56,753

As at 31 March 2007 75,899 155,901 14,598 1,350,997 173,770 98,018 123,408 1,992,591

Net Book Value

As at 31st March 2007 5,997,776 2,745,811 281,858 2,323,112 226,579 167,906 82,744 11,825,786

Annual Report 2007/08 Bukit Darah PLC 55 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) (c) Details of Group Lands & Buildings Stated at Valuation are Indicated below:

Property Method of Effective Date Valuer Land Extent Carrying Value Carrying Value Valuation of Valuation (in Acres) of Revalued of Revalued Assets as at Assets as at 31st March 2008 31st March 2008 If carried at Historical Cost

Pegasus Hotels of Ceylon PLC Market/income 31.03.2006 Messrs. A.Y. Daniel & Son, 20.21 125,807 568,772 Wattala, Sri Lanka Approach professional valuers

Ceylon Brewery PLC Market/Income 31.03.2006 Messrs. A.Y. Daniel & Son, 15.55 3,717 7,750 Nuwara Eliya, Sri Lanka Approach professional valuers

Lion Brewery (Ceylon) PLC Market/Income 31.03.2006 Messrs. A.Y. Daniel & Son, 17.63 840,978 1,010,565 Biyagama, Sri Lanka Approach professional valuers

Equity Two PLC Market/Income 31.03.2007 Messers A.Y. Daniel & Son, 0.54 416,271 540,863 Colombo 1, Sri Lanka Approach professional valuers

Selinsing PLC Agricultural 30.06.2007 Encik W.M. Malik, Member of the 1,217.84 11,726 1,294,831 Malaysia Value Institution of Surveyors, Malaysia, a partner with W.M. Malik & Kamaruzuman.

Indo-Malay PLC Agricultural 30.06.2007 Kamaruzuman, Chartered 725.30 599,202 964,785 Malaysia Value Surveyors & Valuers of Malaysia

Good Hope PLC Agricultural 30.06.2007 Encik W.M. Malik, Member 780.68 581,456 882,655 Malaysia Value of the Institution of Surveyors, Malaysia, a partner with W.M. Malik & Kamaruzuman.

Shalimar (Malay) PLC Agricultural 30.06.2007 Encik W.M. Malik, Member 757.28 221,694 1,232,668 Malaysia Value of the Institution of Surveyors, Malaysia, a partner with W.M. Malik & Kamaruzuman.

3,535.03 2,800,851 6,502,889

(d) Carrying Value of Property, Plant & Equipment Group As at 31st March 2008 2007

At cost 6,948,339 5,391,895 At valuation 6,502,889 5,997,776 On finance lease 436,115 343,226 11,825,786 13,794,454

56 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(e) Finance Leases Property, plant & equipment include capitalised finance leases. The carrying value of these assets are as follows:

Motor Vehicles Heavy Equipment Total 2008 2007 2008 2007 2008 2007

Cost 202,859 235,012 277,953 283,913 480,812 518,925 Accumulated depreciation (49,371) (33,439) (82,810) (80,467) (57,119) (137,586) 185,641 250,474 436,115 122,392 220,834 343,226

During the financial year, the group acquired heavy equipment and motor vehicles with an aggregate cost of Rs. 259.2 mn (2007 - Rs. 145.8 mn) of which Rs. 31.3 mn (2007 - Rs 141.9 mn ) were acquired by means of finance lease.

(f) The freehold land of the Malaysian subsidiaries, Shalimar (Malay) PLC, Good Hope PLC, Selinsing PLC and Indo- Malay PLC have been revalued on 30th June 2007 based on professional valuation carried out by an independent firm of valuer, based on an existing use basis. The freehold land is subsequently carried at fair value, based on a valuation every five years by an external independent valuer, less impairment losses.

(g) Property, plant & equipment other than assets under finance/leases of PT Agro Indomas have been revalued as at 31st March 2008, by PT Heburinas Nusantara, a professional valuer in Jakarta. The value attributed of Rs. 6,049 mn (US $ 56.09 mn) 2007 - 5,131 mn (US $ 47.12 mn) has not been incorporated into the subsidiary Company’s Financial Statement.

Property, plant & equipment other than assets under finance/leases of PT Agro Bukit have been revalued as at 31st March 2008, by PT Heburinas Nusantara, a professional valuer in Jakarta. The value attributed of Rs. 2,628 mn (US $ 24.37 mn) 2007 - 2,036 mn (US $ 18.70 mn) has not been incorporated into the subsidiary Company’s Financial Statement.

(h) There has been no impairment of property, plant & equipment which require a provision.

(i) Government Acquisition Revocation By order published under the Urban Development Projects (Special Provision) Act No. 02 of 1980 in the Gazette Extraordinary of the Democratic Socialist Republic of Sri Lanka - No. 1473/30 of 1st December 2006, H.E. the President has declared that the properties bearing Assessment Nos. 51-53, 55 and 61, Janadhipathi Mawatha, Colombo 1 belonging to the Subsidiary, Equity Two PLC are required for the purpose of carrying out the ‘Presidential Square Project’. This order was subsequently revoked by the Gazette Notification No.1498/15 dated 25th May 2007, under the hand of H.E. the President.

Annual Report 2007/08 Bukit Darah PLC 57 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

21. Capital Work-in-Progress Group 2008 2007

Amount at the beginning of the year 1,867,803 457,057 Cost incurred during the year 898,474 1,490,335 Transferred to Investment Properties – (94) Disposals/written-off (243,897) – Transferred to property plant & equipment (1,604,981) (125,656) Exchange translation difference 46,161 (10,156) At the end of the year 1,867,803 907,243

Capial work-in-progress consists of

Land Improvements 328,855 Buildings 263,699 Plant & Machinery 314,689

907,243

22. PREPAID lease payment Land Rights 2008 2007

Cost/Valuation Balance as at the beginning of the year 336,288 248,795 Additions 7,881 71,597

Exchange translation difference (7033) 15,896

Balance as at end of the year 337,136 336,288 Accumulated amortisation Balance as at the beginning of the year 18,378 6,512 Amortisation 9,986 3,922

Exchange translation difference (644) 7,944

Balance as at end of the year 27,720 18,378

Balance as at the end of the year 309,416 317,910

The land rights of the PT Agro Indomas in the form of ‘Hak Guna Usaha’ (HGU) will expire in the following years:

Property Land Extent (in Ha) Year of Expiration

*PT Agro Indomas 12,104 2028 3,760 2033

15,864

* Management believes that the existing land rights will be renewed by the Government of Indonesia upon expiration because under the laws of Indonesia the land rights can be renewed upon the request of the HGU holder (subject to the Government of Indonesia approval).

58 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

23. Investment Property Group As at As at Land Building 31st March 31st March Freehold Freehold 2008 2007

(a) Investment Properties of the Group comprise of; Equity One PLC. 734,000 189,650 923,650 923,650 Equity Three (Private) Limited 84,260 52,400 136,660 136,660 Equity Five Limited 105,375 40,000 145,375 145,375 Selinsing PLC 165,000 262 165,094 165,262

1,088,635 282,312 1,370,947 1,370,779

Freehold Land Freehold Building Total Total 31st March 31st March 2008 2007 2008 2007 2008 2007

(b) Movements of Investment Properties Balance as at the beginning of the year 1,088,635 880,391 282,145 355,135 1,370,780 1,235,526 Transfer from property, plant & equipment – 165,000 – 94 – 165,094 Additions during the year – – 167 – 167 – Disposal during the year – (174,871) – (52,498) – (227,369) Gain/Loss on fair value adjustment 218,115 (20,586) 197,529 – – – 1,088,635 282,145 1,370,779 1,088,635 282,312 1,370,947

(c) Change in fair value of investment properties Equity One PLC. – 161,925 – (3,231) – 158,694 Equity Three (Private) Limited – 21,065 – (5) – 21,060 Equity Five Limited 35,125 (17,350) 17,775 – – – 218,115 (20,586) 197,529 – – –

(d) During the year, in keeping with the policy frame work, a Director’s valuation was carried out on the investment properties of the group. Since the condition that affect the market value of the investment property has not changed materially over the year. Directors were of the view that the previous years professional valuation figures would reflect the fair value of the Group’s investment properties as at the Balance Sheet date.

Investment properties are stated at fair value, which has been determined on the basis of market value and return on income generation for land and building respectively.

A professional valuation was last performed by Messrs A.Y. Daniel & Son, incorporated valuers as at 31st March 2007.

Annual Report 2007/08 Bukit Darah PLC 59 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(e) Details of Investment Properties

Name of building/location Tenure Description Extent Net lettable Fair Value Historical Effective of land (in Acres) area sq.ft. 31st March Cost Date of 2008 2008 Valuation

Equity One PLC. Dharmapala Mw., Colombo 7 Freehold Office space 0.60 44,163 632,650 96,651 31-Mar-07 Equity One PLC. Vauxhall Lane, Colombo 2 Freehold Warehouse complex 1.36 32,353 291,000 226,303 31-Mar-07 Equity Three (Private) Limited George R. De Silva Mw., Colombo 13 Freehold Office space 0.26 33,400 136,660 55,497 31-Mar-07 Equity Five Limited Braybrooke Street, Colombo 2 Freehold Office space 0.44 15,703 145,375 70,371 31-Mar-07 Selinsing PLC, Katunayake Freehold 7.65 – 165,262 109,396 31-Mar-07

10.31 125,619 1,370,947 558,218

24. Intangible Assets Goodwill Computer Software License Total 2008 2007 2008 2007 2008 2007 2008 2007

Cost/Valuation Balance as at the beginning of the year 244,214 82,731 67,871 41,082 – – 312,085 123,813 Additions/(Reversals) (2,907) 161,483 22,687 25,061 5,571 – 25,351 186,544 Exchange translation difference – – (1,228) 1,728 – – (1,228) 1,728

241,307 244,214 89,330 67,871 5,571 – 336,208 312,085

Accumulated Amortisation Balance as at the beginning of the year – – 20,810 6,310 – – 20,810 6,310 Amortisation – – 16,552 14,160 139 – 16,691 14,160 Exchange translation difference – – (489) 340 – – (489) 340

– – 36,873 20,810 139 – 37,012 20,810

Net Balance as at the end of the year 241,307 244,214 52,457 47,061 5,432 – 299,196 291,275

(a) Goodwill Goodwill is allocated to cash generating units (CGU) identified according to its business segment.When testing for impairment for goodwill, the recoverable amount of a cash generating unit is determined on the basis of value-in-use calculations. These calculations use cash flow projections based on financial budgets, which are approved by management, typically covering a five-year period. Cash flows beyond the five year period are extrapolated using the estimated growth rates. The cash flows were discounted at an appropriate pre-tax discount rate equivalent to the average treasury bond rate.

(b) Computer Software Software with a finite life is amortised over the period of the expected economic benefit.

60 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

25. Biological Assets (a) Fair Value of Biological Assets Group As at As at 31st March 31st March 2008 2007

Carrying value at the beginning of the year 7,308,318 5,211,433 Plantation development costs 1,249,539 1,454,548 Gain from changes in fair value 779,113 346,191 Impact of exchange rate changes on conversion at consolidation (194,538) 296,146

Carrying value at the end of the year 9,142,432 7,308,318

(b) Analysis of Biological Assets 2008 Planted area (in hectares) Mature 15,243 5,825,924 5,097,753 Immmature plantation 2,210,565 16,465 3,316,508 7,308,318 31,708 9,142,432

(c) Analysis of Oil Palm Production Production of fresh fruit bunches (MT) 400,616 292,848 Production of crude palm oil (MT) 99,837 70,937 Production of parm kernel (MT) 21,572 14,814

(d) Basis of Recognition The palm oil plantation of the subsidiaries incorporated in Indonesia are stated at fair value in accordance with International Accounting Standards 41 ‘Agriculture’ as the accounting framework, adopted by Indonesia is based on the International Accounting Standards.

(e) Measurement of Fair Value The fair value of biological assets has been determined based on a report from an independent professional valuer, PT Heburinas Nusantara (which has an association with CB Richard Ellis) dated 4th April 2007. The valuation of the biological assets was performed in accordance with the Indonesian Valuation Standards (‘Standar Penilaian Indonesia/SPI’) which are based on the International Valuations Standards. The valuations were based on the following assumptions:

(i) Projected economic production life of an oil palm plant is 22 years after maturity. (ii) Discount rate per annum of 16% in 2008 (2007 - 16%). (iii) CPO selling price for the first year is Rp. 5,154/Kg. (iv) Oil and Kernel extraction rates are 23% and 4% per annum, respectively.

(f) As at 31st March 2008 the fair value of biological assets of the Group mortgaged as securities for bank loans amounted to Rs. 3,990,450 (2007- Rs. 2,286,898)

(g) The interest capitalised is actual interest incurred on the bank borrowings to finance the development of oil palm plantation.

Annual Report 2007/08 Bukit Darah PLC 61 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

26. Long-Term Investments Investment Portfolio Summary Group Company As at 31st March 2008 2008 2007 2007 2008 2007 Note Cost Market Value Cost Market Value Cost Cost

A. Investments in Subsidiariary Companies Quoted – – – – 588,563 588,563 Unquoted – – 738,176 – – 738,176 Total-Investments in subsidiariary Companies – – 1,326,739 – – 1,326,739

B. Investments in Associate Companies Quoted 379,789 790,392 337,608 771,956 36 36 Unquoted 12,509 7,369 – 14,396 7,369 – Total-Investments in Associate Companies 350,117 779,325 36 394,185 797,761 36

C. Long-Term investments Quoted 2,091,824 8,131,186 1,941,212 8,990,928 – – Unquoted 337,672 337,672 – 762,193 762,193 – Total 2,278,884 9,328,600 – 2,854,017 8,893,379 –

(a) Investment in Subsidiaries Group Company No. of Cost Cost No. of Cost Cost Shares as at as at Shares Valuation at Valuation at as at 31st 31st March 31st March as at 31st 31st March 31st March March 2008 2008 2007 March 2008 2008 2007

(i) Quoted Investments Investments in Ordinary Shares Carson Cumberbatch PLC 2,836,306 588,563 588,563 2,836,306 588,563 588,563 Equity One PLC 38,141,543 1,060,402 1,060,402 – – – Equity Two PLC 27,532,935 448,839 448,839 – – – Pegasus Hotels of Ceylon PLC 25,369,210 322,140 322,140 – – – Selinsing PLC 5,985,512 29,142 29,142 – – – Good Hope PLC 5,972,179 11,003 11,003 – – – Indo-Malay PLC 5,372,120 62,690 62,690 – – – Shalimar (Malay) PLC 6,319,752 413,507 413,507 – – – Ceylon Guardian Investment Trust PLC 13,919,497 660,227 660,227 – – – Ceylon Investment PLC 15,313,647 397,064 397,064 – – – Watapota Investments PLC 582,225 10,121 10,121 – – – Ceylon Brewery PLC 15,726,922 713,415 713,415 – – – Lion Brewery (Ceylon) PLC 27,447,998 594,410 594,410 – – –

Total investment in Subsidiaries - quoted 5,311,523 5,311,523 588,563 588,563

62 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

Group Company No. of Cost Cost No. of Cost Cost Shares as at as at Shares Valuation at Valuation at as at 31st 31st March 31st March as at 31st 31st March 31st March March 2008 2008 2007 March 2008 2008 2007

(ii) Unquoted Investment Goodhope Asia Holding Ltd. 5,996,413 461,121 – – – – PT Agro Bukit 7,438,500 826,707 826,707 5,785,500 642,561 642,561 Shalimar Developments Sdn. Bhd. 3,942,123 824,959 824,959 525,652 95,615 95,615 PT Agro Indomas 38,037 542,805 542,805 – – – Rubber Investment Trust Limited 9,300,000 698 698 – – – Carsons Airline Services (Private) Limited 399,999 3,999 1,000 – – – Carsons Management Services (Private) Limited 16,334,140 163,341 163,341 – – – PT Agro Harapan Lestari 150,000 15,545 – – – – Agro Harapan Lestari Sdn Bhd 168,000 5,935 – – – – Carsons Real Estate Management Services (Private) Limited 500,000 5,000 – – – – Guardian Fund Management Limited 1,045,015 10,450 10,450 – – – Equity Hotels Ltd. 685,368 6,711 6,711 – – – Leechman & Company (Private) Limited 5,159,999 849 849 – – – Mylands Investments Limited 115,268 5,339 5,340 – – – Weniwella Investments Limited 93,352 4,501 4,501 – – – Nuwara Eliya (Holdings) PLC – – 30,000 – – – Equity Three (Private) Limited 5,399,999 103,214 103,214 – – – Equity Five Limited 3,000,002 110,388 110,388 – – – Equity Seven Limited 3,271,878 43,147 43,147 – – – Equity Property Developers (Private) Limited 10,000,000 100,000 100,000 – – – Equity Developers (Private) Limited 499,998 5,000 5,000 – – – Equity Nine (Private) Limited 4,999,998 50,000 50,000 – – –

3,289,709 2,829,110 738,176 738,176

(iii) Investments in Unquoted Deferred Shares Ceylon Guardian Investment Trust PLC 13,248 135,780 135,780 – –

Total Investment in Subsidiaries Unquoted 3,241,343 2,964,890 738,176 738,176

Total Investment in Subsidiaries 8,552,866 8,276,213 1,326,739 1,326,739

Annual Report 2007/08 Bukit Darah PLC 63 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) (b) Investment in Associate Companies (i) Movements of Investments in Associate Companies Group Company Total as at Total as at Total as at Total as at 31st March 31st March 31st March 31st March 2008 2007 2008 2007 Restated Restated

Balance as at the beginning of the year 350,117 356,440 35 35 Additions – 2,261 – – Share of associate companies’ profit for the year 35,895 21,507 – – Dividend received (6,468) (4,356) – – Changes in equity (25,735) – 14,641 – 350,117 35 Balance as at the end of the year 394,185 35

(ii) Measurement of Associate Companies No. of Carrying Market Value/ No. of Carrying Market Value/ Shares Value Valuation Shares Value Valuation as at as at as at as at 31st March 31st March 31st March 31st March 2008 2008 2007 2007

Investment in Associate Companies - Ordinary Shares ACW Insurance (Pvt) Ltd. 449,999 1,869 1,869 449,999 1,869 1,869 The Unit Trust Management Company (Private) Limited 550,000 5,500 5,500 550,000 5,500 5,500 Union Assurance PLC 9,244,352 304,734 771,956 13,866,526 304,734 790,392 312,103 779,325 312,103 797,761 Group Share of Associate Companies - Retained Assets ACW Insurance (Pvt) Ltd. 55 – (117) – The Unit Trust Management Company (Private) Limited 6,972 – 5,257 – Union Assurance PLC 32,874 – 75,055 – 38,014 – 82,082 – Total investments in associate companies (equity basis) 350,117 779,325 394,185 797,761

64 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) (iii) Summarised financial information for the group’s share of associates is set out below:

2008 2007

Revenue 624,512 487,331 Profit from operations 83,234 57,776 Profit before taxation 36,754 26,819 Taxation (4,022) (1,134) Profit of the year 22,079 35,895

Non- Current assets 1,775,320 1,502,787 Current assets 20,733 34,127 Total assets 1,523,520 1,809,447 Non-current liabilities 1,387,668 1,158,314 Current liabilities 15,089 27,594 Total liabilities 1,173,403 1,415,262 Net assets 350,117 394,185 Group share of net assets(as above) 350,117 394,185

No. of Carrying Market Value/ No. of Carrying Market Value/ Shares Value Valuation Shares Value Valuation as at as at as at as at 31st March 31st March 31st March 31st March 2008 2008 2007 2007

(iv) Investments in Associate Companies - Company On Ordinary Shares Union Assurance PLC 1,041 36 87 1,561 36 89 Total Investments in Associate Companies 36 87 36 89

(c) Long-Term Investments (i) Movements in Long-Term Investments Group As at As at 31st March 31st March 2008 2007

Balance as at the beginning of the year 2,278,884 1,562,133 Additions during the year 635,211 914,976 Disposals/redemptions (58,078) (198,225) Impairment of investments – (2,000)

Balance as at the end of the year 2,278,884 2,854,017

Annual Report 2007/08 Bukit Darah PLC 65 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(ii) Measurement of Long-Term Investments - Group No. of Cost Market Value/ No. of Cost Market Value/ Shares as at Valuation as at Shares as at Valuation as at 31st March 31st March 31st March 31st March 2008 2008 2007 2007

(a) Quoted Investments Beverage, Food & Tobacco Keells Food Product PLC – – – 200 9 10 Ceylon Cold Stores PLC 4,364,911 289,904 567,438 4,364,911 289,904 663,466 Distilleries Company of Sri Lanka Limited 3,258,900 145,246 319,372 2,955,300 115,180 310,307 Nestlé Lanka PLC 17,200 3,118 4,317 17,200 3,118 4,472 Cargills (ceylon) Limited – – – 112,000 113,148 223,972 408,211 978,255 551,416 891,128 Diversified Aitken Spence PLC 464,700 156,494 199,821 464,700 156,495 176,586 Hayleys PLC 4,028,281 74,980 393,764 4,028,281 75,398 572,016 Hemas Holdings PLC 651,100 69,127 56,971 651,100 69,128 69,668 John Keells Holdings PLC 17,864,317 814,725 2,768,969 16,864,317 759,432 2,015,286 1,115,746 3,587,239 1,060,033 2,665,843

Health care Ceylon Hospitals PLC (Durdans) – – 466,100 29,003 27,034

Oil Palm Plantations Bukit Darah PLC 2,733,875 12,334 3,660,959 2,733,875 12,344 3,827,425 Hotels & Travels Asian Hotels & Properties PLC 1,699,200 77,403 77,314 1,699,200 77,403 66,694 Manufacturing Tokyo Cement Company (Lanka) Limited 207,997 8,046 51,999 249,596 8,045 62,711 Stores & Supplies Hunters & Company Limited 257,603 8,722 74,705 257,603 8,722 77,281 Services John Keells PLC 1,661,512 10,312 141,644 1,661,512 10,312 149,536 Telecommunications Dialog Telekom PLC 10,516,000 175,693 176,143 9,560,000 155,618 243,780 Sri Lanka Telecom PLC 4,698,200 135,910 173,833 5,198,200 151,853 214,426 291,528 417,613 327,546 390,569 Power & Energy Lanka IOC Limited 40,000 1,910 1,200 – – Debenture Sampath Bank Limited 7,000 7,000 – 7,000 7,000 – Total long-term 1,941,212 8,990,928 Investments - quoted 2,091,824 8,131,186

66 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

No. of Cost Market Value/ No. of Cost Market Value/ Shares as at Valuation as at Shares as at Valuation as at 31st March 31st March 31st March 31st March 2008 2008 2007 2007

(b) Unquoted Kandy Private Hospitals Limited 1,200 20 20 1,200 20 20 DFCC Vardhana Bank 128,925 1,599 1,599 82,881 975 975 The Sri Lanka Fund – – – 1,002 92 92 Capital Reach Holding Ltd. 200,000 – – 200,000 2,000 2,000 International Grocer’s Alliance (Pvt) Limited 5,100,000 – – 5,100,000 – – South Asian Breweries* (Private) Limited - Singapore – 744,843 744,843 – 319,541 319,541 Lanka Communication Services Limited 1,428,496 15,713 15,713 1,428,496 15,012 15,012 Dormant Companies Equity Investments Lanka Limited 22,500 – – 22,500 – – Colombo Brick Company Limited 1,000 – – 1,000 – – Fantasia Stock & Stockings Limited 1,000 – – 1,000 – – Glowweave Rubber Company Limited 1,000 – – 1,000 – – Lady Havelock Gardens Limited 6,000 – – 6,000 – – Mahaweli Construction Consortium Limited 1,500 – – 1,500 – – Rowlands Limited 35,330 – – 35,330 – – Rubberite Limited 10,000 – – 10,000 – – Total unquoted investments 337,640 337,640 in shares 762,175 762,175

Debentures Riverina Hotels Limited - Zero Coupon 56 – – 56 – – Tangerine Beach Hotels Limited - Zero Coupon 139 14 14 281 28 28 Ocean View Limited - 6% 360 4 4 360 4 4 Total investments in debentures 32 32 18 18

Preference Shares Ceylon Cold Stores PLC - 7% 1,362 – – 1,362 – – Richard Pieris & Company PLC - 8% - Cumulative 1,375 – – 1,375 – – Rowlands Limited - 8% - Cumulative – 1,125 – – 1,125 – Total Investment in Preference Shares – – – – Total Unquoted Investments 337,672 337,672 762,193 762,193 Total Long-term other Investments 2,278,884 9,328,600 2,854,017 8,893,361

Annual Report 2007/08 Bukit Darah PLC 67 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

* A consortium comprising of Carlsberg A/S, The Industrialisation Fund for Developing Nations, SA Lion Holdings (Pte) Limited and Lion Brewery (Ceylon) PLC (LBCPLC) incorporated a company based in Singapore, South Asian Breweries (Pte) Limited (SABL), which in turn wholly owns South Asia Breweries (Pvt) Limited, India. The latter company was formed for the purpose of investing in breweries across the various states of India. LBCPLC owns 22.5% of the share capital of SABL. The Board of SABL comprises of 9 Directors two of whom represent the Company on the Board of SABL. The above investment was disclosed as an Investment in Associate in the previous year Financial Statement of the Group on the basis of the 22.5% holding of SABL. However, as a result of a comprehensive assessment carried out by the management during the year based on Sri Lanka Accounting Standard 27 - ‘Investment in Associates’, it was concluded that the LBCPLC’s influence over SABL is limited because of its minority position both in ownership and on the Board. Accordingly, this investment has been reclassified as a Long-Term Investment by the Group.

During the year ended 31st March 2008 the LBCPLC invested Rs. 425,302/- in South Asian Breweries (Pte) Limited.

(c) Significant Shareholdings in Quoted Investments

Investee % of Group Cost Market Value % of Market Cost Market Value % of Market Holding as at as at Value as at as at as at Value as at 31st March 31st March 31st March 31st March 31st March 31st March 2008 2008 2008 2007 2007 2007

John Keells Holdings PLC 2.69 990,243 2,246,097 24 933,095 2,887,339 28 Union Assurance PLC 36.98 304,734 790,392 9 304,734 771,956 7 Ceylon Cold Stores PLC 20.21 289,904 567,438 6 289,904 663,466 6 John Keells PLC 10.93 10,312 149,536 2 10,312 141,644 1 Hayleys PLC 5.37 74,980 393,764 4 75,398 572,016 6 Distilleries Company of Sri Lanka Limited 1.82 360,503 534,629 6 348,238 543,365 5 Aitken Spence PLC 1.72 156,494 199,821 2 157,673 177,764 2 Sri Lanka Telecom PLC 0.29 151,853 214,426 2 242,144 280,067 3 Dialog Telekom PLC 0.15 202,267 202,717 2 233,393 321,555 3

2,541,290 5,298,821 57 2,594,891 6,359,172 61

Other Quoted Investment 198,152 3,965,641 43 271,766 4,024,423 39

Total Quoted Investments in other Companies & Associates 2,739,442 9,264,462 100 2,866,657 10,383,595 100

27. Inventories Group Company As at As at As at As at 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Raw materials 570,939 142,523 – – Work-in-progress 92,310 26,877 – – Lands held for development and sale [Note 27 (a)] 961,608 788,646 – – Finished goods 377,747 105,311 – – Bottles & crates 466,880 – 239,535 – 1,530,237 – 2,242,139 –

68 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) (a) Details of Land held for Development and Sale Company Location Extent Fair Value Fair Value (in Acres) 31st March 2008 31st March 2007

Equity Property Developers No. 7, De Soysa Mawatha, (Private) Limited Mount-Lavinia 6.00 653,910 535,124 Equity Nine (Private) Limited Mirihana Estate, Mirihana 2.19 287,606 236,624 Equity Developers Private Limited Humbert Estate, Athurugiriya 1.06 16,898 20,092 9.25 788,646 961,608

The interest capitalised is actual interest incurred on the bank borrowings to finance the land held for development and sales.

(b) As at 31st March 2008 Inventories with a carrying a value of Rs. 1,481,928 of the Group were mortgaged as securities for bank loans amounting to Rs. 2,537,450.

28. Trade and Other Receivables Group Company As at As at As at As at 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Financial Assets Trade and other receivables (net of provisions) 559,895 117,825 405 45 Containers with distributors 695,968 541,644 – – Other receivables 838,136 625,530 – – Loans given to employees 2,248 – 3,623 –

2,097,622 1,287,247 405 45

(a) Provision for Impairment of Trade Receivable - Movement during the year Balance as at beginning of the year 1,079 11,081 Provisions during the year – – Write-offs against provisions during the year – (10,002)

Balance as at end of the year 1,079 1,079

(b) Trade receivables are generally non-interest bearing and are generally have 15 to 45 days term. Other credit terms are assessed and aproved on a case-by case basis.They are recognised at their orginal invoice amounts which represents fair value at intial recognition.

29. ADVANCES pending capitalisation Company As at As at 31st March 31st March 2008 2007

PT Agro Bukit 1,189,965 1,189,965 1,189,965 1,189,965

Annual Report 2007/08 Bukit Darah PLC 69 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 30. Short-Term Investments (a) Group Movement in short-term Investments As at 31st March 2008 As at 31st March 2007 Quoted Unquoted Total Quoted Unquoted Total

Balance as at the beginning of the year 620,711 2,546 623,257 428,549 17,559 446,108 Additions 38,365 – 38,365 389,333 – 389,333 Disposals (271,167) (43) (271,210) (351,412) (15,013) (366,425) Mark to market value adjustment for short-term investment 154,241 – 154,241 (45,025) – (45,025) Balance as at the end of the year 620,711 2,546 623,257 342,884 2,503 345,387

(i) Short-Term Investments - Quoted No. of Market Value No. of Market Value/ Shares as at Shares Valuation as at 31st March 31st March 2008 2007

Banks, Finance & Insurance Hatton National Bank PLC 89,600 10,730 – – Housing Development Finance Corporation Bank of Sri Lanka 11,000 1,317 11,000 1,782 Commercial Bank of Ceylon PLC 56,600 – – 7,924 19,971 1,782

Beverage, Food & Tobacco Nestlé Lanka Ltd. 13,500 3,389 14,000 3,640 Distilleries Company of Sri Lanka Limited 2,196,500 2,219,600 233,058 215,257 218,646 236,698

Chemicals & Pharmaceuticals Union Chemicals Lanka Limited 200 28 200 34 Chemical Industries (colombo) PLC 40,000 3,600 – 28 3,634

Diversified Hemas Holdings PLC 19,625 1,717 19,700 2,108 John Keells Holdings PLC 230,811 27,582 763,675 118,370 Aitken Spence PLC – – 3,100 1,178

29,299 121,656

Hotels Aitken Spence Hotel Holdings PLC – 3,400 238 Asian Hotels & Properties PLC 1,211,600 47,555 1,211,600 55,107 Trans Asia Hotels PLC 16,300 1,549 – 47,555 56,894

70 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

No. of Market Value No. of Market Value/ Shares as at Shares Valuation as at 31st March 31st March 2008 2007

Land and Property Huejay International Investment Limited 78,000 3,510 –

Manufacturing Tokyo Cement Co.(Lanka) Limited - Non-voting 24,000 372 20,000 430 Tokyo Cement Co.(Lanka) Limited 13,000 3,250 – 372 3,680 Telecommunications Dialog Telecom PLC 1,586,500 26,574 3,050,000 77,775 Sri Lanka Telecom PLC 2,871,200 106,234 – 26,574 184,009 Power & Energy Lanka IOC Limited 20,000 4 20,000 600 40 Plantations Namunukula Plantations PLC 75,000 1,200 –

Motors United Motors Lanka PLC 88,100 7,048 –

620,711 Total short-term quoted investments 342,884

No. of Market Value/ No. of Market Value/ Shares Valuation as at Shares Valuation as at 31st March 31st March 2008 2007 Rs. ’000 Rs. ’000

(ii) Short-Term Investments - Unquoted Asia Pacific Golf Course Limited 10 2,500 10 2,500 Beverage Dispensing Company Limited 60,000 – 60,000 – Econsult (Pvt) Limited – – 70,000 – Golden Hope Plantations Limited – – 10,630 44 Produce Transport Limited 1 – 1 – Serendib Agro Products Limited 2,500 3 2,500 2 International Grocers Alliance (Pvt) Limited 5,100,000 – 5,100,000 – 2,546 Total unquoted investments 2,503 623,257 Total short-term Investments 345,387

Annual Report 2007/08 Bukit Darah PLC 71 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(b) Company Movement in Short-Term Investments As at As at 31st March 31st March 2008 2007

Balance as at the beginning of the year 102,452 76,504 Additions 629 75,348 Disposals (11,100) (81,062) Mark to market value adjustment* 31,662 (13,079)

78,902 102,452

* This represents the appreciation/depreciation in market value of short-term investment determined on an aggregate portfolio basis.

No. of Market Value/ No. of Market Value/ Shares Valuation as at Shares Valuation as at 31st March 31st March 2008 2007

(i) Quoted Investment Beverage, Food & Tobacco Distilleries Company of Sri Lanka Limited 446,500 43,757 446,500 46,883 Diversified John Keells Holdings PLC 150,857 18,027 150,857 23,383 Hotels & Travels Asian Hotels & Properties PLC 295,300 11,590 295,300 13,436 Telecommunication Dialog Telekom PLC 330,000 5,528 300,000 7,650 Sri Lanka Telecom PLC 300,000 11,100 – Total Short-term quoted Investments 102,452 78,902

The market value of the Company’s quoted investment portfolio has been obtained from the Official Valuation List as at 31st March, 2008 published by the Colombo Stock Exchange.

31. Cash and Cash EquivAlents Group Company As at As at As at As at 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Fixed deposits 83,176 – – – FCBU Deposits 2,320 273,973 – – Call Deposits 288,417 244,484 25,141 48,434 Treasury Bills 12,906 – 13,189 – Short-term deposits 387,102 531,363 25,141 48,434 Cash-in-hand and at Bank 639,422 6,695 1,678,451 53,230 1,170,785 55,129 2,065,553 78,371

72 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) (a) Cash and cash equivalents are denominated in the following currencies:

Group Company As at As at As at As at 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Sri Lankan Rupees. 590,869 597,576 63,179 52,653 US Dollars 304,891 246,657 12,898 185 Sterling Pound 2,447 3,532 243 235 Indonesian Rupiah 1,088,962 276,417 – – Malaysian Ringgit 65,022 43,535 2,051 2056 Euro 3,068 – – 13,362

2,065,553 1,170,785 78,371 55,129 Short-term deposits earn interest at floating rates based on daily bank deposits rates and are made for varying periods between one days and three months, depending on the immediate cash requirement of the Group.

(b) For the purpose of the consolidated cash flow statement, cash equivalent comprise the following: Group Company As at As at As at As at 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Short-term deposits 387,102 531,363 25,141 48,434 Cash-in-hand and at bank 639,422 6,695 1,678,451 53,230 2,065,553 1,170,785 78,371 55,129 Short-term borrowings (1,002,999) (1,652,015) – – Bank overdrafts (604,015) – (1,964,874) – (1,085,245) 55,129 (902,320) 78,371

32. Stated Capital Company & Group 2008 2007

Issued and Fully Paid 10,000,000 Ordinary shares 100,000 100,000 180,350 Participating cumulative preference shares 1,804 1,804 101,804 101,804

In accordance with Section 58 of the Companies Act No. 7 of 2007, Share Capital has been re-classified as Stated Capital. Presentation of comparative information has been re-classified accordingly.

Annual Report 2007/08 Bukit Darah PLC 73 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) Rights, Preference and Restrictions of Classes of Capital 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 a meeting of the Company.

In addition to the 8% cumulative preference dividend, after ordinary shareholders have received a dividend of 0.625%, the holders of participating cumulative preference shares are entitled to participate in the surplus with the holders of the ordinary shares but at eight (8) times the rate of dividend on the Ordinary shares. They are however, not entitled to participate in the surplus assets of the Company.

33. Capital Reserves Group Company As at As at As at As at 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Balance as at the beginning of the year 1,048,370 780,798 40,000 40,000 Revaluation - property, plant & equipment 33,459 – – – Imparirment of property, plant & equipment – (10,571) – – Currency translation 90,629 172,668 – – Transfer – – – – Changes in equity/transfers/adjustments 105,475 – (36,407) – Balance as at the end of the year 1,048,370 40,000 1,136,051 40,000

Represented by Capital redemption reserve 40,000 40,000 40,000 40,000 Revaluation reserve 148,368 24,280 – Other capital reserves 984,090 – 947,683 1,048,370 40,000 1,136,051 40,000

The movements in the above reserves are shown in the Statements of Changes in Equity. Revaluation Reserve Consists of net surplus resulting from the rervaluation of property, plant & equipment. Capital Accretion Reserve The unrealised amount cannot be distributed to shareholders. Capital Redemption Comprises capital redemption funds arising from the redemption of preference shares of subsidiaries and Company. Other Capital Reserves Comprises Share Premium consists of amounts received in excess of the par value of the shares issued by the holding Company.

74 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 34. Revenue Reserves Group Company As at As at As at As at 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Balance as at the beginning of the year 6,164,628 5,017,837 2,510,577 2,494,769 Exchange translation differences 91,171 378,621 – – Profit for the period 1,490,659 811,641 8,836 72,985 Changes in equity/transfers (125,428) 13,706 – – Dividend paid (57,177) (57,177) (11,497) (11,497) Balance as at the end of the year 6,164,628 2,510,577 7,609,533 2,507,916 Represented by General reserve 191,438 173,360 9,283 9,283 Currency translation reserve [Note 34 (a)] 379,303 288,132 – – Investment Property fair value adjustment reserve 345,769 345,769 – – Short-term investment market value adjustment Reserve [Note 34 (a)] 61,059 87,756 18,583 31,662 Retained earnings 5,269,611 2,469,632 6,631,964 2,480,050 6,164,628 2,510,577 7,609,533 2,507,916

(a) Movement of the other Revenve Reserve - Group Currency Translation Investment Property Fair Short-term Investment Reserve Value Adjustment Reserve Market Value Adjustment Reserve As at As at As at As at As at As at 31st March 31st March 31st March 31st March 31st March 31st March 2008 2007 2008 2007 2008 2007

Balance as at the beginning of the year 597,763 184,164 745,192 – 152,554 – Transfer – – – 745,192 (42,428) 152,554

Currency translation differences 208,509 413,599 – – – –

Currency translation reserve 806,272 597,763 745,192 745,192 110,126 152,554 Amount attributable to minority shareholders (426,969) (309,631) (399,423) (399,423) (49,067) (64,798)

Amount attributable to Group shareholders 288,132 345,769 87,756 379,303 345,769 61,059 General Reserve represents the amounts set aside by the Directors for future expansion, and to meet any contingencies.

Currency translation reserve comprises the net exchange movement arising on the translation of net equity investments of overseas subsidiaries into Sri Lankan Rupees.

Annual Report 2007/08 Bukit Darah PLC 75 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

35. bORROWINgs Group As at As at 31st March 31st March 2008 2007

Current Long-Term Borrowings falling due within one year Bank borrowings [Note 35 (a)] 1,145,966 686,438 Finance lease [Note 35 (e)] 145,450 103,615 1,249,581 831,888 Short-term loans 1,002,999 1,652,015 Overdrafts 604,015 1,964,874

3,087,918 4,217,454

Non-Current Long-Term Borrowings falling after one year Bank borrowings [Note 35 (a)] 4,093,146 4,003,537 Finance lease [Note 35 (e)] 132,294 61,067 4,135,831 4,154,213 7,223,749 8,371,667

(a) Movements in Interest Bearing Borrowings Balance as at the beginning of the year 4,689,975 2,241,148 Obtained during the year 4,027,010 1,273,573 5,963,548 6,268,158 Impact of exchange rate changes on conversion (48,963) 105,272 Repayments during the year (1,683,455) (675,473) Balance as at the end of the year 5,239,112 4,689,975 Amounts falling due within one year (686,438) (1,145,966) Amounts falling due after one year 4,003,537 4,093,146

76 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 35. bORROWINgs (Contd.) (b) Details of Interest Bearing Borrowings:

Company Lender/Rate of Balance as at Balance as at Repayment Terms Security Interest (p.a.) 31st March 31st March 2008 2007

Carson Cumberbatch PLC Commercial Bank – 6,500 PLR plus 1% p.a. (PLR to be reviewed quarterly)

Commercial Bank 142,000 167,000 Year 2008 - Rs.142 mn to be re paid on PLR plus 1% p.a. bullet basis (PLR to be reviewed quarterly)

Commercial Bank 114,781 178,781 Year 2008 - 4 quarterly instalments Clean Basis. PLR plus 1% p.a. of Rs. 16.0 mn each. (PLR to be Year 2009 - 3 quarterly instalments reviewed quarterly) of Rs. 16.71 mn each and 1 Instalment of Rs. 16.66 mn in the next quarter. Loan to be fully settled by October 2009.

Commercial Bank 93,750 150,000 Year 2008/2009 - 5 quarterly instalments PLR plus 1% p.a. of Rs. 18.75 mn (PLR to be Loan to be fully settled by February 2009 reviewed quarterly)

Equity Two PLC Bank of Ceylon Ltd. 9,674 14,246 Year 2008 - Rs. 5.1 mn to be paid on Primary Mortgage over 3% per annum bullet basis. the Equity Two.

Equity Three (Private) Commercial Bank of – 2,494 Fully paid during the year 2008. Unsecured. Limited. Ceylon Ltd. PLR + 1%

Equity Developers Hatton National Bank 24,000 18,500 To be repaid in 30 months RPFMB executed over (Private) Limited. AWPLR + 1.5% with an initial grace period the immovable property at (to be reviewed quarterly) of 12 months. Athurugiriya and tertiary owned by Equity One PLC. Equity Property Hatton National Bank 430,000 430,000 To be repaid RPFMB executed over Developers AWPLR + 2.25% after an initial grace the immovable property at (Private) Limited. (to be reviewed period of two years in 11 Mount Lavinia and RPFMB quarterly) equal quarterly instalments to be executed over the of Rs. 36.0 mn and a final property at Dharmapala instalment of Rs. 34.0 mn Mawatha owned by plus interest. Interest to be Equity One PLC. serviced monthly.

Equity Nine Hatton National Bank 250,000 237,500 To be repaid over 36 RPFMB executed over (Private) Limited. AWPLR + 2.25% months after an initial grace the property at Kotte and (AWPLR to be reviewed period of 18 months in 17 secondary mortgage to be quarterly) equal monthly instalments of executed over the property Rs. 14.0 mn and a final at Dharmapala Mawatha. installment of Rs. 12.0 mn plus interest.

Annual Report 2007/08 Bukit Darah PLC 77 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

Company Lender/Rate of Balance as at Balance as at Repayment Terms Security Interest (p.a.) 31st March 31st March 2008 2007

PT Agro Indomas (PTAI) Standard Chartered Bank, 1,833,450 2,286,898 The term loan will mature in Secured by certain property, Term loan - LIBOR+2.4% December, 2009 with an extension receivables, biological assets Working capital loan option for a further five years. and the corporate - LIBOR+1.5% The revolving credit facility carries a guarantees of PTAI. mature period of 12 months.

PT Agro Bukit Standard Chartered Bank, 2,157,000 980,065 The term loan facility will mature in The loan is secured on Singapore Branch December 2009 with an certain property, Term loan - LIBOR+2.4% extension option for a plant and equipment, trade Working capital loan further period of five years. receivables inventory, - LIBOR+1.5% The revolving credit facility carries a biological assets and the maturity period of 12 months for corporate guarantees of each draw down. the Company

Lion Brewery DFCC Bank - 10.5% p. a. 107,043 137,146 6 months, grace and payable in 30 equal Unsecured. (Ceylon) PLC monthly instalments commencing from February 2007

Pegasus Hotels of Commercial Bank 68,639 69,056 To be repaid in 83 equal instalments Corporate guarantee given by Ceylon PLC PLR + 1% - PLR + 2% of Rs. 714,000 balance instalment Carson Cumberbatch & PLC amounting to Rs.738,000.

Equity Hotels Limited Commercial Bank - 13.5% 8,775 11,789 To be repaid within three years after a Corporate guarantees given grace period of one year commencing by Carson Cumberbatch PLC

from December 2003. Since re-scheduled. and PT Agro Indomas. 5,239,112 4,689,975

(c) The carrying amounts of the Group’s borrowings are denominated in the following currencies:

Balance as at Balance as at 31st March 31st March 2008 2007

US dollar 3,990,450 3,266,963 Sri Lankan Rs. 1,423,012 1,248,662 4,689,975 5,239,112

(d) Maturity Profile of Long-Term Borrowings The profile of the maturity of the long-term borrowings included in the Group’s Balance Sheet as at 31st March is shown in the table below:

2008 Total Bank Borrowings Finance Lease 31.03.08

Due within 1 year 1,145,966 103,615 1,249,581 1 to 2 years 1,635,014 61,067 1,696,081 2 to 5 years 275,704 – 275,704 Thereafter 2,182,428 2,182,428 – 5,239,112 5,403,794 164,682

78 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(e) Obligations under Finance Leases Group As at As at 31st March 31st March 2008 2007

Due in one year 123,613 185,126 Due in two years 150,743 65,520 Future lease payments 189,133 335,869 Less- Future finance charge (58,125) (24,451)

Present value of minimum lease payable 164,682 277,744 Less- Current portion of obligations due under finance lease (145,450) (103,615) 132,294 61,067

PT Agro Indomas: The subsidiary entered into lease agreements with PT Astra Sedaya Finance to lease out certain heavy equipment and motor vehicles with lease terms of three (3) years.The lease obligations are subject to interest rates ranging from 7.75% to 10.25% per annum.The subsidiary has options to purchase the leased assets for an amount equivalent to the residual value of the leased assets at the end of the lease terms.

PT Agro Bukit: The Subsidiary entered into lease agreements with PT Astra Sedaya Finance for certain heavy equipment and motor vehicles with lease terms of three (3) years. The lease obligations are subject to interest rates ranging from 8.85% to 11.67% per annum. The Subsidiary has options to purchase the leased assets for an amount equivalent to the residual value of the leased assets at the end of the lease terms.

36. Trade and Other Payables Group Company As at As at As at As at 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Current Trade payables 746,158 649,138 – – Other creditors including accrued expenses 1,574,665 1,270,007 2,217 1,706 Unclaimed dividend 31,878 19,326 34,609 19,772 1,951,023 21,032 2,355,432 21,989

Non-Current Rental deposits [Note 36 (a)] 23,767 25,003 – – Customer deposits [Note 36 (b)] 436,736 415,285 – – Long-term payable [Note 36 (c)] 198,415 1,162,941 – – Long-term creditors [Note 36 (d)] 70,618 – – –

658,918 1,673,847 – – 3,624,870 21,032 3,014,350 21,989

Term and condition of the above current Financial liabilities:

Trade payables are non-interest bearing and are normally settled on 60 to 90 day terms. Other payables are non-interest bearing and have an average term of six months. Interest payables are normally settled monthly throughout the financial year.

Annual Report 2007/08 Bukit Darah PLC 79 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

Group As at As at 31st March 31st March 2008 2007

(a) Rental Deposits Balance as at the beginning of the year 25,003 31,834 Receipts during the year 2,832 1,377 Refunds made during the year (8,208) (4,068) Balance as at the end of the year 25,003 23,767

The above rental and telephone deposits are repayable on termination of the tenancy agreements in the property sector.

(b) Customer Deposits Balance as at the beginning of the year 415,285 360,190 Receipts during the year 21,652 56,817 Refunds made during the year (1,722) (201) Balance as at the end of the year 415,285 436,736

Customer deposits are taken as security against the containers with the distributors in the beverage sector.

(c) Long-Term Payables Shareholder loans from minority shareholders include cash provided to the subsidiary in the previous financial year, pending capitalisation as part of the equity of the Subsidiary. During the current financial year, the shareholder loan was fully repaid on the basis that adequate funding is available within the subsidiary to undertake future development activities.

(d) Long-Term Creditors The long-term portion of accounts payable in the prior year represents sums owing to Modipalm Bhd. and PT Sumbar Abadi (contractors) on the construction of the new mill with 90 mt capacity in subsidiary in Indonesia which is due on 31st December 2009.The amount has been substantially paid and the remaining balance shall be repaid within one year.

37. Retirement Benefit Obligation The amounts recognised in the income statement are as follows; Group As at As at 31st March 31st March 2008 2007

Current service cost 36,288 19,870 Interest cost 4,572 3,144 Amortisation of past service costs - non-vested 3,048 (1,976) Immediate recognition of new entrants 3,430 2,513 Curtainment gain/loss (3,285) (12,976) Total employee benefit expense 20,266 34,362

80 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) The details of employee benefit liability at 31st March 2008 and 2007 are as follows: Group As at As at 31st March 31st March 2008 2007

Present value of unfunded obligations 116,981 85,529 Unrecognised past service cost - non-vested (258) (369) Unrecognised actuarial loss (8,612) (13,124)

103,599 76,548

The movement in the liabilities recognised in the balance sheet is as follows:

Balance as at the beginning of the year 76,548 60,264 Provision for the year 34,364 20,266 Payments made during the year (6,695) (5,671) Impact of exchange rate changes on conversions 1,689 (618) Balance as at the end of the year 76,548 103,599

A separate fund has not been established to accommodate the liability arising in respect of gratuity. The above gratuity provision of Rs. 34.36 mn is based on the assumptions of an actuarial valuation carried out by Messrs Actuarial & Management Consultants (Pvt) Ltd., as at 31st March 2008 for the Sri Lankan subsidiaries and the provision for Malaysian operations of the Group is based on the Malaysian Agricultural Producers’ Association/ National Union Plantation Workers’ agreement where gratuity is payable for those employees who have been in continuous employment for 5 years. Effective 1st April 2003 the Group’s Indonesian subsidiary, PT Agro Indomas started to recognise a provision for employee long service entitlements in accordance with Labour Law No. 13/2003 dated 25th March 2003. The current year’s provision is estimated using an independent actuary’s valuation.

Sri Lanka Indonesia - 2008

Discount rate 11% per annum 11.5% per annum Future salary increment rate 10% per annum 10% per annum Mortality rate A 1949-52 Mortality Table issued < 50 - 1980 by the Institute of Actuaries, London Retirement rate 55 - years 55 - years

38. Analysis of Group changes in net debt Net debt is current and non-current finance debt less cash equivalents.The net debt ratio is the ratio of net debt to total equity. The net debt ratio at 31st March 2008 was 31% (2007 - 35%). 2008 2007

Gross debt 8,752,209 7,448,756 cash and cash equivalents (1,170,785) (2,065,553) Net debt 6,277,971 6,686,656 Equity 21,259,634 17,571,527 Net debt ratio 35.73 31.45

Annual Report 2007/08 Bukit Darah PLC 81 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

1st April Cash Flow Transfers/ Other Non-Cash Currency 31st March 2007 Acquisition Movements Movements 2008

Cash in hand 639,422 1,038,897 – – 132 1,678,451 Overdrafts (604,015) (1,374,427) – – 13,568 (1,964,874) 35,407 (335,530) – – 13,700 (286,423) Short-term borrowings (1,652,015) 649,016 – – – (1,002,999) Long-term borrowings (4,689,975) 675,473 (1,273,573) 48,963 (5,239,112) Preference share capital (225,000) – – – – (225,000) Long-term lease creditor (277,751) – – (42,473) – (320,224) (6,809,334) 988,959 (1,273,573) (42,473) 62,663 (7,073,758) Cash on deposit 531,363 (144,261) – – – 387,102 Net Debt (6,277,971) 844,698 (1,273,573) (42,473) 62,663 (6,686,656)

1st April Cash Flow Transfers/ Other Non-Cash Currency 31st March 2006 Acquisition Movements Movements 2007

Cash in hand 262,759 369,205 – – 7,458 639,422 Overdrafts (144,151) (459,864) – – – (604,015)

118,608 (90,659) – – 7,458 35,407 Short-term borrowings (1,035,094) (616,921) – – – (1,652,015) Long-term borrowings (2,241,148) 1,683,455 (4,027,010) – (105,272) (4,689,975) Preference share capital (225,000) – – – – (225,000) Long-term lease creditor (244,507) 158,324 (139,967) (51,601) 0 (277,751)

(3,627,141) 1,134,199 (4,166,977) (51,601) (97,814) (6,809,334)

Cash on deposit 1,345,563 (814,200) – – – 531,363 Net Debt (2,281,578) 319,999 (4,166,977) (51,601) (97,814) (6,277,971)

39. Financial Instruments (a) Financial Risk Management Objectives and Policies The financial risk management policy seeks to ensure that adequate financial resources are available for the development of the businesses whilst managing its interest rate, foreign exchange, liquidity and credit risks within defined guidelines.

(b) Interest Rate Risk The Group’s exposure to the risk of changes in the market interest rates relates to the long-term & short term debt. The Group had no substantial long-term interest-bearing assets as at 31st March 2008. The investment in financial assets are mainly short-term in nature and they are not held for speculative purposes but have been mostly placed in fixed deposits or occasionally, in short-term commercial papers/deposits which yield better returns than cash at bank.

The Group manages its interest rate exposure by maintaining a prudent mix of fixed and floating rate borrowings. The Group actively reviews its debt portfolio, taking into account the investment holding period and nature of its assets. This strategy allows it to capitalise on cheaper funding in a low interest rate environment and achieve a certain level of protection against rate hikes.

As at present the Group has benefited from the reduction of LIBOR over the recent past, on all US Dollar borrowings which are pegged to the LIBOR.

82 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) The following table shows the interest rate and currency profile of the Group’s Bank Borrowings as at 31st March 2008.

Fixed Rate Floating Rate Weighted Average Weighted time for Amount Weighted Amount Average which rate is 31.03.2008 Average 31.03.2008 Total Currency Interest Rate fixed years Rs. Interest Rate Rs. Rs.

Long-Terms Borrowings US $ LIBOR+2.4% p.a 3,990,450 3,990,450 Sri Lankan Rupees PLR+1% p.a 350,531 350,531 Sri Lankan Rupees AWPLR + 1.5% 24,000 24,000 Sri Lankan Rupees AWPLR + 2.25% 680,000 680,000 Sri Lankan Rupees PLR+1% - PLR+2% 68,639 68,639 Sri Lankan Rupees 3% p.a 10 years 9,674 – 9,674 Sri Lankan Rupees 10.5% p.a 3 years 107,043 – 107,043 Sri Lankan Rupees 13.5% p.a 5 years 8,775 – 8,775

125,492 5,113,620 5,239,112

Short-Terms Borrowings Sri Lankan Rupees – 1,002,999 1,002,999

– PLR+1% p.a 1,964,874 1,964,874

Bank Overdrafts Sri Lankan Rupees Lease Creditors Indonesian Rupiah 8.85% to 11.67% p.a. 2 years 112,040 112,040 7.75% to 10.25% p.a. 2 years 52,642 52,642

164,682 164,682 164,682 290,174 8,246,175 8,371,667

(c) Foreign Exchange Risk In addition to Sri Lanka, the Group mainly operates in Indonesia and Malaysia and is exposed to United States Dollar, Indonesian Rupiah and Malaysian Ringgit. Foreign currency denominated assets and liabilities give rise to exchange rate exposure but this would be naturally hedged to some extent by the availability of revenue streams in US Dollars.

Exposure to transactional currencies other than functional currencies of the operating entities is reviewed periodically and is contained within acceptable levels.

(d) The monetary assets and monetary liabilities of the Group in currencies other than the functional currency of individual operating units are summarised below:

Monetary Assets/(Liabilities) as at 31st March 2008 Functional Currency Sri Lankan Total US dollar Sterling Euro Rupees 2008 Denominated Denominated Denominated Denominated Rs. ’000

Sri Lankan Rupees 29,485 591 13,362 – 43,438 Malaysian Ringgit 680 1,308 – 85,777 87,765 Indonesian Rupiah (Rp.) Total (Rs.) (3,721,358) – – (855,856) (4,577,214) Total in Denominated Currency Equivalents (3,691,193) 1,899 13,362 (770,079) (4,446,011)

Annual Report 2007/08 Bukit Darah PLC 83 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) Monetary Assets/(Liabilities) as at 31st March 2007 Functional Currency Sri Lankan Total US dollar Sterling Rupees 2007 Denominated Denominated Denominated Rs. ’000

Sri Lankan Rupees 5,624 3,542 – 9,166 Sterling – – 13,947 13,947 Malaysian Ringgit 1,184 115 38,756 39,940 Indonesian Rupiah (Rp.) (3,523,713) – (694,429) (4,165,439)

Total (Rs.) (3,516,905) 3,657 (641,726) (4,102,386)

Total in Denominated Currency Equivalents (32,295) 17 (641,726) –

(e) Commodity Pricing Risk The Company Subsidiary PT Agro Indomas (PTAI) is exposed to market risk, primarily involving changes in palm oil prices, and uses derivatives in connection with risk management activities. The Company (PTAI) does not hold or issue derivative financial instrument for trading purposes

a summary of derivative transaction as at 31st March 2008 is as follows: Notional Amount (Metric tonnes) Fair value Receivables

Transactions contacts due within 12 months 3,200 368,576,655 4,586,966

(f) Liquidity Risk The Group actively manages its operating and financing cash flows to ensure all refinancing, repayment and investment needs are satisfied. As part of its overall prudent liquidity management, the Group maintains sufficient levels of cash to meet its working capital requirements. In addition, the Group strives to maintain unutilised banking facilities of a reasonable level compared to its overall debt. The Group raises committed funding from both capital markets and financial institutions and prudently balance its debt maturity profile with a mix of short and longer term funding to achieve overall cost effectiveness.

Less than 3 to 12 Year ended 31st March 2008 On Demand 3 months months 1 to 2 years Thereafter Total

Interest bearing loans and borrowings 1,964,874 1,319,759 950,253 1,678,655 2,458,126 8,371,667 Redeemable Preference shares – – – 112,500 112,500 225,000 Other liabilities – – – – 460,503 460,503 Trade and other payables – 2,340,595 14,837 – – 2,355,432

1,964,874 3,660,354 965,090 1,791,155 3,031,129 11,412,602

Less than 3 to 12 Year ended 31st March 2007 On Demand 3 months months 1 to 5 years

Interest bearing loans and borrowings 604,015 1,870,809 656,384 1,363,660 2,728,881 7,223,749 Redeemable Preference shares – – – – 225,000 225,000 Other liabilities – – – 859,888 440,288 1,300,176 Trade and other payables – 1,938,471 12,552 – – 1,951,023

604,015 3,809,280 668,936 2,223,548 3,394,169 10,699,948

84 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(g) Credit Risk Credit risk or the risk of financial loss from the failure of customers or counter parties to discharge their financial and contractual obligations, is managed through the credit approvals, credit limits and monitoring procedures on an ongoing basis. If necessary, the Group may obtain collateral from counter parties as a means of mitigating losses in the event of default.

The Group trades only with recognised credit worthy third parties. It is the Group’s requirment that all customers who wish to trade on credit terms are subject to credit verification procedures that will ensure minimal exposure and active customer credit monitoring.

The maximum exposure to credit risk for the Group and for the Company was represented by the carrying amount to each financial asset; and in addition, in respect of derivatives, the notional amount as disclosed in the respective notes to financial statements.

40. Companies within the Group which are not audited by Messrs KPMG Ford, Rhodes, Thornton & Co. Watapota Investments PLC Ernst & Young - Sri Lanka Indo-Malay PLC ,, Equity Five Limited ,, Equity Seven Limited ,, Shalimar Developments Sdn. Bhd. Ernst & Young - Malaysia Agro Harapan Lestari Sdn. Bhd. ,, PT Agro Indomas Ernst & Young - Indonesia PT Agro Harapan Lestari ,,

41. Companies within the Group which have been consolidated on unaudited financial statements Subsidiaries Associates 1. ACW Insurance (Pvt) Ltd. 2. The Unit Trust Management Company (Private) Limited

42. Companies with different accounting periods Union Assurance PLC - 1st January to 31st December.

43. Capital Commitments Group As at As at 31st March 31st March 2008 2007

Oil Palm Plantations Approved and contracted for 108,228 339,076 108,228 339,076 Beverage Approved and contracted for 258,500 140,000 258,500 140,000 366,728 Total capital commitment 479,076

There were no material contracts for capital expenditure as at the Balance Sheet date other than the above.

Annual Report 2007/08 Bukit Darah PLC 85 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 44. Contingencies (a) A combined facility of US $ 55 mn was obtained by Group subsidiaries, PT Agro Bukit (PTAB) and PT Agro Indomas (PTAI) from Standard Chartered Bank, Singapore, which is secured on the project assets and movable assets of PTAI and PTAB in Indonesia. The combined facility included US $ 5 mn being a combined working capital facility.

(b) The contingent liabilities as at 31st March 2008 on corporate guarantees given to third parties by companies forming part of the Group in respect of facilities granted are as follows: Group As at As at 31st March 31st March 2008 2007

Carson Cumberbatch PLC 837 818 Lion Brewery (Ceylon) PLC 5.7 6.5 823.7 843.5

There were no material contingent liabilities as at the Balance Sheet date other than those disclosed above.

45. Re-classification of Comparative Figures The concept of authorised capital, issued share capital and par value in relation to share capital are not recognised by the Companies Act No. 07 of 2007. Therefore, the Company does not have a limited amount of authorised capital. The shares in issue does not have a par value. The total amount received by the Company or due and payable to Company in respect of the issue and calls of the shares are referred to as Stated Capital. The presentation on comparative information has been re-classified accordingly.

Certain comparative figures have been reclassified to conform to the classification and presentations as at 31st March, 2008.

46. Events occurring after the Balance Sheet date (a) After satisfying the solvency test in accordance with Section 57 of Companies Act, No. 07 of 2007, the Directors recommend a final dividend of Rs. 5.00 per share (2007- Rs. 1.00) on the ordinary shares for the year ended 31st March 2008 together with a resultant, participating cumulative preference dividend of Rs. 39.50 per share (2007 - Rs. 7.50) amounting to Rs. 57,125. mn (2007 - Rs. 11,353 mn), which is to be approved at the forthcoming Annual General Meeting.

Other than those disclosed above, no circumstances have arisen subsequent to the Balance Sheet date which require adjustments to or disclosure in the Financial Statements.

86 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) 47. Related party transactions Bukit Darah PLC (BDPLC) carries out transactions in the ordinary course of its business with parties who are defined as related parties in Sri Lanka Accounting Standard 30 ‘Related Party Disclosures’. The details of which are reported below:

(a) Transactions with/between Subsidiaries 1. Carson Cumberbatch PLC (CCPLC) Carson Cumberbatch PLC is a subsidiary of Bukit Darah PLC

(i) A summary of transaction of BDPLC with CCPLC are as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, D.C.R. Gunawardena, Tilak de Zoysa, P.C.P. Tissera, I. Paulraj Dividend Income 7,064 7,090

(ii) A summary of transactions of CCPLC with BDPLC and other Group of Companies is given below: Income Dividend Income Interest Income 2008 2007 2008 2007

Weniwella Investments Limited 1,644 139 – – Watapota Investments PLC 5,520 873 – – Mylands Investments Limited 2,282 172 931 620 Ceylon Guardian Investment Trust PLC 20,879 18,661 – – Ceylon Investment PLC 2,582 2,582 – – Rubber Investment Trust Limited 1 – – – Good Hope PLC 10,599 3,470 – – Indo-Malay PLC 6,258 1,777 – – Shalimar (Malay) PLC 141,982 13,822 – – Selinsing PLC 11,672 5,206 – – Ceylon Brewery PLC 41,952 55,866 – – Lion Brewery (Ceylon) PLC – 986 – – Equity One PLC 5,342 5,113 4,830 6,218 Shalimar Developments Sdn. Bhd. 24,815 18,172 – – Carsons Management Services (Private) Limited – 17,364 – 2,649 126,839 24,202 275,528 8,410

(iii) Expenses Computer Fees Dividend Paid 2008 2007 2008 2007

Carsons Management Services (Private) Limited 600 600 – – Bukit Darah PLC – 7,064 – 7,090 600 7,064 600 7,090

Annual Report 2007/08 Bukit Darah PLC 87 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(iv) Current Account Balance - 31st March 2008 2007

Amount due from/(Amount due to): Carsons Management Services (Private) Limited 82,595 (155,827) Equity One PLC 113,502 – Good Hope PLC (10,740) – Selinsing PLC (5,370) – Shalimar (Malay) PLC (5,370) – Leechman & Company (Private) Limited (43,414) (50,920) (199,241) 123,697

2. Carsons Management Services (Private) Limited (CMSL) Carsons Management Services (Private) Limited is subsidiary of The Bukit Darah Group.

(i) A summary of transactions of CMSL with BDPLC are as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, Management Fees 1,226 1,526 D.C.R. Gunawardena, Secretarial Fees 60 60 P.C.P. Tissera, K.C.N. Fernando Computer Fees 240 240 1,826 1,526

(ii) A summary of transactions of CMSL with other Group Companies are is below: Income Management Fees Secretarial Fees Computer Fees Technical Fees 2008 2007 2008 2007 2008 2007 2008 2007

Carson Cumberbatch PLC – – – – 600 600 – – Leechman & Company (Private)Limited 30 30 24 24 14 14 – – Weniwella Investments Limited. 351 324 14 14 30 30 – – Watapota Investments PLC 1,155 1,031 14 14 30 30 – – Mylands Investments Limited 442 396 14 14 30 30 – – Ceylon Guardian Investment Trust PLC 4,731 3,866 60 60 420 420 – – Ceylon Investment PLC 4,972 4,697 60 60 420 420 – – Rubber Investment Trust Limited 3,713 3,638 60 60 420 420 – – Good Hope PLC 1,685 3,570 15 60 60 240 – – Indo-Malay PLC 547 1,080 15 60 60 240 – – Shalimar Malay PLC 628 1,923 15 60 60 240 – – Selinsing PLC 2,056 5,092 15 60 60 240 – – Lion Brewery (Ceylon ) PLC 76,469 62,389 – – – – – – Equity One PLC 1,200 1,200 72 72 300 300 – – Equity Two PLC 600 600 72 72 180 180 – – Equity Three (Private) Limited 300 300 24 24 90 90 – – Equity Five Limited 600 600 42 42 90 90 – – Equity Seven Limited 600 600 42 42 90 90 – – Pegasus Hotels of Ceylon PLC – – 72 72 150 150 – – Equity Hotels Limited – – 42 42 – – – – Carsons Airline Services (Private) Limited – – 30 30 300 300 – – Guardian Fund Management Limited – – 36 36 30 30 – – PT Agro Harapan Lestari – – – – – – 3,692 –

Agro Harapan Lestari Sdn. Bhd. – – – – – – 9,883 –

100,079 91,336 738 918 3,434 4,154 13,575 –

88 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(iii) Expenses Management Fees Rent Paid 2008 2007 2008 2007

Equity Two PLC – – 8,938 8,880 Guardian Fund Management Limited 10,997 – 11,829 – 10,997 8,880 11,829 8,938

(iv) Current Account Balance - 31st March 2008 2007

Amount due from/(Amount due to): Carson Cumberbatch PLC. (82,595) 155,827 Pegasus Hotels of Ceylon PLC 71599 51,400 Equity Hotels Limited 21181 12,535 Carsons Airline Services (Private) Limited 5984 5,413 Equity Seven Limited. ) (219,250) (41,878 5,925 (25,709)

(v) Investment Investment made in Rights Issue 2008 2007

Carson Cumberbatch PLC – 161,342

3. PT Agro Harapan Lestari PT Agro Harapan Lestari is a subsidiary of Bukit Darah Group

(i) A summary of transactions of BDPLC with PT Agro Harapan Lestari are as follows: Name of the Common Director/s Nature of Transactions 2008 2007

P.C.P. Tissera There were no transactions during the period – –

(ii) A summary of transactions of PT Agro Harapan Lestari with other Group Companies is given below: Income *Management Fees 2008 2007

PT Agro Indomas 373,568 –

* Management Fees include Technical Services Fees,Sales Commission, and Cost Recoveries

(iii) Expenses Technical Fees 2008 2007

Carsons Management Services (Private) Limited – 3,692

Annual Report 2007/08 Bukit Darah PLC 89 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(iv) Current Account Balance - 31st March 2008 2007

Amount due from/(Amount due to): PT Agro Indomas 143,758 – PT Agro Bukit 16,016 –

4. Agro Harapan Lestari Sdn. Bhd. Agro Harapan Lestari Sdn. Bhd. is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Agro Harapan Lestari Sdn Bhdt is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, P.C.P. Tissera There were no transactions

H. Selvanathan, M. Selvanathan during the period – –

(ii) A summary of transactions of Agro Harapan Lestari Sdn. Bhd. with other Group Companies is given below: Income Management Fees* 2008 2007

PT Agro Indomas 234,474 PT Agro Bukit 54,255 Good Hope PLC 9,074 Selinsing PLC 11,794 Shalimar (Malay) PLC 4,808 Indo-Malay PLC 4,784

* Management Fees include Technical Services Fees,Sales commission, and Cost Recoveries.

(iii) Expenses Technical Fees 2008 2007

Carsons Management Services (Private) Limited – 9,883

(iv) Current Account Balance - 31st March 2008 2007

Amount due from/(Amount due to): PT Agro Indomas – 120,954 – 120,954

90 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

5. PT Agro Indomas (PTAI) PT Agro Indomas is a owned subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with PTAI are as follows: Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, P.C.P. Tissera There were no transactions during the period – –

(ii) A summary of transaction of PT Agro Indomas with other Group Companies is given below: Expenses Management Fees Dividend Paid 2008 2007 2008 2007

Shalimar Developments Sdn. Bhd. – – 97,479 94,284 PT Agro Harapan Lestari 373,568 – – –

Agro Harapan Lestari Sdn. Bhd. 234,474 – – –

608,042 – 97,479 94,284

(iii) Current Account Balance - 31st March 2008 2007

Amount due from/(Amount due to): Agro Harapan Lestari Sdn. Bhd. 120,954 – PT Agro Harapan Lestari – 143,758 – 264,712

6. PT Agro Bukit PT Agro Bukit is a subsidiary of The Bukit Darah Group.

(i) A summary of transactions of BDPLC with PT Agro Bukit is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, P.C.P. Tissera Investment made in Rights issue – 587,384

Shareholders Loan 1,189,965 1,189,965

1,189,965 1,777,349

(ii) A summary of transactions of the PT Agro Bukit with and other Group Companies is given below: Management Fees 2008 2007

PT Agro Harapan Lestari 16,016 –

Agro Harapan Lestari Sdn. Bhd. 54,255 –

70,271 94,284

(iii) Current Account Balance - 31st March 2008 2007

Amount due from/(Amount due to): PT Agro Harapan Lestari (14,686) –

Agro Harapan Lestari Sdn. Bhd. (54,255) –

(68,941) –

Annual Report 2007/08 Bukit Darah PLC 91 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

7. Good Hope PLC Good Hope PLC is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Good Hope PLC is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, I. Paulraj, There were no transactions

D.C.R. Gunawardena, P.C.P. Tissera during the period – –

(ii) A summary of transactions of Good Hope PLC with other Group Companies is given below: Income Dividend Income 2008 2007

Shalimar (Malay) PLC 5,867 571 Shalimar Developments Sdn. Bhd. 10,365 12,923 10,936 18,790

Expenses Management Fees Secretarial Fees Computer Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Agro Harapan Lestari Sdn. Bhd. 8,841 – – – – – – – Ceylon Investment PLC – – – – – – – 1,994 Mylands Investments Limited – – – – – – 306 100 Rubber Investment Trust Limited – – – – – – 6,091 1,994 Weniwella Investments Limited – – – – – – 88 28 Carsons Management Services (Private) Limited 1,661 3,570 87 60 62 240 – –

Carson Cumberbatch PLC – – – – – – 10,599 3,470

10,502 3,570 87 60 62 240 17,084 7,586

(iii) Current Account Balance - 31st March 2008 2007

Amount due from: Shalimar Developments Sdn. Bhd. 80,691 1,894 Carson Cumberbatch PLC – 10,740 1,894 91,431

8. Indo-Malay PLC Indo-Malay PLC is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Indo-Malay PLC is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, I. Paulraj, D.C.R. Gunawardena, P.C.P. Tissera There were no transactions

K.C.N. Fernando during the period – –

92 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(ii) A summary of transactions of Indo-Malay PLC with other Group Companies is given below: Income Dividend Income 2008 2007

Shalimar (Malay) PLC 4,189 608 Shalimar Developments Sdn. Bhd. 10,365 12,923 10,973 17,112

Expenses Management Fees Secretarial Fees Computer Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Weniwella Investments Limited – – – – – – 62 17 Mylands Investments Limited – – – – – – 137 39 Carsons Management Services (Private) Limited 537 1,081 88 60 63 240 – – Carson Cumberbatch PLC – – – – – – 6,258 1,777 Agro Harapan Lestari Sdn Bhd 4,784 – – – – – – –

Rubber Investment Trust Limited – – – – – – 2,905 825

5,321 1,081 88 60 63 240 9,362 2,658

(iii) Current Account Balance - 31st March 2008 2007

Amount due from: Shalimar (Malay) PLC 36,992 – Selinsing PLC – 7,700 44,692 –

9. Shalimar (Malay) PLC Shalimar (Malay) PLC is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Shalimar (Malay) PLC is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, I. Paulraj, D.C.R. Gunawardena, P.C.P. Tissera There were no transactions

K.C.N. Fernando during the period – –

(ii) A summary of transaction of Shalimar (Malay) PLC with other Group Companies is given below: Income Dividend Income 2008 2007

Equity One PLC 1,830 1,752 Equity Seven Limited 170,368 – Shalimar Developments Sdn. Bhd. 10,365 12,923 12,117 185,121

Annual Report 2007/08 Bukit Darah PLC 93 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

Expenses Management Fees Secretarial Fees Computer Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Indo-Malay PLC – – – – – – 4,189 608 Good Hope PLC – – – – – – 5,867 571 Carsons Management Services (Private) Limited 628 1,923 22 60 68 240 – – Selinsing PLC – – – – – – 20,318 1,977 Agro Harapan Lestari Sdn. Bhd. 4,808 – – – – – –

Carson Cumberbatch PLC – – – – – – 141,982 13,822

5,436 1,923 22 60 68 240 172,356 16,978

(iii) Current Account Balance - 31st March 2008 2007

Amount due from: Indo-Malay PLC 36,992 – Shalimar Developments Sdn. Bhd. 8,020 – Carson Cumberbatch PLC – 5,370

50,382 –

10. Selinsing PLC The Selinsing PLC is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Selinsing PLC is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, There were no transactions

I. Paulraj, D.C.R. Gunawardena during the period – –

(ii) A summary of transactions of the Selinsing PLC with other Group Companies is given below: Income Dividend Income 2008 2007

Shalimar (Malay) PLC 20,318 1,977 Shalimar Developments Sdn. Bhd. 10,365 12,923 12,342 33,241

Expenses Management Fees Secretarial Fees Computer Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 2,056 5,092 89 60 63 240 – – Rubber Investment Trust Limited – – – – – 6,625 2,954 Mylands Investments Limited – – – – – 182 81 Watapota Investments Limited – – – – – 1,583 706 Agro Harapan Lestari Sdn. Bhd. 11,794 – – – – – –

Carson Cumberbatch PLC – – – – – 11,672 5,206

13,850 5,092 89 60 63 240 20,062 8,947

94 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(iii) Current Account Balance - 31st March 2008 2007

Amount due from: Carson Cumberbatch PLC 5,370 – Shalimar Developments Sdn. Bhd. 107,688 27,861

Indo-Malay PLC 7,700 –

120,758 27,861

11. Good Hope Asia Holdings Limited Good Hope Asia Holdings Limited is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Good Hope Asia Holdings Limited is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

P.C.P. Tissera There were no transactions

during the period – –

(ii) A summary of transactions of Good hope Asia Holdings Limited with other group companies is given below: Investment Purchase of Shares 2008 2007

Shalimar Developments Sdn. Bhd. 439,640 – PT Agro Harapan Lestari 15,545 – Agro Harapan Lestari Sdn Bhd – 5,936 – 461,121

12. Ceylon Guardian Investment Trust PLC (CGITPLC) Ceylon Guardian Investment Trust PLC is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with CGITPLC is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

I. Paulraj, D.C.R. Gunawardena, P.C.P. Tissera There were no transactions

during the period – –

(ii) A summary of transactions of CGIT with other group companies is given below: Income Dividend Income 2008 2007

Ceylon Investment PLC 20,382 20,382 Rubber Investment Trust Limited 2,792 18,614 Ceylon Brewery PLC 2,805 3,739 Lion Brewery (Ceylon) PLC 4,025 – 46,760 25,979

Annual Report 2007/08 Bukit Darah PLC 95 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

Expenses Management Fees Secretarial Fees Computer Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 4731 3,866 60 60 420 420 – –

Carson Cumberbatch PLC – – – – – – 20,879 18,661

4731 3,866 60 60 420 420 20,879 18,661

(iii) Current Account Balance - 31st March 2008 2007

Amount due from/(Amount due to): Guardian Fund Management Limited 1,138 –

Rubber Investment Trust Limited – (84,800) – (83,662)

13. Ceylon Investment PLC (CIPLC) Ceylon Investment PLC is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with CIPLC is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

I. Paulraj, D.C.R. Gunawardena, P.C.P. Tissera There were no transactions

during the period – –

(ii) A summary of transactions of CIPLC with other group companies is given below: Income Dividend Income 2008 2007

Rubber Investment Trust Limited 2,787 18,580 Ceylon Brewery PLC 2,424 3,232 Lion Brewery (Ceylon) PLC 1,716 – 23,528 5,211

Expenses Management Fees Secretarial Fees Computer Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Ceylon Guardian Investment Trust PLC – – – – – – 20,382 20,382 Carsons Management Services (Private) Limited 4,972 4,698 60 60 420 420 – –

Carson Cumberbatch PLC – – – – – – 2,582 2,582

4,972 4,698 60 60 420 420 22,964 22,964

96 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

14. Rubber Investments Trust Limited (RITL) Rubber Investments Trust Limited is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with RITL is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

I. Paulraj, D.C.R. Gunawardena, P.C.P. Tissera There were no transactions

during the period – –

(ii) A summary of transactions of RITL with other group companies is given below: Income Dividend Income 2008 2007

Good Hope PLC 6,091 1,994 Indo-Malay PLC 2,905 825 Selinsing PLC 6,625 2,955 Guardian Fund Management Limited – 366 5,774 15,987

Expenses Management Fees Secretarial Fees Computer Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Ceylon Guardian Investment Trust PLC – – – – – – 2,792 18,614 Ceylon Investment PLC – – – – – – 2,787 18,580 Carsons Management Services

(Private) Limited 3,713 3,639 60 60 420 420 – –

3,713 3,639 60 60 420 420 5,579 37,194

(iii) Current Account Balance - 31st March 2008 2007

Amount due from: Ceylon Guardian Investment Trust PLC – 84,800

15. Watapota Investments PLC (WIPLC) WIPLC is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with WIPLC is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

I. Paulraj, D.C.R. Gunawardena, P.C.P. Tissera There were no transactions

during the period – –

Annual Report 2007/08 Bukit Darah PLC 97 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(ii) A summary of transactions of WIPLC with other group companies is given below: Income Dividend Income 2008 2007

Selinsing PLC 706 1,583

Expenses Management Fees Secretarial Fees Computer Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 1,155 1,031 14 14 30 30 – –

Carson Cumberbatch PLC – – – – – – 5,520 873

1,155 1,031 14 14 30 30 5,520 873

16. Weniwella Investments Limited Weniwella Investments Limited is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Weniwella Investment Limited is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

I. Paulraj, D.C.R. Gunawardena, P.C.P. Tissera D.C.R. Gunawardena (Alternate Director to There were no transactions

P.C.P. Tissera) during the period – –

(ii) A summary of transactions of Weniwella Investments Limited with other group companies is given below: Income Dividend Income 2008 2007

Good Hope PLC 88 28 Indo-Malay PLC 17 62 45 150

Expenses Management Fees Secretarial Fees Computer Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 351 324 14 14 30 30 – –

Carson Cumberbatch PLC – – – – – – 1,644 139

351 324 14 14 30 30 1,644 139

98 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

17. Mylands Investments Limited (MIL) Mylands Investments Ltd. is a subsidiary of Bukit Darah Group. (i) A summary of transactions of BDPLC with MIL is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

I. Paulraj, D.C.R. Gunawardena, P.C.P. Tissera There were no transactions

during the period – –

(ii) A summary of transactions of Myland Investments Limited with other group companies is given below: Income Dividend Income 2008 2007

Ceylon Investment PLC 3 3 Good Hope PLC 306 100 Selinsing PLC 182 81 Indo-Malay PLC 39 137 223 628

Expenses Management Fees Secretarial/Computer Fees Interest Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 442 396 44 44 – – – –

Carson Cumberbatch PLC – – – – – – 2,282 172

442 396 44 44 – – 2,282 172

18. Shalimar Developments Sdn. Bhd. Shalimar Developments Sdn. Bhd. is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Shalimar Developments Sdn. Bhd. is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, Dividend Income 12,865 10,365

D.C.R. Gunawardena, P.C.P. Tissera Investment made in Rights Issue – 25,983

12,865 36,348

(ii) A summary of transactions of Shalimar Developments Sdn. Bhd. with other group companies is given below: Income Dividend Income 2008 2007

PT Agro Indomas 94,284 97,479

Expenses Dividend Paid 2008 2007

Good Hope PLC 12,923 10,365 Indo-Malay PLC 12,923 10,365 Selinsing PLC 12,923 10,365 Carson Cumberbatch PLC 18,172 24,815 49,267 63,584

Annual Report 2007/08 Bukit Darah PLC 99 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(iii) Current Account Balance - 31st March 2008 2007

Amount due from : PT Agro Bukit – 179,950 Good Hope PLC (80,691) (1,894) Shalimar (Malay )PLC (8,020) – Selinsing PLC (27,861) (107,688) 150,195 (196,399)

(iv) Investment Investment made in Rights Issue 2008 2007

Carson Cumberbatch PLC – 71,624 Good Hope PLC – 24,823 Indo-Malay PLC – 28,655 Shalimar (Malay )PLC – 23,225 Selinsing PLC 24,305 – 172,632 –

19. Leechman & Company (Private) Limited Leechman & Company (Private) Limited is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Leechman & Company (Private) Limited is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan There were no transactions

during the period – –

(ii) A summary of transactions of Leechman & Company (Private) Limited with other group of companies are given below: Expenses Management Fees Secretarial Fees Computer Fees 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 30 30 24 24 14 14

(iii) Current Account Balance - 31st March 2008 2007

Amount due from: Carson Cumberbatch PLC 43,414 50,920

20. Ceylon Brewery PLC (CBPLC) Ceylon Brewery PLC is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with CBPLC is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, There were no transactions D.C.R. Gunawardena, P.C.P. Tissera during the period – –

S.K. Shah

100 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(ii) A summary of transactions of CBPLC with other group companies is given below: Income Dividend Income Preference Dividend Royalty Fees Income 2008 2007 2008 2007 2008 2007

Lion Brewery (Ceylon) PLC – 75,616 43,750 50,749 54,663 48,054

Expenses Dividend Paid 2008 2007

Ceylon Guardian Investment Trust PLC 2,805 3,739 Ceylon Investment PLC 2,424 3,232 Carson Cumberbatch PLC 55,866 41,952 62,837 47,181

21. Lion Brewery (Ceylon) PLC (LBCPLC) Lion Brewery Ceylon PLC is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with LBCPLC is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, There were no transactions

D.C.R. Gunawardena, S.K. Shah during period – –

(ii) A summary of transactions of LBCPLC with other Group Companies is given below:

Expenses Management Royalty Preference Ordinary Fees Fees Dividend Dividend 2008 2007 2008 2007 2008 2007 2008 2007

Ceylon Guardian Investment Trust PLC – – – – – – – 3,739 Ceylon Investment PLC – – – – – – – 3,232 Carsons Management Services (Private) Limited 76,469 62,389 – – – –

Ceylon Brewery PLC – – 54,663 48,054 43,750 50,749 – 75,616

76,469 62,389 54,663 48,054 43,750 50,749 – 82,587

22. Equity One PLC Equity One PLC. is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Equity One PLC is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena There were no transactions

during the period – –

Annual Report 2007/08 Bukit Darah PLC 101 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

(ii) A summary of transaction of Equity One PLC with other group companies is given below:

Income Dividend Income Rental Income Interest Income 2008 2007 2008 2007 2008 2007

Equity Five Limited – 3,240 – – – – Equity Seven Limited 170,368 7,361 – – – – Carsons Airline Services (Private) Limited – – 739 747 – – Equity Three (Private) Limited – – – – 617 1,325 Equity Developers (Private) Limited – – – – 931 – Equity Property Developers (Private) Limited – – – – 5,890 –

Equity Nine (Private) Limited – – – – 161 –

170,368 10,601 739 747 7,599 1,325

Expenses Management Secretarial/Computer Dividend Interest Fees Fees Paid Paid 2008 2007 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 1,200 1,200 372 372 300 300 – – Shalimar (Malay) PLC – – – – 1,830 1,752 – –

Carson Cumberbatch PLC – – – – 5,342 5,113 4,830 6,218

1,200 1,200 372 372 7,472 7,165 4,830 6,218

(iii) Investment Expenses Purchase Shares 2008 2007

Equity Developers (Private) Limited – 5,000 Equity Property Developers (Private) Limited – 100,000 Equity Nine (Private) Limited – 50,000

Carson Real Estate Management Services (Private) Limited 4,999 – 155,000 4,999

(iv) Current Account Balance - 31st March 2008 2007

Amount due from/(due to): Equity Three (Private) Limited 3,670 7,918 Equity Developers (Private) Limited 21,610 – Equity Property Developers (Private) Limited 128,486 – Equity Nine (Private) Limited 10,849 – Carson Real Estate Management Services (Private) Limited 17,555 – Carson Cumberbatch PLC (113,502) – Equity Two PLC – (23,919) 7,918 44,749

102 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

23. Equity Two PLC Equity Two PLC is a subsidiary of Bukit Darah Group.

(i) A summary of transaction of BDPLC with Equity Two PLC is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, P.C.P. Tissera, K.C.N. Fernando, N.Ramaiah, (resigned w.e.f. 20/11/2007) There were no transactions I. Paulraj (Alternate Director to N. Ramaiah) during the period – –

(ceased to be an alternate w.e.f. 20/11/2007)

(ii) A summary of transactions of Equity Two PLC with other Group Companies is given below:

Income Rental Income 2008 2007

Guardian Fund Management Limited 630 630 Carsons Management Services (Private) Limited 8,938 8,880

Carson Real Estate Management Services (Private) Limited 284 – 9,852 9,510

Expenses Management Fees Secretarial Fees Computer Fees 2008 2007 2008 2007 2008 2007

Carsons Management Services

(Private) Limited 600 600 72 72 180 180

(iii) Current Account Balance - 31st March 2008 2007

Amount due from Equity One PLC 23,919 –

24. Equity Three (Private) Limited Equity Three (Private) Limited is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Equity Three (Private) Limited is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

I. Paulraj, P.C.P. Tissera, K.C.N. Fernando There were no transactions

during the period – –

(ii) A summary of transactions of Equity Three (Private) Limited with other group companies is given below:

Expenses Management Fees Secretarial Fees Computer Fees Interest Paid 2008 2007 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 300 300 24 24 90 90 – –

Equity One PLC – – – – – – 617 1,325

300 300 24 24 90 90 617 1,325

Annual Report 2007/08 Bukit Darah PLC 103 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000) (iii) Current Account Balance - 31st March 2008 2007

Amount due to Equity One PLC 7,918 3,670

25. Equity Five Limited Equity Five Limited is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Equity Five Limited is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

I.Paulraj, D.C.R. Gunawardena, P.C.P. Tissera, There were no transactions K.C.N. Fernando during the period – –

(ii) A summary of transactions of Equity Five Limited with other Group Companies is given below:

Expenses Management Fees Secretarieal Fees Computer Fees Dividend Paid 2008 2007 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 600 600 42 42 90 90 – –

Equity One PLC – – – – – – – 3,240

600 600 42 42 90 90 – 3,240

26. Equity Seven Limited Equity Seven Limited is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Equity Seven Limited is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, P.C.P. Tissera, There were no transactions

K.C.N. Fernando during the period – –

(ii) A summary of transactions of The Equity Seven Limited . with other group companies is given below:

Expenses Management Fees Secretarieal Fees Computer Fees Interest Paid 2008 2007 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 600 600 42 42 90 90 – –

Equity One PLC – – – – – – 170,368 7,361

600 600 42 42 90 90 170,368 7,361

(iii) Current Account Balance - 31st March 2008 2007

Amount due from Carsons Management Services (Private) Limited 41,878 219,250

104 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

27. Equity Developers (Private) Limited Equity Developers (Private) Limited is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Equity Developers (Private) Limited is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, K.C.N. Fernando There were no transactions

during the period – –

(ii) A summary of transactions of Equity Developers (Private) Limited with other Group Companies is given below:

Current Account Balance - 31st March 2008 2007

Amount due to

Equity One PLC 21,610 –

28. Equity Property Developers (Private) Limited Equity Property Developers (Private) Limited. is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Equity Property Developers (Private) Limited is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, K.C.N. Fernando There were no transactions during the period – –

(ii) A summary of transaction of The Equity Property Developers (Private) Limited with other Group Companies is given below:

(iii) Current Account Balance - 31st March

2008 2007

Amount due to Equity One PLC 128,486 –

29. Equity Nine (Private) Limited Equity Nine (Private) Limited is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Equity Nine (Private) Limited is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, K.C.N. Fernando There were no transactions during the period – – (ii) Current Account Balance - 31st March

2008 2007

Amount due to Equity One PLC – 10,849

Annual Report 2007/08 Bukit Darah PLC 105 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

30. Carsons Real Estate Management Services (Private) Limited Carsons Real Estate Management Services (Private) Limited is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDPLC with Carsons Real Estate Management Services (Private) Limited is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, K.C.N. Fernando There were no transactions during the period – –

(ii) Current Account Balance - 31st March

2008 2007

Amount due to Equity One PLC – 17,555

31. Pegasus Hotels of Ceylon PLC Pegasus Hotels of Ceylon PLC is a subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDCL with Pegasus Hotels of Ceylon PLC is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, D.C.R. Gunawardena P.C.P. Tissera (Alternate Director to D.C.R. Gunawardena), K.C.N. Fernando (Alternate Director to There were no transactions M. Selvanathan) during the period – –

(ii) A summary of transactions of Pegasus Hotels of Ceylon PLC. with other Group Companies is given below:

Expenses Secretarial Fees Computer Fees As at As at As at As at 31st March 31st March 31st March 31st March 2008 2007 2008 2007

Carsons Management Services (Private) Limited (CMSL) 72 150 72 150

(iii) Current Account Balance - 31st March 2008 2007

Amount due to CMSL 71,599 51,400

106 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

32. Equity Hotels Limited Equity Hotels Limited is a fully owned subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDCL with Equity Hotels Limited is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, P.C.P. Tissera There were no transactions during the period – –

(ii) A summary of transactions of Equity Hotels Limited with other Group Companies is given below:

Expenses Secretarial Fees 2008 2007

Carsons Management Services

(Private) Limited 42 42

(iii) Current Account Balance - 31st March 2008 2007

Amount due to CMSL 21,181 12,535

33. Carsons Airline Services (Private) Limited (CASL) Carsons Airline Services (Private) Limited is a fully owned subsidiary of Bukit Darah Group.

(i) A summary of transactions of BDCL with CASL is as follows:

Name of the Common Director/s Nature of Transactions 2008 2007

H. Selvanathan, M. Selvanathan, There were no transactions D.C.R. Gunawardena during the period – –

(ii) A summary of transactions of CASL with other Group Companies is given below:

Expenses Management Fees Secretarieal Fees Computer Fees Interest Paid 2008 2007 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited – – 30 30 300 300 – –

Equity One PLC – – – – – – 739 747

34. Guardian Fund Management Limited (GFM) Guardian Fund Management Limited is a subsidiary of Bukit Darah Group.

A summary of transactions of BDCL with GFM is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

I.Paulraj, D.C.R. Gunawardena, P.C.P. Tissera There were no transactions during the period – –

Annual Report 2007/08 Bukit Darah PLC 107 Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

A summary of transactions of The Guardian Fund Management Limited with other Group Companies is given below: Income Management Fees 2008 2007

Carsons Management Services (Private) Limited 10,997 11,829

Expenses Secretarial Fees Computer Fees Rent Paid 2008 2007 2008 2007 2008 2007

Carsons Management Services (Private) Limited 36 36 30 30 – –

Equity Two PLC – – – – 630 630

36 36 30 30 630 630

Current Account Balance - 31st March 2008 2007

Amount due to:

Guardian Investment Trust PLC 1,138 –

(a) Transaction with Associates 1. Union Assurance PLC (UAPLC) Union Assurance PLC is a associate of Bukit Darah Group.

A summary of transactions of BDPLC with UAPLC is as follows: Name of the Common Director/s Nature of Transactions 2008 2007

D.C.R. Gunawardena, P.C.P. Tissera Dividend Income 2 –

A summary of transactions of UAPLC with other Group Companies is given below: Income Insurance Premium 2008 2007

Carsons Management Services (Private) Limited 3,865 4,078 Equity One PLC 2,337 2,333 Equity Two PLC 2,008 2,012 Equity Three (Private) Limited 1,316 1,315 Equity Five Limited 478 477 Equity Seven Limited – 429 Carsons Real Estate Management Services (Private) Limited 29 – Lion Brewery (Ceylon) PLC 68,553 65,684 Carsons Airline Services (Private) Limited 122 81 Pegasus Hotels of Ceylon PLC 2,169 2,692 Equity Hotels Limited 715 – 79,816 80,877

108 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(Amounts expressed in Sri Lankan Rs. ’000)

Expenses Dividend Paid Insurance Claims 2008 2007 2008 2007

Carsons Management Services (Private) Limited – – 1,082 594 Ceylon Investment PLC 4,086 – – – Ceylon Guardian Investment Trust PLC 4,617 – – – Pegasus Hotels of Ceylon PLC – – 195 47,000 Equity Hotels Limited – – – 211 Equity One PLC – – 70 146 Equity Three (Private) Limited – – 13 – Carsons Airline Services (Private) Limited – – 89 –

Carson Cumberbatch PLC 8,419 – – –

17,122 – 1,449 47,951

2. The Unit Trust Management Company (Private) Limited The Unit Trust Management Company (Private) Limited is an associate of Bukit Darah Group.

A summary of transactions of BDPLC with The Unit Trust Management Company (Private) Limited are as follows: Name of the Common Director/s Nature of Transactions 2008 2007

M. Selvanathan, D.C.R. Gunawardena There were no transactions (Alternate Director to M. Selvanathan) during the period – –

A summary of transactions of the Unit Trust Management Company (Private) Limited and other Group of Companies is given below: Expenses Dividend Paid Secretarial Fees 2008 2007 2008 2007

Carsons Management Services (Private) Limited – 90 – 90

Carson Cumberbatch PLC – 743 – –

– 833 – 90

(b) Transaction with Key Management Personnel of the Group The compensation paid to Key Management Personnel (Board of Directors) are disclosed in Note 13 (Page 47).

(c) Transaction with other Entities having Common Directors Equity Property Developers (Private) Limited with Asian Cotton Mills Limited.

Name of the Common Director/s Nature of Transactions 2008 2007

V. Malalasekera (Director of CCPLC) Purchase of land – 508,800

There were no material related party transaction other than those disclosed above.

Annual Report 2007/08 Bukit Darah PLC 109 Notes to the Financial Statements

48. Comparative information (a) The presentation and classification of the follwing items in the Financial Statements are amended to ensure the comparability with current year. Current As Reported classification Presentation Previously 2007 2007

Property, plant & equipment 11,825,786 13,693,589 (1,867,803) Capital Work in Progress 1,867,803 – 1,867,803

Intangible assets 291,275 609,185 (317,910) Prepaid Lease payment 317,910 – 317,910

Investments in Associates 350,117 669,658 (319,541) Long-term investments 2,278,884 1,959,343 319,541

Trade and other payables 1,951,023 2,051,270 (100,247) Income tax payable 153,976 53,729 100,247

Share of net results of associates 22,797 26,819 (4,022) Income tax expenses 691,857 695,879 (4,022)

(b) (a)The authorised capital and par value concept in relation to share capital were abolished by the companies Act No. 07 of 2007.

Therefore the Company does not have a limited amount of authorised capital. The amount of issued shares does not have a par value.

The total amount received by the Company or due and payable to company in respect of the issue and calls of the shares are referred to as Stated Capital.

The presentation of comparative information has been restated accordingly.

110 Annual Report 2007/08 Bukit Darah PLC Five Year Summary

(Amounts expressed in Sri Lankan Rs. ’000) Group 31st March 31st March 31st March 31st March 31st March For the year ended 2008 2007 2006 2005 2004

Operating Results Revenue 15,583,756 9,620,950 8,222,898 6,207,111 892,872 Profit before taxation 5,316,352 2,791,801 2,590,041 4,051,204 470,575 Income tax expenses 1,442,871 691,857 509,173 227,310 96,703 Profit for the year 3,873,481 2,099,944 2,080,868 3,823,894 373,872 Minority interest - equity 2,382,821 1,288,303 1,089,839 834,249 143,347 Profit attributable to the shareholders of Bukit Darah PLC 1,490,660 811,641 991,029 2,989,645 230,525

CAPITAL EMPLOYED Stated capital 101,804 101,804 101,804 101,804 101,804

Reserves 8,745,584 7,212,998 5,798,635 4,409,586 1,603,529 8,847,388 7,314,802 5,900,439 4,511,390 1,705,333

Minority shareholders equity interest 12,412,246 10,256,725 8,830,784 6,611,546 6,142,908

Short-term and long-term borrowings 8,371,667 7,223,749 3,618,771 3,104,601 3,955,623

29,631,301 24,795,276 18,349,994 14,227,537 11,803,864

ASSETS EMPLOYED Non-current assets 29,315,069 25,718,546 19,365,993 14,037,349 13,064,431

Current assets 6,750,701 4,611,526 3,887,410 3,878,876 1,571,388

36,065,771 30,330,072 23,253,403 17,916,225 14,635,819

Current liabilities - excluding borrowings (3,602,869) (2,104,999) (1,825,339) (1,351,425) (831,335) Non-current liabilities (658,918) (1,673,847) (1,431,096) (853,441) (816,570)

Deferred liabilities (2,172,683) (1,755,950) (1,646,974) (1,483,822) (1,184,050)

29,631,301 24,795,276 18,349,994 14,227,537 11,803,864 CASH FLOW STATEMENTS Net cash inflows/(outflows) from operating activities 3,696,214 827,465 1,100,990 1,457,930 14,782 Net cash used in investing activities (2,650,409) (4,443,055) (2,539,896) 2,588,468 (357,355) Net cash generated from/(used in)

financing activities (862,879) 2,075,683 (497,435) (1,022,745) 413,355 Net (decrease)/increase in cash &

cash equivalents 182,926 (1,539,907) (1,936,341) 3,023,653 70,782 OPERATIONAL RATIOS Return on ordinary shareholders’ funds (%) 16.77 10.99 16.54 9.85 13.52 Equity to total assets (%) 58.95 57.93 63.35 62.08 53.62 Asset turnover (times) 0.43 0.32 0.35 0.35 0.06 Revenue growth (%) 61.98 17.00 32.48 N/A N/A Asset growth (%) 18.91 30.43 29.79 22.41 N/A Revenue to capital employed (times) 0.53 0.39 0.45 0.44 0.08 No. of employees 6581 5576 4726 3489 N/A Revenue per employess (Rs. ‘000) 2368 1725 1740 1779 N/A

Annual Report 2007/08 Bukit Darah PLC 111 Five Year Summary

(Amounts expressed in Sri Lankan Rs. ’000)

31st March 31st March 31st March 31st March 31st March For the year ended 2008 2007 2006 2005 2004

DEBT & GEARING RATIOS Interest cover (times) 7.39 6.24 7.41 3.29 0.96 Debt equity ratio (%) 39.38 41.11 24.57 27.91 50.40 Gearing ratio (%) 28.25 29.13 19.72 21.82 33.51

LIQUIDITY RATIOS Current ratio (times) 0.86 0.89 1.00 1.55 0.89

INVESTOR RATIOS Dividend cover (times) 29.67 14.61 9.02 1.11 0.00 Dividends per share (Rs.) 5.00 5.50 10.50 40.00 0.00 Rate of dividend (%) 50 55 105 400 0 Market value per share (Rs.) 1400 1339 1145 810 1453 Market capitalisation (Rs. ‘000) 14,000,000 13,390,000 11,445,000 8,100,000 14,525,000 Earnings per share (Rs.) 148.34 80.37 94.70 44.40 22.50 Price earnings ratio (times) 9.44 16.66 12.09 18.24 64.56 Net assets per ordinary share (Rs.) 884.56 731.30 589.86 450.96 170.35

Note: Carson Cumberbatch Group consolidated with effect from February 2004.

112 Annual Report 2007/08 Bukit Darah PLC Statement of Value Added

(Amounts expressed in Sri Lankan Rs. ’000)

Group 31st March 31st March 31st March 31st March 31st March For the year ended 2008 2007 2006 2005 2004

Revenue 15,583,756 9,620,950 8,222,898 6,207,111 892,872 Exceptional gain – – – 2,487,223 –

Other income 27,089 76,512 75,350 137,713 1,111 15,610,845 9,697,462 8,298,248 8,832,047 893,983

Bought in materials and services (3,533,133) (2,023,339) (1,052,260) (1,231,448) (395,386)

12,077,712 7,674,123 7,245,988 7,600,599 498,597 % % % % % Distributed as follows: To employees as remuneration 1,398,321 12 976,170 13 737,124 10 632,901 8 53,848 11

To Government as taxation Sri Lanka 2,139,016 18 1,867,659 24 1,652,474 23 1,247,584 16 4,344 1 Overseas 1,134,375 9 298,071 4 186,359 3 185,042 2 – –

To providers of capital as finance cost on loans 832,961 7 539,058 7 357,906 5 720,744 9 37,723 8 as minority interest 2,382,821 20 1,288,303 17 1,089,839 15 834,249 11 143,346 29 as dividend to Shareholders 57,269 0 62,899 1 120,054 2 428,910 6 5,947 1

Retained in the business as depreciation 2,408,978 20 1,992,591 26 1,445,970 20 292,157 4 317 –

as retained profits 1,723,971 14 649,372 8 1,656,262 23 3,259,012 43 253,072 51

12,077,712 100 7,674,123 100 7,245,988 100 7,600,599 99 498,597 101

The Statement of Value Added shows the quantum of wealth generated by the operations of the Group and its applications.

Note 1. The Statement of Value Added shows the quantum of wealth generated by the activities of the Companies within the Group, excluding its Associate Companies and its application.

2. Value Added Tax, Economic Services Charge and Social Responsibility Levy are excluded in arriving at the above revenue. Therefore, total tax liability to the Sri Lankan Government during the year included the following:

2008 2007 2006 2005

Economic Services Charges 22,851 17,863 13,794 8,705 Value Added Tax 1,110,694 882,521 819,900 555,477 Social Responsibility Levy 981 605 73 898

Excise Duty included under net sales above 2,078,929 1,779,497 1,606,263 1,209,093 3,213,455 2,680,486 2,440,030 1,774,173

Income tax 36,255 69,694 32,344 28,888

Total taxes paid to Government of Sri Lanka 3,249,710 2,750,180 2,472,374 1,803,061

Annual Report 2007/08 Bukit Darah PLC 113

US $ Financials

Preparation of US Dollar Financials

The Financial Statements of the Group are reported in Sri Lankan Rupees. The translation of the Sri Lankan Rupees amounts into US Dollars is included solely for the convenience of Shareholders, Investors, Bankers and other users of Financial Statements. US Dollar Financials do not form part of the Audited Financial Statements of the Company. Income Statements

(All figures in Notes are in US Dollars unless otherwise stated)

Group For the year ended 31st March 2008 2007

Revenue 141,221,169 91,124,740 Direct operating expenses (45,919,142) (61,308,410) 45,205,598 79,912,759 Changes in fair value of biological assets 7,060,381 3,278,945 Change in fair value of investment properties – 1,870,894 Gain/(loss) on mark to market valuation of short-term investments (408,020) 1,460,892 Other income 245,483 724,683 Distribution expenses (13,790,739) (7,018,479) Administrative expenses (16,186,543) (12,528,140) Other operating expenses (1,111,707) (1,075,804) 31,882,686 Profit from operations 55,757,517 Finance expenses (7,548,355) (5,105,683) Foreign exchange loss (550,407) (354,771) Profit before net results of Associate 47,854,391 26,226,596 Share of net results of Associate 215,924 322,791 Profit before taxation 48,177,182 26,442,520 Taxation - Current taxation (10,608,337) (3,483,283) Deferred taxation (3,069,634) (2,467,068) (6,552,917) (13,075,406) 19,889,603 Profit for the period 35,101,776 Profit Attributable to Equity holders of the parent 13,508,473 7,687,453 Minority shareholders 12,202,150 21,593,303 19,889,603 35,101,776 Exchange Rates 110.35 105.58

Figures in brackets indicate deductions.

116 Annual Report 2007/08 Bukit Darah PLC Balance Sheets

(All figures in Notes are in US Dollars unless otherwise stated) Group As at 31st March 2008 2007

Assets Non-Current Assets Property, plant & equipment 127,904,070 108,593,076 Capital Work in Progress 8,412,082 17,151,543 Investment properties 12,711,609 12,587,502 Intangible assets 5,643,115 5,593,985 Biological assets 84,769,884 67,110,358 Investment in associates 3,654,940 3,215,035 Long-term investments 26,462,837 20,926,391 Deferred tax asset 988,742 2,254,808 Total non-current assets 271,813,345 236,166,632

Current Assets Inventories 20,789,420 14,051,763 Trade and other receivables 19,449,439 11,820,450 Short-term investments 3,202,479 5,723,205 Short-term deposits 3,589,263 4,879,366 Cash in hand and at bank 5,871,644 15,562,828 Total current assets 42,346,428 62,593,429 Total assets 334,406,774 278,513,060

Equity Stated capital 1,099,153 1,099,153 Capital reserves 10,533,621 9,626,905 Revenue reserves 56,443,843 70,401,418 Total equity attributable to equity holders of the parent 82,034,192 67,169,901 94,184,803 Minority shareholders’ equity interest 115,088,048 Total equity 197,122,240 161,354,704

Non-Current Liabilities Long-term borrowings 38,518,433 37,978,246 Trade and other payables 6,109,578 15,370,496 Retirement benefit obligations 960,584 702,920 Deferred tax liability 15,421,506 19,184,831 Total non-current liabilities 64,773,426 69,473,168

Current Liabilities Trade and other payables 21,839,889 17,915,730 Current tax liabilities 11,566,407 1,413,921 Long-term borrowings falling due within one year 11,586,287 7,639,008 Short-term borrowings 9,299,944 15,170,018 Bank overdraft 5,546,511 18,218,581 Total current liabilities 47,685,188 72,511,108 Total liabilities 117,158,356 137,284,534 Total equity and liabilities 334,406,774 278,513,060

Exchange Rates 107.85 108.90

This information does not constitute a full set of Financial Statements in compliance with SLAS.

Annual Report 2007/08 Bukit Darah PLC 117 Notes to the Financial Statements

(All figures in Notes in US Dollars unless otherwise stated)

1. Revenue Segmental Information (b) By Industry Segment Revenue Profit from Operations Finance expenses Profit before Taxation Income Expenses Profit for the year For the year ended 31st March 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007

Investment Holdings & Financial Services 22,094,599 23,092,158 9,813,421 13,920,316 3,179,701 2,106,270 6,956,529 12,082,780 329,832 301,639 6,626,697 11,781,142 Oil Palm Plantations 81,848,817 37,017,390 44,004,468 18,240,756 2,260,770 2,332,288 41,388,926 15,305,269 11,993,666 5,198,655 29,395,261 10,106,614 Beverage 47,363,960 37,632,441 3,484,078 1,345,076 2,083,951 591,845 1,400,109 753,230 (220,562) 621,737 1,620,671 131,493 Real Estate 1,238,985 925,999 856,457 2,400,815 87,123 17,418 769,334 2,383,368 138,985 422,655 630,349 1,960,712 Hotels 1,485,029 1,132,894 (146,343) (288,663) 137,218 114,586 (283,552) (403,239) – – (283,552) (403,239) Airlines 70,323 107,662 11,708 34,476 662 2,208 11,038 32,260 2,774 3,628 8,265 28,632 Management Services 7,662,673 1,180,328 2,619,990 (158,771) 31,744 170,297 2,588,264 (329,068) 830,711 4,603 1,757,551 (333,671) ` 161,764,386 101,088,872 60,643,779 35,494,005 7,781,169 5,334,912 52,830,648 29,824,600 13,075,406 6,552,917 39,755,242 23,271,683 Intra-group transactions (14,883,842) (5,352,226) (4,886,262) (3,611,318) (232,814) (229,229) (4,653,466) (3,382,080) (4,653,466) (3,382,080) Share of associate companies’ revenue (5,659,375) (4,611,906) – – – – – – – – – – ` 141,221,169 91,124,740 55,757,517 31,882,686 7,548,355 5,105,683 48,177,182 26,442,521 13,075,406 6,552,917 35,101,776 19,889,603

Investment Holdings & Financial Services Oil Palm Plantations Beverage Real Estate Hotels Airlines Management Services Group As at 31st March 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007

Segment Assets Property, plant & equipment/ biological assets/intangible assets/ investment properties 2,237,413 2,242,553 190,479,054 162,934,784 21,621,595 20,969,109 18,228,447 18,132,332 6,190,181 6,246,428 4,482 4,959 679,651 506,299 239,440,763 211,036,465 Long-term investments 23,146,585 21,142,886 – – 6,906,287 2,934,261 64,905 64,279 – – – – – – 30,117,777 24,141,426 Deferred assets – – 2,224,580 988,742 – – – – – – – – 30,224 – 2,254,808 988,742 Current assets 6,868,957 9,209,578 27,135,642 11,866,088 16,827,714 11,647,695 9,858,034 8,990,726 377,181 281,028 29,050 43,223 1,496,850 308,090 62,593,429 42,346,427 `

Total segmental assets 32,252,955 32,595,016 219,839,277 175,789,614 45,355,596 35,551,065 28,151,386 27,187,337 6,567,362 6,527,456 33,472 48,182 2,206,725 814,389 334,406,777 278,513,060

Segment Liabilities Interest bearing borrowings 470,848 2,986,970 32,066,231 27,214,490 150,153 719,642 5,239,703 6,388,200 591,497 668,944 – – – – 38,518,433 37,978,246 Long-term creditors – – 1,839,731 11,327,447 4,049,476 3,813,453 220,371 229,596 – – – – – – 6,109,578 15,370,496 Deferred tax liabilities – – 13,859,981 10,142,516 3,859,750 3,832,443 1,464,757 1,445,712 – – – – 343 836 19,184,831 15,421,506 Retirement benefit obligations – – 501,344 354,692 180,862 199,541 34,214 33,453 26,908 18,172 4,172 192 213,083 96,869 960,584 702,920

Current liabilities 18,027,510 13,491,157 32,752,017 24,112,002 17,807,900 8,900,725 1,676,783 644,205 459,991 352,149 10,765 18,825 1,776,143 166,124 72,511,108 47,685,188 ` Total segmental liabilities 18,498,359 16,478,127 81,019,305 73,151,148 26,048,141 17,465,803 8,635,828 8,741,166 1,078,396 1,039,265 14,937 19,017 1,989,569 263,829 137,284,534 117,158,356

Other Information Total cost incurred during the period to acquire Property, plant & equipment – – 11,509,950 26,806 1,567,839 1,188,085 24,404 12,948 52,877 217,645 118 332 372,469 42,461 13,527,657 1,488,276 Intangible assets – 1,529,485 213,240 733 87,911 147 – – – 36 – – – – 301,151 1,530,400 Biological assets/investment property – – 11,323,424 13,776,738 – – – – – – – – – – 11,323,424 13,776,738 Depreciation for the year (property plant/intangible assets) – – 4,445,745 3,039,174 1,145,510 1,111,896 84,667 87,611 139,909 162,427 616 1,885 209,397 165,060 6,025,845 4,568,053 Salaries and wages 43,453 39,543 7,349,062 5,657 1,767,875 2,006 123,126 104 324,948 320 28,908 32 2,722,927 896 12,360,299 48,558 Gratuity – – 153,185 104,291 13,611 42,110 5,247 7,123 13,013 95 3,879 909 122,456 37,422 311,391 191,949

118 Annual Report 2007/08 Bukit Darah PLC Notes to the Financial Statements

(All figures in Notes in US Dollars unless otherwise stated)

1. Revenue Segmental Information (b) By Industry Segment Revenue Profit from Operations Finance expenses Profit before Taxation Income Expenses Profit for the year For the year ended 31st March 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007

Investment Holdings & Financial Services 22,094,599 23,092,158 9,813,421 13,920,316 3,179,701 2,106,270 6,956,529 12,082,780 329,832 301,639 6,626,697 11,781,142 Oil Palm Plantations 81,848,817 37,017,390 44,004,468 18,240,756 2,260,770 2,332,288 41,388,926 15,305,269 11,993,666 5,198,655 29,395,261 10,106,614 Beverage 47,363,960 37,632,441 3,484,078 1,345,076 2,083,951 591,845 1,400,109 753,230 (220,562) 621,737 1,620,671 131,493 Real Estate 1,238,985 925,999 856,457 2,400,815 87,123 17,418 769,334 2,383,368 138,985 422,655 630,349 1,960,712 Hotels 1,485,029 1,132,894 (146,343) (288,663) 137,218 114,586 (283,552) (403,239) – – (283,552) (403,239) Airlines 70,323 107,662 11,708 34,476 662 2,208 11,038 32,260 2,774 3,628 8,265 28,632 Management Services 7,662,673 1,180,328 2,619,990 (158,771) 31,744 170,297 2,588,264 (329,068) 830,711 4,603 1,757,551 (333,671) ` 161,764,386 101,088,872 60,643,779 35,494,005 7,781,169 5,334,912 52,830,648 29,824,600 13,075,406 6,552,917 39,755,242 23,271,683 Intra-group transactions (14,883,842) (5,352,226) (4,886,262) (3,611,318) (232,814) (229,229) (4,653,466) (3,382,080) (4,653,466) (3,382,080) Share of associate companies’ revenue (5,659,375) (4,611,906) – – – – – – – – – – ` 141,221,169 91,124,740 55,757,517 31,882,686 7,548,355 5,105,683 48,177,182 26,442,521 13,075,406 6,552,917 35,101,776 19,889,603

Investment Holdings & Financial Services Oil Palm Plantations Beverage Real Estate Hotels Airlines Management Services Group As at 31st March 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007

Segment Assets Property, plant & equipment/ biological assets/intangible assets/ investment properties 2,237,413 2,242,553 190,479,054 162,934,784 21,621,595 20,969,109 18,228,447 18,132,332 6,190,181 6,246,428 4,482 4,959 679,651 506,299 239,440,763 211,036,465 Long-term investments 23,146,585 21,142,886 – – 6,906,287 2,934,261 64,905 64,279 – – – – – – 30,117,777 24,141,426 Deferred assets – – 2,224,580 988,742 – – – – – – – – 30,224 – 2,254,808 988,742 Current assets 6,868,957 9,209,578 27,135,642 11,866,088 16,827,714 11,647,695 9,858,034 8,990,726 377,181 281,028 29,050 43,223 1,496,850 308,090 62,593,429 42,346,427 `

Total segmental assets 32,252,955 32,595,016 219,839,277 175,789,614 45,355,596 35,551,065 28,151,386 27,187,337 6,567,362 6,527,456 33,472 48,182 2,206,725 814,389 334,406,777 278,513,060

Segment Liabilities Interest bearing borrowings 470,848 2,986,970 32,066,231 27,214,490 150,153 719,642 5,239,703 6,388,200 591,497 668,944 – – – – 38,518,433 37,978,246 Long-term creditors – – 1,839,731 11,327,447 4,049,476 3,813,453 220,371 229,596 – – – – – – 6,109,578 15,370,496 Deferred tax liabilities – – 13,859,981 10,142,516 3,859,750 3,832,443 1,464,757 1,445,712 – – – – 343 836 19,184,831 15,421,506 Retirement benefit obligations – – 501,344 354,692 180,862 199,541 34,214 33,453 26,908 18,172 4,172 192 213,083 96,869 960,584 702,920

Current liabilities 18,027,510 13,491,157 32,752,017 24,112,002 17,807,900 8,900,725 1,676,783 644,205 459,991 352,149 10,765 18,825 1,776,143 166,124 72,511,108 47,685,188 ` Total segmental liabilities 18,498,359 16,478,127 81,019,305 73,151,148 26,048,141 17,465,803 8,635,828 8,741,166 1,078,396 1,039,265 14,937 19,017 1,989,569 263,829 137,284,534 117,158,356

Other Information Total cost incurred during the period to acquire Property, plant & equipment – – 11,509,950 26,806 1,567,839 1,188,085 24,404 12,948 52,877 217,645 118 332 372,469 42,461 13,527,657 1,488,276 Intangible assets – 1,529,485 213,240 733 87,911 147 – – – 36 – – – – 301,151 1,530,400 Biological assets/investment property – – 11,323,424 13,776,738 – – – – – – – – – – 11,323,424 13,776,738 Depreciation for the year (property plant/intangible assets) – – 4,445,745 3,039,174 1,145,510 1,111,896 84,667 87,611 139,909 162,427 616 1,885 209,397 165,060 6,025,845 4,568,053 Salaries and wages 43,453 39,543 7,349,062 5,657 1,767,875 2,006 123,126 104 324,948 320 28,908 32 2,722,927 896 12,360,299 48,558 Gratuity – – 153,185 104,291 13,611 42,110 5,247 7,123 13,013 95 3,879 909 122,456 37,422 311,391 191,949

Annual Report 2007/08 Bukit Darah PLC 119 Notes to the Financial Statements

(All figures in Notes in US Dollars unless otherwise stated)

1. REvenue (Contd.) Segmental Information (Contd.) (c) By Geographical Location

Sri Lanka Malaysia Indonesia Singapore united Kingdom Group For the year ended 31st March 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007

Revenue 58,141,033 53,729,627 5,830,349 2,331,228 77,249,787 35,046,240 – – – 17,645 141,221,169 91,124,740 Profit from operations 8,084,459 13,240,993 5,391,309 1,159,670 42,284,259 17,491,675 (2,510) – – (9,651) 55,757,517 31,882,686 Finance cost (5,287,585) (2,773,395) – (303) (2,260,770) (2,331,985) – – – – (7,548,355) (5,105,683) Foreign exchange gain/(loss) – 52,813 – – (354,771) (603,220) – – – – (354,771) (550,407) Share of associate – – – – – – – – – – – – companies’ profits 215,924 – – – – 215,924 322,791 – – – – 322,791 Profit before taxation 10,736,335 1,159,367 14,556,469 – (9,651) 26,442,520 3,119,665 5,391,309 39,668,718 (2,510) – 48,177,182 Taxation (1,418,915) (233,965) (11,554,010) (4,900,038) – – (6,552,917) (260,788) (1,260,607) – – (13,075,406) Net profit after taxation 9,317,421 925,403 9,656,431 – – (9,651) 19,889,603 2,858,876 4,130,702 28,114,708 (2,510) 35,101,776

Segment Assets Property, plant & equipment/ biological assets/ intangible assets/ investment property 48,680,389 48,101,671 43,323,468 39,282,039 147,436,922 123,652,755 – – – – 239,440,769 211,036,465 Long-term investments 23,211,490 21,206,311 – – – – 6,906,287 2,934,261 – 854 30,117,777 24,141,426 Deferred tax assets – – 1,103 112,599 2,253,704 876,143 – – – – 2,254,808 988,742 Current assets 30,232,764 881,947 11,053,976 177,741 42,346,428 32,455,216 4,251,043 25,887,170 – – – 62,593,429 Total segmental assets 99,540,746 40,276,584 135,582,874 2,934,261 178,595 104,347,095 47,575,614 175,577,796 6,906,287 – 334,406,792 275,578,800

Segment Liabilities Interest bearing borrowings 6,452,202 10,763,756 32,066,231 27,214,490 – – – – 38,518,433 37,978,246 Long-term creditors 4,269,847 4,043,049 1,839,731 11,327,447 – – – – 6,109,578 15,370,496 Deferred tax liabilities 5,324,868 5,278,972 2,579,407 641,478 11,280,556 9,501,056 – – – – 19,184,831 15,421,506 Retirement benefit obligations 361,511 348,209 107,269 36,253 491,803 318,457 – – – – 960,584 702,920 Current liabilities 23,448,237 259,816 23,976,749 – 386 47,685,188 38,112,248 6,398,368 28,000,510 – – 72,511,127 Total segmental liabilities 43,882,222 937,548 72,338,200 – 386 117,158,356 54,520,677 9,085,044 73,678,813 – – 137,284,533

Other Information Total cost incurred during the period to acquire: Property, plant & equipment 1,689,959 1,416,915 188,147 341,129 11,649,551 25,647,585 – – – – 13,527,657 27,405,629 Intangible assets 87,911 1,660,129 – – 213,240 710,312 – – – – 301,151 2,370,441 Biological assets - – – – 11,323,416 13,776,738 – – – – 11,323,416 13,776,738 Depreciation for the year 1,530,476 1,528,879 96,547 55,797 4,398,822 2,983,378 – – – – 6,025,845 4,568,053 Salaries and wages 3,321,794 3,292,507 498,179 324,913 8,540,326 5,160,395 – – – – 12,360,299 8,777,815 Gratuity 62,700 84,986 17,345 10,606 231,346 90,505 – – – – 311,391 186,097

120 Annual Report 2007/08 Bukit Darah PLC Five Year Summary

(All figures in Notes are in US Dollars unless otherwise stated) Group 31st March 31st March 31st March 31st March 31st March For the year ended 2008 2007 2006 2005 2004

OPERATING RESULTS Revenue 141,221,169 91,124,740 81,212,000 61,154,000 9,279,000 Profit before taxation 48,177,182 26,442,520 25,580,083 39,913,469 4,890,360 Taxation 13,075,406 6,552,917 5,028,757 2,239,515 1,004,967 Profit after taxation 35,101,776 19,889,603 20,551,325 37,673,954 3,885,393 Minority interest - equity 21,593,303 12,202,150 10,763,602 8,219,228 1,489,706 Profit attributable to the shareholders of Bukit Darah PLC 13,508,413 7,687,453 9,787,723 29,454,725 2,395,687

CAPITAL EMPLOYED Stated capital 1,099,153 1,099,153 1,099,153 1,099,153 1,099,153

Reserves 78,066,091 66,070,748 56,364,485 44,332,543 16,481,734

79,165,244 67,169,901 57,463,638 45,431,696 17,580,887

Minority shareholders equity interest 115,088,048 94,184,803 86,001,901 66,581,198 63,329,432

Short-term and long-term borrowings 77,623,245 66,333,783 35,242,758 31,264,708 40,779,930

271,876,537 227,688,487 178,708,298 143,277,602 121,690,249

ASSETS EMPLOYED Non-current assets 268,944,416 236,166,632 188,602,985 141,362,324 134,685,884

Current assets 62,593,429 42,346,428 37,859,000 39,062,000 16,200,000

331,537,845 278,513,060 226,461,985 180,424,324 150,885,884

Current liabilities - excluding borrowings (33,406,314) (19,329,651) (17,776,748) (13,609,449) (8,570,529) Non-current liabilities (6,109,578) (15,370,496) (13,937,265) (8,594,529) (8,418,312)

Deferred liabilities (20,145,415) (16,124,426) (16,039,674) (14,942,745) (12,206,794)

271,876,537 227,688,487 178,708,298 143,277,602 121,690,249 OPERATIONAL RATIOS Return on ordinary shareholders’ funds (%) 16.39 11.33 17.03 64.83 13.63 Equity to total assets (%) 58.95 57.93 63.35 62.08 53.62 Asset turnover (times) 0.42 0.33 0.36 0.34 0.06 Revenue growth (%) 54.98 12.21 32.80 N/A N/A Asset growth (%) 20.07 22.98 25.52 19.58 N/A Revenue to capital employed (times) 0.51 0.40 0.45 0.43 0.08

DEBT & GEARING RATIOS Debt equity ratio (%) 39.38 41.11 24.57 27.91 50.40 Gearing ratio (%) 28.25 29.13 19.72 21.82 33.51

LIQUIDITY RATIOS Current ratio (times) 0.86 0.89 1.00 1.55 0.89

INVESTOR RATIOS Market value per share (US $.) 12.98 12.30 11.15 8.16 14.97 Market capitalisation (US $. ’000) 129,810 122,957 111,461 81,571 149,743 Earnings per share (US $.) 1.34 0.76 0.94 0.44 0.23 Price earnings ratio (times) 11.64 16.15 11.92 18.65 64.04 Net assets per ordinary share (US $) 8.20 6.72 5.74 4.54 1.76

Annual Report 2007/08 Bukit Darah PLC 121 Profiles of Directors

Hari Selvanathan - Chairman Israel Paulraj Hari Selvanathan is Deputy Chairman of Carson Chairman of Ceylon Guardian Investment Trust PLC, Cumberbatch PLC and President Commissioner Ceylon Investment PLC, Watapota Investments of the palm oil related companies in Indonesia. He PLC and Rubber Investment Trust Limited. He holds Directorships in several subsidiary companies serves as a Director of Carson Cumberbatch PLC within the Carsons Group and is also a Director of and of several of the subsidiary companies within Sri Krishna Corporation (Private) Limited, South the Carsons Group. He is the Chairman of the Asian Breweries (Pte) Ltd., Singapore and South Incorporated Trustees of the Church of England in Asia Breweries Private Ltd., India. He also serves Ceylon, a member of the Standing Committee of as the Chairman of Express Newspapers (Ceylon) the Diocese of Colombo and the Hony. Treasurer Ltd. Past President of the National Chamber of the National Christian Council of Sri Lanka. He of Commerce and Past Vice Chairman of the holds a Bachelor of Laws Degree and an Executive International Chamber of Commerce (Sri Lanka). Diploma in Business Administration. He served He served as Chairman of the Tourism Steering as Past Chairman of the Federation of Exporters Committee of the Regaining Sri Lanka Programme Associations of Sri Lanka and The Coconut Products from January 2002 to January 2004. He is also a Traders Association. He was a member of the Director of the India-Sri Lanka Foundation. Holds a Executive Committee of the Ceylon Chamber of Bachelor of Commerce Degree. Commerce, National Chamber of Commerce and Sri Lanka Shippers Council. He served on the Board Mano Selvanathan of Arbitrators of the Ceylon Chamber of Commerce. Mano Selvanathan was conferred the highest He has served as Hony. General Secretary of the National Honours in Sri Lanka the ‘DESHAMANYA’ Central Council of Social Services, as Hony. Treasurer title by H.E. the President of Sri Lanka, in recognition of The Christian Conference in Asia, President, of the services rendered to the nation. He is the Church of Ceylon Youth Movement. He also served on Chairman of Sri Krishna Corporation (Private) Limited the Presidential Task Force on Non-Traditional Export and Ceylon Finance & Securities (Private) Limited. and Import Competitive Agriculture set up by the late He is a member of the Boards of most companies President R. Premadasa. He also served as Chairman in the Carson Cumberbatch Group in Sri Lanka, of the Ecumenical Loan Fund of Sri Lanka and on its Indonesia and Malaysia and is an active member of International Board in Geneva. He was a member of its Executive Management Forums. He is also the the Commercial Law Reform Commission and has Deputy Chairman of The Unit Trust Management served on the Parliamentary Consultative Committee Company (Private) Limited. He is also a Director of on Internal and International Trade. Holcim (Lanka) PLC, South Asian Breweries (Pte) Ltd., Singapore and South Asia Breweries Private Chandima Gunawardena Ltd., India. He is the Chairman of the Indo-Lanka Chandima Gunawardena is a Director of Carson Chamber of Commerce & Industry and has served as Cumberbatch PLC. He serves as a Director in most the Chairman of the Ceylon Chamber of Commerce of the Carsons Group companies and functions and as the President of the Rotary Club of Colombo as the Chairman of some of them. He also sits North. He holds a Bachelors Degree in Commerce. on the Boards of the Group’s Oil Palm Plantation He is also the Hon. Consul for the Republic of Chile Companies in Indonesia and is the President Director in Sri Lanka. of PT Agro Indomas in Indonesia. In addition, he serves as the Deputy Chairman of Union Assurance PLC. Mr. Gunawardena has over three decades of experience in varied fields of business and

122 Annual Report 2007/08 Bukit Darah PLC Profiles of Directors

commercial activities and has held senior positions in Nine (Private) Limited, Equity Lands (Private) the corporate sector. He is a Fellow of the Chartered Limited, Equity Developers (Private) Limited, Equity Institute of Management Accountants, UK. Property Developers (Private) Limited, Carsons Real Estate Management Services (Private) Limited, Tilak de Zoysa Carsons Management Services (Private) Limited and Tilak de Zoysa was conferred with the title in some of the Boards of the Malaysian Plantation ‘Deshabandu’ in recognition of his services to Companies of the Carsons Group. Was the Country Sri Lanka and was the recipient of a prestigious representative for Sri Lanka with Dalekeller & National Honour from the Emperor of Japan. He Associates Ltd, Designers and Skidmore Ownings is Chairman of Carson Cumberbatch PLC and the & Merrill Architects. Counts over 35 years of work Deputy Chairman/Managing Director of Associated experience. Was a Director of SKC Management Motorways Group of Companies and a member Services Ltd. Holds a Technician’s Certificate of the of the Monetary Board of Sri Lanka. He serves as Institute of Work Study Practitioners of U.K. Chairman, Help Age Sri Lanka and on the Boards of John Keells PLC, Taj Lanka Hotels Ltd., Lanka Carson Cumberbatch Group Companies Walltiles Ltd., Nawaloka Hospitals Ltd. and Help Ajith Weeratunge Age International - UK. Mr. de Zoysa is the Honorary Director of the Group’s property development Consul for Croatia and a Past Chairman of the companies including Carsons Real Estate Ceylon Chamber of Commerce, National Chamber Management Services (Private) Limited. Recently of Commerce of Sri Lanka and the Plastics & Rubber appointed as a Director of the Group’s management Institute. Fellow of the Chartered Management company, Carsons Management Services (Private) Institute, U.K. and Fellow of the Plastics and Rubber Limited. Joined the Group in 1996 and carries Institute, Sri Lanka. more than 25 years of finance related experience in leading mercantile sector establishments in Chandana Tissera the country. Fellow of the Chartered Institute of Director of Carson Cumberbatch PLC and several Management Accountants - UK. of its subsidiary companies including the overseas companies of the Carson Cumberbatch Group. Asoka De. Z. Gunasekera He serves as the Chief Executive Officer of the Director, Ceylon Guardian Investment Trust PLC. Plantation Sector and the Investment Sector. He is a Group Director of IWS Holdings (Pvt) Ltd. Past Director of Union Assurance PLC and The Sri Lanka Director Tharuna Aruna Institute under the Ministry of Fund and counts over 22 years experience in the Employment & Labour. He is also a Past Chairman fields of manufacturing, financial services, capital of the National Chamber of Commerce of Sri Lanka market operations, overseas plantations, project and Past President of the Ceylon National Chamber development and management services. He is a of Industries. He is a Past International Director Member of the Accounting Standards Sub Committee and presently a Board Appointee of Lions Clubs of the Ceylon Chamber of Commerce. He is a Fellow International and was also a member of the National of the Institute of Management, UK. Police Commission of Sri Lanka. He served as Legal Advisor and Secretary to the Ministry of Posts and Nalake Fernando Telecommunications; Co-ordinating Secretary to the Director of the property management companies of Ministry of Power & Energy and Ministry of Highways the Carson Cumberbatch Group - Equity One PLC, and was the Acting Secretary to the Ministry of Policy Equity Two PLC, Equity Three (Private) Limited, Planning. Attorney-at-Law & Notary Public. Equity Five Limited, Equity Seven Limited, Equity

Annual Report 2007/08 Bukit Darah PLC 123 Profiles of Directors

Chandraratne Liyanage served on the education and development committee Director Lion Brewery (Ceylon) PLC. Commenced of the institute. Has also passed the examinations of his career as a trainee brewer with Ceylon Brewery Certified Public Accountants in Indonesia. PLC in 1979 and was promoted to Senior Brewer and subsequently to Factory Manager. In 1998, he Cubby Wijetunge took up the position as Factory Manager at Lion Cubby Wijetunge is the Chairman of Ceylon Brewery (Ceylon) PLC and was promoted to his Brewery PLC and Lion Brewery (Ceylon) PLC, current position as Head of Technical in 2004. Holds Union Residencies Ltd, Attidiya Wet Park Project a Special Degree in Botany from the University of and Chairman Emeritus Nestle Lanka Ltd. He Peradeniya (Sri Lanka) and has attended several is also Director of Hunter & Co. Limited, Belvoir overseas training programmes including Carlsberg College Foundation, Janashakthi Insurance and Brew Masters Course, training with Allied Breweries East India Co (Pvt) Ltd. Also serves as Trustee of (UK) & Carlsberg Tetley Leeds Brewery (UK) and Joseph Fraser Hospital. In addition, a member of the management programmes at Cranfield University, Monetary Policy Committee of the Central Bank of UK and National University, Singapore. Sri Lanka and President of the Swiss Business Club of Colombo. Chrisanta Fernando Director of Selinsing PLC and Equity Three (Private) Dato Chin Voon Loong Limited. Served as Managing Director of Distilleries Director of Lion Brewery (Ceylon) PLC. Executive Company of Sri Lanka Limited. Past Director of Director - Corporate Affairs and Company Secretary of the National Lotteries Board and the Coconut Carlsberg Brewery Malaysia Berhad. Also a Director Cultivation Board representing Low Country Products of Carlsberg Singapore (Pte) Ltd. (Singapore), Association (LCPA) of which he held the position Gorkha Brewery (Pvt) Ltd. (Nepal), South East Asia of Chairman for 2 years. Qualified as a Chartered Brewery Ltd. (Vietnam), International Beverage Accountant in England. Member of the Institute of Distributors Ltd. (Vietnam) and Carlsberg Distributors Chartered Accountants of Sri Lanka. Taiwan Limited (Taiwan). Dato Chin is a Member of the Governing Council of the Confederation of Christoforus S. Pakadang Malaysian Brewers Berhad. He is a fellow member Director of the regional plantation sector of the Institute of Chartered Accountants in England management company of the Carson Cumberbatch and Wales and a Member of the Malaysian Institute Group in Indonesia. Is responsible for tax planning of Accountants, Associate Member of the Malaysian & administration and systems & control functions in Institute of Taxation, an Affiliate of The Malaysian addition to overlooking local external affairs of the Institute of Chartered Secretaries and Administrators Group’s plantations in Indonesia. Joined the Carsons (MAICSA) and Member of the Institute of Public Group plantation sector in January 2006 as Head of Relations Malaysia. He previously held the positions External Relations. Holds a Degree in Accounting of Chief Financial Officer and Commercial Director from the University of Indonesia and commenced of Carlsberg Malaysia. Holds a Bachelor of Science his career as an Accountant in IBM Jakarta prior to (Honours) Degree in Systems and Management from joining Ernst & Young, Indonesia. Has functioned The City of London University. as a senior manager at Ernst & Young, Indonesia, where he was involved in auditing and consulting Eranjith Wijenaike assignments across a variety of industries inclusive Director, Equity One PLC. Managing Director of of plantations, manufacturing, property management, Central Finance Company PLC, a leading Non- mining support services and oil & gas. Is a member Banking Financial Institution in the country. Over of the Indonesian Institute of Accountants and has 26 years of management experience. Director

124 Annual Report 2007/08 Bukit Darah PLC Profiles of Directors

of several other quoted companies both within Management Accountants - UK (CIMA), a Fellow of and outside the Central Finance Group. Holds a the Association of Chartered Certified Accountants - Bachelors Degree in Commerce and a Postgraduate UK (FCCA) and a Member of the Malaysian Institute Diploma in Finance and Management. Member of of Accountants (MIA). Also holds a Bachelors Degree the Chartered Institute of Management (UK) and a in Commerce. Fellow of the Institute of Credit Management. Jesper B. Madsen Faiz Mohideen Director of Ceylon Brewery PLC and Lion Brewery Director of Carson Cumberbatch PLC. He served as (Ceylon) PLC. Senior Vice-President, Carlsberg Director Bank of Ceylon, Securities and Exchange Breweries A/S with responsibility for Asia, among Commission, Information and Technology Agency, other markets. Working within the Carlsberg Group Pelwatte Sugar Company Ltd., Sevenagala Sugar since 1984. Chairman of Carlsberg Brewery Hong Corporation, Rubber Research Board and Council Kong Ltd. (Hong Kong), South Asia Breweries (Pvt) of Agricultural Research Policy. Also served as past Ltd. (India), South East Asia Brewery Ltd. (Vietnam), Chairman of Milk Industries of Lanka Company Ltd. International Beverage Distributors Ltd. (Vietnam), His extensive experience includes the positions of Hue Brewery Ltd. (Vietnam). Also Vice Chairman of Deputy Secretary to the Treasury, Director General, Tibet Lhasa Brewery Company (China), Lao Brewery External Resources Department - Ministry of Finance (Laos), Lao Soft Drink Co. Ltd and member of the & Planning, Additional Director General (Economic Board in other Carlsberg Asia companies. Master Affairs), Director (Agriculture), Deputy Director of Laws. (Agriculture) and Assistant Director (Macro Policy) of the National Planning Department of the Ministry of K. L. Tan Finance & Planning. He also worked as a Consultant Director, Shalimar Developments Sdn. Bhd. Has and has been a lecturer at the Polytechnic of South served at a Chartered Accounting Firm in London Bank, London. He holds a B.Sc. in Mathematics and Singapore, at an International Trading Company from the University of London and a M.Sc. in and Quasi- Government Company. Has been Econometrics from the London School of Economics. functioning as a sole practitioner since 1976. Counts over 39 years of work experience and is a Member of Janaka Jayawickrama the Association of Chartered Certified Accountants. Director Legal of the Regional Plantation Sector Management Companies of the Carson Cumberbatch Kenneth Sellayah Group in Indonesia, Malaysia and Sri Lanka and is Director of Good Hope PLC, Shalimar (Malay) PLC responsible for all legal and corporate matters of and Prime Property Management Services (Pvt) the Plantation Sector Companies. Joined Carsons Ltd. Former Director of Shaw Wallace & Hedges in 1997 and managed all legal affairs of the Carson Ltd, General Manager of Ceylon Trading Co. Ltd Cumberbatch Group as Head of Legal. Having and Director of several of its subsidiaries. Served practised in a law firm and working in the corporate as Chairman of the Coconut & General Products sector, she counts over 19 years of experience in the Exporters Association and the Exports Section of the fields of litigation, banking, corporate and commercial Ceylon Chamber of Commerce. Former Director of law. Attorney-at-Law of the Supreme Court. CPC (Lanka) Ltd, CPC Agrifoods Ltd and Member of several Committees of the Ceylon Chamber of Jayaprakash Mathavan Commerce. Member of The Institute of Exports, UK Director, PT Agro Indomas and PT Agro Bukit. and the Chartered Management Institute, UK. Counts over 20 years of work experience in the fields of auditing, manufacturing, plantations and trading. Is an Associate Member of the Chartered Institute of

Annual Report 2007/08 Bukit Darah PLC 125 Profiles of Directors

Keshini de Silva of the Parliamentary Select Committee to arrive Director of Carsons Management Services (Private) at a national solution to the ethnic conflict and Limited, the Group’s management company. She has restore peace, and a Member of the Parliamentary over 17 years of experience in the fields of project Committee on Public Enterprises. Year 2006 - financing, merchant banking and management Chairman, Marga Institute (Centre for Development services and has been with the Carsons Group since Studies). Has a vast amount of international 2001. Prior to joining Carsons worked as a Senior experience and has served on several committees Project Analyst - Corporate Finance Department of including the Steering Committee of the Asian the National Development Bank of Sri Lanka. Holds a Parliamentarians Training Programme for Conflict BSc in Business Administration (Finance Major) from Resolution and the Commonwealth Parliamentary the University of Wisconsin, Superior, USA and is a Association. He was awarded the Eisenhower Fellow of the Institute of Chartered Secretaries and Fellowship in 1975. Member of the Group of Eminent Administrators, UK. Persons appointed by the Heads of State of South Asian Nations to identify measures and mechanisms Kevin de Silva to enhance the effectiveness of SAARC to achieve its Director IT of the regional plantation sector objectives. Barrister-at Law, Middle Temple, London management companies of the Carson Cumberbatch and legal practitioner for over 20 years. Group in Sri Lanka, Indonesia and Malaysia. He leads the ICT organisation for the plantation sector Manilal Fernando and champions the cause of aligning ICT as an Director, Ceylon Guardian Investment Trust PLC. enabler in realising the sector’s strategic goals. Chairman of Holcim (Lanka) PLC, Ruhunu Cement Previously held the post of General Manager - IT Co. Ltd and Galle Cement Co. Ltd. Chairman of for the Carsons Group. Having worked locally and Shipping & Cargo Logistics ( Pvt) Ltd, Hyundai overseas has over 20 years of experience in the Lanka (Pvt) Ltd, Stallion Plantations (Pvt) Ltd and ICT industry in both technical and management Stallion Holdings (Pvt) Ltd. Vice-President of the capacities in leading multinational organisations. Asian Football Confederation (AFC). Member of Professional in Software Engineering and is a the Federation Internationale Football Association member of BCS. (FIFA), Player’s Status Committee. Past President of the Football Federation of Sri Lanka and Vice- Krishna Selvanathan President of the National Olympic Committee. Executive Director, Carsons Real Estate Management Attorney-at-Law & Notary Public. Services (Private) Limited, the property development arm of the Group and is responsible for new property Mark Lightbown development activities of the Group. He is also a Director, Lion Brewery (Ceylon) PLC. Commenced his member of the investment sector management team. career at Morgan Grenfell & Co. Ltd. Subsequently Holds a BA Degree in Accounting & Finance and with Templeton Investment Management Ltd. Counts Business Administration from the University over 16 years of experience of emerging markets of Kent, UK. investments in Asia and Latin America. Holds a Degree in Languages from Oxford University. Mangala Moonesinghe Director of Carson Cumberbatch PLC. He was a Melia Tjandrawinata Member of Parliament of Sri Lanka (1965 - 1977 and Commissioner of PT Agro Indomas. Presently 1989-1994) and the High Commissioner of Financial Director of PT Kawat Mas Prakarsa and Sri Lanka to India (1995-2000 and 2002-2005) and Commissioner of PT Lianganggang Cemerlang. Has to the United Kingdom (2000-2002). Past Chairman 10 years of service at ABN AMRO Bank, Jakarta

126 Annual Report 2007/08 Bukit Darah PLC Profiles of Directors

as Credit Control Manager and Private Banking the strategic review team of the plantation sector Manager. Holds a Bachelor of Arts Degree in in strategic and business planning activities, and Economics from York University, Canada. in undertaking business development initiatives. He joined Carsons Group plantation sector in Minoli Perera 2003 as Financial Controller, having previously Director of Carsons Airline Services (Private) Limited held managerial and senior managerial level and Head of Operations. Has 19 years experience in positions in the mercantile sector in national and the travel industry and holds IATA fares and ticketing multinational companies. He counts in total over 17 certificate of Sri Lankan Airlines and Intermediate years of experience in accounting & finance field in and Advance fares and ticketing certificate of KLM manufacturing, trading & services, FMCG sector, Royal Dutch Airlines. agricultural services and in plantation industries. He is a Fellow Member of the Chartered Institute Prasanna Amarasinghe of Management Accountants - UK (CIMA), holds a Director of Lion Brewery (Ceylon) PLC and is M.Sc in Management, is also a passed finalist of the responsible for the marketing function of the Brewery Institute of Chartered Accountants of Sri Lanka and Sector. He has over 20 years of experience in the has professional qualifications in Marketing (CIM) & field of marketing and has held many senior positions Information Technology (ACS). He currently serves in this area. as a member of the Council of the Chartered Institute of Management Accountants - (CIMA) Sri Lanka Pushpakumara Withana division, chairing the promotions and marketing Director, Pegasus Hotels of Ceylon PLC. Former committee. Chairman of the Sri Lanka Tourist Board and former Director, Food & Beverage, Keells Hotels Sri Lanka Ruvini Fernando and Maldives. Was the Director/General Manager of Director of Guardian Fund Management Limited, the Keells Hotels. Graduate of the Ceylon Hotel School, fund management company of the Carsons Group. past Chairman of the Hotel & Catering International Is an Associate member of the Chartered Institute of Management Association UK, Sri Lanka Chapter Management Accountants, UK and a Fellow of the and Past President and Fellow of the Ceylon Hotel Association of Chartered Certified Accountants, UK. School Graduates Association. Has a Masters Degree in Business Administration from the Postgraduate Institute of Management (PIM), Ranil Goonetilleke University of Sri Jayewardenepura. Counts over Director, Lion Brewery (Ceylon) PLC. Subsequent 18 years work experience in the fields of management to undergoing training at KPMG Ford, Rhodes, accounting, finance, research analysis, strategic Thornton & Co. he joined the Haycarb Group in 1989 planning and investments, within the Hayleys Group and left its employment in 1998 as its Divisional and Carson Cumberbatch Group. Was a former Manager (Finance). He joined Lion Brewery (Ceylon) visiting faculty member of the Postgraduate Institute PLC in 1998 in the capacity of Financial Controller of Management in the MBA programme. Member of and was appointed Director, Finance in 2004. He is the Regaining Sri Lanka Tourism Steering Committee, an Associate Member of the Chartered Institute of a key policy making forum of the Government from Management Accountants, UK since 1989. January 2002 to January 2004. Member of the Economic Fiscal and Policy Planning Sub Committee Rizan Jiffrey of the Ceylon Chamber of Commerce. Director - Planning & Business Development of the regional plantation sector management companies of the Carson Cumberbatch Group in Indonesia, Malaysia and Sri Lanka. He is responsible to assist

Annual Report 2007/08 Bukit Darah PLC 127 Profiles of Directors

Sanjaya Upasena Group of Companies, Employers’ Federation of Director, Sustainability of the regional plantation Ceylon and the British Business Association. Former sector management companies of the Carson committee member of the Planters’ Association of Cumberbatch Group in Indonesia, Malaysia and Ceylon and Ceylon Chamber of Commerce. Sri Lanka. Whilst heading the sustainability development initiatives, he is also responsible to Subramaniam Mahendrarajah facilitate, co-ordinate and monitor the performance Director, Watapota Investments PLC, Weniwella of the plantation operations towards achieving its Investments Limited, Leechman & Company (Private) business plans. He commenced his career as an Limited and Mylands Investments Limited. Group audit intern in 1994, and joined Carsons Group in Finance Director of Sri Krishna Group of Companies. 1999 as a Sector Accountant. He has functioned as Has wide experience in manufacturing, trading, the General Manager, Plantation Operations and as financial services and management. Past President the Regional Financial Controller for the plantation of the Rotary Club of Colombo Down Town. sector of the Carsons Group, having held several senior finance positions within the Carsons Group Supramaniam Ramasamy previously. An Associate member of the Institute Director of PT Agro Indomas, PT Agro Bukit and of Chartered Accountants of Sri Lanka and of the Shalimar Developments Sdn. Bhd. Commenced Chartered Institute of Management Accountants, UK. his plantation career as an Assistant Manager in 1984 with Highlands and Lowlands Sdn. Bhd. Sega Nagendra and subsequently with Kumpulan Guthrie Bhd. in Director of Equity One PLC and Pegasus Hotels Malaysia. In 1995, joined Agro Hope Sdn. Bhd. of Ceylon PLC. Former Senior Director of Carson as the Estate Manager in charge of four estates in Cumberbatch PLC and several of its subsidiaries. Selangor, Malaysia and was promoted to Group Senior Director & Financial Consultant of CML - MTD Manager - Plantations and subsequently to General Construction Ltd., Executive Chairman Travelserv Manager - Plantations. In 2001 was transferred to Ltd and Travelon Ltd. He is also Chairman & Director PT Agro Indomas as General Manager - Plantations of several public and private companies. President and at present is the Director - Operations. Member of Skal International Colombo, Past Secretary of of the Incorporated Society of Planters, Malaysian the Skal International, Asian Area Region and Past Society of Soil Science and Malaysian Institute of President of the Pacific Asia Travel Association Management. Holds a Bachelor of Science Degree (Sri Lanka Chapter). Chairman of the Sri Lanka in Agriculture and Master of Science in Plantation Benelux Business Council and Vice-Chairman of Management from the Agricultural University of the Sri Lanka-Pakistan Business Council. Served Malaysia. as an Executive Committee Member of the Ceylon Chamber of Commerce and former Chairman of the Suresh Shah Import Section of the Ceylon Chamber of Commerce. Director & Chief Executive Officer of Ceylon Brewery Past President of the Chartered Management PLC and Lion Brewery (Ceylon) PLC. He is also a Institute - UK, Sri Lanka Branch. Fellow of the Director of Carson Cumberbatch PLC. Mr. Shah Chartered Management Institute - UK and Master of serves on the main Committee of the Ceylon Chamber Business Administration, UK. of Commerce and is a Council Member of the Sri Lanka Institute of Directors, Employers’ Federation Sri Theagarajah Nagendra of Ceylon and the Industrial Association of Sri Lanka. Director, Indo-Malay PLC. Chairman, Lanka He is also a Member of the Institute of Chartered Aluminium Industries Ltd and Acme Printing & Accountants of Sri Lanka. Packaging Ltd. Former Chairman, James Finlay

128 Annual Report 2007/08 Bukit Darah PLC Profiles of Directors

Syarif Bastaman Vijaya Malalasekera Director of PT Agro Indomas and PT Agro Bukit. Director of Carson Cumberbatch PLC. He served Managing Partner at Bastaman & Co., Law Firm, as Director - Corporate and Legal Affairs at Ceylon Jakarta. President Director of Syabas Energy, Tobacco Company PLC and now serves as a Non- Operations Cooperation Agreement of PT Pertamina Executive Director in the same company. Chairman (2007 up to present). Secretary General of of Asian Cotton Mills Ltd., Bogala Graphite Lanka Indonesian Lawyers Union (SPI) (2007-2012). The Ltd, Fairway Condominiums (Pvt) Ltd, Boston Capital Vice-Chairman Legal Committee of All Indonesian (Pvt) Ltd and holds Directorships in Brown and Football Association (PSSI) (2007-2011). The Company Ltd, Taprobane Investments (Pvt) Ltd, Chairman of Law Council & Advocate, The Central Taprobane Fund Management Limited, Taprobane Representative Council of Revolution Indonesian Holdings Limited, Taprobane Securities (Pvt) Limited, Democracy Party (2004 - 2009). Holds professional Taprobane Mutual Fund Limited, Lexinton Holdings memberships in the Association of Legal Consultants (Private) Limited, Taprobane Plantations Limited and to the Capital Markets (HKPM) and Indonesian Galoya Holdings (Pvt) Limited. Also functioned as Receiver Association (AKPI). Committee the Chairman of the Interim Committee of the Board Vice Chairman, legal practice in the Inter Pacific of Control for Cricket in Sri Lanka from April 2001 to Bar Association (IPBA) since 2002. He is currently 31st March 2002. Holds a M.A. (CANTAB), Barrister- Chairman of the Indonesian Squash Association at-Law, Inner Temple and Attorney-at-Law of the (Pengurus Besar Persatuan Squash Indonesia) Supreme Court of Sri Lanka. (2004 - 2009). Graduated in Law from the University Padjajaran, Bandung in 1987. Wijaya Unamboowe Commissioner of PT Agro Indomas. Former Tai Yit Chan Chairman of Carson Cumberbatch PLC and Director, Shalimar Developments Sdn. Bhd. Managing Lion Brewery (Ceylon) PLC. Former Director of Director for M & C Services Sdn. Bhd. Associate Ceylon Brewery PLC and several plantation sector Member of the Institute of Chartered Secretaries and companies within the Carsons Group. Counts over Administrators, UK and has been involved in corporate 50 years of work experience in diverse fields. secretarial work for over 15 years. Wong Gang Tennyson Rodrigo Director, Goodhope Asia Holdings Ltd. Partner Director of Good Hope PLC. Former Managing in Shook Lin & Bok’s Corporate Finance and Director and Chief Executive of Capital Development International Finance practice. Also a member of the and Investment Company PLC and Chairman of firm’s China practice and has advised multinational CDIC Sassoon Cumberbatch Stockbrokers (Pvt) corporations and Singapore companies on joint Ltd. Past Chairman of the Audit Committee of ventures and cross border transactions in China, as Eagle Insurance PLC. A member of several Audit well as on public offerings of securities in Singapore Committees within the Carson Cumberbatch Group by companies from China. He has advised on a including that of the Holding Company. Holds a B.Sc. wide range of corporate finance and securities in Chemistry and Mathematics from the University transactions, including stock market floatations, of Ceylon and a B.Sc. (Hons) Degree in Chemical rights issues, securities regulation for public listed Engineering from the University of New South Wales, companies, mergers and acquisitions, joint ventures Australia. Chartered Engineer and a Member of the as well as general corporate advisory work. LLB Institute of Chemical Engineers, UK. (Hons.) from the National University of Singapore 1995 and admitted to the Singapore bar in 1996.

Annual Report 2007/08 Bukit Darah PLC 129 Group Directorate

Oil Palm Plantations Beverage Real Estate Hotels & Airlines

shalimar (malay) plc lion brewery equity one plc carsons airline services Directors: H. Selvanathan (ceylon) plc Directors: D.C.R. Gunawardena (private) limited (Chairman), M. Selvanathan, Directors: L.C.R. de C. Wijetunge (Chairman), S. Nagendra, Directors: H. Selvanathan I. Paulraj, N. Ramaiah - resigned (Chairman), Hari Selvanathan K.C.N. Fernando, E.H. Wijenaike (Chairman), w.e.f. 20.11.07, (Deputy Chairman), M. Selvanathan, D.C.R. Gunawardena, Mano Selvanathan, equity two plc D.C.R. Gunawardena, A.K. Sellayah, Suresh K. Shah (Chief Executive Directors: D.C.R. Gunawardena Ms. M.R. Perera P.C.P. Tissera, Officer), D.C.R. Gunawardena, (Chairman), N. Ramaiah - (Appointed w.e.f. 24.04.08) K.C.N. Fernando Dato Voon Loong Chin, (Resigned w.e.f. 20.11.07), Mark Lightbown, P.C.P. Tissera, K.C.N. Fernando pegasus hotels of selinsing plc C. Prasanna Amerasinghe, Alternate Directors: ceylon plc Directors: M. Selvanathan C.T. Liyanage, K.C.N. Fernando Directors: (Chairman), H. Selvanathan, D. Ranil P. Goonetilleke, (for P.C.P. Tissera), D.C.R. Gunawardena (Chairman), C.F. Fernando, I. Paulraj, J.B. Madsen I. Paulraj (for N. Ramaiah) - H. Selvanathan, D.C.R. Gunawardena (Ceased to be as Alternate Director M. Selvanathan, cbl retailers (private) w.e.f. 20.11.07) Sega Nagendra, indo-malay plc limited P.M. Withana Directors: H. Selvanathan Directors: S.K. Shah, equity three (private) Alternate Directors: (Chairman), M. Selvanathan, C. Prasanna Amarasinghe, limited P.C.P. Tissera S.T. Nagendra, I. Paulraj, D.R.P. Goonetilleke Directors: I. Paulraj, C. F. Fernando, (for D.C.R. Gunawardena), D.C.R. Gunawardena, P. C. P. Tissera, K. C. N. Fernando K.C.N. Fernando P.C.P. Tissera committee of Management (for M. Selvanathan) K. C. N. Fernando Strategic Leadership Team equity five limited Alternate Directors: Suresh K. Shah, C. Prasanna Directors: I. Paulraj, equity hotels limited N. Ramaiah (for H. Selvanathan) Amerasinghe, C.T. Liyanage, D.C.R. Gunawardena, Directors: D.C.R. Gunawardena - resigned w.e.f. 20.11.07, Ranil Goonetilleke, Ms. S. Adams, K.C.N. Fernando, P.C.P. Tissera (Chairman), P.C.P. Tissera S. Mahendrarajah (for I. Paulraj) Ms. Nausha Raheem, S. Jansz, W. Heenatigala, B. Dissanayaka, equity seven limited Management Team good hope plc J. Bandara, N. Hulangamuwa, Directors: D.C.R. Gunawardena, Airlines: Directors: H. Selvanathan E. Salgado, P. de Silva K.C.N. Fernando, P.C.P. Tissera Ms. M. Perera, (Chairman), M. Selvanathan, Ms. M. Fernando, I. Paulraj, T. Rodrigo, equity nine (private) limited Ms. S. Welivitage A.K. Sellayah, P.C.P. Tissera, Directors: D.C.R. Gunawardena D.C.R. Gunawardena (Chairman), K.C.N. Fernando, Hotels: Alternate Directors: N. Ramaiah A.P. Weeratunge pegasus hotel (for H. Selvanathan) (Resigned P.M. Withana, A. Weeratunge, w.e.f. 20.11.07), equity lands (private) N. Naganathan, K. Gunathilaka, S. Mahendrarajah limited D. Nanayakkara, D. Karunaratne, (for I. Paulraj), Directors: D.C.R. Gunawardena Ms. M. Munasinghe, M. Ravindran (Chairman), K.C.N. Fernando, pt agro indomas A.P. Weeratunge equity hotel Commissioners: H. Selvanathan P.M. Withana, T. Ganeshan, (President Commissioner), equity developers M. Tennekoon, S. Ekanayake, M. Selvanathan, I. Paulraj, (private) limited M. Edirisinghe W. Unamboowe, Directors: D.C.R. Gunawardena Ms. M. Tjandrawinata (Chairman), K.C.N. Fernando, Directors: D.C.R. Gunawardena, A.P. Weeratunge (President Director), P.C.P. Tissera, (Vice-President equity property Director), S. Bastaman, developers (private) S. Ramasamy, J. Mathavan limited Directors: D.C.R. Gunawardena Management Team (Chairman), K.C.N. Fernando, P.C.P. Tissera, S. Ramasamy, A.P. Weeratunge J. Mathavan, R. Jiffrey, Ms. J. Jayawickrema, K. De Silva, Management Team S. Upasena, C. Pakadang, K.C.N. Fernando, K. Selvanathan, Michael Ng. C. Chong, A. Weeratunge, S. Rajaram, C.S. Karunasena, S. Mukthar R. Perera, V. Wijesinghe, Ms. S. Karunanayake, PT Agro Bukit D. Karunaratne Commissioners: H. Selvanathan (President Commissioner), M. Selvanathan, I. Paulraj Directors: P.C.P. Tissera (President Director), S. Ramasamy (Vice-President /Director), D.C.R. Gunawardena, J. Mathavan, S. Bastaman

130 Annual Report 2007/08 Bukit Darah PLC Group Directorate

Investment Holding &Financial Services Management Services

Carson Cumberbatch PLC GoodHope Asia Holdings carsons management services Directors: T. de Zoysa (Chairman), Limited (private) limited H. Selvanathan (Deputy Chairman), Directors: Wong Gang, Directors: H. Selvanathan (Chairman), M. Selvanathan, P. C. P. Tissera, J. Mathavan, M. Selvanathan, D.C.R. Gunawardena, D.C.R. Gunawardena, S. Ramasamy S.K. Shah, P.C.P. Tissera, K.C.N. Fernando, I. Paulraj, S.K. Shah, Alternate Director: P.C.P. Tissera P.C.P. Tissera, V. Malalasekera, rubber investment trust (for H. Selvanathan) A.P. Weeratunge M. Moonesinghe, limited (Appointed w.e.f. 24.04.08), Ms. K. D. de Silva F. Mohideen Directors: I. Paulraj (Chairman), (Appointed w.e.f. 24.04.08) (Appointed w.e.f. 16.01.08) D.C.R. Gunawardena, P.C.P. Tissera Management Team ceylon guardian B. Patternott, A.P. Weeratunge, investment trust plc mylands investments Ms. K. De Silva, K. Selvanathan, Directors: I. Paulraj (Chairman), limited Ms. S. Jayasekera D.C.R. Gunawardena, Directors: I. Paulraj (Chairman), A. De Z. Gunasekera, D.C.R. Gunawardena, guardian fund management P.C.P. Tissera, V.M. Fernando S. Mahendrarajah, limited P.C.P. Tissera Directors: I. Paulraj, D.C.R. Gunawardena, ceylon investment plc P.C.P. Tissera, Ms. W.Y.R. Fernando Directors: I. Paulraj (Chairman), weniwella investments (Appointed w.e.f. 24.04.08) D.C.R. Gunawardena, limited P.C.P. Tissera Directors: I. Paulraj (Chairman), agro harapan lestari sdn. bhd. S. Mahendrarajah, Directors: H. Selvanathan (Chairman), ceylon brewery plc P.C.P. Tissera M. Selvanathan, D.C.R. Gunawardena, Directors: L.C.R. de C. Wijetunge Alternate Director: S. Ramasamy, P.C.P. Tissera, J. Mathavan, (Chairman), Hari Selvanathan D.C.R. Gunawardena T.Y. Chan, Ms. J.M.S. Jayawickrama (Deputy Chairman), (for P.C.P. Tissera) (Appointed w.e.f. 24.04.08), Mano Selvanathan, K.G.G. De Silva (Appointed w.e.f. 24.04.08), Suresh K. Shah Management Team M.R. Jiffrey (Appointed w.e.f. 24.04.08) (Chief Executive Officer), P.C.P. Tissera, Ms. R. Fernando, C.A.V.S. Upasena (Appointed w.e.f. D.C.R. Gunawardena, Ms. N. Jayatilleke, A. Weeratunge, 24.04.08) P.C.P. Tissera, J.B. Madsen K. Selvanathan (Alternate Director: PT Agro Harapan Lestari N. Ramaiah (for Hari Selvanathan) leechman & company Commissioners: H. Selvanathan (President (private) limited Commissioner), M. Selvanathan watapota investments plc Directors: H. Selvanathan, (Vice-President Commissioner), I. Paulraj, Directors: I. Paulraj (Chairman), M. Selvanathan, D.C.R. Gunawardena S. Mahendrarajah, S. Mahendrarajah Directors: P.C.P. Tissera (President D.C.R. Gunawardena, Director), S. Ramasamy, J. Mathavan, P.C.P. Tissera shalimar developments Ms. J.M.S. Jayawickrama (Appointed Alternate Director: sdn. bhd. w.e.f. 24.04.08), K.G.G. De Silva (Appointed S. Mahendrarajah (for I. Paulraj) Directors: H. Selvanathan w.e.f. 24.04.08), M.R. Jiffrey (Appointed (Chairman), M. Selvanathan, w.e.f. 24.04.08), C.A.V.S. Upasena K.L. Tan, D.C.R. Gunawardena, (Appointed w.e.f. 24.04.08), C.S. Pakadang P.C.P. Tissera, S. Ramasamy, (Appointed w.e.f. 24.04.08) Ms. T.Y. Chan Alternate Director: P.C.P. Tissera Agro Harapan Lestari (Private) (for H. Selvanathan) Limited H. Selvanathan (Chairman), P. C. P. Tissera, J. Mathavan, S. Ramasamy, Ms. J. M. S. Jayawickrama (Appointed w. e. f. 24.04.08), K. G. G. De Silva (Appointed w. e. f. 24.04.08), M. R. Jiffrey (Appointed w. e. f. 24.04.08), C. A. V. S. Upasena (Appointed w. e. f. 24.04.08)

carsons real estate management services (private) limited Directors: D.C.R. Gunawardena (Chairman), K.C.N. Fernando, A.P. Weeratunge, K. Selvanathan (Appointed w.e.f. 15.05.07)

Union Assurance PLC The Unit Trust Management Company ACW Insurance (Private) Limited Directors: A.D. Gunewardene (Chairman), (Private) Limited Directors: A.D. Gunawardena, H.A. Rehmanjee, D.C.R. Gunawardena Directors: B.M. Amarasekera (Chairman), M. Selvanathan H. Selvanathan, (Deputy Chairman), J.R.F. Peiris, (Deputy Chairman) Carson Cumberbatch PLC, Ms. M.A. Tharmaratnam P.C.P. Tissera, Jayampathi Bandaranayake, C. Sathkumara (Executive Director), M.S.P.R. Perera Ms. M.A. Tharmaratnam (Sri Lanka Insurance Corporation), Shri B. Babu Rao Alternate Director: D.C.R. Gunawardena (Administrator to the specified undertaking of UTI), (for H. Selvanathan) D.J.H. Griffiths (HSBC)(Resigned w.e.f. 13.05.2008), B.A.C. Fernando (Bank of Ceylon), N.A. Nicolaou (Appointed w.e.f. 13.05.2008) Alternate Directors: D.C.R. Gunawardena (for M. Selvanathan), T.S.A. Fernandopulle (for D.J.H. Griffiths) (Ceased to be Alternate Director w.e.f. 13.05.2008) T. S. A. Fernandopulle - (Appointed Alternate Director to Mr. N. A. Nicolaou w.e.f. 13.05.2008)

Annual Report 2007/08 Bukit Darah PLC 131 Information to Shareholders and Investors

1. stock Exchange Listing Bukit Darah PLC is a Public Quoted Company, the ordinary shares of which are listed on the main board of the Colombo Stock Exchange of Sri Lanka (CSE).

2. market Capitalisation and Market Prices Market Capitalisation of the Company’s share, which is the number of ordinary share in issue multiplied by the market value of a share, was Rs. 14 bn as at 31st March 2008 (2007 - Rs. 13.4 bn).

The information on market prices are set out below:

2008 Q4 Q3 Q2 Q1 2007

Share Information Highest price (Rs.) 1,500 1,500 1,400 1,005 1,400 1,649 Lowest price (Rs.) 805 1,102 965 900 805 975 As at periods end (Rs.) 1,400 1,400 1,300 970 1,050 1,339

Trading Statistics No. of transactions 1,584 311 477 440 356 924 No. of shares traded (Thousands) 579,400 75,800 93,700 360,500 49,400 236,600 Value of all shares Traded (Rs. mn) 605,827 100,332 109,548 337,821 58,126 285,904 Market Capitalisation (Rs. mn) 14,000 14,000 13,000 9,700 10,500 13,390 Enterprise Value (Rs. mn) 32,718 32,718 31,435 27,905 27,973 29,701

3. share Holder Base The total number of share holders as at 31st March 2008 was 1,368 compared to the 1,218 as at 31st March 2007. The number of ordinary shares held by non-resident as at 31st March 2008 was 2,172,256 which amount to 21.72% of the ordinary share capital.

4. Distribution and Composition of Shareholders

Residents Non-Residents Total Distribution No. of No. of % No. of No. of % No. of No. of % of Shares Members Shares Members Shares Members Shares 1 - 1,000 1,250 91,108 0.91 17 5,781 0.06 1,267 96,889 0.97 1,001 - 5,000 37 79,976 0.80 10 36,000 0.36 47 115,976 1.16 5,001 - 10,000 15 113,275 1.13 4 35,400 0.35 19 148,675 1.49 10,001 - 50,000 10 168,459 1.68 6 130,875 1.31 16 299,334 2.99 50,001 - 100,000 3 228,101 2.28 4 266,700 2.67 7 494,801 4.95 100,001 - 500,000 4 1,396,925 13.97 0 0 0.00 4 1,396,925 13.97 500,001 - 1,000,000 5 3,746,150 37.46 2 1,697,500 16.98 7 5,443,650 54.44 Above 1,000,000 1 2,003,750 20.04 0 0 0.00 1 2,003,750 20.04 Grand Total 1,325 7,827,744 78.28 43 2,172,256 21.72 1,368 10,000,000 100.00

132 Annual Report 2007/08 Bukit Darah PLC 5. composition of Shareholders

31st March 2008 31st March 2007 Ordinary Shares No. of No. of % No. of No. of % Shareholders shares Shareholders Shares

Individuals 1,275 620,813 6.21 1,142 889,763 8.9 Institutions 93 9,379,187 93.79 76 9,110,237 91.1 Total 1,368 10,000,000 100.00 1,218 10,000,000 100.00

Residents 1,325 7,827,744 78.28 1,184 7,961,497 79.61 Non-Residents 43 2,172,256 21.72 34 2,038,503 20.39 Total 1,368 10,000,000 100.00 1,218 10,000,000 100.00

Percentage of issued ordinary share capital held by the public as at 31st March, 2008 was 30.64%.

6. key Ratios 2008 2007 Rs. Rs.

EPS 148.34 80.37 Price to book (times) 1.58 1.83 Price /cash earnings 3.76 15.84

7. information on Dividends The details of the dividends paid are as follows:

2008 2007 Per share amount Per Share Amount Rs. rs. ‘000 Rs. Rs. ‘000

Ordinary shares Interim dividend ( 2006) – – 4.5 45,000 Final dividend 0.5 5,000 5.00 50,000 5.00 50,000.00 5.00 50,000

8% participating cumulative Preference Shares Annual 0.80 144 0.80 144 Final Dividend 39.50 7,125 3.51 631 Interim dividend ( 2006) 35.57 6,402 – – 39.87 7,177 40.30 7,269

The details of the proposed dividends are as follows: Ordinary Shares 5.00 50,000 1.00 10,000 8% participating cumulative Preference Shares 7.50 1,350 39.50 7,110 8.50 11,350.00 44.50 57,110

8. shareholder Information The ordinary shares of the Company are listed on the Colombo Stock Exchange Stock Exchange ticker symbol for the Bukit Darah PLC shares: BUKI.N0000.

Annual Report 2007/08 Bukit Darah PLC 133 Value of Real Estate & Properties

The values of land & buildings owned and leased by companies within the Group and which have been revalued by qualified valuers and Directors as the case may be are indicated below together with the last date of valuation:

As at 31st March 2008 Land & Building Company Location Extent Market Book Date of (in acres) Value Value Last Valuation Rs. 000 Rs. ‘000

Equity One PLC Colombo 7 0.60 632,650 632,650 31.03.2007 Equity One PLC Colombo 2 1.36 291,000 291,000 31.03.2007 Equity Two PLC Colombo 1 0.54 540,863 540,863 31.03.2007 Equity Three (Private) Ltd. Colombo 13 0.26 136,660 136,660 31.03.2007 Equity Five Ltd. Colombo 2 0.44 145,375 145,375 31.03.2007

Selinsing PLC Katunayake 7.65 165,262 165,262 31.03.2007

10.85 1,911,810 1,911,810

PT Agro Indomas Indonesia 38,310.10 11,306,000 10,246,941 31.03.2008 PT Agro Bukit Indonesia 33,431.10 5,595,378 5,062,362 30.03.2008 Good Hope PLC Malaysia 780.68 882,655 882,655 30.06.2007 Selinsing PLC Malaysia 1,217.84 1,294,831 1,294,831 30.06.2007 Shalimar (Malay) PLC Malaysia 757.28 1,232,668 1,232,668 30.06.2007

Indo-Malay PLC Malaysia 725.30 964,785 964,785 30.06.2007

75,222.10 21,276,317 19,684,242

Ceylon Brewery PLC Nuwara Eliya 15.55 7,750 7,750 31.03.2006

Lion Brewery (Ceylon) PLC Biyagama 17.63 1,010,565 1,010,565 31.03.2006

33.18 1,018,315 1,018,315

Pegasus Hotels of Ceylon Ltd. Wattala 20.21 568,772 568,772 31.03.2006

Equity Hotels Ltd. Giritale 14.91 19,573 19,573 31.03.2006

35.12 588,345 588,345

Equity Property Developers (Private) Ltd. Mount Lavinia 6.00 535,124 535,124 31.03.2008 Equity Nine (Private) Ltd. Mirihana 2.19 236,623 236,623 31.03.2008

Equity Developers (Private) Ltd. Athurugiriya 1.06 16,899 16,899 31.03.2008

9.25 788,646 788,646

Total value 75,310.50 25,583,433 23,991,358

There has been no permanent reduction in the value of land & buildings which may require provision.

* These valuations have not been incorporated in the books of account. ** Leasehold property. * Includes all property, plant & equipment and biological assets.

134 Annual Report 2007/08 Bukit Darah PLC Glossary of Financial Terms

Capital Reserves Net Assets per Share Reserves identified for specific purposes and considered Total assets less total liabilities, excluding preference not available for distribution. share capital and minority interests divided by the number of ordinary shares in issue. Cash Equivalents Liquid investments with original maturities of six months Net Current Assets or less. Current assets less current liabilities. Measures the capital required to finance the day-to-day operations. Contingent Liabilities Conditions or situations at the Balance Sheet date, the Price Earnings Ratio (P/E) financial effects of which are to be determined by future Market price of a share divided by earnings per share. events which may or may not occur. Related Parties Parties who could control or significantly influence Current Ratio the financial and operating policies/decisions of the Current assets divided by current liabilities. business.

Debt Return on Shareholders’ Funds Total borrowing. Profit attributable to shareholders less preference dividend divided by shareholders’ funds (total of ordinary share capital and reserves). Dividend per Share Dividend paid divided by the number of shares in issue Revenue Reserves which ranked for those dividend. Reserves considered as being available for distribution.

Earnings per Share Segment Profits attributable to ordinary shareholders before Constituent business units grouped in terms of nature extraordinary items and after preference dividend and similarity of operations. divided by the weighted average number of ordinary shares in issue, ranking for dividend. Value Addition The quantum of wealth generated by the activities of the Group. Equity Shareholders’ funds. Others CPO - Crude Palm Oil Events Occurring after the Balance Sheet date PK - Palm Kernel Significant events that occur between the Balance Sheet FFB - Fresh Fruit Bunches date and the date on which financial statements are COP - Cost of Production authorised for issue.

Market Capitalisation The market value of a company at a given date obtained by multiplying the share price by the number of shares in issue.

Annual Report 2007/08 Bukit Darah PLC 135 Notice of Meeting

NOTICE IS HEREBY GIVEN that the NINETY SECOND Notes ANNUAL GENERAL MEETING of Bukit Darah PLC will 1. A member is entitled to appoint a proxy to attend be held on Monday the 30th day of June 2008 at and vote instead of him/herself. A proxy need not 3.30 p.m. at the ‘Sapphire Ballroom’, Ceylon Continental be a member of the Company. A Form of Proxy Hotel, No. 48, Janadhipathi Mawatha, Colombo 1 for the accompanies this notice. following purposes: 2. The completed Form of Proxy must be deposited (1) To receive and adopt the Report of the Directors at the Registered Office, No. 61, Janadhipathi and the Financial Statement for the year ended Mawatha, Colombo 1, not later than 3.30 p.m. on 31st March 2008, together with the Report of the 28th June 2008. Auditors thereon. 3. A person representing a corporation is required to (2) To declare a dividend as recommended by the carry a certified copy of the resolution authorising Directors. him/her to act as the representative of the Corporation. A representative need not be a (3) To re-elect Mr. T. de Zoysa who retires by rotation member. in terms of Articles 82 & 83 of the Articles of Association of the Company. 4. The transfer books of the Company will be kept open.

(4) To Re-elect Mr. I. Paulraj as a Director of the Company who is over Seventy years of age and Security Check to consider and if deemed fit to pass the following We shall be obliged if the shareholders/proxies attending the Annual General Meeting, produce their National resolution: Identity Cards to the security personnel stationed at the “IT IS HEREBY RESOLVED that the age limit entrance lobby. stipulated in Section 210 of the Companies Act No. 7 of 2007 shall not be applicable to Mr. I. Paulraj who is 71 years of age and that he be re-elected a Director of the Company from the conclusion of the Annual General Meeting for a further period of one year.”

(5) To reappoint Messrs. KPMG Ford, Rhodes, Thornton & Co., Chartered Accountants as Auditors of the Company as set out in Section 154(1) of the Companies Act No. 7 of 2007 and to authorise the Directors to determine their remuneration.

By Order of the Board, Carsons Management Services (Private) Limited Secretaries

Colombo, 26th May 2008

136 Annual Report 2007/08 Bukit Darah PLC Form of Proxy

*I/We ...... ……………...... ……………………....……. of ...... …………...... ……...... ……………………. being * a Member/Members of BUKIT DARAH PLC, hereby appoint ...... of ...... bearing NIC

No./Passport No...... of failing him/her.

Hariharan Selvanathan or failing him, Manoharan Selvanathan or failing him, Israel Paulraj or failing him, Don Chandima Rajakaruna Gunawardena or failing him, Tilak de Zoysa or failing him, Palehenalage Chandana Priyankara Tissera or failing him, Kurukulasuriya Calisanctus Nalake Fernando as *my/our proxy to attend at the Annual General Meeting of the Company to be held on Monday the 30th day of June 2008 at 3.30 p.m., at the ‘Sapphire Ballroom’, Ceylon Continental Hotel, No. 48, Janadhipathi Mawatha, Colombo 1 and any adjournment thereof and at every poll which may be taken in consequence thereof. For Against (i) To adopt the Report of the Directors and the Financial Statements for the year ended 31st March 2008, together with the Report of the Auditors thereon.

(ii) To declare a final ordinary dividend of Rs. 5/- per share which carries a Rs. 39/50 dividend per participative Cumulative preference share for the financial year ended 31st March 2008, as recommended by the Directors.

(iii) To re-elect Mr. T. de Zoysa who retires in terms of Articles 82 & 83 of the Articles of Association of the Company.

(iv) To re-elect Mr. I. Paulraj who is over seventy years of age as a Director of the Company

(v) To reappoint Messrs. KPMG Ford, Rhodes, Thornton & Co., Chartered Accountants as Auditors of the Company as set out in Section 154 (1) of the Companies Act. No. 7 of 2007 and to authorise the Directors to determine their remuneration.

Signed this ………………...... day of ...... Two Thousand and Eight.

………………...... …………………. Signature/s

Notes: (a) *Please delete the inappropriate words. (b) A shareholder entitled to attend and vote at a General Meeting of the Company, is entitled to appoint a proxy to attend and vote instead of him/her and the proxy need not be a shareholder of the Company. A proxy so appointed shall have the right to vote on a show of hands or on a poll and to speak at the general meeting of the shareholders. (c) A shareholder is not entitled to appoint more than one proxy to attend on the same occasion. (d) Instructions are noted on the reverse hereof.

Annual Report 2007/08 Bukit Darah PLC 137 Form of Proxy

INSTRUCTIONS AS TO COMPLETION 1. Kindly perfect the Form of Proxy after filling in legibly your full name and address, by signing in the space provided. Please fill in the date of signature.

2. If you wish to appoint a person other than the Directors as your proxy, please insert the relevant details in the space provided overleaf.

3. In terms of Article 67 of the Articles of Association of the Company: The instrument appointing a proxy shall be in writing and (i) in the case of an individual shall be signed by the appointer or his attorney; and (ii) in the case of a corporation shall be either under its common seal or signed by its attorney or by an officer on behalf of the corporation.

The Company may, but shall not be bound to, require evidence of the authority of any such attorney or officer.

A proxy need not be a member of the Company.

4. In terms of Article 62 of the Articles of Association of the Company;

In the case of joint-holders of a share, the senior who tenders a vote, whether in person or by proxy or by attorney or by representative, shall be accepted to the exclusion of the votes of the other joint-holders and for this purpose seniority shall be determined by the order in which the names stands in the Register of Members in respect of the joint holding.

5. To be valid the completed Form of Proxy should be deposited at the Registered Office of the Company situated at No. 61, Janadhipathi Mawatha, Colombo 1 not later than 3.30 p.m. on 28th June 2008.

Please fill in the following details

Name : ......

Address : ......

......

Jointly with Share folio No. : ......

138 Annual Report 2007/08 Bukit Darah PLC Produced by: Smart Media Printed by: Printel (Pvt) Ltd. Corporate Information (resigned w.e.f.20thNovember2007) N. Ramaiah K. C.N.Fernando P. C.Tissera Tilak deZoysa D. ChandimaR.Gunawardena Israel Paulraj Mano Selvanathan Hari Selvanathan Board ofDirectors Liability IncorporatedinSriLanka1916 A PublicQuotedCompanywithLimited Legal Form PQ 56 Company RegistrationNo. Bukit DarahPLC Name oftheCompany www.carsoncumberbatch.com Corporate Website Fax: +94114739300 Tel: +94114739200 61, JanadhipathiMawatha,Colombo1,SriLanka. Registered Office Fax: +94114739300 Tel: +94114739200 61, JanadhipathiMawatha,Colombo1,SriLanka. Carsons ManagementServices(Private)Ltd. Managers &Secretaries Colombo 3,SriLanka. 32A, SirMohamedMacanMarkarMawatha Chartered Accountants Messrs. KPMGFord,Rhodes,Thornton&Co. Auditors Deutsche Bank PT BankDanamonIndonesia,Tbk Rabobank ofNetherlands Indian Bank Sampath Bank HSBC Commercial Bank Citibank NA Bank ofCeylon Standard CharteredBank Bankers totheGroup (Alternate forHariSelvanathan) (Chairman)