Connecting Communities Delivering Value

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Connecting Communities Delivering Value CONNECTING COMMUNITIES DELIVERING VALUE ANNUAL REPORT 2017 Connecting Communities Delivering Value The cover of Cahya Mata Sarawak Berhad’s 2017 Annual Report portrays a striking night shot of the Darul Hana Bridge, Kuching’s iconic new landmark which connects the northern Our Vision Our Stakeholders and southern parts of the city, and which CMS had a hand in constructing. Our cover also carries the theme ‘Connecting To be the PRIDE of Our Shareholders, Staff, Communities. Delivering Value’ which not only reflects the Sarawak & Beyond Customers & Community role that the bridge is playing in integrating communities and delivering tangible value, it also serves as an expression of how CMS is doing its bit to connect communities and deliver real value. As a leading proponent of the Sarawak’s growth story, CMS continues to identify opportunities to help build and strengthen linkages between markets, businesses and communities, as well as create tangible value for our four key stakeholders. These include the host of infrastructure projects and related services required across the State and the Our Mission energy-intensive opportunities under the Sarawak Corridor of Renewable Energy (SCORE) initiative. By continuously P Producing Quality, On Spec & On Time reinvesting into our core competencies and expanding into related infrastructure facilitation activities, we continue to R Respect & Integrity create a long-term, sustainable growth pathway for both CMS I Improving, Innovating & Investing in People and Sarawak, as well as good value for our stakeholders. As we maximise our participation in the Sarawak’s growth D Delivering Sustainable Growth story, CMS undoubtedly remain one of the best proxy-listed investments for Sarawak’s dynamic growth. E Environmentally Conscious, Safe & Conducive Workplace TABLE OF CONTENTS Section Section Section The Year Governance: Additional 1 That Was 4 A Trusted Framework 6 Information 2 Corporate Milestones 45 Board of Directors’ Profile 198 Analysis of Shareholdings 6 Performance at a Glance 53 Senior Management Team 201 List of Properties 7 Financial Highlights 61 Corporate Governance Overview 206 Group Directory Statement 7 2017 Share Price Performance 79 Statement on Risk Management and Internal Control Section 85 Additional Compliance Information Section 86 Statement of Directors’ Annual General Responsibility Meeting 2018 CMS at 7 2 a Glance 208 Administrative Guide Section rd 8 Our Business 210 Notice of 43 Annual General Meeting 10 Corporate Information Financial Statements 217 Statement Accompanying Notice of 11 Corporate Structure 5 43rd Annual General Meeting Form of Proxy 88 Directors’ Report Section 93 Statement by Directors 93 Statutory Declaration Our Business 94 Independent Auditors’ Report Strategy 3 98 Statements of Profit or Loss and Other Comprehensive Income 13 Chairman’s Statement 99 Statements of Financial Position 19 Management Discussion 101 Statements of Changes in Equity and Analysis 104 Statements of Cash Flows 43 Embedding Sustainability into Our Strategy 109 Notes to the Financial Statements 1 2 3 4 5 6 7 The Year That Was Corporate Milestones STRENGTHENING OUR GROUP FOR SUSTAINABLE GROWTH 06-07 JUL 13 JUL 21 JUL CMS Pavement Tech Sdn Bhd Dato Isaac Lugun and Mr Goh Chii Bing collaborated with Lebuhraya were appointed as Group Chief Corporate Borneo Utara Sdn Bhd and Officer and Group Chief Operating Officer Wirtgen (M) Sdn Bhd to provide respectively effective 1 August 2017. These improved solutions on road appointments were made following the construction processes using a impending retirement of Dato’ Richard Curtis laying machine (paver) through on 31 December 2017. On 1 January 2018, water jet and pressure bars. Dato Isaac’s and Mr Goh’s positions were re-designated as Group Chief Executive Officer - Corporate and Group Chief Executive Sarawak Minister for Tourism, Arts, Culture, Youth and Officer - Operations respectively. Sports, YB Datuk Abdul Karim Rahman Hamzah visited the new Sarawak Museum Campus project site. Project cost is RM308.00 million and is scheduled for completion in January 2020. 01 NOV 11 NOV (21076-T) Cahya Mata Sarawak Berhad The Land Custody and Development Authority Headquarter building The Darul Hana Bridge was officially opened by His Excellency The achieved practical completion on 31 July 2017. This GBI-certified Governor of Sarawak, Tun Pehin Sri Haji Abdul Taib Mahmud. This 11-storey office tower was built under a Design and Build and RM35.00 million project was implemented by the Sarawak Economic Negotiated Contract by CMS Land Sdn Bhd at a cost of RM66.00 milion Development Corporation for the State Government of Sarawak and and it is one of the two Gateway Towers at The Isthmus. the turnkey contract was awarded to the consortium of PPES Works (Sarawak) Sdn Bhd and Naim Land Sdn Bhd. 15 NOV 04 DEC 29 DEC CMS Education Sdn Bhd CMS announced the entered into a Management retirement of Dato’ Richard Agreement with HELP Curtis as Group Managing Education Services Sdn Bhd. Director on 31 December This partnership is aimed at 2017 and re-designations of delivering excellent academic Dato Isaac Lugun as Group performance and good quality Chief Executive Officer – education by capitalising on Corporate and Mr Goh Chii the school’s existing holistic Bing as Group Chief Executive learning approach. CMS Officer – Operations. Education Sdn Bhd oversees Tunku Putra School. The Design and Build and Negotiated Contract of the proposed 43km Miri-Marudi road rehabilitation project was signed. The construction period is 30 months and is scheduled for completion by 15 March 2019. 2 1 2 3 4 5 6 7 The Year That Was Corporate Milestones OUR BUSINESS HIGHLIGHTS 24 FEB 15 MAY 25 AUG CMS recorded a revenue of RM1.55 billion, CMS recorded a revenue of RM282.30 million CMS recorded a revenue of RM670.57 million with a pre-tax profit of RM302.14 million for and a pre-tax profit of RM38.54 million for the for 1H 2017, a drop of 10% compared to the the year ended 31 December 2016. first quarter ended 31 March 2017. preceding year’s corresponding period (1H 2016) of RM745.72 million. Its pre-tax profit increased by 106% from RM65.67 million to RM135.44 million reported in 1H 2016. 11 SEP ANNUAL 2017 ANNUAL REPORT CMS Property Development Sdn Bhd received the ‘Merit Award for Landed Development (Residential)’ for its Rivervale Residences at the Sarawak Housing and Real Estate Developer Association’s (SHEDA) Excellence Awards 2017 in Kuching. 15 SEP COPE Private Equity Sdn Bhd (formerly known as CMS Opus Private Equity Sdn Bhd) received the ‘Exit of the Year’ award for its investee company, Delta Express (M) Sdn Bhd at the Malaysian Venture Capital & Private Equity Association’s 11th Annual Dinner and Awards Night 2017. 29 NOV CMS recorded a revenue of RM1.02 billion and pre-tax profit of RM231.02 million for the first nine months of 2017. 3 1 2 3 4 5 6 7 The Year That Was Corporate Milestones ENGAGING OUR STAKEHOLDERS 06-07 APR 26 APR A two-day workshop entitled ‘Management & Maintenance of Road Assets using CMS held its 42nd Annual General Meeting for Performance-based Contract’ organised by CMS Roads Sdn Bhd and JKR Sarawak was its shareholders for the financial year ended officiated by Sarawak Deputy Chief Minister and Minister for Infrastructure Development 31 December 2016. and Transportation, YB Tan Sri Datuk Amar Dr James Jemut Anak Masing. (21076-T) 19 MAY 04 JUL Cahya Mata Sarawak Berhad Borneo 744, Malaysia’s first Blue Ocean Entrepreneurs Township was CMS Roads Sdn Bhd’s project team briefed the Sarawak Deputy Chief officiated by the Secretary General of Treasury, Ministry of Finance Minister, YB Tan Sri Datuk Amar Dr James Jemut Anak Masing on the Malaysia, Y Bhg Tan Sri Dr Mohd Irwan Serigar bin Abdullah. The land progress of the on-going Miri-Marudi Road project. The Company which houses Borneo 744 is owned by CMS Land Sdn Bhd which it provides quarterly updates to the media on this project. leases rent-free for 15 years, as part of the Company’s corporate social responsibility initiative. 27 AUG Projek Bandar Samariang Sdn Bhd celebrated its 20th anniversary with a variety of activities held for the Bandar Samariang community. CMS also sponsored 341 subscriptions for six months to SMK Bandar Baru Samariang under The Star ePaper/NiE Sponsorship Programme for Schools. 4 1 2 3 4 5 6 7 The Year That Was Corporate Milestones 27 AUG 09 OCT CMS Tribal Run 3.0 attracted 3,100 runners with 100% of its entry fees CMS, a main sponsor, participated in the Asian Strategy & Leadership of RM133,000 donated to 10 local charitable organisations. Institute’s 4th Sarawak Business & Investment Summit 2017 themed ‘Digitalising Sarawak, Amplifying Growth’ in Kuching. 21-23 NOV 22 NOV 2017 ANNUAL REPORT CMS was the Gold Sponsor for the 13th World Islamic Economic Forum Amongst the many programmes organised by the WIEF, a special (WIEF) which was held for the first time in Kuching. The three-day forum programme was held in collaboration with Malaysian Phosphate Additives gathered more than 2,500 delegates from over 60 countries. Prime (Sarawak) Sdn Bhd, whereby a topic on synergistic and downstream Minister and Patron of the WIEF Foundation, YAB Dato’ Sri Najib Tun opportunities of an integrated phosphate complex at Samalaju Industrial Abdul Razak, officiated the event. Park was presented. 22 NOV 04-05 DEC Dato Isaac Lugun, Group Chief Executive Officer - Corporate presented CMS annual Town Hall sessions were held in Kuching and Bintulu where a paper at the Supply Chain Conference @ East Malaysia organised by employees were briefed on the performance of the CMS Group for the the Malaysian Investment Development Authority and Ministry of year 2017. They were also updated on the business operations and International Trade and Industry.
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