Sime Darby Berhad Annual Report 2009
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SIME DARBY BERHAD ANNUAL REPORT 2009 1 SIME DARBY BERHAD – COVER RATIONALE Bright Future. The warm orange tone blends into a touch of yellow that demonstrates the aspirations and qualities that underscore our drive for a brighter and sustainable future. Sime Darby’s strong heritage ensures our strength in continued growth. Ninety-nine years ago, Sime Darby was incorporated as a small British company managing 500 acres of rubber estates in Malacca. From such modest beginnings, Sime Darby has grown into the biggest multinational corporation in Malaysia. With operations spanning over 20 countries, Sime Darby is supported by a team of over 100,000 people worldwide - guided by one mission - to make a sustainable future real for everyone. The cover inlay is a reproduction of an actual report by the Directors to the 14th Ordinary Annual General Meeting of Shareholders of Sime, Darby & Co, Ltd. held on 7 March 1925. The report was signed by John Middleton Sime, in his capacity as Chairman of the Board. John was brother to William Middleton Sime, who founded Sime Darby with Henry Darby in 1910. Sime Darby’s commitment to a sustainable future is further reflected in the depiction of children throughout this publication, as future leaders and ambassadors of the Group. THE SIME DARBY GROUP Since 1910, we have grown to become a key player in the Malaysian economy as well as a diversified multinational with operations in over 20 countries. Our core divisions comprise plantation, property, industrial, motors and energy & utilities, with healthcare as a growing business. We are the largest listed company on Bursa Malaysia with a market capitalisation of RM41.76 billion as at 30 June 2009. Our employees of nearly 100,000 people are committed to the single goal of developing sustainable futures for all of our stakeholders. OUR MISSION Making a sustainable future real for everyone. OUR VALUES Respect and Responsibility Respect for the individuals we interact with and the environments that we operate in (internally and externally) and committing to being responsible in all our actions. Excellence Stretch the horizons of growth for ourselves, our businesses and our people through our unwavering ambition to achieve outstanding personal and business results. Enterprising Seek and seize opportunities with speed and agility, challenging set boundaries. Integrity Uphold high levels of personal and professional values in all our business interactions and decisions. Sime Darby Berhad (Company No. 752404-U) 19th Floor, Wisma Sime Darby Jalan Raja Laut 50350 Kuala Lumpur, Malaysia Tel: 603 2691 4122 Fax: 603 2382 1075 Email: [email protected] Website: www.simedarby.com CONTENTS Notice of Annual General Meeting 2 - 5 3 Years Financial Summary 6 - 8 Group Structure 10 Corporate Information 11 - 19 Management Team 20 - 24 Report on the Audit Committee 25 - 27 Statement on Corporate Governance 28 - 45 Statement on Internal Control 46 - 48 Chairman’s Message 50 - 53 President & Group Chief Executive’s Review 54 - 56 Operations Review 58 - 82 Corporate Social Responsibility Report 84 - 88 Corporate Diary 90 - 92 Reports and Financial Statements 95 - 213 Global Business Presence 214 Analysis of Shareholdings 216 - 218 Financial Calendar & Share Price Movement 219 Properties of the Group 220 - 234 Form of Proxy 235 SIME DARBY BERHAD ANNUAL REPORT 2009 2 NOTICE OF ANNUAL GENERAL MEETING NOTICE IS HEREBY GIVEN that the Third Annual General Meeting of Sime Darby Berhad will be held at Grand Ballroom, First Floor, Sime Darby Convention Centre, 1A, Jalan Bukit Kiara 1, 60000 Kuala Lumpur, Malaysia on Monday, 30 November 2009 at 11.30 a.m. for the following purposes:- As ORDINARY BUSINESS a. To receive the Audited Financial Statements for the year ended 30 June 2009 together with the Reports of the Directors and the Auditors thereon. Resolution 1 b. To declare a final single tier dividend of 15.3 sen per share for the year ended 30 June 2009. Resolution 2 c. To approve the annual remuneration for the Non-Executive Directors at an amount not exceeding RM4,500,000 in aggregate. Resolution 3 d. To consider and, if thought fit, pass the following resolutions pursuant to Section 129(6) of the Companies Act, 1965:- i. “THAT pursuant to Section 129(6) of the Companies Act, 1965, Tun Musa Hitam be re- appointed a Director of the Company to hold office until the conclusion of the next Annual General Meeting.” Resolution 4 ii. “THAT pursuant to Section 129(6) of the Companies Act, 1965, Tun Ahmad Sarji Abdul Hamid be re-appointed a Director of the Company to hold office until the conclusion of the next Annual General Meeting.” Resolution 5 iii. “THAT pursuant to Section 129(6) of the Companies Act, 1965, Dr. Arifin Mohamad Siregar be re-appointed a Director of the Company to hold office until the conclusion of the next Annual General Meeting.” Resolution 6 iv. “THAT pursuant to Section 129(6) of the Companies Act, 1965, Dato’ Sri Mohamed Sulaiman be re-appointed a Director of the Company to hold office until the conclusion of the next Annual General Meeting.” Resolution 7 v. “THAT pursuant to Section 129(6) of the Companies Act, 1965, Dato’ Dr. Abdul Halim Ismail be re-appointed a Director of the Company to hold office until the conclusion of the next Annual General Meeting.” Resolution 8 e. To elect Tan Sri Samsudin Osman who retires in accordance with Article 104 of the Company’s Articles of Association. Resolution 9 f. To re-elect the following Directors who retire by rotation in accordance with Article 99 of the Company’s Articles of Association:- Raja Tan Sri Dato’ Seri Arshad Raja Tun Uda Resolution 10 Dato’ Henry Sackville Barlow Resolution 11 Dato’ Seri Ahmad Zubair @ Ahmad Zubir Haji Murshid Resolution 12 g. To re-appoint PricewaterhouseCoopers as Auditors of the Company for the ensuing financial year, and to authorise the Directors to fix their remuneration. Resolution 13 SIME DARBY BERHAD ANNUAL REPORT 2009 NOTICE OF ANNUAL GENERAL MEETING 3 As SPECIAL BUSINESS h. To consider and, if thought fit, pass the following Ordinary Resolution:- Authority to Allot and Issue Shares pursuant to Section 132D of the Companies Act, 1965 “THAT, subject always to the Companies Act, 1965 (Act), the Articles of Association of the Company, other applicable laws, guidelines, rules and regulations, and the approvals of the relevant governmental/regulatory authorities, the Directors be and are hereby authorised, pursuant to Section 132D of the Act, to allot and issue shares in the Company at any time until the conclusion of the next Annual General Meeting and upon such terms and conditions and for such purposes as the Directors may, in their absolute discretion deem fit, provided that the aggregate number of shares to be issued does not exceed ten percent (10%) of the issued share capital of the Company for the time being.” Resolution 14 i. To consider and, if thought fit, pass the following Ordinary Resolution:- Proposed Renewal of Share Buy-Back Authority “THAT, subject always to the Companies Act, 1965 (Act), the Articles of Association of the Company, other applicable laws, guidelines, rules and regulations, and the approvals of the relevant governmental/regulatory authorities, the Company be and is hereby authorised to purchase such amount of ordinary shares of RM0.50 each in the Company (Proposed Share Buy-Back) as may be determined by the Directors of the Company from time to time through Bursa Malaysia Securities Berhad upon such terms and conditions as the Directors may deem fit and expedient in the interests of the Company provided that:- i. the aggregate number of ordinary shares which may be purchased and/or held by the Company as treasury shares shall not exceed ten percent (10%) of the issued and paid-up ordinary share capital of the Company at the time of purchase; and ii. the maximum funds to be allocated by the Company for the purpose of purchasing its own shares shall not exceed the total retained profits and share premium of the Company at the time of purchase; AND THAT, upon completion of the purchase by the Company of its own shares, the Directors of the Company be authorised to deal with the shares so purchased in their absolute discretion in the following manner:- i. to retain the ordinary shares in the Company so purchased by the Company as treasury shares; and/or ii. to cancel them; and/or iii. to resell them; and/or iv. to distribute them as share dividends; and/or in any other manner as prescribed by the Act, rules, regulations and orders made pursuant to the Act and the Main Market Listing Requirements of Bursa Malaysia Securities Berhad and any other relevant authority for the time being in force; AND THAT, such authority conferred by this resolution shall commence upon the passing of this resolution and shall continue to be in force until:- i. the conclusion of the next Annual General Meeting (AGM) of the Company following this AGM, at which time the said authority shall lapse, unless by an ordinary resolution passed at that meeting, the authority is renewed, either unconditionally or subject to conditions; or ii. the expiration of the period within which the next AGM is required by law to be held; or iii. the authority is revoked or varied by ordinary resolution passed by the shareholders of the Company in a general meeting, whichever is the earliest; AND THAT, the Directors of the Company or any of them be authorised to take all such steps as are necessary or expedient to implement, finalise and give full effect to the Proposed Share Buy-Back with full powers to assent to any conditions, modifications, variations and/or amendments as may be imposed by the relevant authorities.” Resolution 15 SIME DARBY BERHAD ANNUAL REPORT 2009 4 NOTICE OF ANNUAL GENERAL MEETING j.