2020 2020

Annual Report Annual Report The Journey Continues... The Journey BUILDING THE RIGHT THING RIGHT THE BUILDING

YTL CORPORATION BERHAD Annual Report 2020 CONTENTS

CORPORATE REVIEW

02 Chairman’s Statement 04 Managing Director’s Review 07 Management Discussion & Analysis 37 Managing Sustainability 39 Corporate Events 41 Notice of Annual General Meeting 44 Statement Accompanying Notice of Annual General Meeting 45 Corporate Information 46 Profile of the Board of Directors 51 Profile of Key Senior Management 52 Statement of Directors’ Responsibilities 53 Audit Committee Report 56 Nominating Committee Statement 61 Corporate Governance Overview Statement 69 Statement on Risk Management & Internal Control 73 Analysis of Shareholdings 75 Statement of Directors’ Interests 78 List of Properties Company No. 198201012898 (92647-H)

FINANCIAL STATEMENTS

81 Directors’ Report 91 Statement by Directors 91 Statutory Declaration 92 Independent Auditors’ Report 100 Income Statements 101 Statements of Comprehensive Income 102 Statements of Financial Position 104 Statements of Changes in Equity 106 Statements of Cash Flows 110 Notes to the Financial Statements

• Form of Proxy YTL CORPORATION BERHAD

Chairman’s Statement

TAN SRI DATO’ YTL Corporation Berhad (“YTL Corp”) and (DR) FRANCIS its subsidiaries (“Group”) posted a 6% YEOH SOCK PING increase in revenue to RM19.2 billion for KBE, CBE, FICE the financial year ended 30 June 2020, Executive Chairman contributed mainly by our construction and cement segments. After eliminating the losses arising from fair value changes, impairments and inventory write-downs of RM218.6 million, the Group recorded profit before tax of RM637.9 million for the current financial year.

The Malaysian economy registered lower gross domestic product (GDP) growth of 4.3% for the 2019 calendar year compared to 4.7% in 2018, impacted by weaker external demand and investment activity, as well as supply disruptions in the commodities sector. The economy contracted by 0.7% in the first quarter and 17.1% in the second quarter of 2020, resulting from the concurrent supply and demand shocks due to weak external conditions and the strict measures implemented to contain the COVID-19 pandemic (sources: Ministry of Finance Malaysia, Bank Negara Malaysia updates & reports).

Meanwhile, in other major economies in which the Group operates, the United Kingdom registered GDP growth of approximately 1.5% during 2019, with the economy contracting by an estimated 2.2% and 20.4%, respectively, in the first and second quarters of the 2020 calendar year. Singapore’s economy showed growth of 0.7% in 2019, followed by contractions of 0.3% and 13.2%, respectively, in the first and second quarters of the 2020 calendar year (sources: Ministry of Finance Malaysia, Singapore Ministry of Trade & Industry, UK Office for National Statistics updates & reports).

02 ANNUAL REPORT 2020

Chairman’s Statement

The outbreak of the COVID-19 pandemic has not Our Group’s long-term growth and development spared any country or industry, necessitating strategies, centred around geographic the closure of borders, the imposition of diversification and expansion of our revenue movement control orders and restrictions on the base, focusing on regulated utility assets provision of non-essential services across the providing essential services and other core globe. The last four months of the financial year, businesses such as cement and construction, covering the period from March to June 2020, served us well this year, facilitating our ability encompassed some of the most stringent to function even at restricted levels and providing measures, hampering the operations of parts of the necessary protection and stability to the our businesses during various periods. Group in the face of unpredictable global events.

However, our utilities division has stood as a We remain committed to the prudent financial bulwark, continuing to operate throughout the management that has fortified our Group in control period as the businesses all provide times of uncertainty. Our financial structure will essential services – water, electricity and continue to be safeguarded by our long-standing telecommunications. Our cement and construction policy of maintaining cash reserves and financing businesses also returned to operation relatively acquisitions on a ring-fenced, non-recourse basis expeditiously, whilst our hotels have started to that ensures the stand-alone viability of the see recovery particularly from domestic travellers business. This structure is further bolstered by holidaying within the country. our regulated assets which deliver asset values that increase over time and optimise capital In order to ensure that shareholders will continue expenditure, in addition to flowing up dividends to be rewarded with healthy dividend yields, from operational activities. whilst enabling our Group to conserve cash to provide increased flexibility and options to We will continue to improve on our track record optimally manage our existing businesses and and ensure that our ventures are sustainable invest in future opportunities, YTL Corp declared over the long-term in order to deliver returns a 1-for-30 share dividend with an entitlement to our shareholders, protect the livelihoods of date of 28 October 2020. This represents a the employees who form the backbone of our dividend yield of about 3.3% based on the Group, offer world class products and services average share price for the year of RM0.89 per at competitive prices to our customers and share. YTL Corp has a consistent dividend track advance the communities where we operate. record and has declared dividends to shareholders for 36 consecutive years since listing on the Kuala Lumpur stock exchange in 1985. TAN SRI DATO’ (DR) FRANCIS YEOH SOCK PING PSM, KBE, CBE, FICE, SIMP, DPMS, DPMP, JMN, JP

03 YTL CORPORATION BERHAD

Managing Director’s Review

DATO’ YEOH SEOK KIAN Managing Director

FINANCIAL OVERVIEW YTL Corp declared a share dividend in respect of the financial year under review comprising a distribution of 1 treasury share for every Businesses across the globe faced unprecedented operational 30 ordinary shares in the Company held as at the entitlement date challenges following the outbreak of the COVID-19 pandemic in of 28 October 2020. early 2020. Countries where YTL Corporation Berhad (“YTL Corp” or “Company”) and its subsidiaries (“Group” or “YTL Corp Group”) In the Group’s key Utilities division, higher revenue in the water operate implemented various movement control orders and limited and sewerage sub-segment in the United Kingdom (UK) was the operation of non-essential services. primarily due to differing weather conditions leading to changes in supply volumes and partially offset by a price decrease determined However, the Group’s businesses have been cushioned by its by the industry regulator. Lower profit before tax resulted mainly Utilities segment which provides essential services that have from a higher allowance for impairment of receivables due to the continued to operate throughout the control period. The construction potential impact of the pandemic on customers, as well as the and cement segments re-commenced in stages as permitted and price decrease. However, once such impairments are realised, the operations have normalised, whilst the Group’s property and hotels UK regulatory regime allows for recovery of these amounts against segments have faced slower recovery in light of the effects of future tariffs. pandemic restrictions on the hospitality, retail and property sectors. The merchant multi-utilities sub-segment in Singapore registered The Group recorded revenue of RM19.2 billion for the financial lower revenue due to the decrease in fuel oil prices and lower year ended 30 June 2020 compared to RM18.0 billion for the units sold, partially offset by higher sales of fuel oil, whilst the financial year ended 30 June 2019, and profit before taxation of loss before tax narrowed due mainly to the absence of a one-off RM419.3 million for the financial year under review, compared to charge for impairment of receivables recognised last year, as well RM1,036.5 million last year. as lower finance costs and higher retail and tank leasing margins this year.

04 ANNUAL REPORT 2020

Managing Director’s Review

In Malaysia, performance of the contracted power generation In the Property Investment & Development division, revenue division remained stable due to supply from Paka Power Station declined due mainly to the deconsolidation of Starhill Global REIT, under the current power purchase agreement. Meanwhile, the as well as lower sales recorded in completed projects. The division telecommunications business recorded lower revenue and a higher saw a higher loss before tax due to losses on sales of completed loss before tax due to lower project revenues recorded. units and qualifying certificate extension fees relating to 3 Orchard By-The-Park, as well as its share of fair value losses on investment The Utility division’s minority investments, comprising a 33.5% properties under Starhill Global REIT. stake in ElectraNet Pty Ltd, which owns and operates South Australia’s electricity transmission network, and an effective interest The financial performance of the Hotel Operations segment was of 20% in PT Jawa Power, the owner of a 1,220 megawatt coal- significantly impacted amid the challenging conditions and disruptions fired power station in Indonesia, also continued to perform well caused by the COVID-19 pandemic. Countries where the Group’s for the year under review. hospitality businesses are situated instituted varying measures including closure of international borders and restrictions on the The Cement Manufacturing & Trading segment saw an increase size of gatherings which heavily dampened MICE (meetings, in revenue resulting primarily from consolidation of Malayan Cement incentives, conferences, exhibitions) activities. Berhad, which the Group acquired in mid-2019, whilst the loss before tax was mainly due to a higher allowance for impairment In the Group’s Management Services & Others division, revenue of receivables and higher finance costs related to the Malayan decreased mainly as a result of lower investment and interest Cement acquisition. income caused by declining interest rates in most jurisdictions where the Group operates. Profit before tax increased primarily Meanwhile, the Group’s Construction segment achieved increases due to a one-off gain on deconsolidation of Starhill Global REIT. in revenue and profit before tax for the financial year under review on the back of significant progress in construction works, centred The Information Technology & e-Commerce Related Business mainly on the ongoing Gemas-Johor Bahru electrified rail link. segment saw a decrease in revenue from lower revenue in the content and digital media sub-segment impacted by the ongoing pandemic.

05 YTL CORPORATION BERHAD

Managing Director’s Review

NEW DEVELOPMENTS & GROWTH In the UK, the Group broke ground on the first development of OPPORTUNITIES 278 homes in Brabazon, Bristol, during the year. Brabazon, a new mixed use commercial and residential neighbourhood, is the Group’s The Group entered into an agreement in March 2020 to acquire first foray into the UK property sector. The Group is highly familiar the power plant and associated assets of Tuaspring Pte Ltd in with the area, having been present there since 2002 when the Singapore for a total purchase consideration of SGD331.45 million. Group acquired Wessex Water, which is headquartered a short Upon completion, the plant will be integrated into the existing distance away in Bath and encompasses Bristol as part of its businesses, enabling the Group to consolidate its power generation operating region. capacity in Singapore.

The necessary planning approvals were also received this year to In Jordan, Attarat Power Company PSC (“APCO”), in which the proceed with YTL Arena at the Brabazon Hangars, which will be a Group has a 45% stake, continued to progress with construction premier live entertainment venue with a 17,080 capacity, making of its 554 megawatt oil shale-fired power generation project. it the third largest arena in the UK after Manchester and London. However, travel and movement restrictions imposed by the Government of Jordan following the outbreak of the pandemic have delayed the project and APCO has invoked force majeure LOOKING AHEAD provisions under its power purchase agreement, which remain in effect at the present time. YTL Corp has taken great effort to mitigate the effects of the ongoing COVID-19 pandemic and proactively address developments The Group also continued to work towards financial close of its in order to best manage the effects on its businesses, as well as 80%-owned 2x660 megawatt coal-fired power project in Indonesia, seek out worthwhile growth opportunities. Despite the challenging which has a 30-year power purchase agreement with Indonesia’s outlook, the Group expects the performance of its business segments state-owned electricity utility. to remain resilient, as these segments’ operations are substantially essential in nature, and will continue to closely monitor the related risks and impact on all business segments.

DATO’ YEOH SEOK KIAN DSSA

06 ANNUAL REPORT 2020

Management Discussion & Analysis GROUP OVERVIEW

OVERVIEW

The principal activities of YTL Corporation Berhad (“YTL Corp” or “Company”) are those of an investment holding and management company. The key reporting segments of YTL Corp and its subsidiaries (“YTL Corp Group” or “Group”) are Utilities, Cement Manufacturing & Trading, Construction, Property Investment & Development, Hotel Operations, Management Services & Others and Information Technology (“IT”) & e-Commerce Related Business.

YTL Corp is an integrated infrastructure developer domiciled in Malaysia, with extensive international operations in the United Kingdom (UK) and Singapore, as well as businesses and projects under development in other countries including Indonesia, Australia, Japan, Jordan and China.

Revenue by Country – FY2020

U 19% RM3.65 billion 36% RM6.84 billion O Revenue 6% R RM1.26 billion

39% RM7.43 billion

YTL Corp is amongst the largest companies listed on the Main Market of Bursa Malaysia Securities Berhad (“Bursa Securities”). YTL Corp has also had a secondary listing on the Tokyo Stock Exchange since 1996 and was the first non-Japanese Asian company to list on the Tokyo exchange.

YTL Corp’s subsidiaries listed on the Main Market of Bursa Securities are YTL Power International Berhad (“YTL Power”), YTL Hospitality REIT (“YTL REIT”) and Malayan Cement Berhad (“Malayan Cement”). The Group also has a stake in Starhill Global Real Estate Investment Trust (“Starhill Global REIT”), which is listed on the Mainboard of the SGX-ST, the Singapore stock exchange.

YTL Corp is also component of the FTSE4Good Bursa Malaysia Index, which is an index designed to measure the performance of companies demonstrating good Environmental, Social and Governance (ESG) practices.

07 YTL CORPORATION BERHAD

Management Discussion & Analysis GROUP OVERVIEW

OBJECTIVES & STRATEGIES • Growth and enhancement of the YTL Corp Group’s core businesses The YTL Corp Group pursues the geographic diversification and expansion of its revenue base through greenfield developments The Group’s strategy to grow its businesses is to leverage its and strategic acquisitions both domestically and overseas, focusing expertise in its core competencies, particularly in the areas of on regulated utility assets and other businesses correlated to its power generation (in both contracted and merchant markets), core competencies of cement, construction, property development water and sewerage services, merchant multi-utility services, and hotel operations, with the goal of maximising shareholder communications, construction contracting, property development value and building and operating strong businesses that are viable and investment, manufacturing of cement and other industrial and sustainable on a long-term basis. products and supplies, hotel development and management (including restaurant operations), and the provision of The YTL Corp Group also derives a significant part of its revenue consultancy, incubating and advisory services for internet from operating various regulated utility assets under long-term businesses and internet-based education solutions and services. concessions and/or licenses, enabling the Group to achieve stable earnings and mitigate the downside risks arising from economic In implementing its strategy, the Group focuses strongly on uncertainties and changing operating conditions, both in Malaysia governance, compliance and managing the economic, and globally. environmental and social impacts of its businesses to ensure the long-term sustainability and viability of its operations. The principal components of the YTL Corp Group’s strategy comprise: • Ongoing optimisation of the Group’s capital structure

• Diversification and expansion of the Group’s revenue The YTL Corp Group maintains a balanced financial structure base through greenfield developments and strategic by optimising the use of debt and equity financing and ensuring acquisitions in Malaysia and overseas, particularly in the availability of internally generated funds and external the area of regulated utilities financing to capitalise on acquisition opportunities. The YTL Corp Group pursues a strategy of acquiring regulated assets operating under long-term concessions and other A key component of the Group’s growth strategy is its practice businesses correlated to its core competencies. The Group’s of funding the debt component of its acquisitions and greenfield regulated utilities demonstrate ongoing growth, with the projects largely through non-recourse financing which has regulated asset value of these assets increasing over time. The ensured that the Group only invests in projects that are Group’s existing overseas operations in this area continue to commercially viable on a stand-alone basis. generate steady returns and its overseas acquisitions diversify income streams and enable the Group to avoid single-country • Enhancement of operational efficiencies to maximise and single-industry risks. returns from the Group’s businesses and expand its customer base

The Group believes that its cement and power plants on average operate within the highest efficiency levels of their industries and further enhances operational efficiencies where possible through the application of new technologies, production techniques and information technology.

08 ANNUAL REPORT 2020

Management Discussion & Analysis GROUP OVERVIEW

PERFORMANCE INDICATORS

YTL Corp has been listed on Bursa Securities, the Kuala Lumpur stock exchange, since 3 April 1985. YTL Corp is listed on the Main Market of the exchange under the Gas, Water & Multi-Utilities sub-sector of the Utilities sector.

The graph below illustrates the performance of YTL Corp’s share price compared with the FTSE Bursa Malaysia KLCI during the financial year ended 30 June 2020.

P TL P TE L

YTL Corp FTSE Volume Weighted Average Price Bursa Malaysia (RM per Share) KLCI 1.10 1,700

1.00 1,600

0.90 1,500

0.80 1,400

YTL Corp 0.70 1,300 FTSE Bursa Malaysia KLCI

0.60 1,200 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20

TL T

YTL Corp Share Volume 180M

160M

140M

120M

100M

80M

60M

40M

20M

0 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20

Source: Bloomberg 09 YTL CORPORATION BERHAD

Management Discussion & Analysis

FINANCIAL REVIEW

FINANCIAL HIGHLIGHTS

2020 2019 2018 2017 2016

Revenue (RM’000) 19,178,449 18,047,528 15,890,147 14,728,681 15,377,505

Profit Before Taxation (RM’000) 419,294 1,036,507 1,335,740 1,725,512 2,262,531

Profit After Taxation (RM’000) 4,658 721,355 970,872 1,442,050 1,886,958

(Loss)/Profit for the Year Attributable (189,221) 242,589 340,999 813,308 916,431 to Owners of the Parent (RM’000)

Total Equity Attributable 12,460,336 13,262,686 14,041,932 14,800,949 14,603,479 to Owners of the Parent (RM’000)

(Loss)/Earnings per Share (Sen) (1.78) 2.30 3.24 7.74 8.80

Dividend per Share (Sen) – 4.0 5.0 9.5 9.5

Total Assets (RM’000) 69,908,435 76,727,093 71,344,380 74,626,713 67,266,819

Net Assets per Share (RM) 1.17 1.25 1.32 1.40 1.40

Revenue Profit Before Taxation Profit After Taxation (RM’000) (RM’000) (RM’000) 419,294 15,377,505 14,728,681 15,890,147 18,047,528 19,178,449 2,262,531 1,725,512 1,335,740 1,036,507 1,886,958 1,442,050 970,872 721,355 4,658

2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020

(Loss)/Profit for the Year Attributable Total Equity Attributable (Loss)/Earnings Per Share to Owners of the Parent to Owners of the Parent (Sen) 10 (RM’000) (RM’000) 916,431 813,308 340,999 242,589 (189,221) 8.80 7.74 3.24 2.30 (1.78) 14,603,479 14,800,949 14,041,932 13,262,686 12,460,336

2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020

Dividend Per Share Total Assets Net Assets Per Share (Sen) (RM’000) (RM) 9.5 9.5 5.0 4.0 – 67,266,819 74,626,713 71,344,380 76,727,093 69,908,435 1.40 1.40 1.32 1.25 1.17

2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 Revenue Profit Before Taxation Profit After Taxation (RM’000) (RM’000) (RM’000)

ANNUAL REPORT 2020 419,294 Management Discussion & Analysis

15,377,505 14,728,681 15,890,147 18,047,528 19,178,449 2,262,531 1,725,512 1,335,740 1,036,507 1,886,958 FINANCIAL1,442,050 970,872 721,355 REVIEW4,658 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020

(Loss)/Profit for the Year Attributable Total Equity Attributable (Loss)/Earnings Per Share to Owners of the Parent to Owners of the Parent (Sen) (RM’000) (RM’000) 916,431 813,308 340,999 242,589 (189,221) 8.80 7.74 3.24 2.30 (1.78) 14,603,479 14,800,949 14,041,932 13,262,686 12,460,336

2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020

Dividend Per Share Total Assets Net Assets Per Share (Sen) (RM’000) (RM) 9.5 9.5 5.0 4.0 – 67,266,819 74,626,713 71,344,380 76,727,093 69,908,435 1.40 1.40 1.32 1.25 1.17

2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020

11 YTL CORPORATION BERHAD

Management Discussion & Analysis FINANCIAL REVIEW

REVIEW OF FINANCIAL PERFORMANCE

Group Financial Performance

The YTL Corp Group recorded revenue of RM19,178.4 million for the financial year ended 30 June 2020 compared to RM18,047.5 million for the financial year ended 30 June 2019. The increase in revenue was due mainly to the Construction and Cement Manufacturing & Trading segments.

The Group recorded profit before taxation of RM419.3 million for the financial year under review, compared to RM1,036.5 million recorded for the previous financial year ended 30 June 2019.

The Group also recognised one-off deferred tax expenses of RM162.4 million due to the re-measuring of deferred tax balances as at 30 June 2020, which contributed to the lower profit after tax of RM4.7 million this year. These expenses arose from the increase in the UK corporation tax rate from 17% to 19% for 2020-21 after repeal of the previous legislation that had reduced the rate to 17%.

The Group’s foreign operations continue to be largest contributors, with overseas operations accounting for approximately 61.3% of the Group’s revenue and 71.8% of non-current assets for the 2020 financial year, compared to 68.1% and 78.8%, respectively, last year.

Segmental Financial Performance

Breakdown of Total Assets by Segment (as at 30 June 2020)

P T 14% 13% RM9.70 billion RM9.28 billion

O 4% RM2.74 billion

Total Assets U R O 48% 19% RM33.70 billion RM13.21 billion

2% RM1.19 billion T R 0% RM0.09 billion

12 ANNUAL REPORT 2020

Management Discussion & Analysis FINANCIAL REVIEW

Breakdown of Revenue by Segment Breakdown of Profit/(Loss) Before Tax by Segment – FY2020 (RM million) – FY2020 (RM million)

– 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000 (400) (200) – 200 400 600 800

Utilities Property Investment & Development Management Services & Others IT & e-Commerce Related Business Cement Manufacturing & Trading Hotel Operations Construction

Segment Profit/(Loss) Segment Revenue Before Tax

2020 2019 2020 2019 RM million RM million RM million RM million

Utilities 10,275.1 11,367.2 233.6 625.3 Cement Manufacturing & Trading 4,095.2 2,674.3 (2.4) 145.4 Construction 2,316.0 1,219.5 194.7 80.5 Property Investment & Development 995.2 1,103.3 (282.8) (8.8) Hotel Operations 1,121.7 1,223.4 96.6 176.6 Management Services & Others 371.7 456.0 179.6 14.9 IT & e-Commerce Related Business 3.5 3.8 – 2.6

19,178.4 18,047.5 419.3 1,036.5

Utilities Cement Manufacturing & Trading

The Utilities segment recorded lower revenue and segment profit The Cement Manufacturing & Trading segment recorded higher before taxation of RM10,275.1 million and RM233.6 million revenue of RM4,095.2 million and loss before taxation of RM2.4 respectively for the financial year ended 30 June 2020 compared million for the financial year ended 30 June 2020 compared to to revenue of RM11,367.2 million and profit before taxation of revenue of RM2,674.3 million and profit before taxation of RM145.4 RM625.3 million for the financial year ended 30 June 2019. million for the financial year ended 30 June 2019.

The decrease in revenue and profit was mainly due to lower profit The increase in revenue was primarily the result of consolidation in the water and sewerage sub-segment and the loss recorded in of Malayan Cement, whilst the loss before taxation was mainly due to higher allowance for impairment of receivables and higher the telecommunications business division, partially offset by better finance costs related to the acquisition of Malayan Cement. performance in the merchant multi-utilities business sub-segment.

For the current financial year, the Cement Manufacturing & Trading The Utilities segment continues to be the Group’s largest operating segment was the Group’s second largest operating segment, segment, contributing 53.6% of revenue and 55.7% of profit contributing 21.4% of revenue for the financial year ended before taxation for the financial year ended 30 June 2020, compared 30 June 2020, compared to 14.8% last year. to 63.0% of revenue and 60.3% of profit before tax last year.

13 YTL CORPORATION BERHAD

Management Discussion & Analysis FINANCIAL REVIEW

Construction Management Services & Others

The Construction segment recorded higher revenue of RM2,316.0 The Management Services & Others segment recorded lower million and profit before taxation of RM194.7 million for the financial revenue of RM371.7 million and higher profit before taxation of year ended 30 June 2020 compared to revenue of RM1,219.5 million RM179.6 million for the financial year ended 30 June 2020 compared and profit before taxation of RM80.5 million for the financial year to revenue of RM456.0 million and profit before taxation of RM14.9 ended 30 June 2019. million for the financial year ended 30 June 2019.

The increase in revenue and profit before taxation for the financial The decrease in revenue was mainly due to lower distribution year under review was due to the significant progress in construction income from investments and the drop in interest income following works. the fall in interest rates in most jurisdictions where the Group operates. Profit before tax increased primarily due to a one-off Property Investment & Development gain on deconsolidation of Starhill Global REIT.

The Property Investment & Development segment recorded lower IT & e-Commerce Related Business revenue of RM995.2 million and loss before taxation of RM282.8 million for the financial year ended 30 June 2020 compared to The IT & e-Commerce Related Business segment recorded a slightly revenue of RM1,103.3 million and loss before taxation of RM8.8 lower revenue of RM3.5 million and lower profit before taxation million for the financial year ended 30 June 2019. of RM0.04 million for the financial year ended 30 June 2020 compared to revenue of RM3.8 million and profit before taxation The decrease in revenue was primarily due to the deconsolidation of RM2.6 million for the financial year ended 30 June 2019. of the results of Starhill Global REIT, in which the Company and its subsidiary companies in aggregate hold an effective interest The decrease in revenue was mainly due to lower revenue recorded of 36.74%, as well as lower sales recorded in completed projects. by the content and digital media sub-segment, following the impact The higher loss before tax was mainly the result of the recognition of COVID-19 pandemic. of losses on sale of completed units and qualifying certificate extension fees incurred in relation to the 3 Orchard By-The-Park project and share of fair value losses on investment properties DIVIDENDS recorded by Starhill Global REIT. The dividend paid since the end of the last financial year is as follows: Hotel Operations

The Hotel Operations segment recorded lower revenue of RM1,121.7 RM'000 million and profit before taxation of RM96.6 million for the financial year ended 30 June 2020 compared to revenue of RM1,223.4 In respect of the financial year ended million and profit before taxation of RM176.6 million for the financial 30 June 2019: year ended 30 June 2019. – Interim dividend of 4 sen per ordinary share paid on 13 November 2019 426,770 The segment’s revenue and profit before taxation was significantly affected by lower operating results from most of the Group’s hotel Dividend Policy businesses amid extremely challenging conditions due to the unprecedented disruption caused by the COVID-19 pandemic. The Board of Directors of YTL Corp has not adopted a set dividend Borders in most jurisdictions in which the hospitality businesses policy. It is the present intention of the Directors to continue to operate were closed to foreign travellers, coupled with restrictions propose the payment of cash dividends on an annual basis, subject on seminars and meetings due to physical distancing measures to future earnings and the financial condition of YTL Corp and and adherence to the standard operating procedures issued by other factors, including the profit and cash flow position of the governments in these jurisdictions. YTL Corp Group, restrictions imposed by law or under credit facilities on the payment of dividends by members of YTL Corp Group and the availability of funds.

14 ANNUAL REPORT 2020

Management Discussion & Analysis FINANCIAL REVIEW

Distribution of Treasury Shares

On 28 August 2020, YTL Corp announced a distribution of treasury shares on the basis of one (1) treasury share for every thirty (30) ordinary shares held. The book closure date for the distribution was 28 October 2020 and the treasury shares will be credited into the CDS account of entitled shareholders within 10 market days of the book closure date.

CAPITAL MANAGEMENT

The primary objective of the Group’s capital management is to ensure that it maintains healthy capital ratios in order to support its business and maximise shareholder value. Debts undertaken by the Group’s operating entities are substantially non-recourse to the Company.

The Group manages its capital structure and adjusts it in the light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. There were no changes in the Group’s approach to capital management during the year.

The Group monitors capital using a debt-to-equity ratio, which is net debt divided by total capital plus net debt. The Group includes within net debt, total borrowings less cash and cash equivalents. Capital includes equity attributable to the owners of the parent.

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Bonds 19,875,639 19,481,690 2,500,000 2,510,000 Borrowings 23,690,239 26,598,098 1,750,654 1,467,970

Bonds and borrowings 43,565,878 46,079,788 4,250,654 3,977,970 Less: Cash and cash equivalents (11,661,232) (11,806,502) (103,999) (321,308)

Net debt 31,904,646 34,273,286 4,146,655 3,656,662

Equity attributable to owners of the parent 12,460,336 13,262,686 6,086,744 6,228,889

Capital and net debt 44,364,982 47,535,972 10,233,399 9,885,551

Debt-to-equity ratio 72% 72% 41% 37%

Under Practice Note 17 of the Main Market Listing Requirements of Bursa Securities (“MMLR”), the Company is required to maintain consolidated shareholders’ equity equal to or not less than the 25% of the issued capital (excluding treasury shares) and such shareholders’ equity is not less than RM40 million. The Company has complied with this requirement with total consolidated equity attributable to owners of the parent as at 30 June 2020 of RM12.5 billion.

15 YTL CORPORATION BERHAD

Management Discussion & Analysis

SIGNIFICANT CORPORATE DEVELOPMENTS

PROPOSED ACQUISITION OF HOTEL IN MADRID PROPOSED ACQUISITION OF THE POWER PLANT AND ASSOCIATED ASSETS OF TUASPRING PTE As reported last year, on 6 December 2018, YTL Hotels & Properties LTD (“TUASPRING”) Sdn Bhd, a wholly-owned subsidiary of YTL Corp, entered into a Sale and Purchase Agreement (“SPA”) with KKH Property Investors, On 12 March 2020, YTL Power and Taser Power Pte Ltd, entered SLU (“Seller”) to acquire the entire share capital of SOL HTL Project, into a put and call option agreement for the proposed acquisition SLU (“SOL HTL”), a company incorporated in Madrid, Spain, and of the power plant and associated assets of Tuaspring by YTL certain loans owing by SOL HTL to the Seller for an aggregate PowerSeraya Pte Ltd (“YTL PowerSeraya”), from the receivers and consideration of EUR220 million, as adjusted. managers of Tuaspring for a total purchase consideration of SGD331.45 million to be settled as to SGD230.0 million in cash and The parties subsequently agreed to amend the SPA to incorporate SGD101.45 million comprising ordinary shares and loan notes the right of either party to terminate the SPA where the conditions amounting to 7.54% of the post-acquisition equity in YTL Utilities to the effectiveness of the SPA (“Effectiveness Conditions”) had (S) Pte Ltd, the immediate holding company of YTL PowerSeraya. not been satisfied or waived, provided that the SPA would terminate automatically if the Effectiveness Conditions were not satisfied or The approval for the proposed acquisition from the Energy Market waived by 31 December 2019. The parties then agreed for the Authority of Singapore was received on 20 May 2020. Completion SPA to lapse on 31 December 2019 due to non-fulfilment of the is conditional inter alia on approval of the Public Utilities Board of Effective Conditions. Singapore and completion of financing.

SHARE EXCHANGE OFFER FOR YTL LAND & ESTABLISHMENT OF NEW EMPLOYEES SHARE DEVELOPMENT BERHAD (“YTL L&D”) OPTION SCHEME (“ESOS”)

As reported previously, on 13 June 2019, YTL Corp undertook a On 29 April 2020, it was announced that the Company proposed share exchange offer to acquire all the remaining ordinary shares to establish and implement a new ESOS for eligible employees and (excluding treasury shares) and outstanding irredeemable directors of the Company and/or its subsidiaries. convertible unsecured loan stocks 2011/2021 (“ICULS”) issued by YTL L&D not already owned by YTL Corp to be satisfied through There is an existing ESOS in place by the Company that was the issuance of new ordinary shares in YTL Corp at an issue price implemented on 1 April 2011 with a duration of 10 years which of RM1.14 each. will be expiring on 31 March 2021.

Upon closing of the offer on 7 October 2019, YTL Corp had received In accordance with the provisions of the MMLR, a listed issuer may valid acceptances resulting in it holding approximately 90.45% of implement more than one scheme provided that the aggregate the total YTL L&D shares in issue (excluding treasury shares) and number of new ordinary shares in the Company available under all 91.04% of the total outstanding ICULS. In accordance with schemes does not exceed 15% of the Company’s total number of Paragraph 16.02(3) of the MMLR, Bursa Securities suspended the listed issued shares (excluding treasury shares) at any one time. trading of the securities of YTL L&D commencing 15 October 2019, being the expiry of 5 market days from the final closing date of On 18 June 2020, Bursa Securities granted the Company an 7 October 2019. extension of time until 16 November 2020 to issue the circular in relation to the proposed ESOS. The Company intends to convene Pursuant to Paragraph 16.07(a) of the MMLR, all listed securities the extraordinary general meeting for the proposed ESOS on the of YTL L&D were removed from the Official List of Bursa Securities same day as its forthcoming annual general meeting. with effect on 21 October 2019.

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Management Discussion & Analysis

SEGMENTAL REVIEW

UTILITIES

SEGMENT OVERVIEW YTL Power’s current projects under development comprise an 80% equity interest in PT Tanjung Jati Power Company (“Tanjung Jati The Utilities segment of the YTL Corp Group comprises the activities Power”), an independent power producer undertaking the undertaken through its subsidiary, YTL Power, and its subsidiaries development of a 2x660 MW coal-fired power project in Indonesia, (“YTL Power Group”). As at 30 June 2020, YTL Corp held a 55.21% and a 45% equity interest in Attarat Power Company PSC (“APCO”), stake in YTL Power. The YTL Power Group has utilities businesses, which is developing a 554 MW oil shale-fired power generation investments and projects under development in Malaysia, the UK, project at Attarat um Ghudran in the Hashemite Kingdom of Jordan. Singapore, Indonesia, Jordan and Australia.

The YTL Power Group owns Wessex Water Limited (“Wessex Water”), OPERATIONAL REVIEW a water and sewerage provider in the UK, YTL PowerSeraya, which has a total licensed generation capacity of 3,100 megawatts (“MW”) Power Generation (Contracted) and multi-utility operations in Singapore, and YTL Power Generation YTLPG Sdn Bhd (“YTLPG”), an independent power producer in Malaysia. YTL YTLPG was the first IPP (independent power producer) in Malaysia Power also has a 60% stake in YTL Communications Sdn Bhd (“YTL in 1994, operating under a 21-year power purchase agreement, Comms”), the operator of the Yes 4G platform providing high-speed which was completed on 30 September 2015. YTLPG was subsequently mobile internet with voice services across Malaysia. awarded the project for the supply of power from Paka Power Station under a short term capacity bid called by the Malaysian Energy Commission.

Supply from Paka Power Station re-commenced on 1 September 2017 under the new power purchase agreement (“PPA”) entered into between YTLPG and Tenaga Nasional Berhad for the supply of 585 MW of capacity for a term of 3 years 10 months (an additional 12 months from the original award of 2 years 10 months) until 30 June 2021. Operation and maintenance (“O&M”) of the power station is carried out by YTL Power Services Sdn Bhd, a wholly-owned subsidiary of YTL Corp.

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Paka Power Station continued to fulfil all performance guarantees APCO has signed a 30-year power purchase agreement (including under the PPA and produced a net generation output of 2,146 construction period of 3.5 years) with the National Electric Power gigawatt hours (“GWh”) of electricity during the financial year ended Company (“NEPCO”), Jordan’s state-owned utility, for the entire 30 June 2020. For the period under review, the station’s two electrical capacity and energy of the power plant, with an option generating blocks, GB1 and GB2, achieved reliability factors of for NEPCO to extend the power purchase agreement to 40 years 98.91% and 99.84% and load factors of 53.14% and 38.27%, (from the commercial operation date of the project’s second unit). respectively. Construction has commenced on the project with the commercial Tanjung Jati Power operations for the first unit scheduled to commence in the middle of this year and the second unit in the last quarter of the year. The Group has an 80% equity interest in Tanjung Jati Power, an However, the global COVID-19 pandemic has led to a delay in the independent power producer which is undertaking the development project due to travel and movement restrictions imposed by the of Tanjung Jati A, a 2x660 MW coal-fired power project in Java, Government of Jordan. APCO has invoked the force majeure provisions Indonesia. under the power purchase agreement with NEPCO. As the effects of COVID-19 are still ongoing, the force majeure provisions are still Tanjung Jati Power has a 30-year power purchase agreement in effect. (commencing from the plant’s commercial operation date) with PT PLN (Persero), Indonesia’s state-owned electric utility company, a When it comes into operation, the 554 MW oil shale-fired power second amended and restated version of which was executed in plant will be the first power plant in Jordan to utilise its indigenous March 2018. In February 2020, Tanjung Jati Power obtained a oil shale resources which will account for approximately 15% of Business Viability Guarantee Letter from Indonesia’s Ministry of its installed power generation capacity. This will reduce the Kingdom’s Finance and is working towards achieving financial close. import of oil products for power generation, and its development

APCO is a key milestone in the Jordanian Government’s goal of furthering its energy independence. YTL Power owns a 45% equity interest in APCO, which is developing a 554 MW oil shale-fired mine-mouth power generation project in APCO is indirectly owned by YTL Power (45%), Guangdong Energy the Hashemite Kingdom of Jordan. Group of China (45%) and Eesti Energia AS of Estonia (10%).

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Management Discussion & Analysis SEGMENTAL REVIEW

improvements with higher reliability and availability percentage improvements of 0.7% and 1.4% as compared to the previous year. Reliability improvements will continue to be the key focus to ensure the generating units operate with high reliability.

The Group continued to emphasise the maintenance of high standards in quality, environmental, health and safety as well as cyber security management systems. Re-certifications of ISO9001, ISO14001, ISO45001 and ISO27001 were also successfully completed during the year.

On the retail side, YTL PowerSeraya’s retail arm, Geneco, held a market share of approximately 13.3% in the electricity retail market (calculated based on retail volume as a percentage over total system demand), comprising customers from the residential, commercial and industrial sectors, with a total sales volume of 6,581 GWh for the financial year ended 30 June 2020. Multi Utilities Business (Merchant)

YTL Power owns a 100% equity interest in YTL PowerSeraya, a In addition to electricity retail, Geneco boasts multiple product Singapore-based energy company with a total licensed generation offerings, which encompass gas and steam supply, to provide its capacity of 3,100 MW, consisting of steam turbine plants, combined- commercial and industrial customers with a comprehensive business cycle plants and co-generation combined-cycle plants. solution. The integrated energy retailer also continues to explore new business opportunities to complement the Group’s revenue Situated on Jurong Island, Singapore’s oil, gas and petrochemicals streams. hub, YTL PowerSeraya is a diversified energy company with a core business centred on the generation and retailing of electricity, in The Group’s first solar project, housed in Pulau Seraya Power addition to operating other multi-utility businesses comprising Station, supplied 100% locally generated solar power, further utilities supply (steam, natural gas and water), oil storage tank enabling Geneco to issue Renewable Energy Certificates (REC) to leasing, and oil trading and bunkering. residential and commercial customers, helping them do their part for the environment. Together with its Verified Carbon Unit (VCU) For the financial year under review, YTL PowerSeraya sold 8,028 offerings, Geneco is able to validate the use of green energy and GWh of electricity, while generation market share saw a decrease offset greenhouse gas emissions for its customers. Since the launch of 2.5% as compared to the last financial year. In addition to intense of its green energy options, there has been a steady increase in competition due to an oversupply in generation capacity in the the number of residential, commercial and industrial customers wholesale electricity market, Singapore had implemented ‘Circuit who chose Geneco to be their preferred sustainable energy provider. Breaker’ preventive measures in response to the COVID-19 pandemic from 7 April till 1 June this year. This saw Singapore’s electricity Geneco remains committed to being more than just an electricity demand take a dip, as public premises and workplaces for non- retailer, constantly seeking ways to equip its customers with essential services faced closure to curb the spread of the infection. industry trends and the latest energy solutions, and delivering excellent service and value to its consumers. Major milestones achieved by the division included the timely completion of the major and minor maintenance inspection activities on its combined cycle and co-generation power plant units. Overall plant performance for these units has shown significant

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PetroSeraya Pte Ltd, the division’s trading and fuel management During the year under review, Wessex Water was again one of the arm, managed to pull in a steady performance despite prevailing top performers in the water sector for customer service, placing challenges in the oil industry and the COVID-19 pandemic. The second of all the water and sewerage companies in Ofwat’s new company handled 7.67 million metric tonnes of fuel oil and diesel. measure of customer experience (C-MeX) trial. The division retained The number of berthings for bunkering and cargo vessels saw 656 its government Customer Service Excellence award, the British vessels berthed at the terminal during the financial year, compared Standard for inclusive services provision (BS 18477), the Keep Me to 1,086 vessels last year, with an average berth utilisation rate Posted award and the Louder than Words charter mark, as well as of 33.2%. continuing with the Institute of Customer Service’s ServiceMark with distinction. The figures are lower mainly due to challenging economic conditions. Going forward, the Group will continue to focus on strengthening Throughout the COVID-19 crisis, Wessex Water continued business- its tank leasing and fuel management activities, as well as looking as-usual service to customers and helped those in need, in addition into optimising its jetty and oil terminal operations to strengthen to providing rebates to more than 10,000 National Health Service performance. (NHS) workers required to wash their uniforms more often. The company also continued to deliver initiatives within its strategy This year, YTL PowerSeraya executed a planned migration to its for customers in vulnerable circumstances, with a 9% increase in new platform to better support staff collaboration and digitisation, the number of low-income customers receiving support with their encouraging increased digital adaption and virtual collaboration bills or debt and a 67% increase in the number registered for within the organisation. The new platform, which went live on 31 Priority Services. March 2020, also motivated staff contribution towards the adoption of the digital platform, and enabled the creation of the Generation Technology Information Library (GENTIL), a centralised library of power generation data.

Going forward, the division will also look to focusing and amplifying employee adoption in the areas concerning digitisation and automation, as well as cybersecurity. Data analytics technologies to help enhance the company’s value chain orchestration will also be a key focus, to be developed through the various groups, enabling employees to make more informed business decisions with higher efficiency and added precision.

Water & Sewerage

In the UK, YTL Power owns a 100% equity interest in Wessex Water, a regional water and sewerage business serving 2.8 million customers across a geographic area of approximately 10,000 square kilometres in the south west of England, including Dorset, Somerset, Bristol, most of Wiltshire and parts of Gloucestershire and Hampshire. Wessex Water is regulated by the Water Services Regulation Authority (known as Ofwat), the economic regulator for the UK water industry, and holds a license from the UK government under an instrument of appointment to supply clean water and treat and dispose of waste water from its operating region in the south west of England.

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Management Discussion & Analysis SEGMENTAL REVIEW

Wessex Water still has the lowest number of complaints of the Wessex Water remains committed to providing the highest quality water and sewerage companies, delivering this year a 4% reduction drinking water to customers and its overall compliance with drinking in billing complaints and resolving 95% of complaints the first time. water standards in 2019 was 99.97%. As part of its drive to ensure that customers are as satisfied with Wessex Water’s service as they are with service from top household In 2019-20 the number of internal flooding incidents arising from names, the division has set a target of being in the top 20 UK service issues not related to capacity was 146, compared to the division’s providers by 2025 on the Institute of Customer Service survey. target of 207. Despite the wettest February on record and the fifth wettest autumn in the UK, only two properties flooded Business customers have been able to choose their retailer for internally due to a lack of hydraulic capacity. As such, Wessex water and waste water services since 2016-17 and there are now Water’s performance remains one of the best in the industry. 22 retailers active in Wessex Water’s operating region. The company’s wholesale services team remains focused on enhancing both the Construction work has begun on the GBP60 million Trym relief retailer and customer experience. Since market opening, Wessex sewer, a 14km long tunnel providing additional capacity in West Water has improved its performance each year in both operational Bristol to tackle existing flooding issues as well as accommodating and market performance standards and these now stand at more new developments. The work will be completed in 2023. than 94%. The company has invested GPB39 million in improvements in the Wessex Water was rated as “leading” in the UK Environment area over the last five years including increased storage capacity Agency’s annual environmental performance assessment (EPA), in the sewerage network and advanced treatment (ultraviolet having reduced the number of pollution incidents to 76 and increased disinfection) at Cannington water recycling centre. the level of self-reporting of incidents to 85%. This year, 96% of bathing waters passed strict environmental standards, with two beaches (Weston-super-Mare Uphill Slipway and Burnham Jetty) continuing to be assessed as having below standard water quality.

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One of Wessex Water’s sustainability goals is to achieve net zero end of 2021. While others will be busy sunsetting their legacy 3G operational carbon emissions by 2030. To these ends, net greenhouse networks, as the only pure-4G telecommunications operator in the gas emissions fell to 117,000 tonnes carbon dioxide equivalent in nation, YTL Comms’ future-ready YES network stands poised to 2019-20 continuing a trend of reductions that began 10 years ago, serve the country’s hunger for better connectivity and its need for and is the company’s lowest annual operational carbon footprint digitisation today. since reporting began in 1997. This was achieved through a combination of energy efficiency improvements, renewable energy The onset of COVID-19 has disrupted lives globally. With the generation and the rapidly falling carbon dioxide intensity of UK implementation of the Movement Control Order (“MCO”) to stop grid electricity. the spread of infection, YTL Comms stepped up immediately to work with YTL Foundation to launch an unprecedented CSR Telecommunications Business programme to help Malaysians across the nation stay at home and learn from home. Based on feedback from the ground that many YTL Power owns a 60% stake in YTL Comms, which owns and low-income families do not even have a device for their children, operates the YES nationwide 4G LTE wireless broadband platform. the division quickly followed on with a new phase in the programme to provide free smartphones complete with free data and telephony Since the launch of YES in late 2010, YTL Comms has carried the service to help the neediest of its fellow countrymen. mantle of innovation leader in the Malaysian telecommunications industry, which started with building the right foundation as the The “Learn from Home” CSR programme has garnered tremendous first and only pure-IP pure-4G network in Malaysia. With the best traction and uplifted the lives of a whole future generation of 4G accessibility and best affordability for all, the YES network has young users. To date, YTL Comms has committed over 100,000 levelled the playing field, enabling all Malaysians to join a new era free 4G smartphones to empower them with a first-class digital of digital economy. learning experience using the YES network.

The Malaysian government’s announcement of the National Digital By positioning YTL Comms as the market leader in pricing affordability Network (JENDELA), a national infrastructure plan to elevate the for the seventh year in a row, the division saw continuous net country’s communications standards, has validated YTL Comms’ gains in its subscription base for 18 consecutive months, measuring vision and unique role as Malaysia’s industry catalyst. A key directive in double digits. under JENDELA is the sunset of the country’s 3G networks by the

The power of YTL Comms’ pure-IP and pure-4G network has even more significance in its enterprise business. As the pace towards digitisation accelerates, YTL Comms enjoys a unique position as an end-to-end service provider with complete solution delivery capability to democratise next-generation Internet of Things (IoT) solutions nationally. A highly scalable and secure private cloud is essential for mission-critical IoT solutions, along with in-house device engineering and system development and integration capabilities. The division will focus on establishing itself as Malaysia’s champion to help local businesses win in the age of Industrial Revolution 4.0.

As a brand that has always advocated the core belief that ‘Amazing Things Happen When You Say Yes’, YTL Comms will continue to play a crucial role in bridging the digital divide between rural and urban communities and a leading role in Malaysia’s transformation into a full-fledged digital economy.

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Management Discussion & Analysis SEGMENTAL REVIEW

CEMENT MANUFACTURING & TRADING

SEGMENT OVERVIEW

The YTL Corp Group’s Cement Manufacturing & Trading activities are undertaken through the YTL Cement Berhad Group of companies operating in Malaysia, Singapore, Vietnam, China and Myanmar.

OPERATIONAL REVIEW

Operations in Malaysia

The YTL Cement Group expanded its Malaysian operations with the acquisition of the majority stake in Malayan Cement (formerly, Lafarge Malaysia Berhad). The YTL Cement Group is now the leading building materials group in Malaysia, offering customers end-to-end building solutions. It has the most comprehensive network of Operations in Vietnam operations consisting of five integrated cement plants, 100 ready- mix concrete batching plants, 16 quarry sites, two drymix plants, Fico Tay Ninh Cement Joint-Stock Company (“Fico-YTL”) is one of grinding stations and cement terminals throughout Peninsular only three integrated cement plants in southern Vietnam, and a Malaysia. These facilities are connected by road, rail and sea, major cement supplier to the Ho Chi Minh and Mekong Delta regions. enabling the Group to serve its customers. Fico-YTL achieved a good operational performance and continued profitability for the year under review, owing to its superior products The Group’s Construction Development Laboratory (CDL) is Malaysia’s and cost control efforts. Operations include an integrated plant premier building materials research and development centre, and two grinding stations totaling 2.3 mtpa cement capacity. focusing on innovation and product development for evolving Operations in China construction needs. The Group’s plant in China is one of the major suppliers in the Operations in Singapore Hangzhou market. It is one of the most environmentally friendly Contribution from the Group’s operations in Singapore grew this and sustainable plants in the region. year with the acquisition of Jurong Cement Limited (formerly, Holcim Operations in Myanmar (Singapore) Limited) in 2019. Jurong Cement operates two cement terminal facilities and a drymix mortar plant. It is involved in the The Group’s cement grinding plant in Myanmar is situated in the supply of building materials, including cement and drymix mortar. Thilawa Special Economic Zone. Its strategic location next to a deep-sea port in Yangon enables it to serve Myanmar’s commercial The YTL Cement Group is now a leading supplier of cementitious hub and nearby regions. The plant is well-positioned to support products in Singapore. The Group’s cement terminals have the Myanmar’s construction needs, including large-scale infrastructure largest storage, blending and delivery capacities in the country. developments.

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CONSTRUCTION

SEGMENT OVERVIEW Meals to about 10,000 people among the underprivileged and frontliners were provided, in addition to essential items and The Construction segment of the YTL Corp Group comprises the groceries being provided to 200 members of the Johor police activities undertaken by its wholly-owned subsidiary, Syarikat community comprising widows and retirees, with refreshments Pembenaan Yeoh Tiong Lay Sdn Bhd (“SPYTL”), which is principally and iftar meals provided to police officers on duty at roadblocks involved in the construction of large-scale infrastructure including and near the project site. SPYTL worked also with YTL Foundation railway lines, highways and power plants, as well as commercial to donate three ventilators to Yayasan Sultan Ibrahim Johor for and residential properties. use in hospitals in Johor.

The Gemas-Johor Bahru rail link will form another vital component OPERATIONAL REVIEW of the country’s blueprint to develop world-class rail infrastructure. Works continued during the year under review on the Gemas-Johor Comprising 197 kilometres of double track rail lines, stations, electric Bahru electrified rail link. SPYTL, together with its joint venture trains, depots, land viaduct, bridges, electrification and signaling partner, SIPP Rail Sdn Bhd, has been appointed as the local sub- systems, upon completion, the new link will reduce the travelling contractor to carry out the design, construction, supply, installation, time between Gemas and Johor Bahru to just 90 minutes. completion, testing, commissioning and maintenance for the electrified double track project from Gemas to Johor Bahru. The project is a key part of the Malaysian Ministry of Transport’s Electrified Double Track Project (“EDTP”) initiative, intended to The completion date for the project has been extended by one reduce travelling time and traffic congestion. The EDTP’s use of year, to October 2022, due to work stoppages resulting from the electric locomotives is expected to benefit local business, delivery MCO implemented on 18 March 2020 to curb the spread of COVID-19. services and cargo services by increasing the frequency and However, the project has not incurred any cost overruns. effectiveness of services via reduced travelling time and fuel costs in comparison to land or air transport. The project also brings All parties involved in the Gemas-Johor Bahru rail link project, environmental benefits arising from the use of electric locomotives, including 11 of the SIPP-YTL joint venture’s sub-contractors and which do not emit hazardous waste and reduce fuel consumption.​ consultants participated to raise funds for the B40 group affected by the outbreak of the pandemic and assisted in distributing funds, Construction is also underway on a 30-storey office block which groceries and thousands of face masks to those in need, partnering includes shops and a food court situated along Jalan Tun Sambanthan with Johor assemblymen and members of parliament in their in Brickfields, Kuala Lumpur, due for completion in 2022. respective constituencies.

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Management Discussion & Analysis SEGMENTAL REVIEW

PROPERTY INVESTMENT & DEVELOPMENT

SEGMENT OVERVIEW The Group has worked to preserve the best of Sentul’s rich past, its natural resources and existing infrastructure while maximising The Property Investment & Development segment of the YTL Corp opportunities that come with each new development. Working Group comprises the activities undertaken by YTL L&D and its with heritage assets presents the Group with invaluable subsidiaries, YTL Developments (UK) Limited (“YTL Developments”) opportunities to create innovative concepts and enriching and Starhill Global REIT. experiences in constructive conservation which requires a unique set of skills and specialist knowledge, as well as good architectural As at 30 June 2020, YTL Corp held a 96.60% stake in YTL L&D, and construction solutions. whilst YTL Developments is a wholly-owned subsidiary of YTL Power. YTL Corp also has an effective interest of 36.74% in Starhill As the domestic property market remained soft during the year Global REIT, which is listed on the Mainboard of the SGX-ST, the under review, further exacerbated by the outbreak of the COVID-19 Singapore stock exchange. pandemic, the Group continued to focus on further enhancing the attractiveness and vibrancy of Sentul with exciting commercial components centred on conservation of its unique heritage assets. OPERATIONAL REVIEW

Property Development The Group progressed well with Sentul Works in a park during the year under review. Sentul Works involves the restoration Sentul and redevelopment of a majestic colonial building which was The urban regeneration of Sentul is undertaken by Sentul Raya formerly a British railway headquarters. Sentul Works is planned Sdn Bhd, a wholly-owned subsidiary of YTL L&D, under the Sentul to create an entirely new work experience for urbanites with a Masterplan covering a 294-acre freehold development area in design that juxtaposes the new and old, surrounded by lush Sentul, Kuala Lumpur. greenery of a park.

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Management Discussion & Analysis SEGMENTAL REVIEW

The building, which comprises four floors with a total floor space Camellia of approximately 40,000 sq ft, is being re-purposed into a natural Camellia is undertaken by PYP Sendirian Berhad, a wholly-owned heritage boutique office suitable for corporate and regional offices, subsidiary of YTL L&D. Camellia is a sanctuary of modern 2-storey start-up entrepreneurs as well as co-working space operators. The homes nestled within a leafy neighbourhood in Pakatan Jaya, raw and rustic authenticity of Sentul Works is a perfect setting Ipoh. The development caters perfectly to the needs of young for the young workforce, especially millennials seeking inspiration and growing families. Its spacious and thoughtfully designed from originality and a uniquely curated office environment. homes capture the essence of modern living with quality living spaces throughout. The project will also benefit from Sentul’s excellent rail connectivity network, being adjacent to the Sentul KTM Komuter station and The development, comprising 108 units of terrace homes on a within walking distance of the Sentul and Sentul Timur LRT stations, standard lot size of 20ft x 75ft with an extra 5-ft area at the back, as well as the upcoming Sentul West station under MRT Line 2 was completed at the end of the 2019 calendar year. which will further enhance Sentul’s livability and connectivity.

3 Orchard By-The-Park Projects in the pipeline include the d5, d2 and d8 commercial developments in Sentul East. The Group’s 3 Orchard By-The-Park project is undertaken by YTL Westwood Properties Pte Ltd, a wholly-owned subsidiary of YTL L&D.

The Group continued its marketing efforts to unlock sales of units in this boutique freehold luxury condominium on the prestigious Orchard Boulevard during the year under review.

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Management Discussion & Analysis SEGMENTAL REVIEW

Situated in the prestigious District 10 area and adjacent to the The project was shortlisted for the 2020 Housing Design Awards, world-renowned Orchard Road shopping district, 3 Orchard By-The- which is the amongst the most prestigious awards for residential Park is an exquisite collection of 77 exclusive freehold residences. developments in the UK, and is supported by all major institutions The development is located next to the upcoming Orchard Boulevard for property professionals like The Royal Institute of Chartered MRT station and walking distance from the Singapore Botanic Surveyors (RICS), The Royal Institute of British Architects (RIBA), Gardens. It is also within the vicinity of international hotels such Royal Town Planning Institute (RTPI), The Landscape Institute and as the St Regis, Four Seasons and the Regent Singapore, and medical The Chartered Institute of Architectural Technologists. centres including Camden Medical Centre and Gleneagles Hospital. In March 2020, the Group also received the necessary approvals The development won six awards at The EdgeProp Singapore to proceed with the 17,080-capacity YTL Arena to be situated in Excellence Awards 2019, the annual awards recognising the best the Brabazon Hangars on Filton Airfield. Upon completion, targeted Singapore property players and the industry benchmarks they set in 2023, YTL Arena is expected to be the third largest arena in for developments in the city state. YTL L&D was one of the biggest the UK, putting Bristol on the world stage for live music and winners of the evening receiving top accolades in the a number entertainment. of categories – Design Excellence Award (Developer & Architect), People’s Choice Award, Top Development Award, Top Luxury The site is located within a 10-minute drive from the M4 and M5 Development Award and Top Boutique Development Award. highways and Bristol Temple Meads train station, which connects passengers to London in an hour and 10 minutes. Brabazon will Brabazon also be connected to Bristol by major new transport infrastructure, including a new rail station at Brabazon connecting to Bristol The Brabazon development, located in Bristol in the UK, is being Temple Meads, a MetroBus route linking to both Cribbs Causeway undertaken by YTL Developments, a wholly-owned subsidiary of and the city centre, and a range of new walkways and cycle paths. YTL Power.

Property Investment Situated on the former Filton Airfield, the development spans a 354-acre brownfield site and will, upon completion, include residential The Group has an effective interest of 36.74% in Starhill Global homes, employment space, a mixed-use town centre, new schools, REIT which owns retail and office assets in Singapore, Malaysia, doctors’ and dentists’ surgeries, recreational spaces, sport and Australia, Japan and China. YTL Starhill Global REIT Management leisure facilities, a community centre and student housing. Limited, the manager of Starhill Global REIT, is a wholly-owned subsidiary of the Group. Starhill Global REIT’s property portfolio Construction commenced in September 2019 on the first phase of comprises stakes in Ngee Ann City and Wisma Atria in Singapore, 278 new residential properties of the Brabazon development. the David Jones building, Plaza Arcade and Myer Centre in Australia, Designed by globally renowned local architects Feilden Clegg Bradley, Starhill Gallery and parcels in Lot 10 Shopping Centre in Malaysia, the range of one- and two-bedroom apartments, and two, three- boutique retail properties in Tokyo and a retail property in China. and four-bedroom homes feature generous rooms, over-sized windows and soaring double-height spaces in selected properties. Starhill Global REIT’s property portfolio was valued at SGD2.94 billion as at 30 June 2020 compared to SGD3.06 billion as at 30 June 2019, with the decrease being largely due to lower passing and market rents in view of the softer retail outlook which was impacted by the COVID-19 pandemic. The trust’s distribution per unit was SGD0.0296 for the financial year under review, compared to SGD0.0448 last year.

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HOTEL OPERATIONS

SEGMENT OVERVIEW

The YTL Corp Group’s hotel management and development activities are undertaken primarily through its listed entity, YTL REIT, and through its wholly-owned subsidiary, YTL Hotels & Properties Sdn Bhd (“YTL Hotels”), and its subsidiaries (“YTL Hotels Group”). As at 30 June 2020, YTL Corp held a 56.95% stake in YTL REIT.

OPERATIONAL REVIEW

Hospitality and tourism sectors across the globe faced unprecedented challenges following the outbreak of the global COVID-19 pandemic this year, which has seen the imposition of restrictions on travel, closure of international borders and measures such as physical distancing that have severely impacted the MICE (meetings, incentives, conferences and exhibitions) space.

Through strategic planning, the YTL Hotels Group has undertaken mitigating measures to reduce the commercial impact of the pandemic. Cost control procedures were implemented across the Group’s operations, including a delay in non-essential capital expenditure. Overheads were streamlined, including redeploying staff members from closed assets to the resorts and other operating hotels. Various government support measures provided some relief.

The Ritz-Carlton, Kuala Lumpur, remained open throughout the MCO, ensuring that guests continued to be provided with the service for which the hotel is renowned. Most of the Group’s other hotels in Malaysia have reopened following the Recovery MCO, operating in an extremely challenging environment due to ever- changing regulations and the new procedures to protect against COVID-19. As international borders remain closed, various promotional offers and packages were marketed to attract domestic travellers. Pangkor Laut Resort, Tanjong Jara Resort and Cameron Highlands Resort have recorded sound occupancy rates since June, operating near to capacity within the restrictions imposed by the government. Gaya Island Resort remains closed whilst the situation in Sabah is being closely monitored.

The Ritz-Carlton, Kuala Lumpur, Hotel Stripes Kuala Lumpur, The Majestic Hotel Kuala Lumpur and AC Hotel Kuala Lumpur are recording good booking levels for weekend staycations. Food and beverage operations are beginning to bounce back within the limits

28 ANNUAL REPORT 2020

Management Discussion & Analysis SEGMENTAL REVIEW

imposed by the new rules. The corporate market will recover more slowly as it is still impacted by the restrictions on air travel worldwide. Business at the AC Hotel Kuantan is close to normal while AC Hotel Penang is benefiting from weekend staycations. The JW Marriott Kuala Lumpur will reopen in conjunction with the launch of the new Starhill Dining in December this year. Moving forward, there will be further challenges but the Group will continue to maintain flexibility and remain cautiously optimistic.

In the UK, The Gainsborough Bath Spa, The Glasshouse Hotel Edinburgh, Monkey Island Estate, Threadneedles and The Academy in London, all saw consistently good occupancy rates and revenue prior to the lockdown. The UK has been one of the countries hardest hit by the pandemic and, except for The Gainsborough Bath Spa, the hotels remain closed due to the ongoing unstable situation. The Gainsborough Bath Spa and Thermae Bath Spa have reopened for business and are doing well, close to the capacity allowed under the current restrictions on operations imposed by the authorities.

The Hague Marriott Hotel in The Netherlands was severely affected by the Dutch government’s imposition of restrictive measures in March. The hotel remained open and as travel restrictions were lifted from neighbouring countries in July, the hotel benefitted greatly from its coastal location, with strong growth in domestic staycation business and tourists from Germany.

In Niseko Village Japan, Higashiyama Niseko Village, the first Ritz- Carlton Reserve in Japan, will make its highly-anticipated debut in December 2020. The 50-room resort resides at the base of Mount Niseko Annupuri in Niseko Village with panoramic views of Mount Yotei and the surrounding mountain ranges. This will be YTL Hotels’ fifth property in Niseko Village. Luxury amenities include two distinctive restaurants and one lounge, a spa and onsen and a fitness centre.

The Australian properties’ performances were impacted by the COVID-19 pandemic, as a result of travel restrictions being implemented internationally and domestically, cancellations of major events as well as domestic business travel bans in order to contain the spread of the virus. The Sydney Harbour Marriott, Brisbane Marriott, Melbourne Marriott and The Westin Perth were affected in March due to the shut-down of non-essential businesses imposed by Federal and State governments. However, the situation was mitigated by the hotels’ participation in the government’s mandated quarantine programme which created occupancy and revenue. The hotels’ payrolls were also subsidised by the Australian Federal Government’s Jobkeeper scheme.

29 YTL CORPORATION BERHAD

Management Discussion & Analysis SEGMENTAL REVIEW

MANAGEMENT SERVICES & OTHERS

SEGMENT OVERVIEW

The Management Services & Others segment carries out investment holding activities and other services of the YTL Corp Group, including operation and maintenance (“O&M”) activities for power stations, cement plants and other related businesses.

These mainly comprise YTL Power Services Sdn Bhd (“YTLPS”), a wholly-owned subsidiary of YTL Corp, Express Rail Link Sdn Bhd (“ERL”), a 45%-owned associated company, and its wholly-owned subsidiary, ERL Maintenance Support Sdn Bhd, and the investment holding activities of the YTL Power Group, namely its 33.5% indirect investment in ElectraNet Pty Ltd (“ElectraNet”) and its effective interest of 20% in PT Jawa Power (“Jawa Power”).

OPERATIONAL REVIEW

ERL

ERL owns and operates the KLIA Ekspres high-speed rail link connecting Kuala Lumpur International Airport (KLIA) and KLIA2 with KL Sentral Station.

ERL welcomed its 100 millionth passenger in July 2019, although ridership was impacted from March 2020 with the implementation of the MCO and related restrictions. As at 31 August 2020, the service had carried 106.8 million passengers.

The division rolled out a ‘3Cs Awareness’ campaign in April 2020 to remind and encourage the public to practice safe distancing, good personal hygiene and to use cashless alternatives. Compulsory face masks and temperature screenings for all passengers and staff have also been enforced across the services, as well as running informative safety videos to educate and raise awareness on all trains.

ERL continued to take the lead in driving cashless initiatives on public transport by providing more payment options in the last two years. Besides online ticketing, the use of contactless cards at the gate, self-ticketing at kiosks and e-wallets at counters is encouraged. GrabPay, Boost and many other e-wallets are accepted at counters, whilst Touch ‘n Go, Visa, Mastercard, Amex, UnionPay and JCB contactless cards are also accepted at the gates.

30 ANNUAL REPORT 2020

Management Discussion & Analysis SEGMENTAL REVIEW

As at June 2020, the usage of cashless transactions on all services had reached about 56% and the division is targeting to increase this to 60% by December 2020.

ERL continues to partner with airlines, online travel agents (“OTAs”), e-wallet providers, e-commerce and B2B/wholesaler platforms to expand KLIA Ekspres sales channels globally and reach a wider audience through its platforms and communication channels. Currently, 35 partners are on board (5 airlines, 24 OTAs, 3 e-commerce platforms, 2 e-wallet providers and 1 aggregator).

During the year, ERL collaborated with Tourism Malaysia to promote the Visit Malaysia 2020 Campaign and supported the Government’s goal of achieving 30 million tourist arrivals, until the campaign was cancelled by the Government following the implementation of the MCO in March 2020.

As the country entered the recovery phase in June 2020, ERL shifted its focus to domestic tourism to help boost recovery of its ridership levels. Awareness activities are currently done on digital and social media platforms, in addition to ongoing collaboration with Tourism Malaysia and the Ministry of Tourism, Arts and Culture to promote local destinations and attractions with an emphasis on rail transport.

ERL continues to win awards for its service, receiving the Partnership of the Year Award for its efforts in expanding its B2B sales channels at the Global AirRail Awards in November 2019 in Vienna, Austria.

YTLPS

YTLPS is the O&M provider for the Group’s power stations, owned by YTLPG. YTLPG’s 21-year power purchase agreement for the power stations was completed in September 2015 and YTLPG was subsequently awarded the project for the supply of power from Paka Power Station under a short term capacity bid called by the Malaysian Energy Commission. In May 2017, YTLPG and Tenaga Nasional Berhad entered into a new power purchase agreement for the supply of 585 MW of capacity from Paka Power Station for a term of 3 years 10 months and supply commenced on 1 September 2017.

31 YTL CORPORATION BERHAD

Management Discussion & Analysis SEGMENTAL REVIEW

ElectraNet • Installing four large synchronous condensers to raise the existing cap on non-synchronous generation and ensure ongoing system ElectraNet owns and operates the high voltage electricity security with adequate levels of system strength, system inertia transmission system throughout South Australia under a 200-year and voltage control for South Australia’s electricity transmission concession, transmitting power from regional generators and system. The synchronous condensers will be installed during interstate sources over long distances to metropolitan and regional 2020 and 2021 and fully commissioned by late 2021. areas including large, direct-connect industrial customers. The transmission network is one of the most extensive regional • Building a new transmission line to improve reliability for transmission systems in Australia and consists of 97 high-voltage customers on the Eyre Peninsula in South Australia’s west substations and approximately 5,650 circuit kilometres of coast. Construction work is expected to start in 2021. transmission lines covering a total area of 200,000 square kilometres.

ElectraNet is also currently undertaking the Prominent Hill/Upper ElectraNet is in the third year of its 2018-2023 regulatory period. North connection project, which is the largest contracted revenue On 30 April 2018, it received approval from the Australian Energy project it has ever undertaken. The project includes the construction Regulator (AER) to recover AUD1.6 billion of revenue on its regulated of approximately 300 kilometres of 132kV and 275kV transmission electricity transmission network over the current 5-year regulatory lines and two substations to connect and supply about 100 MW period. of power to OZ Minerals’ Carrapateena and Prominent mine sites. The Carrapateena mine site was energised in mid-2019 with System security and reliability are critically important as Australia’s Prominent Hill to follow in late 2020. energy supply transitions to a lower carbon emissions future and South Australia is at the forefront of this energy transformation ElectraNet is positioning itself to pursue potential contestable with world-leading levels of intermittent renewable energy compared revenue investment opportunities which may include building, to energy demand. ElectraNet has been exploring options to support owning and operating new electricity transmission infrastructure. this energy transformation, while helping to lower electricity prices and improve system security. Current projects (some of which are Jawa Power still subject to regulatory approval) include: Jawa Power’s 1,220 MW power station supplies power to Indonesia’s • Constructing a new, high capacity interconnector between national utility company, PT PLN (Persero) (“PLN”), under a 30-year South Australia and New South Wales. The proposed power purchase agreement. O&M for Jawa Power is carried out by 920-kilometre 330kV transmission line will deliver economic PT YTL Jawa Timur, a wholly-owned subsidiary of YTL Power, under benefits to customers by better sharing of energy resources a 30-year agreement. in the National Electricity Market (NEM). The AUD2.4 billion project, Project EnergyConnect, would be jointly delivered with Jawa Power achieved average availability of 84.5% for its financial TransGrid, the owner and operator of the New South Wales year ended 31 December 2019 and 88.8% availability for the six electricity transmission network. months ended 30 June 2020. The station generated 8,029 GWh of electricity for its financial year compared to 8,748 GWh for its previous financial year, for its sole offtaker, PLN.

32 ANNUAL REPORT 2020

Management Discussion & Analysis

IT & E-COMMERCE RELATED BUSINESS

SEGMENT OVERVIEW

The YTL Corp Group’s IT & e-Commerce Related Business activities are undertaken by its wholly- owned subsidiary, YTL e-Solutions Berhad, and its subsidiaries (“YTL e-Solutions Group”). The YTL e-Solutions Group undertakes technology incubation investments, as well as the provision of IT consultancy services and digital media content. The YTL e-Solutions Group also owns a controlling interest in Y-Max Networks Sdn Bhd which was granted one of four Worldwide Interoperability for Microwave Access (WiMAX) licenses in Malaysia.

OPERATIONAL REVIEW

For the financial year under review, the division continued to develop its core content and digital media business by improving its integrated Out of Home (“OOH”) digital network to attract advertisers in this highly competitive area. The division also provides OOH digital media solutions and targets renowned brand names to fulfil their outdoor marketing needs.

The division progressed well with its ongoing efforts to improve its proprietary content management solutions and content production, delivering advertising on its digital narrowcast media networks in Bintang Walk and the iconic LED cube, “The Cube”@ Bukit Bintang. Services are also provided via digital networks in other retail and commercial areas such as Lot 10 Shopping Centre and on the Kuala Lumpur Express Rail Link (KLIA Ekspres and KLIA Transit) trains which service the Kuala Lumpur International Airport (KLIA) and the KLIA2 low-cost carrier terminal.

33 YTL CORPORATION BERHAD

Management Discussion & Analysis

RISK MANAGEMENT

The overall risk management objective of the YTL Corp Group is OPERATING RISK MANAGEMENT to ensure that adequate resources are available to create value Concessions and key contracts for its shareholders. Risk management is carried out through regular risk review analysis, internal control systems and adherence to A number of the YTL Corp Group’s businesses and projects are Group’s risk management policies. The Board of Directors of YTL reliant, in some cases to a significant extent, on concessions or Corp regularly reviews these risks and approves the appropriate other key contracts. Cancellation, expiration, termination or control environment frameworks. renegotiation of any such concession or key contract or the imposition of restrictive regulatory controls could have a material adverse effect on the financial condition and results of operations FINANCIAL RISK MANAGEMENT of certain subsidiaries of YTL Corp and accordingly the YTL Corp Group as a whole. The Group’s operations are subject to foreign currency exchange risk, interest rate risk, price risk, credit risk and liquidity risk. The However, the Group’s strategy of investing in regulated assets Group focuses on the unpredictability of financial markets and with long-term concessions or contracts has enabled it to establish seeks to minimise potential adverse effects on its financial a solid track record and operating performance to date, and is a performance. Further details on the Group’s financial risk management measure to mitigate the vagaries of short-term contracts or more can be found in Note 38 of the Notes to the Financial Statements cyclical industries. Furthermore, the Group addresses these risks in this Annual Report. by investing in assets operating in stable economies and/or established markets or sectors with strong legal protections.

34 ANNUAL REPORT 2020

Management Discussion & Analysis RISK MANAGEMENT

Business risk Dependence on key management

The YTL Corp Group’s principal activities are subject to certain risks The continued success of YTL Corp is, to a significant extent, inherent in their respective sectors. These may include shortages dependent on the abilities and continued efforts of the Board and of labour and raw materials, increases in the cost of labour, raw senior management of YTL Corp. The loss of any key member of materials, equipment and electricity tariffs, changes in the general the Board or senior management personnel could affect YTL Corp’s economic, business, credit and interest rate conditions, inflation, ability to compete in the sectors in which it operates. The future taxation and changes in the legal and environmental framework success of YTL Corp will also depend on its ability to attract and within which the industries operate. retain skilled personnel for smooth business operations of the Group to continue without undue disruption. Whilst it is not possible to prevent the occurrence of these events, the Group addresses these matters by maintaining sound financial Therefore, appropriate measures are taken which include the risk management policies as set out above, and high standards of provision of training programmes, the offering of attractive incentives preventive maintenance and cost efficiency coupled with technical such as employees’ share option schemes and competitive and operating efficiency of its assets. remuneration packages, and efforts to ensure smooth succession in the management team.

Political, economic, environmental and regulatory considerations

Like all other businesses, adverse developments in political, economic and regulatory conditions (including changes in environmental legislation and regulations) in Malaysia, Singapore, the UK, Indonesia, China, Australia, Japan, Jordan and other overseas markets in which the YTL Corp Group from time to time has operations could materially and adversely affect the financial and business prospects of the YTL Corp Group and the markets for its products and/or services which may result in a loss or reduction in revenue to Group.

Whilst it is not possible to prevent the occurrence of these events, the Group attempts to mitigate the effects of these risks through thorough due diligence assessments prior to the commitment to any project, ensuring compliance with applicable laws and regulations, as well as its strategy of maintaining the geographic diversity of its operations, and remaining vigilant in monitoring events and conducting ongoing assessments of any operational and financial impacts of such external developments.

35 YTL CORPORATION BERHAD

Management Discussion & Analysis

OUTLOOK

Global growth is expected to weaken in 2020, in light of the ongoing COVID-19 pandemic which has significantly dampened global growth prospects, with the outlook highly dependent on how successful countries across the world are in containing the pandemic. The Malaysian economy is projected to register between -2.0% and 0.5% growth for the full 2020 calendar year, impacted by the output loss, the effects of the MCO and commodities supply disruptions as a result of the pandemic (source: Bank Negara Malaysia updates).

In the Utilities division, whilst electricity demand in Singapore has yet to recover to post-pandemic levels, fiscal stimulus packages launched by the Singapore government bode well for the recovery In the Cement Manufacturing & Trading segment, whilst the short- process. Despite the challenges presented by the persistent term outlook hinges on the impact of the pandemic on public and generation oversupply situation in Singapore’s wholesale electricity private plans for new investments, the solid dynamics of the Group’s market, the Group has embarked on the proposed acquisition of main markets remain intact. The Group is confident that the key Tuaspring’s power plant and associated assets which, once growth drivers, including infrastructure requirements and demand completed, will be integrated into its existing businesses and for housing from urbanisation, will continue to underpin demand expected to contribute positively to future earnings, in addition growth. The division will also increase export volumes from its to alleviating some capacity issues. dedicated Langkawi production facility.

In the UK, the Group will continue to work towards investment In the Construction segment, operations have recommenced commitments set for the 2020-2025 regulatory period which following the MCO. The industry has adopted the necessary strict commenced on 1 April 2020. Whilst this next period will see a shift standard operating procedures, which have disrupted operational from current performance levels, the Group remains committed to efficiency, resulting in sub-optimal utilisation of assets and the delivering high quality, reliable and resilient services that are dislocation of resources. Nevertheless, the Group has proactively affordable to all customers, and is confident it will continue to managed these new operating conditions to mitigate delays and deliver outperformance of its regulatory targets. improve cost and operational efficiencies, and will continue to step up these efforts. The outlook for the Group’s main operations in Malaysia remains stable. The supply of capacity from Paka Power Station is regulated The outlook for the property sector and consumer demand for under its PPA until June 2021 and the division is expected to property products remains uncertain due to the ongoing situation. perform well, whilst in the telecommunications sub-segment, with However, the Group will continue to embark on marketing efforts the existing network in place, the Group is well-positioned to grow and initiatives to unlock sales as well as undertake project launches its subscriber base with innovative, competitive and affordable where viable. products and services. Meanwhile, in the hospitality industry, demand from international Work will also continue towards financial close for Tanjung Jati business and leisure travellers is expected to remain subdued until Power, whilst APCO’s oil shale power generation project in Jordan containment of the pandemic, after which pent-up demand is will progress once the current COVID-19 restrictions have been expected to fuel recovery. In the near term, the substitution of resolved. overseas travel with local travel due to international border restrictions has begun to drive demand and the Group is well- positioned to capitalise on this changing landscape.

36 ANNUAL REPORT 2020 Managing Sustainability

Integrating sustainability into business continuity planning is one of the fundamental principles in creating long-term value for stakeholders through sustainable and responsible business practices. We recognise the importance of conducting business responsibly with due consideration given not only to our Group’s financial performance but also the economic, environmental and social (EES) aspects of business sustainability, optimising value to shareholders and other stakeholders.

Our sustainability strategy remains focused on the four pillars as outlined in our sustainability framework. There was a change to the selection of our core 17 United Nations Sustainable Development Goals (SDGs) and the addition of peripheral SDGs. This year, we made adjustments to align with our Group-wide initiatives to the SDGs, to eliminate any overlap.

YTL Group Sustainability Framework

Brand Values MORAL Building the HONESTY HARD WORK TOGETHERNESS VITALITY RESPONSIBILITY right thing

Sustainability Commitment Making a good future happen PROTECTION OF THE EMPOWERING ENRICHING EMBRACING THE ENVIRONMENT OUR PEOPLE COMMUNITIES MARKETPLACE

Aligned to Sustainable Development Goals

Core

Peripheral

37 YTL CORPORATION BERHAD

Managing Sustainability

MATERIALITY YTL Group Materiality Matrix In identifying our material issues, we are able to prioritise which issues to improve on and optimise our sustainability management. Through various engagement channels, we seek to understand the High views of the stakeholders, to communicate effectively with them and to respond to their concerns. Stakeholders are groups, individuals, organisations and resources that may be significantly impacted by the Group’s businesses and those with a vested interest in our operations. As a publicly listed entity, YTL Corporation Berhad’s 1 (“YTL Corp”) key stakeholders are our employees, customers, suppliers, 33 2 shareholders, and other investors, regulators, the environment and 8 4 the communities where we operate. 10 6 5 12 99 11 77 1313 1414 15 To ensure the continued relevance of our material issues, we conduct 1818 17 1616 19 a formal materiality assessment biennially. Following our last review 19 20 YTL Group’s Ability to Impact YTL Group’s 22 21 in 2017, we conducted a new materiality review this year. The 23 sustainability team works with the relevant business units to identify and review material issues that are most relevant and significant 2424 to our stakeholders. Priorities are ranked based on the actual and potential impacts of issues affecting business continuity and Low Importance to YTL Group High development. The final list of material issues was reviewed and approved by the Board. Based on the assessment, the materiality matrix generated a total of 24 material sustainability matters, of Highly Material Material which eleven were ranked as highly material. 1 Ethical business and compliance 12 Employee benefits

2 Anti-bribery and corruption 13 Employee engagement We are proud that in 2020 YTL Corp was named as one of the 3 Governance and transparency 14 Sustainable supply chain constituents of the FTSE4Good Bursa Malaysia Index for the fourth consecutive year. Information on YTL Group’s governance structure, 4 Financial sustainability 15 Training and education sustainability related material issues, initiatives, performance and 5 Risk management 16 Climate and energy achievements during the financial year ending 30 June 2020 can 6 Customer privacy 17 Education be found in our 14th standalone YTL Group Sustainability 7 Customer satisfaction 18 Waste management Report 2020 which is available for download at www.ytl.com/ sustainability. The report focuses on YTL Group’s key businesses 8 Product and services 19 Air emissions in Malaysia and globally. 9 Scheduled waste disposal 20 Local community

10 Health and safety 21 Innovation and technology

11 Diversity and anti-discrimination 22 Biodiversity

23 Water efficiency

24 Arts and culture

38 ANNUAL REPORT 2020

Corporate Events

13 OCTOBER 2019 Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping Conferred Knight Commander of The Most Excellent Order of the British Empire by HM Queen Elizabeth II YTL Corporation Berhad’s Executive Chairman, Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, was conferred an honorary Knight Commander of The Most Excellent Order of the British Empire (KBE) by Her Majesty Queen Elizabeth II for contributions to enhancing bilateral relations between Malaysia and the United Kingdom.

The YTL Group’s substantial investments in the United Kingdom include Wessex Water Limited, consistently ranked amongst the country’s top water and sewerage companies, and a portfolio of award-winning luxury hotels. The Group’s newest ventures are YTL Arena and the Brabazon mixed residential and commercial project, being developed in Bristol.

The award was presented to Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping by His Royal Highness Prince Charles at his official residence at Clarence House on 13 October 2019.

18 OCTOBER 2019 3 Orchard By-The-Park Receives Six Awards at EdgeProp Singapore Excellence Awards 2019 3 Orchard By-the-Park, a luxury development by YTL Land & Development Berhad, a subsidiary of YTL Corporation Berhad, won six awards at The EdgeProp Singapore Excellence Awards 2019, including Design Excellence (Developer & Architect), People’s Choice, Top Development, Top Luxury Development and Top Boutique Development.

From left to right: Ms Cheang Mei Ling of DP Architects, and, representing YTL Land & Development Berhad, Ms Jasmine Gwee, Mr Joseph Yeoh Keong Shyann, Ms Yeoh Pei Teeng, Ms Magdeline Loke, Mr Lee Wui Nghun and Mr Richard Leen

4 NOVEMBER 2019 Express Rail Link wins Partnership of the Year Award Express Rail Link Sdn Bhd, a 45% associate of YTL Corporation Berhad, was awarded the Partnership of the Year Award at the annual Global Air Rail Awards held in Vienna, in recognition of its efforts in expanding its sales platform and customer base worldwide.

Puan Noormah Mohd Noor, Chief Executive Officer of Express Rail Link Sdn Bhd, and Mr Thomas Baake, Chief Executive Officer of ERL Maintenance Support Sdn Bhd

39 YTL CORPORATION BERHAD

Corporate Events

19 NOVEMBER 2019 4 DECEMBER 2019 Attarat Power Company Receives Power Project of the YTL Communications Sdn Bhd Wins Connectivity – Year Award 2019 Telecommunications Award Attarat Power Company PSC (APCO), which is 45%-owned by YTL Communications Sdn Bhd, a subsidiary of YTL Corporation YTL Power International Berhad, a listed subsidiary of YTL Berhad, won the Connectivity – Telecommunications award at Corporation Berhad, won the Power Project of the Year Award the Malaysia Technology Excellence Awards for its Terragraph 2019 from the Petroleum Economist at its annual awards dinner deployment in George Town, a gigabit wireless mesh network event organised by Petroleum Economist Magazine in London. powering free public Wi-Fi hotspots and delivering wireless broadband service to 120 businesses and government offices in less than 3 months.

Mr Jason Pok (second from left), Chief Executive Officer and Director of From left to right:- Representing YTL Communications Sdn Bhd, Mr Tang APCO, and Mr Mohammad Maaitah (third from left), Director of APCO, Mun Keong, Head of Core Network & Transport Engineering Department; alongside the presenters of the awards Mr Jacob Yeoh Keong Yeow, Deputy Chief Executive Officer; Mr Wing K Lee, Chief Executive Officer; Mr Rahul Shrivastav, Lead Solution Architect; and Mr Avinash Pathak, Project Manager

24 MARCH 2020 YTL Foundation Donates RM1 Million to Tabung COVID-19 YTL Foundation, represented by Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, Executive Chairman of YTL Corporation Berhad and member of the Board of Trustees of YTL Foundation, presented a donation of RM1 million to Malaysia’s Prime Minister, YAB Tan Sri Dato’ Haji Muhyiddin Bin Haji Mohd Yassin, at Perdana Putra. The COVID-19 fund was launched by the Government on 11 March 2020 to help those affected by the pandemic.

40 ANNUAL REPORT 2020

Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN THAT the Thirty-Seventh Annual General Meeting of YTL Corporation Berhad (“the Company”) will be held on Tuesday, the 1st day of December, 2020 at 1.30 p.m. and will be conducted as a fully virtual meeting through live streaming from the broadcast venue at the Town Hall, 8th Floor, Menara YTL, 205 Jalan Bukit Bintang, 55100 Kuala Lumpur, Wilayah Persekutuan, Malaysia to transact the following business:-

AS ORDINARY BUSINESS

1. To lay before the meeting the Audited Financial Statements for the financial year ended 30 June 2020 Please refer together with the Reports of the Directors and Auditors thereon. Explanatory Note A

2. To re-elect the following Directors who retire pursuant to Article 86 of the Company’s Constitution:-

(i) Dato’ Yeoh Seok Kian Resolution 1

(ii) Dato’ Yeoh Soo Min Resolution 2

(iii) Dato’ Yeoh Seok Hong Resolution 3

(iv) Dato’ Cheong Keap Tai Resolution 4

3. To approve the payment of fees to the Non-Executive Directors amounting to RM821,751 for the financial year ended 30 June 2020. Resolution 5

4. To approve the payment of meeting attendance allowance of RM1,000 per meeting for each Non- Executive Director for the period from January 2021 to December 2021. Resolution 6

5. To re-appoint HLB Ler Lum PLT as Auditors of the Company and to authorise the Directors to fix their remuneration. Resolution 7

AS SPECIAL BUSINESS

To consider and, if thought fit, pass the following resolutions:-

ORDINARY RESOLUTIONS:-

6. CONTINUING IN OFFICE AS INDEPENDENT NON-EXECUTIVE DIRECTOR

“THAT subject to the passing of the Ordinary Resolution 4, approval be and is hereby given to Dato’ Cheong Keap Tai, who has served as Independent Non-Executive Director of the Company for a cumulative term of more than twelve years, to continue to serve as an Independent Non- Executive Director of the Company.” Resolution 8

7. PROPOSED AUTHORITY TO ALLOT SHARES PURSUANT TO SECTIONS 75 AND 76 OF THE COMPANIES ACT, 2016

“THAT pursuant to Sections 75 and 76 of the Companies Act, 2016, the Directors be and are hereby empowered 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 twenty per centum (20%) of the total number of issued shares of the Company for the time being and that the Directors be and are also empowered to obtain the approval for the listing of and quotation for the additional shares so issued on Bursa Malaysia Securities Berhad.” Resolution 9

41 YTL CORPORATION BERHAD

Notice of Annual General Meeting

8. PROPOSED RENEWAL OF SHARE BUY-BACK AUTHORITY

“THAT subject to the Company’s compliance with all applicable rules, regulations, orders and guidelines made pursuant to the Companies Act, 2016, the provisions of the Company’s Constitution and the Bursa Malaysia Securities Berhad (“Bursa Securities”) Main Market Listing Requirements (“Main LR”) and the approvals of all relevant authorities, the Company be and is hereby authorised, to the fullest extent permitted by law, to buy back and/or hold from time to time and at any time such amount of ordinary shares in the Company as may be determined by the Directors of the Company from time to time through Bursa Securities upon such terms and conditions as the Directors may deem fit and expedient in the interests of the Company (“the Proposed Share Buy-Back”) provided that:-

(i) The maximum number of shares which may be purchased and/or held by the Company at any point of time pursuant to the Proposed Share Buy-Back shall not exceed ten per centum (10%) of the total number of issued shares of the Company for the time being quoted on Bursa Securities provided always that in the event that the Company ceases to hold all or any part of such shares as a result of, amongst others, cancellation of shares, sale of shares on the market of Bursa Securities or distribution of treasury shares to shareholders as dividend in respect of shares bought back under the previous shareholder mandate for share buy-back which was obtained at the Annual General Meeting held on 12 December 2019, the Company shall be entitled to further purchase and/or hold such additional number of shares as shall (in aggregate with the shares then still held by the Company) not exceed ten per centum (10%) of the total number of issued shares of the Company for the time being quoted on Bursa Securities;

(ii) The maximum amount of funds to be allocated by the Company pursuant to the Proposed Share Buy-Back shall not exceed the retained profits of the Company at the time of purchase by the Company of its own shares; and

(iii) The shares purchased by the Company pursuant to the Proposed Share Buy-Back may be dealt with by the Directors in all or any of the following manner:-

(a) the shares so purchased may be cancelled; and/or

(b) the shares so purchased may be retained in treasury for distribution as dividend to the shareholders and/or resold on the market of Bursa Securities and/or subsequently cancelled; and/or

(c) part of the shares so purchased may be retained as treasury shares with the remainder being cancelled; and/or

(d) transfer the shares, or any of the shares for the purposes of or under an employees’ shares scheme; and/or

(e) transfer the shares, or any of the shares as purchase consideration; and/or

(f) deal with the shares in any other manner as may be permitted by the applicable laws and/ or regulations in force from time to time;

AND THAT such authority shall commence upon the passing of this resolution, until the conclusion of the next Annual General Meeting of the Company or the expiry of the period within which the next Annual General Meeting is required by law to be held unless revoked or varied by Ordinary Resolution of the shareholders of the Company in general meeting, whichever occurs first, but so as not to prejudice the completion of a purchase made before such expiry date;

42 ANNUAL REPORT 2020

Notice of Annual General Meeting

AND THAT the Directors of the Company be and are hereby authorised to take all steps as are necessary or expedient to implement or to give effect to the Proposed Share Buy-Back with full powers to amend and/or assent to any conditions, modifications, variations or amendments (if any) as may be imposed by the relevant governmental/regulatory authorities from time to time and with full power to do all such acts and things thereafter in accordance with the Companies Act, 2016, the provisions of the Company’s Constitution and the Main LR and all other relevant governmental/regulatory authorities.” Resolution 10

By Order of the Board,

HO SAY KENG Company Secretary

KUALA LUMPUR 30 October 2020

Notes:- (i) In hardcopy form [applicable for all members] REMOTE PARTICIPATION AND VOTING The original Form of Proxy and the power of attorney or other authority, if any, under which it is signed or a notarially certified or office copy 1. The Annual General Meeting (“AGM”) will be conducted on a virtual basis of that power or authority shall be deposited at the office of Tricor at through live streaming and online remote voting using the Remote Participation Unit 32-01, Level 32, Tower A, Vertical Business Suite, Avenue 3, Bangsar and Voting (“RPV”) facilities provided by the appointed share registrar and South, No. 8, Jalan Kerinchi, 59200 Kuala Lumpur, Malaysia, poll administrator for the AGM, Tricor Investor & Issuing House Services Sdn Bhd (“Tricor”) on its TIIH Online website at https://tiih.online. Please follow or alternatively, the procedures set out in the Administrative Guide for the AGM which is at its Customer Service Centre at Unit G-3, Ground Floor, Vertical Podium, available on the Company’s website at http://ytl.com/meetings to register, Avenue 3, Bangsar South, No. 8, Jalan Kerinchi, 59200 Kuala Lumpur, participate, speak (in the form of real time submission of typed texts) and Malaysia. vote remotely via the RPV facilities. (ii) By Tricor Online System (TIIH Online) [applicable only for members BROADCAST VENUE who are individuals] 2. The Broadcast Venue of the AGM is strictly for the purpose of complying The Form of Proxy can be electronically lodged with Tricor via TIIH with Section 327(2) of the Companies Act, 2016 which requires the Chairperson Online at https://tiih.online. Please follow the procedures set out in the of the meeting to be at the main venue of the meeting. Members/proxies/ Administrative Guide. representatives are not allowed to be physically present at the Broadcast 8. For the purpose of determining a member who shall be entitled to attend Venue on the day of the AGM. the AGM via the RPV facilities, the Company shall be requesting Bursa Malaysia Depository Sdn Bhd, in accordance with Article 59 of the Company’s Constitution PROXY and Section 34(1) of the SICDA to issue a General Meeting Record of Depositors 3. A member (including an Authorised Nominee as defined under the Securities as at 23 November 2020. Only a depositor whose name appears on the Industry (Central Depositories) Act, 1991 (“SICDA”)) entitled to attend and vote General Meeting Record of Depositors as at 23 November 2020 shall be at a general meeting of the Company may appoint not more than two (2) entitled to attend the said meeting or appoint proxy(ies) to attend and/or proxies to participate instead of the member at the AGM via the RPV facilities. vote in his stead. 4. Where a member is an Exempt Authorised Nominee as defined under the REPRESENTATIVE FROM CORPORATE MEMBER SICDA, which holds ordinary shares in the Company for multiple beneficial owners in one securities account (“Omnibus Account”), there is no limit to 9. For a corporate member who has appointed an authorised representative, the number of proxies which the Exempt Authorised Nominee may appoint please deposit the original certificate of appointment of corporate representative in respect of each Omnibus Account it holds. with Tricor at Unit 32-01, Level 32, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No. 8, Jalan Kerinchi, 59200 Kuala Lumpur, Malaysia, 5. A proxy may but need not be a member of the Company. Where a member appoints more than one (1) proxy, the appointment shall be invalid unless he or alternatively, specifies the proportion of his shareholdings to be represented by each proxy. at its Customer Service Centre at Unit G-3, Ground Floor, Vertical Podium, 6. The instrument appointing a proxy shall be in writing under the hand of the Avenue 3, Bangsar South, No. 8, Jalan Kerinchi, 59200 Kuala Lumpur, Malaysia, appointor or his attorney duly authorised in writing or, if the appointor is a not less than 48 hours before the time appointed for holding the AGM or corporation, either under its seal or under the hand of an officer or attorney adjourned meeting at which the person named in the appointment proposes duly authorised in writing. to vote. 7. The appointment of proxy may be made in hardcopy form or by electronic means as specified below and must be received by Tricor not less than 48 hours before the time appointed for holding the AGM i.e. no later than 29 November 2020 at 1:30 p.m.:

43 YTL CORPORATION BERHAD

Notice of Annual General Meeting

Explanatory Notes to Ordinary Business As at the date of this Notice, the Company has issued 5,988,377 new shares (“New Shares”) pursuant to the Previous Mandate. The New Shares were issued Note A pursuant to the share exchange offer to acquire all the remaining securities in This Agenda item is meant for discussion only as under the provisions of Section YTL Land & Development Berhad not already held by the Company. There were 340(1)(a) of the Companies Act, 2016, the audited financial statements do not no proceeds raised from the issuance of the New Shares. require formal approval of shareholders and hence, the matter will not be put forward for voting. Resolution 9, if passed, will give the Directors authority to allot and issue ordinary shares at any time up to a maximum of 20% of the total number of issued share Payment of Directors’ Benefits of the Company (“20% General Mandate”) for such purposes as the Directors In accordance with the requirements of Section 230(1) of the Companies Act, consider expedient and in the best interest of the Company. This authority will 2016, approval of the members is sought for the payment of meeting attendance expire at the next AGM of the Company unless revoked or varied by the Company allowance (a benefit) to the Non-Executive Directors of the Company. If Resolution at a general meeting. 6 is passed, the meeting attendance allowance will be payable for such period at the quantum specified. The 20% limit is the increased limit (from the 10% limit prescribed in the Listing Requirements) accorded to listed issuers by Bursa Malaysia Securities Berhad Explanatory Notes to Special Business vide its letter dated 16 April 2020 as part of its interim relief measures to help listed issuers raise funds quickly and efficiently during this challenging time as Resolutions on the Continuing in Office as Independent Non-Executive a result of the pandemic. Director In line with Practice 4.2 of the Malaysian Code on Corporate Governance, Resolution The Board of Directors of the Company is of the view that the 20% General 8 is to enable Dato’ Cheong Keap Tai to continue serving as Independent Director Mandate will provide the Company the flexibility to raise capital in a fast and of the Company to fulfil the requirements of Paragraph 3.04 of the Bursa Malaysia timely manner for funding future investment project(s), working capital and/or Securities Berhad Main Market Listing Requirements. The justifications of the acquisitions or strategic opportunities involving equity deals such as but not Board of Directors for recommending and supporting the resolution for his limited to placement of shares. The cost and delay involved in convening a general continuing in office as Independent Director is set out under the Nominating meeting to approve such issuance of shares will be eliminated. As such, the Committee Statement in the Company’s Annual Report 2020. The shareholders’ Board of Directors considers the 20% General Mandate proposal to be in the approval for Resolution 8 will be sought on a single-tier voting process. best interest of the Company and its shareholders.

Resolution pertaining to the Renewal of Authority to Buy Back Shares Resolution pursuant to Sections 75 and 76 of the Companies Act, 2016 of the Company Resolution 9 is a renewal of the general authority given to the Directors of the For Resolution 10, further information on the Share Buy-Back is set out in the Company to allot and issue shares as approved by the shareholders at the Thirty- Statement to Shareholders dated 30 October 2020 which is dispatched together Sixth Annual General Meeting held on 12 December 2019 (“Previous Mandate”). with the Company’s Annual Report 2020.

Statement Accompanying Notice of Annual General Meeting (Pursuant to Paragraph 8.27(2) of Bursa Malaysia Securities Berhad Main Market Listing Requirements)

1. DETAILS OF INDIVIDUALS WHO ARE STANDING FOR ELECTION AS DIRECTORS (EXCLUDING DIRECTORS STANDING FOR RE-ELECTION)

No individual is seeking election as a Director at the Thirty-Seventh Annual General Meeting of the Company.

2. GENERAL MANDATE FOR ISSUE OF SECURITIES IN ACCORDANCE WITH PARAGRAPH 6.03(3) OF BURSA MALAYSIA SECURITIES BERHAD MAIN MARKET LISTING REQUIREMENTS

Details of the general mandate/authority for Directors to allot and issue shares in the Company pursuant to Sections 75 and 76 of the Companies Act, 2016 are set out in the Explanatory Notes to Special Business of the Notice of Thirty-Seventh Annual General Meeting.

44 ANNUAL REPORT 2020

Corporate Information

BOARD OF DIRECTORS REGISTERED OFFICE REMUNERATION COMMITTEE Executive Chairman 33rd Floor, Menara YTL Faiz Bin Ishak Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping 205 Jalan Bukit Bintang (Chairman and Independent Non-Executive PSM, KBE, CBE, FICE, SIMP, DPMS, DPMP, JMN, JP 55100 Kuala Lumpur Director) Hon LLD (Nottingham), Hon DEng (Kingston), Tel : 603 2038 0888 Dato’ Cheong Keap Tai BSc (Hons) Civil Engineering, FFB, F Inst D, Fax : 603 2038 0388 (Independent Non-Executive Director) MBIM, RIM BUSINESS OFFICE Raja Noorma Binti Raja Othman Managing Director (Independent Non-Executive Director) Dato’ Yeoh Seok Kian 33rd Floor, Menara YTL 205 Jalan Bukit Bintang DSSA AUDITORS BSc (Hons) Bldg, MCIOB, FFB 55100 Kuala Lumpur Tel : 603 2038 0888 HLB Ler Lum PLT Directors Fax : 603 2038 0388 (LLP0021174–LCA & AF 0276) Dato’ Cheong Keap Tai Chartered Accountants REGISTRAR (A member of HLB International) Dato’ Yeoh Soo Min DSPN, DPMP, DIMP 33rd Floor, Menara YTL BA (Hons) Accounting 205 Jalan Bukit Bintang STOCK EXCHANGE LISTING 55100 Kuala Lumpur Bursa Malaysia Securities Berhad Dato’ Yeoh Seok Hong Tel : 603 2038 0888 Main Market (3.4.1985) DSPN, JP Fax : 603 2038 0388 BEng (Hons) Civil & Structural Engineering, FFB Tokyo Stock Exchange Dato’ Sri Michael Yeoh Sock Siong AUDIT COMMITTEE Foreign Section (29.2.1996) DIMP, SSAP Dato’ Cheong Keap Tai BEng (Hons) Civil & Structural Engineering, FFB (Chairman, Independent Non-Executive Dato’ Yeoh Soo Keng Director) DIMP Dato’ Ahmad Fuaad Bin Mohd BSc (Hons) Civil Engineering Dahalan Dato’ Mark Yeoh Seok Kah (Independent Non-Executive Director) DSSA Faiz Bin Ishak LLB (Hons) (Independent Non-Executive Director) Dato’ Ahmad Fuaad Bin Mohd Dahalan ABS, DIMP, SIMP NOMINATING COMMITTEE BA (Hons) Faiz Bin Ishak Syed Abdullah Bin Syed Abd. Kadir (Chairman and Independent Non-Executive BSc (Engineering Production), BCom Director) (Economics) Dato’ Cheong Keap Tai Faiz Bin Ishak (Independent Non-Executive Director) Fellow of the Association of Chartered Certified Accountants Raja Noorma Binti Raja Othman (Independent Non-Executive Director) Raja Noorma Binti Raja Othman BBA (Deans List)

COMPANY SECRETARY Ho Say Keng

45 YTL CORPORATION BERHAD

Profile of the Board of Directors

TAN SRI DATO’ (DR) FRANCIS YEOH SOCK PING

Malaysian, male, aged 66, was appointed to the Board on 6 April the International Friends of the Louvre. He is also a member of 1984 as an Executive Director and has been the Managing Director the Advisory Council of London Business School, Wharton School of the Company since April 1988 till 29 June 2018 when he was and INSEAD. He is the first non-Italian board member of the historic redesignated as Executive Chairman. Tan Sri Francis studied at Rome Opera House and helped fund its restoration to keep it from Kingston University in the United Kingdom, where he obtained a closing. He served as a member of the Barclays Asia-Pacific Advisory Bachelor of Science (Hons) Degree in Civil Engineering and was Committee from 2005 to 2012. Tan Sri Francis was made a board conferred an Honorary Doctorate of Engineering in 2004. In July member of Global Child Forum by His Majesty King Carl XVI Gustaf 2014, Tan Sri Francis was conferred an Honorary Degree of Doctor in May 2016. of Laws from University of Nottingham. He became the Managing Director of YTL Corporation Berhad Group in 1988 which, under He was ranked by both Fortune and Businessweek magazines as his stewardship, has grown from a single listed company into a Asia’s 25 Most Powerful and Influential Business Personalities and global integrated infrastructure developer, encompassing multiple one of Asia’s Top Executives by Asiamoney. He won the inaugural listed entities ie. YTL Corporation Berhad, YTL Power International Ernst & Young’s Master Entrepreneur in Malaysia in 2002 and was Berhad, YTL Hospitality REIT, Malayan Cement Berhad and Starhill named as Malaysia’s CEO of the Year by CNBC Asia Pacific in 2005. Global Real Estate Investment Trust. In 2006, he was awarded the Commander of the Most Excellent He was the Managing Director of YTL Power International Berhad, Order of the British Empire (CBE) by Her Majesty Queen Elizabeth and YTL Land & Development Berhad until 29 June 2018 when he II, and in 2019, received the Knight Commander of the Order of was redesignated as Executive Chairman of these companies. He the British Empire (KBE). Tan Sri Francis received a prestigious is also the Executive Chairman of Malayan Cement Berhad, which professional accolade when made a Fellow of the Institute of Civil is listed on the Main Market of Bursa Malaysia Securities Berhad. Engineers in London in 2008. He was the Primus Inter Pares He is the Executive Chairman and Managing Director of YTL Honouree of the 2010 Oslo Business for Peace Award, for his e-Solutions Berhad. He is also the Chairman of YTL Starhill Global advocacy of socially responsible business ethics and practices. The REIT Management Limited, the manager of Starhill Global Real Award was conferred by a panel of Nobel Laureates in Oslo, home Estate Investment Trust, a vehicle listed on the Main Board of the of the Nobel Peace Prize. He also received the Corporate Social Singapore Exchange Securities Trading Limited (SGX-ST). Tan Sri Responsibility Award at CNBC’s 9th Asia Business Leaders Awards Francis is the Executive Chairman of YTL Cement Berhad and Pintar 2010. He received the Lifetime Achievement Award for Leadership Projek Sdn Bhd, the manager of YTL Hospitality REIT. He is the in Regulated Industries at the 7th World Chinese Economic Summit Chairman of private utilities corporations, Wessex Water Services held in London in 2015. He was also awarded the prestigious Limited in England and Wales, and YTL PowerSeraya Pte Limited Muhammad Ali Celebrity Fight Night Award at the 2016 Celebrity in Singapore. Tan Sri Francis is also an Independent Non-Executive Fight Night in Arizona. In 2017, he was honoured with the Kuala Director of The Hong Kong and Shanghai Banking Corporation Lumpur Mayor’s Award for Outstanding Contribution at the Kuala Limited, and is a director of YTL Industries Berhad. He also sits on Lumpur Mayor Tourism Awards. This was in recognition of his the board of trustees of YTL Foundation. He also serves on the efforts in the transformation of Kuala Lumpur into one of the top board of directors of Suu Foundation, a humanitarian organisation shopping and tourist destinations in the world. He was named CEO committed to improving healthcare and education in Myanmar. of the Year at the Asian Power Awards in 2017. The Japanese Government bestowed upon him the Order of the Rising Sun, Gold He is a Founder Member of the Malaysian Business Council and Rays with Rosette, in 2018 and in the same year the Italian The Capital Markets Advisory Council, member of The Nature government conferred upon him the honour of Grande Officiale of Conservancy Asia Pacific Council, and the Asia Business Council, the Order of the Star of Italy. Trustee of the Asia Society and Chairman for South East Asia of

46 ANNUAL REPORT 2020

Profile of the Board of Directors

DATO’ YEOH SEOK KIAN

Malaysian, male, aged 63, was appointed to the Board on 24 June 29 June 2018 when he was redesignated as Managing Director of 1984 as an Executive Director. He has been the Deputy Managing YTL Land & Development Berhad and Executive Director of YTL Director of the Company till 29 June 2018 when he was redesignated Power International Berhad. He is also an Executive Director of as Managing Director of the Company. He graduated from Heriot- Malayan Cement Berhad, which is listed on the Main Market of Watt University, Edinburgh, United Kingdom in 1981 with a Bachelor Bursa Malaysia Securities Berhad. He is also an Executive Director of Science (Hons) Degree in Building and was conferred an Honorary of Pintar Projek Sdn Bhd, the manager of YTL Hospitality REIT. Degree of Doctor of the University in 2017. He attended the Dato’ Yeoh Seok Kian also sits on the boards of other public Advance Management Programme conducted by Wharton Business companies such as YTL Cement Berhad, YTL Industries Berhad and School, University of Pennsylvania in 1984. Dato’ Yeoh is a Fellow The Kuala Lumpur Performing Arts Centre, and private utilities of the Faculty of Building, United Kingdom as well as a Member corporations, Wessex Water Limited in England and Wales, YTL of the Chartered Institute of Building (UK). He served as Deputy PowerSeraya Pte Limited in Singapore, as well as YTL Starhill Global Managing Director of YTL Power International Berhad, which is REIT Management Limited, the manager of Starhill Global Real listed on the Main Market of Bursa Malaysia Securities Berhad, and Estate Investment Trust, a vehicle listed on the Main Board of the Executive Director of YTL Land & Development Berhad until Singapore Exchange Securities Trading Limited (SGX-ST).

DATO’ CHEONG KEAP TAI

Malaysian, male, aged 72, was appointed to the Board on 30 Dato’ Cheong is also a Licensed Tax Agent and a Licensed Goods September 2004 as an Independent Non-Executive Director. He & Service Tax Agent. Dato’ Cheong was the Executive Director and is also the Chairman of the Audit Committee, a member of the Partner of Coopers & Lybrand and upon its merger with Price Nominating Committee and Remuneration Committee. Dato’ Cheong Waterhouse was the Executive Director, Partner and Chairman of graduated from the University of Singapore with a Bachelor of the Governance Board of PricewaterhouseCoopers until his Accountancy. He is a Chartered Accountant of Malaysian Institute retirement in December 2003. He is currently also a director of of Accountants, a member of the Malaysian Institute of Certified Gromutual Berhad, Tanah Makmur Berhad and several private Public Accountants, member of Malaysian Institute of Taxation and limited companies. member of the Institute of Chartered Secretaries and Administrators.

DATO’ YEOH SOO MIN

Malaysian, female, aged 64, has been appointed to the Board on Advisory Council for Action Learning, Asia School of Business, and 24 June 1984 as an Executive Director. She graduated with a also sits on the board of trustees of Asia School of Business Trust Bachelor of Art (Hons) Degree in Accounting. She did her Articleship Fund. She is currently an Honorary Fellow of the Governors of at Leigh Carr and Partners, London and gained vast experience in International Students House, London, and Sir Thomas Pope, Trinity accounting and management. She was responsible for the setting College, University of Oxford, UK, and member of the Vice- up of the Travel and Accounting Division of the YTL Group in Chancellor’s Circle of University of Oxford, UK. She is also a Trustee December 1990. Dato’ Yeoh Soo Min is currently responsible for of Yayasan Tuanku Fauziah, IJN Foundation and Women’s Leadership the accounting and finance systems for the YTL Group. She is a Centre, University Kebangsaan Malaysia. She also holds directorships member of The Court Of Emeritus Fellows of the Malaysian Institute in YTL Power International Berhad, a company listed on the Main of Management and Life Member of the Women’s Institute of Market of Bursa Malaysia Securities Berhad and YTL Industries Management, Malaysia. Dato’ Yeoh Soo Min is a member of the Berhad. She also sits on the board of trustees of YTL Foundation.

47 YTL CORPORATION BERHAD

Profile of the Board of Directors

DATO’ YEOH SEOK HONG

Malaysian, male, aged 61, was appointed to the Board on 19 June stations owned by YTL Power Generation Sdn Bhd. His other 1985 as an Executive Director. He serves as Managing Director of achievements include the construction of the Express Rail Link YTL Power International Berhad and Executive Director of Malayan between the Kuala Lumpur International Airport and the Kuala Cement Berhad, both listed on the Main Market of Bursa Malaysia Lumpur Sentral Station. He is also responsible for developing the Securities Berhad. He obtained his Bachelor of Engineering (Hons) power and utility businesses of the YTL Power International Berhad Civil & Structural Engineering Degree from the University of Bradford, Group and the building of the fourth generation (4G) network by United Kingdom in 1982. He is a member of the Faculty of Building, YTL Communications Sdn Bhd, where he serves as the Managing United Kingdom. In 2010, he was conferred an Honorary Doctor Director. Dato’ Yeoh Seok Hong sits on the boards of other public of Science degree by Aston University in the United Kingdom. Dato’ companies such as YTL Cement Berhad, YTL Land & Development Yeoh Seok Hong has vast experience in the construction industry Berhad and YTL Industries Berhad, and private utilities corporations, and serves as the Managing Director of Syarikat Pembenaan Yeoh Wessex Water Limited and Wessex Water Services Limited in Tiong Lay Sdn Bhd, the YTL Group’s flagship construction arm. England and Wales and YTL PowerSeraya Pte Limited in Singapore. He was the project director responsible for the development and He also sits on the board of trustees of YTL Foundation. the construction of the two Independent Power Producer power

DATO’ SRI MICHAEL YEOH SOCK SIONG

Malaysian, male, aged 60, was appointed to the Board on 19 June Cement Berhad and Executive Director of YTL Power International 1985 as an Executive Director. He graduated from University of Berhad, both listed on the Main Market of Bursa Malaysia Securities Bradford, United Kingdom in 1983 with a Bachelor of Engineering Berhad and Managing Director of YTL Cement Berhad. He also sits (Hons) Civil & Structural Engineering Degree. Dato’ Sri Michael Yeoh on the boards of other public companies such as YTL Land & is primarily responsible for the YTL Group Manufacturing Division Development Berhad, YTL e-Solutions Berhad, YTL Industries which activities involve cement manufacturing and other building Berhad, Kedah Cement Holdings Berhad and a private utilities material industries. He serves as Managing Director of Malayan corporation, YTL PowerSeraya Pte Limited in Singapore.

DATO’ YEOH SOO KENG

Malaysian, female, aged 57, was appointed to the Board on 16 May hotels and resorts, and property development divisions of the YTL 1996 as an Executive Director. She graduated with a Bachelor of Group. She is instrumental in the sales and marketing of cement Science (Hons) in Civil Engineering from Leeds University, United and related products for YTL Cement Berhad and Perak-Hanjoong Kingdom in 1985. She started her career as the project director Simen Sdn Bhd. She was the Chairman of Cement and Concrete for the construction of the British High Commissioner’s residence, Association from year 2013 to 2015. She is also a director of YTL Kuala Lumpur; the Design & Build of the National Art Gallery in Power International Berhad and Malayan Cement Berhad, both Kuala Lumpur and the Selangor Medical Centre in Shah Alam. She listed on the Main Market of Bursa Malaysia Securities Berhad, YTL was also in charge of a few turnkey projects such as the construction e-Solutions Berhad, YTL Cement Berhad and Kedah Cement Holdings and completion of Yeoh Tiong Lay Plaza, Pahang Cement plant in Berhad. She is actively engaged in community work and is currently Pahang and Slag Cement plants in Selangor and Johor. She heads President of the Federal Territory Kuala Lumpur Branch of the Girl the sales and marketing of the mobile internet of YTL Communications Guides Association Malaysia, and member of the board of the World Sdn Bhd. She is also the purchasing director responsible for bulk Scout Foundation and YTL Foundation. purchases of building materials and related items for the construction,

48 ANNUAL REPORT 2020

Profile of the Board of Directors

DATO’ MARK YEOH SEOK KAH

Malaysian, male, aged 55, was appointed to the Board on 22 June SA (Australia), Wessex Water Limited (UK), P.T. Jawa Power 1995 as an Executive Director. He graduated from King’s College, (Indonesia) and PowerSeraya Limited (Singapore). He serves as an University of London, with an LLB (Hons) and was subsequently Executive Director of YTL Power International Berhad, which is called to the Bar at Gray’s Inn, London in 1988. He was awarded listed on the Main Market of Bursa Malaysia Securities Berhad. He Fellowship of King’s College London in July 2014. is also an Executive Director and Chief Executive Officer of Pintar Projek Sdn Bhd, the manager of YTL Hospitality REIT. He is also a Dato’ Mark Yeoh joined YTL Group in 1989 and is presently the board member of YTL Land & Development Berhad, YTL Cement Executive Director responsible for the YTL Hotels and Resorts Berhad and private utilities corporations, Wessex Water Limited Division. In addition, he is also part of YTL Power’s Mergers & and Wessex Water Services Limited in England and Wales, and YTL Acquisitions Team and was involved in the acquisition of ElectraNet PowerSeraya Pte Limited in Singapore.

DATO’ AHMAD FUAAD BIN MOHD DAHALAN

Malaysian, male, aged 70, was appointed to the Board on 26 the Managing Director. He was formerly a director of Lembaga November 2015 as an Independent Non-Executive Director. He is Penggalakan Pelanchongan Malaysia, Malaysia Industry-Government also a member of the Audit Committee. Dato’ Ahmad Fuaad holds Group for High Technology and Malaysia Airports Holdings Berhad, a Bachelor of Arts (Hons) degree from the University of Malaya. Tokio Marine Insurances (Malaysia) Berhad, Hong Leong Capital He was attached with Wisma Putra, Ministry of Foreign Affairs as Berhad and YTL e-Solutions Berhad. Currently, Dato’ Ahmad Fuaad Malaysian Civil Service (“MCS”) Officer in April 1973 before joining is a director of Pintar Projek Sdn Bhd, the manager of YTL Hospitality Malaysia Airlines in July 1973. While in Malaysia Airlines, Dato’ REIT. He also sits on the board of trustees of YTL Foundation. Ahmad Fuaad served various posts and his last position was as

SYED ABDULLAH BIN SYED ABD. KADIR

Malaysian, male, aged 66, was appointed to the Board on 20 February 1996, the general manager of Amanah Capital Partners October 1999 as an Executive Director. He graduated from the Berhad (now known as MIDF Amanah Capital Berhad), a company University of Birmingham in 1977 with a Bachelor of Science which has interests in, inter alia, discount, money broking, unit (Engineering Production) and a Bachelor of Commerce (Economics) trusts, finance and fund management operations. He currently also Double Degree. He has extensive experience in banking and financial serves on the boards of YTL Power International Berhad which is services, having been with Bumiputra Merchant Bankers Berhad listed on the Bursa Malaysia Securities Berhad and YTL e-Solutions from 1984 to 1994, holding the position of general manager Berhad. immediately prior to his departure from the bank. Prior to joining YTL Corporation Berhad Group, he was, from November 1994 to

FAIZ BIN ISHAK

Malaysian, male, aged 62, was appointed to the Board on 1 December He served in various posts in The New Straits Times Press (M) 2011 as an Independent Non-Executive Director. He is the Chairman Berhad since 1982 and was appointed as the Managing Director of the Nominating Committee and Remuneration Committee. He in 1999 till 2003. He joined Commerce Assurance Berhad (a licensed is also a member of the Audit Committee. He graduated from the general insurance underwriter, now part of Allianz General Insurance Association of Chartered Certified Accountants (ACCA) in the United Berhad) as Executive Director in 2003 and assumed the role of Kingdom in 1982. He was admitted as associateship and fellowship Chief Executive Officer from 2006 to 2007. Encik Faiz is presently of the association in 1993 and 1998 respectively. a business entreprenuer in retail food and beverage. He also serves on the boards of YTL Power International Berhad and Transocean Holdings Bhd, both listed on the Main Market of Bursa Malaysia Securities Berhad.

49 YTL CORPORATION BERHAD

Profile of the Board of Directors

RAJA NOORMA BINTI RAJA OTHMAN

Malaysian, female, aged 61, was appointed to the Board on Prior to joining CIMB Group, she was the Vice-President of Investment 5 September 2019 as an Independent Non-Executive Director. She Banking at JP Morgan, a position she held for over 5 years. She is also a member of the Nominating Committee and Remuneration was attached to JP Morgan’s offices in Hong Kong, Singapore and Committee. She holds a Bachelor of Business Administration degree Malaysia as both industry and client coverage banker. At JP Morgan, from Ohio University, United States of America under a twinning she originated and executed several transactions involving corporate program with MARA Institute of Technology and was the best advisory, equity and debt capital markets, private equity, cross student in her cohort. She attended the Global Leadership border mergers and acquisitions as well as initial public offerings. Development Program at Harvard Business School in 2008 organised She also served in other financial institutions and corporations by International Centre for Leadership in Finance (ICLIF) Malaysia. including Telekom Malaysia Berhad, where she was a board member She is a member of the Malaysian Institute of Accountants. of several of their overseas ventures. The last position she held at Telekom Malaysia Berhad was as Head of Corporate Finance. Puan Raja Noorma Othman has more than 30 years of experience Puan Raja Noorma Othman also holds directorships in Hong Leong in banking, asset management and the corporate sector. Prior to her Financial Group Berhad, a company listed on the Main Market of retirement in December 2018, she was the Head of London Branch Bursa Malaysia Securities Berhad and Hong Leong Investment Bank of CIMB Bank Berhad (“CIMB London”) from years 2015 to 2018. She Berhad. Effective from February 2020, she is appointed as an was a Director of Group Asset Management (“GAM”) in CIMB Investment Independent Investment Committee Member of Mapletree Australia Bank Berhad (“CIMB IB”) from years 2007 to 2015 overseeing the Commercial Private Trust (MASCOT), a private equity real estate entire Asset Management businesses of CIMB Group. During her term fund which holds a portfolio of commercial office properties in as Head of CIMB London and Director of GAM in CIMB IB, she was Australia. also the Chief Executive Officer of CIMB-Mapletree Management Sdn Bhd, an adviser to a privately held real estate fund.

DETAILS OF ATTENDANCE OF DIRECTORS AT Notes: BOARD MEETINGS 1. Family Relationship with Director and/or Major During the financial year, a total of 5 Board meetings were held Shareholder and the details of attendance are as follows:- Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, Dato’ Yeoh Seok Kian, Dato’ Yeoh Soo Min, Dato’ Yeoh Seok Hong, Dato’ Sri Michael Yeoh Sock Siong, Dato’ Yeoh Soo Keng and Dato’ Mark Attendance Yeoh Seok Kah are siblings. Puan Sri Datin Seri Tan Kai Yong @ Tan Kay Neong who is a deemed major shareholder of the Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping 5 Company, is the mother of Tan Sri Dato’ (Dr) Francis Yeoh Dato’ Yeoh Seok Kian 5 Sock Ping, Dato’ Yeoh Seok Kian, Dato’ Yeoh Soo Min, Dato’ Yeoh Seok Hong, Dato’ Sri Michael Yeoh Sock Siong, Dato’ Dato’ Cheong Keap Tai 5 Yeoh Soo Keng and Dato’ Mark Yeoh Seok Kah. Save as disclosed Dato’ Yeoh Soo Min 5 herein, none of the Directors has any family relationship with any director and/or major shareholder of the Company. Dato’ Yeoh Seok Hong 4 2. Conflict of Interest Dato’ Sri Michael Yeoh Sock Siong 5 None of the Directors has any conflict of interest with the Dato’ Yeoh Soo Keng 5 Company. Dato’ Mark Yeoh Seok Kah 4 3. Conviction of Offences (other than traffic offences) Dato’ Ahmad Fuaad Bin Mohd Dahalan 5 None of the Directors has been convicted of any offences Syed Abdullah Bin Syed Abd. Kadir 5 within the past five (5) years.

Faiz Bin Ishak 5 4. Public Sanction or Penalty imposed Raja Noorma Binti Raja Othman 4 None of the Directors has been imposed with any public (Appointed on 5 September 2019) sanction or penalty by the relevant regulatory bodies during the financial year.

50 ANNUAL REPORT 2020

Profile of Key Senior Management

COLIN FRANK SKELLETT

British, male, aged 75, was appointed to the board of directors of Colin is currently Group Chief Executive of Wessex Water, Chairman Wessex Water Services Limited on 1 September 1988. of The Gainsborough Bath Spa Hotel and Thermae Bath Spa, non- executive Chairman of European Connoisseurs Travel and Chair of Colin is a chartered chemist and engineer by training. He has been Merchants’ Academy secondary school. He recently chaired the Bath working in the water industry for more than 45 years, holding a Abbey Appeal Board and is also the chair of the new YTL Land and number of positions in the management and control of both water Property UK business. supply and sewage treatment. Colin was awarded an OBE for services to business and WaterAid He joined Wessex Water in 1974 and was appointed its Chief in the 2012 Queen’s Birthday Honours and has an Honorary Doctorate Executive in 1988. Colin oversaw the move from the public to the in Engineering from the University of the West of England, awarded private sector and the transformation of Wessex Water into a highly in 2015. He was also awarded an Honorary Doctorate in Engineering rated UK public limited company. from Bristol University in February 2019.

JOHN NG PENG WAH

Singaporean, male, aged 61, was appointed to the board of Director which resulted in the creation of various entities, including YTL and the Chief Executive Officer of YTL PowerSeraya Pte Limited PowerSeraya. He was promoted to Deputy General Manager (“YTL PowerSeraya”) on 15 January 2019. He holds a Bachelor of (Business) in 2001 and Senior Vice President (Retail & Regulation) Mechanical Engineering degree from Nanyang Technological Institute in 2004 before assuming the position of Chief Executive Officer in in Singapore, a Master of Science in Systems Engineering from 2009. He left YTL PowerSeraya in 2013, taking on the role of Chief National University of Singapore and a Master of Science in Material Executive Officer of Singapore LNG Corporation Pte Ltd. Science from Carnegie Mellon University, USA. In January 2019, he re-joined YTL PowerSeraya as the Chief Executive He joined the Public Utilities Board, which was established by the Officer. He is currently the Chairman of the Workplace Safety and Singapore Government to be sole supplier of electricity, gas and Health Council, as well as Vice-President of the Singapore National water in Singapore, as an Engineer in 1985 and transitioned with Employers Federation (SNEF). He also serves as a board member the company following the restructuring of the Public Utilities Board of the Public Utilities Board.

LEE WING KUI

American, male, aged 53, was appointed the Chief Executive Officer States. Earlier, he spent 15 years at Sprint Nextel, where he held of YTL Communications Sdn Bhd (“YTL Communications”) on senior management positions leading product development, led 1 November 2009 and subsequently appointed as a member of the Sprint’s Innovation Program, and spearheaded IT Architecture for board of directors of YTL Communications on 3 March 2011. the launch of the first nationwide wireless data network in the United States. As the CEO of YTL Communications, Wing maximises his expertise in innovative product development with a deep understanding of Wing holds 33 U.S. patents in wireless and distributed systems and communications and internet technologies to deliver affordable, was recognised as the Asian American Engineer of the Year during world-class quality products and services that improve the way the 2002 U.S. National Engineers Week. people in Malaysia live, learn, work and play. A graduate of the University of Texas at Austin, Wing also holds Prior to joining YTL Communications, Wing led next-generation an Executive Certificate in Management and Leadership from MIT’s mobile internet product development at Clearwire in the United Sloan School of Management.

Notes: None of the Key Senior Management has:– • any directorship in public companies and/or listed issuers; • any family relationship with any Director and/or major shareholder of the Company; • any conflict of interest with the Company; • been convicted of any offences (other than traffic offences) within the past five (5) years; and • been imposed with any public sanction or penalty by the relevant regulatory bodies during the financial year. 51 YTL CORPORATION BERHAD

Statement of Directors’ Responsibilities

The Directors are required by the Companies Act, 2016 (“the Act”) and the Bursa Malaysia Securities Berhad Main Market Listing Requirements (“Listing Requirements”) to prepare financial statements for each financial year which give a true and fair view of the financial position of the Group and of the Company as at the end of the financial year and of the financial performance and cash flows of the Group and of the Company for the financial year then ended.

In preparing the financial statements for the financial year ended 30 June 2020, the Directors have:

• considered the applicable approved accounting standards in Malaysia;

• used appropriate accounting policies and applied them consistently; and

• made judgements and estimates that are reasonable and prudent.

The Directors confirm that the financial statements have been prepared on a going concern basis.

The Directors are responsible for ensuring that the Group and the Company keep accounting records which disclose with reasonable accuracy the financial position of the Group and of the Company which enable them to ensure that the financial statements comply with the Act, Listing Requirements and Malaysian Financial Reporting Standards and International Financial Reporting Standards.

52 ANNUAL REPORT 2020

Audit Committee Report

COMPOSITION 1. Overseeing Financial Reporting

Dato’ Cheong Keap Tai (a) Reviewed the following quarterly financial results and (Chairman/Independent Non-Executive Director) annual financial statements (“Financial Reports”) prior to its recommendation to the Board of Directors for Dato’ Ahmad Fuaad Bin Mohd Dahalan approval:- (Member/Independent Non-Executive Director) • Quarterly financial results for the fourth quarter of financial year ended 30 June 2019, and the annual Faiz Bin Ishak audited financial statements for the financial year (Member/Independent Non-Executive Director) ended 30 June 2019 at the Audit Committee meetings held on 29 August 2019 and 26 September 2019, respectively; TERMS OF REFERENCE • First, second and third quarters of the quarterly The terms of reference of the Audit Committee can be found under results for the financial year ended 30 June 2020 at the “Governance” section on the Company’s website at the Audit Committee meetings held on 25 November www.ytl.com. 2019, 19 February 2020 and 15 June 2020, respectively.

NUMBER OF MEETINGS HELD AND DETAILS OF (b) At the Audit Committee meetings, the Financial Reports ATTENDANCE were presented by the Senior Finance Manager wherein

During the financial year, a total of 5 Audit Committee Meetings the following matters were reviewed and confirmed, were held and the details of attendance are as follows:- with clarification and/or additional information provided wherever required by the Managing Director/Executive Director primarily in charge of the financial management Attendance of the Company:- Dato’ Cheong Keap Tai 5 • Appropriate accounting policies had been adopted Dato’ Ahmad Fuaad Bin Mohd Dahalan 5 and applied consistently, and other statutory and regulatory requirements had been complied with; Faiz Bin Ishak 4 • The Company has adequate resources to continue in operation for the foreseeable future and that SUMMARY OF WORK CARRIED OUT DURING there are no material uncertainties that could lead FINANCIAL YEAR to significant doubt as to the Group’s ability to continue as a going concern; The Audit Committee carried out the following work during the financial year ended 30 June 2020 in the discharge of its functions and duties:-

53 YTL CORPORATION BERHAD

Audit Committee Report

• Significant judgements made by management in (c) Had discussions with HLB twice during the financial year, respect of matters such as impairment assessment on 26 September 2019 and 15 June 2020, without the of goodwill, carrying value of investment, and post- presence of management, to discuss matters concerning employment benefit obligations and the underlying the audit and financial statements. The Audit Committee assumptions and/or estimates used were reasonable also enquired about the assistance and co-operation and appropriate in accordance with the requirements given by management to HLB. of the Malaysian Financial Reporting Standards (“MFRS”); (d) Reviewed the profiles of the audit engagement team which enabled the Audit Committee to assess their • Adequate processes and controls were in place for qualifications, expertise, resources, and independence, effective and efficient financial reporting and as well as the effectiveness of the audit process. The disclosures under the MFRS and Bursa Malaysia external auditors also confirmed their independence in Securities Berhad (“Bursa Securities”) Main Market each of the reports presented to the Audit Committee. Listing Requirements (“Main LR”); The Audit Committee also reviewed on a regular basis, • The Financial Reports were fairly presented in the nature and extend of the non-audit services provided conformity with the relevant accounting standards by HLB and was satisfied with the suitability, performance, in all material aspects. independence and objectivity of HLB.

2. External Audit (e) Assessed the performance of HLB for the financial year (a) Reviewed with the external auditors, HLB Ler Lum PLT ended 30 June 2019 and recommended to the Board of (“HLB”):- Directors for re-appointment at the annual general meeting held on 12 December 2019. • their final report on the audit of the financial statements for financial year ended 30 June 2019 3. Internal Audit setting out their comments and conclusions on the (a) Reviewed with the internal auditors the internal audit significant audit and accounting matters highlighted, reports (including follow-up review reports), the audit including management’s judgements, estimates and/ findings and recommendations, management’s responses or assessments made, and adequacy of disclosures and/or actions taken thereto, and ensured that material in the financial statements; findings were satisfactorily addressed by management; • the audit plan for the financial year ended 30 June 2020 outlining, amongst others, their scope of work, (b) Reviewed and adopted the internal audit risk analysis and areas of audit emphasis and multi-location audit, reports for 2020. Internal audit would leverage on the and development in laws and regulations affecting Group’s risk analysis to focus on the business processes financial reporting and the roles and responsibilities and relevant areas that address the key risks identified; of directors/audit committee members and auditors; (c) Reviewed and adopted the risk-based internal audit plan (b) Reviewed the audit fees proposed by the HLB together for financial year ending 30 June 2021 to ensure sufficient with management and recommended the negotiated scope and coverage of activities of the Company and fees agreed by HLB to the Board of Directors for approval; the Group;

(d) Reviewed internal audit resourcing, with focus on ensuring that the function has sufficient resources together with the right calibre of personnel to perform effectively, and that the head of internal audit has adequate authority to discharge his functions objectively and independently.

54 ANNUAL REPORT 2020

Audit Committee Report

4. Recurrent Related Party Transactions of a Revenue During the year, the IA Department evaluated the adequacy and or Trading Nature (“RRPT”) effectiveness of key controls in responding to risks within the organisation’s governance, operations and information systems (a) Reviewed, on a quarterly basis, the RRPT entered into regarding:- by the Company and/or its subsidiaries with related parties to ensure that the Group’s internal policies and • Reliability and integrity of financial and operational information; procedures governing RRPT are adhered to, the terms • Effectiveness and efficiency of operations; of the shareholder mandate are not contravened, and disclosure requirements of the Main LR are observed; • Safeguarding of assets; and

• Compliance with relevant laws, regulations and contractual (b) Received updates on the directorships and shareholdings obligations. held by the Directors of the Company and persons connected with them via the general notices given under The work of the internal audit function during the year under and in accordance with Section 221 of the Companies review include:- Act, 2016. These disclosures enabled an assessment of the potential or actual conflicts of interest which may 1. Developed the annual internal audit plan and proposed the arise in relation to related party transactions or RRPT; plan to the Audit Committee.

(c) Reviewed the 2019 circular to shareholders in relation 2. Conducted scheduled and special internal audit engagements, to the renewal of shareholder mandate for RRPT and focusing primarily on the effectiveness of internal controls new shareholder mandate for additional RRPT, prior to and recommending improvements where necessary. its recommendation to the Board of Directors for approval.

3. Conducted follow-up reviews to assess if appropriate action 5. Annual Report has been taken to address issues highlighted in previous audit (a) Reviewed the Audit Committee Report, and Statement reports. on Risk Management and Internal Control before recommending these to the Board of Directors for 4. Presented significant audit findings and areas for improvements approval for inclusion in 2019 Annual Report. raised by the IA to the Audit Committee for consideration on the recommended corrective measures together with the management’s response. INTERNAL AUDIT FUNCTION 5. Conducted recurrent related party transactions reviews to The objective of the Internal Audit (“IA”) is to help management assess accuracy and completeness of reporting for presentation evaluate the effectiveness and efficiency of the internal control to the Audit Committee, and ensure compliance with the Main systems. The IA is part of the Company and the Group’s governance LR. system, and according to the Malaysian Code of Corporate Governance, the IA is in charge of supervising internal control 6. Conducted discussions with management in identifying activities. IA’s goal is to focus mainly on risk-based audits related significant concerns and risk areas perceived by management to operations and compliance that are aligned with the risks of for inclusion in the internal audit plan. the Company and the Group to ensure that the relevant controls addressing those risks are reviewed. Costs amounting to RM3,485,375 were incurred in relation to the internal audit function for the financial year ended 30 June 2020.

55 YTL CORPORATION BERHAD

Nominating Committee Statement for the financial year ended 30 June 2020

NOMINATING COMMITTEE (“NC”) i. Review of Directors proposed for appointment or redesignation The NC assists the Board of Directors of YTL Corporation Berhad (the “Company”) (“Board”) in discharging its responsibilities by In September 2019, the NC evaluated and recommended overseeing the selection and assessment of Directors to ensure to the Board, the following candidates who were that the composition of the Board meets the needs of the Company nominated to fill the vacant positions arising from the and its subsidiaries (“YTL Corp Group”). resignation of the late Mr Eu Peng Meng @ Leslie Eu on 12 June 2019:- The terms of reference of the NC can be found under the “Governance” section on the Company’s website at www.ytl.com. Name Nominated for

(1) Puan Raja Noorma Binti Appointment to Members of the NC are as follows:- Raja Othman (“Puan Raja the Board and NC • Faiz Bin Ishak (Chairman) Noorma”) • Dato’ Cheong Keap Tai (2) Dato’ Cheong Keap Tai Redesignation as • Raja Noorma Binti Raja Othman (appointed on 5 September (“Dato’ Cheong”) chairman of the 2019) Audit Committee (“AC”) The NC met twice during financial year ended 30 June 2020, attended by all members. (3) Encik Faiz Bin Ishak Appointment as (“Encik Faiz”) member of the AC ACTIVITIES OF THE NC FOR THE FINANCIAL YEAR ENDED 30 JUNE 2020 The NC evaluated, amongst others, the candidates’ background, knowledge, experience, skills, external (a) Board nomination and election process and criteria appointments and associated time commitments expected used of the roles. As Dato’ Cheong and Encik Faiz were also The NC is responsible for considering and making members of the Board and Board Committees, the NC recommendations to the Board candidates for directorship already had insights into their character, integrity, when the need arises such as to fill a vacancy arising from attributes and whether they would be a right fit to resignation or retirement or to close any skills, competencies, complement the roles required. As to Puan Raja Noorma’s experience or diversity gap that has been identified. Candidates candidacy, the NC concurred that she fulfilled the criteria may be proposed by the Managing Director or any Director or necessary for the position of independent director. shareholder and must fulfil the requirements prescribed under the relevant laws and regulations for appointment as director. The NC also recommended to the Board for Puan Raja In assessing the suitability of a candidate, the NC will take Noorma to stand for re-election pursuant to Article 90 into consideration a number of factors including but not limited of the Company’s Constitution at the Thirty-Sixth Annual to the candidate’s skills, knowledge, expertise, competence General Meeting, if appointed. and experience, time commitment, character, professionalism and integrity. For the position of independent non-executive ii. Review of Directors proposed for re-election director, the NC will evaluate the candidate’s ability to discharge In accordance with Article 86 of the Company’s Constitution such responsibilities as expected from an independent non- (“Article 86”), Directors are to be elected at every annual executive director. general meeting when one-third of the Directors longest in office shall retire, subject always to the requirement that all Directors shall retire from office once at least in each three years, and if eligible, may offer themselves for re-election.

56 ANNUAL REPORT 2020

Nominating Committee Statement for the financial year ended 30 June 2020

In June 2020, based on the results of the assessment or more, bring to the Board. For these reasons, the Board, undertaken for the financial year, the NC resolved to save for Dato’ Cheong Keap Tai, recommends and supports recommend to the Board that Dato’ Yeoh Seok Kian, the resolutions for his continuing in office as INED of Dato’ Yeoh Soo Min, Dato’ Yeoh Seok Hong and Dato’ the Company which will be tabled for shareholders’ Cheong Keap Tai, who are due to retire pursuant to approval to be sought via the single-tier voting process Article 86 at the Thirty-Seventh Annual General Meeting at the forthcoming AGM. of the Company (“AGM”), stand for re-election. (b) Annual assessment The Board, save for the members who had abstained In May 2020, the annual assessment of the effectiveness of from deliberations on their own re-election, supported the Board as a whole, the Board Committees and individual the NC’s views and recommends that shareholders vote Directors was carried out with the objectives of assessing in favour of the resolutions for their re-election at the whether the Board and the Board Committees, as well as the forthcoming AGM. Directors have effectively performed its/their roles and fulfilled its/their responsibilities, and devoted sufficient time iii. Review of Director proposed for continuing in commitment to the Company’s affairs; and to recommend office as Independent Non-Executive Director areas for improvement. The assessment exercise was facilitated (“INED”) by the Company Secretary and took the form of completion As part of the annual assessment of Director, an of questionnaires/evaluation forms. assessment of independence was conducted on the INED. In addition to the criteria for independence In evaluating the effectiveness of the Board, several areas prescribed in the Main LR and Practice Note 13, the INED were reviewed including the composition, degree of was assessed on his ability and commitment to continue independence, right mix of expertise, experience and skills, to bring independent and objective judgment to board quality of information and decision making, and boardroom deliberations. activities. Board Committees were assessed on their composition, expertise, and whether their functions and The Board is of the view that there are significant responsibilities were effectively discharged in accordance advantages to be gained from the INED who has served with their respective terms of reference. on the Board for more than 12 years as he possesses greater insights and knowledge of the businesses, The assessment of the individual Directors covered areas operations and growth strategies of the YTL Corp Group. such as fit and properness, contribution and performance, Furthermore, the ability of a director to serve effectively calibre, character/personality and time commitment and as an independent director is very much a function of whether they have shown the will and ability to deliberate his calibre, qualification, experience and personal qualities, constructively, ask the right questions and confidence to particularly of his integrity and objectivity in discharging stand up for a point of view. his responsibilities in good faith in the best interest of the company and his duty to vigilantly safeguard the Results of the assessment were summarised and discussed interests of the shareholders of the company. at the NC meeting held in June 2020 and reported to the Board by the NC. No evident weakness or shortcoming was Dato’ Cheong Keap Tai abstained from deliberation at identified which require mitigating measure. The Board and the NC meeting on his continuing in office as INED. the Board Committees continue to operate effectively and the performance of the Directors and the time commitment The Board, save for Dato’ Cheong Keap Tai who had in discharging their duties as Directors of the Company for abstained from deliberations on the matter, is satisfied the year ended 30 June 2020 were satisfactory. These results with the skills, contributions and independent judgment form the basis of the NC’s recommendations to the Board for that Dato’ Cheong Keap Tai, who has served for 12 years the re-election of Directors at the AGM.

57 YTL CORPORATION BERHAD

Nominating Committee Statement for the financial year ended 30 June 2020

(c) Review of the NC Statement for financial year ended INDUCTION, TRAINING AND DEVELOPMENT OF 30 June 2019 DIRECTORS

The NC Statement was reviewed by the NC prior to its Upon joining the Board, a newly appointed Director will be given an recommendation to the Board for approval for inclusion in induction pack containing the Company’s annual report, Constitution, 2019 Annual Report. and schedule of meetings of the Board and Committee (if the Director is also a Committee member) which will serve as an initial introduction (d) Review of the evaluation criteria in the assessment to the YTL Corp Group as well as an ongoing reference. forms

The NC reviewed the evaluation criteria in the assessment The Board, through the NC, assesses the training needs of its forms and concurred that the assessment forms be maintained Directors on an ongoing basis by determining areas that would as the evaluation criteria remained relevant and consistent with best strengthen their contributions to the Board. the Malaysian Code on Corporate Governance and the Main LR. Besides the findings from the annual performance assessment of Directors, which provide the NC with useful insights into the training POLICY ON BOARD COMPOSITION needs of the Directors, each Director is requested to identify appropriate training that he/she believes will enhance his/her As the Board’s overriding aim is to maintain a strong and effective contribution to the Board. Board, it seeks to ensure that all appointments are made on merit, taking into account the collective balance of elements such as The Board has taken steps to ensure that its members have access skills, experience, age, gender, ethnicity, background and perspective. to appropriate continuing education programmes. The Company The Board recognises the importance of encouraging and developing Secretary facilitates the organisation of in-house development female talent at all levels. Currently, there are three female directors programmes and keeps Directors informed of relevant external on the Board and make up 25% of the full Board. Although it has training programmes. not set any specific measurable objectives, the Board intends to continue its current approach to diversity in all aspects while at During the financial year ended 30 June 2020, the following two the same time seeking Board members of the highest calibre, and in-house training programmes were organised for the Directors:- with the necessary strength, experience and skills to meet the • YTL Leadership Conference 2019; needs of the Company. • Integrated Reporting for Directors of Public Listed Companies.

All the Directors have undergone training programmes during the financial year ended 30 June 2020. The conferences, seminars and training programmes attended by one or more of the Directors covered the following areas:-

Seminars/Conferences/Training Attended by

▸ Corporate Governance/Risk Management and Internal Controls/Anti- Corruption/Financial/Taxation

Bursa Malaysia’s Sustainability Advocacy Programme: Recommendation of the Task Faiz Bin Ishak Force on Climate-Related Financial Disclosure (9 July 2019)

National Tax Conference 2019 – Economic Prosperity & Taxation Dato’ Cheong Keap Tai (5 & 6 August 2019)

Malaysian Institute of Accountants – MFRS 15 Revenue from Contracts with Customers, Dato’ Cheong Keap Tai Plus Tax Considerations (17 September 2019)

58 ANNUAL REPORT 2020

Nominating Committee Statement for the financial year ended 30 June 2020

Seminars/Conferences/Training Attended by

▸ Corporate Governance/Risk Management and Internal Controls/Anti- Corruption/Financial/Taxation (Cont’d.)

Capital Market Director Programme (“CMDP”) – Module 1: Directors as Gatekeepers of Raja Noorma Binti Raja Othman Market Participants & Module 2A: Business Challenges and Regulatory Expectations (Equities & Future Broking) (14 October 2019)

CMDP – Module 3: Risk Oversight and Compliance – Action Plan for Board of Directors Raja Noorma Binti Raja Othman (15 October 2019)

National Tax Seminar 2019 Dato’ Cheong Keap Tai (15 October 2019)

CMDP – Module 4: Current and Emerging Regulatory Issues in the Capital Market Raja Noorma Binti Raja Othman (16 October 2019)

Bursa Malaysia – “Integrated Reporting: Communicating Value Creation” Programme Syed Abdullah Bin Syed Abd Kadir (16 October 2019)

MIA International Accountants Conference 2019 Dato’ Cheong Keap Tai (22 & 23 October 2019)

Bursa Malaysia – Session on Corporate Governance & Anti-Corruption Dato’ Yeoh Soo Min (31 October 2019)

Bursa Malaysia’s Workshop on Corporate Liability Provision (Section 17A) of the MACC Syed Abdullah Bin Syed Abd Kadir Act 2009 (5 November 2019)

The Securities Commission Malaysia’s Audit Oversight Board Conversation with Audit Faiz Bin Ishak Committees (22 November 2019)

Malaysian Institute of Corporate Governance - Board Evaluation & Effectiveness Faiz Bin Ishak Assessment (3 December 2019)

CT Risk Solutions Limited Hong Kong – Workshop on the Internal Capital Adequacy Raja Noorma Binti Raja Othman Assessment Process (15 January 2020)

Asset-Liability and Risk Management – Regulatory Principles and Market Best Practice Raja Noorma Binti Raja Othman (27 February 2020)

Integrated Reporting for Directors of Public Listed Companies Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping (12 March 2020) Dato’ Cheong Keap Tai Dato’ Yeoh Soo Min Dato’ Sri Michael Yeoh Sock Siong Dato’ Yeoh Soo Keng Dato’ Mark Yeoh Seok Kah Dato’ Ahmad Fuaad Bin Mohd Dahalan Faiz Bin Ishak Raja Noorma Binti Raja Othman

59 YTL CORPORATION BERHAD

Nominating Committee Statement for the financial year ended 30 June 2020

Seminars/Conferences/Training Attended by

▸ Corporate Governance/Risk Management and Internal Controls/Anti- Corruption/Financial/Taxation (Cont’d.) Board & Executive Pay During and Post Covid-19 Raja Noorma Binti Raja Othman (18 June 2020) YTL Anti-Bribery & Corruption Online Training (June 2020) Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping Dato’ Yeoh Seok Kian Dato’ Yeoh Soo Min Dato’ Yeoh Seok Hong Dato’ Sri Michael Yeoh Sock Siong Dato’ Yeoh Soo Keng Dato’ Mark Yeoh Seok Kah Syed Abdullah Bin Syed Abd. Kadir ▸ Trade/Economic Development/Investment/Technology Beyond Paradigm Summit 2019 Syed Abdullah Bin Syed Abd Kadir (17 & 18 July 2019) Financing the Sustainable Development Goals: Malaysian Private Sector Role in Bridging Faiz Bin Ishak the Gap from Goals to Actions (11 September 2019) Malaysian Dutch Business Council – Sustainability by Design: Practical Steps for Malaysian Syed Abdullah Bin Syed Abd Kadir Businesses (17 September 2019) Malaysia REIT Forum 2019 – Opportunities in the New Malaysia Dato’ Ahmad Fuaad Bin Mohd Dahalan (31 October 2019) Organisation for Economic Co-operation and Development – Asian Public Governance Dato’ Yeoh Soo Min Forum on Gender Quality and Mainstreaming (12 & 13 December 2019) Cybersecurity & Work-From-Home Security Challenges Amidst Covid-19 Pandemic Raja Noorma Binti Raja Othman (4 June 2020) YTL Foundation Online Dialogue: Education in an age of uncertainty Dato’ Yeoh Soo Min (12 June 2020) Dato’ Yeoh Soo Keng ▸ Leadership and Business Management/Corporate Responsibility/Sustainability ZafigoX 2019 Forum (21 & 22 September 2019) Dato’ Yeoh Soo Min YTL Leadership Conference 2019 Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping (15 November 2019) Dato’ Yeoh Seok Kian Dato’ Yeoh Soo Min Dato’ Yeoh Seok Hong Dato’ Sri Michael Yeoh Sock Siong Dato’ Yeoh Soo Keng Dato’ Mark Yeoh Seok Kah Dato’ Ahmad Fuaad Bin Mohd Dahalan Syed Abdullah Bin Syed Abd Kadir Faiz Bin Ishak Raja Noorma Binti Raja Othman

60 ANNUAL REPORT 2020

Corporate Governance Overview Statement for the financial year ended 30 June 2020

The Board of Directors (“Board”) of YTL Corporation Berhad (“YTL Key elements of the Board’s stewardship responsibilities include: Corp” or “Company”) remains firmly committed to ensuring an • Reviewing and adopting strategic plans for the YTL Corp Group appropriate and sound system of corporate governance throughout to ensure long-term, sustainable value creation for the benefit the Company and its subsidiaries (“YTL Corp Group”). The YTL Corp of its stakeholders; Group has a long-standing commitment to corporate governance • Overseeing the conduct of the YTL Corp Group’s business and protection of stakeholder value, which has been integral to the operations and financial performance, including the economic, YTL Corp Group’s achievements and strong financial profile to date. environmental and social impacts of its operations;

The YTL Corp Group’s corporate governance structure is a • Identifying and understanding the principal risks affecting the fundamental part of the Board’s responsibility to protect and YTL Corp Group’s businesses in order to determine the enhance long-term shareholder value and the financial performance appropriate risk appetite within which management is expected of the YTL Corp Group, whilst taking into account the interests of to operate; all stakeholders. • Maintaining a sound risk management and internal control framework, supported by appropriate mitigation measures; In implementing its governance system and ensuring compliance • Succession planning; and with the Main Market Listing Requirements (“Listing Requirements”) • Overseeing the development and implementation of shareholder of Bursa Malaysia Securities Berhad (“Bursa Securities”), the Board communications policies. has been guided by the principles and practices set out in the Malaysian Code on Corporate Governance (“Code”) issued by the The Board is led by the Chairman who is responsible for instilling Securities Commission Malaysia. good corporate governance practices, leadership and effectiveness of the Board. An overview of the Board’s implementation of the practices set out in the Code during the financial year ended 30 June 2020 is There is a balance of power, authority and accountability between detailed in this statement, together with targeted timeframes for the Executive Chairman, Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, measures expected to be implemented in the near future, where and the Managing Director, Dato’ Yeoh Seok Kian, with a clear applicable, and the Company’s Corporate Governance Report (“CG division of responsibility between the running of the Board and Report”) for the financial year ended 30 June 2020 is available at the Company’s business respectively. The positions of Executive the Company’s website at www.ytl.com and has been released via Chairman and Managing Director are separate and clearly defined, the website of Bursa Securities at www.bursamalaysia.com in and are held by different members of the Board. conjunction with the Annual Report.

The Chairman is responsible for leadership of the Board in ensuring the effectiveness of all aspects of its role, and is primarily responsible PRINCIPLE A: for leading the Board in setting the values and standards of the BOARD LEADERSHIP AND EFFECTIVENESS Company, the orderly and effective conduct of the meetings of Responsibilities of the Board the Board and shareholders, maintaining a relationship of trust with and between the Executive and Non-Executive Directors, YTL Corp is led and managed by an experienced Board with a wide ensuring the provision of accurate, timely and clear information and varied range of expertise to address and manage the complexity to Directors, facilitating the effective contribution of Non-Executive and scale of the YTL Corp Group’s operations. This broad spectrum Directors and ensuring that constructive relations are maintained of skills and experience ensures the YTL Corp Group is under the between Executive and Non-Executive Directors. guidance of an accountable and competent Board. The Directors recognise the key role they play in charting the strategic direction, The Managing Director is responsible for, amongst others, overseeing development and control of the YTL Corp Group. the day-to-day running of the business, implementation of Board policies and strategies, and making of operational decisions, serving as the conduit between the Board and the Management in ensuring

61 YTL CORPORATION BERHAD

Corporate Governance Overview Statement for the financial year ended 30 June 2020

the success of the Company’s governance and management Board Meetings and Procedures functions, ensuring effective communication with shareholders Board meetings are scheduled with due notice in advance at least and relevant stakeholders, providing strong leadership, i.e., effectively 5 times in a year in order to review and approve the annual and communicating the vision, management philosophy and business interim financial results. Additional meetings may also be convened strategy to employees, and keeping the Board informed of salient on an ad-hoc basis when significant issues arise relating to the aspects and issues concerning the Group’s operations. YTL Corp Group and when necessary to review the progress of its operating subsidiaries in achieving their strategic goals. The Board The Managing Director and Executive Directors are accountable to met 5 times during the financial year ended 30 June 2020. the Board for the profitability and development of the YTL Corp Group, consistent with the primary aim of enhancing long-term The Directors are fully apprised of the need to determine and shareholder value. The Independent Non-Executive Directors have disclose potential or actual conflicts of interest which may arise the experience and business acumen necessary to carry sufficient in relation to transactions or matters which come before the Board. weight in the Board’s decisions and the presence of these In accordance with applicable laws and regulations, the Directors Independent Non-Executive Directors brings an additional element formally disclose any direct or indirect interests or conflicts of of balance to the Board as they do not participate in the day-to- interests in such transactions or matters as and when they arise day running of the YTL Corp Group. and abstain from deliberations and voting at Board meetings as required. The roles of Executive and Non-Executive Directors are differentiated, both having fiduciary duties towards shareholders. Executive The Directors have full and unrestricted access to all information Directors have a direct responsibility for business operations pertaining to the YTL Corp Group’s business and affairs to enable whereas Non-Executive Directors have the necessary skill and them to discharge their duties. At least one week prior to each experience to bring an independent judgment to bear on issues Board meeting, all Directors receive the agenda together with a of strategy, performance and resources brought before the Board. comprehensive set of Board papers encompassing qualitative and The Executive Directors are collectively accountable for the running quantitative information relevant to the business of the meeting. and management of the YTL Corp Group’s operations and for This allows the Directors to obtain further explanations or ensuring that strategies are fully discussed and examined, and clarifications, where necessary, in order to be properly briefed take account of the long-term interests of shareholders, employees, before each meeting. customers, suppliers and the many communities in which the YTL Corp Group conducts its business. Board papers are presented in a consistent, concise and comprehensive format, and include, where relevant to the proposal In the discharge of their responsibilities, the Directors have put forward for the Board’s deliberation, approval or knowledge, established functions which are reserved for the Board and those progress reports on the YTL Corp Group’s operations and detailed which are delegated to management. Key matters reserved for information on corporate proposals, major fund-raising exercises the Board’s approval include overall strategic direction, business and significant acquisitions and disposals. Where necessary or expansion and restructuring plans, material acquisitions and prudent, professional advisers may be on hand to provide further disposals, expenditure over certain limits, issuance of new securities information and respond directly to Directors’ queries. In order to and capital alteration plans. Further information on authorisation maintain confidentiality, Board papers on issues that are deemed procedures, authority levels and other key processes can also be to be price-sensitive may be handed out to Directors during the found in the Statement on Risk Management & Internal Control Board meeting. set out in this Annual Report.

The minutes of the Board and/or Board Committee meetings are The Board believes sustainability is integral to the long-term success circulated and confirmed at the next meeting. Once confirmed, the of the YTL Corp Group. Further information on the YTL Corp Group’s minutes of the Board Committee meetings are subsequently sustainability activities can be found in YTL Corp’s Sustainability presented to the Board for notation. Report 2020, a separate report published in conjunction with this Annual Report.

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Corporate Governance Overview Statement for the financial year ended 30 June 2020

Company Secretary Business Conduct and Ethics

The Board is supported by a professionally qualified and competent The Directors observe and adhere to the Code of Ethics for Company Company Secretary. The Company Secretary, Ms Ho Say Keng, is Directors established by the Companies Commission of Malaysia, a Fellow of the Chartered Association of Certified Accountants, a which encompasses the formulation of corporate accountability registered member of the Malaysian Institute of Accountants and standards in order to establish an ethical corporate environment. an affiliate member of the Malaysian Institute of Chartered YTL Corp has an established track record for good governance and Secretaries and Administrators, and is qualified to act as Company ethical conduct. The Code of Conduct and Business Ethics which Secretary under Section 235(2)(a) of the Companies Act 2016. also sets out the whistleblowing policy and procedures, was formalised by the YTL Group of Companies during the last financial The Company Secretary ensures that Board procedures are adhered year 30 June 2019 and further updated during the current year to at all times during meetings and advises the Board on matters under review, following the adoption and implementation of the including corporate governance issues and the Directors’ YTL Group’s Anti-Bribery and Corruption Policy, as detailed in the responsibilities in complying with relevant legislation and regulations. following section. A copy of the Code of Conduct and Business The Company Secretary works very closely with Management for Ethics can be found on the Company’s website at www.ytl.com. timely and appropriate information, which will then be passed on to the Directors. In accordance with the Board’s procedures, Anti-Bribery and Corruption Policy (“ABC Policy”) deliberations and conclusions in Board meetings are recorded by During the financial year under review, the ABC Policy was formalised the Company Secretary, who ensures that accurate and proper for the YTL Group. The objective of the ABC Policy is to further records of the proceedings of Board meetings and resolutions enforce the YTL Group’s Code of Conduct and Business Ethics in passed are recorded and kept in the statutory register at the order to ensure that all Directors and employees understand their registered office of the Company. responsibilities in compliance with the YTL Group’s zero tolerance for bribery and corruption within the organisation. This is in line During the financial year under review, the Company Secretary with the new corporate liability provision in Section 17A of the attended training, seminars and regulatory briefings and updates Malaysian Anti-Corruption Commission Act 2009 (“MACC Act”) which relevant for the effective discharge of her duties. The Company came into force on 1 June 2020. Secretary also carried out an ongoing review of existing practices in comparison with the new measures introduced in the Code. The ABC Policy was deliberated and approved by the Board on 20 February 2020. It outlines the YTL Group’s strategies in identifying, Board Charter preventing and managing bribery and corruption issues. The policies The Board’s functions are governed and regulated by its Charter, and procedures put in place are guided by the Guidelines on the Constitution of the Company and the various applicable Adequate Procedures issued pursuant to Section 17A(5) of MACC legislation, Listing Requirements and other regulations and codes. Act. The ABC Policy applies to all Directors, managers and employees The Board’s Charter was formalised during the financial year ended of the Company in dealing with external parties in the commercial 30 June 2014 and a copy can be found under the “Governance” context. The policy will be reviewed at least once every three years section on the Company’s website at www.ytl.com. The Board to ensure that it continues to remain relevant, appropriate and Charter clearly sets out the role and responsibilities of the Board, effective to enforce the principles highlighted therein and to ensure Board committees, Directors and Management and the issues and continued compliance with the prevailing law. A copy of the ABC decisions reserved for the Board. The Board Charter is reviewed Policy can be found on the Company’s website at www.ytl.com. and updated periodically when necessary. A comprehensive implementation plan has been established to communicate and disseminate the ABC Policy throughout the YTL Group through online training modules and other communication methods. Previously planned town hall sessions have been substituted with more electronic communications in compliance with the physical distancing guidelines implemented in response to the COVID-19 pandemic. 63 YTL CORPORATION BERHAD

Corporate Governance Overview Statement for the financial year ended 30 June 2020

All directors and employees of the YTL Group are required to read The expertise and experience in both the day-to-day running of and understand the ABC Policy and the Code of Conduct and the Group’s businesses and the determination and setting of its Business Ethics, successfully complete the online training modules broader strategy, lies with the Executive Directors in order to to reinforce their understanding of the policy and sign the YTL ensure the ongoing ability to fulfil their roles and responsibilities Group’s Integrity Pledge in acknowledgement of their obligations as stewards of the Group’s businesses. and responsibilities. Nevertheless, the Company has in place appropriate and rigorous Compliance with the ABC Policy will be monitored closely, both on governance structures and internal controls necessary to safeguard an ongoing basis and in conjunction with the annual assessment the assets of the Group and protect shareholder value. There is of the Group’s corruption risks. The annual risk assessment is robust oversight in the form of the Board’s Audit, Remuneration carried out to identify the corruption risks to which the Group is and Nominating committees, all of which are chaired by and comprise exposed and the appropriateness of the mitigation measures solely Independent Non-Executive Directors. established to minimise the exposure to these risks. The Board is of the view that the current Independent Non-Executive Composition of the Board Directors have the experience and business acumen necessary to carry sufficient weight in the Board’s decisions, and act in the best During the financial year under review, there was one resignation interests of the shareholders. from the Board, namely, the late Mr Eu Peng Meng @ Leslie Eu. Subsequently, on 5 September 2019, Puan Raja Noorma Binti Raja There is currently one Independent Non-Executive Director, Dato’ Othman was appointed to the Board. The Board currently has 12 Cheong Keap Tai, who has served on the Board for a period Directors, comprising 8 executive members and 4 independent exceeding the nine-year term limit recommended in the Code. In non-executive members. The Independent Directors currently accordance with current practice, approval through a vote of all comprise 33.3% of the Board, in compliance with the Listing shareholders via the single-tier voting process will continue to be Requirements, which require one-third of the Board to be sought at the forthcoming thirty-seventh Annual General Meeting independent. (“AGM”) of YTL Corp for Dato’ Cheong Keap Tai to continue to serve as an Independent Non-Executive Director. Further information on The Directors are cognisant of the recommendation in the Code the review and assessment process can be found in the Nominating for the Board to comprise a majority of independent directors, and Committee Statement, whilst details of the resolution, together will assess the composition and size of the Board on an ongoing with the rationale for approval sought, can be found in the Notice basis to ensure the needs of the Company are met. of Annual General Meeting in this Annual Report.

YTL Corp is 50.02%-owned by Yeoh Tiong Lay & Sons Holdings In accordance with the Company’s Constitution, at least one-third Sdn Bhd (as at 30 June 2020). The Executive Directors are appointed of the Directors are required to retire from office at each AGM and by the major shareholder in accordance with its rights under the may offer themselves for re-election by rotation. Directors who Companies Act 2016 and the Constitution of the Company. The are appointed by the Board during the financial year are subject interests of the major shareholder are fully aligned with those of to re-election by shareholders at the next AGM held following their all shareholders of the Company. appointments.

YTL Corp is majority-owned by a single shareholder, unlike other The names of Directors seeking re-election at the forthcoming listed companies that may have a dispersed shareholder base which AGM are disclosed in the Notice of Annual General Meeting, which enables a shareholder to exercise control despite holding a minority can be found in this Annual Report. The details of the Directors stake. can be found in the Profile of the Board of Directors set out in this Annual Report and this information is also available under the “Governance” section on the Company’s website at www.ytl.com.

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Corporate Governance Overview Statement for the financial year ended 30 June 2020

Board and Senior Management Appointments The assessment exercise was facilitated by the Company Secretary and took the form of completion of questionnaires/evaluation The Nominating Committee is chaired by an Independent Non- forms comprising a Board and Nominating Committee Effectiveness Executive Director and is responsible for assessing suitable Evaluation Form, Individual Director Performance Evaluation Form, candidates for appointment to the Board for approval, with due Independent Directors’ Evaluation Form, Audit Committee regard for diversity, taking into account the required mix of skills, Effectiveness Evaluation Form and Audit Committee Members experience, age, gender, ethnicity, background and perspective of Evaluation by Nominating Committee Form. As recommended in members of the Board before submitting its recommendation to the Board for decision. The Nominating Committee is chaired by the Code, the Board will endeavour to utilise independent experts and comprises solely Independent Non-Executive Directors. to facilitate the evaluation process, as and when appropriate. Further information on the activities of the Nominating Committee Whilst it has, to date, not been necessary to do so given the can be found in the Nominating Committee Statement set out in expertise of the Independent Non-Executive Directors, the Board this Annual Report. This information is also available under the will also endeavour to utilise independent sources including external “Governance” section on the Company’s website at www.ytl.com. human resources consultants and specialised databases, as appropriate. Remuneration

Directors’ remuneration is decided in line with the objective Meanwhile, members of senior management are selected based recommended by the Code to determine the remuneration for on relevant industry experience, with due regard for diversity in Directors so as to attract, retain, motivate and incentivise Directors skills, experience, age, gender, ethnicity, background and perspective, of the necessary calibre to lead the YTL Corp Group successfully. In and are appointed by the Executive Chairman and/or the Managing general, the remuneration of the Directors is reviewed against the Director following recommendation by the Executive Director in performance of the individual and the YTL Corp Group. The Executive charge of the relevant division. Directors’ remuneration consists of basic salary, other emoluments and other customary benefits as appropriate to a senior management As the Board’s overriding aim is to maintain a strong and effective member. The component parts of remuneration are structured so Board, it seeks to ensure that all appointments are made on merit, as to link rewards to performance. Directors do not participate in taking into account the collective balance of elements such as decisions regarding their own remuneration packages and Directors’ skills, experience, age, gender, ethnicity, background and perspective. fees must be approved by shareholders at the AGM.

The Board recognises the importance of encouraging and developing During the financial year under review, a Remuneration Committee female talent at all levels and has a strong complement of female divisional heads and chief executive officers. Currently there are was established to implement the policies and procedures on three female Directors comprising 25.0% of the Board and, therefore, remuneration of Directors and to make recommendations to the whilst the Board has not met the target of 30% women directors Board on matters relating to the remuneration of Directors. The set out in the Code, it will continue to seek Board members of the Remuneration Committee will begin reporting on its activities in highest calibre, and with the necessary strength, experience and the next financial year ending 30 June 2021. skills to meet the needs of the YTL Corp Group. Details of the Directors’ remuneration categorised into appropriate Evaluation of the Board components can be found in Note 7 in the Notes to the Financial Statements in this Annual Report. Meanwhile, as regards the Annual evaluation of the Board as a whole, Board Committees and remuneration of the YTL Corp Group’s senior management team, the individual Directors is carried out by the Nominating Committee. the Board is of the view that the disclosure of these details would The evaluation carried out during the financial year under review not be in the best interests of YTL Corp Group due to confidentiality involved an annual assessment of the effectiveness of each and the competitive nature of the industries in which the YTL Corp individual Director and the Board as a whole with the objectives Group operates, as well as for business and personal security reasons. of assessing whether the Board and the Directors had effectively performed its/their roles and fulfilled its/their responsibilities, and devoted sufficient time commitment to the Company’s affairs, in addition to recommending areas for improvement. 65 YTL CORPORATION BERHAD

Corporate Governance Overview Statement for the financial year ended 30 June 2020

Board Commitment Audit Committee

In accordance with the Listing Requirements, each member of the The Company has in place an Audit Committee which comprises Board holds not more than five directorships in public listed solely Independent Non-Executive Directors, in compliance with companies. This ensures that their commitment, resources and the Listing Requirements and the Code, namely Dato’ Cheong Keap time are focused on the affairs of the YTL Corp Group thereby Tai, Dato’ Ahmad Fuaad Bin Mohd Dahalan, and En Faiz Bin Ishak. enabling them to discharge their duties effectively. The Chairman of the Audit Committee is Dato’ Cheong Keap Tai, which fulfils the recommendation under the Code that the chairman Presently, each Board member is required to assess (via the annual of the audit committee should not be the chairman of the Board. assessment process) whether he/she devotes the necessary time and energy to fulfilling his/her commitments to the Company. The The members of the Audit Committee possess a wide range of Board recognises that an individual’s capacity for work varies necessary skills to discharge their duties, and are financially literate depending on various factors that weigh very much on his/her and able to understand matters under the purview of the Audit own assessment. Hence, having rigid protocols in place before any Committee including the financial reporting process. The members new directorships may be accepted is not practical. Each Board of the Audit Committee also intend to continue to undertake member is also expected to inform the Board whenever he/she is professional development by attending training to keep themselves appointed as an officer of a corporation. abreast of relevant developments in accounting and auditing standards, practices and rules. The details of each Director’s attendance of Board meetings can be found in the Profile of the Board of Directors whilst details of The Audit Committee holds quarterly meetings to review matters the training programmes attended during the year under review including the YTL Corp Group’s financial reporting, the audit plans are disclosed in the Nominating Committee Statement in this Annual for the financial year and recurrent related party transactions, as Report. This information is also available under the “Governance” well as to deliberate the findings of the internal and external auditors. section on the Company’s website at www.ytl.com. The Audit Committee met 5 times during the financial year ended 30 June 2020. Full details of the composition and a summary of PRINCIPLE B: the work carried out by the Audit Committee during the financial EFFECTIVE AUDIT AND RISK MANAGEMENT year can be found in the Audit Committee Report set out in this Annual Report. This information and the terms of reference of the Integrity in Financial Reporting Audit Committee are available under the “Governance” section on The Directors are responsible for ensuring that financial statements the Company’s website at www.ytl.com. are drawn up in accordance with the Listing Requirements, Malaysian Financial Reporting Standards, International Financial Reporting The Audit Committee has established formal and professional Standards and the requirements of the Companies Act 2016 in arrangements for maintaining an appropriate relationship with the Malaysia. The Statement of Directors’ Responsibilities made pursuant Company’s external auditors, HLB Ler Lum PLT (“HLB”). The external to Section 248-249 of the Companies Act 2016 is set out in this auditors also attend each AGM in order to address clarifications Annual Report. sought pertaining to the audited financial statements by shareholders.

In presenting the financial statements, the Company has used The Audit Committee has formal policies to assess the suitability, appropriate accounting policies, consistently applied and supported objectivity and independence of the external auditors. These policies by reasonable and prudent judgments and estimates, to present also include a requirement that a former key audit partner must a true and fair assessment of the Company’s position and prospects. observe a cooling-off period of two years before being appointed Interim financial reports were reviewed by the Audit Committee as a member of the Audit Committee. However, none of the Audit and approved by the Board prior to release to Bursa Securities. Committee members were formerly audit partners of YTL Corp’s external auditors.

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Corporate Governance Overview Statement for the financial year ended 30 June 2020

Details of the audit and non-audit fees paid/payable to HLB for The internal audit function adopts the framework based on the the financial year ended 30 June 2020 are as follows:- International Standards for the Professional Practice of Internal Auditing issued by the Institute of Internal Auditors. Company Group RM’000 RM’000 The activities of the internal audit function during the year under review included:- Statutory audit fees paid/payable • Developing the annual internal audit plan and proposing this to HLB 244 2,349 plan to the Board; Non-audit fees paid/payable to:- • Conducting scheduled internal audit engagements, focusing – HLB 16 34 primarily on the effectiveness of internal controls and – Affiliates of HLB 12 299 recommending improvements where necessary; 28 333 • Conducting follow-up reviews to assess if appropriate action has been taken to address issues highlighted in audit reports; Risk Management & Internal Control and

The Board acknowledges its overall responsibility for maintaining • Presenting audit findings to the Board for consideration. a sound system of risk management and internal control to safeguard the investment of its shareholders and the YTL Corp Group’s assets, Further details of the YTL Corp Group’s internal audit function are and that these controls are designed to provide reasonable, but contained in the Statement on Risk Management & Internal Control not absolute, assurance against the risk of occurrence of material and the Audit Committee Report as set out in this Annual Report. errors, fraud or losses.

Details of the YTL Corp Group’s system of risk management and PRINCIPLE C: internal control are contained in the Statement on Risk Management INTEGRITY IN CORPORATE REPORTING AND & Internal Control and the Audit Committee Report as set out in MEANINGFUL RELATIONSHIP WITH this Annual Report. STAKEHOLDERS

Communication with Shareholders Internal Audit The YTL Corp Group values dialogue with investors and constantly YTL Corp’s internal audit function is undertaken by its Internal strives to improve transparency by maintaining channels of Audit department (“YTLIA”), which reports directly to the Audit communication with shareholders and investors that enable the Committee. The Head of YTLIA, Mr Choong Hon Chow, is a member Board to convey information about performance, corporate strategy of the Malaysian Institute of Accountants and a fellow member of and other matters affecting stakeholders’ interests. The Board the Association of Chartered Certified Accountants (ACCA) UK. He believes that a constructive and effective investor relationship is started his career with the external audit division of a large public essential in enhancing shareholder value and recognises the accounting firm before moving on to the internal audit profession importance of timely dissemination of information to shareholders. in public listed companies and gained valuable and extensive internal audit experiences covering many areas of diversified commercial Accordingly, the Board ensures that shareholders are kept well- businesses and activities. He has a total of 37 years of internal informed of any major development of the YTL Corp Group. Such and external audit experience. information is communicated through the Annual Report, the various disclosures and announcements to Bursa Securities, including YTLIA comprises 9 full-time personnel. The personnel of YTLIA are quarterly and annual results, and corporate websites. Corporate free from any relationships or conflicts of interest which could information, annual financial results, governance information, impair their objectivity and independence. business reviews and future plans are disseminated through the Annual Report, whilst current corporate developments are

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Corporate Governance Overview Statement for the financial year ended 30 June 2020

communicated via the Company’s corporate website at www.ytl. The Executive Chairman, Managing Director and Executive Directors com and the YTL Corp Group’s community website at www. take the opportunity to present a comprehensive review of the ytlcommunity.com, in addition to prescribed information, including progress and performance of the YTL Corp Group and provide its interim financial results, announcements, circulars, prospectuses appropriate answers in response to shareholders’ questions during and notices, which is released through the official website of Bursa the meeting, thereby ensuring a high level of accountability, Securities. transparency and identification with the YTL Corp Group’s business operations, strategy and goals. The Directors are mindful of the The Executive Chairman, Managing Director and the Executive recommendation under the Code that all directors must attend Directors meet with analysts, institutional shareholders and investors general meetings and fully appreciate the need for their attendance throughout the year not only to promote the dissemination of the at all such meetings. YTL Corp Group’s financial results but to provide updates on strategies and new developments to ensure better understanding Extraordinary general meetings are held as and when required to of the YTL Corp Group’s operations and activities. Presentations seek shareholders’ approval. The Executive Chairman, Managing based on permissible disclosures are made to explain the YTL Corp Director and Executive Directors take the opportunity to fully Group’s performance and major development programs. explain the rationale for proposals put forth for approval and the implications of such proposals for the Company and to reply to Whilst efforts are made to provide as much information as possible shareholders’ questions. to its shareholders and stakeholders, the Directors are cognisant of the legal and regulatory framework governing the release of Where applicable, each item of special business included in the material and sensitive information so as to not mislead its notice of the meeting is accompanied by an explanatory statement shareholders. Therefore, the information that is price-sensitive or for the proposed resolution to facilitate full understanding and that may be regarded as undisclosed material information about evaluation of the issues involved. All resolutions are put to vote the YTL Corp Group is not disclosed to any party until after the by electronic poll voting and an independent scrutineer is appointed prescribed announcement to Bursa Securities has been made. to verify poll results. The results of the electronic poll voting are announced in a timely manner, usually within half an hour of the Conduct of General Meetings voting process to enable sufficient time for the results to be tabulated and verified by the independent scrutineer. The AGM is the principal forum for dialogue with shareholders. The Board provides opportunities for shareholders to raise questions In view of the ongoing COVID-19 pandemic, the forthcoming 37th pertaining to issues in the Annual Report, corporate developments AGM will be held on a fully virtual basis, the details of which can in the YTL Corp Group, the resolutions being proposed and the be found in the Notice of Annual General Meeting in this Annual business of the YTL Corp Group in general at every general meeting Report. of the Company.

The rights of shareholders, including the right to demand a poll, The Notice of the AGM and a circular to shareholders in relation are found in the Constitution of the Company. At the 36th AGM of to the renewal of the Company’s share buy-back and recurrent the Company, held on 12 December 2019, the resolutions put forth related party transactions mandates, if applicable, are sent to for shareholders’ approval were voted on by way of a poll. shareholders at least 28 days prior to the AGM in accordance with the Code, which also meets the criteria of the Listing Requirements and Companies Act 2016, which require the Notice of AGM to be This statement and the CG Report were approved by the Board of sent 21 days prior to the AGM. This provides shareholders with Directors on 30 September 2020. sufficient time to review the YTL Corp Group’s financial and operational performance for the financial year and to fully evaluate new resolutions being proposed to make informed voting decisions at the AGM.

68 ANNUAL REPORT 2020

Statement on Risk Management & Internal Control for the financial year ended 30 June 2020

During the financial year under review, YTL Corporation Berhad PRINCIPAL FEATURES OF THE YTL CORP (“YTL Corp” or “Company”) and its subsidiaries (“YTL Corp Group”) GROUP’S SYSTEM OF INTERNAL CONTROL continued to enhance the YTL Corp Group’s system of internal control and risk management, to comply with the applicable The Board is committed to maintaining a sound internal control provisions of the Main Market Listing Requirements (“Listing structure that includes processes for continuous monitoring and Requirements”) of Bursa Malaysia Securities Berhad (“Bursa review of effectiveness of control activities, and to govern the Securities”) and the principles and practices of the Malaysian Code manner in which the YTL Corp Group and its staff conduct themselves. on Corporate Governance (“Code”). The principal features which formed part of the YTL Corp Group’s system of internal control can be summarised as follows:- The Board acknowledges its overall responsibility for maintaining a sound system of risk management and internal control to safeguard • Authorisation Procedures: The YTL Corp Group has a clear the investment of its shareholders and the assets of the YTL Corp definition of authorisation procedures and a clear line of Group, and that these controls are designed to provide reasonable, accountability, with strict authorisation, approval and control but not absolute, assurance against the risk of occurrence of procedures within the Board and the senior management. material errors, fraud or losses. Responsibility levels are communicated throughout the YTL Corp Group which set out, among others, authorisation levels, segregation of duties and other control procedures to promote RESPONSIBILITIES OF THE BOARD effective and independent stewardship in the best interests of shareholders. The Board is ultimately responsible for maintaining a sound system of risk management and internal control which includes the • Authority Levels: The YTL Corp Group has delegated authority establishment of an appropriate control environment framework levels for major tenders, capital expenditure projects, acquisitions to address the need to safeguard shareholders’ investments and and disposals of businesses and other significant transactions the assets of the YTL Corp Group, and for reviewing the adequacy to the Executive Chairman/Managing Directors/Executive and integrity of the system. The system of internal control covers Directors. The approval of capital and revenue proposals above not only financial controls but operational and compliance controls certain limits is reserved for decision by the Board. Other and risk management. However, the Board recognises that reviewing investment decisions are delegated for approval in accordance the YTL Corp Group’s system of risk management and internal with authority limits. Comprehensive appraisal and monitoring control is a concerted and continuing process, designed to minimise procedures are applied to all major investment decisions. the likelihood of fraud and error, and to manage rather than eliminate the risk of failure to achieve business objectives. The authority of the Directors is required for decisions on key Accordingly, the system of risk management and internal control treasury matters including financing of corporate and investment can only provide reasonable but not absolute assurance against funding requirements, foreign currency and interest rate risk material misstatement, fraud and loss. management, investments, insurance and designation of authorised signatories. The Board believes that the YTL Corp Group’s system of risk management and internal control, financial or otherwise in place • Financial Performance: Interim financial results are reviewed for the financial year under review, should provide reasonable by the Audit Committee and approved by the Board upon assurance regarding the achievement of the objectives of ensuring recommendation of the Audit Committee before release to effectiveness and efficiency of operations, reliability and transparency Bursa Securities. The full year financial results and analyses of of financial information and compliance with laws and regulations. the YTL Corp Group’s state of affairs are disclosed to shareholders after review and audit by the external auditors.

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Statement on Risk Management & Internal Control for the financial year ended 30 June 2020

• Internal Compliance: The YTL Corp Group monitors compliance YTLIA operates independently of the work it audits and provides with its internal financial controls through management reviews periodic reports to the Audit Committee, reporting on the and reports which are internally reviewed by key personnel to outcome of the audits conducted which highlight the enable it to gauge achievement of annual targets. Updates of effectiveness of the system of internal control and significant internal policies and procedures are undertaken to reflect risks. The Audit Committee reviews and evaluates the key changing risks or resolve operational deficiencies, as well as concerns and issues raised by YTLIA and ensures that appropriate changes to legal and regulatory compliance requirements and prompt remedial action is taken by management. relevant to the YTL Corp Group. Internal audit visits are systematically arranged over specific periods to monitor and None of the weaknesses or issues identified during the review scrutinise compliance with procedures and assess the integrity for the financial year has resulted in non-compliance with any of financial information provided. relevant policies or procedures, listing requirements or recommended industry practices that would require disclosure in the Company’s Annual Report. KEY PROCESSES OF THE YTL CORP GROUP’S SYSTEM OF INTERNAL CONTROL The companies of the Wessex Water Limited group (“Wessex Water”) based in the United Kingdom (“UK”) were not covered The key processes that the Board has established to review the by the internal audit process discussed above. Wessex Water’s adequacy and integrity of the system of internal control are as operations are subject to stringent financial and operational follows:- controls imposed by its regulator, the UK Water Services Regulation Authority (known as Ofwat), a government body, and by its • Internal Audit Function: The YTL Corp Group’s internal audit regulatory licence. Wessex Water Services Limited (“WWSL”) function is carried out by its Internal Audit department (“YTLIA”), possesses its own internal audit department. The internal audit which provides assurance on the efficiency and effectiveness department reports to WWSL’s audit committee, which has the of the internal control systems implemented by Management, responsibility to ensure the preservation of good financial and reports directly to the Audit Committee. YTLIA also carries practices and monitor the controls that are in place to ensure out work for YTL Corp’s listed subsidiaries, namely YTL Power the integrity of those practices. It reviews the annual financial International Berhad and Malayan Cement Berhad, and their statements and provides a line of communication between the respective groups of companies, and reports directly to the board of directors and the external auditors. It has formal terms audit committees of those listed subsidiaries on matters of reference which deal with its authorities and duties, and its pertaining to them. findings are presented to the audit committee of the Wessex Water Group’s parent company, YTL Power International Berhad A description of the work of the internal audit function can be (“YTL Power”), a listed subsidiary of YTL Corp. found in the Audit Committee Report, whilst additional details about the personnel and resources of YTLIA are contained in Similarly, the companies of the YTL PowerSeraya Pte Limited the Corporate Governance Overview Statement set out in this group (“YTL PowerSeraya”), which are subsidiaries of YTL Power, Annual Report. This information is also available under the based in Singapore, were also not covered by YTLIA. YTL “Governance” section on the Company’s website at www.ytl. PowerSeraya’s operations are subject to stringent financial and com. operational controls imposed by its regulator, the Energy Market Authority (EMA), a statutory board under the Minister of Trade and Industry of Singapore. YTL PowerSeraya outsourced its internal audit functions to a reputable professional firm which reports to its audit committee, and its findings are also presented to YTL Power’s audit committee. YTL PowerSeraya has the responsibility to ensure that the internal controls and systems in place are maintained to provide reasonable assurance as to the integrity and reliability of its financial statements.

70 ANNUAL REPORT 2020

Statement on Risk Management & Internal Control for the financial year ended 30 June 2020

The system of internal control will continue to be reviewed, characteristics of highly predictable operating costs and revenue enhanced and updated in line with changes in the operating streams, which in turn generate stable and predictable cash flows environment. The Board will seek regular assurance on the and profits, underpinned by an established regulatory environment continuity and effectiveness of the internal control system in their respective markets of operation. through appraisals by YTLIA. The Board is of the view that the current system of internal control in place throughout the YTL The Board acknowledges that all areas of the YTL Corp Group’s Corp Group is effective to safeguard its interests. business activities involve some degree of risk. The YTL Corp Group is committed to ensuring that there is an effective risk management • Executive Board/Senior Management Meetings: The YTL framework which allows management to manage risks within defined Corp Group conducts regular meetings of the executive board/ parameters and standards, and promotes profitability of the YTL senior management which comprise the Executive Chairman/ Corp Group’s operations in order to enhance shareholder value. Managing Directors/Executive Directors and divisional heads/ senior managers. These meetings are convened to deliberate The Board assumes overall responsibility for the YTL Corp Group’s and decide upon urgent company matters and to review, identify, risk management framework. Identifying, evaluating and managing discuss and resolve significant financial and treasury matters and any significant risks faced by the YTL Corp Group is an ongoing to monitor the financial standing of the YTL Corp Group. They process which is undertaken by the senior management at each also serve to ensure that any new financial developments and/ level of operations and by the Audit Committee, which assesses or areas of concern are highlighted early and can be dealt with and analyses these findings and reports to the Board. At the same promptly. Decisions can then be effectively communicated to all time, YTLIA, in the performance of its internal audit function, will relevant staff levels in a timely manner. From these meetings, identify and evaluate any significant risks faced by the YTL Corp the executive board/management is able to identify significant Group and report these findings to the Audit Committee. During operational and financial risks of the business units concerned. the financial year under review, the Board’s functions in the risk management framework were exercised primarily by the Managing • Site Visits: The Managing Directors/Executive Directors Directors/Executive Directors through their participation in undertake visits to production and operating units and property management meetings to ensure the adequacy and integrity of development sites and communicate with various levels of the system of internal control. Emphasis is placed on reviewing and staff to gauge first-hand the effectiveness of strategies updating the process for identifying and evaluating the significant discussed and implemented. This is to ensure that management risks affecting the business, and policies and procedures by which and the respective Managing Directors/Executive Directors these risks are managed. maintain a transparent and open channel of communication for effective operation. The YTL Corp Group’s activities expose it to a variety of financial risks, including market risk (comprising foreign currency exchange risk, interest rate risk and price risk), credit risk, liquidity risk and KEY FEATURES & PROCESSES OF THE YTL CORP capital risk. The YTL Corp Group’s overall financial risk management GROUP’S RISK MANAGEMENT FRAMEWORK objective is to ensure that the YTL Corp Group creates value for its shareholders. The YTL Corp Group focuses on the unpredictability The YTL Corp Group’s strong financial profile is the result of a of financial markets and seeks to minimise potential adverse effects system of internal control and risk management designed to mitigate on its financial performance. Financial risk management is carried risks which arise in the course of business. This is exemplified by out through regular risk review analysis, internal control systems the YTL Corp Group’s strategy of acquiring regulated assets and and adherence to the YTL Corp Group’s financial risk management financing acquisitions on a non-recourse basis. These include YTL policies. The Board regularly reviews these risks and approves the Power’s wholly-owned subsidiaries, Wessex Water and YTL appropriate control environment framework. Further discussion and PowerSeraya, as well as its interests in ElectraNet Pty Ltd, P.T. Jawa details on the YTL Corp Group’s risk management is contained in Power and Attarat Power Company PSC. These assets share common the Management Discussion & Analysis in this Annual Report.

71 YTL CORPORATION BERHAD

Statement on Risk Management & Internal Control for the financial year ended 30 June 2020

Management is responsible for creating a risk-aware culture within CONCLUSION the YTL Corp Group and for the identification and evaluation of significant risks applicable to their areas of business, together with The Board is of the view that the system of risk management and the design and operation of suitable internal controls. These risks internal control being instituted throughout the YTL Corp Group is are assessed on a continual basis and may be associated with a sound and effective. The monitoring, review and reporting variety of internal and external sources including control breakdowns, arrangements in place give reasonable assurance that the structure disruption in information systems, competition, natural catastrophe and operation of controls are appropriate for the YTL Corp Group’s and regulatory requirements. Significant changes in the business operations and that risks are at an acceptable level throughout its and the external environment which affect significant risks will be businesses. The Managing Director is primarily responsible for the reported by the management to the Board in developing a risk financial management of YTL Corp and has provided assurance to mitigation action plan. Where areas for improvement in the system the Board that the YTL Corp Group’s risk management and internal are identified, the Board considers the recommendations made by control system is operating adequately and effectively. Reviews of the Audit Committee and the internal auditors. all the control procedures will be continuously carried out to ensure the ongoing effectiveness and adequacy of the system of risk The Board will pursue its ongoing process of identifying, assessing management and internal control, so as to safeguard shareholders’ and managing key business, operational and financial risks faced by investments and the YTL Corp Group’s assets. its business units as well as regularly reviewing planned strategies to determine whether risks are mitigated and well-managed, and to This statement was approved by the Board of Directors on ensure compliance with the guidelines issued by the relevant 30 September 2020. authorities. This is to ensure the YTL Corp Group is able to respond effectively to the constantly changing business environment in order to protect and enhance stakeholders’ interests and shareholder value.

REVIEW BY EXTERNAL AUDITORS

The external auditors, HLB Ler Lum PLT, have reviewed this Statement on Risk Management & Internal Control for inclusion in the Annual Report for the financial year ended 30 June 2020, in compliance with Paragraph 15.23 of the Listing Requirements, and reported to the Board that nothing has come to their attention that causes them to believe that the statement is inconsistent with their understanding of the process adopted by the Board in reviewing the adequacy and integrity of the system of internal controls.

72 ANNUAL REPORT 2020

Analysis of Shareholdings as at 21 September 2020

Class of shares : Ordinary Shares Voting rights : One vote per shareholder on a show of hands or one vote per ordinary share on a poll

DISTRIBUTION OF SHAREHOLDINGS

No. of No. of Size of holding Shareholders % Shares# %

Less than 100 3,385 9.31 117,698 0.00 100 – 1,000 4,761 13.09 2,479,666 0.02 1,001 – 10,000 17,002 46.75 69,242,263 0.65 10,001 – 100,000 9,510 26.15 279,257,860 2.62 100,001 to less than 5% of issued shares 1,704 4.69 4,974,887,861 46.72 5% and above of issued shares 2 0.01 5,323,870,374 49.99

Total 36,364 100.00 10,649,855,722 100.00

# Excluding 372,906,618 shares bought back and retained by the Company as treasury shares.

THIRTY LARGEST SHAREHOLDERS (without aggregating securities from different securities accounts belonging to the same person)

Name No. of Shares %

1 Yeoh Tiong Lay & Sons Holdings Sdn Bhd 4,704,491,387 44.17 2 Citigroup Nominees (Tempatan) Sdn Bhd 619,378,987 5.82 – Employees Provident Fund Board 3 HSBC Nominees (Asing) Sdn Bhd 491,954,721 4.62 – Credit Suisse (Hong Kong) Limited 4 RHB Capital Nominees (Tempatan) Sdn Bhd 460,000,000 4.32 – Pledged Securities Account for Yeoh Tiong Lay & Sons Holdings Sdn Bhd 5 Amanahraya Trustees Berhad 284,237,844 2.67 – Amanah Saham Bumiputera 6 Jamaican Gold Limited 261,798,317 2.46 7 Tien Shia International Limited 217,078,398 2.04 8 Orchestral Harmony Limited 196,796,355 1.85 9 Steeloak International Limited 183,087,748 1.72 10 Puan Sri Datin Seri Tan Kai Yong @ Tan Kay Neong 137,552,943 1.29 11 Bara Aktif Sdn Bhd 115,217,861 1.08 12 Kerajaan Negeri Pahang 99,716,370 0.94 13 Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 99,427,095 0.93 14 Yeoh Tiong Lay & Sons Holdings Sdn Bhd 93,460,901 0.88 15 HSBC Nominees (Asing) Sdn Bhd 69,851,897 0.66 – JPMCB NA for Vanguard Total International Stock Index Fund 16 HSBC Nominees (Asing) Sdn Bhd 61,498,210 0.58 – JPMCB NA for Vanguard Emerging Markets Stock Index Fund

73 YTL CORPORATION BERHAD

Analysis of Shareholdings as at 21 September 2020

Name No. of Shares %

17 Cartaban Nominees (Asing) Sdn Bhd 57,474,150 0.54 – Exempt An for State Street Bank & Trust Company (West CLT OD67) 18 Dato’ Yeoh Seok Kian 56,621,344 0.53 19 Dato’ Yeoh Soo Keng 55,213,386 0.52 20 RHB Capital Nominees (Tempatan) Sdn Bhd 54,725,584 0.51 – Pledged Securities Account for Hasil Mayang Sdn Bhd 21 Dato’ Yeoh Soo Min 52,833,890 0.50 22 Amanahraya Trustees Berhad 50,047,400 0.47 – Amanah Saham Malaysia 2 – Wawasan 23 Yeoh Tiong Lay & Sons Holdings Sdn Bhd 49,670,371 0.47 24 Cartaban Nominees (Tempatan) Sdn Bhd 48,228,200 0.45 – Pamb for Prulink Equity Fund 25 Citigroup Nominees (Asing) Sdn Bhd 48,157,811 0.45 – CBNY for Dimensional Emerging Markets Value Fund 26 Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 45,584,144 0.43 27 Citigroup Nominees (Asing) Sdn Bhd 38,239,917 0.36 – CBNY for Emerging Market Core Equity Portfolio DFA Investment Dimensions Group INC 28 Maybank Nominees (Tempatan) Sdn Bhd 35,783,232 0.34 – Maybank Trustees Berhad for Public Regular Savings Fund (N14011940100) 29 Citigroup Nominees (Tempatan) Sdn Bhd 31,419,776 0.30 – Employees Provident Fund Board (AFFIN-HWG) 30 Perbadanan Kemajuan Pertanian Negeri Pahang 30,937,625 0.29

Total 8,750,485,864 82.19

SUBSTANTIAL SHAREHOLDERS (as per register of substantial shareholders)

No. of Shares Held

Name Direct % Indirect %

Yeoh Tiong Lay & Sons Holdings Sdn Bhd 5,326,835,800 50.02 – – Yeoh Tiong Lay & Sons Family Holdings Limited – – 5,326,835,800 (1) 50.02 Yeoh Tiong Lay & Sons Trust Company Limited – – 5,326,835,800 (2) 50.02 Puan Sri Datin Seri Tan Kai Yong @ Tan Kay Neong 137,552,943 1.29 5,326,835,800 (3) 50.02 Employees Provident Fund Board 656,735,283 6.17 – –

(1) Deemed interests by virtue of interests held through Yeoh Tiong Lay & Sons Holdings Sdn Bhd pursuant to Section 8 of the Companies Act, 2016.

(2) Deemed interests by virtue of interests held through Yeoh Tiong Lay & Sons Holdings Sdn Bhd pursuant to Section 8 of the Companies Act, 2016 arising from its ownership of 100% of Yeoh Tiong Lay & Sons Family Holdings Limited in its capacity as trustee.

(3) Deemed interests by virtue of interests held through Yeoh Tiong Lay & Sons Holdings Sdn Bhd pursuant to Section 8 of the Companies Act, 2016 arising from her beneficial interest (held through Yeoh Tiong Lay & Sons Trust Company Limited in its capacity as trustee) in Yeoh Tiong Lay & Sons Family Holdings Limited.

74 ANNUAL REPORT 2020

Statement of Directors’ Interests in the Company and Related Corporations as at 21 September 2020

THE COMPANY YTL Corporation Berhad

No. of Shares Held

Name Direct % Indirect %

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 145,011,239 1.36 500,000 (1) * Dato’ Yeoh Seok Kian 56,621,344 0.53 13,447,566 (1) 0.13 Dato’ Yeoh Soo Min 53,421,290 0.50 2,414,960 (1)(2) 0.02 Dato’ Yeoh Seok Hong 52,425,780 0.49 24,020,752 (1) 0.23 Dato’ Sri Michael Yeoh Sock Siong – – 75,092,727 (1)(3) 0.71 Dato’ Yeoh Soo Keng 56,213,386 0.53 773,378 (1) 0.01 Dato’ Mark Yeoh Seok Kah 21,932,775 0.21 4,085,708 (1) 0.04 Syed Abdullah Bin Syed Abd Kadir 9,592,215 0.09 20,034 (1) *

No. of Share Options

Name Direct Indirect

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 17,000,000 12,000,000 (1) Dato’ Yeoh Seok Kian 15,000,000 6,000,000 (1) Dato' Chong Keap Thai @ Cheong Keap Tai 1,000,000 – Dato’ Yeoh Soo Min 15,000,000 2,000,000 (1) Dato’ Yeoh Seok Hong 15,000,000 12,000,000 (1) Dato’ Sri Michael Yeoh Sock Siong 15,000,000 – Dato’ Yeoh Soo Keng 15,000,000 – Dato’ Mark Yeoh Seok Kah 15,000,000 – Syed Abdullah Bin Syed Abd Kadir 2,000,000 –

SUBSIDIARY COMPANIES YTL Power International Berhad

No. of Shares Held

Name Direct % Indirect %

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 20,113,596 0.26 290,780 (1) * Dato’ Yeoh Seok Kian 10,612,987 0.14 12,909,578 (1) 0.17 Dato’ Yeoh Soo Min 17,944,778 0.23 4,687,077 (1)(2) 0.06 Dato’ Yeoh Seok Hong 126,028,219 1.64 5,115,520 (1) 0.07 Dato’ Sri Michael Yeoh Sock Siong – - 17,047,448 (1)(3) 0.22 Dato’ Yeoh Soo Keng 16,039,576 0.21 185,818 (1) * Dato’ Mark Yeoh Seok Kah 11,415,718 0.15 1,443,626 (1) 0.02 Syed Abdullah Bin Syed Abd Kadir 2,429,245 0.03 561 (1) *

75 YTL CORPORATION BERHAD

Statement of Directors’ Interests in the Company and Related Corporations as at 21 September 2020

No. of Share Options

Name Direct Indirect

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 17,000,000 – Dato’ Yeoh Seok Kian 15,000,000 – Dato’ Yeoh Soo Min 13,000,000 – Dato’ Yeoh Seok Hong 10,000,000 4,500,000 (1) Dato’ Sri Michael Yeoh Sock Siong 15,000,000 – Dato’ Yeoh Soo Keng 13,000,000 – Dato’ Mark Yeoh Seok Kah 15,000,000 – Syed Abdullah Bin Syed Abd Kadir 4,000,000 –

Malayan Cement Berhad

No. of Shares Held

Name Direct % Indirect %

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE – – 500,000 (1) 0.06 Dato’ Sri Michael Yeoh Sock Siong – – 2,100 (1) *

YTL Corporation (UK) PLC

No. of Shares Held

Name Direct %

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 1 *

YTL Construction (Thailand) Limited

No. of Shares Held

Name Direct %

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 1 0.01 Dato’ Yeoh Seok Kian 1 0.01 Dato’ Yeoh Seok Hong 1 0.01 Dato’ Sri Michael Yeoh Sock Siong 1 0.01 Dato’ Mark Yeoh Seok Kah 1 0.01

Samui Hotel 2 Co. Ltd

No. of Shares Held

Name Direct %

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 1 * Dato’ Mark Yeoh Seok Kah 1 *

76 ANNUAL REPORT 2020

Statement of Directors’ Interests in the Company and Related Corporations as at 21 September 2020

Related Corporations

Syarikat Pelancongan Seri Andalan (M) Sdn Bhd § (In Members Voluntary Winding-Up)

No. of Shares Held

Name Direct %

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 1 *

* Negligible

§ Commenced winding-up on 22.11.2019

(1) Deemed interests by virtue of interests held by spouse and/or children pursuant to Section 59(11)(c) of the Companies Act, 2016.

(2) Deemed interests by virtue of interests held by Tan & Yeoh Properties Sdn Bhd pursuant to Section 8 of the Companies Act, 2016.

(3) Deemed interests by virtue of interests held by Hasil Mayang Sdn Bhd pursuant to Section 8 of the Companies Act, 2016.

Other than as disclosed above, none of the other Directors held any interest in shares of the company or its related corporations.

77 YTL CORPORATION BERHAD

List of Properties as at 30 June 2020

Approximate Net Book Built up Age of Lease Value as at Description and Area Building Expiry 30 June 2020 Date of Location Tenure Land Area Existing Use (sq.m.) (years) Date (RM'000) Acquisition

Lot 1 in Deposited Plan 804285 Freehold 3,084 sq.m. 33-storey hotel building with 47,276 31 – 1,305,129 29.11.2012 in the Local Government Area of central atrium comprising Sydney, Parish of St James, 595 rooms including 3 levels County of Cumberland^ of basement with car parking bays

3 Orchard Boulevard, 3 Orchard Freehold 1.427 acres 45 units of residences at 10,208 – – 1,143,395 22.11.2007 By-the-Park, Singapore, 248653 3 Orchard By-The-Park

Filton Airfield, Filton, Bristol Freehold 1,416,400 sq.m. Disused Airfield & Hangars – – – 559,644 1.12.2015

Grant No. 28678/M1/B5/1, Freehold 12,338 sq.m. A 5-star hotel with 578 rooms 45,834 23 – 523,000 16.12.2005 within Parcel No. 1, Storey located on part of an 8-level No. B5 of Building No. M1 and podium block and the entire 8 accessory parcels for Lot 24-level tower block of a No. 1267 Section 67, Town and shopping centre together with District of Kuala Lumpur, car park bays located partially State of Wilayah Persekutuan at basement 1 and 4 and the Kuala Lumpur @ entire basement 2, 3 and 5

Avonmouth WRC, Kings Weston Freehold 394,600 sq.m. Water Recycling Centre – – – 418,128 21.5.2002 Lane, Avonmouth, Bristol BS11 OYS

HS (D) 460/88 PT 1122# Leasehold 59.79 acres Cement plant – – Year 2087 400,411 30.7.1998

HS (D) 461/88 PT 1123# Leasehold 0.9864 acres Cement plant – – Year 2087 30.7.1988

HS (D) 2675 PT 1327# Leasehold 22.21 acres Cement plant – – Year 2095 17.4.1996

HS (D) 3705 PT 1417# Leasehold 1.46 acres Warehouse & depot – – Year 2096 29.12.1997

HS (D) 3706 PT 1418# Leasehold 14.55 acres Cement plant – – Year 2096 29.12.1997

HS (D) 2676 PT 1328# Leasehold 8.20 acres Cement plant – – Year 2095 17.4.1996

HS (D) 2677 PT 1329# Leasehold 30.25 acres Cement plant – – Year 2095 17.4.1996

HS (D) 2678 PT 1330# Leasehold 102.33 acres Cement plant – – Year 2095 17.4.1996

HS (D) 2679 PT 1331# Leasehold 130.97 acres Cement plant – – Year 2026 17.4.1996

HS (D) 2680 PT 1332# Leasehold 14.41 acres Cement plant – – Year 2026 17.4.1996

HS (D) 2735 PT 1326# Leasehold 28.24 acres Staff quarter building – – Year 2095 29.5.1996

HS (D) 2737 PT 417# Leasehold 28.17 acres Cement plant – – Year 2095 27.6.1996

HS (D) 2681 PT 1333# Leasehold 278.24 acres Cement plant – – Year 2026 17.4.1996

78 ANNUAL REPORT 2020

List of Properties as at 30 June 2020

Approximate Net Book Built up Age of Lease Value as at Description and Area Building Expiry 30 June 2020 Date of Location Tenure Land Area Existing Use (sq.m.) (years) Date (RM'000) Acquisition

HS (D) 4170 PT 1419# Leasehold 30.06 acres Cement plant – – Year 2097 15.9.1998

HS (D) 4171 PT 1420# Leasehold 3.54 acres Cement plant – – Year 2097 15.9.1998

HS (D) 8804 PT 1421# Leasehold 13.38 acres Cement plant – – Year 2102 1.10.2003

PN 00108181, Lot 2764# Leasehold 49.57 acres Cement plant – – Year 2886 1.11.1996

Geran 23849 Lot 74 Section 59, Registered 13,219 sq.m. A 5-star hotel comprising 57,722 Majestic Wing: 11.5.2091 390,000 3.11.2017 City and District of Kuala lease Majestic Wing (original historic 88 (refurbished Lumpur, State of Wilayah hotel building) comprising in Year 2012) @ Persekutuan Kuala Lumpur 2-storey, 4-storey and Tower Wing: 7 5-storey buildings with 47 rooms and 15-storey Tower Wing with 253 rooms and 3 levels of basement car park

Lot 534 (Grant No. 30470) & Freehold 0.75 acre 42-storey office building – – – 373,000 25.1.2008 Lot 535 (Grant No. 27127) known as Menara YTL Bandar Kuala Lumpur, Daerah Kuala Lumpur

Grant No. 26579 for Lot No. 225, Freehold 1,596.206 sq.m. 22-storey 5-star hotel building 31,613.31 23 – 360,000 15.11.2011 Section 67, Town and District of comprising 251 rooms with Kuala Lumpur, State of Wilayah 4-storey basement car parks Persekutuan Kuala Lumpur@

Lot No. 919-15, 919-18, 919-19, Freehold 19,015 sq.m. 16-storey hotel building with 35,481.33 26 – 288,035 22.12.2011 920-4, 920-5 and 920-7, 1-storey of basement Aza-Soga, Niseko-cho, comprising 506 rooms Abuta-gun; and Lot No. 214-6, 252-2 and 264-4 Aza-Kabayama, Kutchan-cho, Abuta-gun, Hokkaido, Japan ^

^ Based on valuation on 30 April 2020 @ Based on valuation on 31 May 2020 # Mukim Kampung Buaya, Daerah Kuala Kangsar, Negeri Perak Darul Ridzuan

79 FINANCIAL STATEMENTS

81 Directors’ Report 91 Statement by Directors 91 Statutory Declaration 92 Independent Auditors’ Report 100 Income Statements 101 Statements of Comprehensive Income 102 Statements of Financial Position 104 Statements of Changes in Equity 106 Statements of Cash Flows 110 Notes to the Financial Statements ANNUAL REPORT 2020

Directors’ Report

The Directors have pleasure in submitting their report together with the audited financial statements of the Group and of the Company for the financial year ended 30 June 2020.

PRINCIPAL ACTIVITIES

The principal activities of the Company are those of an investment holding and management company.

The principal activities of the subsidiaries are set out in Note 15 to the financial statements.

There have been no significant changes in the nature of these activities during the financial year.

FINANCIAL RESULTS

Group Company RM’000 RM’000

Profit for the year 4,658 169,593

Attributable to: Owners of the parent (189,221) 169,593 Non-controlling interests 193,879 –

4,658 169,593

DIVIDENDS

The amount of dividend paid since the end of the last financial year was as follows:

RM’000

In respect of the financial year ended 30 June 2019: Interim dividend of 4 sen per ordinary share paid on 13 November 2019 426,770

On 28 August 2020, a Share Dividend of one (1) treasury share for every thirty (30) existing ordinary shares held was declared and the book closure date for the Share Dividend is 28 October 2020.

The Board of Directors does not recommend the payment of a final dividend for the financial year ended 30 June 2020.

RESERVES AND PROVISIONS

All material transfers to or from reserves and provisions during the financial year are shown in the financial statements.

81 YTL CORPORATION BERHAD

Directors’ Report

ISSUE OF SHARES

During the financial year, the Company increased its issued and paid-up ordinary share capital by way of:

– issuance of 100,546,311 and 11,656,600 ordinary shares in exchange for YTL Land & Development Berhad’s (“YTL L&D”) ordinary shares and ICULS at an issue price of RM1.14 and RM1.10 per share, pursuant to the unconditional share exchange offer to acquire all the remaining securities in YTL L&D not already held by the Company.

The new ordinary shares rank pari passu in all respects with the existing ordinary shares of the Company.

TREASURY SHARES

The shareholders of the Company granted a mandate to the Company to repurchase its own shares at the Annual General Meeting held on 12 December 2019. The Directors of the Company are committed to enhance the value of the Company to its shareholders and believe that the repurchase plan can be applied in the best interest of the Company and its shareholders.

Details of treasury shares are set out in Note 27(a) to the financial statements.

EMPLOYEES’ SHARE OPTION SCHEME

The Employees’ Share Option Scheme (“ESOS”) for employees and Executive Directors of the Company and its subsidiaries who meet the criteria of eligibility for participation is governed by the by-laws approved by the shareholder at an Extraordinary General Meeting (“EGM”) held on 30 November 2010. The scheme was implemented on 1 April 2011. The salient features and terms of the ESOS are set out in Note 27(b) to the financial statements.

The aggregate maximum allocation of the share options granted to key management personnel must not be more than fifty per cent (50%) of the fifteen per cent (15%) of the net paid up shares capital of the Company at the point of time throughout the duration of the scheme.

The actual allocation granted to key management personnel is as follows:

Actual Allocation

Since Financial Year 1.4.2011 30.6.2020

Key management personnel 13.06%* –

* Computed based on 15% of the net paid up share capital of the Company.

Since the date of the last report, no options have been granted under the ESOS.

82 ANNUAL REPORT 2020

Directors’ Report

EMPLOYEES’ SHARE OPTION SCHEME (CONT’D.)

Details of options granted to Non-Executive Director of the Company is as follows:

Number of share options over ordinary shares

Balance at Balance at The Company 1.7.2019 Granted Exercised 30.6.2020

Name of Director Dato’ Chong Keap Thai @ Cheong Keap Tai 1,000,000 – – 1,000,000

DIRECTORS

The Directors who served on the Board of the Company during the financial year until the date of this report are:

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE Dato’ Yeoh Seok Kian Dato’ Chong Keap Thai @ Cheong Keap Tai Dato’ Ahmad Fuaad Bin Mohd Dahalan Dato’ Yeoh Soo Min Dato’ Yeoh Seok Hong Dato’ Sri Michael Yeoh Sock Siong Dato’ Yeoh Soo Keng Dato’ Mark Yeoh Seok Kah Syed Abdullah Bin Syed Abd. Kadir Faiz Bin Ishak Raja Noorma Binti Raja Othman

The names of directors of the subsidiaries are not disclosed in this Report as a relief order under Section 255(1) of the Companies Act, 2016 (the “Act”) has been granted by the Companies Commission of Malaysia relieving the Directors of the Company from full compliance with the requirements of Section 253(2) of the Act. The names of these directors are set out in the respective subsidiaries’ financial statements, where applicable.

83 YTL CORPORATION BERHAD

Directors’ Report

DIRECTORS’ INTERESTS

The following Directors of the Company who held office at the end of the financial year had, according to the register required to be kept under Section 59 of the Companies Act 2016, interests in the shares of the Company and related companies as follows:

Number of ordinary shares

Balance at Balance at The Company 1.7.2019 Acquired Disposed 30.6.2020

Direct interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 142,661,239 2,350,000 – 145,011,239 Dato’ Yeoh Seok Kian 56,591,526 29,818 – 56,621,344 Dato’ Yeoh Soo Min 52,833,890 587,400 – 53,421,290 Dato’ Yeoh Seok Hong 52,425,780 – – 52,425,780 Dato’ Yeoh Soo Keng 56,194,966 48,420 – 56,243,386 Dato’ Mark Yeoh Seok Kah 20,482,215 1,450,000 – 21,932,215 Syed Abdullah Bin Syed Abd. Kadir 9,592,215 – – 9,592,215

Deemed interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE – 500,000 – 500,000 (1) Dato’ Yeoh Seok Kian 13,447,566 (1) – – 13,447,566 (1) Dato’ Yeoh Soo Min 1,914,408 (1)(2) 500,552 – 2,414,960 (1)(2) Dato’ Yeoh Seok Hong 24,020,752 (1) – – 24,020,752 (1) Dato’ Sri Michael Yeoh Sock Siong 75,092,727 (1)(3) – – 75,092,727 (1)(3) Dato’ Yeoh Soo Keng 773,378 (1) – – 773,378 (1) Dato’ Mark Yeoh Seok Kah 4,085,708 (1) – – 4,085,708 (1) Syed Abdullah Bin Syed Abd. Kadir 20,034 (1) – – 20,034 (1)

Number of share options over ordinary shares

Balance at Balance at The Company 1.7.2019 Granted Exercised 30.6.2020

Direct interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 17,000,000 – – 17,000,000 Dato’ Yeoh Seok Kian 15,000,000 – – 15,000,000 Dato’ Chong Keap Thai @ Cheong Keap Tai 1,000,000 – – 1,000,000 Dato’ Yeoh Soo Min 15,000,000 – – 15,000,000 Dato’ Yeoh Seok Hong 15,000,000 – – 15,000,000 Dato’ Sri Michael Yeoh Sock Siong 15,000,000 – – 15,000,000 Dato’ Yeoh Soo Keng 15,000,000 – – 15,000,000 Dato’ Mark Yeoh Seok Kah 15,000,000 – – 15,000,000 Syed Abdullah Bin Syed Abd. Kadir 2,000,000 – – 2,000,000

84 ANNUAL REPORT 2020

Directors’ Report

DIRECTORS’ INTERESTS (CONT’D.)

Number of share options over ordinary shares

Balance at Balance at The Company 1.7.2019 Granted Exercised 30.6.2020

Deemed interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 12,000,000 (1) – – 12,000,000 (1) Dato’ Yeoh Seok Kian 6,000,000 (1) – – 6,000,000 (1) Dato’ Yeoh Soo Min 2,000,000 (1) – – 2,000,000 (1) Dato’ Yeoh Seok Hong 12,000,000 (1) – – 12,000,000 (1)

Number of ordinary shares

Subsidiary Balance at Balance at – Malayan Cement Berhad 1.7.2019 Acquired Disposed 30.6.2020

Deemed interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE – 500,000 – 500,000 (1) Dato’ Sri Michael Yeoh Sock Siong 2,100 (1) – – 2,100 (1)

Number of ordinary shares

Subsidiary Balance at Balance at – YTL Power International Berhad 1.7.2019 Acquired Disposed 30.6.2020

Direct interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 20,013,596 100,000 – 20,113,596 Dato’ Yeoh Seok Kian 10,612,987 – – 10,612,987 Dato’ Yeoh Soo Min 17,199,678 745,100 – 17,944,778 Dato’ Yeoh Seok Hong 102,945,219 23,083,000 – 126,028,219 Dato’ Yeoh Soo Keng 15,939,576 100,000 – 16,039,576 Dato’ Mark Yeoh Seok Kah 9,575,718 1,740,000 – 11,315,718 Syed Abdullah Bin Syed Abd. Kadir 2,429,245 – – 2,429,245

85 YTL CORPORATION BERHAD

Directors’ Report

DIRECTORS’ INTERESTS (CONT’D.)

Number of ordinary shares

Subsidiary Balance at Balance at – YTL Power International Berhad 1.7.2019 Acquired Disposed 30.6.2020

Deemed interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 90,780 (1) 200,000 – 290,780 (1) Dato’ Yeoh Seok Kian 9,409,578 (1) 3,500,000 – 12,909,578 (1) Dato’ Yeoh Soo Min 3,829,577 (1)(2) 857,500 – 4,687,077 (1)(2) Dato’ Yeoh Seok Hong 5,115,520 (1) – – 5,115,520 (1) Dato’ Sri Michael Yeoh Sock Siong 17,047,448 (1)(3) – – 17,047,448 (1)(3) Dato’ Yeoh Soo Keng 185,818 (1) – – 185,818 (1) Dato’ Mark Yeoh Seok Kah 1,443,626 (1) – – 1,443,626 (1) Syed Abdullah Bin Syed Abd. Kadir 561 (1) – – 561 (1)

Number of share options over ordinary shares

Subsidiary Balance at Balance at – YTL Power International Berhad 1.7.2019 Granted Exercised 30.6.2020

Direct interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 17,000,000 – – 17,000,000 Dato’ Yeoh Seok Kian 15,000,000 – – 15,000,000 Dato’ Yeoh Soo Min 13,000,000 – – 13,000,000 Dato’ Yeoh Seok Hong 10,000,000 – – 10,000,000 Dato’ Sri Michael Yeoh Sock Siong 15,000,000 – – 15,000,000 Dato’ Yeoh Soo Keng 13,000,000 – – 13,000,000 Dato’ Mark Yeoh Seok Kah 15,000,000 – – 15,000,000 Syed Abdullah Bin Syed Abd. Kadir 4,000,000 – – 4,000,000

Deemed interests Dato’ Yeoh Seok Hong 4,500,000 (1) – – 4,500,000 (1)

86 ANNUAL REPORT 2020

Directors’ Report

DIRECTORS’ INTERESTS (CONT’D.)

Number of ordinary shares

Subsidiary Balance at Balance at – YTL Land & Development Berhad Ω 1.7.2019 Acquired Disposed 30.6.2020

Direct interests Dato’ Yeoh Seok Kian 61,538 – (61,538) – Dato’ Yeoh Soo Keng 100,000 – (100,000) –

Deemed interests Dato’ Yeoh Soo Min 625,582 (2) – (625,582) –

Number of Irredeemable Convertible Unsecured Loan Stocks 2011/2021

Balance at Converted/ Balance at 1.7.2019 Acquired Disposed 30.6.2020

Direct interests Dato’ Yeoh Seok Kian 37,000 – (37,000) – Dato’ Yeoh Soo Keng 60,000 – (60,000) –

Ω Securities removed from the Official List of Bursa Malaysia Securities Berhad on 21.10.2019.

Number of ordinary shares of £0.25 each

Subsidiary Balance at Balance at – YTL Corporation (UK) PLC* 1.7.2019 Acquired Disposed 30.6.2020

Direct interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 1 – – 1

* Incorporated in England & Wales

Number of ordinary shares of THB100 each

Subsidiary Balance at Balance at – YTL Construction (Thailand) Limited+ 1.7.2019 Acquired Disposed 30.6.2020

Direct interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 1 - - 1 Dato’ Yeoh Seok Kian 1 - - 1 Dato’ Yeoh Seok Hong 1 - - 1 Dato’ Sri Michael Yeoh Sock Siong 1 - - 1 Dato’ Mark Yeoh Seok Kah 1 - - 1

+ Incorporated in Thailand

87 YTL CORPORATION BERHAD

Directors’ Report

DIRECTORS’ INTERESTS (CONT’D.)

Number of ordinary shares of THB10 each

Subsidiary Balance at Balance at – Samui Hotel 2 Co., Ltd + 1.7.2019 Acquired Disposed 30.6.2020

Direct interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 1 – – 1 Dato’ Mark Yeoh Seok Kah 1 – – 1

+ Incorporated in Thailand

Number of ordinary shares

Related company – Syarikat Pelanchongan Seri Andalan (M) Balance at Balance at Sdn. Bhd. (In Members Voluntary Winding-up)@ 1.7.2019 Acquired Disposed 30.6.2020

Direct interests Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 1 – – 1

@ Commenced winding-up on 22.11.2019

(1) Deemed interests by virtue of interests held by spouse and/or children pursuant to Section 59(11)(c) of the Companies Act 2016. (2) Deemed interests by virtue of interests held by Tan & Yeoh Properties Sdn. Bhd. pursuant to Section 8 of the Companies Act 2016. (3) Deemed interests by virtue of interests held by Hasil Mayang Sdn. Bhd. pursuant to Section 8 of the Companies Act 2016.

Other than as disclosed above, Directors who held office at the end of the financial year did not have interests in the shares of the Company or related companies during the financial year.

INDEMNITY AND INSURANCE FOR DIRECTORS AND OFFICERS

The Company maintains a Directors’ and officers’ liability insurance in respect of any legal action taken against the Directors and officers in the discharge of their duties while holding office for the Group and of the Company. The total amount of insurance premium effected for any Director and officer of the Company as at the financial year ended was RM351,000 (2019: RM344,000). The Directors and officers shall not be indemnified by such insurance for any deliberate negligence, fraud, intentional breach of law or breach of trust proven against them.

DIRECTORS’ BENEFITS

During and at the end of the financial year, no arrangement subsisted to which the Company is a party, with the object or objects of enabling Directors of the Company to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate, other than those arising from the share options granted pursuant to the ESOS.

88 ANNUAL REPORT 2020

Directors’ Report

DIRECTORS’ BENEFITS (CONT’D.)

Since the end of the previous financial year, no directors has received or become entitled to receive any benefit (other than benefits included in the aggregate amount of remuneration received or due and receivable by the Directors as shown in Note 7 to the financial statements of the Group and of the Company) by reason of contract made by the Company or a related corporation with the Director or with a firm of which he/she is a member, or with a company in which he/she has a substantial financial interest.

STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS

Before the financial statements of the Group and of the Company were made out, the Directors took reasonable steps:

(a) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of allowance for doubtful debts and satisfied themselves that all known bad debts had been written off and that adequate allowance had been made for doubtful debts; and

(b) to ensure that any current assets which were unlikely to realise their values as shown in the accounting records of the Group and of the Company in the ordinary course of business had been written down to an amount which they might be expected so to realise.

At the date of this report, the Directors are not aware of any circumstances:

(a) which would render the amount written off for bad debts or the amount of the allowance for doubtful debts in the financial statements of the Group and of the Company inadequate to any substantial extent; or

(b) which would render the values attributed to current assets in the financial statements of the Group and of the Company misleading; or

(c) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate.

At the date of this report, there does not exist:-

(a) any charge on the assets of the Group and of the Company which has arisen since the end of the financial year which secures the liability of any other person; or

(b) any contingent liability of the Group and of the Company which has arisen since the end of the financial year.

No contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve months after the end of the financial year which, in the opinion of the Directors, will or may affect the ability of the Group and of the Company to meet their obligations as and when they fall due.

89 YTL CORPORATION BERHAD

Directors’ Report

OTHER STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS

The Directors state that:

At the date of this Report, they are not aware of any circumstances not otherwise dealt with in this Report or the financial statements of the Group and of the Company which would render any amount stated in the respective financial statements misleading.

In their opinion,

(a) the results of the operations of the Group and of the Company during the financial year were not substantially affected by any item, transaction or event of a material and unusual nature except as disclosed in Note 45 to the financial statements; and

(b) except as disclosed in Note 45 to the financial statements, there has not arisen in the interval between the end of the financial year and the date of this Report any item, transaction or event of a material and unusual nature likely to affect substantially the results of the operations of the Group and of the Company for the financial year in which this Report is made.

ULTIMATE HOLDING COMPANY

The Directors regard Yeoh Tiong Lay & Sons Family Holdings Limited, a Company incorporated in Jersey, as the Company’s ultimate holding company.

SUBSIDIARIES

The details of the Company’s subsidiaries are disclosed in Note 15 to the financial statements.

AUDITORS

The auditors, HLB Ler Lum PLT, have expressed their willingness to continue in office.

The auditors’ remuneration is disclosed in Note 7 to the financial statements.

Signed on behalf of the Board in accordance with a resolution of the Directors.

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE

Dato’ Yeoh Seok Kian

30 September 2020 Kuala Lumpur

90 ANNUAL REPORT 2020

Statement by Directors pursuant to Section 251(2) of the Companies Act, 2016

We, Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE and Dato’ Yeoh Seok Kian, being two of the Directors of YTL Corporation Berhad, do hereby state that, in the opinion of the Directors, the accompanying financial statements are drawn up in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act, 2016 in Malaysia so as to give a true and fair view of the financial position of the Group and the Company as at 30 June 2020 and of their financial performance and cash flows for the year then ended.

Signed on behalf of the Board in accordance with a resolution of the Directors dated 30 September 2020.

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE

Dato’ Yeoh Seok Kian

Statutory Declaration pursuant to Section 251(1) of the Companies Act, 2016

I, Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE, being the Director primarily responsible for the financial management of YTL Corporation Berhad, do solemnly and sincerely declare that to the best of my knowledge and belief the accompanying financial statements are correct, and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960.

Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE

Subscribed and solemnly declared by the abovenamed Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE at Kuala Lumpur on 30 September 2020.

Before me,

Tan Seok Kett Commissioner for Oaths

91 YTL CORPORATION BERHAD

Independent Auditors’ Report to the Members of YTL Corporation Berhad

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS

Opinion

We have audited the financial statements of YTL Corporation Berhad, which comprise the Statements of Financial Position as at 30 June 2020 of the Group and of the Company, and the Income Statements, Statements of Comprehensive Income, Statements of Changes in Equity and Statements of Cash Flows of the Group and of the Company for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, as set out on pages 100 to 302.

In our opinion, the accompanying financial statements give a true and fair view of the financial position of the Group and of the Company as at 30 June 2020, and of their financial performance and their cash flows for the year then ended in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia.

Basis for Opinion

We conducted our audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence and Other Ethical Responsibilities

We are independent of the Group and of the Company in accordance with the By-Laws (on Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants (“By-Laws”) and the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (“IESBA Code”), and we have fulfilled our other ethical responsibilities in accordance with the By-Laws and the IESBA Code.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the Group and of the Company for the current year. These matters were addressed in the context of our audit of the financial statements of the Group and of the Company as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

1. Impairment assessment of goodwill

The risk

We refer to Note 3 and 19 to the Financial Statements respectively.

As at 30 June 2020, goodwill arising on consolidation amounted to RM8,118 million which represents 11.6% of the Group’s total assets. The goodwill is primarily allocated to the multi utilities business in Singapore, water and sewerage business in the United Kingdom and cement manufacturing business in Malaysia. The goodwill for these businesses comprises 92.7% of total goodwill.

The recoverable amounts of the cash generating units (“CGU”) are determined based on VIU calculation. The key assumptions and sensitivities are disclosed in Note 19(a) and 19(b) to the Financial Statements respectively.

We focused on this area as the estimation of the recoverable amount is inherently uncertain and requires significant judgement on the future cash flows, terminal growth rate and the discount rate applied to the projected cash flows.

92 ANNUAL REPORT 2020

Independent Auditors’ Report to the Members of YTL Corporation Berhad

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONT’D.)

Key Audit Matters (cont’d.)

1. Impairment assessment of goodwill (cont’d.)

Our response:

Ours and component auditors audit procedures included the following:

• agreed the value-in-use (“VIU”) cash flows of CGU to the financial budgets approved by the Directors;

• discussed with management the key assumptions used in the respective VIU cash flows and compared the revenue growth rates to the historical performance of the respective CGUs and assessed the potential impact of Covid-19 outbreak of the VIU cash flows;

• checked the reasonableness of the discount rates and terminal growth rates with the assistance of valuation expert by benchmarking to the respective industries which included the impact of Covid-19 outbreak as at year end;

• checked the sensitivity analysis performed by management over discount rates, terminal growth rates, and revenue growth rates, used in deriving the respective VIU cash flows; and

• compared historical forecasting for the current financial year to actual results achieved to ascertain the reasonableness of management’s estimates.

2. Impairment assessment of property, plant and equipment (“PPE”) of the mobile broadband network business

The risk

We refer to Note 3 and 11 to the Financial Statements respectively.

The property, plant and equipment of the mobile broadband network business accounts for 8.8% (RM2,688.5 million) of the Group’s property, plant and equipment as at 30 June 2020.

The Group performed an impairment assessment on the carrying values of the PPE due to losses recorded by the segment which is an impairment indicator.

The impairment assessment was performed by management using fair value less costs of disposal (“FVLCD”) cash flows which requires significant judgement as the timing and quantum of the cash flows is dependent on the achievement of the next five years’ business plans and financial budgets which are dependent on the use of key assumptions comprising its growth targets and sourcing contract renewals.

We focused on this area as the estimation of the recoverable amount is inherently uncertain and requires significant judgement on the future cash flows, terminal growth rate and the discount rate applied to the calculation of the FVLCD.

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Independent Auditors’ Report to the Members of YTL Corporation Berhad

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONT’D.)

Key Audit Matters (cont’d.)

2. Impairment assessment of property, plant and equipment (“PPE”) of the mobile broadband network business (cont’d.)

Our response:

Our audit procedures include the following:

• agreed the FVLCD cash flows of the CGU to the financial budgets approved by the Directors, adjusted to reflect market participants assumptions;

• checked the assumptions used, in particular average revenue growth rate and useful life of the assets and benchmarked against the comparable companies within the industry, including assessing the impact of Covid-19 outbreak using industry data;

• discussed with management the rationale applied on the assumption of sourcing contract renewals by considering the Company’s historical experience;

• assessed reasonableness of the discount rate which reflects the specific risk relating to the PPE based on inputs that are publicly available; and

• checked sensitivity analysis performed by management on the discount rate used in deriving the FVLCD.

3. Capitalisation policy on infrastructure assets of the water and sewerage business

The risk

We refer to Note 3 and 11 to the Financial Statements respectively.

The water and sewerage business’s net book value of infrastructure assets comprise 25.9% (RM7,889 million) of the Group’s total property, plant and equipment. The infrastructure assets comprise capital expenditure incurred to meet the development and regulatory requirement of the business, employee and overhead costs that are directly attributable to the construction of the asset.

There is a significant judgement involved in determining whether costs incurred, specifically employee and overhead costs meet the relevant criteria for capitalisation in accordance with MFRS 116, Property, Plant and Equipment (“MFRS 116”).

Our response:

Ours and component auditors’ audit procedures include the following:

• tested the operating effectiveness of the controls over capitalisation and authorisation of selected projects’ infrastructure assets and identification of capital expenditures attributable to the infrastructure assets;

• understood the nature of costs incurred through discussion with management and corroborated with supporting information provided and checked whether the costs incurred met the capitalisation criteria in accordance with MFRS 116; and

• compared the level of employee and overhead costs capitalised against prior year balances and current year budget information to identify material changes in the nature or quantum of costs capitalised, with any significant variances discussed and corroborated with management.

94 ANNUAL REPORT 2020

Independent Auditors’ Report to the Members of YTL Corporation Berhad

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONT’D.)

Key Audit Matters (cont’d.)

4. Assumptions used in determining the present value of the funded defined benefit obligations of the water and sewerage segment

The risk

We refer to Note 3 and 35 to the Financial Statements respectively.

As at 30 June 2020, the water and sewerage business’s post-employment benefit obligations comprise 94.9% (RM869 million) of the Group’s total post-employment benefit obligations.

The present value of the funded defined benefit obligations depends on a number of assumptions determined on an actuarial basis. The key assumptions are disclosed in Note 35 (c) to the financial statements.

We focused on this area due to the key assumptions used in determining the present value of the funded defined benefit obligations and any changes in these assumptions will materially impact the carrying amount of the post-employment benefit obligations.

Our response:

Ours and component auditors’ audit procedures include the following:

• understood and assessed the scope of work by the external actuary engaged by the management;

• assessed the fair value of the scheme assets by obtaining the valuation from the relevant fund managers as at balance sheet date and corroborated with independent sources;

• assessed the competencies, objectivity and capabilities of external actuary;

• obtained the external actuarial report and understood the key assumptions used in determining the present value of the funded defined benefit obligations;

• compared the key assumptions used by the actuary on discount rate, expected rate of increase in pension payment, and price inflation against external market data and similar schemes with assistance of an actuary specialist;

• evaluated the impact of Covid-19 outbreak on the valuation of assets held within the pension scheme;

• compared the expected rate of salary increases used by the actuary against historical trend; and

• checked the disclosures in respect of the sensitivity of the carrying amounts of the post-employment benefit obligations to changes in key assumptions, performed by the actuary.

95 YTL CORPORATION BERHAD

Independent Auditors’ Report to the Members of YTL Corporation Berhad

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONT’D.)

Key Audit Matters (cont’d.)

5. Impairment assessment on trade receivables of the Group’s water and sewerage segment

The risk

We refer to Note 3 and 20 to the Financial Statements respectively.

The trade receivables of the water and sewerage segment accounts for 29.0% (RM448.6 million is net of expected credit losses of RM244.8 million) of the Group’s trade receivables as at 30 June 2020.

As this segment operates in the UK, there is a statutory requirement to continue to provide water to all customers who has defaulted in payment. Therefore, the Group has estimated the expected credit losses of trade receivables on a portfolio basis for the year based on the historical cash collection trends and economic trends, which are subjective in nature.

We focused on this area given the use of significant estimates and judgement in determining the appropriate level of expected credit losses for trade receivables.

Our response:

Ours and component auditors’ audit procedures include the following:

• tested the controls over assessment of impairment of trade receivables and the operating effectiveness of the key IT systems used for generating billings and cash collection data used for the expected credit losses assessment;

• obtained the historical cash collection trends of each ageing bracket of the trade receivables and payment methods and compared against the percentage of expected credit losses used by management against each ageing bracket and payment methods;

• checked the appropriateness of the forward-looking forecasts assumptions used to determine the expected credit losses, which included management’s scenario analysis of the impact of Covid-19 outbreak; and

• compared the level of expected credit losses applied against similar companies within the industry in the UK.

6. Revenue recognition from construction contracts

The risk

Revenue and cost of sales recognised from construction contracts during the financial year as disclosed in Note 3, 4 and 5 to the financial statements is RM2,316 million and RM2,061 million respectively.

The Group has significant long-term construction contracts. The recognition of revenue and profit on these contracts is based on input method (on the basis of the entity’s efforts or inputs to the satisfaction of the performance obligation relative to the total expected inputs to the satisfaction of that performance obligation).

Revenue and profit recognition on long-term construction contract is a key audit matter because of the judgement and estimates exercised by the management based on the assessment of performance obligation, revenue recognition arising from variations to the original contracts, assessment of progress towards complete satisfaction of the performance obligation and contract costs and appropriate of provision for foreseeable losses and liquidated damages.

96 ANNUAL REPORT 2020

Independent Auditors’ Report to the Members of YTL Corporation Berhad

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONT’D.)

Key Audit Matters (cont’d.)

6. Revenue recognition from construction contracts (cont’d.)

Our response:

Our audit procedures include the following:

• reviewed and assessed the forecast budget and appropriateness of assumption used based on historical performance in the Group and industry knowledge, including obtained and assessed information provided by management to determine whether the forecast assumptions are consistent with the terms of the relevant contracts;

• evaluated the management’s updated budget costs and forecast costs to complete by assessing the basis of their calculation;

• recalculated the revenue using approved contract sum, actual costs incurred to date that reflect the progress towards completion of the agreed works to customer and latest revised budgets; and

• inspected the actual costs incurred to the corresponding supporting documents.

INFORMATION OTHER THAN THE FINANCIAL STATEMENTS AND AUDITORS’ REPORT THEREON

The Directors of the Company are responsible for the other information. The other information comprises the information included in the annual report, but does not include the financial statements of the Group and of the Company and our auditors’ report thereon.

Our opinion on the financial statements of the Group and of the Company does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements of the Group and of the Company, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements of the Group and of the Company or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

RESPONSIBILITIES OF THE DIRECTORS FOR THE FINANCIAL STATEMENTS

The Directors of the Company are responsible for the preparation of financial statements of the Group and of the Company that give a true and fair view in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia. The Directors are also responsible for such internal control as the Directors determine is necessary to enable the preparation of financial statements of the Group and of the Company that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements of the Group and of the Company, the Directors are responsible for assessing the Group’s and the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or the Company or to cease operations, or have no realistic alternative but to do so.

97 YTL CORPORATION BERHAD

Independent Auditors’ Report to the Members of YTL Corporation Berhad

AUDITORS’ RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS

Our objectives are to obtain reasonable assurance about whether the financial statements of the Group and of the Company as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with approved standards on auditing in Malaysia and International Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements of the Group and of the Company, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s and of the Company’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Directors.

• Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s and the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements of the Group and of the Company or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group and the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements of the Group and of the Company, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial statements of the Group. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with the Directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

98 ANNUAL REPORT 2020

Independent Auditors’ Report to the Members of YTL Corporation Berhad

AUDITORS’ RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS (CONT’D.)

We also provide the Directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the Directors, we determine those matters that were of most significance in the audit of the financial statements of the Group and of the Company for the current year and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

In accordance with the requirements of the Companies Act 2016 in Malaysia, we report that the subsidiaries of which we have not acted as auditors, are disclosed in Note 15 to the Financial Statements.

OTHER MATTERS

This report is made solely to the members of the Company, as a body, in accordance with Section 266 of the Companies Act 2016 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.

HLB LER LUM PLT 201906002362 & AF 0276 Chartered Accountants

WONG CHEE HONG 03160/09/2022 J Chartered Accountant

Dated: 30 September 2020 Kuala Lumpur

99 YTL CORPORATION BERHAD

Income Statements for the financial year ended 30 June 2020

Group Company

2020 2019 2020 2019 Note RM'000 RM'000 RM'000 RM'000

Revenue 4 19,178,449 18,047,528 415,331 548,616 Cost of sales 5 (15,594,783) (13,940,465) – –

Gross profit 3,583,666 4,107,063 415,331 548,616 Other operating income 623,644 403,255 6,255 6,210 Selling and distribution costs (470,836) (405,168) – – Administration expenses (1,428,981) (1,333,690) (73,645) (63,626) Other operating expenses (284,651) (398,549) – – Finance costs 6 (1,860,747) (1,747,499) (171,886) (175,950) Share of results of associated companies and joint ventures, net of tax 257,199 411,095 – –

Profit before tax 7 419,294 1,036,507 176,055 315,250 Income tax expense 8 (414,636) (315,152) (6,462) (16,802)

Profit for the year 4,658 721,355 169,593 298,448

Attributable to: Owners of the parent (189,221) 242,589 169,593 298,448 Non-controlling interests 193,879 478,766 – –

4,658 721,355 169,593 298,448

(Loss)/earnings per share (sen) Basic/diluted EPS (sen) 9 (1.78) 2.30

Dividend per ordinary shares (sen) 10 4.00 4.00

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

100 ANNUAL REPORT 2020

Statements of Comprehensive Income for the financial year ended 30 June 2020

Group Company

2020 2019 2020 2019 RM'000 RM'000 RM'000 RM'000

Profit for the year 4,658 721,355 169,593 298,448

Other comprehensive (loss)/income:

Items that will not be reclassified subsequently to income statement: – re-measurement of post-employment benefit obligations (183,829) (50,743) – – - changes in the fair value of equity investments at fair value through other comprehensive income (35,344) (20,987) 123 277 – foreign currency translation (5,302) 184,661 – –

Items that will be reclassified subsequently to income statement: – cash flow hedges (149,487) (353,606) – – – foreign currency translation, net of investment hedges of foreign operations – foreign currency translation (17,419) 128,360 – – – gain reclassified to profit or loss on derecognition of foreign subsidiary (256,748) – – –

Other comprehensive (loss)/income for the year, net of tax (648,129) (112,315) 123 277

Total comprehensive (loss)/income for the year (643,471) 609,040 169,716 298,725

Total comprehensive (loss)/income attributable to: Owners of the parent (657,305) 132,512 169,716 298,725 Non-controlling interests 13,834 476,528 – –

(643,471) 609,040 169,716 298,725

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

101 YTL CORPORATION BERHAD

Statements of Financial Position as at 30 June 2020

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

ASSETS Non-current assets Property, plant and equipment 11 30,499,583 30,759,493 3,852 4,474 Right-of-use assets 12 1,636,035 – 9,069 – Investment properties 13 1,811,126 10,217,573 – – Development expenditures 14 1,128,221 1,127,238 – – Investment in subsidiaries 15 – – 7,764,014 7,807,515 Investment in associates 16 4,216,843 2,581,165 376,235 205,241 Investment in joint ventures 17 165,174 264,184 – – Investments 18 404,911 409,971 44,825 44,445 Intangible assets 19 8,631,094 8,023,200 – – Trade and other receivables 20 1,419,705 1,159,120 – – Contract assets 24 1,705 5,616 – – Derivative financial instruments 21 10,585 18,722 – –

49,924,982 54,566,282 8,197,995 8,061,675

Current assets Inventories 22 2,184,363 2,783,723 – – Property development costs 23 140,857 561,937 – – Trade and other receivables 20 3,204,981 4,198,733 6,110 13,345 Contract assets 24 227,619 239,524 – – Derivative financial instruments 21 74,259 65,022 – – Income tax assets 134,459 121,292 2,930 22,271 Amounts due from related parties 25 53,694 31,131 1,303,468 1,014,435 Investments 18 2,301,989 2,352,947 755,199 797,277 Fixed deposits 26 10,396,221 10,635,496 102,070 198,360 Cash and bank balances 26 1,265,011 1,171,006 1,929 122,948

19,983,453 22,160,811 2,171,706 2,168,636

TOTAL ASSETS 69,908,435 76,727,093 10,369,701 10,230,311

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

102 ANNUAL REPORT 2020

Statements of Financial Position as at 30 June 2020

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

EQUITY AND LIABILITIES Equity attributable to owners of the parent Share capital 27 3,467,555 3,340,111 3,467,555 3,340,111 Other reserves 28(a) 512,535 907,066 82,781 66,676 Retained earnings 8,982,083 9,488,302 3,038,245 3,294,895 Treasury shares, at cost 27(a) (501,837) (472,793) (501,837) (472,793)

12,460,336 13,262,686 6,086,744 6,228,889 Non-controlling interests 3,149,593 7,631,855 – –

Total Equity 15,609,929 20,894,541 6,086,744 6,228,889

Non-current liabilities Long-term payables 29 1,257,300 1,231,419 – – Contract liabilities 24 31,326 26,264 – – Bonds 30 19,655,639 18,961,666 2,500,000 2,500,000 Borrowings 31 12,592,683 11,760,855 – 550 Lease liabilities 32 1,447,352 – 2,479 – Grants and contributions 33 596,669 560,828 – – Deferred tax liabilities 34 2,164,004 2,073,144 113 113 Post-employment benefit obligations 35 910,898 759,646 – – Derivative financial instruments 21 15,401 54,116 – –

38,671,272 35,427,938 2,502,592 2,500,663

Current liabilities Trade and other payables 37 3,044,929 3,685,052 17,462 17,488 Contract liabilities 24 633,343 996,420 – – Derivative financial instruments 21 174,944 63,491 – – Amounts due to related parties 25 39,212 16,006 4,708 5,546 Bonds 30 220,000 520,024 – 10,000 Borrowings 31 11,097,556 14,837,243 1,750,654 1,467,420 Lease liabilities 32 176,495 – 7,254 – Provision for liabilities and charges 36 136,601 147,613 – – Post-employment benefit obligations 35 5,281 4,874 287 305 Income tax liabilities 98,873 133,891 – –

15,627,234 20,404,614 1,780,365 1,500,759

TOTAL LIABILITIES 54,298,506 55,832,552 4,282,957 4,001,422

TOTAL EQUITY AND LIABILITIES 69,908,435 76,727,093 10,369,701 10,230,311

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

103 YTL CORPORATION BERHAD

Statements of Changes in Equity for the financial year ended 30 June 2020

<------Attributable to Owners of the Parent ------> <------Non-distributable ------> <------Distributable ------> Share Other Treasury Non- capital reserves Retained shares controlling Total (Note 27) (Note 28(a)) earnings (Note 27(a)) Total interests equity RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020 At 1 July 2019, as previously reported 3,340,111 907,066 9,488,302 (472,793) 13,262,686 7,631,855 20,894,541 Effects of adopting MFRS 16 – – (21,567) – (21,567) (34,581) (56,148) At 1 July 2019, as restated 3,340,111 907,066 9,466,735 (472,793) 13,241,119 7,597,274 20,838,393

(Loss)/profit for the year – – (189,221) – (189,221) 193,879 4,658 Other comprehensive loss for the year – (366,176) (101,908) – (468,084) (180,045) (648,129)

Total comprehensive (loss)/income for the year – (366,176) (291,129) – (657,305) 13,834 (643,471)

Transactions with owners Changes in composition of the Group – – 311,615 – 311,615 (3,820,251) (3,508,636) Conversion of ICULS – (46,825) (79,524) – (126,349) – (126,349) Dividends paid – – (426,770) – (426,770) (641,264) (1,068,034) Issue of share capital 127,444 – – – 127,444 – 127,444 Share option expenses – 19,343 – – 19,343 – 19,343 Share option lapsed – (527) 527 – – – – Subsidiary’s share option lapsed – (346) 629 – 283 – 283 Treasury shares – – – (29,044) (29,044) – (29,044) At 30 June 2020 3,467,555 512,535 8,982,083 (501,837) 12,460,336 3,149,593 15,609,929

Group – 2019 At 1 July 2018 3,340,111 971,877 9,803,376 (337,142) 13,778,222 7,516,285 21,294,507

Profit for the year – – 242,589 – 242,589 478,766 721,355 Other comprehensive loss for the year – (82,065) (28,012) – (110,077) (2,238) (112,315)

Total comprehensive (loss)/income for the year – (82,065) 214,577 – 132,512 476,528 609,040

Transactions with owners Changes in composition of the Group – – (109,797) – (109,797) 133,640 23,843 Dividends paid – – (422,748) – (422,748) (494,598) (917,346) Share option expenses – 19,635 – – 19,635 – 19,635 Share option lapsed – (1,748) 1,748 – – – – Subsidiary’s share option lapsed – (633) 1,146 – 513 – 513 Treasury shares – – – (135,651) (135,651) – (135,651)

At 30 June 2019 3,340,111 907,066 9,488,302 (472,793) 13,262,686 7,631,855 20,894,541

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

104 ANNUAL REPORT 2020

Statements of Changes in Equity for the financial year ended 30 June 2020

<------Attributable to Owners of the Parent ------> <------Non-distributable ------> <------Distributable ------> Share Other Treasury capital reserves Retained shares (Note 27) (Note 28(a)) earnings (Note 27(a)) Total RM’000 RM’000 RM’000 RM’000 RM’000

Company – 2020 At 1 July 2019 3,340,111 66,676 3,294,895 (472,793) 6,228,889

Profit for the year – – 169,593 – 169,593 Other comprehensive income – 123 – – 123

Total comprehensive income – 123 169,593 – 169,716

Transactions with owners Dividends paid – – (426,770) – (426,770) Issue of share capital 127,444 – – – 127,444 Share option expenses – 16,509 – – 16,509 Share option lapsed – (527) 527 – – Treasury shares – – – (29,044) (29,044)

At 30 June 2020 3,467,555 82,781 3,038,245 (501,837) 6,086,744

Company – 2019 At 1 July 2018 3,340,111 51,468 3,417,447 (337,142) 6,471,884

Profit for the year – – 298,448 – 298,448 Other comprehensive income – 277 – – 277

Total comprehensive income – 277 298,448 – 298,725

Transactions with owners Dividends paid – – (422,748) – (422,748) Share option expenses – 16,679 – – 16,679 Share option lapsed – (1,748) 1,748 – – Treasury shares – – – (135,651) (135,651)

At 30 June 2019 3,340,111 66,676 3,294,895 (472,793) 6,228,889

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

105 YTL CORPORATION BERHAD

Statements of Cash Flows for the financial year ended 30 June 2020

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax 419,294 1,036,507 176,055 315,250

Adjustments for: Adjustment on fair value of investment properties 12,808 (13,172) – – Amortisation of contract costs 7,842 11,569 – – Amortisation of deferred income (5,209) (4,579) – – Amortisation of grants and contributions (15,166) (15,973) – – Amortisation of intangible assets 69,606 10,806 – – Bad debts recovered (2,949) (4,187) – – Bad debts written off 10,901 5,552 – – Depreciation of property, plant and equipment 1,554,423 1,497,585 809 889 Depreciation of right-of-use assets 193,895 – 4,535 – Dividend income (10,083) (29,411) (371,871) (487,269) Fair value changes of derivatives 16,765 19,981 – – Fair value changes of investments (25,976) (62,507) (823) (1,288) Gain on disposal of investments (1,172) – – – Gain on disposal of investment properties – (3,709) – – (Gain)/loss on disposal of property, plant and equipment (18,739) (4,820) – 72 Gain on derecognition of subsidiary (258,506) – – – Impairment losses – net 183,203 159,514 – – Interest expense 1,860,747 1,747,499 171,886 175,950 Interest income (279,072) (311,520) (43,200) (61,056) Inventories written down – net 44,656 77,662 – – Investment properties written off 7,675 – – – Property, plant and equipment written off 51,896 26,793 – – Prospective expenditure written off 8,175 3,392 – – Provision for post-employment benefits 43,790 64,699 – – (Write back of)/provision for liabilities and charges (4,437) 7,520 – – Share option expenses 21,637 22,020 6,654 6,667 Share of results of associated companies and joint ventures (257,199) (411,095) – – Unrealised gain on foreign exchange – net (96,052) (109,570) – –

Operating profit/(loss) before changes in working capital 3,532,753 3,720,556 (55,955) (50,785)

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

106 ANNUAL REPORT 2020

Statements of Cash Flows for the financial year ended 30 June 2020

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

CASH FLOWS FROM OPERATING ACTIVITIES (CONT’D.) Changes in working capital: Inventories 638,001 389,591 – – Property development costs 481 (57,401) – – Receivables 690,251 (675,753) 7,234 (3,049) Contract assets (39,277) (79,135) – – Contract liabilities (405,019) 354,963 – – Payables 93,104 451,648 (40) (3,394) Related parties balances (12,666) (12,024) (237,265) 84,010

Cash flow generated from/(used in) operations 4,497,628 4,092,445 (286,026) 26,782 Dividends received 399,216 438,742 347,132 487,269 Interest paid (1,723,489) (1,659,978) (171,591) (175,950) Interest received 311,049 316,368 43,200 61,056 Payment to post-employment benefit obligations (129,759) (111,214) – – Income tax paid (376,563) (350,349) (11,092) – Income tax refunded 64,621 43,794 23,971 –

Net cash flow from/(used in) operating activities 3,042,703 2,769,808 (54,406) 399,157

CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of additional shares in existing subsidiaries (20,677) (35) (47) (35) Acquisition of new subsidiaries (net of cash acquired) 18,977 (2,596,753) – – Additional investment in associated companies and joint venture (19,253) (367,340) – – Development expenditure incurred (92,311) (132,229) – – Grants received in respect of infrastructure assets 49,342 29,432 – – Maturities of income funds 176,000 1,285,382 – – Proceeds from disposal of investment properties – 13,837 – – Proceeds from disposal of property, plant and equipment 42,521 20,039 – 58 Proceeds from disposal of investments 238,148 11,806 3 11,806 Net derecognition of subsidiary (net of cash and cash equivalents) (245,871) – – – Proceeds from finance lease receivables 4,129 – – – Purchase of intangible assets (175,368) (4,215) – – Purchase of investment properties (559,216) (43,496) – – Purchase of property, plant and equipment (1,579,690) (2,412,100) (187) (292) Purchase of investments (785,059) (192,641) 42,639 (55,047) Shareholder loans (94,651) (60,305) – –

Net cash flow (used in)/from investing activities (3,042,979) (4,448,618) 42,408 (43,510)

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

107 YTL CORPORATION BERHAD

Statements of Cash Flows for the financial year ended 30 June 2020

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid (426,770) (422,748) (426,770) (422,748) Dividends paid to non-controlling interests by subsidiaries (641,264) (494,598) – – Repurchase of own shares by the company (at net) (29,044) (135,651) (29,044) (135,651) Repurchase of subsidiaries’ shares by subsidiaries (2) (198,625) – – Proceeds from bonds 1,312,199 510,000 – 510,000 Proceeds from borrowings 5,514,829 6,657,542 465,784 – Repayment of bonds (10,000) (500,000) (10,000) (500,000) Repayment of borrowings (6,097,544) (3,763,118) (200,565) (1,058) Repayment of lease liabilities (429,879) – (4,716) – Upfront fees and discounts on borrowings – (1,950) – –

Net cash flow (used in)/from financing activities (807,475) 1,650,852 (205,311) (549,457)

Net decrease in cash and cash equivalents (807,751) (27,958) (217,309) (193,810) Effects of exchange rate changes 143,990 190,142 – – Cash and cash equivalents at beginning of year 11,763,827 11,601,643 321,308 515,118

Cash and cash equivalents at end of year (Note 26) 11,100,066 11,763,827 103,999 321,308

NOTE TO THE STATEMENTS OF CASH FLOWS

Analysis of acquisition of property, plant and equipment:

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Cash 1,579,690 2,412,100 187 292 Finance lease arrangement – 2,210 – 1,195 Interest expense paid/payable 18,554 8,348 – – Transfer of assets from customers 91,836 56,766 – – Transfer from prepayments 58,733 – – – Payables 16,182 5,135 – –

1,764,995 2,484,559 187 1,487

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

108 ANNUAL REPORT 2020

Statements of Cash Flows for the financial year ended 30 June 2020

NOTE TO THE STATEMENTS OF CASH FLOWS (CONT’D.) Reconciliation of liabilities arising from financing activities:- 1. Bonds and borrowings

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

At 1 July 46,079,788 41,786,512 3,977,970 3,967,833 Changes from financing cash flows Interest paid (1,723,489) (1,659,978) (171,591) (175,950) Proceeds from bonds 1,312,199 510,000 – 510,000 Proceeds from borrowings 5,514,829 6,657,542 465,784 – Upfront fees on borrowings – (1,950) – – Repayment of bonds (10,000) (500,000) (10,000) (500,000) Repayment of borrowings (6,097,544) (3,763,118) (200,565) (1,058) Transactions costs paid (6,405) – – – Other changes in bonds and borrowings Acquisition of subsidiaries – 1,001,103 – – Amortisation of issuance cost/unwinding of premium 138,134 117,621 – – Bank overdrafts 24,607 (12,295) – – Capitalisation of issuance cost – (44,430) – – Conversion of ICULS into ordinary shares (2,736) – – – Derecognition of subsidiary (3,493,431) – – – Finance leases – 1,195 – 1,195 Finance costs capitalised in property development costs 4,906 12,463 – – Interest expenses 1,808,555 1,747,499 171,591 175,950 Foreign exchange movement 16,465 227,624 17,465 – At 30 June 43,565,878 46,079,788 4,250,654 3,977,970

2. Lease liabilities

Group Company 2020 2020 RM’000 RM’000

At 1 July 2019, as previously reported – – Effect of adopting of MFRS 16 953,623 -

At 1 July 2019, as restated 953,623 – Changes from financing cash flows Repayment of lease liabilities (429,879) (4,716) Other changes in lease liabilities Additions 1,053,070 14,154 Interest expenses 47,286 295 Termination (420) – Foreign exchange movement 167 –

At 30 June 1,623,847 9,733

The accompanying accounting policies and explanatory notes form an integral part of the financial statements. 109 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

1. CORPORATE INFORMATION

The principal activities of the Company are those of an investment holding and management company. The principal activities of the subsidiaries are set out in Note 15 to the financial statements.

The Company is a limited liability company, incorporated and domiciled in Malaysia and listed on the Main Market of Bursa Malaysia Securities Berhad and the foreign section of the Tokyo Stock Exchange.

The address of the registered office and principal place of business of the Company is as follow:-

33rd Floor, Menara YTL 205 Jalan Bukit Bintang 55100 Kuala Lumpur

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of preparation

The financial statements of the Group and the Company have been prepared under historical cost convention (unless stated otherwise in the significant accounting policies below) and in accordance with Malaysian Financial Reporting Standards (“MFRS”), International Financial Reporting Standards (“IFRS”) and the requirements of the Companies Act 2016 in Malaysia.

The preparation of financial statements in conformity with the MFRS and the Companies Act 2016 requires the Directors to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported period. It also requires the Directors to exercise their judgements in the process of applying the Group’s accounting policies. Although these estimates and judgements are based on Directors’ best knowledge of current events and actions, actual results may differ.

The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 3 to the financial statements.

The financial statements are presented in Ringgit Malaysia (RM) and all values are rounded to the nearest thousand (RM’000) except as otherwise indicated.

(b) Changes in accounting policies

The accounting policies adopted are consistent with those of the previous financial year except as follows:

On 1 July 2019, the Group and the Company have adopted the following MFRSs, IC Interpretations and amendments which are mandatory for annual financial periods beginning on or after 1 July 2019.

Effective for annual periods beginning Description on or after

MFRS 16 ‘Leases’ 1 January 2019 Amendment to MFRS 3 ‘Business Combination: Previously Held Interest in a Joint Operation’ 1 January 2019 Amendment to MFRS 9 ‘Financial Instruments: Prepayment Features with Negative Compensation’ 1 January 2019 Amendment to MFRS 11 ‘Joint Arrangements: Previously Held Interest in a Joint Operation’ 1 January 2019

110 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(b) Changes in accounting policies (cont’d.)

Effective for annual periods beginning Description on or after

Amendment to MFRS 112 ‘Income Taxes: Income Tax Consequences of Payments on Financial Instruments Classified as Equity’ 1 January 2019 Amendment to MFRS 119 ‘Plan Amendment, Curtailment or Settlement’ 1 January 2019 Amendment to MFRS 123 ‘Borrowing Costs: Borrowing Costs Eligible for Capitalisation’ 1 January 2019 Amendment to MFRS 128 ‘Long-term Interests in Associates and Joint Ventures’ 1 January 2019 IC Interpretation 23 ‘Uncertainty over Income Tax Treatments’ 1 January 2019

The adoption of the above new standards, IC interpretations and amendments to published standards have not given rise to any material impact on the financial statements of the Group and the Company, except for changes arising from the adoption of MFRS 16 as disclosed in Note 44.

(c) Standards issued but not yet effective

The standards and interpretations that are issued but not yet effective up to the date of issuance of the Group’s and the Company’s financial statements are disclosed below. The Group and the Company intend to adopt these standards, if applicable, when they become effective.

Effective for annual periods beginning Description on or after

Amendments to References to the Conceptual Framework in MFRSs Standards: – Amendment to MFRS 2 Share-Based Payment 1 January 2020 – Amendment to MFRS 9 ‘Financial Instruments: Prepayment Features with Negative Compensation 1 January 2020 – Amendments to MFRS 6 Exploration for and Evaluation of Mineral Resources 1 January 2020 – Amendment to MFRS 101 Presentation of Financial Statements 1 January 2020 – Amendment to MFRS 108 Accounting Policies, Changes in Accounting Estimates and Errors 1 January 2020 – Amendment to MFRS 134 Interim Financial Reporting 1 January 2020 – Amendment to MFRS 137 Provisions, Contingent Liabilities and Contingent Assets 1 January 2020 – Amendment to MFRS 138 Intangible Assets 1 January 2020 – Amendment to IC Interpretation 12 Service Concession Arrangements 1 January 2020 – Amendment to IC Interpretation 19 Extinguishing Financial Liabilities with Equity Instruments 1 January 2020 – Amendment to IC Interpretation 20 Stripping Costs in the Production Phase of a Surface Mine 1 January 2020 – Amendment to IC Interpretation 22 Foreign Currency Transactions and Advance Consideration 1 January 2020 – Amendment to IC Interpretation 132 Intangible Assets – Web Site Costs 1 January 2020 Definition of a Business (Amendments to MFRS 3 Business Combinations) 1 January 2020 Definition of Material (Amendments to MFRS 101 Presentation of Financial Statements and Amendments to MFRS 108 Accounting Policies, Changes in Accounting Estimates and Errors) 1 January 2020 Amendments to MFRS 9 Financial Instruments, MFRS 139 Financial Instruments: Recognition and Measurement and MFRS 7 Financial Instruments: Disclosures on Interest Rate Benchmark Reform 1 January 2020

111 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(d) Revenue recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. The specific recognition criteria for revenue are as follows:-

(i) Revenue from contracts with customers

Revenue which represents income arising in the course of the Group’s ordinary activities is recognised by reference to each distinct performance obligation promised in the contract with customer. Revenue from contracts with customers is measured at its transaction price, being the amount of consideration which the Group expects to be entitled in exchange for transferring promised goods or services to a customer, net of goods and service tax, returns, rebates and discounts. Transaction price is allocated to each performance obligation on the basis of the relative stand-alone selling prices of each distinct good or services promised in the contract. Depending on the substances of the respective contract with the customer, revenue is recognised when the performance obligation is satisfied, which may be at a point in time or over time.

a) Sale of electricity

The Group’s electricity is generated and sold into national electricity company or market in the respective countries in which the Group operates.

Revenue from sale of electricity is recognised over time upon delivery of the electricity to the customers at a single point within the electricity grid.

Revenue are presented, net of goods and service tax, penalties, rebates and discounts. Collection of the contract consideration from customers is considered probable. No element of financing is deemed present as the Group has adopted the practical expedient available in MFRS 15 where the interval between transfer of the promised goods or services and payment by the customer is expected to be less than 12 months.

Electricity revenue includes an estimated value of the electricity consumed by customer from the date of the last meter reading available and reporting period end. Accrued unbilled revenue is recognised as receivables and is reversed the following month when actual billings occur.

b) Sale of clean water and the treatment and disposal of waste water

The Group, under the license granted by the United Kingdom (“UK”) Government, has the right to supply water and sewerage services to customers, together with an obligation to maintain and develop the network and ensure its continued availability.

The nature of the water industry in the UK is such that revenue recognition is subject to a degree of estimation. The assessment of water sales to customers is based on internal data where final settlement data is not yet available. At the end of each period, amounts of water delivered to customers are estimated and the corresponding billed and unbilled revenue is assessed and recorded in revenue. For the purpose of the judgement, various factors are considered such as seasonality, historic billing profiles, leakage data and general economic conditions.

112 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(d) Revenue recognition (cont’d.)

(i) Revenue from contracts with customers (cont’d.)

b) Sale of clean water and the treatment and disposal of waste water (cont’d.)

For metered customers, revenue is determined by the meter reading. For unmetered customers, the amount to which the Group has a right to receive is determined by the passage of time during which the customer occupies a property within the Group’s licenced region. Revenue represents income receivable in the ordinary course of business, excluding VAT, for services provided. Revenue is recognised to the extent that it is probable that economic benefits will flow to the Group.

Developer services related to the obligation under statute to allow property developers to establish an authorised connection to the water and/or sewerage network. In obtaining the connection, the developer may require the Group to undertake one or more of the following:

i) Connections and meter installation in exchange for payment; ii) Requisitions of water mains in exchange for payment; and iii) Adoptions of water and waste water mains.

The developer is also required to pay infrastructure charges being a contribution to network reinforcement.

These activities are not separable nor distinct and instead form a bundle of activities necessary to establish an authorised connection from which the network access can be obtained. Also, the Group has an additional obligation under statute to keep the connection in place for all current and future occupiers and facilitate ongoing access to the network for as long as the property requires service provision. Consequently, revenue from developer services will be deferred over the shorter of expected period of service provision or the need to replace the assets at the end of their useful life (typically in the range 60 to 125 years).

No element of financing is deemed present for developer services as the timing difference does not arise as a result of the provision of finance, but rather comes as a consequence of the nature of the regulatory environment.

Unbilled receivables are considered to be a variable consideration which is not constrained as the Group considers it to be highly probable that a significant amount will not be reversed after year end. Unbilled receivables and the variable consideration are estimated using the most likely outcome approach.

c) Sale of cement and related products

Revenue from sale of cement and related products is recognised at the point in time when control of the goods is transferred to the customer.

A contract with customer exists when the contract has commercial substance, the Group and their customers have approved the contract and intend to perform their respective obligations, the Group’s and the customer’s rights regarding the goods or services to be transferred and the payment terms can be identified, and it is probable that the Group will collect the consideration to which it will be entitled in exchange of those goods or services.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(d) Revenue recognition (cont’d.)

(i) Revenue from contracts with customers (cont’d.)

c) Sale of cement and related products (cont’d.)

In determining the transaction price for the sale of cement and related products, the Group considers the effects of variable consideration.

If the consideration in a contract includes a variable amount, the Group estimate the amount of consideration to which they will be entitled in exchange for transferring the goods to the customer. The variable consideration is estimated at contract inception and constrained until it is highly probable that a significant revenue reversal in the amount of cumulative revenue recognised will not occur when the associated uncertainty with the variable consideration is subsequently resolved. Some contracts for the sale of cement and related products provide customers with prompt payment rebates and volume rebates. The early payment rebates, prompt payment rebates and volume rebates give rise to variable consideration.

d) Hotel operations

The Group generates revenue mainly from providing the service of room rentals to tenants within the hotel and rental of spaces for functions and banquets. The Group also generates revenue from the sale of services such as food and beverage, as well as minor services such as telecommunication, laundry, internet and other minor services.

Revenue is recognised when the terms of a contract have been satisfied, which occurs when control has been transferred to customers and performance obligations are satisfied. For room revenue, this occurs evenly throughout the duration of the tenant’s use on a straight-line basis. For functions and banquets, revenue is recognised at a point in time when the performance obligation is satisfied, generally at the provision of the space.

e) Construction contracts

Under such contracts, the Group is engaged to construct buildings and related infrastructure and in certain instances to supply equipments. These contracts may include multiple promises to the customers and therefore accounted for as separate performance obligations. In this case, the transaction price will be allocated based on relative stand- alone selling price of the considerations of each of the separate performance obligations. When these are not directly observable, they are estimated based on expected cost plus margin.

Revenue from construction contracts is measured at the fixed transaction price agreed under the agreement.

The Group determines the transaction price of a contract after considering the effect of variable consideration, constraining estimates of variable consideration, effect of significant financing component, non-cash consideration and consideration payable to customer.

When the fair value of variable consideration is uncertain, the Group estimates the amount of consideration by using the most likely amount method and only recognises to the extent that is highly probable that a significant reversal in cumulative revenue will not occur.

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Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(d) Revenue recognition (cont’d.)

(i) Revenue from contracts with customers (cont’d.)

e) Construction contracts (cont’d.)

Revenue is recognised as and when control of the asset is transferred to the customer and it is probable that the Group would collect the consideration to which it will be entitled in exchange for the asset that would be transferred to the customer. Depending on the terms of the contract and the laws that apply to the contract, control of the asset may transfer over time or at a point in time. Control of the asset is transferred over time if the performance of the Group does not create an asset with an alternative use to the Group and the Group has an enforceable right to payment for performance completed to date.

If control of the asset transfers over time, revenue is recognised over the period of the contract by reference to the progress towards complete satisfaction of that performance obligation using the input method, which is based on the total actual construction cost incurred to date as compared to the total budgeted costs for the respective construction projects.

If control of the asset transfers at a point in time, revenue is recognised at a point in time when the customer obtains control of the asset.

f) Broadband and telecommunications

The Group generates revenue from providing telecommunication services, such as access to the network, airtime usage, messaging and internet services as well as from sales of products. Products and services may be sold separately or in bundled packages. The typical length of a contract for bundled packages is 11 months to 24 months.

For bundled packages, the Group accounts for individual products and services separately if they are distinct, i.e. if a product or service is separately identifiable from other items in the bundled package and if a customer can benefit from it. The consideration is allocated between separate products and services in a bundle based on their Relative Stand-alone Selling Prices (“RSSP”). The RSSP are determined based on the list prices at which the Group sells the products and telecommunication services. RSSP are based on observable sales prices; however, where RSSP are not directly observable, estimates will be made maximising the use of observable inputs.

i) Telecommunication services

Telecommunication revenue from postpaid and prepaid services provided by the Group is recognised over time, as the benefits of telecommunication services are simultaneously received and consumed by the customer.

Revenue from prepaid services is recognised when services are rendered. Starter packs with a sim card and reload voucher is accounted for as a single performance obligation as the sim card can only be used together with the services provided by the Group. Prepaid credits are recognised as contract liability in the statements of financial position. Revenue is recognised when the credits are utilised or up to the point of customer churn or upon expiry, whichever is earlier.

115 YTL CORPORATION BERHAD

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(d) Revenue recognition (cont’d.)

(i) Revenue from contracts with customers (cont’d.)

f) Broadband and telecommunications (cont’d.)

i) Telecommunication services (cont’d.)

Postpaid services are provided in postpaid packages which consist of various services (i.e. call minutes, internet data, sms and etc.). These postpaid packages have been assessed to meet the definition of a series of distinct services that are substantially the same and have the same pattern of transfer and as such the Group treats these packages as a single performance obligation.

Postpaid packages are either sold separately or bundled together with the sale of device to a customer. As postpaid packages and device are capable of being distinct and separately identifiable, there are two performance obligations within a bundled transaction. Accordingly, the Group allocates the transaction price based on the RSSP of the postpaid packages and device.

ii) Devices

Devices may be sold separately or in bundled packages. The Group recognises revenue when control of the device has transferred to the customer upon delivery and acceptance of the device at the point of sale.

For devices sold separately, the consideration is received in full at the point of sale. For devices sold in bundled packages, the customers usually offered to pay at a discounted price on the device. The amount of revenue recognised for devices sold in bundled packages is measured at the allocated consideration based on the RSSP as explained previously.

Devices that the Group promises to transfer as part of the bundled package with network service plans are considered distinct and thus accounted for as a separate performance obligation. Devices that are transferred as part of a fixed line telecommunication services bundled package which can only be used together with the services provided by the Group, are considered as a single performance obligation in telecommunications service revenue.

A contract asset is recognised when the Group delivers the devices before the payment is due. If the payment happens before the delivery of device, then a contract liability is recognised. Contract assets and contract liabilities are presented in the statements of financial position.

The Group generates revenue from telecommunication infrastructure business. Telecommunication infrastructure business revenue is generated from the leasing of space on the Group’s telecommunication towers, where the customers install and maintain their individual communication network equipment. The revenue is recognised on a straight-line basis over the fixed and non-cancellable term of the lease agreement, irrespective of when payment are due.

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Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(d) Revenue recognition (cont’d.)

(i) Revenue from contracts with customers (cont’d.)

g) Property development projects

Contracts with customers may include multiple promises to customers and therefore accounted for as separate performance obligations. The transaction price will be allocated to each performance obligation based on the stand- alone selling prices. When these are not directly observable, they are estimated based on expected cost-plus margin.

The revenue from property development is measured at fixed transaction price agreed under the sale and purchase agreement.

Revenue from property development is recognised as and when the control of the asset is transferred to the customer and it is probable that the Group will collect the consideration to which it will be entitled in exchange for the asset that will be transferred to the customer. Depending on the terms of the contract and the laws that apply to the contract, control of the asset may transfer over time or at a point in time. Control of the asset is transferred over time if the Group’s performance does not create an asset with an alternative use to the Group and the Group has an enforceable right to payment for performance completed to date.

The promised properties are specifically identified by its lot and unit number and its attributes (such as its size and location) in the sale and purchase agreements and the attached layout plan. The purchasers could enforce its rights to the promised properties if the Group seeks to sell the unit to another purchaser. The contractual restriction on the Group’s ability to direct the promised property for another use is substantive use to the Group. The Group is entitled to continue to transfer to the customer the development units promised and has the rights to complete the construction of the properties and enforce its rights to full payment.

If the control of the asset transfers over time, revenue is recognised over the period of the contract by reference to the progress towards complete satisfaction of that performance obligation. Otherwise, revenue is recognised at a point in time when the customer obtains control of the asset.

The Group recognised revenue over time using the input method, which is based on the actual cost incurred to date on the property development projects as compared to the total budgeted cost for respective development projects.

The Group recognised sales at a point in time for the sale of completed properties, when the control of the properties has been transferred to the purchasers, being when the properties have been completed and delivered to the customers and it is probable that the Group will collect the considerations to which it will be entitled to in exchange for the assets sold.

The Group has determined that it has a significant financing component related to the sales of its property units being developed under the deferred payment scheme. As a result of this the amount of the promised consideration is adjusted for the significant financing component and the related interest income is recognised using the effective interest method over the term of the deferment.

117 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(d) Revenue recognition (cont’d.)

(i) Revenue from contracts with customers (cont’d.)

h) Sale of steam

The Group’s sale of steam is mainly derived from wholesale market customers. Revenue from sales of steam is recognised as and when the Group’s customers simultaneously receive and consume the benefits (i.e. the customers are able to utilise the steam for their benefit as and when the steam is being supplied) arising from the Group performing its obligations based on the terms of the contracts with the customers. Accordingly, revenue from the supply of steam is recognised over time; i.e. as and when the steam supplied is consumed by the customers.

No element of financing is deemed present as the Group has adopted the practical expedient available in MFRS 15 where interval between transfer of the promised goods or services and payment by the customer is expected to be less than 12 months.

i) Others

Other income earned by the Group is recognised as the following bases:

i) Sale of fuel oil

Sale of fuel oil is recognised when control of the products has transferred, being when the products are delivered to the customer and there is no unfulfilled obligation that could affect the customer’s acceptance of the products. Delivery occurs when the products have been transported to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, the acceptance provisions have lapsed, or the Group has objective evidence that all criteria for acceptance have been satisfied.

Revenue from these sales is recognised based on the price specified in the contract and revenue is only recognised to the extent that it is highly probable that a significant reversal will not occur. No element of financing is deemed present as the Group has adopted the pratical expedient available in MFRS 15 where the interval between transfer of the promised goods or services and payment by the customer is expected to be less than 12 months.

A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

ii) Sale of natural gas

Revenue from sale of natural gas is recognised as and when the Group’s customers simultaneously receive and consume the benefits (i.e. the customers are able to utilise the gas for their benefit as and when the gas is being supplied) arising from the Group performing its obligations based on the terms of the contracts with the customers. Accordingly, revenue from the supply of gas is recognised over time; i.e. as and when the gas supplied is consumed by the customers. No element of financing is deemed present as the Group has adopted the practical expedient available in MFRS 15 where the interval between transfer of the promised goods or services and payment by the customer is expected to be less than 12 months.

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Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(d) Revenue recognition (cont’d.)

(i) Revenue from contracts with customers (cont’d.)

i) Others (cont’d.)

iii) Operation and maintenance fees

Management fees is recognised over the period in which the services are rendered.

iv) Tank leasing fees

Tank leasing fees from operating leases are recognised on a straight-line basis over the lease term.

(ii) Revenue from other sources

Specific revenue recognition criteria for other revenue and income earned by the Group and the Company are as follows:

a) Interest income

Interest income is recognised as the interest income accrues, taking into account the effective yield on the asset.

b) Dividend income

Dividend income is recognised when the right to receive the payment is established.

c) Rental income

Rental income from operating leases (net of any incentives given to the lessees) is recognised on the straight-line basis over the lease term.

(e) Employee benefits

(i) Short-term employee benefits

Wages, salaries, social security contributions, paid annual leave, paid sick leave, bonuses and non-monetary benefits are recognised as an expense in the financial year when employees have rendered their services to the Group and the Company.

Bonuses are recognised as an expense when there is a present, legal or constructive obligation to make such payments, as a result of past events and when a reliable estimate can be made of the amount of the obligation.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(e) Employee benefits (cont’d.)

(ii) Post-employment benefits

The Group has various post-employment benefit schemes in accordance with local conditions and practices in the industries in which it operates.

These benefit plans are either defined contribution or defined benefit plans.

a) Defined contribution plan

A defined contribution plan is a pension plan under which the Group and the Company pays fixed contributions into a separate entity (a fund) and will have no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees benefits relating to employee service in the current and prior periods.

The Group’s and the Company’s contributions to a defined contribution plan are charged to the profit or loss in the period to which they relate.

b) Defined benefit plan

A defined benefit plan is a pension plan that defines an amount of pension benefit to be provided, usually as a function of one or more factors such as age, years of service or compensation.

The liability in respect of a defined benefit plan is the present value of the defined benefit obligation at the reporting date minus the fair value of plan assets.

The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating to the terms of the related pension obligation.

Re-measurement gains and losses of post-employment benefit obligations are recognised in Other Comprehensive Income.

Past-service costs are recognised immediately in the Income Statements.

(iii) Share-based compensation

The Company and certain subsidiaries operate equity-settled, share-based compensation plan for the employees of the Group. The fair value of the employee services received in exchange for the grant of the share options is recognised as an expense in the profit or loss over the vesting periods of the grant with a corresponding increase in equity.

The total amount to be expensed over the vesting period is determined by reference to the fair value of the share options granted and the number of share options to be vested by vesting date. At each reporting date, the Group revises its estimates of the number of share options that are expected to vest. It recognises the impact of the revision of original estimates, if any, in the profit or loss, with a corresponding adjustment to equity. For options granted by the Company to its subsidiaries’ employees, the expense will be recognised in the subsidiaries’ financial statements over the vesting periods of the grant.

The proceeds received net of any directly attributable transaction costs are credited to share capital when the options are exercised.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(f) Borrowing costs

Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly attributable to the acquisition, construction or production of that asset. Borrowing costs are capitalised until the assets are substantially completed for their intended use or sale.

All other borrowing costs are recognised in profit or loss in the period they are incurred. Borrowing costs consist of interest and other costs that the Group and the Company incurred in connection with the borrowing of funds.

(g) Income tax and deferred tax

Income tax on the profit or loss for the financial year comprises current and deferred tax.

Current tax is the expected amount of income taxes payable in respect of the taxable profit for the financial year and is measured using the tax rates that have been enacted or substantively enacted at the reporting date.

Deferred tax is recognised in full, using the liability method, on temporary differences arising between the amounts attributable to assets and liabilities for tax purposes and their carrying amounts in the financial statements. However, deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction that at the time of the transaction affects neither accounting nor taxable profit or loss.

Deferred tax assets are recognised only to the extent that it is probable that taxable profit will be available against which the deductible temporary differences or unused tax losses can be utilised.

Deferred tax is determined using tax rates (and tax laws) that have been enacted or substantively enacted by the reporting date and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

(h) Property, plant and equipment, and depreciation

Property, plant and equipment except for certain freehold land and buildings is stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the items. Cost also includes borrowing costs incurred for property, plant and equipment under construction. The cost of certain property, plant and equipment include the costs of dismantling, removal and restoration, the obligation of which was incurred as a consequence of installing the asset.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the profit or loss during the financial year in which they are incurred.

Certain freehold land and buildings were revalued by the Directors in 1983 based on valuations carried out by independent professional valuers on the open market basis. In accordance with the transitional provisions issued by MFRS 116 ‘Property, Plant and Equipment’, the valuation of these properties, plant and equipment have not been updated and they continue to be stated at their previously revalued amounts less depreciation and impairment losses.

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Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(h) Property, plant and equipment, and depreciation (cont’d.)

Property, plant and equipment retired from active use and held for disposal are stated at the lower of net book value and net realisable value.

Freehold land and freehold oil palm plantation are not amortised.

Assets under construction are stated at cost and are not depreciated. Upon completion, assets under construction are transferred to categories of property, plant and equipment depending on nature of assets and depreciation commences when they are ready for their intended use.

Depreciation on all other property, plant and equipment is calculated on the straight-line basis at rates required to write off the cost of the property, plant and equipment over their estimated useful life.

The principal annual rates of depreciation used are as follows:-

%

Buildings 1 – 10 Leasehold land 1 – 3 Infrastructure & site facilities 0.9 – 20 Plant & machinery 4 – 20 Furniture, fixtures & equipment 10 – 50 Vehicles 10 – 33⅓ Telecommunication equipment 4 – 20

Residual value, useful life and depreciation method of assets are reviewed at each financial year end to ensure that the amount, method and period of depreciation are consistent with previous estimates and the expected pattern of consumption of the future economic benefits embodied in the items of property, plant and equipment.

Gains and losses on disposals are determined by comparing net disposal proceeds with net carrying amount and are recognised in the profit or loss.

(i) Investment properties

Investment properties include those portions of buildings that are held for long-term rental yields and/or for capital appreciation and freehold land and/or land under operating leases that is held for long-term capital appreciation or for a currently indeterminate use. Investment properties include properties that are being constructed or developed for future use as investment properties.

Investment properties are measured initially at cost and subsequently at fair value with any change therein recognised in profit or loss for the period in which they arise. Where the fair value of the investment property under construction is not reliably determinable, the investment property under construction is measured at cost until either its fair value becomes reliably determinable or construction is complete, whichever is earlier.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(i) Investment properties (cont’d.)

Cost included expenditure that is directly attributable to the acquisition of the investment property. The cost of self-constructed investment property includes the cost of materials and direct labour, any other costs directly attributable to bringing the investment property to a working condition for their intended use and capitalised borrowing costs.

An investment property is derecognised on its disposal, or when it is permanently withdrawn from use and no future economic benefits are expected from its disposal. The difference between the net disposal proceeds and the carrying amount is recognised in profit or loss in the period in which the item is derecognised.

(j) Development expenditure

(i) Land held for property development

Land held for property development consists of land where no development activities have been carried out or where development activities are not expected to be completed within the normal operating cycle. Such land is classified within non-current assets and is stated at the lower of cost and net realisable value.

Cost comprises cost of land and all related costs incurred on activities necessary to prepare the land for its intended use.

Land held for property development is reclassified as property development costs and included under current assets when development activities have commenced and where it can be demonstrated that the development activities can be completed within the normal operating cycle.

(ii) Project development expenditure

Development expenditure incurred is capitalised when it meets certain criteria that indicate that it is probable that the costs will give rise to future economic benefits and are amortised over the period of the projects. They are written down to their recoverable amounts when there is insufficient certainty that future economic benefits will flow to the enterprise.

Development costs previously recognised as an expense are not recognised as an asset in subsequent periods.

Capitalised development expenditure is stated at cost less accumulated amortisation and impairment losses.

(k) Impairment of non-financial assets

The carrying amounts of assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, an asset’s recoverable amount is estimated to determine the amount of impairment loss.

An impairment loss is recognised for the amount by which the carrying amount of the asset exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less cost of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash- generating units). Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date.

An impairment loss is charged to the profit or loss immediately, unless the asset is carried at revalued amount. Any impairment loss of a revalued asset is treated as a revaluation decrease to the extent of previously recognised revaluation surplus for the same asset.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(k) Impairment of non-financial assets (cont’d.)

Impairment losses on goodwill are not reversed. In respect of other assets, any subsequent increase in the recoverable amount of an asset is treated as reversal of the previous impairment loss and is recognised to the extent of the carrying amount of the asset that would have been determined (net of amortisation and depreciation) had no impairment loss been recognised. The reversal is recognised in the profit or loss immediately, unless the asset is carried at revalued amount. A reversal of an impairment loss on a revalued asset is credited directly to revaluation surplus. However, to the extent that an impairment loss on the same revalued asset was previously recognised as an expense in the profit or loss, a reversal of that impairment loss is recognised as income in the profit or loss.

(l) Basis of consolidation

The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at the reporting date. The financial statements of the subsidiaries used in the preparation of the consolidated financial statements are prepared for the same reporting date as the Company. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.

The Group controls an investee if and only if the Group has all the following: • Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee); • Exposure, or rights, to variable returns from its investment with the investee; and • The ability to use its power over the investee to affect its returns.

When the Group has less than a majority of the voting rights of an investee, the Group considers the following in assessing whether or not the Group’s voting rights in an investee are sufficient to give it power over the investee:- • The contractual arrangement(s) with the other vote holders of the investee; • Rights arising from other contractual arrangements; and • The Group’s voting rights and potential voting rights.

The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary.

Profit or loss and each component of OCI are attributed to the equity holders of the parent of the Group and to the non- controlling interests, even if this results in the non-controlling interests having a deficit balance. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the Group’s accounting policies. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full on consolidation.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(l) Basis of consolidation (cont’d.)

A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it: • derecognises the assets (including goodwill) and liabilities of the subsidiary; • derecognises the carrying amount of any non-controlling interests; • derecognises the cumulative translation differences recorded in equity; • recognises the fair value of the consideration received; • recognises the fair value of any investment retained; • recognises any surplus or deficit in profit or loss; and • reclassifies the parent’s share of components previously recognised in other comprehensive income to profit or loss or retained earnings, as appropriate, as would be required if the Group had directly disposed of the related assets or liabilities.

Acquisitions of subsidiaries are accounted for by applying the purchase method. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Adjustments to those fair values relating to previously held interests are treated as a revaluation and recognised in other comprehensive income.

The cost of a business combination is measured as the aggregate of the fair values, at the date of exchange, of the assets given, liabilities incurred or assumed, and equity instruments issued, plus any costs directly attributable to the business combination. Any excess of the cost of business combination over the Group’s share in the net fair value of the acquired subsidiary’s identifiable assets, liabilities and contingent liabilities is recorded as goodwill in the statements of financial position. The accounting policy for goodwill is set out in Note 2(q) to the financial statements. Any excess of the Group’s share in the net fair value of the acquired subsidiary’s identifiable assets, liabilities and contingent liabilities over the cost of business combination is recognised as income in profit or loss on the date of acquisition. When the Group acquires a business, embedded derivatives separated from the host contract by the acquiree are reassessed on acquisition unless the business combination results in a change in the terms of the contract that significantly modifies the cash flows that would otherwise be required under the contract.

(m) Transactions with non-controlling interests

The Group treats transactions with non-controlling interests as transactions with equity owners of the Group. For purchases from non-controlling interests, the difference between any consideration paid and the relevant shares acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity.

(n) Investment in subsidiaries

A subsidiary is an entity over which the Group has all the following:- • Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee); • Exposure, or rights, to variable returns from its investment with the investee; and • The ability to use its power over the investee to affect its returns.

In the Company’s separate financial statements, investments in subsidiaries are accounted for at cost less accumulated impairment losses. On disposal of investments in subsidiaries, the difference between disposal proceeds and the carrying amounts of the investments are recognised in profit or loss.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(o) Investment in associated companies

Associated companies are entities in which the Group is in a position to exercise significant influence but which is neither a subsidiary nor an interest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisions, but not control over their policies. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group has significant influence over another entity.

Investments in associated companies are accounted for in the consolidated financial statements using the equity method of accounting and are initially recognised at cost. The Group’s investment in associated companies includes goodwill identified on acquisition, net of any accumulated impairment loss.

In applying the equity method of accounting, the Group’s share of its associated companies’ post-acquisition profits or losses are recognised in profit or loss and its share of post-acquisition movements in reserves is recognised in other comprehensive income. The cumulative post-acquisition movements and distributions received from the associated companies are adjusted against the carrying amount of the investment. When the Group’s share of losses in an associated company equals or exceeds its interest in the associated company, including any other unsecured obligations, the Group does not recognise further losses, unless it has obligations or has made payments on behalf of the associated company.

The most recent available audited financial statements of the associated companies are used by the Group in applying the equity method. Where the dates of the audited financial statements used are not coterminous with those of the Group, the share of results is arrived at from the last audited financial statements available and management financial statements to the end of the accounting period. Where necessary, adjustments are made to the financial statements of associated companies to ensure consistency of accounting policies with those of the Group.

Unrealised gains on transactions between the Group and its associated companies are eliminated to the extent of the Group’s interest in the associated companies. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Gains and losses arising from partial disposals or dilutions in investments in associated companies are recognised in profit or loss.

Investments in associated companies are derecognised when the Group loses significant influence. Any retained interest in the entity is remeasured at its fair value. The difference between the carrying amount of the retained investment at the date when significant influence is lost and its fair value is recognised in profit or loss.

In the Company’s separate financial statements, investments in associated companies are stated at cost less accumulated impairment losses. On disposal of investments in associated companies, the difference between disposal proceeds and the carrying amounts of the investments are recognised in profit or loss.

(p) Joint arrangements

A joint arrangement is an arrangement of which there is contractually agreed sharing of control by the Group with one or more parties, where decisions about the relevant activities relating to the joint arrangement require unanimous consent of the parties sharing control. The classification of a joint arrangement as a joint operation or a joint venture depends upon the rights and obligations of the parties to the arrangement. A joint venture is a joint arrangement whereby the joint venturers have rights to the net assets of the arrangement. A joint operation is a joint arrangement whereby the joint operators have rights to the assets and obligations for the liabilities, relating to the arrangement.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(p) Joint arrangements (cont’d.)

Joint venture

The Group’s interests in joint ventures are accounted for by the equity method of accounting based on the audited financial statements of the joint ventures made up to the end of the financial year.

Equity accounting involves recognising in the profit or loss the Group’s share of the results of joint ventures for the financial year. The Group’s investments in joint ventures are carried in the Statements of Financial Position at an amount that reflects its share of the net assets of the joint ventures and includes goodwill on acquisition.

Unrealised gains on transactions between the Group and its joint ventures are eliminated to the extent of the Group’s interest in the joint ventures; unrealised losses are also eliminated unless the transaction provides evidence on impairment of the asset transferred. Where necessary, in applying the equity method, adjustments are made to the financial statements of joint ventures to ensure consistency of accounting policies with those of the Group.

In the Company’s separate financial statements, investments in joint ventures are stated at cost less impairment losses.

On disposal of such investments, the difference between net disposal proceeds and their carrying amounts is included in profit or loss.

(q) Intangible assets

(i) Contract rights

Contract rights comprise acquired contracts and rights to contracts from business combination. These are amortised over the contractual period on a straight-line basis and are assessed at each reporting date whether there is any indication that the contract rights may be impaired. See accounting policy Note 2(k) to the financial statements on impairment of non-financial assets.

(ii) Goodwill

Goodwill is initially measured at cost. Following the initial recognition, goodwill is measured at cost less accumulated impairment losses.

For the purpose of impairment testing, goodwill acquired is allocated, from the acquisition date, to each of the Group’s cash-generating units that are expected to benefit from the synergies of the combination.

The cash-generating unit to which goodwill has been allocated is tested for impairment annually and whenever there is an indication that the cash-generating unit may be impaired, by comparing the carrying amount of the cash-generating unit, including the allocated goodwill, with the recoverable amount of the cash-generating unit. Where the recoverable amount of the cash-generating unit is less than the carrying amount, an impairment loss is recognised in profit or loss. Impairment losses recognised for goodwill are not reversed in subsequent periods.

Where goodwill forms part of a cash-generating unit and part of the operation within that cash-generating unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relative fair values of the operations disposed of and the portion of the cash-generating unit retained.

127 YTL CORPORATION BERHAD

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(q) Intangible assets (cont’d.)

(iii) Others

a) Customer lists

Customer lists are amortised over the contractual period on a straight-line basis and are assessed at each reporting date whether there is any indication that the other intangible assets may be impaired. See accounting policy Note 2(k) to the financial statements on impairment of non-financial assets.

b) Quarry rights

Quarry rights are amortised on the straight-line basis over the lease term less impairment losses.

c) Emission rights

The emission rights that are acquired by the Group are measured at cost less any accumulated impairment losses.

The policy for the recognition and measurement of impairment losses is in accordance with Note 2(k).

(r) Financial assets

(i) Initial recognition and measurement

Financial assets are recognised in the Statements of Financial Position when, and only when, the Group and the Company become a party to the contractual provisions of the instrument.

Financial assets are classified, at initial recognition, and subsequently measured at amortised cost, fair value through other comprehensive income (“OCI”), or fair value through profit or loss.

The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Group’s and the Company’s business model for managing them. With the exception of trade receivables that do not contain a significant financing component or for which the Group and the Company have applied the practical expedient, the Group and the Company initially measure a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do not contain a significant financing component or for which the Group and the Company have applied the practical expedient are measured at the transaction price determined under MFRS 15.

In order for a financial asset to be classified and measured at amortised cost or FVOCI, it needs to give rise to cash flows that are solely payments of principal and interest (“SPPI”) on the principal amount outstanding. This assessment is referred as the SPPI test and is performed at an instrument level.

The Group’s and the Company’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both.

Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Group and the Company commits to purchase or sell the asset.

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Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(r) Financial assets (cont’d.)

(ii) Subsequent measurement

For purposes of subsequent measurement, financial assets are classified in four categories:

• Financial assets at amortised cost (debt instruments); • Financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments); • Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon derecognition (equity instruments); and • Financial assets at fair value through profit or loss.

a) Financial assets at amortised cost (debt instruments)

This category is the most relevant to the Group and the Company. The Group and the Company measures financial assets at amortised cost if both of the following conditions are met: – The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows; and – The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial assets at amortised cost are subsequently measured using the effective interest rate (“EIR”) method and are subject to impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired.

The Group’s and the Company’s financial assets at amortised cost include receivables and amounts due from associates and joint ventures included under other non-current financial assets.

b) Financial assets designated at fair value through OCI (equity instruments)

Upon initial recognition, the Group and the Company can elect to classify irrevocably its equity investments as equity instruments designated at fair value through OCI when they meet the definition of equity under MFRS 132 Financial Instruments: Presentation and are not held for trading. The classification is determined on an instrument- by-instrument basis.

Gains and losses on these financial assets are never recycled to profit or loss. Dividends are recognised as other income in the statement of profit or loss when the right of payment has been established, except when the Group and the Company benefits from such proceeds as a recovery of part of the cost of the financial asset, in which case, such gains are recorded in OCI. Equity instruments designated at fair value through OCI are not subject to impairment assessment.

The Group and the Company elected to classify irrevocably its non-listed equity investments under this category.

129 YTL CORPORATION BERHAD

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(r) Financial assets (cont’d.)

(ii) Subsequent measurement (cont’d.)

c) Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss include financial assets held for trading, financial assets designated upon initial recognition at fair value through profit or loss, or financial assets mandatory required to be measured at fair value. Financial assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. Derivatives, including separated embedded derivatives, are also classified as held for trading unless they are designated as effective hedging instruments. Financial assets with cash flows that are not solely payments of principal and interest are classified and measured at fair value through profit or loss, irrespective of the business model. Notwithstanding the criteria for debt instruments to be classified at amortised cost or at fair value through OCI, as described above, debt instruments may be designated at fair value through profit or loss on initial recognition if doing so eliminates, or significantly reduces, an accounting mismatch.

Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value with net changes in fair value recognised in the statement of profit or loss.

This category includes derivative instruments and listed equity investments which the Group and the Company had not irrevocably elected to classify at fair value through OCI. Dividends on equity investments are also recognised as other income in the statement of profit or loss when the right of payment has been established.

A derivative embedded in a hybrid contract, with a financial liability or non-financial host, is separated from the host and accounted for as a separate derivative if: the economic characteristics and risks are not closely related to the host; a separate instrument with the same terms as the embedded derivative would meet the definition of a derivative; and the hybrid contract is not measured at fair value through profit or loss. Embedded derivatives are measured at fair value with changes in fair value recognised in profit or loss. Reassessment only occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that would otherwise be required or a reclassification of a financial asset out of the fair value through profit or loss category.

A derivative embedded within a hybrid contract containing a financial asset host is not accounted for separately. The financial asset host together with the embedded derivative is required to be classified in its entirety as a financial asset at fair value through profit or loss.

(iii) Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e., removed from the statements of financial position) when: - The rights to receive cash flows from the asset have expired; or - The Group and the Company have transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group and the Company have transferred substantially all the risks and rewards of the asset, or (b) the Group and the Company have neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(r) Financial assets (cont’d.)

(iii) Derecognition (cont’d.)

When the Group and the Company have transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Group and the Company continues to recognise the transferred asset to the extent of its continuing involvement. In that case, the Group and the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group and the Company have retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group and the Company could be required to repay.

(s) Impairment of financial assets

The Group and the Company recognise an allowance for expected credit losses (“ECLs”) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group and the Company expect to receive, discounted at an approximation of the original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.

ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (“a 12-month ECL”). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (“a lifetime ECL”).

For trade receivables and contract assets, the Group and the Company applies a simplified approach in calculating ECLs. Therefore, the Group and the Company does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date. The Group and the Company has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.

The Group and the Company considers a financial asset in default when contractual payments are 90 days past due. However, in certain cases, the Group and the Company may also consider a financial asset to be in default when internal or external information indicates that the Group and the Company is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by the Group and the Company. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows.

Further disclosures relating to impairment of financial assets are also provided in the following notes:

Note

Trade and other receivables 20 Financial risk management 38

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(t) Contract costs assets

The Group capitalises sales commissions as costs to obtain a contract with a customer when they are incremental and expected to be recovered over more than a year. The Group expects to recover these costs in the future through telecommunication services revenue earned from the customer. The Group also capitalises the expenditure on assets such as water mains/sewers or new connections relating to contracts as they are incurred to fulfil the contract and are expected to be received over more than one year.

Sales commissions are amortised on a straight-line basis over the term of the specific contract to which the cost relates to. Amortisation of contract costs are included as part of direct cost within “Cost of sales” in the Income Statements. While, the expenditure on assets are treated as cost of sales when the contract is complete.

An impairment loss is recognised to profit or loss to the extent that the carrying amount of the contract cost assets recognised exceeds the remaining amount of consideration that the Group expects to receive for the specific contract that the cost relates to less additional costs required to complete the specific contract.

(u) Contract assets and liabilities

Contract asset is the right to consideration in exchange for goods and services that the Group has transferred to a customer. If the Group transfers goods or services to a customer before the customer pays consideration or before payment is due, a contract asset is recognised for the earned consideration that is conditional. Contract assets are subject to impairment assessment based on the ECL model.

Contract liability is the unsatisfied obligation by the Group to transfer goods or services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the Group transfers goods or services to the customer, a contract liability is recognised when the payment is made or the payment is due (whichever is earlier). Contract liabilities are recognised as revenue when the Group performs under the contract.

(v) Derivatives financial instruments and hedging activities

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. The method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. The Group designates certain derivatives as either: (i) Hedges of the fair value of recognised assets or liabilities or a firm commitment (fair value hedge); or (ii) Hedges of a particular risk associated with a recognised asset or liability or a highly probable forecast transaction (cash flow hedge); or (iii) Hedges of a net investment in a foreign operation.

The Group documents at the inception of the transaction the relationship between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking various hedging transactions. The Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flows of hedged items.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(v) Derivatives financial instruments and hedging activities (cont’d.)

The fair values of various derivative instruments used for hedging purposes are disclosed in Note 21. Movements on the hedging reserve in other comprehensive income are shown in Note 28. The full fair value of a hedging derivative is classified as a non- current asset or liability when the remaining hedged item is more than 12 months, and as a current asset or liability when the remaining maturity of the hedged item is less than 12 months. Trading derivatives are classified as a current asset or liability.

(i) Fair value hedge

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the profit or loss, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk. The Group only applies fair value hedge accounting for hedging fixed interest risk on borrowings. The gain or loss relating to the effective portion of interest rate swaps hedging fixed rate borrowings is recognised in profit or loss within ‘finance costs’. The gain or loss relating to the ineffective portion is recognised in profit or loss within ‘other gains/(losses) – net’. Changes in the fair value of the hedge fixed rate borrowings attributable to interest rate risk are recognised in profit or loss within ‘finance costs’.

If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item for which the effective interest method is used is amortised to profit or loss over the period to maturity.

(ii) Cash flow hedge

The fair value changes on the effective portion of the derivatives that are designated and qualify as cash flow hedges are recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in profit or loss.

Amounts accumulated in equity are reclassified to profit or loss in the financial periods when the hedged item affects profit or loss (for example, when the forecast sale that is hedged takes place). When the forecast transaction that is hedged results in the recognition of a non-financial asset (for example, inventory or fixed assets), the gains and losses previously deferred in equity are transferred from equity and included in the initial measurement of the cost of the asset. The deferred amounts are ultimately recognised in cost of goods sold in the case of inventory or in depreciation in the case of property, plant and equipment.

When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in the profit or loss. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to profit or loss.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(v) Derivatives financial instruments and hedging activities (cont’d.)

(iii) Hedges of net investment in foreign operations

The Group applies hedge accounting by designating a non-derivative financial liability as a hedge of a net investment in the foreign operation, with the corresponding foreign currency differences arising on the translation being reclassified to the Group’s foreign currency translation reserve. To the extent that the hedge is ineffective, such differences are recognised in the Income Statements. When the hedged net investment is disposed of, the relevant amount in the foreign currency translation reserve is transferred to the Income Statements return as part of the gain or loss on disposal.

The Group uses a loan as a hedge of its exposure to foreign exchange risk on its investments in foreign subsidiaries.

(w) Inventories

Inventories are stated at the lower of cost and net realisable value.

Cost is determined on the weighted average or first in, first out basis and includes the cost of purchase and other costs incurred in bringing the inventories to their present location and condition.

The cost of finished goods and work-in-progress consists of raw materials, direct labour, other direct charges and an appropriate proportion of production overheads (based on normal operating capacity).

Fuel and diesel oil held for generation of electricity are not written down below cost if the electricity generated is expected to obtain a gross margin at or above cost. Cost for this purpose includes the applicable costs required to enable the fuel and diesel oil to be used for the generation of electricity.

Inventories for oil trading are acquired with the purpose of selling in the near future and generating a profit from fluctuations in price. These are at fair value less costs to sell, with changes in fair value less costs to sell recognised in the Income Statements in the period of change.

The cost of developed properties comprises costs associated with the acquisition of land, direct costs and appropriate proportions of common costs.

Net realisable value is the estimated selling price in the ordinary course of business, less the costs of completion and applicable variable selling expenses.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(x) Property development costs

Property development costs comprise all costs that are directly attributable to development activities or that can be allocated on a reasonable basis to such activities. Property development costs are recognised when incurred.

When the financial outcome of the development activity can be reliably estimated and the sale of the development unit is affected, property development revenue and expenses are recognised in profit or loss by reference to the stage of completion of development activities at the reporting date in accordance with MFRS 15: Revenue from Contracts with Customers. The stage of completion is determined by the proportion that property development costs incurred for work performed to date to the estimated total property development costs.

Where the financial outcome of a development activity cannot be reliably estimated, property development revenue is recognised only to the extent of property development costs incurred that is probable will be recoverable, and property development costs on properties sold are recognised as an expense in the period in which they are incurred.

Any expected loss on a development project, including costs to be incurred over the defects liability period, is recognised as an expense immediately.

Property development costs not recognised as an expense are recognised as an asset, which is measured at the lower of cost and net realisable value.

Where revenue recognised in the profit or loss exceed billings to purchasers, the balance is shown as contract assets (within current assets). Where billings to purchasers exceed revenue recognised in the profit or loss, the balance is shown as contract liabilities (within current liabilities).

(y) Cash and cash equivalents

Cash and cash equivalents consist of cash and bank balances, bank overdrafts, deposits held at call with financial institutions and highly liquid investments which have an insignificant risk of changes in value. For the purpose of the Statements of Cash Flows, cash and cash equivalents are presented net of bank overdrafts.

(z) Share capital

Ordinary shares are equity instruments and recorded at the proceeds received, net of directly attributable incremental transaction costs.

Dividends on ordinary shares are accounted for in shareholders’ equity as an appropriation of retained earnings and accrued as liability in the financial year in which the obligation to pay is established.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(aa) Treasury shares

Where the Company purchases its own shares, the consideration paid, including any directly attributable incremental costs, net of tax, is deducted from equity attributable to the owners of the Company as treasury shares until the shares are cancelled, reissued.

Should such shares be cancelled, the costs of the treasury shares are applied in the reduction of the profits otherwise available for distribution as dividends. Should such shares are subsequently reissued, any consideration received, net of any directly attributable incremental transaction costs and the related tax effects, is included in equity attributable to the owners of the Company.

Where the treasury shares are subsequently distributed as dividends to shareholders, the costs of the treasury shares on the original purchase are applied in the reduction of the funds otherwise available for distribution as dividends.

(ab) Irredeemable Convertible Unsecured Loan Stocks (“ICULS”)

The ICULS are regarded as compound instruments, consisting of a liability component and an equity component. At the date of issue, the fair value of the liability component is estimated using the prevailing market interest rate for a similar instrument. The difference between the proceeds of issue of the ICULS and the fair value assigned to the liability component, representing the conversion option is included in equity. The liability component is subsequently stated at amortised cost using the effective interest rate method until extinguished on conversion or cancellation, whilst the value of the equity component is not adjusted in subsequent periods. Attributable transaction costs are apportioned and deducted directly from the liability and equity components based on their carrying amounts at the date of issue.

Under the effective interest rate method, the interest expense on the liability component is calculated by applying the prevailing market interest rate for a similar non-convertible instrument at the date of issue. The difference between this amount and the interest paid is added to the carrying amount of the ICULS.

The value of the conversion option is not adjusted in subsequent periods, except in times of ICULS conversion into ordinary shares. Upon conversion of the instrument into ordinary shares, the amount credited to share capital is the aggregate of the amounts classified within liability and equity at the time of conversion. No gain or loss is recognised in profit or loss.

(ac) Deferred income

The deferred income is in relation to assets transferred from customers in respect of services which are yet to be provided. Such amounts are recorded as liabilities in the Statements of Financial Position and are amortised to the Income Statements over the expected useful economic lives of the related assets.

(ad) Bonds and borrowings

Bonds and borrowings are initially recognised based on the proceeds received, net of transaction costs incurred. Subsequently, bonds and borrowings are stated at amortised cost using the effective yield method; any difference between proceeds (net of transaction costs) and the redemption value is recognised in the profit or loss over the period of the bonds and borrowings.

Interest relating to a financial instrument classified as a liability is reported within finance cost in the Income Statements.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(ad) Bonds and borrowings (cont’d.)

Bonds and borrowings are classified as current liabilities unless the Group and the Company have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

Borrowing cost incurred to finance the construction of property, plant and equipment that meets the definition of qualifying asset are capitalised as part of the cost of the assets during the period of time that is required to get the asset ready for its intended use.

(ae) Leases

(i) Accounting as lessee

Leases are recognised as right-of-use (‘ROU’) assets and a corresponding liability at the date on which the leased asset is available for use by the Group and the Company (i.e. the commencement date).

Contracts may contain both lease and non-lease components. The Group and the Company allocates the consideration in the contract to the lease and non-lease components based on their relative stand-alone prices. However, for leases of properties for which the Group and the Company are a lessee, it has elected the practical expedient provided in MFRS 16 not to separate lease and non-lease components. Both components are accounted for as a single lease component and payments for both components are included in the measurement of lease liability.

a) Lease term

In determining the lease term, the Group and the Company considers all facts and circumstances that create an economic incentive to exercise an extension option, or not to exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not to be terminated).

The Group and the Company reassess the lease term upon the occurrence of a significant event or change in circumstances that is within the control of the Group and the Company and affects whether the Group and the Company are reasonably certain to exercise an option not previously included in the determination of lease term, or not to exercise an option previously included in the determination of lease term. A revision in lease term results in remeasurement of the lease liabilities. See accounting policy 2(ae)i)d)) on reassessment of lease liabilities.

b) ROU assets

ROU assets are initially measured at cost comprising the following: • The amount of the initial measurement of lease liability; • Any lease payments made at or before the commencement date less any lease incentive received; • Any initial direct costs; and • Decommissioning or restoration costs.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(ae) Leases (cont’d.)

(i) Accounting as lessee (cont’d.)

b) ROU assets (cont’d.)

ROU assets that are not investment properties are subsequently measured at cost, less accumulated depreciation and impairment loss (if any). The ROU assets are generally depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis. If the Group and the Company are reasonably certain to exercise a purchase option, the ROU assets are depreciated over the underlying asset’s useful life. In addition, the ROU assets are adjusted for certain measurement of the lease liabilities.

The Group and the Company presents ROU assets within which the corresponding underlying assets would be presented if they were owned, those assets are presented in the Statements of Financial Position as property, plant and equipment. ROU assets are presented as a seperate line item in the Statements of Financial Position except for above.

c) Lease liabilities

Lease liabilities are initially measured at the present value of the payments that are not paid at that date. The lease payments include the following: • Fixed payments (including in-substance fixed payments), less any lease incentive receivable; • Variable lease payments that are based on an index or a rate, initially measured using the index or rate at the commencement date; • The exercise price of a purchase and extension option if the Group and the Company are reasonably certain to exercise that options; and • Payments of penalties for terminating the lease, if the lease term reflects the Group and the Company exercising that option.

Lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases in the Group and the Company, the lessee’s incremental borrowing is used. This is the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the ROU in a similar economic environment with similar term, security and conditions.

Lease payments are allocated between principal and finance cost. The finance cost is charged to Income Statements over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

Variable lease payment that depend on sales are recognised in the statement of comprehensive income in the period in which the condition that triggers those payments occurs.

The Group and the Company presents lease liabilities as a separate line item in the statement of financial position. Interest expense on the lease liability is presented within the finance cost in the profit or loss.

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Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(ae) Leases (cont’d.)

(i) Accounting as lessee (cont’d.)

d) Reassessment of lease liabilities

The Group and the Company are also exposed to potential future increases in variable lease payments that depend on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect, the lease liability is remeasured and adjusted against the ROU assets.

Lease liabilities is also remeasured if there is a change in the Group’s and the Company’s assessment of whether it will exercise an extension option and there are modifications in the scope or the consideration of the lease that was not part of the original term.

e) Short-term leases and leases of low value assets

Short-term leases are leases with a lease term of 12 months or less. Low-value assets comprise IT equipment and small items of office furniture. Payments associated with short-term leases of equipment and all leases of low- value assets are recognised on a straight-line bases as an expense in Income Statements.

(ii) Accounting by lessor

As a lessor, the Group and the Company determine at lease inception whether each lease is a finance lease or an operating lease. To classify each lease, the Group and the Company make an overall assessment of whether the lease transfers substantially all of the risks and rewards incidental to the ownership of the underlying asset to the lessee. As part of this assessment, the Group and the Company consider certain indicators such as whether the lease is for the major part of the economic life of the asset.

a) Finance leases

The Group and the Company classifies a lease as a finance lease if the lease transfers substantially all the risks and rewards incidental to ownership of an underlying asset to the lessee.

The Group derecognises the underlying asset and recognises a receivable at an amount equal to the net investment in a finance lease. Net investment in a finance lease is measured at an amount equal to the sum of the present value of lease payments from lessee and the unguaranteed residual value of the underlying asset. Initial direct costs are also included in the initial measurement of the net investment. The net investments is subject to MFRS 9 impairment (refer to Note 2(s) on impairment of financial assets). In addition, the Group reviews regularly the estimated unguaranteed residual value.

Lease income is recognised over the term of the lease using the net investment method so as to reflect a constant periodic rate of return. The Group revises the lease income allocation if there is a reduction in the estimated unguaranteed residual value.

139 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(ae) Leases (cont’d.)

(ii) Accounting by lessor (cont’d.)

b) Operating leases

The Group classifies a lease as an operating lease if the lease does not transfer substantially all the risks and rewards incidental to ownership of an underlying asset to the lessee.

The Group recognises lease payments received under operating lease as lease income on a straight-line basis over the lease term.

Rental income on operating leases is recognised over the term of the lease on a straight-line basis. Rental income is shown net of rebates and discounts. Rental income includes base rent, percentage rent and other rent related income from tenants. Base rent is recognised on a straight-line basis over the lease term. Percentage rent is recognised based on sales reported by tenants. When the Group provide incentives or rebates to the tenants, the cost of incentives or rebates is capitalised as deferred lease incentive and is recognised over the lease term, on a straight-line basis, as a reduction of rental income. Initial direct cost incurred by the Group in negotiating and arranging an operating lease is recognised as an asset (deferred lease incentive) and amortised over the lease term on the same basis as the rental income.

c) Sublease classification

Until the financial year ended 30 June 2019, when the Group was an intermediate lessor, the subleases were classified as finance or operating leases by reference to the underlying assets.

From 1 July 2019, when the Group is an intermediate lessor, it assesses the lease classification of a sublease with reference to the ROU asset arising from the head lease, not with reference to the underlying asset. If a head lease is short-term lease to which the Group and the Company applies the exemption described above, then it classifies the sublease as an operating lease.

d) Separating lease and non-lease components

If an arrangement contains lease and non-lease components, the Group and the Company allocates the consideration in the contract to the lease and non-lease components based on the stand-alone selling prices in accordance with the principles in MFRS 15.

(af) Grants and contributions

Grants and contributions are benefits received in respect of specific qualifying expenditure, and investment tax credits and tax benefits in respect of qualifying property, plant and equipment. These are released to the profit or loss over the expected economic useful lives of the related assets.

(ag) Provisions

The Group recognises provisions when it has a present legal or constructive obligation arising as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made. The recording of provisions requires the application of judgements about the ultimate resolution of these obligations. As a result, provisions are reviewed at each reporting date and adjusted to reflect the Group’s current best estimate.

140 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(ah) Financial liabilities

(i) Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss or at amortised cost, as appropriate.

The Group’s and the Company’s financial liabilities include trade and other payables, amounts due to related parties, bonds and borrowings and derivative financial instruments.

(ii) Subsequent measurement

The measurement of financial liabilities depends on their classification, as described below:

a) Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss.

Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the Company that are not designated as hedging instruments in hedge relationships as defined by MFRS 9. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.

Gains or losses on liabilities held for trading are recognised in the profit or loss.

Financial liabilities designated upon initial recognition at fair value through profit or loss are designated at the initial date of recognition, and only if the criteria in MFRS 9 are satisfied. The Group and the Company have not designated any financial liability as at fair value through profit or loss.

b) Financial liabilities at amortised cost

This is the category most relevant to the Group and the Company. After initial recognition, all financial liabilities are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the of profit or loss.

(iii) Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the profit or loss.

141 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(ai) Foreign currency

(i) Functional and presentation currency

Items included in the financial statements of the Group are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The consolidated financial statements are presented in Ringgit Malaysia (RM), which is also the Company’s functional and presentation currency.

(ii) Foreign currency transactions

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the profit or loss.

(iii) Group companies

The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into presentation currency as follows: • assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position; • income and expenses for each income statements are translated at average exchange rates; and • all resulting exchange differences are recognised as separate components of other comprehensive income.

On consolidation, exchange differences arising from the translation of the net investment in foreign operations are taken to shareholders’ equity. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in equity are recognised in the profit or loss as part of the gain or loss on disposal.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity on or after 1 July 2011 are treated as assets and liabilities of the foreign entity and translated at the closing rate. For acquisition of foreign entities completed prior to 1 July 2011, goodwill and fair value adjustments continued to be recorded at the exchange rate at the respective date of acquisitions. This is in accordance to the adoption of MFRS 1.

(aj) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision- maker who is responsible for allocating resources and assessing performance of the operating segments.

(ak) Financial guarantee

Financial guarantee contracts are contracts that require the Group and the Company to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payments when due, in accordance with the terms of a debt instrument.

142 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)

(ak) Financial guarantee (cont’d.)

Financial guarantee contracts are recognised as a financial liability at the time the guarantee is issued. The liability is initially measured at fair value and subsequently measured at the higher of the amount determined in accordance with the expected credit loss model under MFRS 9 ‘Financial instruments’ and the amount initially recognised less cumulative amount of income recognised in accordance with the principles of MFRS 15 ‘Revenue from Contracts with Customers’, where appropriate.

The fair value of financial guarantees is determined as the present value of the difference in net cash flows between the contractual payments under the debt instrument and the payments that would be required without the guarantee, or the estimated amount that would be payable to a third party for assuming the obligations.

Where financial guarantees in relation to loans or payables of subsidiaries are provided by the Company for no compensation, the fair values are accounted for as contributions and recognised as part of the cost of investment in subsidiaries.

(al) Contingent liabilities and contingent assets

The Group and the Company do not recognise a contingent liability but disclose its existence in the financial statements, except in a business combination.

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by uncertain future events beyond the control of the Group and the Company or a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle the obligation. When a change in the probability of an outflow of economic resources occurs and the outflow is probable, it will then be recognised as a provision.

A contingent asset is a possible asset that arises from past events whose existence will be confirmed by uncertain future events beyond the control of the Group and the Company. The Group and the Company do not recognise contingent assets but disclose their existence where inflows of economic benefits are probable, but not virtually certain. When inflow of economic resources is virtually certain, the asset is recognised.

In the acquisition of subsidiaries by the Group under a business combination, the contingent liabilities assumed are measured initially at their fair value at the acquisition date, irrespective of the extent of any non-controlling interests.

The Group recognises separately the contingent liabilities of the acquirees as part of allocating the cost of a business combination where the fair values can be measured reliably. Where the fair values cannot be measured reliably, the resulting effect will be reflected in the goodwill arising from the acquisitions.

(am) Offsetting financial instruments

Financial assets and liabilities are offset and the net amount presented in the Statements of Financial Position when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy.

143 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The Group and the Company make estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, rarely equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below:

(a) Estimated assessment of goodwill

The Group tests goodwill for impairment annually, in accordance with its accounting policy. The recoverable amounts of cash generating units have been determined based on either value-in-use or fair value less costs to sell calculations. These calculations require the use of estimates as set out in Note 19 to the financial statements.

Management has factored in the potential impact with respect to the Covid-19 outbreak within the impairment assessments based on the best estimate on the trajectory of recovery from the Covid-19 outbreak. Significant judgement is involved as there may be potential uncertainties on the full extent of impact as a result of Covid-19.

(b) Capitalisation policy of property, plant and equipment on infrastructure assets

The infrastructure assets of the water and sewerage segment comprised cost incurred to meet the development and regulatory requirement of the business and this includes employee and overhead costs that are directly attributable to the construction of the asset.

Estimates and judgements are involved in determining whether cost incurred, specifically employee and overhead costs, meet the relevant criteria for capitalisation of property, plant and equipment.

(c) Estimated impairment of property, plant and equipment

Determining whether the property, plant and equipment are impaired requires an estimation of value in use of the property, plant and equipment. The value in use calculation requires the management to estimate the future cash flows and an appropriate discount rate in order to calculate the present value of future cash flows. The management has evaluated such estimates and is confident that no allowance for impairment is necessary.

The Group management follows its accounting policy set out in Note 2(k) in determining when property, plant and equipment are considered impaired.

Impairment is recognised when events and circumstances indicate that these assets may be impaired and the carrying amount of these assets exceeds the recoverable amounts. In determining the recoverable amount of these assets, certain estimates regarding the cash flows of these assets are made.

(d) Assessment on allowance for impairment of trade receivables of water and sewerage

The expected credit loss on outstanding receivables is a key estimate under MFRS 9. The Group estimate of recoverability by grouping customers into similar economic profiles and applying a percentage loss rate based on forward looking judgements on the future collection rates that are likely to be achieved. In particular for the financial year ended 30 June 2020, this has included additional considerations of the possible impact of the Covid-19 pandemic on the expected collection rates of outstanding receivables.

144 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONT’D.)

(e) Estimated useful lives of property, plant and equipment (“PPE”)

The Group reviews the useful lives of its PPE at each reporting date and any adjustments are made on a prospective basis as changes in accounting estimates. The useful lives of the telecommunications equipment are assessed periodically based on the conditions of the equipment, market conditions and other regulatory requirements. During the financial year, the Group has reviewed the operational conditions of the equipment in telecommunications business segment and revised the estimated useful lives of certain telecommunications equipment from 7-25 years to 10-30 years with effect from 1 July 2019 to better reflect the economic useful lives.

(f) Fair value estimates for investment properties

The Group carries investment properties at fair value, which requires extensive use of accounting estimates and judgements. While significant components of fair value measurement were determined using verifiable objective evidence, the amount of changes in fair value would differ if the Group uses different valuation methodologies. Any changes in fair value of these investment properties would affect income statement.

(g) Assessment of lower of cost and net realisable value

The Group recognises inventories at lower of cost and net realisable value.

Significant judgement is required in determining the net realisable value which is the estimated selling price in ordinary course of business less the estimated cost to sale.

(h) Assumptions used in determining the post-employment benefit obligations

The present value of the post-employment benefit obligations depends on a number of factors that are determined on an actuarial basis using a number of assumptions. The assumptions used in determining the net cost/income are disclosed in Note 35 to the financial statements. Any changes in these assumptions will impact the carrying amount of pension obligations.

(i) Control over Starhill Global Real Investment Trust (“SGREIT”)

The Group has approximately 36.74% (2019: 36.46%) gross ownership interest of units in (“SGREIT”) as at 30 June 2020. (“SGREIT”) is managed by YTL Starhill Global REIT Management Ltd (“YTLSGM”), a wholly-owned subsidiary of the Group. Since April 2020, the Group has provided an undertaking to the trustee of (“SGREIT”) to grant the other unitholders the right to endorse or re-endorse the appointment of directors of YTLSGM at the annual general meetings of (“SGREIT”). The Group has determined that it does not have control over (“SGREIT”) but continues to have significant influence over the investment.

(j) Construction contracts

The Group has significant ongoing construction contracts. For these construction contracts, revenue is recognised over time by reference to the Group’s progress towards completing the construction. The measure of progress is determined based on the proportion of contract costs incurred to date to the estimated total contract costs (“input method”).

Management has to estimate the total contract costs to complete, which are used in the input method to determine the Group’s recognition of construction revenue. When it is probable that the total contract costs will exceed the total construction revenue, a provision for onerous contracts is recognised immediately.

145 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONT’D.)

(j) Construction contracts (cont’d.)

Significant judgement is used to estimate these total contract costs to complete. In making these estimates, management has relied on the expertise of the internal experts to determine the progress of the construction and also on past experience of completed projects.

(k) Revenue recognition from accrued income

The unbilled income accrual from metered water services of the water and sewerage segment requires an estimation of the amount of unbilled charges at the period end. This is calculated using system generated information based on previous customer volume usage.

(l) Leases

The measurement of the “right-of-use” assets and lease liability for leases where the Group is a lessee requires the use of significant judgements and assumptions, such as lease term and incremental borrowing rate.

In determining the lease term, the Group and the Company consider all facts and circumstances that create an economic incentive to exercise an extension option, or not to exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated).

The lease term is reassessed if an option is exercised (or not exercised) or the Group and the Company become obligated to exercise (not to exercise) it. The assessment of reasonable certainty is only revised if a significant event or a significant change in circumstances occurred, which affect this assessment, and that is within the control of the lessee.

In determining the incremental borrowing rate, the Group and the Company first determine the closest borrowing rate before using significant judgement to determine the adjustments required to reflect the term, security, value or economic environment of the respective leases.

4. REVENUE

Group Company

2020 2019 2020 2019 RM'000 RM'000 RM'000 RM'000

Revenue comprise the following: Revenue from contracts with customers 18,504,298 17,153,379 260 291 Revenue from other sources 674,151 894,149 415,071 548,325

Total revenue 19,178,449 18,047,528 415,331 548,616

146 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

4. REVENUE (CONT’D.)

(a) Disaggregation of revenue from contracts with customers and other sources:

Group Company

2020 2019 2020 2019 RM'000 RM'000 RM'000 RM'000

Utilities Sale of electricity 5,837,626 6,705,782 – – Sale of clean water, treatment and disposal of waste water 3,479,290 3,432,281 – – Sale of steam 171,900 211,048 – – Broadband and telecommunications revenue 396,858 863,289 – – Others 389,427 154,832 – –

10,275,101 11,367,232 – –

Cement manufacturing & trading Sale of cement and related products 4,077,724 2,655,217 – – Others 14,479 19,035 – –

4,092,203 2,674,252 – –

Construction Construction contracts revenue 2,316,005 1,219,499 – –

Hotel operations Hotel room and food and beverages 1,113,986 1,198,333 – – Others 18,529 27,292 – –

1,132,515 1,225,625 – –

Property Property development and sales of completed properties 478,046 435,872 – – Sale of land held for property development – 9,050 – – Others 17,213 19,546 – –

495,259 464,468 – –

Information technology & e-commerce related business Media and advertising services 3,500 3,669 – – Others 41 153 – –

3,541 3,822 – –

147 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

4. REVENUE (CONT’D.)

(a) Disaggregation of revenue from contracts with customers and other sources: (cont’d.)

Group Company

2020 2019 2020 2019 RM'000 RM'000 RM'000 RM'000

Management services & others Operation and maintenance services 139,023 144,529 – – Food and beverages operations 14,659 26,923 – – Others 35,992 27,029 260 291

189,674 198,481 260 291

18,504,298 17,153,379 260 291

Revenue from other sources Rental income 481,471 639,938 – – Interest income 183,887 224,804 43,200 61,056 Dividend income 8,793 29,407 371,871 487,269

674,151 894,149 415,071 548,325

Total revenue 19,178,449 18,047,528 415,331 548,616

(b) Timing of revenue recognition for revenue from contracts with customers:

Group Company

2020 2019 2020 2019 RM'000 RM'000 RM'000 RM'000

– at a point in time 7,819,342 8,681,719 – – – over time 10,684,956 8,471,660 260 291

18,504,298 17,153,379 260 291 .

148 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

5. COST OF SALES

Included in cost of sales are the following:

Group

2020 2019 RM’000 RM’000

Cost of inventories 3,011,036 2,043,891 Construction contracts costs 2,061,477 1,047,401 Cost of fuel, raw materials and consumable 5,996,783 6,843,189 Property development costs 7,322 17,423

6. FINANCE COSTS

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Interest expense – Bonds 874,796 896,991 116,028 115,070 – Borrowings 946,231 852,637 55,563 60,880 – Lease liabilities 47,286 – 295 – – Post–employment benefit obligations 15,894 18,682 – –

1,884,207 1,768,310 171,886 175,950 Less: Amounts capitalised in – Property development costs 23 (4,906) (12,463) – – – Property, plant and equipment 11 (18,554) (8,348) – –

Interest expense of financial liabilities carried at amortised cost 1,860,747 1,747,499 171,886 175,950

149 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

7. PROFIT BEFORE TAX

Group Company 2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Profit before tax is stated after charging (other than those disclosed in Note 5 & 6 to the Financial Statements): Amortisation of contract costs 24 7,842 11,569 – – Amortisation of intangible assets 19 69,606 10,806 – – Auditors’ remuneration – statutory audit – current financial year 10,029 10,098 244 244 – under provision in prior financial year 87 54 – 4 – others 1,601 727 16 14 Bad debts written off – receivables 10,901 5,552 – – Cash flow hedges, reclassified from hedging reserve to cost of sales 154,819 (144,316) – – Depreciation of property, plant and equipment 11 1,554,423 1,497,585 809 889 Depreciation of right-of-use assets 12 193,895 – 4,535 – Directors’ remuneration – emoluments 57,993 73,308 6,102 4,896 – fees 1,821 2,423 822 848 – benefits-in-kind 1,106 587 – – Hedge ineffectiveness recognised in profit or loss 16,210 – – – Hiring of plant and machinery – 15,059 – – Impairment losses on – amount due from related parties 38(e) 100 34 – – – development expenditures 14 – 1,080 – – – goodwill 19 1,723 – – – – receivables – net of reversal 38(e) 153,645 155,134 – – – investment in associates 1,135 – – – – investment in joint venture 17 898 – – – – property, plant and equipment 11 28,958 4,347 – – Investment properties written off 13 7,675 – – – Inventories written down 44,656 77,662 – – Lease expense not recognised in lease liabilities – short-term lease 84,967 – 634 – – low value assets 8,683 – – – Loss on foreign exchange – net – realised 27,502 23,620 – – – unrealised 28,433 12,360 – – Net fair value loss on derivatives 20,122 36,074 – – Property, plant and equipment written off 11 51,896 26,793 – – (Write back of)/Provision for liabilities and charges 36 (4,437) 7,520 – – Rental of land and buildings – 188,442 – 931

150 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

7. PROFIT BEFORE TAX (CONT’D.)

Group Company 2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

And crediting (other than those disclosed in Note 4 to the Financial Statements): Adjustment on fair value of investment properties 13 (12,808) 13,172 – – Amortisation of deferred income 5,209 4,579 – – Amortisation of grants and contributions 33 15,166 15,973 – – Bad debts recovered 2,949 4,187 – – Gain on derecognition of subsidiary 258,506 – – – Gain/(loss) on disposal of – investments – net 1,172 – – – – investment properties – 3,709 – – – property, plant and equipment 18,739 4,820 – (72) Gain on foreign exchange – net – realised 3,281 6,868 366 1,983 – unrealised 124,485 121,930 – – Gross dividend from quoted investments, within Malaysia 1,290 4 – – Hiring income from plant, machinery and equipment 26,947 29,916 – – Interest income from financial assets measured at amortised cost – fixed deposits 91,170 82,582 – – – others 4,015 4,134 – – Interest income – net investment in lease 746 – – – Liquidated assets damages income – 29,243 – – Net fair value gain on derivatives 3,357 16,093 – – Net fair value gain on investments 18 25,976 62,507 823 1,288 Operating lease income 139,548 – – – Rental income – other properties 10,166 11,657 – – Write back of impairment loss on – property, plant and equipment 11 – 1,024 – – – contract assets 38(e) 278 57 – – – development expenditures 14 2,978 – – –

151 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

7. PROFIT BEFORE TAX (CONT’D.)

Directors’ remuneration

Details of the total remuneration of each Director of the Company received from YTL Corporation Berhad Group of Companies, categorised into appropriate components are as follows:

Estimated Defined Share- money value contribution based of benefits- Fees Salaries Bonus plan payments Others in-kind Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020

Executive Directors Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 289 10,969 2,477 1,090 1,114 2 148 16,089 Dato’ Yeoh Seok Kian 182 4,969 1,521 632 1,114 2 679 9,099 Dato’ Yeoh Soo Min – 3,681 1,244 547 1,114 1 36 6,623 Dato’ Yeoh Seok Hong – 3,913 1,331 585 1,114 2 37 6,982 Dato’ Sri Michael Yeoh Sock Siong – 4,100 1,333 596 1,114 2 56 7,201 Dato’ Yeoh Soo Keng – 3,232 1,212 533 1,114 1 29 6,121 Dato’ Mark Yeoh Seok Kah – 3,523 1,184 521 1,114 3 41 6,386 Syed Abdullah Bin Syed Abd. Kadir – 648 120 31 111 1 80 991

Non-Executive Directors Dato’ Chong Keap Thai @ Cheong Keap Tai 328 – – – – 23 – 351 Dato’ Ahmad Fuaad Bin Mohd Dahalan 410 – – – – 21 – 431 Faiz Bin Ishak 439 – – – – 27 – 466 Raja Noorma Binti Raja Othman 173 – – – – 7 – 180

1,821 35,035 10,422 4,535 7,909 92 1,106 60,920

152 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

7. PROFIT BEFORE TAX (CONT’D.)

Directors’ remuneration (cont’d.)

Estimated Defined Share- money value contribution based of benefits- Fees Salaries Bonus plan payments in-kind Others Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Company – 2020

Executive Directors Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE – – – – 667 – – 667 Dato’ Yeoh Seok Kian – 812 305 134 667 70 – 1,988 Dato’ Yeoh Soo Min – – – – 667 – – 667 Dato’ Yeoh Seok Hong – – – – 667 – – 667 Dato’ Sri Michael Yeoh Sock Siong – – – – 667 – – 667 Dato’ Yeoh Soo Keng – – – – 667 – – 667 Dato’ Mark Yeoh Seok Kah – – – – 667 – – 667 Syed Abdullah Bin Syed Abd. Kadir – – – – 66 – – 66

Non–Executive Directors Dato’ Chong Keap Thai @ Cheong Keap Tai 220 – – – – – 14 234 Dato’ Ahmad Fuaad Bin Mohd Dahalan 210 – – – – – 12 222 Faiz Bin Ishak 219 – – – – – 13 232 Raja Noorma Binti Raja Othman 173 – – – – – 7 180

822 812 305 134 4,735 70 46 6,924

153 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

7. PROFIT BEFORE TAX (CONT’D.)

Directors’ remuneration (cont’d.)

Estimated Defined Share- money value contribution based of benefits- Fees Salaries Bonus plan payments Others in-kind Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2019

Executive Directors Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE 306 14,265 2,477 1,486 1,114 2 184 19,834 Dato’ Yeoh Seok Kian 193 6,987 1,521 924 1,114 4 113 10,856 Dato’ Yeoh Soo Min – 5,341 1,244 746 1,114 1 43 8,489 Dato’ Yeoh Seok Hong – 5,685 1,331 798 1,114 1 69 8,998 Dato’ Sri Michael Yeoh Sock Siong – 5,822 1,272 792 1,114 2 54 9,056 Dato’ Yeoh Soo Keng – 4,848 1,212 727 1,114 2 31 7,934 Dato’ Mark Yeoh Seok Kah – 5,099 1,184 710 1,114 3 13 8,123 Syed Abdullah Bin Syed Abd. Kadir – 648 120 42 111 1 80 1,002

Non-Executive Directors Eu Peng Meng @ Leslie Eu 647 – – – – 30 – 677 Dato’ Chong Keap Thai @ Cheong Keap Tai 440 – – – – 29 – 469 Dato’ Ahmad Fuaad Bin Mohd Dahalan 410 – – – – 24 – 434 Faiz Bin Ishak 427 – – – – 19 – 446

2,423 48,695 10,361 6,225 7,909 118 587 76,318

154 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

7. PROFIT BEFORE TAX (CONT’D.)

Directors’ remuneration (cont’d.)

Estimated Defined Share- money value contribution based of benefits- Fees Salaries Bonus plan payments in-kind Others Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Company – 2019

Executive Directors Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, KBE, CBE, FICE – – – – 667 – – 667 Dato’ Yeoh Seok Kian – 100 – 12 667 – – 779 Dato’ Yeoh Soo Min – – – – 667 – – 667 Dato’ Yeoh Seok Hong – – – – 667 – – 667 Dato’ Sri Michael Yeoh Sock Siong – – – – 667 – – 667 Dato’ Yeoh Soo Keng – – – – 667 – – 667 Dato’ Mark Yeoh Seok Kah – – – – 667 – – 667 Syed Abdullah Bin Syed Abd. Kadir – – – – 66 – – 66

Non–Executive Directors Eu Peng Meng @ Leslie Eu 208 – – – – – 13 221 Dato’ Chong Keap Thai @ Cheong Keap Tai 220 – – – – – 15 235 Dato’ Ahmad Fuaad Bin Mohd Dahalan 210 – – – – – 13 223 Faiz Bin Ishak 210 – – – – – 8 218

848 100 – 12 4,735 – 49 5,744

155 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

7. PROFIT BEFORE TAX (CONT’D.)

Employee benefits expenses

Group Company

2020 2019 2020 2019 RM'000 RM'000 RM'000 RM'000

Employees compensation (excluding Directors’ remuneration) Wages, salaries and bonus 1,222,551 1,166,520 20,577 18,188 Defined contribution plan 124,950 79,867 2,306 2,117 Defined benefit plan 43,824 64,699 – – Share option expenses 14,557 14,944 1,922 1,932 Other benefits 34,647 28,907 1,406 1,190

1,440,529 1,354,937 26,211 23,427

8. INCOME TAX EXPENSE

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Current income tax – Malaysian income tax 130,626 159,742 6,462 16,802 – Foreign income tax 139,452 146,015 – – Deferred tax 34 144,558 9,395 – –

414,636 315,152 6,462 16,802

Current income tax – Current financial year 319,075 307,876 9,851 18,980 – Over provision in prior financial years (48,997) (2,119) (3,389) (2,178)

Deferred tax – Relating to origination and reversal of temporary differences 144,558 9,395 – –

414,636 315,152 6,462 16,802

156 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

8. INCOME TAX EXPENSE (CONT’D.)

A reconciliation of income tax expense applicable to profit before tax at the statutory income tax rate to income tax expense at the effective income tax rate of the Group and the Company is as follows:

Group Company

2020 2019 2020 2019 RM'000 RM'000 RM'000 RM'000

Profit before tax 419,294 1,036,507 176,055 315,250

Taxation at Malaysian statutory tax rate of 24% (2019: 24%) 100,631 248,762 42,253 75,660 Non–deductible expenses 379,548 340,440 57,390 58,031 Income not subject to tax (128,308) (165,548) (89,792) (114,711) Different tax rates in other countries including re-measuring of deferred tax* 158,866 (30,647) – – Double deductible expenses (974) (3,467) – – Over provision in prior years (48,997) (2,119) (3,389) (2,178) Tax effect on share of profits of associated companies and joint ventures (61,728) (98,663) – – Tax effect of over provision of deferred tax 362 2,036 – – Tax effect of recognised deferred tax assets 15,236 24,358 – –

Income tax expense recognised in profit or loss 414,636 315,152 6,462 16,802

* The re-measurement of deferred tax during the financial year of RM162.4 million in respect of a subsidiary was due to an increase in the United Kingdom corporation tax rate from 17% to 19% (effective from 1 April 2020) following the March 2020 Budget in United Kingdom. This reduction will increase the subsidiary’s future current tax charge accordingly. The deferred tax liability at 30 June 2020 has been calculated based on the rate of 19% substantively enacted at the financial year ended 30 June 2020.

157 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

9. (LOSS)/EARNINGS PER SHARE (“EPS”)

Basic/diluted EPS

Basic EPS of the Group is calculated by dividing the profit for the year attributable to owners of the parent by the weighted average number of ordinary shares in issue during the financial year.

Group

2020 2019

(Loss)/Profit for the financial year attributable to owners of the parent (RM’000) (189,221) 242,589

Weighted average number of ordinary shares in issue for basic EPS (’000) 10,648,839 10,569,956

Basic/diluted EPS (sen) (1.78) 2.30

119,495,000 (2019: 120,900,000) share options granted to employees under ESOS have not been included in the calculation of diluted earnings per share because they are anti-dilutive.

10. DIVIDENDS

Group/Company

2020 2019

Gross Amount of Gross Amount of dividend dividend, dividend dividend, per share net of tax per share net of tax (sen) RM’000 (sen) RM’000

Dividend paid in respect of financial year ended 30 June 2019: Interim dividend of 4 sen per ordinary share paid on 13 November 2019 4.0 426,770 – –

Dividend paid in respect of financial year ended 30 June 2018: Interim dividend of 4 sen per ordinary share paid on 13 November 2018 – – 4.0 422,748

Dividend recognised as distribution to ordinary equity holders of the Company 4.0 426,770 4.0 422,748

The Directors do not propose any final dividend in respect of the financial year ended 30 June 2020.

Distribution of treasury shares (“Share Dividend”)

On 28 August 2020, a Share Dividend of one (1) treasury share for every thirty (30) existing ordinary shares held was declared and the book closure date for the Share Dividend is 28 October 2020.

158 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

11. PROPERTY, PLANT AND EQUIPMENT

Infra- structure Furniture, Telecom- Assets Land & & site Plant & fixtures & munication under building* facilities machinery equipment Vehicles equipment construction Total Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020

Cost/Valuation At 1.7.2019, as previously reported 11,673,973 8,467,160 23,970,206 2,080,562 789,288 3,117,440 2,085,460 52,184,089 Effect of adopting MFRS 16 (824,201) – – – – (86,696) – (910,897)

At 1.7.2019, restated 10,849,772 8,467,160 23,970,206 2,080,562 789,288 3,030,744 2,085,460 51,273,192 Acquisition of subsidiaries 249,495 – 319,615 7,627 13,112 – 22,962 612,811 Additions 64,172 419 77,878 43,412 26,170 2,349 1,550,595 1,764,995 Derecognition of subsidiary (440,020) – (47,200) (2,707) – – – (489,927) Disposal (13,254) – (17,701) (32,807) (42,969) (741) – (107,472) Written off (21,081) (740) (256,021) (123,793) (821) (1,202) (606) (404,264) Impairment loss 7 (26,005) – – – – – – (26,005) Transfer on commissioning 345,402 444,389 1,558,573 58,494 30,161 104,401 (2,541,420) – Transfer from development expenditures 14 542 – – – – – 89,960 90,502 Transfer from investment properties 13 270 6,133 – – – – – 6,403 Transfer from property development costs 23 316,709 – 56,281 – – – 8,375 381,365 Transfer to intangible assets^ 254,611 880 (753,005) 16,804 243,725 (56,635) (92,584) (386,204) Currency translation differences 77,468 26,336 45,803 15,162 1,601 – 20,100 186,470

At 30.6.2020 11,658,081 8,944,577 24,954,429 2,062,754 1,060,267 3,078,916 1,142,842 52,901,866

Accumulated depreciation and impairment At 1.7.2019, as previously reported 3,541,042 686,166 14,614,240 1,001,960 563,088 1,018,100 – 21,424,596 Effect of adopting MFRS 16 (251,924) – – – – (16,349) – (268,273)

At 1.7.2019, restated 3,289,118 686,166 14,614,240 1,001,960 563,088 1,001,751 – 21,156,323 Acquisition of subsidiaries 107,076 – 156,008 5,482 9,816 – – 278,382 Charge for the financial year 241,157 77,802 910,524 134,131 67,914 132,185 – 1,563,713 Derecognition of subsidiary (27,559) – (31,860) (2,626) – – – (62,045) Disposal (1,776) – (13,931) (29,845) (37,921) (217) – (83,690) Written off (14,067) (130) (243,747) (92,926) (785) (713) – (352,368) Impairment loss 7 – – 2,953 – – – – 2,953 Transfer to intangible assets^ 181,984 487 (440,267) 10,847 132,704 (48,885) – (163,130) Currency translation differences 39,031 16,737 (1,563) 6,886 1,054 – – 62,145

At 30.6.2020 3,814,964 781,062 14,952,357 1,033,909 735,870 1,084,121 – 22,402,283

Net book value At 30.6.2020 7,843,117 8,163,515 10,002,072 1,028,845 324,397 1,994,795 1,142,842 30,499,583

^ During the financial year, the Group decided to refine its analysis of assets and identify elements of its asset stock that could be classified as intangible assets. Following this exercise, those assets that met the definition were transferred from property, plant and equipment to intangible assets.

159 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

11. PROPERTY, PLANT AND EQUIPMENT (CONT’D.)

Infra- structure Furniture, Telecom- Assets Land & & site Plant & fixtures & munication under building* facilities machinery equipment Vehicles equipment construction Total Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2019

Cost/Valuation At 1.7.2018 10,232,886 8,228,973 19,072,492 1,932,357 620,060 2,789,896 2,072,452 44,949,116 Acquisition of subsidiaries 604,297 – 4,231,549 74,687 19,862 – 118,415 5,048,810 Additions 495,187 316,914 677,605 428,625 104,504 14,588 447,136 2,484,559 Disposal (714) – (25,220) (23,094) (41,367) – – (90,395) Written off (60,747) (426) (100,138) (22,381) (660) (10,044) (14,409) (208,805) Reversal of impairment loss 7 1,024 – – – – – – 1,024 Transfer on commissioning 405,689 – 17,848 (309,660) 83,680 323,000 (520,557) – Transfer from development expenditures 14 6,900 – – – – – – 6,900 Currency translation differences (10,549) (78,301) 96,070 28 3,209 – (17,577) (7,120)

At 30.6.2019 11,673,973 8,467,160 23,970,206 2,080,562 789,288 3,117,440 2,085,460 52,184,089

Accumulated depreciation and impairment At 1.7.2018 3,018,136 616,042 11,052,098 879,412 437,798 834,397 – 16,837,883 Acquisition of subsidiaries 359,028 – 2,864,896 62,355 17,135 – – 3,303,414 Charge for the financial year 222,614 75,960 829,456 107,594 76,517 193,034 – 1,505,175 Disposal (125) – (21,725) (18,480) (34,846) – – (75,176) Written off (54,630) (426) (98,117) (19,455) (53) (9,331) – (182,012) Impairment loss 7 – – 4,347 – – – – 4,347 Transfer on commissioning 4,235 – (63,541) (4,947) 64,253 – – – Currency translation differences (8,216) (5,410) 46,826 (4,519) 2,284 – – 30,965

At 30.6.2019 3,541,042 686,166 14,614,240 1,001,960 563,088 1,018,100 – 21,424,596

Net book value At 30.6.2019 8,132,931 7,780,994 9,355,966 1,078,602 226,200 2,099,340 2,085,460 30,759,493

160 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

11. PROPERTY, PLANT AND EQUIPMENT (CONT’D.) * Land & buildings of the Group are as follows:

Long-term Short-term Building on Building on Buildings on Factory Freehold leasehold leasehold freehold long-term short-term & other land land land land leasehold land leasehold land buildings Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020 Cost/Valuation At 1.7.2019, as previously reported At cost 1,054,959 601,385 317,870 7,334,743 1,409,972 943,648 2,635 11,665,212 At valuation 6,083 200 – 2,478 – – – 8,761 Effect of adopting MFRS 16 – (506,645) (317,556) – – – – (824,201) At 1.7.2019, restated 1,061,042 94,940 314 7,337,221 1,409,972 943,648 2,635 10,849,772 Acquisition of subsidiaries – – – – 249,495 – – 249,495 Additions 199 – – 18,670 11,213 34,090 – 64,172 Derecognition of subsidiary (207,177) (94,940) – (111,748) (26,155) – – (440,020) Disposal (3,006) – – (9,034) (622) (592) – (13,254) Written off – – – (11,220) (6,060) (3,656) (145) (21,081) Impairment loss – – – (26,005) – – – (26,005) Transfers 74,037 – (314) 593,183 292,622 (58,952) 16,958 917,534 Currency translation differences 10,355 – – 47,084 11,451 8,578 – 77,468 At 30.6.2020 935,450 – – 7,838,151 1,941,916 923,116 19,448 11,658,081

Representing:– At cost 929,367 – – 7,835,642 1,941,916 923,116 19,448 11,649,489 At valuation 6,083 – – 2,509 – – – 8,592 At 30.6.2020 935,450 – – 7,838,151 1,941,916 923,116 19,448 11,658,081

Accumulated depreciation and impairment At 1.7.2019, as previously reported At cost 40 77,824 179,218 2,496,654 408,428 375,955 2,143 3,540,262 At valuation – 32 – 748 – – – 780 Effect of adopting MFRS 16 – (68,393) (179,218) – – (4,313) – (251,924) At 1.7.2019, restated 40 9,463 – 2,497,402 408,428 371,642 2,143 3,289,118 Acquisition of subsidiaries – – – – 107,076 – – 107,076 Charge for the financial year – – – 165,930 46,867 27,640 720 241,157 Derecognition of subsidiary – (9,463) – (15,008) (3,088) – – (27,559) Disposal – – – (591) (593) (592) – (1,776) Written off – – – (6,364) (5,639) (1,924) (140) (14,067) Transfers – – – 3,255 209,204 (35,183) 4,708 181,984 Currency translation differences – – – 33,263 4,445 1,323 – 39,031 At 30.6.2020 40 – – 2,677,887 766,700 362,906 7,431 3,814,964

Net book value At cost 929,327 – – 5,158,552 1,175,216 560,210 12,017 7,835,322 At valuation 6,083 – – 1,712 – – – 7,795 At 30.6.2020 935,410 – – 5,160,264 1,175,216 560,210 12,017 7,843,117

161 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

11. PROPERTY, PLANT AND EQUIPMENT (CONT’D.) * Land & buildings of the Group are as follows:

Long-term Short-term Building on Building on Buildings on Factory & Freehold leasehold leasehold freehold long-term short-term other land land land land leasehold land leasehold land buildings Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2019

Cost/Valuation At 1.7.2018 At cost 1,033,325 472,694 166,383 6,953,618 1,087,824 507,458 2,635 10,223,937 At valuation 6,271 200 – 2,478 – – – 8,949 1,039,596 472,894 166,383 6,956,096 1,087,824 507,458 2,635 10,232,886 Acquisition of subsidiaries 31,862 48,963 126,743 – – 396,729 – 604,297 Additions 667 73,568 – 162,883 247,340 10,729 – 495,187 Disposal (188) – (464) – – (62) – (714) Written off – – – (60,747) – – – (60,747) Reversal of impairment – – – 1,024 – – – 1,024 Transfers (23,262) 8,022 19,314 316,020 80,095 12,400 – 412,589 Currency translation differences 12,367 (1,862) 5,894 (38,055) (5,287) 16,394 – (10,549)

At 30.6.2019 1,061,042 601,585 317,870 7,337,221 1,409,972 943,648 2,635 11,673,973

Representing:– At cost 1,054,959 601,385 317,870 7,334,743 1,409,972 943,648 2,635 11,665,212 At valuation 6,083 200 – 2,478 – – – 8,761 At 30.6.2019 1,061,042 601,585 317,870 7,337,221 1,409,972 943,648 2,635 11,673,973

Accumulated depreciation and impairment At 1.7.2018 At cost – 55,553 72,830 2,407,449 374,083 105,385 2,106 3,017,406 At valuation – 30 – 700 – – – 730 – 55,583 72,830 2,408,149 374,083 105,385 2,106 3,018,136 Acquisition of subsidiaries 40 15,776 92,880 – – 250,332 – 359,028 Charge for the financial year – 6,219 11,056 162,604 26,380 16,318 37 222,614 Disposal – – (94) – – (31) – (125) Written off – – – (54,630) – – – (54,630) Transfer on commissioning – 146 – (4,757) 8,336 510 – 4,235 Currency translation differences – 132 2,546 (13,964) (371) 3,441 – (8,216) At 30.6.2020 40 77,856 179,218 2,497,402 408,428 375,955 2,143 3,541,042

Net book value: At cost 1,054,919 523,561 138,652 4,838,089 1,001,544 567,693 492 8,124,950 At valuation 6,083 168 – 1,730 – – – 7,981 At 30.6.2019 1,061,002 523,729 138,652 4,839,819 1,001,544 567,693 492 8,132,931

162 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

11. PROPERTY, PLANT AND EQUIPMENT (CONT’D.)

Furniture, fittings & equipment Vehicles Total Note RM’000 RM’000 RM’000

Company – 2020

Cost At 1.7.2019 7,208 9,292 16,500 Additions 187 – 187

At 30.6.2020 7,395 9,292 16,687

Accumulated depreciation At 1.7.2019 6,701 5,325 12,026 Charge for the financial year 7 415 394 809

At 30.6.2020 7,116 5,719 12,835

Net book value At 30.6.2020 279 3,573 3,852

Company – 2019

Cost At 1.7.2018 7,055 8,417 15,472 Additions 153 1,334 1,487 Disposal – (459) (459)

At 30.6.2019 7,208 9,292 16,500

Accumulated depreciation At 1.7.2018 6,305 5,161 11,466 Charge for the financial year 7 396 493 889 Disposal – (329) (329)

At 30.6.2019 6,701 5,325 12,026

Net book value

At 30.6.2019 507 3,967 4,474

163 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

11. PROPERTY, PLANT AND EQUIPMENT (CONT’D.)

(a) Depreciation charge for the financial year is allocated as follows:

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Profit or loss 7 1,554,423 1,497,585 809 889 Construction contract costs 24(c) 9,290 7,590 – –

1,563,713 1,505,175 809 889

(b) Assets under finance lease

The net book value of the property, plant and equipment as at reporting date held under finance leases are as follows:

Group Company 2019 2019 RM’000 RM’000

Plant and machinery 94,987 – Vehicles 4,302 2,528

99,289 2,528

(c) Security

The net book value of the Group’s property, plant and equipment that have been pledged as security for the bank facilities and bonds by way of fixed and floating charges are as follows:

Group

2020 2019 RM’000 RM’000

Land 168,961 164,166 Buildings 892,218 1,381,634

1,061,179 1,545,800

(d) Borrowing cost

Borrowing costs of RM18,554,000 (2019: RM8,348,000) arising on financing specifically entered into for the construction of property, plant and equipment was capitalised during the financial year.

164 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

11. PROPERTY, PLANT AND EQUIPMENT (CONT’D.)

The Group has revised the useful lives of certain property, plant and equipment during the financial year. The revision was accounted for as a change in accounting estimate and as a result, the depreciation charge for the financial year ended 30 June 2020 has decreased approximately by RM97.1 million (2019: RM83.4 million).

Impairment assessment for property, plant and equipment (“PPE”) of a subsidiary

The recoverable amount of the PPE assessed as part of a cash generating unit (“CGU”) are determined based on the fair value less costs of disposal (“FVLCD”) calculation.

The following are the key assumptions applied in the FVLCD calculation for impairment assessment of PPE of a subsidiary in the telecommunications business division:

2020 2019

Discount rate 7.7% 8.2% Average revenue growth rate 20.7% 21.4%

The discount rate applied to the cash flow projections are derived from the cost of capital at the date of the assessment.

The cash flow projections used in the FVLCD calculation were based on approved financial budgets and forecasts covering a 5 year period, adjusted to reflect market’s participants assumptions. Cash flows beyond the 5 year period were extrapolated a further 15 years representing the estimated useful lives of the PPE of the subsidiary, using the estimated long-term growth rate of 2.5% (2019: 2.5%).

Fair value is held within Level 3 in fair value hierarchy disclosures.

The carrying amount of the CGU is RM2.7 billion (2019: RM2.2 billion). No impairment charge was recognised as the recoverable amount of the CGU was in excess of its carrying amount.

The subsidiary was awarded contract during the financial year and is expected to be continued in the coming years. If the contract value decrease by 24.7%, the recoverable amount of the CGU will be equal to the corresponding carrying amount in 2020.

If the discount rate increase by 1%, the carrying value will be reduced by approximate RM90 million. And, if the average revenue growth rate decrease by 0.5%, the carrying value will be reduced by approximately RM100 million.

165 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

12. RIGHT-OF-USE ASSETS

Telecom- munications network site and Motor Plant and Leasehold Land equipment Buildings vehicles machinery land Others Total Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020

Net Book Value: At 1 July 2019, as previously reported – – – – – – – – Effects of adoption of MFRS 16 122,117 666,781 94,207 4,674 12,378 572,621 – 1,472,778

At 1 July 2019, as restated 122,117 666,781 94,207 4,674 12,378 572,621 – 1,472,778 Additions 6,446 11,885 314,447 260 – 10,199 2,096 345,333 Acquisition subsidiary – – – – – 6,482 – 6,482 Charge for the financial year 7 (24,900) (114,136) (17,957) (2,461) (7,135) (25,575) (1,731) (193,895) Currency translation differences 426 – 612 7 50 4,892 2 5,989 Expiry/Termination – (395) (257) – – – – (652)

At 30 June 2020 104,089 564,135 391,052 2,480 5,293 568,619 367 1,636,035

At 30 June 2020 Cost 130,728 1,327,862 411,161 4,942 12,403 848,623 2,114 2,737,833 Accumulated depreciation (26,639) (763,727) (20,109) (2,462) (7,110) (280,004) (1,747) (1,101,798)

Net book value 104,089 564,135 391,052 2,480 5,293 568,619 367 1,636,035

166 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

12. RIGHT-OF-USE ASSETS (CONT’D.)

Building Note RM’000

Company – 2020

Net Book Value: At 1 July 2019 – Additions 13,604 Charge for the financial year 7 (4,535)

At 30 June 2020 9,069

At 30 June 2020 Cost 13,604 Accumulated depreciation (4,535)

Net book value 9,069

The Group and the Company have lease contracts for various items of land, buildings, telecommunications network site and equipment, buildings, motor vehicle, plant and machinery, leasehold land and other used in their operations. Leases of those assets generally have lease term between 1 to 30 years.

The Group and the Company also have certain leases with lease terms of 12 months or less and leases that have been determined to be low value. The Group and the Company apply the ‘short-term lease’ and ‘lease of low-value assets’ recognition exemption for these leases.

The right-of-use assets relating to commercial properties presented under investment properties (Note 13) is stated fair value and has a carrying amount at reporting date of RM547,452,000.

Total cash outflow for all the leases in 2020 was RM523,529,000.

167 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

13. INVESTMENT PROPERTIES

Long-term Freehold leasehold land & land & buildings buildings Total Note RM’000 RM’000 RM’000

Group – 2020

At beginning of the financial year 2,960,906 7,256,667 10,217,573 Additions 343,257 215,959 559,216 Change in fair value recognised in profit or loss 7 (1,633) (11,175) (12,808) Currency translation differences (12,741) (42,968) (55,709) Derecognition of subsidiary (1,979,583) (6,851,698) (8,831,281) Transfer to property development costs 23 (51,787) – (51,787) Transfer to property, plant and equipment 11 (6,403) – (6,403) Written off 7 (7,650) (25) (7,675)

At end of the financial year 1,244,366 566,760 1,811,126

Group – 2019

At beginning of the financial year 2,902,048 7,101,841 10,003,889 Acquisition of subsidiary 2,304 2,163 4,467 Additions 40,574 2,922 43,496 Change in fair value recognised in profit or loss 7 79,932 (66,760) 13,172 Currency translation differences (34,799) 216,501 181,702 Disposal (10,128) – (10,128) Transfer from inventory 19,382 – 19,382 Transfer to property development costs 23 (23,225) – (23,225) Transfer to property, plant and equipment (15,182) – (15,182)

At end of the financial year 2,960,906 7,256,667 10,217,573

Investment properties with carrying amount of RM481 million (2019: RM2,455 million) are charged as security for a borrowing granted to the Group as disclosed in Note 30 and Note 31 to the financial statements.

168 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

13. INVESTMENT PROPERTIES (CONT’D.)

Level 1 Level 2 Level 3 Total RM’000 RM’000 RM’000 RM’000

Group – 2020

Recurring fair value measurements: Investment properties – Commercial properties – – 547,452 547,452 – Hotel properties – – 672,000 672,000 – Other properties – 34,610 557,064 591,674

Total – 34,610 1,776,516 1,811,126

Group – 2019

Recurring fair value measurements: Investment properties – Commercial properties – – 8,947,689 8,947,689 – Hotel properties – – 667,000 667,000 – Other properties – 34,592 568,292 602,884

Total – 34,592 10,182,981 10,217,573

Rental income from investment properties of the Group during the financial year amounted to RM526,819,000 (2019: RM594,936,000).

Direct operating expenses from investment properties in respect of income and non-income generating properties of the Group during the financial year amounted to RM6,548,000 (2019: RM118,826,000) and RM11,251,000 (2019: RM201,473,000), respectively.

169 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

13. INVESTMENT PROPERTIES (CONT’D.)

(a) Fair value information

The Group’s investment properties are valued based on sale comparison approach and unobservable inputs and classified in Level 2 and Level 3 respectively of the fair value hierarchy. The different levels of the fair value hierarchy are defined in Note 39(b) to the financial statements.

During the current financial year, there were no transfers between Level 1, Level 2 and Level 3 fair value measurements.

(b) Valuation techniques used to derive Level 2 fair values

Level 2 fair values of the Group’s properties have been generally derived using the sales comparison approach. Sales prices of comparable properties in close proximity are adjusted for differences in key attributes such as property size. The most significant input into this valuation approach is selling price per square meter.

(c) Fair value measurements using significant unobservable inputs (Level 3)

The following table shows the valuation techniques used in the determination of fair values within Level 3, as well as the significant unobservable inputs used in the valuation models.

(i) Commercial properties

Inter-relationship between significant unobservable inputs and fair value Valuation technique Significant unobservable inputs measurement

2020 Discounted cash flow approach which Discount rate from 6.5% to 7.50% The higher the discount rate, the lower involves the estimation and projection the fair value. of income stream over a period and discounting the future income stream to arrive at the present value.

Estimate rental value per square feet The higher the estimate rental per square per month feet, the higher the valuation.

2019 Discounted cash flow method is the Discount rate from 3.50% to The higher the discount rate, the lower total of discounted income stream 8.50% the fair value. and present value of the properties’ Capitalisation rate from 3.70% to The higher the capitalisation rate, the anticipated sale value in arriving at 6.88% lower the fair value. the total present market value.

170 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

13. INVESTMENT PROPERTIES (CONT’D.)

(c) Fair value measurements using significant unobservable inputs (Level 3) (cont’d.)

(ii) Hotel properties

Inter-relationship between significant unobservable inputs and fair value Valuation technique Significant unobservable inputs measurement

Income approach which capitalise the Discount rate of 6.00% to 7.50% The higher the discount rate, the lower estimate rental income stream, net (2019: 6.00% to 7.50%) the fair value. projected operating costs, using a discount rate derived from market yield

Capitalisation rate of 6.00% to The higher the capitalisation rate, the 7.50% (2019: 6.00% to 7.50%) lower the fair value.

(iii) Other properties – UK

Range

Valuation technique Significant observable inputs 2020 2019

Hangars Capitalised income Estimated rental value per sq-ft per annum £1.50 – £3.00 £1.75 – £2.25

Net yield percentage 9.1% 11.0%

Void periods 12-24 months 12 months

Airfield Transaction prices Unit density per acre 18 – 28 18 – 28

Key unobservable inputs correspond to: – Capitalisation rates derived from specialised publications from the related markets and comparable transactions. – Discount rate, which are largely based on the risk-free rate of government in the relevant market, adjusted for a risk premium to reflect both the increased risk of investing in the asset class.

Some of the independent valuation reports have highlighted that with the heightened uncertainty of the COVID-19 pandemic, a higher degree of caution should be exercised when relying upon their valuation. The valuations are based on the information available as at the date of valuation. Values may change more rapidly and significantly than during normal market conditions.

The investment properties are valued using the income capitalisation method, where a property’s fair value is estimated based on the normalised net operating income generated by the property, which is divided by the capitalisation (discount) rate based on current market-derived yield rates which reflect the expected return on investments commensurate with the risk exposure associated to the asset.

The significant unobservable input is the adjustment for factors specific to the properties. The extent and direction of this adjustment depends on the number and characteristics of the observable market transactions in similar properties that are used as the starting point for valuation. Although this input is a subjective judgement, management considers that the overall valuation would not be materially affected by reasonably possible alternative assumptions.

171 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

14. DEVELOPMENT EXPENDITURES

The movement in development expenditures of the Group during the financial year is as follows:-

Freehold Leasehold Development land land costs Total Group – 2020 Note RM’000 RM’000 RM’000 RM’000

Land held for property (a) development cost Cost At beginning of the financial year 412,956 232,403 242,096 887,455 Additions – 4,948 18,827 23,775 Transfer from property development costs 23 7,322 – – 7,322 Transfer to inventory – (10,898) (332) (11,230)

At end of the financial year 420,278 226,453 260,591 907,322

Accumulated impairment losses At beginning of the financial year (530) (27,767) (480) (28,777) Reversal of impairment 7 – 2,978 – 2,978

At end of the financial year (530) (24,789) (480) (25,799)

Total land held for property development 419,748 201,664 260,111 881,523

(b) Project development expenditure At beginning of the financial year – 177,057 91,503 268,560 Additions – 3,867 64,669 68,536 Charge to profit or loss – – (8,175) (8,175) Currency translation difference – 5,966 2,313 8,279 Transfer to property, plant and equipment 11 – – (90,502) (90,502)

At end for the financial year – 186,890 59,808 246,698

Total development expenditure 419,748 388,554 319,919 1,128,221

172 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

14. DEVELOPMENT EXPENDITURES (CONT’D.)

The movement in development expenditures of the Group during the financial year is as follows:- (cont’d.)

Freehold Leasehold Development land land costs Total Group – 2019 Note RM’000 RM’000 RM’000 RM’000

(a) Land held for property development cost At beginning of the financial year 411,576 235,425 233,789 880,790 Additions – – 12,244 12,244 Reclassification 1,380 62 (1,442) – Disposal – (11) (1,123) (1,134) Written off – – (457) (457) Transfer to property development costs 23 – (3,073) (915) (3,988)

At end of the financial year 412,956 232,403 242,096 887,455

Accumulated impairment losses At beginning of the financial year – (27,315) (382) (27,697) Impairment losses 7 (530) (452) (98) (1,080)

At end of the financial year (530) (27,767) (480) (28,777)

Total land held for property development 412,426 204,636 241,616 858,678

(b) Project development expenditure At beginning of the financial year – 159,144 115,154 274,298 Additions – 13,772 106,670 120,442 Charge to profit or loss – – (3,392) (3,392) Currency translation difference – 4,141 3,180 7,321 Transfer from inventory – – (40,078) (40,078) Transfer to property development costs 23 – – (83,131) (83,131) Transfer to property, plant and equipment 11 – – (6,900) (6,900)

At end of the financial year – 177,057 91,503 268,560

Total development expenditure 412,426 381,693 333,119 1,127,238

In the previous financial year, the impairment review has led to the recognition of impairment loss amounting to RM1,080,000 due to decline in estimate recoverable amount of development cost.

173 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

14. DEVELOPMENT EXPENDITURES (CONT’D.)

Land held for property development with carrying amount of RM327,064,000 (2019: RM182,590,000) are charged as security for borrowing granted to the Group as disclosed in Note 31 to the financial statements.

Included in project development expenditure, land acquisition costs relating to the construction of the power plant by P.T. Tanjung Jati Power Company under a 30-year power purchase agreement with PT PLN (Persero), Indonesia’s state-owned electric utility company, a second amended and restated version of which was executed in March 2018. In February 2020, P.T. Tanjung Jati Power Company obtained the Business Viability Guarantee Letter from the Ministry of Finance of the Republic of Indonesia and is working towards achieving financial close.

15. INVESTMENT IN SUBSIDIARIES

Company

2020 2019 RM’000 RM’000

Quoted shares, at cost 3,470,029 3,972,483 Unquoted shares, at cost 4,300,374 3,449,919 Quoted ICULS, at cost* – 391,502 Less: Accumulated impairment losses (6,389) (6,389)

7,764,014 7,807,515

Market value – Quoted shares 3,491,567 4,701,802 – Quoted ICULS – 238,816

3,491,567 4,940,618

* Quoted ICULS, at cost

These are related to ten (10) years ICULS issued by YTL Land & Development Berhad, a subsidiary of the Group, on 31 October 2011. These ICULS bear a step-up coupon rate ranging from 3% to 6% per annum until its maturity date. The interest is payable semi-annually. The conversion price of the ICULS is fixed at a step-down basis. In the first four (4) years, the conversion price is at RM1.32 for one (1) ordinary share in YTL Land & Development Berhad, after which it is at RM0.99 in the next three (3) years and at RM0.66 for the remaining three (3) years.

The ICULS were quoted on Bursa Securities and have been delisted effective from 21 October 2019.

174 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held by the Company: Arah Asas Sdn. Bhd. Malaysia Property development 100.00 100.00 Business & Budget Hotels Sdn. Bhd. Malaysia Management & investment holding 100.00 100.00 Cane Creations Sdn. Bhd. Malaysia Investment holding 100.00 100.00 Cornerstone Crest Sdn. Bhd. Malaysia Investment holding 100.00 100.00 Divine View Sdn. Bhd. Malaysia Commercial trading, property dealing & 100.00 100.00 investment holding Intellectual Mission Sdn. Bhd. Malaysia Education & training using advanced 100.00 100.00 technology Prisma Tulin Sdn. Bhd. Malaysia Hotel operator 100.00 100.00 Spectacular Corner Sdn. Bhd. Malaysia Dormant 100.00 100.00 Starhill Global Real Estate Investment Singapore Investment in prime real estate – 36.46 Trust (“SGREIT”)*§ Syarikat Pembenaan Yeoh Tiong Lay Malaysia Civil engineering works, construction, 100.00 100.00 Sdn. Bhd. property development & real estate investment, investment holding & related services Titiwangsa Development Sdn. Bhd. Malaysia Inactive 100.00 100.00 YTL Cayman Limited‡ Cayman Islands Investment holding, ownership & chartering 100.00 100.00 of yachts & vessels YTL Cement Berhad Malaysia Investment holding, management company 98.03 98.03 & hiring of vehicles YTL Charters Sdn. Bhd. Malaysia Chartering of aircrafts, helicopters, ships & 100.00 100.00 vehicles YTL Corporation (UK) Plc* England & Wales Inactive 100.00 100.00 YTL Corp Finance (Cayman) Limited ‡ Cayman Islands Inactive 100.00 100.00 YTL Corp Finance (Labuan) Limited ‡ Malaysia Special purpose vehicle for issuance of 100.00 100.00 securities & investment holding

175 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held by the Company: (cont’d.) YTL e-Solutions Berhad Malaysia Investment holding, provision and 100.00 100.00 maintenance of information technology hardware and software systems, network and internet connectivity infrastructure, web hosting services, content development, provision of e-commerce systems, hardware sales and other related services YTL Energy Sdn. Bhd. Malaysia Investment holding 100.00 100.00 YTL (Guernsey) Limited ‡ Guernsey Investment & property holding 100.00 100.00 YTL Hospitality REIT (“YTLREIT”) Malaysia Management of real estate investment 56.95 56.95 trusts YTL Hotel Management Saint Tropez France Hotel operator & management services 100.00 100.00 SARL‡ YTL Hotels & Properties Sdn. Bhd. Malaysia Investment holding & management services 100.00 100.00 YTL Industries Berhad Malaysia Investment holding, property development 100.00 100.00 and property investment YTL Land Sdn. Bhd. Malaysia Property investment, property and project 100.00 100.00 management YTL Land & Development Berhad* Malaysia Investment holding & provision of 96.60 65.26 management, financial, treasury & secretarial services YTL Power International Berhad Malaysia Investment holding & provision of 55.21 55.21 (“YTL Power”)* administrative & technical support services YTL Singapore Pte. Ltd.* Singapore Investment holding & management company 100.00 100.00 YTL-SV Carbon Sdn. Bhd. Malaysia Providing consultancy services 90.00 90.00

176 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through Business & Budget Hotels Sdn. Bhd.: Business & Budget Hotels (Penang) Malaysia Hotel operator 51.00 51.00 Sdn. Bhd. Business & Budget Hotels (Seberang Malaysia Inactive 51.00 51.00 Jaya) Sdn. Bhd.

Held through Cane Creations Sdn. Bhd.: Cane Creations (Marketing) Sdn. Bhd. Malaysia Trading in cane furniture, local handicrafts, 100.00 100.00 accessories & related services Natural Adventure Sdn. Bhd. Malaysia Retailing of merchandise and provision of 100.00 100.00 online retail services Niche Retailing Sdn. Bhd. Malaysia Retailing of fashion apparels and related 100.00 100.00 accessories Prestige Lifestyles & Living Sdn. Bhd. Malaysia Trading of furniture and accessories 100.00 100.00 Star Hill Living.Com Sdn. Bhd. Malaysia Project management services, trading of 100.00 100.00 paintings, furniture, accessories & related services Trendy Retailing Sdn. Bhd. Malaysia Inactive 100.00 100.00

Held through Divine View Sdn. Bhd.: SCI YTL Hotels Saint Tropez‡ France Acquisition, management, renting & 100.00 100.00 administration and/or resale of real estate

Held through Starhill Global Real Estate Investment Trust (“SGREIT”): Ara Bintang Berhad*§ Malaysia Property investment – 36.46

Chengdu Xin Hong Management Co. The People’s Property investment – 36.46 Ltd.*§ Republic of China SG REIT (M) Pte. Ltd.*§ Singapore Investment holding – 36.46 SG REIT (WA) Pte. Ltd.*§ Singapore Investment holding – 36.46

177 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through Starhill Global Real Estate Investment Trust (“SGREIT”): (cont’d.) SG REIT (WA) Trust*§ Australia Property investment – 36.46 SG REIT (WA) Sub-Trust1*§ Australia Property investment – 36.46 SG REIT (SA) Sub-Trust2*§ Australia Property investment – 36.46 Starhill Global REIT Japan SPC One Pte. Singapore Investment holding – 36.46 Ltd.*§ Starhill Global REIT Japan SPC Two Pte. Singapore Investment holding – 36.46 Ltd.*§ Starhill Global REIT MTN Pte. Ltd.*§ Singapore Issuer of notes under the Medium Term – 36.46 Note Programme Starhill Global REIT One TMK*§ Japan Property investment – 36.46 Starhill Global ML K.K. ‡ § Japan Master lessee of Japan properties – 36.46 Top Sure Investment Ltd.*§ Hong Kong Investment holding – 36.46

Held through Syarikat Pembenaan Yeoh Tiong Lay Sdn. Bhd.: Austasia Metal Sdn. Bhd.* Malaysia Inactive 100.00 100.00 Austasia Timbers Malaysia Sdn. Bhd. Malaysia Inactive 100.00 100.00 Builders Brickworks Sdn. Bhd. Malaysia Inactive 93.80 93.80 Construction Lease (M) Sdn. Bhd. Malaysia Leasing, hire purchase & credit 100.00 100.00 Dayang Bay Development Sdn.Bhd. Malaysia Property investment and development 100.00 100.00 Dayang Bunting Resorts Sdn. Bhd. Malaysia Property investment and development 100.00 100.00 Dynamic Marketing Sdn. Bhd. Malaysia Trading of building & construction materials 100.00 100.00 Hotel 25 Sdn. Bhd. Malaysia Hotel operator 100.00 100.00 First Commercial Development Sdn. Bhd. Malaysia Property investment 100.00 100.00 Kampung Tiong Development Sdn. Bhd. Malaysia Property development 70.00 70.00 Lay Seng Oil Palm Plantations Sdn. Bhd. Malaysia Cultivation of oil palms 100.00 100.00 Northwestern Development Sdn. Bhd. Malaysia Property investment and development 100.00 100.00

178 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through Syarikat Pembenaan Yeoh Tiong Lay Sdn. Bhd.: (cont’d.) Permai Property Management Sdn. Bhd. Malaysia Inactive 100.00 100.00 Suri Travel & Tours Sdn. Bhd. Malaysia Rental of motor vehicles, air ticketing & 100.00 100.00 other related services Transportable Camps Sdn. Bhd. Malaysia Trading & rental of transportable cabins & 100.00 100.00 wood based products Yap Yew Hup Brickworks (Perak) Sdn. Malaysia Inactive 93.80 93.80 Bhd. Yeoh Tiong Lay Realty Sdn. Bhd. Malaysia Realty, investment & management services 100.00 100.00 YTL Construction International Cayman Islands Investment holding in construction related 100.00 100.00 (Cayman) Limited‡ activities YTL Construction (S) Pte. Ltd.* Singapore Construction related activities & real estate 100.00 100.00 developer YTL Civil Engineering Sdn. Bhd. Malaysia Civil engineering works & construction 90.00 90.00 YTL Development Sdn. Bhd. Malaysia Inactive 70.00 70.00 YTL Project Management Services Malaysia Provision of management services for 100.00 100.00 Sdn. Bhd. construction projects YTL Technologies Sdn. Bhd. Malaysia Servicing & hiring of equipment 99.21 99.21 YTL THP JV Sdn. Bhd. Malaysia Inactive 70.00 70.00

Held through YTL Cayman Limited: Just Heritage Sdn. Bhd.* Malaysia Investment holding 100.00 100.00 Starhill Global REIT Investments Cayman Islands Investment holding 100.00 100.00 Limited‡ Starhill Global REIT Management Cayman Islands Investment holding 100.00 100.00 Limited‡ YTL Construction (Thailand) Limited* Thailand Construction activities 74.89 74.89 YTL Power Services Sdn. Bhd. Malaysia Operation & maintenance of power station 100.00 100.00 YTL Property Investments Limited‡ Cayman Islands Investment holding 100.00 100.00

179 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Cayman Limited: (cont’d.) YTL Starhill Global Property Singapore Property management services 100.00 100.00 Management Pte. Ltd.* YTL Starhill Global REIT Management Singapore Investment holding 100.00 100.00 Holdings Pte. Ltd.* YTL Starhill Global REIT Management Singapore Investment advisor, property fund 100.00 100.00 Limited* management services and to act as the Manager of SGREIT

Held through YTL Cement Berhad: Associated Pan Malaysia Cement Sdn. Malaysia Manufacture and sale of clinker and cement 75.46 75.46 Bhd.*@ Batu Tiga Quarry Sdn. Bhd. Malaysia Quarry business & trading of granite 98.03 98.03 aggregates Batu Tiga Quarry (Sg. Buloh) Sdn. Bhd. Malaysia Quarry business & related services 98.03 98.03 Beijing Dama Sinosource Trading The People’s Trading of mechanical, electrical equipment 98.03 98.03 Co., Ltd* Republic of China and parts, and technology transfer, development and consultancy Bentara Gemilang Industries Sdn. Bhd. Malaysia Quarry business & related services 49.02 49.02 Binh Duong Fico Cement Single Member Vietnam Manufacturing cement, line & plaster 68.62 – Limited Liability Company* Buildcon-Cimaco Concrete Sdn. Bhd. Malaysia Manufacturing & sale of ready-mixed concrete 98.03 98.03 Buildcon Concrete Enterprise Sdn. Bhd. Malaysia Investment holding 98.03 98.03 Buildcon Concrete Sdn. Bhd. Malaysia Manufacturing & sale of ready-mixed concrete 98.03 98.03 Buildcon Concrete (KL) Sdn. Bhd. Malaysia Inactive 98.03 98.03 C.I. Quarrying & Marketing Sdn. Bhd. Malaysia Quarry business & related services 98.03 98.03 C.I. Readymix Sdn. Bhd. Malaysia Manufacturing & sale of ready-mixed concrete 98.03 98.03 CMCM Perniagaan Sdn. Bhd.*@ Malaysia Trading of cement and other building 75.46 75.46 materials Competent Teamwork Sdn. Bhd. Malaysia Investment holding 98.03 98.03 Concrete Industries Pte. Ltd.* Singapore Dormant 98.03 98.03 Concrete Star Limited ‡ Cayman Islands Investment holding 98.03 98.03

180 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Cement Berhad: (cont’d.) Equity Corporation Sdn. Bhd. Malaysia Quarry business & related services 98.03 98.03 Fico Tay Ninh Cement Joint Stock Vietnam Manufacture & sale of ordinary portland 68.62 – Company*# cement & blended cement Fico-YTL Cement Sales and Marketing Vietnam Sale & marketing of cementitious products 68.62 – Company Limited*# Gemilang Pintar Sdn. Bhd. Malaysia Marketing & trading of quarry products 68.62 68.62 Geocycle Environmental Services Malaysia Waste management in cement manufacturing 75.46 75.46 Sdn. Bhd.*@ activities

Geocycle Malaysia Sdn. Bhd.*@ Malaysia Trading of any type of cementitious 75.46 75.46 materials for cement or concrete use Green Enable Technologies Sdn. Bhd. Malaysia Consultancy services in relation to the 98.03 98.03 promotion of the gasification of municipal solid waste for disposal in cement kilns Holcim (Malaysia) Sdn. Bhd.*@ Malaysia Manufacturing and sale of cement 75.46 75.46 Hopefield Enterprises Limited* Hong Kong Investment holding 98.03 98.03 Industrial Procurement Limited‡ Cayman Islands Investment holding 98.03 98.03 Jaksa Quarry Sdn. Bhd. Malaysia Quarry business & related services 98.03 98.03 Jumewah Shipping Sdn. Bhd.*@ Malaysia Shipping of bulk cement and chartering of 75.46 75.46 vessels Jurong Cement Limited (formerly known Singapore Investment holding, importers, dealers of 98.03 88.99 as Holcim (Singapore) Limited)*@ ready-mix concrete, dry-mix mortar products, business of owners of storage terminal facilities & sales of cement Kedah Cement Holdings Berhad*@ Malaysia Investment holding 75.46 75.46 Kedah Cement Sdn. Bhd. Malaysia Manufacture and sale of clinker and cement 75.46 75.46 (formerly known as Lafarge Cement Sdn. Bhd.)*@ Kedah Cement Jetty Sdn. Bhd.*@ Malaysia Management and operation of a jetty 75.46 75.46 Kenneison Construction Materials Sdn. Malaysia Inactive 98.03 98.03 Bhd.

181 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Cement Berhad: (cont’d.) Kenneison Northern Quarry Sdn. Bhd. Malaysia Manufacturing, selling & distribution of 98.03 98.03 premix products, construction & building materials Lafarge Aggregates (Kota Tinggi) Sdn. Malaysia Quarrying and trading of granite and quarry 75.46 75.46 Bhd.*@ products Lafarge Aggregates (Pantai Remis) Sdn. Malaysia Producer and supplier of aggregates and 75.46 75.46 Bhd.*@ related products Lafarge Aggregates Sdn. Bhd.*@ Malaysia Investment holding, trading and quarrying 75.46 75.46 of aggregates and related products Lafarge Concrete (East Malaysia) Malaysia Dormant 70.38 70.38 Sdn. Bhd. (In members’ voluntary liquidation)*@ Lafarge Concrete (Malaysia) Sdn. Bhd. Malaysia Manufacture and sale of ready-mix concrete 70.38 70.38 *@ Lafarge Concrete Industries Sdn. Bhd. Malaysia Manufacture and sale of ready-mix concrete 70.38 70.38 *@ Lafarge Drymix Sdn. Bhd.*@ Malaysia Manufacture and sale of cement and drymix 75.46 75.46 products Lafarge Marketing Pte. Ltd.*@ Singapore Investment holding 75.46 75.46 LCS Pte. Ltd. (formerly known as Singapore Bulk import and sale of cement and trading 75.46 75.46 Lafarge Cement Singapore Pte. Ltd.) of other building materials *@ LCS Shipping Pte. Ltd.*@ Singapore Shipping of bulk cement and chartering of 75.46 75.46 vessels LMCB Holdings Pte. Ltd.*@ Singapore Investment holding 75.46 75.46 Madah Seloka Sdn. Bhd. Malaysia Quarry business & related services 98.03 98.03 Malayan Cement Berhad*@ Malaysia Investment holding 75.46 75.46 M-Cement Sdn. Bhd.*@ Malaysia Investment holding 75.46 75.46 Mini-Mix Sdn. Bhd. Malaysia Manufacturing & sale of ready-mix concrete 98.03 98.03 & hiring of vehicles Mobijack Sea Sdn. Bhd. Malaysia Quarry business & related services 98.03 98.03

182 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Cement Berhad: (cont’d.) Mutual Prospect Sdn. Bhd. Malaysia Quarry business & related services 98.03 98.03 Nanyang Cement Pte. Ltd.* Singapore Cement terminal operation, bulk breaking 98.03 98.03 activities and trading in cement Nhu Anh Investment Joint Stock Vietnam Investment holding 98.03 – Company*# Oasis Vision Sdn. Bhd. Malaysia Production, selling & distribution of 35.00 35.00 construction & building materials Pahang Cement Marketing Sdn. Bhd. Malaysia Inactive 98.03 98.03 Pahang Cement Sdn. Bhd. Malaysia Manufacture & sale of ordinary portland 98.03 98.03 cement, clinker & related products Perak-Hanjoong Simen Sdn. Bhd. Malaysia Manufacture & sale of ordinary portland 98.03 98.03 cement, clinker & related products Permodalan Hitec Sdn. Bhd. Malaysia Quarry business & related services 98.03 98.03 PHS Trading Sdn. Bhd. Malaysia Management of plant 98.03 98.03 PMCWS Enterprises Pte. Ltd.*@ Singapore Investment holding 75.46 75.46 Probuilders Centre Sdn. Bhd. Malaysia Trading of cement and other building 75.46 75.46 (In members’ voluntary liquidation)*@ materials P.T. YTL Semen Indonesia* Indonesia Manufacture & sale of ordinary portland 98.03 98.03 cement & ready-mixed concrete RC Aggrerates Sdn. Bhd. Malaysia Handling of construction waste materials 98.03 98.03 and sales of the recycled concrete aggregates Simen Utama Marketing Sdn. Bhd.*@ Malaysia Dormant 75.46 75.46 Sino Mobile and Heavy Equipment Malaysia Trading & maintenance of trucks & parts 98.03 98.03 Sdn. Bhd. & heavy equipment Slag Cement Sdn. Bhd. Malaysia Manufacture & sale of ordinary portland 98.03 98.03 cement & blended cement Slag Cement (Southern) Sdn. Bhd. Malaysia Manufacture & sale of ordinary portland 98.03 98.03 cement & blended cement SMC Mix Sdn. Bhd. Malaysia Inactive 98.03 98.03

183 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Cement Berhad: (cont’d.) Solaris Concept Sdn. Bhd. Malaysia Production, selling & distribution of 50.00 50.00 construction & building materials Straits Cement Sdn. Bhd. Malaysia Manufacture & sale of ordinary portland 98.03 98.03 cement, clinker and related products Supermix Concrete Pte. Ltd.*@ Singapore Investment holding 75.46 75.46 Tugas Sejahtera Sdn. Bhd. Malaysia Investment holding 98.03 98.03 YTL Cement (Cambodia) Holdings Pte. Singapore Dormant 98.03 98.03 Ltd.* YTL Cement Enterprise Sdn. Bhd. Malaysia Investment holding 98.03 98.03 YTL Cement (Hong Kong) Limited* Hong Kong Investment holding 98.03 98.03 YTL Cement Marketing Sdn. Bhd. Malaysia Sale & marketing of cementitious products 98.03 98.03 YTL Cement Marketing Singapore Pte. Singapore Sale & marketing of cement, cementitious 98.03 98.03 Ltd.* products & other related construction products YTL Cement Myanmar Company Myanmar Manufacture & sale of ordinary portland 98.03 98.03 Limited* cement & related products

YTL Cement (Myanmar) Holdings Pte. Singapore Investment holding 98.03 98.03 Ltd.* YTL Cement (Philippines) Holdings Pte. Singapore Dormant 98.03 98.03 Ltd.* YTL Cement (Sabah) Sdn. Bhd. Malaysia Investment holding 98.03 98.03 YTL Cement Shared Services Sdn. Bhd. Malaysia Accounting shared services, and 75.46 75.46 (formerly known as Lafarge Shared management consulting services Services Sdn. Bhd.)*@ YTL Cement Singapore Pte. Ltd.* Singapore Investment holding, general importers & 98.03 98.03 exporters of construction materials YTL Cement Terminal Services Pte. Singapore Operation of port terminal & handling of 98.03 98.03 Ltd.* cementitious products YTL Cement (Vietnam) Pte. Ltd.* Singapore Investment holding 98.03 98.03

184 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Cement Berhad: (cont’d.) YTL Concrete (S) Pte. Ltd.* Singapore Manufacture of ready-mixed concrete, 98.03 98.03 wholesale of structural clay & concrete products & mixed construction activities YTL Premix Sdn. Bhd. Malaysia Trading of building materials & related 98.03 98.03 services Zhejiang Hangzhou Dama Cement The People’s Manufacture & sale of ordinary portland 98.03 98.03 Co., Ltd.* Republic of China cement, clinker and related products Zhejiang YTL Cement Marketing The People’s Sale & marketing of cementitious products 98.03 98.03 Co., Ltd.* Republic of China

Held through YTL Charters Sdn. Bhd. Island Air Sdn. Bhd. Malaysia Chartering of aircrafts 80.00 80.00 Nusantara Sakti Sdn. Bhd. Malaysia Carriage of passengers & air carriers 80.00 80.00

Held through YTL e-Solutions Berhad Airzed Services Sdn. Bhd. Malaysia Inactive 56.00 56.00 Airzed Broadband Sdn. Bhd. Malaysia Providing wired line & wireless broadband 70.00 70.00 internet access services & developing, producing, marketing, selling & maintaining software applications, research & development, consultancy & related services Bizsurf MSC Sdn. Bhd. Malaysia Inactive 60.00 60.00 Infoscreen Networks Ltd.* England & Wales Investment holding 100.00 100.00 PropertyNetAsia (Malaysia) Sdn. Bhd. Malaysia Inactive 100.00 100.00 YTL Info Screen Sdn. Bhd. Malaysia Creating, providing & advertising content, 100.00 100.00 media, web media & up to date information via electronic media YMax Sdn. Bhd. Malaysia Inactive 100.00 100.00 Y-Max Networks Sdn. Bhd. Malaysia Providing computer networking & related 60.00 60.00 information technology services Y-Max Solutions Holdings Sdn. Bhd. Malaysia Investment holding 100.00 100.00

185 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL (Guernsey) Limited: YTL Construction (SA) (Proprietary) Ltd.‡ South Africa Inactive 100.00 100.00

Held through YTL Hospitality REIT (“YTL REIT”): Starhill Hospitality (Australia) Pty. Ltd.* Australia Trustee company 56.95 56.95 Starhill Hospitality REIT (Australia) Australia Real estate investment 56.95 56.95 Trust* Starhill Hospitality REIT (Brisbane) Australia Real estate investment 56.95 56.95 Trust* Starhill Hospitality REIT (Melbourne) Australia Real estate investment 56.95 56.95 Trust* Starhill Hospitality REIT (Sydney) Trust* Australia Real estate investment 56.95 56.95 Starhill Hospitality REIT (Australia) Sdn. Malaysia Investment holding 56.95 56.95 Bhd. Starhill Hotel (Australia) Sdn. Bhd. Malaysia Investment holding 56.95 56.95 Starhill Hotel (Brisbane) Pty. Ltd.* Australia Hotel operator 56.95 56.95 Starhill Hotel (Melbourne) Pty. Ltd.* Australia Hotel operator 56.95 56.95 Starhill Hotel (Sydney) Pty. Ltd.* Australia Hotel operator 56.95 56.95 Starhill REIT (Australia) Pty. Ltd.* Australia Trustee company 56.95 56.95 Starhill REIT Niseko G.K.* Japan Purchase, possession, disposal, lease and 56.95 56.95 management of real properties YTL REIT MTN Sdn. Bhd. Malaysia To undertake the issuance of medium term 56.95 56.95 notes

Held through YTL Hotels & Properties Sdn. Bhd.: Autodome Sdn. Bhd. Malaysia Operator of food & beverage outlets & 100.00 100.00 sub-letting of premises Bath Hotel & SPA B.V.* Netherlands Investment holding 100.00 100.00 Bath Hotel and SPA Ltd.* England & Wales Hotel developer and operator 100.00 100.00 Borneo Cosmeceutical Sdn. Bhd. Malaysia Development of holiday resorts 90.00 90.00

186 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Hotels & Properties Sdn. Bhd.: (cont’d.) Borneo Island Villas Sdn. Bhd. Malaysia Dormant 80.00 80.00 Cameron Highlands Resort Sdn. Bhd. Malaysia Hotel & resort operator 100.00 100.00 Diamond Recipe Sdn. Bhd. Malaysia Operator of food & beverage outlet 100.00 51.00 Elite Dinning Sdn. Bhd.† Malaysia Operator of food & beverage outlet 100.00 – Gainsborough Hotel (Bath) Limited* England & Wales Hotel operations 100.00 100.00 Glasshouse Hotel (Cayman) Limited* Cayman Islands Investment holding 100.00 100.00 Glasshouse Hotel Limited* England & Wales Investment holding 100.00 100.00 Happy Steamboat Sdn. Bhd. Malaysia Inactive 100.00 100.00 Magna Boundary Sdn. Bhd. Malaysia Hotel & resort operator 90.00 90.00 Marble Valley Sdn. Bhd. Malaysia Management & investment holding 80.00 80.00 Marble Valley Two Sdn. Bhd. Malaysia Hotel operator 64.00 64.00 M Hotel Management Pte. Ltd.* Singapore Hotel management services 51.00 51.00 Monkey Island Properties Limited* England & Wales Investment & property holding 100.00 100.00 New Architecture (Bray) Limited* England & Wales Hotel operator 100.00 100.00 Niseko Village K.K.‡ Japan Owning, managing, maintaining and 100.00 100.00 developing the Niseko Village Resort Niseko Village (S) Pte. Ltd.* Singapore Investment holding 100.00 100.00 N.V. Land G.K.‡ Japan Construction, development, sale & purchase 100.00 100.00 of real properties P.T. Jepun Bali‡ Indonesia Managing & operating a hotel 100.00 100.00 Restoran Kisap Sdn. Bhd. Malaysia Inactive 100.00 100.00 RW Gower Street Limited* England & Wales Hotel operations 100.00 100.00 RW Greenside Place Limited* England & Wales Hotel operations 100.00 100.00 RW Threadneedle Street Limited* England & Wales Hotel operations 100.00 100.00 Samui Hotel 2 Co., Ltd.* Thailand Hotel operator 100.00 100.00 Sentul Park Koi Centre Sdn. Bhd. Malaysia Breeders, wholesalers, retailers & distributors 100.00 100.00 of koi fish Starhill Hotel (Perth) Pty. Ltd‡ Australia Trustee company 100.00 100.00 Starhill Hotel (Perth) Sdn. Bhd. Malaysia Investment holding 100.00 100.00

187 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Hotels & Properties Sdn. Bhd.: (cont’d.) Starhill Hotel (Perth) Trust* Australia Real estate investment 100.00 100.00 Starhill Hotel Operator (Perth) Pty. Ltd.* Australia Hotel operator 100.00 100.00 Starhill Office (Perth) Pty. Ltd. ‡ Australia Trustee company 100.00 100.00 Starhill Office (Perth) Trust ‡ Australia Real estate investment – 100.00 Starhill Retail (Perth) Pty. Ltd. ‡ Australia Trustee company 100.00 100.00 Starhill Retail (Perth) Trust ‡ Australia Real estate investment – 100.00 Star Hill Hotel Sdn. Bhd. Malaysia Hotel operator 100.00 100.00 Thermae Development Company England & Wales Licence to operate the Thermae Bath Spa 100.00 100.00 Limited* complex Threadneedles Hotel Limited* England & Wales Investment holding 100.00 100.00 YTL Heritage Hotels Sdn. Bhd. Malaysia Dormant 100.00 100.00 YTL Hotels B.V. ‡ Netherlands Investment holding 100.00 100.00

YTL Hotels (Cayman) Limited ‡ Cayman Islands Hotel operator & hotel management 100.00 100.00 services YTL Hotels Central Services Sdn. Bhd. Malaysia Dormant 100.00 100.00 YTL ICHM Sdn. Bhd. Malaysia Providing professional & commercial 70.00 70.00 education & training in hospitality YTL Hotels (Singapore) Pte. Ltd.* Singapore Travel and hospitality related business 100.00 100.00 YTL Majestic Hotel Sdn. Bhd. Malaysia Hotel operator 100.00 100.00

Held through YTL Industries Berhad: Yeoh Tiong Lay Brickworks Sdn. Bhd. Malaysia Inactive 100.00 100.00 Yeoh Tiong Lay Management Sdn. Bhd. Malaysia Dormant 100.00 100.00

Held through YTL Land Sdn. Bhd.: Katagreen Development Sdn. Bhd. Malaysia Property leasing and management 100.00 100.00 Pintar Projek Sdn. Bhd. Malaysia Management of real estate investment 70.00 70.00 trust funds, licensing of trademarks & brand management

188 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Land Sdn. Bhd.: (cont’d.) Puncak Serunding Sdn. Bhd. Malaysia Dormant 100.00 100.00 Heritage Journey Sdn. Bhd. Malaysia Operator of food and beverage 100.00 100.00 YTL Design Services Sdn. Bhd. Malaysia Dormant 100.00 100.00

Held through YTL Land & Development Berhad: Amanresorts Sdn. Bhd. Malaysia Dormant 96.60 65.26 Bayumaju Development Sdn. Bhd. Malaysia Property development 96.60 65.26 Budaya Bersatu Sdn. Bhd. Malaysia Property development 96.60 65.26 Emerald Hectares Sdn. Bhd. Malaysia Dormant 67.62 45.68 Lakefront Pte. Ltd.* Singapore Real estate development 96.60 65.26 Lot Ten Security Sdn. Bhd.* Malaysia Inactive 96.60 65.26 Mayang Sari Sdn. Bhd.* Malaysia Inactive 96.60 65.26 Noriwasa Sdn. Bhd. Malaysia Dormant 96.60 65.26 Pakatan Perakbina Sdn. Bhd. Malaysia Property development 96.60 65.26 Pinnacle Trend Sdn. Bhd. Malaysia Property development 96.60 65.26 PYP Sendirian Berhad Malaysia Property development 96.60 65.26 Sandy Island Pte. Ltd.* Singapore Real estate development 96.60 65.26 Satria Sewira Sdn. Bhd. Malaysia Dormant 96.60 65.26 Sentul Raya Sdn. Bhd.* Malaysia Property development and property 96.60 65.26 investment Sentul Raya Golf Club Berhad* Malaysia Inactive 96.60 65.26 Sentul Raya City Sdn. Bhd.* Malaysia Property development 96.60 65.26 Sentul Park Management Sdn. Bhd.* Malaysia Park management 96.60 65.26 SR Property Management Sdn. Bhd.* Malaysia Provision of property management services 96.60 65.26 Syarikat Kemajuan Perumahan Negara Malaysia Property development 96.60 65.26 Sdn. Bhd. Trend Acres Sdn. Bhd. Malaysia Property development 96.60 65.26 Udapakat Bina Sdn. Bhd. Malaysia Property development 96.60 65.26 YTL Land & Development (MM2H) Malaysia Dormant 96.60 65.26 Sdn. Bhd.*

189 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Land & Development Berhad: (cont’d.) YTL Land & Development Management Singapore Provision of financial and management 96.60 65.26 Pte. Ltd.* consultancy services YTL Westwood Properties Pte. Ltd.* Singapore Real estate development 96.60 65.26

Held through YTL Power International Berhad (“YTL Power”): Albion Water Limited* England & Wales Water supply and waste water services 28.16 28.16 Bel Air Den Haag Beheer B.V.* Netherlands Investment holding 45.75 55.21 Brabazon Estates Limited † England & Wales Dormant 55.21 – B.V. Hotel Bel Air Den Haag* Netherlands Hotel business 45.75 55.21 Cellular Structures Sdn. Bhd.* Malaysia Inactive 33.13 33.13 Enterprise Laundry Services Limited* England & Wales Laundry services 55.21 55.21 Equinox Solar Farm Sdn. Bhd. Malaysia Development, ownership, operation and 55.21 – maintenance of solar photovoltaic power plants and related engineering, procurement, construction and commissioning services Extiva Communications Sdn. Bhd. Malaysia Inactive 33.13 33.13 Flipper Limited* England & Wales Utility switching services 35.89 35.89 FrogAsia Sdn. Bhd. Malaysia Licence reseller focused on providing virtual 55.21 55.21 learning education platform Frog Education Limited* England & Wales Sales into the education market and further 38.06 38.06 development of the web environment product Frog Education Group Limited* England & Wales Investment holding 38.06 38.06 Frog Education Sdn. Bhd. Malaysia License reseller focused on providing virtual 38.06 38.06 learning educational platform Geneco EV (S) Pte. Ltd.* Singapore Electric vehicle charging station 55.21 55.21 Geneco Limited* England & Wales Food waste treatment 55.21 55.21

190 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Power International Berhad (“YTL Power”): (cont’d.) Geneco (South West) Limited* England & Wales Food waste treatment 55.21 55.21 Global Infrastructure Assets Sdn. Bhd. Malaysia Investment holding 55.21 55.21 Granite Investments (Cayman Islands) Cayman Islands Dormant 55.21 55.21 Limited‡ KJS Alunan Sdn. Bhd.* Malaysia Investment holding 23.19 23.19 Konsortium Jaringan Selangor Sdn. Malaysia Planning, implementation and maintenance 33.13 33.13 Bhd.* of telecommunication towers and telecommunication related services PetroSeraya Pte. Ltd.* Singapore Oil trading & oil tank leasing 55.21 55.21 P.T. YTL Jawa Timur* Indonesia Construction management, consultancy 55.21 55.21 services and power station operation services P.T. YTL Power Services Indonesia‡ Indonesia Dormant 52.45 52.45 P.T. Tanjung Jati Power Company* Indonesia Design and construction of a coal-fired 44.17 44.17 power generating facility Seraya Energy and Investment Pte. Singapore Investment holding 55.21 55.21 Ltd.* Seraya Energy Pte. Ltd.* Singapore Sale of electricity 55.21 55.21 SC Technology Deutschland GmbH* Germany Waste treatment 55.21 55.21 SC Technology GmbH* Switzerland Investment holding 55.21 55.21 SC Technology Nederland B.V.* Netherlands Waste treatment 55.21 55.21 SIPP Power Sdn. Bhd. Malaysia Dormant 38.65 38.65 Suria Solar Farm Sdn. Bhd. Malaysia Development, ownership, operation and 55.21 – maintenance of solar photovoltaic power plants and related engineering procurement, construction and commissioning services Sword Bidco (Holdings) Limited^ England & Wales Dormant – 55.21 Sword Bidco Limited^ England & Wales Dormant – 55.21 Sword Holdings Limited^ Cayman Islands Dormant – 55.21

191 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Power International Berhad (“YTL Power”): (cont’d.) Sword Midco Limited^ England & Wales Dormant – 55.21 Taser Power Pte. Ltd.† Singapore Own and operate energy facilities and 55.21 – services (full value chain of electricity generation including trading of physical fuel and fuel related derivative instruments, and sale of by-products from the electricity generation process) Water 2 Business Limited* England & Wales Non-household water retailer 38.65 38.65 Wessex Concierge Limited* England & Wales Investment holding 55.21 55.21 Wessex Electricity Utilities Limited^ England & Wales Dormant – 55.21 Wessex Engineering & Construction England & Wales Engineering services 55.21 55.21 Services Limited* Wessex Logistics Limited ^ England & Wales Dormant – 55.21 Wessex Promotions Ltd.^ England & Wales Dormant – 55.21 Wessex Property Services Limited^ England & Wales Dormant – 55.21

Wessex Spring Water Limited^ England & Wales Dormant – 55.21 Wessex Water Commercial Limited^ England & Wales Dormant – 55.21 Wessex Water Engineering Services England & Wales Dormant 55.21 55.21 Limited ‡ Wessex Water Enterprises Limited* England & Wales Power generation and waste treatment 55.21 55.21 Wessex Water International Limited ‡ Cayman Islands Dormant 55.21 55.21 Wessex Water Limited* England & Wales Investment holding 55.21 55.21 Wessex Water Pension Scheme Trustee England & Wales Dormant 55.21 55.21 Limited ‡ Wessex Water Services Finance Plc.* England & Wales Issue of bonds 55.21 55.21 Wessex Water Services Limited* England & Wales Water supply and waste water services 55.21 55.21 Wessex Water Trustee Company England & Wales Dormant 55.21 55.21 Limited ‡ Wessex Utility Solutions Limited* England & Wales Engineering services 55.21 55.21

192 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Power International Berhad (“YTL Power”): (cont’d.) Yakin Telesel Sdn. Bhd.* Malaysia Planning, implementation and maintenance 16.23 16.23 of telecommunications infrastructure and telecommunication related services YesLinc Sdn. Bhd. Malaysia Provision of solution and services relating 33.13 33.13 to internet of Things (IoT) initiative YTL Broadband Sdn. Bhd. Malaysia Provision of wired line and wireless 26.50 26.50 broadband access and other related services YTL Communications International Cayman Islands Investment holding 33.13 33.13 Limited ‡

YTL Communications Sdn. Bhd. Malaysia Provision of wired line and wireless 33.13 33.13 broadband access and other related services YTL Communications (S) Pte. Ltd.* Singapore Computer systems integration activities 33.13 33.13 and system integration services YTL Developments (UK) Limited* England & Wales Housing development 55.21 55.21 YTL Digital Sdn. Bhd. Malaysia Inactive 33.13 33.13 YTL Education (UK) Limited ‡ England & Wales Dormant 55.21 55.21 YTL Energy Holdings Sdn. Bhd. Malaysia Investment holding 55.21 55.21 YTL Engineering Limited ‡ England & Wales Dormant 55.21 55.21 YTL Events Limited* England & Wales Concert promotion 55.21 55.21 YTL Finance (Cyprus) Ltd † Cyprus Financial Services 55.21 – YTL Global Networks Limited ‡ Cayman Islands Dormant 33.13 33.13 YTL Homes Ltd.* England & Wales Housing development 55.21 55.21

193 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Power International Berhad (“YTL Power”): (cont’d.) YTL Infrastructure Holdings Sdn. Bhd. Malaysia Investment holding 55.21 55.21 YTL Infrastructure Limited ‡ Cayman Islands Investment holding 55.21 55.21 YTL Jawa Energy B.V. Netherlands Investment holding and financing activities 55.21 55.21 YTL Jawa O & M Holdings B.V. Netherlands Investment holding 55.21 55.21

YTL Jawa O & M Holdings Limited* Cyprus Investment holding 55.21 55.21 YTL Jawa Power B.V. Netherlands Investment holding 31.55 31.55 YTL Jawa Power Finance Limited ‡ Cayman Islands Financial services 55.21 55.21 YTL Jawa Power Holdings B.V. Netherlands Investment holding 31.55 31.55 YTL Jawa Power Holdings Limited* Cyprus Investment holding & financing activities 55.21 55.21 YTL Jordan Power Holdings Limited* Cyprus Investment holding & financing activities 55.21 55.21 YTL Jordan Services Holdings Limited* Cyprus Investment holding 55.21 55.21 YTL Land & Property (UK) Ltd.* England & Wales Investment holding 55.21 55.21 YTL Places Limited ‡ England & Wales Dormant 55.21 55.21 YTL Power Australia Limited ‡ Cayman Islands Investment holding 55.21 55.21 YTL Power Finance (Cayman) Limited ‡ Cayman Islands Dormant 55.21 55.21 YTL Power Generation Sdn. Bhd.* Malaysia Developing, constructing, completing, 55.21 55.21 maintaining and operating power plants YTL Power Holdings Sdn. Bhd. Malaysia Dormant 55.21 55.21 YTL Power Investments Limited ‡ Cayman Islands Investment holding 55.21 55.21 YTL Power International Holdings Cayman Islands Investment holding 55.21 55.21 Limited ‡ YTL Power Resources Sdn. Bhd. Malaysia Investment holding 55.21 55.21

194 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Power International Berhad (“YTL Power”): (cont’d.) YTL PowerSeraya Pte. Limited.* Singapore Own and operate energy facilities and 55.21 55.21 services (full value chain of electricity generation including trading of physical fuels and fuel related derivative instruments, tank leasing activities and sale of by-products from the electricity generation process) YTL Power (Thailand) Limited ‡ Cayman Islands Dormant 55.21 55.21 YTL Power Trading (Labuan) Ltd. Malaysia Dormant 55.21 55.21 YTL Property Holdings (UK) Limited* England & Wales Housing development 55.21 55.21 YTL Seraya Limited ‡ Cayman Islands Investment holding 55.21 55.21 YTL Services Limited ‡ England & Wales Dormant 55.21 55.21 YTL SIPP Power Holdings Sdn. Bhd. Malaysia Investment holding 38.65 38.65 YTL Utilities Limited ‡ Cayman Islands Investment holding 55.21 55.21 YTL Utilities Finance Limited ‡ Cayman Islands Financial services 55.21 55.21 YTL Utilities Finance 2 Limited ‡ Cayman Islands Investment holding 55.21 55.21 YTL Utilities Finance 3 Limited ‡ Cayman Islands Financial services 55.21 55.21 YTL Utilities Finance 4 Limited ‡ Cayman Islands Inactive 55.21 55.21 YTL Utilities Finance 5 Limited ‡ Cayman Islands Inactive 55.21 55.21 YTL Utilities Finance 6 Limited ‡ Cayman Islands Financial services 55.21 55.21 YTL Utilities Finance 7 Limited ‡ Cayman Islands Inactive 55.21 55.21

YTL Utilities Holdings Limited ‡ Cayman Islands Investment holding 55.21 55.21 YTL Utilities Holdings (S) Pte. Limited* Singapore Investment holding 55.21 55.21 YTL Utilities (S) Pte. Limited* Singapore Investment holding 55.21 55.21 YTL Utilities (UK) Limited* England & Wales Investment holding 55.21 55.21

195 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

Details of the subsidiaries are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Power Services Sdn. Bhd.: YTL Power Services (Cayman) Ltd. ‡ Cayman Islands Inactive 100.00 100.00 YTL Power Services (Leb) SARL* Lebanon Operation & maintenance of power station 100.00 100.00 YTL Power Services (S) Pte. Ltd.* Singapore Operation & maintenance of power station 100.00 100.00

Held through YTL Singapore Pte. Ltd.: Guangzhou Autodome Food & Beverage The People’s Catering management & hotel management 100.00 100.00 Management Co., Ltd.* Republic of China Shanghai Autodome Food & Beverage The People’s Catering, sale of beverage, wine, tableware, 100.00 100.00 Co., Ltd.* Republic of China souvenir & artware Shanghai YTL Hotels Management The People’s Hotel management services, hotel – 100.00 Co., Ltd.*^ Republic of China development, design advisory services & other related services

* Subsidiaries not audited by HLB Ler Lum PLT ^ Dissolved during the financial year ‡ Entities are either exempted or not statutorily required to be audited @ These subsidiaries have changed their financial year end from 31 December to 30 June effective from 18 November 2019. † First audited financial statements in 2021 # Previously was an associated company and become a subsidiary during the financial year. § Previously was a subsidiary and became an associated company during the financial year.

196 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

(a) Acquisition of subsidiaries

Acquisition in 2020

(i) Acquisition of Fico Tay Ninh Cement Joint Stock Company

On 2 August 2019, Concrete Star Limited (“Concrete Star”) and Industrial Procurement Limited (“Industrial Procurement”), both are wholly-owned subsidiaries of YTL Cement (Hong Kong) Limited which in turn is a wholly-owned subsidiary of the Company, acquired 30% and 20% of issued and paid-up share capital of Nhu Anh Investment Joint Stock Company (“Nhu Anh”) comprising 69,000 and 46,000 ordinary shares of VND10,000 each for cash consideration of VND278,400,000,000 and VND185,600,000,000 respectively. As a result, Nhu Anh became an indirect subsidiary of the Company.

Following the acquisition, Fico Tay Ninh Cement Joint Stock Company (“Fico Tay Ninh Cement”) and its subsidiary, Fico Binh Duong Cement Single Member Limited Liability Company became indirect subsidiaries of the Company through the shareholdings by Nhu Anh and Industrial Procurement.

Details of the consideration transferred are:

RM’000

Purchase consideration 715,178

Less: share of net assets acquired Fair value of net assets acquired 655,448 Share to non-controlling interests (141,450)

513,998

Provisional goodwill 201,180

The provisionally determined fair values of the assets and liabilities as at the date of acquisition are as follows:

Fair value RM’000

Property, plant and equipment 333,293 Intangible assets 3,394 Investment in associated company 872 Other investments 180,291 Deferred tax assets 282 Inventories 40,539 Receivables 24,973 Cash and cash equivalents 101,640 Other assets 36,823 Payables and accrued expenses (66,659)

Identifiable net assets acquired 655,448

197 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

(a) Acquisition of subsidiaries (cont’d.)

Acquisition in 2020 (cont’d.)

(i) Acquisition of Fico Tay Ninh Cement Joint Stock Company (cont’d.)

Details of cash flow arising from the acquisition are as follows:

RM’000

Purchase consideration 715,178 Transfer of cost of investment in former associates now became subsidiaries (632,515)

Additional purchase consideration 82,663 Less: cash and cash equivalents in subsidiary acquired (101,640)

Acquisition of a subsidiary, net of cash acquired 18,977

Acquisition in 2019

(i) Acquisition of Lafarge Malaysia Berhad (“LMB”)

On 2 May 2019 , YTL Cement Berhad (“YTL Cement”) entered into a sale and purchase of shares agreement with Associated International Cement Limited for the acquisition of 433,344,693 ordinary shares in Lafarge Malaysia Berhad (“LMB”), representing approximately 51.0% of the issued share capital of LMB for a total cash consideration of RM1,625,042,598.75 or RM3.75 per LMB Share (“Acquisition”).

The Acquisition was completed on 17 May 2019 and, accordingly, LMB became a subsidiary of YTL Cement. Following the Acquisition, YTL Cement launched an unconditional mandatory general offer (“MGO”) for the remaining shares in LMB not already owned by YTL Cement at an offer price of RM3.75 per LMB share. At the closing of the MGO on 13 June 2019, acceptance of the offer have been received for 220,764,635 shares with a total cash consideration of RM827,867,381. As a result, YTL Cement owned a total of 76.98% of the issued share capital of LMB.

Details of the consideration transferred are:

RM’000

Purchase consideration 2,452,910

Less: share of net assets acquired Fair value of net assets acquired 2,466,070 Share goodwill to non-controlling interests (248,360)

2,217,710

Provisional goodwill 235,200

198 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

(a) Acquisition of subsidiaries (cont’d.)

Acquisition in 2019 (cont’d.)

(i) Acquisition of Lafarge Malaysia Berhad (“LMB”) (cont’d.)

The provisionally determined carrying amount of the assets and liabilities as at the date of acquisition are as follows:

Carrying amount RM’000

Property, plant and equipment 1,677,633 Investment properties 4,467 Intangible assets 1,404,349 Investment in joint ventures 22,332 Other investments 4,107 Deferred tax assets 72,027 Inventories 353,639 Receivables 398,351 Income tax assets 42,970 Cash and cash equivalents 48,938 Payables and accrued expenses (571,838) Borrowings (929,835) Retirement benefits (54,816) Derivative financial instruments 160 Non-controlling interests (6,414)

Identifiable net assets acquired 2,466,070

Details of cash flow arising from the acquisition are as follows:

RM’000

Purchase consideration 2,452,910 Less: cash and cash equivalents in subsidiary acquired (48,938)

Net cash outflow on acquisition 2,403,972

199 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

(a) Acquisition of subsidiaries (cont’d.)

Acquisition in 2019 (cont’d.)

(ii) Holcim (Singapore) Limited (“Holcim”)

On 19 June 2019, YTL Cement Singapore Pte. Ltd. (“YTL Cement Singapore”), a wholly-owned subsidiary of YTL Cement Berhad, acquired 90.78% of the issued share capital of Holcim (Singapore) Limited (“HSL”), comprising 40,236,655 ordinary shares, at a total cash consideration of SGD65,988,114.20. As a result, HSL became a subsidiary of YTL Cement Singapore and an indirect subsidiary of the Group.

Details of the consideration transferred are:

RM’000

Purchase consideration 201,950

Less: share of net assets acquired Fair value of net assets acquired 17,090 Share goodwill to non-controlling interests (1,576)

15,514

Provisional goodwill 186,436

The provisionally determined carrying amount of the assets and liabilities as at the date of acquisition are as follows:

Fair value RM’000

Property, plant and equipment 68,597 Inventories 5,387 Receivables 18,008 Cash and cash equivalents 8,650 Payables and accrued expenses (34,586) Borrowings (48,966)

Identifiable net assets acquired 17,090

200 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

(a) Acquisition of subsidiaries (cont’d.)

Acquisition in 2019 (cont’d.)

(ii) Holcim (Singapore) Limited (“Holcim”) (cont’d.)

Details of cash flow arising from the acquisition are as follows:

RM’000

Purchase consideration 201,950 Less: cash and cash equivalents in subsidiary acquired (8,650)

Net cash outflow on acquisition 193,300

The purchase price allocation of the acquisition of Lafarge Malaysia Berhad and Holcim (Singapore) Ltd in the financial year ended 30 June 2019 were provisional as the Group is still in the process of ascertaining the fair value of the identifiable net assets.

(ii) Completion of purchase price allocation for Lafarge Malaysia Berhad and Holcim (Singapore) Limited

During the year 2020, the Group has completed the purchase price allocation exercise to determine the fair values of the net assets of Lafarge Malaysia Berhad and Holcim (Singapore) Limited within the stipulated time period, ie 12 months from the acquisition date of 17 May 2019, in accordance with MFRS 3 “Business Combinations”.

The information are as follows:-

Lafarge Holcim Malaysia (Singapore) Berhad Limited RM’000 RM’000

Purchase consideration 2,452,910 201,950 Less: net assets acquired after less non-controlling interests (2,192,135) (794)

Final goodwill 260,775 201,156

Due to immaterial difference between final and provisional goodwill, the Group used prospective method instead of retrospective method on the adjustment of goodwill.

201 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

(b) Derecognition of SGREIT

Since April 2020, The Group has provided an undertaking to the trustee of SGREIT to grant the other unitholders the right to endorse or re-endorse the appointment of directors of YTL Starhill Global REIT Management Limited at the annual general meetings of SGREIT. The Group has determined that it does not have control over SGREIT but continues to have significant influence over the investment.

At date of disposal RM’000

Property, plant equipment 60 Investment properties 9,244,013 Right-of-use assets 2,030 Trade and other receivables 45,571 Derivative financial instruments 2,349 Cash and cash equivalents 245,871 Trade and other payables (219,235) Bonds and borrowings (3,493,431) Lease liabilities (2,053) Deferred tax liabilities (19,348) Derivative financial instruments (54,814) Income tax liabilities (9,639)

Net assets and liabilities 5,741,374

Share of net assets derecognition of 2,109,770 Foreign exchange reserve (256,748) Gain on derecognition to the Group 258,506

Total consideration/recognition on associate company 2,111,528

The net cash flows on derecognition is determined as follows:

Cash and cash equivalents of derecognised subsidiary (245,871)

Cash outflow to the Group on derecognition (245,871)

202 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

(c) Non-controlling interests in subsidiaries

The Group’s subsidiaries that have material non-controlling interests (“NCI”) are as follows:

Other Malayan individually YTL Power SGREIT YTL REIT Cement immaterial Group Group Group Berhad subsidiaries Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020 NCI effective equity interest 44.79% -% 43.05% 23.02%

Carrying amount of NCI 1,884,214 – 696,741 208,172 360,466 3,149,593

(Loss)/Profit allocated to NCI (41,527) 24,603 17,276 (31,150) 44,632 13,834

Summarised financial information before inter-company elimination As at 30 June 2020 Non-current assets 35,685,632 – 4,499,243 3,044,454 Current assets 11,452,503 – 194,293 585,797 Non-current liabilities (25,418,661) – (2,037,464) (243,197) Current liabilities (9,676,720) – (100,173) (1,095,706)

Net assets 12,042,754 – 2,555,899 2,291,348

Year ended 30 June 2020 Revenue 10,637,177 435,212 426,446 1,399,476 Profit/(loss) for the year 127,704 174,354 9,594 (133,136) Total comprehensive (loss)/income (130,651) 38,558 (66,811) (134,534)

Cash flow from operating activities 1,121,786 302,696 185,381 93,769 Cash flow used in investing activities (1,517,957) (74,709) (8,624) (24,791) Cash flow used in financing activities (328,076) (201,991) (184,305) (49,640)

Net changes in cash and cash equivalents (724,247) 25,996 (7,548) 19,338

Dividend paid to NCI 171,879 138,495 43,235 –

203 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

15. INVESTMENT IN SUBSIDIARIES (CONT’D.)

(c) Non-controlling interests in subsidiaries (cont’d.)

The Group’s subsidiaries that have material non-controlling interests (“NCI”) are as follows: (cont’d.)

Other Malayan individually YTL Power SGREIT YTL REIT Cement immaterial Group Group Group Berhad subsidiaries Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2019 NCI effective equity interest 44.79% 63.54% 43.05% 23.02%

Carrying amount of NCI 2,637,806 3,741,188 716,437 246,378 290,046 7,631,855

Profit/(loss) allocated to NCI 270,738 198,445 44,125 (3,378) (33,402) 476,528

Summarised financial information before inter-company elimination As at 30 June 2019 Non-current assets 34,168,822 9,379,782 4,681,459 3,432,128 Current assets 12,104,156 235,935 183,318 1,008,743 Non-current liabilities (23,275,311) (3,208,684) (1,017,356) (323,255) Current liabilities (10,127,005) (500,398) (1,110,321) (1,573,537)

Net assets 12,870,662 5,906,635 2,737,100 2,544,079

Year ended 30 June 2019 Revenue 11,732,716 623,355 490,905 162,022 Profit/(loss) for the year 613,528 198,282 104,673 (17,294) Total comprehensive income/(loss) 414,374 312,310 152,743 (17,155)

Cash flow from/(used in) operating activities 1,248,400 293,749 221,676 (9,355) Cash flow from/(used in) investing activities 137,412 (23,202) (347,693) (2,365) Cash flow (used in)/from financing activities (1,267,562) (247,234) 120,382 –

Net changes in cash and cash equivalents 118,250 23,313 (5,635) (11,720)

Dividend paid to NCI 171,879 183,212 56,005 –

204 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

16. INVESTMENT IN ASSOCIATES

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Quoted shares, at cost 2,111,715 – 170,994 – Unquoted ordinary shares, at cost 1,324,168 1,743,643 205,241 205,241 Share of post-acquisition reserves 849,170 902,538 – – Accumulated impairment losses (68,210) (65,016) – –

4,216,843 2,581,165 376,235 205,241

Details of the associate are as follows:

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held by the Company: Express Rail Link Sdn. Bhd.* Malaysia Operation & maintenance of the Express 45.00 45.00 Rail Link railway system between Kuala Lumpur International Airport and Kuala Lumpur International Airport 2 in Sepang with Kuala Lumpur Sentral Station Trans-Pacific Resorts Sdn. Bhd. Malaysia Inactive 50.00 50.00

Held through Business & Budget Hotels Sdn. Bhd.: Business & Budget Hotels (Kuantan) Malaysia Hotel operator 50.00 50.00 Sdn. Bhd.

Held through Syarikat Pembenaan Yeoh Tiong Lay Sdn. Bhd.: North South Development Sdn. Bhd. Malaysia Realty, investment & management services 49.00 49.00

Held through YTL Cayman Limited: YTL (Thailand) Limited* Thailand Investment holding 49.90 49.90 Starhill Global Real Estate Investment Singapore Investment in prime real estate 36.74 – Trust*§

Held through YTL Cement Berhad: Cementitious Products Pte. Ltd.* Singapore General wholesale trade (including general 49.01 49.01 importers and exporters) Fico Tay Ninh Cement Joint Stock Vietnam Manufacture & sale of ordinary portland – 49.04 Company*# cement & blended cement

205 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

16. INVESTMENT IN ASSOCIATES (CONT’D.)

Details of the associate are as follows: (cont’d.)

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Cement Berhad: (cont’d.) Hangzhou Linan Herun Construction The People’s Quarry business & related services 29.40 29.40 Materials Co., Ltd* Republic of China Nhu Anh Investment Joint Stock Vietnam Investment holding – 49.01 Company*# Superb Aggregates Sdn. Bhd. Malaysia Extraction, removal, processing & sale of 49.01 49.01 sand

Tan Son Company Limited* Vietnam Quarrying of stone, sand & clay 20.58 –

Held through YTL e-Solutions Berhad: Endless Momentum Sdn. Bhd. Ω Malaysia Investment holding 30.00 30.00

Held through YTL Hotels & Properties Sdn. Bhd.: Eastern & Oriental Express Ltd. Ω* Bermuda Ownership & management of the luxury 32.00 32.00 train services known as the ‘Eastern & Oriental Express’ Surin Bay Company Ltd. Ω* Thailand Hotel operator 49.00 49.00 Trans-Pacific Hotels Sdn. Bhd. Malaysia Inactive 50.00 50.00

Held through YTL Power International Berhad: ElectraNet Pty. Ltd.+* Australia Principal electricity transmission 18.50 18.50 Enefit Jordan B.V. ‡ Netherlands Investment holding 16.56 16.56 P.T. Jawa Power+* Indonesia Operating a coal-fired thermal power station 11.04 11.04

* Companies not audited by HLB Ler Lum PLT Ω Companies with financial year end of 31 December ‡ Entities are either exempted or not statutorily required to be audited + The Group’s direct interest in ElectraNet Pty. Ltd. and P.T. Jawa Power are 33.5% and 35.0% respectively # Previously was an associated company and became a subsidiary during the financial year § Previously was a subsidiary and became an associated company during the financial year

As indicated above, the financial year end of certain associated companies are not co-terminous with that of the Group. For the purpose of applying the equity method of accounting, these companies’ unaudited financial statements made up to 30 June were used in conjunction with their audited financial statements for the financial year ended 31 December as the case may be.

206 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

16. INVESTMENT IN ASSOCIATES (CONT’D.)

The summarised financial information of material associates adjusted for any differences in accounting policies between the Group and the associates and reconciliation to the carrying amount of the Group’s interest in the associates are as follows:

(a) Summarised financial information:

Starhill Global Real Estate Fico Tay Ninh Cement P.T. Jawa Power ElectraNet Pty. Ltd. Investment Trust Joint Stock Company

2020 2019 2020 2019 2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Non-current assets 4,543,425 4,446,818 10,879,751 9,670,335 9,035,122 – – 373,817 Current assets 1,048,472 1,074,410 147,284 127,112 429,202 – – 162,045 Non-current liabilities (562,414) (815,962) (8,769,136) (7,087,636) (3,400,846) – – (900) Current liabilities (282,964) (269,317) (923,519) (1,453,774) (627,963) – – (66,657)

Net assets 4,746,519 4,435,949 1,334,380 1,256,037 5,435,515 – – 468,305

Profit/(loss) for the financial year 1,159,080 899,088 79,229 122,925 (472,072) – – 30,774 Other comprehensive loss – – (21,757) (179,855) (860) – – –

Total comprehensive income/(loss) 1,159,080 899,088 57,472 (56,930) (472,932) – – 30,774

Included in the total comprehensive income is: Revenue 2,296,168 2,365,529 1,088,992 1,150,574 113,671 – – 212,577

Other information: Dividends received from associate 349,682 385,772 – – – – – 7,974

207 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

16. INVESTMENT IN ASSOCIATES (CONT’D.)

The summarised financial information of material associates adjusted for any differences in accounting policies between the Group and the associates and reconciliation to the carrying amount of the Group’s interest in the associates are as follows: (cont’d.)

(b) Reconciliation of net assets to carrying amount:

Starhill Global Real Estate Fico Tay Ninh Cement P.T. Jawa Power ElectraNet Pty. Ltd. Investment Trust Joint Stock Company Total

2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Opening net assets, 1 July 4,435,949 4,524,039 1,256,037 1,347,235 – – – 210,640 5,691,986 6,081,914 Effect of a former subsidiary became an associated company – – – – 5,741,374 – – – 5,741,374 – Increase in equity – – – – 5,807 – – 251,472 5,807 251,472 Profit/(loss) for the financial year 1,159,080 899,088 79,229 122,925 (471,044) – – 30,774 767,265 1,052,787 Other comprehensive (loss)/income – – (21,757) (179,855) 159,501 – – – 137,744 (179,855) Foreign exchange differences 150,581 115,027 20,871 (34,268) (123) – – 1,795 171,329 82,554 Dividend paid (999,091) (1,102,205) – – – – – (26,376) (999,091) (1,128,581)

Closing net assets, 30 June 4,746,519 4,435,949 1,334,380 1,256,037 5,435,515 – – 468,305 11,516,414 6,160,291

Interest in associates direct hold by subsidiary 35.00% 35.00% 33.50% 33.50% 36.74% –% –% 50.03%

Interest in associate 1,661,282 1,552,582 447,017 420,772 1,997,377 – – 234,293 4,105,676 2,207,647 Goodwill – – – – – – – 15,154 – 15,154

Carrying amount 1,661,282 1,552,582 447,017 420,772 1,997,377 – – 249,447 4,105,676 2,222,801

Goodwill amounting to RM23,357,000 (2019: RM38,511,000) was included in the carrying amount of investment in associated companies.

The individually immaterial associate’s carrying amount is RM111,167,000 (2019: RM358,364,000) and the Group’s share of total comprehensive loss is RM36,176,000 (2019: total comprehensive loss is RM6,090,000).

208 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

17. INVESTMENT IN JOINT VENTURES

Group

2020 2019 RM’000 RM’000

Unquoted ordinary shares, at cost 276,786 265,363 Share of post-acquisition reserves (107,326) 2,209 Accumulated impairment losses (4,286) (3,388)

165,174 264,184

Details of the joint ventures are as follows:

Effective Equity Interest

Place of 2020 2019 Name of Company Incorporation Principal Activities % %

Held through YTL Cement Berhad: Alliance Concrete Singapore Pte. Ltd. Singapore Production and sale of ready-mix concrete 37.73 37.73

Held through YTL Land & Development Berhad: Shorefront Development Sdn. Bhd. Malaysia Property development 48.30 32.63

Held through YTL Power International Berhad: Attarat Mining Company B.V. Netherlands Mining & supply of oil shale 24.84 24.84 Attarat Operation and Maintenance Netherlands Operation & maintenance of Power Plant 24.84 24.84 Company B.V. Attarat Power Holding Company B.V. Netherlands Investment holding and financing activities 24.84 24.84 Bristol Wessex Billing Services Limited England & Wales Billing services 27.61 27.61 Xchanging Malaysia Sdn. Bhd. Malaysia Mobile internet and cloud-based technology 16.57 16.57 solutions

209 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

17. INVESTMENT IN JOINT VENTURES (CONT’D.)

The summarised financial information of material joint ventures adjusted for any differences in accounting policies between the Group and the joint ventures and reconciliation to the carrying amount of the Group’s interest in the joint ventures are as follows:

(a) Summarised financial information:

Attarat Power Holding Attarat Mining Company B.V. Company B.V.

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Non-current assets 8,049,694 6,484,153 9,290 3,251 Current assets 61,145 31,528 337,590 354,220 Non-current liabilities (7,880,832) (5,731,014) – – Current liabilities (310,466) (578,558) (132,650) (125,313)

Net assets (80,459) 206,109 214,230 232,158

(Loss)/Profit for the financial year (35,117) (20,135) 16,844 107,234 Other comprehensive loss (253,294) (198,096) – –

Total comprehensive (loss)/income (288,411) (218,231) 16,844 107,234

Included in the total comprehensive income is: Revenue – – 357,960 475,499

Other information: Dividends received from joint venture – – 18,930 9,278 Cash and cash equivalents 32,457 26,135 26,633 73,868 Shareholders loan and related interest (2,464,519) (1,936,891) – – Bank borrowings (4,976,577) (3,625,914) – – Derivative financial instruments (431,520) (168,208) – –

210 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

17. INVESTMENT IN JOINT VENTURES (CONT’D.)

The summarised financial information of material joint ventures adjusted for any differences in accounting policies between the Group and the joint ventures and reconciliation to the carrying amount of the Group’s interest in the joint ventures are as follows: (cont’d.)

(b) Reconciliation of net assets to carrying amount:

Attarat Power Holdings Attarat Mining Company B.V. Company B.V. Total

2020 2019 2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Opening net assets, 1 July 206,109 59,245 232,158 141,524 438,267 200,769 Increase in equity* – 362,924 – – – 362,924 (Loss)/Profit for the financial year (35,117) (20,135) 16,844 107,234 (18,273) 87,099 Other comprehensive loss (253,294) (198,096) – – (253,294) (198,096) Dividend paid – – (42,067) (20,617) (42,067) (20,617) Foreign exchange differences 1,843 2,171 7,295 4,017 9,138 6,188

Closing net assets, 30 June (80,459) 206,109 214,230 232,158 133,771 438,267

Interest in joint ventures direct hold by subsidiary 45.0% 45.0% 45.0% 45.0% Group’s interest (36,207) 92,749 96,404 104,471 60,197 197,220 Unrecognised share of net assets 36,207 – – – 36,207 –

Carrying amount – 92,749 96,404 104,471 96,404 197,220

Cumulative share of losses (36,207) – – – (36,207) –

* During the previous financial year, joint venture shareholders of Attarat Power Holding Company B.V. made share premium contribution on its shares in Attarat Power Holding Company B.V. for consideration of RM362.9 million; settlement by way of offsetting the loans owing to the respective joint venture shareholders.

The individually immaterial joint ventures’ carrying amount is RM69.0 million (2019: RM67.0 million), Group’s share of profits is RM42.3 million (2019: RM7.7 million) and the Group’s share of total comprehensive loss is RM36.1 million (2019: total comprehensive loss of RM81.4 million).

211 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

18. INVESTMENTS

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Non-current assets Financial assets at fair value through profit or loss 18(a) 362,195 346,510 35,226 34,968 Financial assets at fair value through other comprehensive income 18(b) 42,716 63,461 9,599 9,477

404,911 409,971 44,825 44,445

Current assets Financial assets at fair value through profit or loss 18(a) 2,301,989 2,352,947 755,199 797,277

(a) Financial assets at fair value through profit or loss

The investments are in relation to the following:

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Income funds* – Within Malaysia 476,102 631,707 – – – Outside Malaysia 912,940 859,158 – – Equity funds – Within Malaysia 5,909 5,976 5,909 5,976 – Outside Malaysia 341,799 326,391 18,437 18,489 Quoted equity investments – Within Malaysia 3,071 4,155 3,071 4,155 – Outside Malaysia 7,809 6,348 7,809 6,348 Unquoted equity investments – Outside Malaysia 3,607 3,640 – – Unquoted preference shares – Within Malaysia – – – – Unquoted unit trusts* – Within Malaysia 912,947 862,082 755,199 797,277

2,664,184 2,699,457 790,425 832,245

Net fair value gain on investments 25,976 62,507 823 1,288

* Financial assets at fair value through profit or loss consist of investment in income funds and unit trusts placed with licensed financial institutions. The income funds and unit trusts are highly liquid and readily convertible to cash.

212 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

18. INVESTMENTS (CONT’D.)

(b) Financial assets at fair value through other comprehensive income

The investments are in relation to the following:

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Quoted equity investments – Within Malaysia 8,097 10,833 4 4 – Outside Malaysia 14,141 31,239 1 1 Unquoted equity investments – Within Malaysia 20,066 21,343 9,594 9,472 – Outside Malaysia 412 46 – –

42,716 63,461 9,599 9,477

Net fair value (loss)/gain on investments (12,325) (11,713) 123 277

213 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

19. INTANGIBLE ASSETS

The details of intangible assets are as follows:

Contract Goodwill on Software rights consolidation assets Others Total Note RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020 At cost At beginning of the financial year 143,995 7,960,260 – 89,869 8,194,124 Additions 13,266 – 162,102 – 175,368 Acquisition of subsidiaries – 243,332 – – 243,332 Currency translation differences 3,829 36,031 (2,659) 127 37,328 Transfer from property, plant and equipment * – – 386,204 – 386,204

At end of the financial year 161,090 8,239,623 545,647 89,996 9,036,356

Accumulated amortisation and impairment At beginning of the financial year (24,720) (120,167) – (26,037) (170,924) Amortisation for the year 7 (8,883) – (55,230) (5,493) (69,606) Currency translation differences (545) (150) 816 – 121 Impairment loss 7 – (1,723) – – (1,723) Transfer from property, plant and equipment* – – (163,130) – (163,130)

At end of the financial year (34,148) (122,040) (217,544) (31,530) (405,262)

Net carrying amount At 30 June 2020 126,942 8,117,583 328,103 58,466 8,631,094

* During the financial year, the Group decided to refine its analysis of assets and identify elements of its asset stock that could be classified as intangible assets. Following this exercise, those assets which meet the definition were transferred from property, plant and equipment to intangible assets.

214 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

19. INTANGIBLE ASSETS (CONT’D.)

The details of intangible assets are as follows: (cont’d.)

Contract Goodwill on rights consolidation Others Total Note RM’000 RM’000 RM’000 RM’000

Group – 2019 At cost At beginning of the financial year 137,385 5,922,469 62,314 6,122,168 Additions 4,215 – – 4,215 Acquisition of subsidiaries – 1,776,586 27,783 1,804,369 Currency translation differences 2,395 261,205 (228) 263,372

At end of the financial year 143,995 7,960,260 89,869 8,194,124

Accumulated amortisation and impairment At beginning of the financial year (17,281) (117,021) (11,991) (146,293) Amortisation for the year 7 (7,283) – (3,523) (10,806) Acquisition of subsidiaries – – (10,523) (10,523) Currency translation differences (156) (3,146) – (3,302)

At end of the financial year (24,720) (120,167) (26,037) (170,924)

Net carrying amount At 30 June 2019 119,275 7,840,093 63,832 8,023,200

Goodwill only arises in business combinations. The amount of goodwill initially recognised is dependent on the allocation of the purchase price to the fair value of the identifiable assets acquired and the liabilities assumed. The determination of the fair value of the assets and liabilities is based, to a considerable extent, on management judgement.

For the purposes of impairment testing, goodwill is allocated to the Group’s cash-generating units (“CGUs”) identified according to the following business segments:

Group

2020 2019 RM’000 RM’000

Utilities 5,484,637 5,454,797 Cement manufacturing & trading 2,143,823 1,895,968 Management services 299,556 298,444 Property investment & development 96,231 96,231 Hotel & restaurant operations 69,579 69,174 Others 23,757 25,479

8,117,583 7,840,093

215 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

19. INTANGIBLE ASSETS (CONT’D.)

Goodwill is tested for impairment on an annual basis by comparing the carrying amount with the recoverable amount of the CGUs. The recoverable amount of these CGUs was determined based on value-in-use calculations. Cash flow projections used in these calculations were based on financial budgets approved by management covering a five-year period. Cash flows beyond the five year period were extrapolated using the estimated growth rate. The growth rate did not exceed the long-term average growth rate for the segment business in which the CGUs operates.

(a) Key assumption used in the value-in-use calculation

The following assumption has been applied in the value-in-use calculation for the two of the major goodwill in utilities segment amounting to RM4.6 billion (2019: RM4.5 billion) (“A”) and RM820 million (2019: RM820 million) (“B”), respectively, and one of the major goodwill in cement manufacturing & trading (“C”) segment amounting to RM1.6 billion (2019: 1.6 billion).

2020 2019

A B C A B C % % % % % %

Pre-tax discounts 6.3 2.1 9.1 6.3 4.4 11.3 Terminal growth rate 20.0 (0.8) 2.2 2.0 0.1 2.1 Revenue growth 4.0 1.0 – 4.0 2.7 –

The discount rates used are pre-tax and reflect specific risks relating to the CGU. The discount rates applied to the cash flow projections are derived from the cost of capital plus a reasonable risk premium at the date of the assessment of the respective CGU.

For CGU “A”, cash flow projections used in the value-in-use calculation were based on approved financial budgets and forecasts covering a five-year period. Cash flows beyond the five-year period were extrapolated using the estimated growth rates stated above. The growth rate did not exceed the long-term average growth rate in which the CGU operates.

The terminal growth rate indicates the expected growth of cash flows after the forecast period of five years.

The revenue growth rate is calculated using the Compound Annual Growth Rate method and applied on the current year’s sales figures over the forecast period.

For CGU “B”, cash flow projections used in the value-in-use calculation were based on approved financial budgets and forecasts covering a one year period, to conform the final determinations approved by OFWAT, the economic regulator of the water sector in England and Wales.

For CGU “C”, cash flow projections used in the value-in-use calculation were based on approved financial budgets and forecasts covering a five year period.

The terminal growth rate indicates the expected growth of cash flows after the forecast period of five years.

216 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

19. INTANGIBLE ASSETS (CONT’D.)

(b) Sensitivity to change in key assumptions

Changing the assumptions selected by management used in the cash flow projections could significantly affect the Group’s results. The Group’s review includes performing sensitivity analysis of key assumptions.

The circumstances where a change in key assumptions will result in the recoverable amounts of goodwill on the CGUs to equal the corresponding carrying amounts assuming no change in the other variables are as follows:

2020 2019

A B C A B C % % % % % %

Pre-tax discounts 7.4 42.6 19.3 7.7 21.0 12.1 Terminal growth rate 0.7 (1.8) (19.8) 0.3 1.2 1.0 Revenue growth 2.0 (6.7) – 2.0 2.0 –

20. TRADE AND OTHER RECEIVABLES

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Non–current Trade receivables 413 43,669 – –

Other receivables 2,133 11,556 – – Less: Allowance for impairment (2,133) (2,544) – – Other receivables (net) – 9,012 – –

Deposits 16,670 591 – – Prepayments 66,345 13,888 – – Net investment in lease 32(a) 11,693 – – – Receivables from associate company^ 220,318 220,208 – – Receivables from a joint venture Ω 1,104,266 871,752 – –

1,419,705 1,159,120 – –

217 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

20. TRADE AND OTHER RECEIVABLES (CONT’D.)

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Current Trade receivables 2,081,689 2,732,974 – – Shareholder amounts held by solicitors 23,742 67,103 – –

2,105,431 2,800,077 – – Less: Allowance for impairment (557,230) (491,117) – –

Total trade receivables (net) 1,548,201 2,308,960 – –

Other receivables** 481,705 699,654 6,705 14,420 Less: Allowance for impairment (154,615) (158,036) (1,765) (1,765) Total other receivables (net) 327,090 541,618 4,940 12,655

Unbilled receivables 766,106 962,863 – – Less: Allowance for impairment (7,568) – – – Total unbilled receivables (net) 758,538 962,863 – –

Prepayments 360,608 304,699 98 363 Net investment in lease 32(a) 4,193 – – – Deposits 206,351 80,593 1,072 327

3,204,981 4,198,733 6,110 13,345

^ Receivables from associate comprise three loan notes to an associate. The notes have been issued by an associate in accordance to a loan note facility agreement. These receivables will mature in October 2030. Contingent interests are receivable on loan notes to the extent that there is sufficient available cash. In the event that cash is insufficient, interest will be accrued. The interest rate of the loan notes averages at 13.25% per annum.

Ω Receivables from a joint venture comprise shareholder loans to Attarat Power Holding Company B.V. that wholly owns Attarat Power Company (“APCO”). APCO is developing a 554 megawatt oil shale fired power generation project in the Hashemite Kingdom of Jordan. APCO has signed a 30-year power purchase agreement (including construction period of 3.5 years) with the National Electric Power Company (“NEPCO”), Jordan’s state-owned utility, for the entire electrical capacity and energy of the power plant, with an option for NEPCO to extend the power purchase agreement to 40 years (from the commercial operation date of the project’s second unit). The shareholder loans and accrued interest are repayable on demand. The interest rate of the shareholder loans is at 15.00% per annum. The shareholder loans included a conversion option to equity and were measured at FVTPL in 2019. The conversion option was waived during the financial year which represented a significant modification of the contract term. Therefore, the shareholder loans at FVTPL has been derecognised and it is now recognised at fair value and subsequently measured at amortised costs.

** In 2015, a foreign subsidiary of the Group has recognised other receivables, arising from liquidated damages for early termination of three electricity retail contracts based on the enforceable rights stipulated in the respective contracts. The trial was heard at the end of 2017 followed by a further hearing in November 2018. An allowance for impairment of receivables of RM70.7 million (SGD23.4 million) was recognised during previous financial year ended 30 June 2019 based on the decision of the High Court on 2 January 2019.

The fair value of receivables approximate their carrying amounts.

Expected Credit Loss (“ECL”) movement analysis is disclosed under Note 38(e) to the financial statements. 218 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

21. DERIVATIVE FINANCIAL INSTRUMENTS

The Group’s derivative financial instruments are analysed as follows:

Contract/ Fair values notional amount Assets Liabilities RM’000 RM’000 RM’000

Group – 2020 Cash-flow hedges – fuel oil swaps 1,343,133 51,469 171,622 – currency forwards 1,427,691 24,663 5,148

Fair value through profit or loss – fuel oil swaps 92,613 8,712 13,388 – currency forwards 4,740 – 187

84,844 190,345

Current portion 74,259 174,944 Non–current portion 10,585 15,401

84,844 190,345

Group – 2019 Cash-flow hedges – fuel oil swaps 1,657,600 74,701 47,972 – currency forwards 1,869,378 7,433 10,320 – interest rate swaps 2,931,554 – 49,533 – cross currency swaps 112,538 665 –

Fair value through profit or loss – fuel oil swaps 273,138 657 4,942 – currency forwards 213,439 288 1,507 – currency options contract* 1,656,800 – 3,333

83,744 117,607

Current portion 65,022 63,491 Non-current portion 18,722 54,116

83,744 117,607

* The Group entered into currency options contracts to enjoy interest rate reduction in related borrowings with an acceptable risk profile. The fair value is determined using the spot rate, interest rate, basis curve and volatility of the related currencies and time to maturity of the contracts.

219 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

21. DERIVATIVE FINANCIAL INSTRUMENTS (CONT’D.)

Hedging instruments used in the Group’s hedging strategy:

Changes in fair value used for Carrying calculating hedge amount ineffectiveness

Hedge Contractual Financial ineffectiveness Weighted notional Assets/ statement Hedging Hedged recognised in average Maturity amount (Liabilities) line item instrument item profit or loss hedged rate date RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020 Cash flow hedge Fuel oil price risk – Fuel oil swap to hedge 1,163,143 (130,493) Derivative (371,407) 371,407 – RM1,199.5 July 2020 – highly probable financial per metric ton January 2023 transactions (“HSFO”) instruments – Fuel oil swap to hedge 179,990 10,340 Derivative 11,993 (11,993) – RM151.0 July 2020 – highly probable financial per bbl June 2022 transactions (“LNG”) instruments

Foreign exchange risk – Forward contracts to 1,427,691 19,515 Derivative 47,199 (47,199) – RM4.2: July 2020 – hedge highly probable financial USD1.00 March 2023 transactions instruments

Group – 2019 Cash flow hedge Fuel oil price risk – Fuel oil swap to hedge 1,573,146 27,329 Derivative (55,116) 55,116 – RM1,425.0 July 2019 – highly probable financial per metric ton November 2021 transactions (“HSFO”) instruments – Fuel oil swap to hedge 84,454 (600) Derivative (1,073) 1,073 – RM281.9 July 2019 – highly probable financial per bbl December 2019 transactions (“LNG”) instruments

Foreign exchange risk – Forward contracts to 1,830,909 (3,819) Derivative (5,499) 5,499 – RM4.1: July 2019 – hedge highly probable financial USD1.00 January 2022 transactions instruments

220 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

21. DERIVATIVE FINANCIAL INSTRUMENTS (CONT’D.)

Period when the cash flows on cash flow hedges are expected to occur or affect the Income Statements:

(a) Fuel oil swaps

Fuel oil swaps are entered into to hedge highly probable forecast fuel purchases that are expected to occur at various dates within 31 months (2019: 29 months) from financial year end. The fuel oil swaps have maturity dates that match the expected occurrence of these transactions. Gains and losses recognised in the hedging reserve prior to the occurrence of these transactions are transferred to the inventory of fuels upon acquisition or cost of sales upon consumption of natural gas. The gains and losses relating to fuel oil inventory are subsequently recognised in the Income Statements upon consumption of the underlying fuels.

The fair value of fuel oil swaps is determined using a benchmark fuel price index at the reporting date.

(b) Currency forwards

Currency forwards are entered into to hedge highly probable forecast transactions denominated in foreign currency expected to occur at various dates within 33 months (2019: 31 months) from financial year end. The currency forwards have maturity dates that match the expected occurrence of these transactions.

Gains and losses relating to highly probable forecast fuel payments are recognised in the hedging reserve prior to the occurrence of these transactions and are transferred to the inventory of fuels upon acquisition or cost of sales upon consumption of natural gas. The gains and losses relating to fuel oil inventory are subsequently transferred to Income Statements upon consumption of the underlying fuels.

For those currency forwards used to hedge highly probable forecast foreign currency payments of purchase of property, plant and equipment, the gains and losses are included in the cost of the assets and recognised in the income statements over their estimated useful lives as part of depreciation expense.

For those currency forwards used to hedge highly probable forecast foreign currency transactions for maintenance contracts, the gains and losses are included in payments and recognised in Income Statements over the period of the contracts.

The fair values of forward currency contracts is determined using quoted forward currency rates at the reporting date.

(c) Interest rate swaps

The Group entered into interest rate swap contracts to manage its interest rate risk arising primarily from interest-bearing borrowings. Borrowings at floating rate expose the Group to fair value interest rates and the derivative financial instruments minimise the fluctuation of cash flow due to changes in the market interest rates. The derivative financial instruments are executed with credit-worthy financial institutions which are governed by appropriate policies and procedures with a view to limit the credit risk exposure of the Group.

The derivative financial instruments are stated at fair value based on banks’ quotes. The fair value changes on the effective portion of the derivatives that are designated and qualify as cash flow hedges are recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in income statement.

221 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

21. DERIVATIVE FINANCIAL INSTRUMENTS (CONT’D.)

(d) Cross-currency swap

The Group had entered into a cross currency swap contract to exchange interest payments and principal denominated in two different currencies to hedge against the exposure of its borrowings to interest rate risk and foreign exchange risk.

The changes in the fair value of these cross currency swap contracts that are designated as hedges are included as hedging reserve in equity and continuously released to the Income statements until the repayment of the bank borrowings or maturity of cross currency swap contracts whichever is earlier. For the cross currency swap contracts that are not designated as hedges, the changes in the fair value are recognised as other income or other expense in the Income statements.

22. INVENTORIES

Group

2020 2019 RM’000 RM’000

Consumable stores 72,086 24,297 Finished goods 174,013 258,487 Fuel 59,734 207,225 Property held for sales 1,288,681 1,679,118 Raw materials 228,483 234,562 Spare parts 341,342 355,823 Work-in-progress 20,024 24,211

2,184,363 2,783,723

During the financial year, included in the inventories of the Group with carrying value of RM1,143,395,000 (2019: RM1,595,960,000) pledged as security for a borrowing granted to the Group.

222 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

23. PROPERTY DEVELOPMENT COSTS

Freehold Leasehold Development land land costs Total Note RM’000 RM’000 RM’000 RM’000

Group – 2020 Cumulative property development costs:

At beginning of the financial year 99,299 88,998 391,063 579,360 Cost incurred during the financial year – – 27,155 27,155 Transfer from investment properties 13 51,787 – – 51,787 Transfer to property, plant and equipment 11 (69,122) – (312,243) (381,365) Transfer to inventories – (5,290) (101,469) (106,759) Transfer from land held for property development 14(a) (7,322) – – (7,322) Reversal of completed projects – (2,852) (20,425) (23,277) Currency translation differences (245) – 2,991 2,746

At end of the financial year 74,397 80,856 (12,928) 142,325

Cumulative cost recognised in profit or loss:

At beginning of the financial year (17,423) Recognised during the financial year 5 (7,322) Reversal of completed projects 23,277

At end of the financial year (1,468)

Property development costs at end of the financial year 140,857

223 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

23. PROPERTY DEVELOPMENT COSTS (CONT’D.)

Freehold Leasehold Development land land costs Total Note RM’000 RM’000 RM’000 RM’000

Group – 2019 Cumulative property development costs:

At beginning of the financial year 76,461 84,050 206,521 367,032 Cost incurred during the financial year – 1,875 97,421 99,296 Transfer from investment properties 13 23,225 – – 23,225 Transfer from land held for property development 14(a) – 3,073 915 3,988 Transfer from project development expenditure 14(b) – – 83,131 83,131 Currency translation differences (387) – 3,075 2,688

At end of the financial year 99,299 88,998 391,063 579,360

Cumulative cost recognised in profit or loss: At beginning of the financial year – Recognised during the financial year 5 (17,423)

At end of the financial year (17,423)

Property development costs at end of the financial year 561,937

Included in property development costs of the Group is interest capitalised during the financial year amounting to RM4,906,000 (2019: RM12,463,000).

224 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

24. CONTRACT ASSETS AND CONTRACT LIABILITIES

Group

2020 2019 RM’000 RM’000

Non-current Contract assets 540 2,486 Contract cost assets 1,165 3,130 Contract liabilities (31,326) (26,264)

Current Contract assets 201,468 205,932 Contract cost assets 26,151 33,592 Contract liabilities (633,343) (996,420)

Group

2020 2019 RM’000 RM’000

Representing: Contract assets 202,008 208,418 Contract liabilities (664,669) (1,022,684)

(462,661) (814,266)

Contract cost assets 27,316 36,722

Group

2020 2019 RM’000 RM’000

Representing: Utilities (187,272) (155,487) Property development (133,202) (208,850) Construction (109,000) (411,767) Hotel (29,934) (36,765) Cement (3,241) (1,397) Others (12) –

(462,661) (814,266)

225 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

24. CONTRACT ASSETS AND CONTRACT LIABILITIES (CONT’D.)

(a) Utilities

Significant changes in contract assets and liabilities:

Group

2020 2019 RM’000 RM’000

Contract assets At beginning of the financial year 158,566 78,171 Transfer to trade receivables (6,749) (76,495) Addition due to revenue recognised during the year 2,771 157,263 Currency translation differences – 15 Write back of/(Allowance for) impairment of contract assets 278 (388)

At end of the financial year 154,866 158,566

Group

2020 2019 RM’000 RM’000

Contract liabilities At beginning of the financial year 314,053 322,096 Revenue recognised that was included in the contract liability balance at the beginning of the financial year (313,562) (319,806) Increases due to cash received, excluding amounts recognised as revenue during the financial year 340,800 314,635 Currency translation differences 847 (2,872)

At end of the financial year 342,138 314,053

226 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

24. CONTRACT ASSETS AND CONTRACT LIABILITIES (CONT’D.)

(a) Utilities (CONT’D.)

(i) Assets recognised from costs to obtain or fulfil a contract

The Group capitalises costs to obtain or fulfil a contract which include sales commissions when they are incremental and expected to be recovered over more than a year. The Group also capitalises expenditure on assets such as water mains/ sewers or new connections relating to contracts as they are incurred to fulfil the contract. This is presented within contract cost assets within “contract assets” in the statements of financial position.

Group

2020 2019 RM’000 RM’000

At beginning of the financial year 36,721 39,353 Assets recognised from costs to obtain or fulfil a contract during the financial year 27,975 35,889 Amortisation recognised during the financial year (7,842) (11,569) Charged to cost of sales during the financial year (29,669) (26,688) Currency translation differences 131 (263)

At end of the financial year 27,316 36,722

The closing balance of contract cost assets consist of:

Group

2020 2019 RM’000 RM’000

Contract acquisition cost 111 597 Contract fulfillment cost 27,205 36,125

At end of the financial year 27,316 36,722

(ii) Unsatisfied performance obligations

As at 30 June 2020, the aggregate amount of the transaction price allocated to unsatisfied performance obligations resulting from contracts with customers is RM357.2 million (2019: RM382.6 million). This will be recognised as revenue as the services are provided to customer, which is expected to occur over the next 1 to 15 years (2019: 1 to 15 years).

The Group applied the practical expedient in MFRS 15 and did not disclose information about unsatisfied performance obligation for certain contracts, where the transaction price corresponds directly with the Group’s level of performance in the future.

227 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

24. CONTRACT ASSETS AND CONTRACT LIABILITIES (CONT’D.)

(b) Property development

Movement of contract assets and contract liabilities in relation to property development is analysed as follows:

Group

2020 2019 RM’000 RM’000

At beginning of the financial year (208,850) (70,175) Revenue recognised during the financial year 420,087 481,203 Progress billings during the financial year (345,111) (619,988) Consideration payable to customer 672 110

At end of the financial year (133,202) (208,850)

Representing: Contract assets 28,638 39,456 Contract liabilities (161,840) (248,306)

(133,202) (208,850)

Revenue from property development activities is recognised over time using the input method, which is based on the actual cost incurred to date on the property development project as compared to the total budgeted cost for the respective development projects.

(i) Unsatisfied performance obligations

The aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied or partially satisfied as at the reporting date was approximately RM95,758,000 (2019: RM51,579,000), of which the Group expects to be recognise as revenue within one year from the financial year end.

(c) Construction

Movement of contract assets and contract liabilities in relation to construction is analysed as follows:

Group

2020 2019 RM’000 RM’000

At beginning of the financial year (411,767) (40,816) Revenue recognised during the financial year 2,316,005 1,219,499 Cost incurred for project yet to recognised revenue 6,432 (43) Progress billings during the financial year (2,019,670) (1,590,407)

At end of the financial year (109,000) (411,767)

228 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

24. CONTRACT ASSETS AND CONTRACT LIABILITIES (CONT’D.)

(c) Construction (cont’d.)

Construction contracts represent the timing differences in revenue recognition and the milestone billings. The milestone billings are structured and/or negotiated with customers to reflect physical completion of the contracts.

Contract assets are transferred to receivables when the rights to economic benefits become unconditional. This usually occurs when the Group issues billing to the customer. Contract liabilities are recognised as revenue when performance obligations are satisfied.

There were no significant changes in the contract assets and liabilities during the financial year.

Included in aggregate costs incurred to date of the Group is the depreciation capitalised during the financial year amounting to RM9,290,000 (2019: RM7,590,000).

(i) Unsatisfied performance obligations

The aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied or partially satisfied as at the reporting date was approximately RM4.57 billion (2019: RM6.75 billion), of which the Group expects to be recognised as revenue in the financial statements in the next three years.

(d) Hotel operations

The Group recognises contract liabilities when a customer pays consideration, or is contractually required to pay consideration, before the Group recognises the related revenue. The contract liabilities are expected to be recognised as revenue within a year.

Group

2020 2019 RM’000 RM’000

Contract Liabilities 29,934 36,765

Group

2020 2019 RM’000 RM’000

Significant changes to contract liabilities balances during the period are as follows:

Contract liabilities as at the beginning of the period recognised as revenue during the year 36,532 20,714

Advances received during the year 151,770 169,248

Customer deposits represent advance payment by customers for future bookings of hotel rooms, food and beverage and transport.

229 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

24. CONTRACT ASSETS AND CONTRACT LIABILITIES (CONT’D.)

(e) Cement manufacturing & trading

Group

2020 2019 RM’000 RM’000

Amount received in advance of delivery of goods 3,241 1,397

Revenue is recognised when the control of the goods is transferred to the customer, being at the point the goods are delivered to the customer. When the customer initially purchases the goods, the transaction price received at that point by the Group is recognised as contract liability until the goods have been delivered to the customer.

25. AMOUNTS DUE FROM/TO RELATED PARTIES

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

(a) Amounts due from related parties

Amounts due from: – Holding company 17 38 – – – Subsidiaries – – 1,299,910 1,011,391 – Related companies 23,389 13,831 3,498 2,987 – Associated companies 27,549 17,238 60 57 – Joint ventures 2,739 24 – –

53,694 31,131 1,303,468 1,014,435

(b) Amounts due to related parties

Amounts due to: – Holding company 329 – – – – Subsidiaries – – 4,655 5,496 – Related parties 5,946 8,661 53 50 – Associated companies 10,139 531 – – – Joint ventures 22,798 6,814 – –

39,212 16,006 4,708 5,546

(c) The amounts due from/to related parties pertain mainly to trade receivables/payables, advances and payments on behalf. The outstanding amounts are unsecured, interest free and payable on demand except for advances given to subsidiaries amounting RM21.4 million (2019: RM18.0 million) which bear interest rate of 4.1% per annum (2019: 5.4% per annum).

(d) The significant related parties’ transactions of the Group and of the Company are disclosed in Note 40 to the financial statements.

230 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

26. CASH AND CASH EQUIVALENTS

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Deposit with a licensed bank 10,396,221 10,635,496 102,070 198,360 Cash and bank balances 1,265,011 1,171,006 1,929 122,948

11,661,232 11,806,502 103,999 321,308 Bank overdrafts 31 (45,147) (42,675) – – Deposits with maturity 90 days and more (516,019) – – –

Cash and cash equivalents as per statements of cash flows 11,100,066 11,763,827 103,999 321,308

Cash and bank balances of the Group included amounts totalling RM4,682,000 (2019: RM8,882,000) held pursuant to Section 7A of the Housing Developers (Control and Licensing) Act 1966. Those amounts were restricted from use in other operations.

The range of interest rates of deposits that were effective at the reporting date were as follows:

Group Company

2020 2019 2020 2019 % % % %

Deposits with licensed banks 0.03-4.25 0.25-3.95 0.03-3.35 1.60-3.50

Deposits of the Group and of the Company have maturities ranging from 1 day to 365 days (2019: 1 day to 365 days). Bank balances are deposits held at call with banks.

Included in the deposits with licensed banks amounting to RM57,846,000 (2019: RM4,167,000) is pledged as a security for a borrowing as disclosed in Note 31.

The Group and of the Company seek to invest cash and cash equivalents safely and profitably with creditworthy local and offshore licensed banks. The credit quality of the local and offshore licensed banks are P1 as rated by RAM Rating Services Bhd. and Moody’s Investors Service, Inc., respectively.

231 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

27. SHARE CAPITAL

Group/Company

Number of shares Amount

2020 2019 2020 2019 ‘000 ‘000 RM’000 RM’000

Issued and fully paid: At beginning of the financial year 10,910,560 10,910,560 3,340,111 3,340,111 Share Exchange Offer 112,202 – 127,444 –

At end of the financial year 11,022,762 10,910,560 3,467,555 3,340,111

Out of a total of 11,022,762,340 (2019: 10,910,559,429) ordinary shares issued and fully paid-up ordinary shares, the Company holds 372,906,618 (2019: 341,862,418) ordinary shares as treasury shares. As at 30 June 2020, the number of ordinary shares in issue and fully paid net of treasury shares are 10,649,855,722 (2019: 10,568,697,011).

The holders of ordinary shares (except treasury shares) are entitled to receive dividends as and when declared by the Company. All ordinary shares carry one vote per share and rank equally with regard to the Company’s residual assets.

(a) Treasury shares

The shareholders of the Company granted a mandate to the Company to repurchase its own shares at the Annual General Meeting held on 12 December 2019. The Directors of the Company are committed to enhance the value of the Company to its shareholders and believe that the repurchase plan can be applied in the best interest of the Company and its shareholders.

During the financial year, the Company repurchased 31,044,200 (2019: 109,030,600) ordinary shares of its issued share capital from the open market. The average price paid for the shares repurchased was RM0.94 (2019: RM1.24) per share. The repurchase transactions were financed by internally generated funds. The shares repurchased are being held as treasury shares in accordance with Section 127(6) of the Companies Act 2016.

As at 30 June 2020, the Company held as treasury shares a total of 372,906,618 (2019: 341,862,418) of its 11,022,762,340 (2019: 10,910,559,429) issued ordinary shares. Such treasury shares are held at a carrying amount of RM501,836,889 (2019: RM472,793,189).

(b) Employees’ Share Option Scheme (“ESOS”)

On 1 April 2011, the Company implemented a new share issuance scheme known as the Employees Share Option Scheme which was approved by the shareholders of the Company at an Extraordinary General Meeting held on 30 November 2010, the ESOS is for eligible employees and directors of the Company and/or its subsidiaries who meet the criteria of eligibility for participation as set out in the by-laws of the ESOS (“By-Laws”).

232 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

27. SHARE CAPITAL (CONT’D.)

(b) Employees’ Share Option Scheme (“ESOS”) (cont’d.)

The salient terms of the ESOS are as follows:

(i) The ESOS shall be in force for a period of ten (10) years, effective from 1 April 2011.

(ii) The maximum number of shares to be allotted and issued pursuant to the exercise of the options which may be granted under the ESOS shall not exceed fifteen per cent (15%) of the total issued and paid-up share capital of the Company at the point of time throughout the duration of the ESOS.

(iii) Any employee (including the directors) of the Group shall be eligible to participate in the ESOS if, as at the date of offer of an option (“Offer Date”), the person:

a) has attained the age of eighteen (18) years;

b) is a director or an employee employed by and on payroll of a company within the Group; and

c) in the case of employees, has been in the employment of the Group for a period of at least one (1) year of continuous service prior to and up to the Offer Date, including service during the probation period, and is confirmed in service. The options committee may, at its discretion, nominate any employee (including directors) of the Group to be an eligible employee despite the eligibility criteria under Clause 3.1(iii) of the By-Laws not being met, at any time and from time to time.

(iv) The subscription price for shares under the ESOS shall be determined by the Board upon recommendation of the options committee and shall be fixed based on the weighted average market price of shares, as quoted on Bursa Securities, for the five (5) market days immediately preceding the Offer Date of the options with a discount of not more than ten per cent (10%), if deemed appropriate, or such lower or higher limit in accordance with any prevailing guidelines issued by Bursa Securities or any other relevant authorities as amended from time to time.

(v) Subject to Clause 13 of the By-Laws, the options committee may, at any time and from time to time, before or after an option is granted, limit the exercise of the option to a maximum number of new ordinary shares of the Company and/or such percentage of the total ordinary shares of the Company comprised in the options during such period(s) within the option period and impose any other terms and/or conditions deemed appropriate by the options committee in its sole discretion including amending/varying any terms and conditions imposed earlier. Notwithstanding the above, and subject to Clauses 10 and 11 of the By-Laws, the options can only be exercised by the grantee no earlier than three (3) years after the Offer Date or such other period as may be determined by the options committee at its absolute discretion, by notice in writing to the options committee, provided however that the options committee may at its discretion or upon the request in writing by the grantee allow the options to be exercised at any earlier or other period.

(vi) A grantee shall be prohibited from disposing of the new ordinary shares of the Company allotted and issued to him for a period of one (1) year from the date on which the option is exercised or such other period as may be determined by the options committee at its absolute discretion.

233 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

27. SHARE CAPITAL (CONT’D.)

(b) Employees’ Share Option Scheme (“ESOS”) (cont’d.)

The movements during the financial year in the number of share options of the Company are as follows:

Financial year ended 30 June 2020

<------Number of share options over ordinary shares ------> At beginning Expiry Exercise of the At end of the Grant date date price financial year Granted Lapsed financial year RM/share ‘000 ‘000 ‘000 ‘000

Scheme 16.07.2012 31.03.2021 1.71 120,900 – (1,405) 119,495 14.03.2018 31.03.2021 1.26 252,294 – (4,321) 247,973

373,194 – (5,726) 367,468

Financial year ended 30 June 2019

<------Number of share options over ordinary shares ------> At beginning Expiry Exercise of the At end of the Grant date date price financial year Granted Lapsed financial year RM/share ‘000 ‘000 ‘000 ‘000

Scheme 16.07.2012 31.03.2021 1.71 125,895 – (4,995) 120,900 14.03.2018 31.03.2021 1.26 259,483 – (7,189) 252,294

385,378 – (12,184) 373,194

234 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

27. SHARE CAPITAL (CONT’D.)

(b) Employees’ Share Option Scheme (“ESOS”) (cont’d.)

The options granted to employees on 16 July 2012 vested on 16 July 2015, while the options granted to employees on 14 March 2018 will vest on 14 March 2021.

The fair value of options granted for which MFRS 2 applies, was determined using the Trinomial Valuation model. The significant inputs in the model are as follows:

Share options Share options granted on granted on 16.07.2012 14.03.2018

Valuation assumptions: Expected volatility 23.6% 22.1% Expected dividend yield 4.5% 3.6% Expected option life 3 – 4 years 3 – 4 years Risk-free interest rate per annum (based on Malaysia securities bonds) 3.1% 3.4%

The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may not necessarily be the actual outcome.

Value of employee services received for issue of share options:

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Share option expenses by the Company 16,509 16,679 16,509 16,679 by the subsidiary 5,133 5,353 – – Allocation to subsidiaries – – (9,850) (10,000) Allocation to related companies (5) (12) (5) (12)

Total share option expenses 21,637 22,020 6,654 6,667

235 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

28. NON-DISTRIBUTABLE RESERVES

(a) Other reserves

Foreign Equity currency Share Total Capital component translation options Statutory Hedging other reserve of ICULS reserve reserve reserve1 FVOCI reserve reserves RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020 At beginning of the financial year 97,317 73,848 749,375 92,881 19,042 (29,798) (95,599) 907,066

Changes in fair value – – – – – (12,325) (79,685) (92,010) Exchange differences – – (274,166) – – – – (274,166)

Total comprehensive loss for the year – – (274,166) – – (12,325) (79,685) (366,176)

Conversion of ICULS – (46,825) – – – – – (46,825) Share option expenses – – – 19,343 – – – 19,343 Share option lapsed – – – (527) – – – (527) Subsidiary’s share option lapsed – – – (346) – – – (346) Currency translation differences (147) – 5,286 – 650 – (5,789) –

At end of the financial year 97,170 27,023 480,495 111,351 19,692 (42,123) (181,073) 512,535

Group – 2019 At beginning of the financial year 97,427 73,848 628,989 75,627 18,554 (18,085) 95,517 971,877

Changes in fair value – – – – – (11,713) (198,713) (210,426) Exchange differences – – 128,361 – – – – 128,361

Total comprehensive income/(loss) for the year – – 128,361 – – (11,713) (198,713) (82,065)

Share option expenses – – – 19,635 – – – 19,635 Share option lapsed – – – (1,748) – – – (1,748) Subsidiary’s share option lapsed – – – (633) – – – (633) Currency translation differences (110) – (7,975) – 488 – 7,597 –

At end of the financial year 97,317 73,848 749,375 92,881 19,042 (29,798) (95,599) 907,066

Note: 1 This represents a reserve which needs to be set aside pursuant to local statutory requirement of an associated company.

236 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

28. NON-DISTRIBUTABLE RESERVES (CONT’D.)

(a) Other reserves (cont’d.)

Share Total options Fair value other reserve reserve reserves RM’000 RM’000 RM’000

Company – 2020 At beginning of the financial year 64,040 2,636 66,676 Changes in fair value – 123 123 Share option expenses 16,509 – 16,509 Share option lapsed (527) – (527)

At end of the financial year 80,022 2,759 82,781

Company – 2019 At beginning of the financial year 49,109 2,359 51,468 Changes in fair value – 277 277 Share option expenses 16,679 – 16,679 Share option lapsed (1,748) – (1,748)

At end of the financial year 64,040 2,636 66,676

29. LONG-TERM PAYABLES

Group

2020 2019 RM’000 RM’000

Deferred income 1,087,304 958,774 Deposits 48,662 123,517 Payable to non-controlling interests 120,241 116,365 Other payables 1,093 32,763

1,257,300 1,231,419

Deposits comprise amount collected from retail customers in relation to the provision of electricity and deposits received from developers of housing development in relation to the provision of water and sewerage infrastructure and security deposits from property tenants. The deferred income is in relation to assets transferred from customers and services of the water and sewerage segment which are yet to be provided and shareholder loan interest revenue. The fair value of payables approximates their carrying values.

237 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

30. BONDS

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Current: Medium Term Notes 30(a) 220,000 510,024 – – Commercial papers – 10,000 – 10,000

220,000 520,024 – 10,000

Non–current: Medium Term Notes 30(a) 9,652,636 10,373,669 2,500,000 2,500,000 3.52% Retail Price Index Guaranteed Bonds 30(b) 435,657 422,492 – – 5.75% Guaranteed Unsecured Bonds 30(c) 1,824,667 1,818,003 – – 5.375% Guaranteed Unsecured Bonds 30(d) 1,046,940 1,043,000 – – 1.75% Index Linked Guaranteed Bonds 30(e) 1,171,955 1,136,539 – – 1.369% and 1.374% Index Linked Guaranteed Bonds 30(f) 1,171,955 1,136,539 – – 1.489%, 1.495% and 1.499% Index Linked Guaranteed Bonds 30(g) 1,104,074 1,074,176 – – 2.186% Index Linked Guaranteed Bonds Due 2039 30(h) 360,010 349,611 – – 4.0% Guaranteed Unsecured Bonds 30(i) 1,583,640 1,582,157 – – 1.5% Guaranteed Unsecured Bonds 30(j) 1,304,105 – – – Japan bonds 30(k) – 25,480 – –

19,655,639 18,961,666 2,500,000 2,500,000

Total 19,875,639 19,481,690 2,500,000 2,510,000

The bonds are repayable:

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Not later than 1 year 220,000 520,024 – 10,000 Later than 1 year but not later than 5 years 7,079,115 6,090,388 1,000,000 – Later than 5 years 12,576,524 12,871,278 1,500,000 2,500,000

Total 19,875,639 19,481,690 2,500,000 2,510,000

238 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

30. BONDS (CONT’D.)

The weighted average effective interest rates of the bonds of the Group and of the Company as at the reporting date are as follows:

Group Company

2020 2019 2020 2019 % % % %

Medium Term Notes 3.98 2.21 4.63 4.47 Bonds 4.00 4.82 – 3.60

The fair values of the bonds of the Group and the Company as at the reporting date are as follows:

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

3.52% Retail Price Index Guaranteed Bonds 292,651 301,271 – – 5.75% Guaranteed Unsecured Bonds 2,763,282 2,661,429 – – 5.375% Guaranteed Unsecured Bonds 1,364,607 1,335,425 – – 1.75% Index Linked Guaranteed Bonds 1,735,032 1,728,881 – – 1.369% and 1.374% Index Linked Guaranteed Bonds 1,743,250 1,737,755 – – 1.489%, 1.495% and 1.499% Index Linked Guaranteed Bonds 1,737,765 1,730,838 – – 2.186% Index Linked Guaranteed Bonds Due 2039 424,060 424,696 – – 4.0% Guaranteed Unsecured Bonds 1,635,886 1,671,827 – – 1.5% Guaranteed Unsecured Bonds 1,327,959 – – – Medium Term Notes 10,460,962 8,704,698 2,366,078 2,366,078 Japan bonds – 25,480 – –

23,485,454 20,322,300 2,366,078 2,366,078

(a) Medium term notes (“MTNs”)

(i) The MTNs of the Company were issued pursuant to:

a) Commercial papers (“CP’s) and Medium term notes (“MTNs”) Programme with a combined master limit of RM5.0 billion and a sub-limit on the CPs programme of RM500.0 million (collectively the “Bond Programmes”) pursuant to a programme agreement dated 17 June 2019;

A nominal value of RM500 million of MTNs was issued on 25 June 2019 to refinance the Company’s existing RM500 million nominal value MTNs. The coupon rate of the MTNs is 4.60% (2019: 4.60%) per annum, payable semi-annually in arrears and the MTNs are redeemable on 23 June 2034 at nominal value.

During previous financial year, the Company issued new CPs with a nominal value of RM10 million. The coupon rate of the CPs is 3.60% per annum and was fully repaid during the financial year.

239 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

30. BONDS (CONT’D.)

(a) Medium term notes (“MTNs”) (cont’d.)

(i) The MTNs of the Company were issued pursuant to: (cont’d.)

b) A MTNs issuance programme of up to RM2.0 billion constituted by a Trust Deed and Programme Agreement, both dated 26 March 2013.

A nominal value of RM1,000,000,000 of MTNs was issued under the programme on 25 April 2013 at a coupon rate 4.38% (2019: 4.38%) per annum, payable semi-annually in arrears. The MTNs are redeemable on 25 April 2023 at nominal value.

A nominal value of RM500,000,000 of MTNs was issued under the programme on 11 November 2016 at a coupon rate 5.15% (2019: 5.15%) per annum, payable semi-annually in arrears. The MTNs are redeemable on 11 November 2036 at nominal value.

A nominal value of RM500,000,000 of MTNs was issued under the programme on 11 November 2016 at a coupon rate 4.63% (2019: 4.63%) per annum, payable semi-annually in arrears. The MTNs are redeemable on 11 November 2026 at nominal value.

(ii) The MTNs of YTL Power International Berhad (“YTLPI”) were issued pursuant to:

a) A Medium Term Notes programme of up to RM5,000,000,000 constituted by a Trust Deed and MTNs Agreement, both dated 11 August 2011. The facility bears interest rates ranging from 4.49% to 4.99% (2019: 4.35% to 4.99%) per annum.

b) The Islamic MTNs of YTLPI were issued pursuant to Islamic Medium Term Notes facility of up to RM2,500,000,000 in nominal value under the Shariah principle of Murabahah (via Tawarruq Arrangement) which constituted by a Trust Deed and Facility Agency Agreement, both dated 20 April 2017. The facility bears a profit rate of 5.05% (2019: 5.05%) per annum.

(iii) The MTNs of Starhill Global REIT (“SGREIT”) were issued pursuant to:

a) Singapore MTNs (Series 002 Notes)

The Group issued SGD100 million unsecured seven-year Singapore MTNs comprised in Series 002 (the “Series 002 Notes”) in February 2014 (maturing in February 2021) under its SGD2 billion Multicurrency MTNs Programme. The Series 002 Notes bear a fixed rate interest of 3.50% per annum payable semi-annually in arrears and have a rating of “BBB+” by Standard & Poor’s Rating Services.

b) Singapore MTNs (Series 003 Notes)

The Group issued SGD125 million unsecured eight-year Singapore MTNs comprised in Series 003 (the “Series 003 Notes”) in May 2015 (maturing in May 2023) under its SGD2 billion Multicurrency MTNs Programme. The Series 003 Notes bear a fixed rate interest of 3.40% per annum payable semi-annually in arrears and have a rating of “BBB+” by Standard & Poor’s Rating Services.

240 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

30. BONDS (CONT’D.)

(a) Medium term notes (“MTNs”) (cont’d.)

(iii) The MTNs of Starhill Global REIT (“SGREIT”) were issued pursuant to: (cont’d.)

c) Singapore MTNs (Series 004 Notes)

The Group issued SGD70 million unsecured ten-year Singapore MTNs comprised in Series 004 (the “Series 004 Notes”) in October 2016 (maturing in October 2026) under its SGD2 billion Multicurrency MTNs Programme. The Series 004 Notes bear a fixed rate interest of 3.14% per annum payable semi-annually in arrears and have a rating of “BBB+” by Standard & Poor’s Rating Services.

d) Malaysia MTNs

SGREIT has outstanding five-year fixed-rate senior medium term notes of a nominal value of RM330 million (“Senior MTN”) issued at a discounted cash consideration of approximately RM325 million. The Senior MTN bear a fixed coupon rate of 4.48% per annum and have a carrying amount of approximately RM329.8 million (SGD107.8 million) as at 30 June 2019. The notes have an expected maturity in September 2019 and legal maturity in March 2021, and are secured, inter alia, by a fixed and floating charge over all the assets of Ara Bintang Berhad.

During the financial year, SGREIT and its subsidiary companies’ ceased to be subsidiaries of the Group.

(iv) The MTNs of YTL REIT were issued pursuant to:

The MTNs of the Group were issued pursuant to a MTNs issuance programme of up to RM1,650 million constituted by a Trust Deed and Programme Agreement, both dated 11 May 2016. As at end of the reporting period, RM810 million (2019: RM810 million) were issued as follow:-

a) A nominal value of RM65 million of MTNs was issued on 23 May 2017 to finance the renovation costs carried out at The Ritz-Carlton, Kuala Lumpur – Suite Wing and Hotel Wing. The MTNs are redeemable on 23 May 2022 at nominal value.

b) A nominal value of RM385 million of MTNs was issued on 3 November 2017 to finance the acquisition of The Majestic Hotel Kuala Lumpur by YTL REIT. The MTNs are redeemable on 1 November 2024 at nominal value.

c) A nominal value of RM265 million of MTNs was issued on 23 November 2017 to refinance the existing borrowings of YTL REIT. The MTNs are redeemable on 23 November 2022 at nominal value.

d) A nominal value of RM10 million of MTNs was issued on 24 May 2019 to refinance YTL REIT existing RM10 million nominal value MTNs. The MTNs are redeemable on 23 May 2022 at nominal value.

e) A nominal value of RM85 million of MTNs was issued on 28 June 2019 to finance the renovation costs carried out at JW Marriott Hotel Kuala Lumpur. The MTNs are redeemable on 28 June 2023 at nominal value.

The MTNs bear coupon rates ranging from 4.21% to 5.05% (2019: 4.70% to 5.10%) per annum, payable semi-annually in arrears and is secured by certain properties.

241 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

30. BONDS (CONT’D.)

(a) Medium term notes (“MTNs”) (cont’d.)

(v) The MTNs of YTL Cement Berhad (“YTL Cement”) were issued pursuant to:

In 2016, Kedah Cement Sdn. Bhd. (formerly known as Lafarge Cement Sdn. Bhd.) (“KCSB”), a subsidiary of the Group, had established a Sukuk Wakalah Programme (“Sukuk Wakalah”) for the issuance of up to RM500,000,000 in nominal value of Sukuk Wakalah. It provides KCSB the flexibility to raise funds from time to time which can be utilised to finance and/ or to reimburse the acquisition of property, plant and equipment/investments, to fund working capital requirements and to refinance existing bank borrowings of KCSB. The Sukuk Wakalah Programme has a tenure of 7 years from the date of first issuance of the Sukuk Wakalah.

On 13 January 2017, KCSB made its first and second issuance of RM100,000,000 and RM180,000,000 in nominal value of Sukuk Wakalah, respectively based on the Shariah principle of Wakalah and Murabahah under the Sukuk Wakalah Programme to fund working capital requirements of KCSB. The Sukuk Wakalah bore profit based at 4.40% and 4.80% per annum and has been fully settled in 2018 and 2020 respectively.

On 13 December 2017 and 10 July 2019, KCSB made its third and fourth issuance of RM100,000,000 in nominal value of Sukuk Wakalah, based on the Shariah principle of Wakalah and Murabahah under the Sukuk Wakalah Programme to fund working capital requirements of KCSB. The Sukuk Wakalah are due on 11 December 2020 and 8 July 2022 and bear profit at 5.00% and 5.06% per annum, payable semi-annually.

On 10 July 2019, KCSB made its fifth issuance of RM120,000,000 in nominal value of Sukuk Wakalah, based on the Shariah principle of Wakalah and Murabahah under the Sukuk Wakalah Programme to fund working capital requirements of KCSB. The Sukuk Wakalah are due on 9 July 2020 and bear profit at 4.10% per annum.

On 13 January 2020 and 9 July 2020, KCSB made its sixth and seventh issuance of RM180,000,000 in nominal value of Sukuk Wakalah, based on the Shariah principle of Wakalah and Murabahah under the Sukuk Wakalah Programme to fund working capital requirements of KCSB. The Sukuk Wakalah are due on 13 January 2023 and 7 July 2023 and bear profit at 4.60% and 4.55% per annum, payable semi-annually.

(b) 3.52% Retails price index guaranteed bonds (“RPIG Bonds”)

The RPIG Bonds of Wessex Water Services Finance Plc. bear interest semi-annually on 30 January and 30 July at an interest rate of 3.52% initially, indexed up by the inflation rate every year. The effective interest rate as at 30 June 2020 is 5.77% (2019: 6.71%) per annum. The RPIG Bonds will be redeemed in full by Issuer on 30 July 2023 at their indexed value together with all accrued interest.

242 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

30. BONDS (CONT’D.)

(c) 5.75% Guaranteed unsecured bonds

On 15 October 2003, Wessex Water Services Finance Plc. (“Issuer”), a subsidiary of the Group, issued GBP350,000,000 nominal value 5.75% Guaranteed Unsecured Bonds due 2033 (“5.75% GU Bonds”) unconditionally and irrevocably guaranteed by Wessex Water Services Limited, a subsidiary of the Group. The 5.75% GU Bonds are constituted under a Trust Deed dated 15 October 2003. The nominal value of 5.75% GU Bonds issued amounted to GBP350,000,000 and as at 30 June 2020 GBP346,532,441 (2019: GBP346,358,915) remained outstanding, net of amortised fees and discount. The net proceeds of the 5.75% GU Bonds were used for refinancing of existing financial indebtedness and for general corporate purposes.

The Bonds bear interest at 5.75% per annum, payable annually on 14 October of each year. The bonds will be redeemed in full by the Issuer on 14 October 2033 at their nominal value together with all accrued interest.

(d) 5.375% Guaranteed unsecured bonds

On 10 March 2005, Wessex Water Services Finance Plc. (“Issuer”), a subsidiary of the Group, issued GBP200,000,000 nominal value 5.375% Guaranteed Unsecured Bonds due 2028 (“5.375% GU Bonds”) unconditionally and irrevocably guaranteed by Wessex Water Services Limited (“Guarantor”), a subsidiary of the Group. The 5.375% GU Bonds are constituted under a Trust Deed dated 10 March 2005.

The nominal value of 5.375% GU Bonds issued amounted to GBP200,000,000, of which GBP198,830,197 (2019: GBP198,708,230) remained outstanding as at 30 June 2020, net of amortised fees and discount. The net proceeds of the bonds were used for refinancing of existing financial indebtedness and for general corporate purposes.

The Bonds bear interest at 5.375% per annum, payable annually on 10 March of each year. The bonds will be redeemed in full by the Issuer on 10 March 2028 at their nominal value together with all accrued interest.

(e) 1.75% Index linked guaranteed bonds

On 31 July 2006, Wessex Water Services Finance Plc. (“Issuer”) issued two (2) tranches of GBP75,000,000 nominal value 1.75% Index Linked Guaranteed Bonds (“ILG Bonds 1”) unconditionally and irrevocably guaranteed by Wessex Water Services Limited (“Guarantor”). The ILG Bonds 1 was each constituted under a Trust Deed dated 31 July 2006 and is unsecured.

The ILG Bonds 1 bear interest semi-annually on 31 January and 31 July at an interest rate of 1.75% initially, indexed up by the inflation rate every year. The effective interest rate as at 30 June 2020 is 4.00% (2019: 4.94%) per annum. The bonds will be redeemed in full by the Issuer on 31 July 2046 for one tranche, and 31 July 2051 for the other tranche at their indexed value together with all accrued interest.

(f) 1.369% AND 1.374% Index linked guaranteed bonds

On 31 January 2007, Wessex Water Services Finance Plc. (“Issuer”) issued GBP75,000,000 nominal value 1.369% Index Linked Guaranteed Bonds and GBP75,000,000 nominal value 1.374% Index Linked Guaranteed Bonds, both due 2057 (“ILG Bonds 2”) unconditionally and irrevocably guaranteed by Wessex Water Services Limited (“Guarantor”). The ILG Bonds 2 were each constituted under a Trust Deed dated 31 January 2007 and are unsecured.

The ILG Bonds 2 bear interest semi-annually on 31 January and 31 July at an interest rate of 1.369% and 1.374% initially, indexed up by the inflation rate every year. The effective interest rate as at 30 June 2020 is 3.62% (2019: 4.56%) per annum. The bonds will be redeemed in full by the Issuer on 31 July 2057 at their indexed value together with all accrued interest.

243 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

30. BONDS (CONT’D.)

(g) 1.489%, 1.495% AND 1.499% Index linked guaranteed bonds

On 28 September 2007, Wessex Water Services Finance Plc. (“Issuer”) issued GBP50,000,000 nominal value 1.489% Index Linked Guaranteed Bonds, GBP50,000,000 nominal value 1.495% Index Linked Guaranteed Bonds and GBP50,000,000 nominal value 1.499% Index Linked Guaranteed Bonds, all due 2058 (“ILG Bonds 3”) unconditionally and irrevocably guaranteed by Wessex Water Services Limited (“Guarantor”). The ILG Bonds 3 were each constituted under a Trust Deed dated 28 September 2007 and are unsecured.

The ILG Bonds 3 bear interest semi-annually on 29 November and 29 May at an interest rate of 1.489%, 1.495% and 1.499% initially, indexed up by the inflation rate every year. The effective interest rate as at 30 June 2020 is 4.12% (2019: 3.93%) per annum. The ILG Bonds will be redeemed in full by the Issuer on 29 November 2058 at their indexed value together with all accrued interest.

(h) 2.186% Index linked guaranteed bonds

On 7 September 2009, Wessex Water Services Finance Plc. (“Issuer”) issued GBP50,000,000 nominal value 2.186% Index Linked Guaranteed Bonds due 2039 (“ILG Bonds 4”) unconditionally and irrevocably guaranteed by Wessex Water Services Limited (“Guarantor”). The ILG Bonds 4 were constituted under a Trust Deed dated 7 September 2009 and are unsecured.

The ILG Bonds 4 bear interest semi-annually on 1 December and 1 June at an interest rate of 2.186% initially, indexed up by the inflation rate every half year. The effective interest rate as at 30 June 2020 is 2.74% (2019: 2.54%) per annum. The ILG Bonds 4 will be redeemed in full by the Issuer on 1 June 2039 at their indexed value together with all accrued interest.

(i) 4.0% Guaranteed unsecured bonds

On 24 January 2012, Wessex Water Services Finance Plc. (“Issuer”), a subsidiary of the Group, issued GBP200,000,000 nominal value 4.00% Guaranteed Unsecured Bonds due 2021 (“4% GU Bonds”) unconditionally and irrevocably guaranteed by Wessex Water Services Limited (“Guarantor”), a subsidiary of the Group. The 4% GU Bonds are constituted under a Trust Deed dated 24 January 2012. The nominal value of 4% GU Bonds issued amounted to GBP200,000,000, of which GBP199,667,155 (2019: GBP199,400,879) remained outstanding as at 30 June 2020, net of amortised fees and discount. The net proceeds of the 4% GU Bonds were used for refinancing of existing financial indebtedness and for general corporate purposes.

On 30 August 2012, Wessex Water Services Finance Plc. (“Issuer”), a subsidiary of the Group, issued GBP100,000,000 nominal value 4.00% Guaranteed Unsecured Bonds due 2021 (“4% GU Bonds”) unconditionally and irrevocably guaranteed by Wessex Water Services Limited (“Guarantor”), a subsidiary of the Group. The 4% GU Bonds are constituted under a Trust Deed dated 30 August 2012. The nominal value of 4% GU Bonds issued amounted to GBP100,000,000 of which GBP101,090,703 (2019: GBP102,025,593) remained outstanding as at 30 June 2020, net of amortised fees and discount. The net proceeds of the 4% GU Bonds were used for refinancing of existing financial indebtedness and for general corporate purposes.

The Bonds bear interest at 4.00% per annum, payable annually on 24 September of each year. The bonds will be redeemed in full by the Issuer on 24 September 2021 at their nominal value together with all accrued interest.

The 4% GU Bonds GBP100,000,000 due 24 September 2021 were consolidated to form a single series with the 4% GU Bonds GBP200,000,000 which was issued on 24 January 2012.

244 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

30. BONDS (CONT’D.)

(j) 1.5% Guaranteed Unsecured Bonds

On 17 September 2019, Wessex Water Services Finance Plc. (“Issuer”), a subsidiary of the Group, issued GBP250,000,000 nominal value 1.50% Guaranteed Unsecured Bonds due 2029 (retaining GBP 50,000,000) (“1.5% GU Bonds”) unconditionally and irrevocably guaranteed by Wessex Water Services Limited (“Guarantor”), a subsidiary of the Group. The 1.5% GU Bonds are constituted under a Trust Deed dated 17 September 2019. The nominal value of 1.5% GU Bonds issued amounted to GBP200,000,000, of which GBP198,438,600 remained outstanding as at 30 June 2020, net of amortised fees and discount. The net proceeds of the 1.5% GU Bonds were used for refinancing of existing financial indebtedness and for general corporate purposes.

On 15 June 2020, Wessex Water Services Finance Plc. (“Issuer”), a subsidiary of the Group, sold the retained GBP50,000,000 nominal value 1.5% Guaranteed Unsecured Bonds due 2029. The nominal value of 1.5% GU Bonds issued amounted to GBP50,000,000, of which GBP49,231,124 remained outstanding as at 30 June 2020, net of amortised fees and discount. The net proceeds of the 1.5% GU Bonds were used for refinancing of existing financial indebtedness and for general corporate purposes.

The Bonds bear interest at 1.50% per annum, payable annually on 17 September of each year. The Bonds will be redeemed in full by the Issuer on 17 September 2029 at their nominal value together with all accrued interest.

(k) Japan bonds

Starhill Global REIT One TMK (“SGREIT One TMK”), a subsidiary of the Group, has JPY678 million (SGD8.5 million) of Japan bonds outstanding as at 30 June 2019, maturing in August 2021. The interest rate for the Japan bond was hedged via interest rate cap. Whilst no security has been pledged, the bondholders of the Japan bond have a statutory preferred right, under the Japan Asset Liquidation Law, to receive payment of all obligations under the Japan bond prior to other creditors out of the assets of the issuer (SGREIT One TMK). During the financial year, SGREIT and its subsidiary companies’ ceased to be subsidiaries of the Group.

245 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

31. BORROWINGS

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Current Bankers’ acceptances 31(a) 28,726 24,347 – – Bank overdrafts 31(b) 45,147 42,675 – – Finance lease liabilities 31(c) – 30,265 – 565 Irredeemable convertible unsecured loan stocks 31(d) 2,103 15,609 – – Revolving credit 31(e) 3,688,009 3,354,043 1,750,654 1,266,855 Term loans 31(f) 7,333,571 11,370,304 – 200,000

11,097,556 14,837,243 1,750,654 1,467,420

Non-current Finance lease liabilities 31(c) – 17,489 – 550 Irredeemable convertible unsecured loan stocks 31(d) 3,539 – – – Revolving credit 31(e) 1,747,204 565,935 – – Term loans 31(f) 10,841,940 11,177,431 – –

12,592,683 11,760,855 – 550

Total Bankers’ acceptances 31(a) 28,726 24,347 – – Bank overdrafts 31(b) 45,147 42,675 – – Finance lease liabilities 31(c) – 47,754 – 1,115 Irredeemable convertible unsecured loan stocks 31(d) 5,642 15,609 – – Revolving credit 31(e) 5,435,213 3,919,978 1,750,654 1,266,855 Term loans 31(f) 18,175,511 22,547,735 – 200,000

23,690,239 26,598,098 1,750,654 1,467,970

246 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

31. BORROWINGS (CONT’D.)

The borrowings of the Group and the Company are repayable as follows:

Later than 1 year but Not later not later Later than than 1 year than 5 years 5 years Total RM’000 RM’000 RM’000 RM’000

Group At 30 June 2020 Bankers’ acceptances 28,726 – – 28,726 Bank overdrafts 45,147 – – 45,147 ICULS 2,103 3,539 – 5,642 Revolving credit 3,688,009 1,747,204 – 5,435,213 Term loans 7,333,571 10,173,500 668,440 18,175,511

11,097,556 11,924,243 668,440 23,690,239

At 30 June 2019 Bankers’ acceptances 24,347 – – 24,347 Bank overdrafts 42,675 – – 42,675 Finance lease liabilities 30,265 17,489 – 47,754 ICULS 15,609 – – 15,609 Revolving credit 3,354,043 425,935 140,000 3,919,978 Term loans 11,370,304 9,555,068 1,622,363 22,547,735

14,837,243 9,998,492 1,762,363 26,598,098

Company At 30 June 2020 Revolving credit 1,750,654 – – 1,750,654

1,750,654 – – 1,750,654

At 30 June 2019 Finance lease liabilities 565 550 – 1,115 Revolving credit 1,266,855 – – 1,266,855 Term loans 200,000 – – 200,000

1,467,420 550 – 1,467,970

The carrying amounts of the borrowings of the Group and of the Company as at the reporting date approximated their fair values.

247 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

31. BORROWINGS (CONT’D.)

The weighted average effective interest rates of the borrowings of the Group and the Company as at the reporting date are as follows:

Group Company

2020 2019 2020 2019 % % % %

Term loans 3.21 3.11 – 4.34 Revolving credit 4.16 4.10 2.85 3.90 ICULS 7.49 7.49 – – Bankers’ acceptances 4.01 3.05 – – Bank overdrafts 1.10 2.89 – – Finance lease liabilities – 1.60 – 2.40

(a) Bankers’ acceptances

All the bankers’ acceptances are unsecured and repayable on demand.

(b) Bank overdrafts

All the bank overdraft facilities are unsecured and repayable on demand.

(c) Finance lease liabilities

Finance lease liabilities were included in borrowings until 30 June 2019 and were reclassified to lease liabilities on 1 July 2019 upon the adoption of MFRS 16. For the impact of the changes in accounting policy for leases and adjustments recognised on adoption of MFRS 16 on 1 July 2019, please refer to Note 44 to the financial statements.

The Group’s finance lease bears interest rates ranging from 1.56% to 4.97% per annum and the Company’s finance lease bears interest rate at 2.27% per annum.

Group Company 2019 2019 RM’000 RM’000

Payable not later than 1 year 31,721 599 Payable later than 1 year and not later than 5 years 17,702 566 Later than 5 years 53 -

Total minimum lease payments 49,476 1,165 Less: Finance charges (1,722) (50)

Present value of minimum lease payments 47,754 1,115

248 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

31. BORROWINGS (CONT’D.)

(d) Irredeemable convertible unsecured loan stocks (“ICULS”)

ICULS 2011/2021

On 31 October 2011, YTL Land & Development Berhad (“YTL Land”), a subsidiary of the Group issued 992,378,023 ten (10) years 3% stepping up to 6% ICULS at a nominal value of RM0.50 each, maturing 31 October 2021 (“Maturity Date”).

The salient terms of the ICULS 2011/2021 are as follows:

(i) The ICULS 2011/2021 bear a coupon rate of 3.0% per annum from date of issue (“Issue Date”) up to fourth anniversary of the Issue Date and 4.5% per annum from the date after the fourth anniversary of the Issue Date up to the seventh anniversary of the Issue Date. Thereafter, the ICULS 2011/2021 bear a coupon rate of 6.0% per annum up to the maturity date. The interest is payable semi-annually in arrears.

(ii) The ICULS 2011/2021 are convertible at any time on or after its issuance date into new ordinary shares of YTL Land at the conversion price, which is fixed on a step-down basis, as follows:

• For conversion at any time from the date of issue up to the fourth anniversary, conversion price is RM1.32;

• For conversion at any time after fourth anniversary of issue up to the seventh anniversary, conversion price is RM0.99; and

• For conversion at any time after seventh anniversary of issue up to the maturity date, conversion price is RM0.66

(iii) The ICULS 2011/2021 are not redeemable and any ICULS 2011/2021 remaining immediately after the maturity date shall be mandatorily converted into ordinary shares at the conversion price.

(iv) The new ordinary shares issued from the conversion of ICULS 2011/2021 will be deemed fully paid-up and rank pari passu in all respects with all existing ordinary shares of YTL Land.

A certain amount of the ICULS 2011/2021 are held by the Company (refer Note 15 to the financial statements). The relevant amounts have been eliminated in the Statements of Financial Position.

(e) Revolving credit

Save for RM288,209,000 (2019: RM180,000,000) revolving credit facility of YTL Land & Development Berhad, all the revolving credit facilities are unsecured and repayable on demand.

(f) Term loans

(i) Term loans denominated in Great British Pounds

a) The term loans of RM394,912,500 [GBP75,000,000] (2019: RM393,667,500 [GBP75,000,000]) are unsecured loans of Wessex Water Services Limited and are guaranteed by Wessex Water Limited. The loans bear interest rates ranging from 1.21% to 1.27% (2019: 1.05% to 1.50%) per annum and are repayable in full on 22 July 2021.

249 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

31. BORROWINGS (CONT’D.)

(f) Term loans (cont’d.)

(i) Term loans denominated in Great British Pounds (cont’d.)

b) The term loans of RM1,053,100,000 [GBP200,000,000] (2019: RM1,049,780,000 [GBP200,000,000]) are unsecured loans of Wessex Water Services Limited and are guaranteed by Wessex Water Limited. The first loan of GBP50,000,000 was drawn down on 30 January 2015 bears an interest rate of 2.16% (2019: 2.16%) per annum, the second loan of GBP50,000,000 was drawn down on 9 March 2015 bears interest rates ranging from 1.27% to 1.41% (2019: 1.15% to 1.42%) per annum, the third loan of GBP50,000,000 was drawn down on 9 April 2015 bears an interest rate of 1.99% (2019: 1.99%) per annum, and the fourth loan of GBP50,000,000 was drawn down on 25 May 2016 bears interest rates ranging from 1.65% to 1.76% (2019: 1.49% to 1.77%) per annum. All the loans are repayable in full between 30 January 2024 and 25 May 2025.

c) The term loans of RM1,053,100,000 [GBP200,000,000] (2019: RM734,846,000 [GBP140,000,000]) was drawn by Wessex Water Services Limited of which RM1,044,436,968 [GBP198,354,756] (2019: RM728,262,084 [GBP138,745,658]) remained outstanding as at 30 June 2020, net of amortised fees. The loans bear interest rates ranging from 1.81% to 2.03% (2019: 1.83% to 2.03%) per annum and are repayable with a 60% bullet repayment on 31 January 2026 with the remaining 40% being repaid in equal semi-annual instalments commencing 31 January 2021.

All the term loans are unsecured.

(ii) Term loans denominated in US Dollars

a) The term loan of RM828,400,000 [USD200,000,000] of previous year was drawn down by YTL Power International Berhad (“YTLPI”) on 28 May 2015 and was fully repaid during the financial year. The borrowing bears interest rates ranging from 3.06% to 3.71% (2019: 3.63% to 4.04%) per annum.

b) The term loan of RM856,000,000 [USD200,000,000] (2019: RM828,400,000 [USD200,000,000]) was drawn down by YTLPI on 17 December 2015 and repayable on 17 December 2020. The borrowing bears interest rates ranging from 1.25% to 3.36% (2019: 3.36% to 3.74%) per annum.

c) The term loan of RM1,070,000,000 [USD250,000,000] (2019: RM1,035,500,000 [USD250,000,000]) was drawn down by YTLPI on 31 March 2017 of which RM1,063,537,133 [USD248,489,984] (2019: RM1,025,841,237 [USD247,668,092]) remained outstanding as at 30 June 2020, net of amortised fees. The borrowing bears interest rates ranging from 1.37% to 3.60% (2019: 3.27% to 3.72%) per annum and is repayable on 31 March 2022.

d) The term loan of RM942,305,000 [USD227,500,000] of previous year was drawn down by YTL Corp. Finance (Cayman) Limited on 16 March 2016 and are guaranteed by the Company. The loan bears interest rate of 3.26% (2019: 3.74%) per annum and was fully repaid during the financial year.

All the term loans are unsecured.

(iii) Term loans denominated in Ringgit Malaysia

Save for the term loan of RM1,964,450,000 (2019: RM1,996,313,000) of the Group, all the term loans are unsecured.

250 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

31. BORROWINGS (CONT’D.)

(f) Term loans (cont’d.)

(iv) Term loans denominated in Singapore Dollars

Included in the term loan are:

a) The term loan of RM6,064,279,851 [SGD1,974,177,958] (2019: RM6,038,721,474 [SGD1,973,180,458]) was drawn down by YTL PowerSeraya Pte. Limited (“YTLPS”) on 14 September 2017 and repayable in full on 12 September 2022. The borrowing is an unsecured loan and bears interest rates ranging from 1.55% to 3.16% (2019: 2.83% to 3.44%) per annum.

The bank borrowings are subject to loan covenant clauses stipulated in the loan agreement. As at 30 June 2020, YTLPS did not meet the requirement of a certain loan covenants and as a result, the borrowings have been classified as a current liability in the statement of financial position of the Group. On 23 September 2020, YTLPS received a waiver from the consortium of banks on the requirement to comply with the above loan covenants as at 30 June test date. The waiver effectively extended the loan covenants compliance requirements to 30 November 2020. The extension provides YTLPS with the opportunity to meet two key requirements namely completion of the securitisation documentation and Tuaspring Pte. Ltd. (“Tuaspring”) acquisition.

Save for the term loan of RM1,102,464,000 (2019: RM759,284,000) of the Group, all the term loans are unsecured.

(v) Term loans denominated in Australian Dollars

All the term loan are secured by first fixed charge over the properties.

(vi) Term loans denominated in Japanese Yen

Save for the term loan of RM236,600,000 of the Group, all the term loan are secured by first fixed charge over the properties.

32. LEASE LIABILITIES

The details of lease liabilities are as follows:

Group Company 2020 2020 RM’000 RM’000

Presented as: Current 176,495 7,254 Non-current 1,447,352 2,479

1,623,847 9,733

251 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

32. LEASE LIABILITIES (CONT’D.)

The Group’s maturity profile of lease liabilities are disclosed in Note 39(a) to the financial statements.

Extension and termination options are included in a number of property and equipment leases across the Group and the Company. These are used to maximise operational flexibility in terms of managing the assets used in the Group and the Company’s operations. The majority of extension and termination options held are exercisable only by the Group and the Company and not by the respective lessor.

Some property leases contain variable payment terms that are liked to sales with percentages ranging from 1% to 5% of sales. Variable lease payments that depend on sales are recognised in profit or loss in the period which the condition that triggers those payments occurs.

(a) Net investment in leases

Group 2020 RM’000

At beginning of the financial year – Effect of adoption of MFRS 16 16,739 Additions 5,087 Interest income 1,128 Lease payments received (7,068)

At end of the financial year 15,886

Presented as: Current 4,193 Non-current 11,693

15,886

252 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

32. LEASE LIABILITIES (CONT’D.)

(a) Net investment in leases (cont’d.)

The Group leases concrete mixer trucks to third parties. Each of the leases contains an initial non-cancellable period of 7 years.

These leases transfer substantially all the risk and rewards incidental to ownership of the concrete mixer trucks. The Group expects the residual value of the concrete mixer trucks at the end of the lease term to be minimal. These leases do not include buy-back agreements or residual value guarantees.

The lease payments to be received are as follows:

Group 2020 RM’000

Less than 1 year 4,766 1 to 2 years 4,507 2 to 3 years 3,524 3 to 4 years 2,598 4 to 5 years 1,345 More than 5 years 537

Total undiscounted lease payments 17,277 Unearned interest income (1,391)

Net investment in leases 15,886

During the financial period, the Group has recognised a gain of RM77,000 for entering into new finance sub-lease.

33. GRANTS AND CONTRIBUTIONS

Group

2020 2019 Note RM’000 RM’000

At beginning of the financial year 560,828 548,493 Currency translation differences 1,665 (1,124) Amortisation of grants and contributions 7 (15,166) (15,973) Received during the financial year 49,342 29,432

At end of the financial year 596,669 560,828

Grants and contributions represents government grants in foreign subsidiaries in respect of specific qualifying expenditure on infrastructure assets, non-infrastructure assets and a cogeneration plant.

253 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

34. DEFERRED TAXATION

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

At beginning of the financial year, as reported previously 2,073,144 2,143,967 113 113

Effect of adoption of MFRS 16 (5) – – –

At beginning of the financial year, as restated 2,073,139 2,143,967 113 113 Charged to Income Statements 144,558 9,395 – – – Property, plant and equipment 184,067 22,386 – – – Property development 692 (750) – – – Investment properties 2,226 589 – – – Retirement benefits 16,550 4,360 – – – Provision 707 (1,131) – – – Unutilised capital allowance (20,625) (5,591) – – – Unabsorbed tax losses (21,677) (8,989) – – – Leases (3,575) – – – – Others (13,807) (1,479) – –

Currency translation differences 10,234 (3,778) – – Acquisition of subsidiary 4,933 (68,497) – – Credited to Other Comprehensive Income* (49,984) (7,943) – – Derecognition of subsidiary (18,876) – – –

At end of the financial year 2,164,004 2,073,144 113 113

* This is in relation to re-measurement of post-employment benefit obligations.

254 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

34. DEFERRED TAXATION (CONT’D.)

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off income tax assets against income tax liabilities and when the deferred taxes relate to the same tax authority. The following amounts determined after appropriate offsetting are shown in the Statements of Financial Position:-

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Deferred tax assets provided are in respect of:-

Deferred tax assets before offsetting Unutilised capital allowances (168,899) (115,428) – – Retirement benefits (174,567) (133,293) – – Unabsorbed tax losses (229,587) (231,316) – – Provision (5,915) (16,406) – – Leases (8,166) – – – Others (113,352) (20,637) – –

(700,486) (517,080) – – Offsetting 700,486 517,080 – –

Deferred tax assets after offsetting – – – –

Deferred tax liabilities provided are in respect of:-

Deferred tax liabilities before offsetting Property, plant and equipment – capital allowances in excess of depreciation 2,800,277 2,530,401 113 113 Land held for property development 38,825 37,892 – – Others 25,388 21,931 – –

2,864,490 2,590,224 113 113 Offsetting (700,486) (517,080) – –

Deferred tax liabilities after offsetting 2,164,004 2,073,144 113 113

255 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

34. DEFERRED TAXATION (CONT’D.)

Deferred tax assets have not been recognised in respect of the following items:-

Group

2020 2019 RM’000 RM’000

Unabsorbed tax losses 1,390,181 1,681,878 Unutilised capital allowances 1,300,968 2,251,985 Deductible temporary differences 170,634 77,406 Taxable temporary differences – property, plant and equipment (620,424) (1,188,767)

2,241,359 2,822,502

The unabsorbed tax losses and unutilised capital allowances are subject to agreement with the Inland Revenue Board. On the other hand, effective from year of assessment 2019 as announced in the Annual Budget 2019, the unused tax losses of the Group as at 31 December 2018 and thereafter will only be available for carry forward for a period of 7 consecutive years. Upon expiry of the 7 years, the unabsorbed losses will be disregarded.

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Defined contribution plans – Current – Malaysia 35(a) 5,281 4,874 287 305

Defined benefit plans – Non–current – Malaysia 35(b) 21,937 55,346 – – – United Kingdom 35(c) 869,245 687,950 – – – Indonesia 35(d) 19,716 16,350 – –

910,898 759,646 – –

(a) Defined contribution plans

Group companies incorporated in Malaysia contribute to the Employees Provident Fund, the national defined contribution plan. Once the contributions have been paid, the Group has no further payment obligations.

256 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(b) Defined benefit plans – Malaysia

The defined benefit plans typically exposes the Group to actuarial risks such as longevity risk and salary risk.

(i) Longevity risk

The present value of the defined benefit plans liability is calculated by reference to the best estimate of the mortality of plan participants during their employment. An increase in the life expectancy of the plan participants will increase the plan’s liability.

(ii) Salary risk

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan’s liability.

The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out on 29 August 2020 by an external actuary.

The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit method.

The principal actuarial assumptions at the end of the reporting period are as follows:-

Group

2020 2019 % %

Discount rate 3.9 5.1 Future salary increase rate 5.0 5.0

Sensitivity analysis:-

Significant actuarial assumption for the determination of the defined benefit obligation is the discount rate. The sensitivity analysis below has been determined based on reasonably possible change of the respective assumption occurring at the end of the reporting period, while holding all other assumptions constant.

If the discount rate increase/(decrease) by 0.5%, the defined benefit obligation would decrease by RM1,081,738/increase by RM1,016,616 (2019: decrease by RM2,373,490/increase by RM2,598,869).

257 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(b) Defined benefit plans – Malaysia (cont’d.)

Sensitivity analysis:- (cont’d.)

The movements in the net liability recognised in the Statements of Financial Position are as follows:-

Group

2020 2019 RM’000 RM’000

At beginning of the financial year 55,346 – Acquisition of subsidiaries – 54,816 (Reversal)/Charge for the financial year (19,487) 530 Benefits paid/payables (16,261) – Actuarial loss recognised in other comprehensive income 2,339 –

At end of the financial year 21,937 55,346

The amounts recognised in the Statements of Financial Position are analysed as follows:-

Group

2020 2019 RM’000 RM’000

Present value of unfunded obligation 21,937 55,346

Reconciliation of the present value of unfunded obligation are as follows:-

Group

2020 2019 RM’000 RM’000

At beginning of the financial year 55,346 – Acquisition of subsidiaries – 54,816 Actuarial loss 2,339 – Benefits paid/payables (16,261) – Current service cost (1,695) 304 Curtailment gain (17,879) – Interest cost 87 226

At end of the financial year 21,937 55,346

258 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(b) Defined benefit plans – Malaysia (cont’d.)

The amounts recognised in the Income Statements are as follows:-

Group

2020 2019 RM’000 RM’000

Current service cost (1,695) 304 Interest cost 87 226 Curtailment gain (17,879) –

Total charge to Income Statements (19,487) 530

(c) Defined benefit plans – United Kingdom

A subsidiary of the Group operates final salary defined benefit plans for its employees in the United Kingdom, the assets of which are held in separate trustee-administered funds. The latest actuarial valuation of the plan was undertaken by a qualified actuary as at 30 September 2019. This valuation has been adjusted to the reporting date as at 30 June 2020 taking account of experience over the period since 30 September 2019, changes in market conditions, and differences in the financial and demographic assumptions by the qualified actuary.

(i) Profile of the scheme

The defined benefit obligations include benefits for current employees, former employees and current pensioners. Broadly, about 27% of the liabilities are attributable to current employees, 16% to former employees and 57% to current pensioners. The scheme duration is an indicator of the weighted-average time until benefit payments are made. For the scheme as a whole, the duration is around 17-18 years reflecting the approximate split of the defined benefit obligation between current employees (duration of 24 years), deferred members (duration of 24 years) and current pensioners (duration of 13 years).

(ii) Funding requirements

UK legislation requires that pension schemes are funded prudently. The last funding valuation report, 30 September 2019 showed a deficit of GBP157.0 million (RM826.7 million). The subsidiary is paying deficit contributions of:- • GBP13.04 million (RM68.6 million) by 1 August 2020; • GBP14.80 million (RM77.9 million) by 1 July 2021; • GBP16.60 million (RM87.4 million) by 1 July 2022; • GBP18.40 million (RM96.9 million) by 1 July 2023; • GBP20.20 million (RM106.4 million) by 1 July 2024; • GBP22.00 million (RM115.8 million) by 1 July 2025; • GBP23.80 million (RM125.3 million) by 1 April 2026;

which, along with investment returns from return-seeking assets, is expected to make good this shortfall by 1 April 2026.

The next funding valuation is due no later than 30 September 2022 at which progress towards full-funding will be reviewed.

259 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(c) Defined benefit plans – United Kingdom (cont’d.)

(ii) Funding requirements (cont’d.)

The subsidiary also pays contributions of 21.7%, increasing to 24.6% from 1 April 2021, of pensionable salaries in respect of current accrual and non-investment related expenses, with active members paying a further 7.4% of pensionable salaries on average. A contribution of GBP13.04 million (RM68.6 million) is expected to be paid by the subsidiary during the year ending on 30 June 2021.

(iii) Risks associated with the scheme

Asset volatility – The liabilities are calculated using a discount rate set with reference to corporate bond yields; if assets underperform this yield, this will create a deficit. The scheme holds a significant proportion of growth assets (equities including a diversified growth fund and a global absolute return fund) which, though expected to outperform corporate bonds in the long-term, create volatility and risk in the short-term. The allocation to growth assets is monitored to ensure it remains appropriate given the scheme’s long-term objectives.

Changes in bond yields – A decrease in corporate bond yields will increase the value placed on the scheme’s liabilities for accounting purposes, although this will be partially offset by an increase in the value of the scheme’s bond holdings.

Inflation risk – The majority of the scheme’s benefit obligations are linked to inflation and higher inflation will lead to higher liabilities (although, in most cases, caps on the level of inflationary increases are in place to protect against extreme inflation). The majority of the assets are either unaffected by or only loosely correlated with inflation, meaning that an increase in inflation will also increase the deficit.

Life expectancy – The majority of the scheme’s obligations are to provide benefits for the life of the member, so increases in life expectancy will result in an increase in the liabilities.

The trustees insure certain benefits payable on death before retirement.

The movements during the financial year in the amounts recognised in the Statements of Financial Position are as follows:-

Group

2020 2019 RM’000 RM’000

At 1 July 687,950 671,629 Pension cost 76,778 80,526 Contributions and benefits paid (125,949) (110,159) Currency translation differences 1,063 (6,355) Re-measurement loss 229,403 52,309

At 30 June 869,245 687,950

260 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(c) Defined benefit plans – United Kingdom (cont’d.)

The amounts recognised in the Statements of Financial Position are as follows:-

Group

2020 2019 RM’000 RM’000

Present value of funded obligations 4,424,366 4,081,555 Fair value of plan assets (3,555,121) (3,393,605)

Liability in the Statements of Financial Position 869,245 687,950

Changes in present value of defined benefit obligations are as follows:-

Group

2020 2019 RM’000 RM’000

At 1 July 4,081,555 3,922,374 Exchange differences 9,610 (38,238) Interest cost 95,364 111,022 Current service cost 57,175 56,506 Contributions by scheme participants 530 1,068 Past service cost – 2,669 Net benefits paid (143,046) (147,852) Re–measurement (gain)/loss:- – Actuarial gain arising from demographic assumptions (73,643) (146,250) – Actuarial loss arising from financial assumptions 321,589 327,729 – Actuarial loss/(gain) arising from experience adjustments 75,232 (7,473)

Present value of defined benefit obligations, at 30 June 4,424,366 4,081,555

261 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(c) Defined benefit plans – United Kingdom (cont’d.)

Changes in fair value of plan assets are as follows:-

Group

2020 2019 RM’000 RM’000

At 1 July 3,393,605 3,250,745 Exchange differences 8,547 (31,883) Interest income 79,470 92,340 Contributions by employer 125,949 110,159 Contributions by scheme participants 530 1,068 Net benefits paid (143,046) (147,852) Administration expenses (3,709) (2,669) Re-measurement gain:- – Return on plan assets excluding interest income 93,775 121,697

Fair value of plan assets, at 30 June 3,555,121 3,393,605

The pension cost recognised is analysed as follows:-

Group

2020 2019 RM’000 RM’000

Current service cost 57,175 56,506 Interest cost 15,894 18,682 Past service cost – 2,669 Administration expenses 3,709 2,669

Total charge to Income Statements 76,778 80,526

The charge to Income Statements was included in the following line items:-

Group

2020 2019 RM’000 RM’000

Cost of sales 45,663 46,383 Administration expenses 15,221 15,461 Interest cost 15,894 18,682

Total charge to Income Statements 76,778 80,526

262 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(c) Defined benefit plans – United Kingdom (cont’d.)

The principal assumptions used in the actuarial calculations were as follows:-

Group

2020 2019 % %

Discount rate 1.60 2.30 Expected rate of increase in pension payment 1.90-2.60 1.90-3.00 Expected rate of salary increases 1.80 1.70 Price inflation – RPI 2.70 3.10 Price inflation – CPI 2.20 2.10

Mortality assumptions:-

The mortality assumptions are based upon the recent actual mortality experience of scheme members, and allow for expected future improvements in mortality rates.

2020 2020 2019 2019 Male Female Male Female Years Years Years Years

Life expectancy – current age 60 25.9 28.3 26.2 28.3 Life expectancy – current age 40 47.0 49.5 47.4 49.5

The mortality table adopted is based upon 105% of standard tables S3P(M/F)A adjusted to allow for individual years of birth. Future improvements are assumed to be in line with the CMI 2018 core projection, with a long-term improvement rate of 1.0% p.a. for all members.

263 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(c) Defined benefit plans – United Kingdom (cont’d.)

Sensitivity analysis:-

The key assumptions used for MFRS 119 are: discount rate, inflation and mortality. If different assumptions are used, this could have a material effect on the results disclosed. The sensitivity of the results to these assumptions are set out below. For the purposes of these sensitivities, it has been assumed that the change in the discount rate and inflation has no impact on the value of scheme assets.

Scheme liabilities Scheme deficit

Increase by Increase from Increase to Increase from Increase to Key assumptions RM’000 RM’000 RM’000 RM’000 RM’000

A reduction in the discount rate of 0.1% (from 1.6% to 1.5%) 80,036 4,424,366 4,504,402 869,244 949,280 An increase in the inflation of 0.1% (from 2.2% to 2.3% for CPI and 2.7% to 2.8% for RPI) 70,558 4,424,366 4,494,924 869,244 939,802 An increase in life expectancy of 1 year 182,713 4,424,366 4,607,079 869,244 1,051,957

The plan assets comprised the following:-

2020 2019

RM’000 % RM’000 %

Equity instrument 1,142,087 32.1 1,335,845 39.4 Debt instrument 1,948,235 54.8 1,802,472 53.1 Property 193,770 5.5 191,585 5.6 Others 271,030 7.6 63,711 1.9

3,555,122 100.0 3,393,613 100.0

Group

2020 2019 RM’000 RM’000

Actual return on plan assets 173,245 214,037

264 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(d) Defined benefit plans – Indonesia

Summary of obligations relating to employee benefits due under prevailing law and regulations as well as under the Indonesia subsidiary’s regulations are as presented below:-

Group

2020 2019 RM’000 RM’000

Obligation relating to post-employment benefits 17,261 14,021 Obligation relating to other long-term employee benefits 2,455 2,329

Total 19,716 16,350

A subsidiary of the Group has a defined contribution pension plan covering its qualified permanent national employees in Indonesia. The subsidiary’s contribution is 6% of employee basic salary, while the employees’ contribution ranges from 3% to 14%.

The contributions made to the defined contribution plan are acceptable for funding the post-employment benefits under the labour regulations.

The obligations for post-employment and other long-term employee benefits were recognised with reference to actuarial reports prepared by an independent actuary. The latest actuarial report was dated 30 June 2020.

(i) Post-employment benefit obligations

The movements during the financial year in the amounts recognised in the Statements of Financial Position are as follows:-

Group

2020 2019 RM’000 RM’000

At 1 July 14,021 11,916 Pension cost 1,924 1,689 Contributions and benefits paid (633) (537) Currency translation differences 534 220 Re-measurement loss 1,415 733

At 30 June 17,261 14,021

265 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(d) Defined benefit plans – Indonesia (cont’d.)

(i) Post-employment benefit obligations (cont’d.)

The obligations relating to post-employment benefits recognised in the Statements of Financial Position are as follows:-

Group

2020 2019 RM’000 RM’000

Present value of obligations 17,261 14,021

Changes in present value of defined benefit obligations are as follows:-

Group

2020 2019 RM’000 RM’000

At 1 July 14,021 11,916 Currency translation differences 534 220 Interest cost 1,013 911 Current service cost 911 778 Net benefits paid (633) (537) Re-measurement loss/(gain): – Actuarial loss from demographic assumptions 1,698 – – Actuarial loss arising from financial assumptions – 779 – Actuarial gain arising from experience adjustments (283) (46)

Present value of defined benefit obligations at 30 June 17,261 14,021

The pension cost recognised can be analysed as follows:-

Group

2020 2019 RM’000 RM’000

Current service cost 911 778 Interest cost 1,013 911

Total charge to Income Statements 1,924 1,689

266 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(d) Defined benefit plans – Indonesia (cont’d.)

(ii) Other long-term employee benefit obligations

The obligations relating to other long-term employee benefits (i.e. long leave service benefits) recognised in the Statements of Financial Position are as follows:-

Group

2020 2019 RM’000 RM’000

Present value of obligations 2,455 2,329

The movements during the financial year in the amount recognised in the Statements of Financial Position are as follows:-

Group

2020 2019 RM’000 RM’000

At 1 July 2,329 1,964 Pension cost 503 636 Actuarial gain (32) – Contributions and benefits paid (424) (311) Currency translation differences 79 40

At 30 June 2,455 2,329

Changes in present value of defined benefit obligations are as follows:-

Group

2020 2019 RM’000 RM’000

At 1 July 2,329 1,964 Currency translation differences 79 40 Current service cost 485 636 Actuarial gain (32) – Interest cost 18 – Net benefits paid (424) (311)

At 30 June 2,455 2,329

267 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

35. POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONT’D.)

(d) Defined benefit plans – Indonesia (cont’d.)

(ii) Other long-term employee benefit obligations

The amounts relating to other long-term employee benefits obligation recognised in the Income Statements are as follows:-

Group

2020 2019 RM’000 RM’000

Current service cost 485 636

The charge above was included in the cost of sales.

The principal assumptions used in the actuarial calculations were as follows:-

Group

2020 2019 % %

Discount rate 7.3 7.3 Future salary increase rate 9.0 9.0

Sensitivity analysis:-

Reasonably possible changes to the key assumptions, would have affected the defined benefit obligations by the amounts shown below:-

2020 2019

RM’000 RM’000 RM’000 RM’000 Increase Decrease Increase Decrease

Discount rate (1% movement) 1,172 1,303 923 1,029 Future salary increase rate (1% movement) 1,701 1,562 1,339 1,224

This analysis provides an approximation of the sensitivity of the assumption shown, but does not take account of the variability in the timing of distribution of benefit payments expected under the plan.

268 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

36. PROVISION FOR LIABILITIES AND CHARGES

Rectification Damages works Restructuring claims 36(a) 36(b) 36(c) Total Note RM’000 RM’000 RM’000 RM’000

Group – 2020 At beginning of the financial year 6,528 39,903 101,182 147,613 Currency translation differences (6) 43 2,192 2,229 Charged to Income Statements 7 – (4,437) – (4,437) Payments (1,712) (7,092) – (8,804)

At end of the financial year 4,810 28,417 103,374 136,601

Group – 2019 At beginning of the financial year 8,132 35,382 102,491 146,005 Currency translation differences 134 (79) 165 220 Charged to Income Statements 7 – 8,219 (699) 7,520 Payments (1,738) (3,619) (775) (6,132)

At end of the financial year 6,528 39,903 101,182 147,613

(a) Rectification works

The provision relates to the estimated cost of rectification works for completed project.

(b) Restructuring

The provision for liabilities and charges relates to scaling down of operations, environmental liabilities and asset retirement obligation.

(c) Damages claims

The provision of damages claims relate to projects undertaken by subsidiaries and are recognised for expected damages claims based on the term of the applicable agreements.

269 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

37. TRADE AND OTHER PAYABLES

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Trade payables 1,331,951 2,011,355 – – Other payables 605,750 633,442 879 720 Deferred income 8,138 10,491 – – Security deposits 117,802 112,510 – – Accrued expenses* 981,288 917,254 16,583 16,768

3,044,929 3,685,052 17,462 17,488

* Accrued expenses mainly comprise interest payables, regulatory costs and capital expenditure.

The credit terms of trade payables granted to the Group vary from 30 days to 180 days (2019: 30 days to 180 days). Other credit terms are assessed and approved on a case-by-case basis.

38. FINANCIAL RISK MANAGEMENT

The Group’s and the Company’s operations are subject to foreign currency exchange risk, interest rate risk, price risk, credit risk and liquidity risk.

The Group’s and the Company’s financial risk management policy seeks to ensure that adequate resources are available to manage the above risks and to create value for its shareholders. It is not the Group’s and the Company’s policy to engage in speculative transactions.

The Board of Directors reviews and agrees policies and procedures for managing each of these risks and they are summarised below:

(a) Foreign currency exchange risk

Foreign currency exchange risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

The Group is exposed to risks arising from various currency exposures primarily with respect to the Great British Pounds (“GBP”) and Singapore Dollars (“SGD”). The Group has investments in foreign operations whose net assets are exposed to foreign currency translation risk. Such exposures are mitigated through borrowings denominated in the respective functional currencies.

Where necessary, the Group enters into forward foreign currency exchange contracts to limit its exposure on foreign currency receivables and payables, and on cash flows generated from anticipated transactions denominated in foreign currencies.

There is no significant exposure to foreign currency exchange risk for the Group and the Company.

270 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

38. FINANCIAL RISK MANAGEMENT (CONT’D.)

(b) Hedge of a net investment in Australia

As the reporting date, the Group’s investment in its Australia subsidiaries are hedged by AUD bank loan with a carrying amount of RM1.2 billion (AUD408.1 million) which mitigates the currency risk arising from the subsidiary’s net assets. The loan is designated as a net investment hedge.

The Group determines the existence of an economic relationship between the above hedging instrument and hedged item based on the currency and amount. The Group has established a hedge ratio of 1 : 0.8 as the underlying risk of the hedging instrument is identical to the hedged risk component. The Group has assessed the effectiveness of the above hedging relationship at the reporting date by comparing changes in the carrying amount of the loan that is attributable to changes in the exchange rate with the changes in the net investment in the foreign operation due to movements in the exchange rate.

(c) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of the Group’s and the Company’s financial instruments will fluctuate because of changes in market interest rates.

The Group’s and the Company’s exposure to interest rate risk arise primarily from their floating rate bonds and borrowings, which is partially offset by the deposits and short-term investments held at variable rates. The Group and the Company manage their cash flow interest rate risk by using a mix of fixed and variable rate debts. Derivative financial instruments are used, where appropriate, to generate the desired interest rate profile.

The interest rate profile of the Group’s and the Company’s significant interest-bearing financial instruments, based on their carrying amounts as at the reporting date, are as follows:-

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Fixed rate instruments Financial liabilities 19,490,639 20,188,682 2,500,000 2,510,000

Variable rate instruments Financial assets 11,309,168 11,497,578 857,269 995,637 Financial liabilities 24,075,239 25,891,106 1,750,654 1,467,970

35,384,407 37,388,684 2,607,923 2,463,607

At the reporting date, if the interest rates had been 50 basis points lower/higher, with all other variables held constant, the Group’s and the Company’s profit after tax would be higher/lower by approximately RM120.4 million (2019: RM129.5 million) and RM8.8 million (2019: RM7.3 million), respectively, as a result of lower/higher interest expense on borrowings.

The Group and the Company do not account for any fixed rate instruments at fair value through profit or loss. Therefore, a change in interest rates at the reporting date would not affect their profit after tax.

271 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

38. FINANCIAL RISK MANAGEMENT (CONT’D.)

(c) Interest rate risk (cont’d.)

The excess funds of the Group and the Company are invested in bank deposits and other short-term instruments. The Group and the Company manage their liquidity risks by placing such excess funds on short-term maturities to match its cash flow needs. If interest deposit rates increased/decreased by 10 basis points, interest income of the Group and the Company for the financial year would increase/decrease by RM11.3 million (2019: RM11.5 million) and RM1.0 million (2019: RM1.0 million), respectively.

(d) Price risk

Equity price risk

The Group’s and the Company’s exposure to equity price risk arise primarily from their investments in quoted securities.

To manage their price risk arising from investments in equity securities, the Group and the Company diversify their portfolio.

At the reporting date, the Group’s and the Company’s exposure to quoted equity investments at fair value are RM1,422,160,000 (2019: RM1,543,440,000) and RM10,382,000 (2019: RM10,503,000), respectively.

The following table demonstrates the indicative effects on the Group’s and the Company’s equity applying reasonably foreseeable market movements in the quoted market prices at the reporting date, assuming all other variables remain constant.

Increase/ Decrease in quoted Carrying market Effect on amounts prices equity RM’000 % RM’000

Group – 2020 Local equities 487,270 +/- 10 48,727 Foreign equities 934,890 +/- 10 93,489

Group – 2019 Local equities 646,695 +/- 10 64,670 Foreign equities 896,745 +/- 10 89,675

Company – 2020 Local equities 3,071 +/- 10 307 Foreign equities 7,809 +/- 10 781

Company – 2019 Local equities 4,155 +/- 10 416 Foreign equities 6,348 +/- 10 635

272 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

38. FINANCIAL RISK MANAGEMENT (CONT’D.)

(d) Price risk (cont’d.)

Fuel commodity price risk

The Group hedges its fuel commodity price risk by the use of derivative instruments against fluctuations in fuel oil prices which affect the cost of fuel.

The Group has contracts for the sale of electricity to the Singapore electricity pool at prices that are fixed in advance every three months and to retail customers (those meeting a minimum average monthly consumption) at prices that are either fixed in amount or in pricing formula for periods up to a number of years. The fixing of the prices under the contracts is based largely on the price of fuel oil required to generate the electricity. The Group enters into fuel oil swaps to hedge against adverse price movements of fuel oil prices. The Group typically enters into a swap to pay a fixed price and receive a variable price indexed to a benchmark fuel price index.

Exposure to price fluctuations arising from the purchase of fuel oil and natural gas are substantially managed via swaps where the price is indexed to a benchmark fuel price index, for example 180 CST fuel oil and Dated Brent. The Group’s exposure to the fluctuation of forward price curve is immaterial.

(e) Credit risk

Credit risk is the potential financial loss resulting from the failure of a counterparty to settle their obligations to the Group and the Company.

The Group’s exposure to credit risk arises primarily from trade and other receivables. Meanwhile, the Company’s exposures to credit risk arise from other receivables. For other financial assets (including investment securities, cash and cash equivalents and derivative financial instruments), the Group and the Company minimises credit risk by dealing exclusively with high credit rating counterparties.

Concentration of credit risk

Due to the nature of the Group’s business, customers are mainly segregated according to business segments. In the Group’s power generation business in Malaysia, trade receivables are solely from its off taker, a national electricity utility company and the counterparty risk is considered to be minimal. As for the Group’s power generation business in Singapore, credit reviews are performed on all customers with established credit limits and generally supported by collateral in the form of guarantees. For the Group’s water and sewerage business, the credit risk of receivables is mitigated through strict collection procedures. The Directors are of the view that credit risk arising from these businesses is limited due to the large customer base.

Trade receivables, unbilled receivables and contract assets

The Group applies the MFRS 9 simplified approach to measure ECL which uses a lifetime expected loss allowance for all trade receivables, unbilled receivables and contract assets. To measure the ECL, trade receivables, unbilled receivables and contract assets have been grouped based on shared credit risk characteristics and the days past due.

273 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

38. FINANCIAL RISK MANAGEMENT (CONT’D.)

(e) Credit risk (cont’d.)

Trade receivables, unbilled receivables and contract assets (cont’d.)

The expected loss rates are determined based on 1 year to 13 years of historical ageing profile and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect forward-looking information on macroeconomic factors affecting the ability of the customers to settle the receivables. Some of the factors which the Group has identified include unemployment rate, economic trends, and annual Gross Domestic Product (“GDP”) growth and has adjusted the historical loss rates based on expected changes in such factors.

On that basis, the loss allowance was determined as follows for trade receivables, unbilled receivables, contract assets and related parties:-

<–––––-–-–––––––––––– Past due ––––––-––––-––––––––> Current 1 – 90 days 91 – 120 days > 120 days Total RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020 Gross carrying amount – Trade receivables 1,045,367 169,582 45,814 844,668 2,105,431 – Unbilled receivables 766,106 – – – 766,106 – Contract assets 202,118 – – – 202,118

2,013,591 169,582 45,814 844,668 3,073,655

Allowance for impairment – Trade receivables (12,631) (21,203) (10,353) (513,043) (557,230) – Unbilled receivables (7,568) – – – (7,568) – Contract assets (110) – – – (110)

(20,309) (21,203) (10,353) (513,043) (564,908)

Net carrying amount 1,993,282 148,379 35,461 331,625 2,508,747

274 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

38. FINANCIAL RISK MANAGEMENT (CONT’D.)

(e) Credit risk (cont’d.)

Trade receivables, unbilled receivables and contract assets (cont’d.)

<–––––-–-–––––––––––– Past due ––––––-––––-––––––––> Current 1 – 90 days 91 – 120 days > 120 days Total RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2019 Gross carrying amount – Trade receivables 1,794,997 327,834 16,322 660,924 2,800,077 – Unbilled receivables 962,863 – – – 962,863 – Contract assets 208,806 – – – 208,806

2,966,666 327,834 16,322 660,924 3,971,746

Allowance for impairment – Trade receivables (66,343) (15,971) (5,824) (402,979) (491,117) – Contract assets (388) – – – (388)

(66,731) (15,971) (5,824) (402,979) (491,505)

Net carrying amount 2,899,935 311,863 10,498 257,945 3,480,241

At the reporting date, the maximum exposure to credit risk of the financial assets of the Group and the Company are represented by the carrying amounts in the Statement of Financial Position, except for the Group’s trade receivables on electricity and steam sales where the Group will assess each customer individually and typically require collateral in the form of bankers’ guarantees or deposits from selected customers.

Cash and bank balances

The Group and the Company place its cash and bank balances with a number of creditworthy financial institutions. The Group’s and the Company’s policy limit the concentration of financial exposure to any single financial institution. While cash and bank balances are also subject to the impairment requirements of MFRS 9, the identified impairment loss was immaterial.

Derivative financial instruments

Transactions involving derivative financial instruments are allowed only with counterparties that are of high credit quality. As such, management does not expect any counterparties to fail to meet their obligations. The Group and the Company consider the risk of material loss on the event of non-performance by a financial counter party to be unlikely.

Other receivables

The Group and the Company use the 3-stages approach for the ECL on the other receivables and amount due from related parties. The 3-stages approach reflects their receivables’ credit risk and how the loss allowance is determined for each of those categories.

275 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

38. FINANCIAL RISK MANAGEMENT (CONT’D.)

(e) Credit risk (cont’d.)

Other receivables (cont’d.)

A summary of the assumptions underpinning the Group’s and the Company’s ECL model is as follows:-

Category Group’s and Company’s definition of category Basis for recognising ECL

Performing Debtors have a low risk of default and a strong capacity to meet 12 month ECL contractual cash flows. Underperforming Debtors for which there is a significant increase in credit risk is presumed Lifetime ECL if interest and/or principal repayments are 90 days past due. Non-performing Debtors and repayments are more than 365 days past due. Lifetime ECL Write-off There is evidence indicating that there is no reasonable expectation Asset is written off of recovery based on unavailability of debtor’s sources of income or assets to generate sufficient future cash flows to repay the amount.

Based on the above, loss allowance is measured on either 12 month ECL or lifetime ECL using a PD x LGD x EAD methodology where:- • PD (‘probability of default’) – the likelihood that the debtor would not be able to repay during the contractual period; • LGD (‘loss given default’) – the percentage of contractual cash flows will not be collected if default happens; and • EAD (‘exposure at default’) – the outstanding amount that is exposed to default risk.

In deriving the PD and LGD, the Group and the Company consider historical date by each debtor by category and adjusts for forward-looking macroeconomic data. The Group and the Company have identified the industry and geographical area which the debtor operates in to be the most relevant factors, and accordingly adjusts the historical loss rates based on expected changes in these factors. Loss allowance is measured at a probability-weighted amount that reflects the possibility that a credit loss occurs and the possibility that no credit loss occurs. No significant changes to estimation techniques or assumptions were made during the reporting period.

The maximum credit risk exposure of the financial assets of the Group and the Company are approximately their carrying amounts as at the end of the reporting period.

276 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

38. FINANCIAL RISK MANAGEMENT (CONT’D.)

(e) Credit risk (cont’d.)

Movement on the Group’s and the Company’s loss allowances is as follows:-

Trade Unbilled Contract Related Other receivables receivables assets parties receivables Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020 At 1 July 2019 491,117 – 388 34 160,580 652,119 Arising from acquisition 7,158 – – – 199 7,357 Allowance for impairment of receivables 160,965 7,615 – 100 1,979 170,659 Derecognition of subsidiary (2,201) – – – – (2,201) Write back of impairment of receivables (12,285) – (278) – (4,629) (17,192) Written off during the financial year as uncollectible (88,238) – – – (1,699) (89,937) Exchange differences 714 (47) – – 318 985

At 30 June 2020 557,230 7,568 110 134 156,748 721,790

Trade Contract Related Other receivables assets parties receivables Total RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2019 At 1 July 2018 490,009 445 – 84,109 574,563 Arising from acquisition 6,625 – – – 6,625 Allowance for impairment of receivables 89,128 – 34 76,001 165,163 Write back of impairment of receivables (9,605) (57) – (390) (10,052) Written off during the financial year as uncollectible (80,916) – – – (80,916) Exchange differences (4,124) – – 860 (3,264)

At 30 June 2019 491,117 388 34 160,580 652,119

277 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

38. FINANCIAL RISK MANAGEMENT (CONT’D.)

(e) Credit risk (cont’d.)

Related Other parties receivables Total RM’000 RM’000 RM’000

Company – 2020 At 1 July 2019/30 June 2020 116,859 1,765 118,624

Company – 2019 At 1 July 2018/30 June 2019 116,859 1,765 118,624

(f) Liquidity risk

Liquidity risk is the risk that the Group and the Company will encounter difficulty in meeting financial obligations due to shortage of funds. The Group’s and the Company’s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities.

The Group’s and the Company’s objective are to maintain a balance between continuity of funding and flexibility through the use of stand-by credit facilities.

278 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

38. FINANCIAL RISK MANAGEMENT (CONT’D.)

(f) Liquidity risk (cont’d.)

The table below summarises the maturity profile of the Group’s and the Company’s financial liabilities at the reporting date based on contractual undiscounted repayment obligations:-

On demand or within 1 year 1 to 5 years Over 5 years Total RM’000 RM’000 RM’000 RM’000

Group – 2020 Non-derivative: Trade and other payables 3,115,572 169,997 – 3,285,569 Bonds and borrowings 12,764,591 17,744,755 27,742,528 58,251,874 Lease liabilities 270,109 830,439 1,192,724 2,293,272 Related parties 39,212 – – 39,212

16,189,484 18,745,191 28,935,252 63,869,927

Derivative: Fuel oil swaps 171,711 13,299 – 185,010 Currency forwards 3,233 2,103 – 5,336

174,944 15,402 – 190,346

Company – 2020 Non-derivative: Trade and other payables 17,462 – – 17,462 Bonds and borrowings 1,939,236 1,375,080 2,037,850 5,352,166 Lease liabilities 7,074 2,358 – 9,432 Related parties 4,709 – – 4,709

1,968,481 1,377,438 2,037,850 5,383,769

279 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

38. FINANCIAL RISK MANAGEMENT (CONT’D.)

(f) Liquidity risk (cont’d.)

The table below summarises the maturity profile of the Group’s and the Company’s financial liabilities at the reporting date based on contractual undiscounted repayment obligations: (cont’d.)

On demand or within 1 year 1 to 5 years Over 5 years Total RM’000 RM’000 RM’000 RM’000

Group – 2019 Non-derivative: Trade and other payables 3,674,378 272,645 - 3,947,023 Bonds and borrowings 16,906,218 19,411,741 26,676,237 62,994,196 Related parties 16,006 - - 16,006

20,596,602 19,684,386 26,676,237 66,957,225

Derivative: Net – interest rate swaps 19,182 17,559 - 36,741 Fuel oil swaps 38,642 14,272 - 52,914 Currency forwards 9,633 1,885 309 11,827 Currency options contract 668 2,665 - 3,333

68,125 36,381 309 104,815

Company – 2019 Non-derivative: Trade and other payables 17,488 - - 17,488 Bonds and borrowings 4,105,268 2,911,767 2,053,777 9,070,812 Related parties 5,546 - - 5,546

4,128,302 2,911,767 2,053,777 9,093,846

280 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

39. FINANCIAL INSTRUMENTS

(a) Categories of financial instruments

The table below provides an analysis of financial instruments categorised as follows:

<------Financial Assets ------> Fair value Derivatives Amortised through used for cost profit or loss hedging FVOCI Total Note RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2020 Non-current Investments 18 – 362,195 – 42,716 404,911 Trade and other receivables 20 1,353,360 – – – 1,353,360 Derivative financial instruments 21 – – 10,585 – 10,585

Current Investments 18 – 2,301,989 – – 2,301,989 Derivative financial instruments 21 – 8,712 65,547 – 74,259 Trade and other receivables 20 2,844,373 – – – 2,844,373 Amount due from related parties 25 53,694 – – – 53,694 Fixed deposits 26 10,396,221 – – – 10,396,221 Cash and bank balances 26 1,265,011 – – – 1,265,011 Total 15,912,659 2,672,896 76,132 42,716 18,704,403

<------Financial Liabilities ------> Fair value Derivatives through used for Amortised profit or loss hedging cost Total Note RM’000 RM’000 RM’000 RM’000

Group – 2020 Non-current Long-term payables 29 – – 169,996 169,996 Bonds 30 – – 19,655,639 19,655,639 Borrowings 31 – – 12,592,683 12,592,683 Lease liabilities 32 – – 1,447,352 1,447,352 Derivatives financial instruments 21 13,575 1,826 – 15,401

Current Trade and other payables 37 – – 3,036,791 3,036,791 Derivatives financial instruments 21 – 174,944 – 174,944 Amount due to related parties 25 – – 39,212 39,212 Bonds 30 – – 220,000 220,000 Borrowings 31 – – 11,097,556 11,097,556 Lease liabilities 32 – – 176,495 176,495

Total 13,575 176,770 48,435,724 48,626,069

281 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

39. FINANCIAL INSTRUMENTS (CONT’D.)

(a) Categories of financial instruments (cont’d.)

The table below provides an analysis of financial instruments categorised as follows: (cont’d.)

<------Financial Assets ------> Fair value Amortised through cost profit or loss FVOCI Total Note RM’000 RM’000 RM’000 RM’000

Company – 2020 Non-current Investments 18 – 35,226 9,599 44,825

Current Trade and other receivables 20 6,012 – – 6,012 Amount due from related parties 25 1,303,468 – – 1,303,468 Investments 18 – 755,199 – 755,199 Fixed deposits 26 102,070 – – 102,070 Cash and bank balances 26 1,929 – – 1,929

Total 1,413,479 790,425 9,599 2,213,503

<------Financial Liabilities ------> Amortised cost Total Note RM’000 RM’000

Company – 2020 Non-current Bonds 30 2,500,000 2,500,000 Lease liabilities 32 2,479 2,479

Current Trade and other payables 37 17,462 17,462 Amount due to related parties 25 4,708 4,708 Borrowings 31 1,750,654 1,750,654 Lease liabilities 32 7,254 7,254

Total 4,282,557 4,282,557

282 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

39. FINANCIAL INSTRUMENTS (CONT’D.)

(a) Categories of financial instruments (cont’d.)

The table below provides an analysis of financial instruments categorised as follows:

<------Financial Assets ------> Fair value Derivatives Amortised through used for cost profit or loss hedging FVOCI Total Note RM’000 RM’000 RM’000 RM’000 RM’000

Group – 2019 Non-current Investments 18 – 346,510 – 63,461 409,971 Trade and other receivables 20 273,480 871,752 – – 1,145,232 Derivative financial instruments 21 – – 18,722 – 18,722

Current Investments 18 – 2,352,947 – – 2,352,947 Derivative financial instruments 21 – 945 64,077 – 65,022 Trade and other receivables 20 3,894,034 – – – 3,894,034 Amount due from related parties 25 31,131 – – – 31,131 Fixed deposits 26 10,635,496 – – – 10,635,496 Cash and bank balances 26 1,171,006 – – – 1,171,006

Total 16,005,147 3,572,154 82,799 63,461 19,723,561

<------Financial Liabilities ------> Fair value Derivatives through used for Amortised profit or loss hedging cost Total Note RM’000 RM’000 RM’000 RM’000

Group – 2019 Non–current Long-term payables 29 – – 272,645 272,645 Bonds 30 – – 18,961,666 18,961,666 Borrowings 31 – – 11,760,855 11,760,855 Derivatives financial instruments 21 9,782 44,334 – 54,116

Current Trade and other payables 37 – – 3,674,561 3,674,561 Derivatives financial instruments 21 – 63,491 – 63,491 Amount due to related parties 25 – – 16,006 16,006 Bonds 30 – – 520,024 520,024 Borrowings 31 – – 14,837,243 14,837,243

Total 9,782 107,825 50,043,000 50,160,607

283 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

39. FINANCIAL INSTRUMENTS (CONT’D.)

(a) Categories of financial instruments (cont’d.)

The table below provides an analysis of financial instruments categorised as follows: (cont’d.)

<------Financial Assets ------> Fair value Amortised through cost profit or loss FVOCI Total Note RM’000 RM’000 RM’000 RM’000

Company – 2019 Non-current Investments 18 – 34,968 9,477 44,445

Current Trade and other receivables 20 12,982 – – 12,982 Amount due from related parties 25 1,014,435 – – 1,014,435 Investments 18 – 797,277 – 797,277 Fixed deposits 26 198,360 – – 198,360 Cash and bank balances 26 122,948 – – 122,948

Total 1,348,725 832,245 9,477 2,190,447

<------Financial Liabilities ------> Amortised cost Total Note RM’000 RM’000

Company – 2019 Non-current Bonds 30 2,500,000 2,500,000 Borrowings 31 550 550

Current Trade and other payables 37 17,488 17,488 Amount due to related parties 25 5,546 5,546 Bonds 30 10,000 10,000 Borrowings 31 1,467,420 1,467,420

Total 4,001,004 4,001,004

284 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

39. FINANCIAL INSTRUMENTS (CONT’D.)

(b) Fair value measurement

The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:

(i) Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.

(ii) Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. prices) or indirectly (i.e. derived from prices).

(iii) Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

At the reporting date, the Group and the Company held the following financial instruments carried at fair value on the Statements of Financial Position:

Level 1 Level 2 Level 3 Total RM’000 RM’000 RM’000 RM’000

Group – 2020 Assets Financial assets at fair value through profit or loss: – Trading derivatives – 8,712 – 8,712 – Income/equity funds – 2,326,334 323,363 2,649,697 – Equity investments 10,880 3,607 – 14,487 Derivatives used for hedging – 76,132 – 76,132 Financial assets at fair value through other comprehensive income 22,238 412 20,066 42,716

Total 33,118 2,415,197 343,429 2,791,744

Liabilities Financial liabilities at fair value through profit or loss: – Trading derivatives – 13,575 – 13,575 Derivative used for hedging – 176,770 – 176,770

Total – 190,345 – 190,345

285 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

39. FINANCIAL INSTRUMENTS (CONT’D.)

(b) Fair value measurement (cont’d.)

At the reporting date, the Group and the Company held the following financial instruments carried at fair value on the Statements of Financial Position: (cont’d.)

Level 1 Level 2 Level 3 Total RM’000 RM’000 RM’000 RM’000

Group – 2019 Assets Financial assets at fair value through profit or loss: – Trading derivatives – 945 – 945 – Income/equity funds – 2,377,412 307,902 2,685,314 – Equity investments 10,503 3,640 – 14,143 – Receivables from a joint venture – – 871,752 871,752 Derivatives used for hedging – 82,799 – 82,799 Financial assets at fair value through other comprehensive income 42,072 46 21,343 63,461

Total 52,575 2,464,842 1,200,997 3,718,414

Liabilities Financial liabilities at fair value through profit or loss: – Currency options contracts 3,333 – – 3,333 – Trading derivatives – 6,449 – 6,449 Derivative used for hedging – 107,825 – 107,825

Total 3,333 114,274 – 117,607

286 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

39. FINANCIAL INSTRUMENTS (CONT’D.)

(b) Fair value measurement (cont’d.)

At the reporting date, the Group and the Company held the following financial instruments carried at fair value on the Statements of Financial Position: (cont’d.)

Level 1 Level 2 Level 3 Total RM’000 RM’000 RM’000 RM’000

Company – 2020 Assets Financial assets at fair value through profit or loss 10,880 755,199 24,346 790,425 Financial assets at fair value through other comprehensive income 5 - 9,594 9,599

Total 10,885 755,199 33,940 800,024

Company – 2019 Assets Financial assets at fair value through profit or loss 10,503 797,277 24,465 832,245 Financial assets at fair value through other comprehensive income 5 - 9,472 9,477

Total 10,508 797,277 33,937 841,722

During the current financial year, there were no transfers between Level 1 and Level 2 fair value measurements.

40. SIGNIFICANT RELATED PARTY TRANSACTIONS

For the purpose of these financial statements, parties are considered to be related to the Group if the Group or the Company has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group or the Company and the party are subject to common control or common significant influence. Related parties may be individuals or other entities.

Key management personnel are defined as those persons having authority and responsibility for planning, directing and controlling the activities of the Group either directly or indirectly. The key management personnel include all the Directors of the Group.

287 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

40. SIGNIFICANT RELATED PARTY TRANSACTIONS (CONT’D.)

(a) Significant related party transactions

(i) In addition to related party disclosures mentioned elsewhere in the financial statements, set out below are other significant related party transactions.

Group

2020 2019 Entity Relationship Type of transactions RM’000 RM’000

Business & Budget Hotels Associated Management fee, incentive fee and 767 1,225 (Kuantan) Sdn. Bhd. company software maintenance cost . Lease rental of investment 6,300 6,300 property Commercial Central Sdn. Bhd. Subsidiary of Rental of office and car park 2,314 2,735 holding company Corporate Promotions Sdn. Subsidiary of Advertising & promotion expenses 2,377 3,025 Bhd. holding company Express Rail Link Sdn. Bhd. Associated Progress billings related to civil 7,420 26,577 company engineering & construction works East West Ventures Sdn. Bhd. Subsidiary of Lease rental of investment 21,626 21,626 holding company property East West Ventures Sdn. Bhd. Subsidiary of Hotel accommodation & lease rental 2,665 3,647 holding company of equipment Share operating cost 539 445 Rental income from outsource of 17,602 7,058 hotel rooms Starhill Global REIT Associated Lease expense 13,653 – company Progress billing 78,510 – Management fee 10,267 – Oriental Place Sdn. Bhd. Subsidiary of Rental of premises expenses 7,440 7,975 holding company Syarikat Pelanchongan Pangkor Subsidiary of Lease rental of investment property 8,820 8,820 Laut Sendirian Berhad holding company Hotel accommodation 1,138 2,754 Management fees & data processing 1,726 2,173 fees & royalty income Sale of property, plant and equipment – 5,529

288 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

40. SIGNIFICANT RELATED PARTY TRANSACTIONS (CONT’D.)

(a) Significant related party transactions (cont’d.)

(i) In addition to related party disclosures mentioned elsewhere in the financial statements, set out below are other significant related party transactions. (cont’d.)

Group

2020 2019 Entity Relationship Type of transactions RM’000 RM’000

Thunder Match Technology Sdn. Subsidiary of Commission, incentives and/or 1,675 4,475 Bhd. associated reimbursement of bundle device company sold Xchanging Malaysia Sdn. Bhd. Joint venture IT Consultancy & related services 36,425 42,093 company expenses

Company

2020 2019 Entity Relationship Type of transactions RM’000 RM’000

YTL Land & Development Berhad Subsidiary ICULS interest income 9,731 21,511 Suri Travel & Tours Sdn. Bhd. Subsidiary Travelling expenses 1,081 1,290 Hotel accommodation & related Star Hill Hotel Sdn. Bhd. Subsidiary expenses 606 705

(ii) The following significant transactions which have been transacted with close family members of key management personnel and entities controlled by key management personnel and close family members are as follows:

Group

2020 2019 RM’000 RM’000

Progress billings related to purchase of properties 78,766 43,602

The Directors are of the opinion that the above transactions have been entered into in the normal course of business and have been established on terms and conditions negotiated and agreed by the related parties.

289 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

40. SIGNIFICANT RELATED PARTY TRANSACTIONS (CONT’D.)

(b) Key management personnel compensation

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Group and the Company, directly or indirectly, including any Director (whether executive or otherwise) of the Company.

Key management personnel of the Group and the Company includes the Directors of the Company.

Group Company

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Directors’ and key management personnel’s remuneration – Short-term employee benefits 59,882 76,416 1,985 997 – defined contribution plans 4,616 6,334 134 12 – benefits-in-kind 1,294 772 – – – share option expenses 7,909 7,909 4,735 4,735

73,701 91,431 6,854 5,744

41. COMMITMENTS

(a) Capital commitments

Group

2020 2019 RM’000 RM’000

Authorised but not contracted for 782,205 795,078 Contracted but not provided for 1,088,500 2,517,419

The above commitments mainly comprise purchase of spare parts and property, plant and equipment.

Group

2020 2019 RM’000 RM’000

Capital commitments in relation to addition investment 75,174 72,880

290 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

41. COMMITMENTS (CONT’D.)

(b) Operating lease commitments

(i) The Group as lessee

The Group leases land, offices and warehouses under non-cancellable operating lease agreements. The leases have varying terms, escalation clauses and renewal rights. Except for a few long-term leases in land, the Group’s leases generally range from one to five years. None of the leases included contingent rentals.

Future minimum lease payables under non-cancellable operating leases at the reporting date are as follows:

Group 2019 RM’000

Not later than 1 year 193,993 Later than 1 year and not later than 5 years 366,051 Later than 5 years 473,658

1,033,702

As disclosed in Note 2(b), the Group has adopted MFRS 16 on 1 July 2019. These lease payments have been recognised as ROU assets and lease liabilities on the Statements of Financial Position as at 30 June 2020, except for short-term and low value leases.

(ii) The Group as lessor

For the financial year ended 30 June 2020

The Group leases out its land and building, telecommunications equipment, plant and machinery. The Group classified these leases as operating leases, because they do not transfer substantially all of the risks and rewards incidental to the ownership of the assets. The following table sets out the maturity schedule of undiscounted lease payments to be received after the reporting date.

Group 2020 RM’000

Less than 1 year 168,860 Between 1 to 2 years 121,113 Between 2 to 3 years 116,035 Between 3 to 4 years 110,862 Between 4 to 5 years 94,272 Later than 5 years 73,979

Total undiscounted lease payments to be received 685,121

Those leases classified as finance leases are disclosed in Note 32(a).

291 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

41. COMMITMENTS (CONT’D.)

(b) Operating lease commitments (cont’d.)

(ii) The Group as lessor (cont’d.)

For the financial year ended 30 June 2019

The future minimum lease receivables under non-cancellable operating leases at the reporting date are as follows:

Group 2019 RM’000

Not later than 1 year 594,941 Later than 1 year and not later than 5 years 1,525,156 Later than 5 years 672,479

2,792,576

Except for one long-term lease, the Group’s leases for its retail properties generally range from one to five years. The future minimum lease payments receivable relating to retail properties from non-related parties are approximately RM3.3 billion. The Group leases out its hotel properties under operating leases for the lease term of fifteen years. All lease arrangements are provided with a step-up rate of 5% every five years and an option to grant the respective lessees to renew the lease for a further term similar to the original lease agreements. The future minimum lease payments receivable relating to hotel properties from non-related parties are approximately RM334 million.

In addition, the payments receivable under the power purchase agreement (“PPA”) which are classified as operating lease are as follows:

Group

2020 2019 RM’000 RM’000

Not later than 1 year 55,874 60,779 Later than 1 year and not later than 5 years 9,839 65,821

292 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

42. SEGMENTAL INFORMATION

The Group has seven reportable segments as described below:

(a) Construction (b) Information technology & e-commerce related business (c) Hotel operations (d) Cement manufacturing & trading (e) Management services & others (f) Property investment & development (g) Utilities

Management has determined the operating segments based on the reports reviewed by the chief operating decision-maker (“CODM”) that are used to make strategic decisions.

The CODM receives separate reports for power generation (contracted), Multi utilities business (merchant), water and sewerage and mobile broadband network, they have been aggregated into one reportable segments (Utilities) as they have similar economic characteristics and those detail segments information disclosed in YTL Power International Berhad’s annual report which available for public use.

Although the information technology & e-commerce related business segment does not meet the quantitative thresholds required by MFRS 8 for reportable segments, management has concluded that this segment should be reported, as it is closely monitored by CODM as important segment.

The CODM considers the business from both a geographic and business segment perspective. Geographically, management manages and monitors the business in three primary geographic areas: Malaysia, United Kingdom and Singapore. The details of the geographical segments are disclosed in the below note of the financial statements.

293 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

42. SEGMENTAL INFORMATION (CONT’D.)

The segment information provided to the CODM for the reportable segments is as follows:

Information technology & e–commerce Cement Management Property related Hotel manufacturing services investment & Construction business operations & trading & others development Utilities Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

2020 Revenue Total revenue 2,345,514 8,361 1,134,146 4,117,832 612,702 1,206,981 10,341,524 19,767,060 Inter–segment revenue (29,509) (4,820) (12,481) (22,658) (240,993) (211,727) (66,423) (588,611)

External revenue 2,316,005 3,541 1,121,665 4,095,174 371,709 995,254 10,275,101 19,178,449

Results Interest income 17,482 3,873 2,257 30,944 17,593 10,213 12,823 95,185 Finance costs (5,199) (2) (22,940) (252,926) (615,938) (271,013) (692,729) (1,860,747) Share of results of associated companies and joint ventures – – 4,041 13,417 (40,228) (173,286) 453,255 257,199 Segment profit before tax 194,681 41 96,563 (2,468) 179,628 (282,769) 233,618 419,294

Segment assets Investment in associated companies and joint ventures – – 36,715 48,670 51,931 2,022,190 2,222,511 4,382,017 Other segment assets 1,187,730 93,128 2,701,767 9,642,046 13,166,329 7,259,250 31,476,168 65,526,418

Segment liabilities Bonds and borrowings 378,726 – 926,006 4,824,394 14,269,038 3,985,054 19,182,660 43,565,878 Other segment liabilities 386,390 420 329,029 1,009,239 946,939 1,197,115 6,863,496 10,732,628

Other segment information Capital expenditure 24,543 39 115,418 126,930 56,707 559,511 1,533,374 2,416,522 Impairment/(write back) – 1,744 (5,461) 31,954 2,110 32,218 120,638 183,203 Depreciation and amortisation 18,772 648 81,018 407,618 16,286 148,295 1,154,577 1,827,214

294 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

42. SEGMENTAL INFORMATION (CONT’D.)

The segment information provided to the CODM for the reportable segments is as follows: (cont’d.)

Information technology & e–commerce Cement Management Property related Hotel manufacturing services investment & Construction business operations & trading & others development Utilities Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

2019 Revenue Total revenue 1,360,876 84,375 1,239,796 2,681,555 737,473 1,343,209 11,381,864 18,829,148 Inter-segment revenue (141,377) (80,553) (16,415) (7,303) (281,427) (239,913) (14,632) (781,620)

External revenue 1,219,499 3,822 1,223,381 2,674,252 456,046 1,103,296 11,367,232 18,047,528

Results Interest income 9,536 8,431 1,691 27,410 20,657 11,080 7,911 86,716 Finance costs (16) – (23,943) (78,097) (641,134) (291,481) (712,828) (1,747,499) Share of results of associated companies and joint ventures – – 7,326 14,799 (12,424) 854 400,540 411,095 Segment profit before tax 80,497 2,560 176,576 145,473 14,887 (8,825) 625,339 1,036,507

Segment assets Investment in associated companies and joint ventures – – 40,777 487,495 92,052 28,047 2,196,978 2,845,349 Other segment assets 1,082,207 102,704 2,607,860 9,485,356 13,442,398 16,568,410 30,592,809 73,881,744

Segment liabilities Bonds and borrowings 15,259 – 799,770 4,884,144 14,943,993 7,766,445 17,670,177 46,079,788 Other segment liabilities 791,269 5,742 364,346 1,191,630 766,283 596,667 6,036,827 9,752,764

Other segment information Capital expenditure 33,716 163 150,087 118,949 35,682 753,064 1,569,080 2,660,741 Impairment/(write back) – 81 (203) 6,290 1,020 2,470 149,856 159,514 Depreciation and amortisation 9,877 660 84,682 236,554 17,195 99,211 1,067,802 1,515,981

295 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

42. SEGMENTAL INFORMATION (CONT’D.)

(a) Geographical information

The Group’s seven business segments operate in three main geographical areas:

(i) Malaysia – Construction – Information technology & e–commerce related business – Hotel operations – Cement manufacturing & trading – Management services & others – Property investment & development – Utilities (ii) United Kingdom – Utilities – Hotel operations (iii) Singapore – Utilities – Cement manufacturing & trading – Property investment & development

Revenue Non-current assets

2020 2019 2020 2019 RM’000 RM’000 RM’000 RM’000

Malaysia 7,430,763 5,764,796 12,329,432 10,608,467 United Kingdom 3,647,137 3,648,577 18,786,918 17,934,854 Singapore 6,841,129 7,447,068 8,243,533 17,718,828 Other countries 1,259,420 1,187,087 4,346,176 3,865,355

19,178,449 18,047,528 43,706,059 50,127,504

Non-current assets information presented above consist of the followings items as presented in the Statements of Financial Position.

Non-current assets

2020 2019 RM’000 RM’000

Property, plant and equipment 30,499,583 30,759,493 Right-of-use assets 1,636,035 – Investment properties 1,811,126 10,217,573 Development expenditures 1,128,221 1,127,238 Intangible assets 8,631,094 8,023,200

43,706,059 50,127,504

296 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

42. SEGMENTAL INFORMATION (CONT’D.)

(b) Major customers

The following is the major customer with revenue equal or more than 10 per cent of the Group’s revenue:

2020 2019 RM’000 RM’000 Segment

Energy Market Company 2,452,877 3,184,498 Utilities

43. CAPITAL MANAGEMENT

The primary objectives of the Group’s and the Company’s capital management are to ensure that it maintains healthy capital ratios in order to support its existing business and maximise shareholders’ value.

The Group and the Company manages its capital structure and makes adjustments to it, in the light of changes in economic conditions. To maintain or adjust the capital structure, the Group and the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. There were no changes in the Group’s and the Company’s approach to capital management during the year.

The Group and the Company monitors capital using a debt-to-equity ratio, which is net debt divided by total capital plus net debt. The Group includes within net debt, total borrowings less cash and cash equivalents. Capital includes equity attributable to the owners of the parent.

Group Company

2020 2019 2020 2019 Note RM’000 RM’000 RM’000 RM’000

Bonds 30 19,875,639 19,481,690 2,500,000 2,510,000 Borrowings 31 23,690,239 26,598,098 1,750,654 1,467,970

Bonds and borrowings 43,565,878 46,079,788 4,250,654 3,977,970 Less: Cash and cash equivalents 26 (11,661,232) (11,806,502) (103,999) (321,308)

Net debt 31,904,646 34,273,286 4,146,655 3,656,662

Equity attributable to owners of the parent 12,460,336 13,262,686 6,086,744 6,228,889

Capital and net debt 44,364,982 47,535,972 10,233,399 9,885,551

Debt-to-equity ratio (%) 72 72 41 37

Under the requirement of Bursa Malaysia Securities Berhad Practice Note No. 17/2005, the Company is required to maintain a consolidated shareholders’ equity equal to or not less than the 25 percent of the issued and paid-up capital (excluding treasury shares) and such shareholders’ equity is not less than RM40 million. The Company has complied with this requirement.

297 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

44. SIGNIFICANT CHANGES IN ACCOUNTING POLICIES

The Group’s and the Company’s adoption of MFRS 16 from 1 July 2019 (effective from 1 January 2019) resulted in changes in accounting policies and adjustments to the Group’s and the Company’s financial position as at 1 July 2019. The new accounting policies under MFRS 16 have been disclosed under Note 2(ae) to the financial statements. The following describes the impact of the adoption.

(a) Adoption of MFRS 16

During the financial year, the Group and the Company changed its accounting policies on leases upon adoption of MFRS 16. The Group and the Company have elected to use the modified retrospective transition method and to apply a number of practical expedients as provided in MFRS 16.

Under the modified retrospective transition method, the comparative information was not restated and the cumulative effects of initial application of MFRS 16 where the Group and the Company is a lessee were recognised as an adjustment to the opening balance of retained earnings as at 1 July 2019. The comparative information continued to be reported under the previous accounting policies governed under MFRS 117 Leases (“MFRS 117”) and IC Int. 4 “Determining whether an Arrangement Contains a Lease” (IC Int.4).

As a lessor, the Group and the Company are not required to make any adjustment on transition, except for the reassessment of existing operating subleases at the date of initial application (“DIA”).

In addition, the Group and the Company have elected not to reassess whether a contract is, or contains a lease at the DIA. Instead, for contracts entered into before the transition date the Group and the Company relied on its assessment made applying MFRS 117 and IC Int. 4.

(i) The Group and the Company as lessee

a) Leases classified as operating leases under MFRS 117

On adoption of MFRS 16, the Group recognised lease liabilities in relation to leases which had previously been classified as ‘operating leases’ under the principles of MFRS 117. These liabilities were measured at the present value of the remaining lease payments, discounted using the lessee’s incremental borrowing rate as of 1 July 2019. The weighted-average rate applied is between 1.23% to 4.50%.

ROU assets were measured on a lease-by-lease basis at the amount equal to the lease liability or retrospective calculation, adjusted by the amount of any prepaid or accrued lease payments relating to that lease recognised in the statement of financial position as at 30 June 2019.

As permitted by the exemptions under the standard, the Group and the Company have not applied the principles of MFRS 16 to short-term leases (a lease with lease term of 12 months or less from date of commencement) and leases for which the underlying asset is of low value.

298 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

44. SIGNIFICANT CHANGES IN ACCOUNTING POLICIES (CONT’D.)

(a) Adoption of MFRS 16 (cont’d.)

(i) The Group and the Company as lessee (cont’d.)

a) Leases classified as operating leases under MFRS 117 (cont’d.)

In applying MFRS 16 for the first time, the Group and the Company have applied the following practical expedients permitted by the standard to leases previously classified as operating leases under MFRS 117:

• the use of a single discount rate to a portfolio of leases with reasonably similar characteristics;

• reliance on previous assessments on whether leases are onerous;

• the accounting for operating leases with a remaining lease term of less than 12 months as at 1 July 2019 as short-term leases;

• the exclusion of initial direct costs for the measurement of the ROU asset at the DIA; and

• the use of hindsight in determining the lease term where the contract contains options to extend or terminate the lease.

b) Leases classified as finance leases under MFRS 117

For leases previously classified as finance leases (other than hire purchase creditors) and presented as a part of ‘property, plant and equipment’, the Group and the Company recognised the carrying amount of the lease asset and lease liability immediately before transition which were measured applying MFRS 117 as the carrying amount of the ROU asset and the lease liability at the DIA.

The adoption of MFRS 16 impacts the Group’s performance in the current financial period as below:

(i) On the Income Statements, expenses which previously included leasing expenses within Earnings before Interest, Tax, Depreciation and Amortisation (“EBITDA”) were replaced by interest expense on lease liabilities and depreciation of the right-of-use assets.

(ii) On the Statements of Cash Flows, operating lease rental outflows previously recorded within “net cash flows from operating activities” were reclassified as “net cash flows used in financing activities” for repayment of the principal and interest of lease liabilities.

299 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

44. SIGNIFICANT CHANGES IN ACCOUNTING POLICIES (CONT’D.)

(a) Adoption of MFRS 16 (cont’d.)

(i) The Group and the Company as lessee (cont’d.)

The reconciliation between the operating lease commitments disclosed applying MFRS 117 at 30 June 2019 to the lease liabilities recognised at 1 July 2019 is as follows:

Group RM’000

Operating lease commitments disclosed as at 30 June 2019 1,033,702 (Less): short-term leases recognised on a straight-line basis as expense (18,036) (Less): low-value leases recognised on a straight-line basis as expense (932) (Less): contracts reassessed as service agreements (294,484) (Less): extension and termination options reasonably certain to be exercised (66,119)

654,131

Discounted using the lessee’s incremental borrowing rate of at the date of initial application 489,875 Add: finance lease liabilities recognised as at 30 June 2019 47,754 Add: contracts reassessed as lease contracts 74,236 Add/(less): adjustments as a result of a different treatment of extension and termination options 341,758

Lease liability recognised as at 1 July 2019 953,623

Of which are: Current lease liabilities 190,844 Non-current lease liabilities 762,779

953,623

(ii) The Group and the Company as lessor

The Group and the Company did not need to make any adjustments to the accounting for assets held as lessor under operating leases as a result of the adoption of MFRS 16.

300 ANNUAL REPORT 2020

Notes to the Financial Statements – 30 June 2020

44. SIGNIFICANT CHANGES IN ACCOUNTING POLICIES (CONT’D.)

(a) Adoption of MFRS 16 (cont’d.)

(iii) Adjustments

The effect arising from the adoption of MFRS 16 on the statement of financial position of the Group and the Company are as follows:

30.6.2019 1.7.2019 Previously Effect of stated MFRS 16 Restated Group RM’000 RM’000 RM’000

As at 1 July 2019

Non-current assets Property, plant and equipment 30,759,493 (642,624) 30,116,869 Right-of-use assets – 1,472,778 1,472,778 Trade and other receivables 1,159,120 15,885 1,175,005

Current assets Trade and other receivables 4,198,733 3,677 4,202,410

Equity Retained earnings 9,488,302 (21,567) 9,466,735 Non-controlling interests 7,631,855 (34,581) 7,597,274

Non-current liabilities Deferred tax liabilities 2,073,144 (5) 2,073,139 Borrowings 11,760,855 (17,489) 11,743,366 Lease liabilities – 762,779 762,779

Current liabilities Borrowings 14,837,243 (30,265) 14,806,978 Lease liabilities – 190,844 190,844

301 YTL CORPORATION BERHAD

Notes to the Financial Statements – 30 June 2020

45. SIGNIFICANT EVENTS DURING AND AFTER REPORTING PERIOD

The outbreak of the COVID-19 pandemic has impacted economic activities worldwide. Many countries have imposed restrictions on non-essential services and business operations, and have also implemented travel restrictions, border closures and other quarantine measures that have significantly curbed the normal movement of goods, services and people. For the financial year ended 30 June 2020, the impact of COVID-19 have been reflected in this set of financial statements.

As the situation is still evolving and will be affected by the degree to which governments are able to contain the spread of the virus in countries where the Group operates, the full impact of the COVID-19 pandemic on the Group’s performance for the financial year ending 30 June 2021 could not be reasonably ascertained when this set of financial statements was authorised for issuance.

The Group and the Company are taking steps to proactively manage the businesses and take the necessary actions to ensure that the long-term business prospects of the Group and the Company remain stable.

46. AUTHORISED FOR ISSUE OF FINANCIAL STATEMENTS

The financial statements have been authorised for issue in accordance with a resolution of the Board of Directors on 30 September 2020.

302 Form of Proxy

[Company No. 198201012898 (92647-H)] CDS Account No. (Incorporated in Malaysia) (only for nominee companies) Number of share held

I/We (full name in block letters)

Tel. No.

NRIC (new & old)/Passport/Company No. of (full address)

being a member of YTL Corporation Berhad hereby appoint

Full name of proxy in block letters NRIC (new & old)/Passport No. of proxy Proportion of shareholdings to be represented No. of shares %

* and/or (delete as appropriate) Full name of proxy in block letters NRIC (new & old)/Passport No. of proxy Proportion of shareholdings to be represented No. of shares %

or failing him/her, the Chairman of the Meeting as my/our proxy(ies) to vote for me/us on my/our behalf at the Thirty-Seventh Annual General Meeting of the Company which will be conducted as a fully virtual meeting through live streaming from the broadcast venue at the Town Hall, 8th Floor, Menara YTL, 205 Jalan Bukit Bintang, 55100 Kuala Lumpur, Wilayah Persekutuan, Malaysia (“Broadcast Venue”) on Tuesday, 1 December 2020 at 1.30 p.m. and at any adjournment thereof.

My/Our proxy is to vote as indicated below:

No. Resolution For Against 1. Re-election of Dato’ Yeoh Seok Kian 2. Re-election of Dato’ Yeoh Soo Min 3. Re-election of Dato’ Yeoh Seok Hong 4. Re-election of Dato’ Cheong Keap Tai 5. Approval of the payment of fees to the Non-Executive Directors 6. Approval of the payment of meeting attendance allowance to the Non-Executive Directors 7. Re-appointment of HLB Ler Lum PLT as Auditors of the Company 8. Approval for Dato’ Cheong Keap Tai to continue in office as Independent Non-Executive Director 9. Proposed authorisation for Directors to allot and issue shares 10. Proposed renewal of share buy-back authority

Please indicate with an “X” in the space provided whether you wish your votes to be cast “for” or “against” the resolution. In the absence of specific direction, your proxy will vote or abstain as he/she thinks fit.

Dated this day of 2020. Signature(s)/Common Seal of Member IMPORTANT NOTICE Pursuant to Section 327(2) of the Companies Act, 2016, the Chairman of the Meeting will be present at the Broadcast Venue, being the main venue of the meeting. Members/proxies/representatives will not be allowed to be physically present at the Broadcast Venue on the day of the meeting. Members are to participate, speak (in the form of real time submission of typed texts) and vote remotely via the Remote Participation and Voting (“RPV”) facilities provided by Tricor Investor & Issuing House Services Sdn Bhd (“Tricor”) on its TIIH Online website at https://tiih.online. Fold this flap for sealing

Notes:- 1. A member (including an Authorised Nominee as defined under the Securities Industry (i) In hardcopy form [applicable for all members] (Central Depositories) Act, 1991 (“SICDA”)) entitled to attend and vote at a general The original Form of Proxy and the power of attorney or other authority, if meeting of the Company may appoint not more than two (2) proxies to participate any, under which it is signed or a notarially certified or office copy of that instead of the member at the Annual General Meeting (“AGM”) via the RPV facilities. power or authority shall be deposited at the office of Tricor at Unit 32-01, 2. Where a member is an Exempt Authorised Nominee as defined under the SICDA, Level 32, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No. 8, which holds ordinary shares in the Company for multiple beneficial owners in one Jalan Kerinchi, 59200 Kuala Lumpur, Malaysia, or alternatively, at its Customer securities account (“Omnibus Account”), there is no limit to the number of proxies Service Centre at Unit G-3, Ground Floor, Vertical Podium, Avenue 3, Bangsar which the Exempt Authorised Nominee may appoint in respect of each Omnibus South, No. 8, Jalan Kerinchi, 59200 Kuala Lumpur, Malaysia. Account it holds. (ii) By Tricor Online System (TIIH Online) [applicable only for members who 3. A proxy may but need not be a member of the Company. Where a member appoints are individuals] more than one (1) proxy, the appointment shall be invalid unless he specifies the The Form of Proxy can be electronically lodged with Tricor via TIIH Online at proportion of his shareholdings to be represented by each proxy. https://tiih.online. Please follow the procedures set out in the Administrative 4. The instrument appointing a proxy shall be in writing under the hand of the appointor Guide. or his attorney duly authorised in writing or, if the appointor is a corporation, either 6. Only members whose names appear on the General Meeting Record of Depositors under its seal or under the hand of an officer or attorney duly authorised in writing. as at 23 November 2020 shall be entitled to attend the AGM via the RPV facilities 5. The appointment of proxy may be made in hardcopy form or by electronic means or appoint proxy(ies) to attend and/or vote in his stead. as specified below and must be received by Tricor not less than 48 hours before 7. For a corporate member who has appointed an authorised representative, please the time appointed for holding the AGM i.e. no later than 29 November 2020 deposit the original certificate of appointment of corporate representative with at 1:30 p.m.: Tricor at either of the addresses stated in note 5(i) above, not less than 48 hours before the time appointed for holding the AGM or adjourned meeting at which the person named in the appointment proposes to vote.

Then fold here

AFFIX STAMP

Tricor Investor & Issuing House Services Sdn Bhd Share Registrar for the 37th Annual General Meeting of YTL Corporation Berhad Unit 32-01, Level 32, Tower A, Vertical Business Suite Avenue 3, Bangsar South, No. 8, Jalan Kerinchi 59200 Kuala Lumpur

1st fold here YTL CORPORATION BERHAD

YTL CORPORATION BERHAD 198201012898 (92647-H)

33rd Floor, Menara YTL 205 Jalan Bukit Bintang Annual Report 55100 Kuala Lumpur Malaysia

Tel • 603 2038 0888 Fax • 603 2038 0388

2020 www.ytl.com www.ytlcommunity.com MAKING A GOOD FUTURE HAPPEN The Journey Continues...

Sustainability Report 2020 CONTENTS

OVERVIEW

01 About This Report 02 Executive Chairman’s Letter to Stakeholders 08 About YTL Group 08 Sustainability Performance 2020 09 Awards and Accolades 10 Our Approach to Sustainability 10 YTL Group Sustainability Framework 11 Sustainability Governance 12 Stakeholder Engagement 13 Materiality

NATURAL CAPITAL

14 Protection of the Environment

HUMAN CAPITAL

50 Empowering Our People

SOCIAL AND RELATIONSHIP CAPITAL

66 Enriching Communities

FINANCIAL CAPITAL

96 Embracing the Marketplace

106 GRI Content Index • Be Part of the Solution

MAKING A GOOD FUTURE HAPPEN The Journey Continues...

reflects our vision for what YTL Group sustainability initiatives aim to achieve internally and externally across the four pillars of YTL Group Sustainability Framework – Environment, People, Community and Marketplace SUSTAINABILITY REPORT 2020 About This Report [GRI 102-1, 102-45, 102-46, 102-50, 102-51, 102-52, 102-53, 102-54]

We are pleased to present YTL Group’s Sustainability Report for Reference and Guidelines 2020. This is our 14th annual sustainability report, providing an This report has been prepared in accordance with the Global Reporting overview of our approach, performance and achievements to create Initiative Standards (GRI) – Core option and the Bursa Malaysia long-term economic, environmental and social (EES) values for our OVERVIEW Securities Berhad (Bursa Malaysia) Main Market Listing Requirements stakeholders. We progressively evaluate and make necessary relating to the Sustainability Statement in Annual Reports. improvements in our approach to sustainability in order to achieve our goals. We endeavour to report issues that are material to YTL Reporting Period Group and our stakeholders, where we create the most value and align with United Nations Sustainable Development Goals (UNSDGs). This report covers YTL Group’s performance from 1 July 2019 to 30 June 2020 (FY2020), unless otherwise stated. This report and our previous reports are available online via PDF and can be downloaded from YTL Group’s corporate website at Capitals www.ytl.com. NAT Our value creation is fundamentally dependant on the forms of capital U available to us (our inputs), how we utilise them (our value-added RAL

Some of our subsidiaries and associated companies have also produced C

activities) as well as our impacts and the value we produce (our APITAL their own reports, available on their official websites listed below, outputs) to the stakeholders. In this report, the capitals are categorised which provide more information about their sustainability policies, as Natural Capital, Human Capital, Social and Relationship Capital and practices, performance, risks and opportunities. Financial Capital.

PT YTL Jawa Timur – www.jawapower.co.id Assurance YTL PowerSeraya Pte Limited1 – www.ytlpowerseraya.com.sg Starhill Global REIT2 – www.starhillglobalreit.com We have not sought external assurance for this report and will HU Wessex Water Limited3 – www.wessexwater.co.uk consider it in future. MAN C Coverage Feedback APITAL

This report covers YTL Group’s significant and active operating units, We welcome your comments, thoughts, and remarks, which can be and those that we have direct operational control over, as reflected directed to: in the holding company’s Annual Report. Unless otherwise stated, YTL Group Sustainability Division the information presented in this report covers our utilities and YTL Corporation Berhad property investment businesses in Malaysia, Singapore, Indonesia, Email: [email protected] SOC IAL AND RELATI Australia, and the United Kingdom (UK), where there is readily available data in place. We also include sustainability initiatives from other business units and some associated companies in greater detail. O N

YTL Group Sustainability Team S HIP C APITAL

Ruth Yeoh Ralph Dixon Nico Aw Issac Liew Elaine Tan Chua Wai Min Rachel Wong Zaiton Hashim Pooja Bansal FINAN Head of Group Director of Senior Manager Manager Executive Executive Executive Office Manager Principal Sustainability Environmental Consultant, C and Director of Investments. YTL-SV Carbon IAL Investments CEO, YTL-SV C Carbon APITA L 1 YTL PowerSeraya Pte Limited’s retail brand, Geneco will be denoted as “Geneco SG” throughout this report 2 YTL Corp owns an effective interest of 36.74% in Starhill Global Real Estate Investment Trust (SGREIT). YTL Starhill Global REIT Management Limited (YSGRM), the manager of SGREIT, is a wholly-owned subsidiary of YTL Corp 3 Wessex Water Limited’s subsidiary, GENeco Limited will be denoted as “GENeco UK” throughout this report

01 YTL GROUP Executive Chairman’s Letter to Stakeholders [GRI 102-14]

TAN SRI DATO’ (DR) FRANCIS YEOH SOCK PING PSM, KBE, CBE, FICE, SIMP, DPMS, DPMP, JMN, JP

Executive Chairman YTL Corporation Berhad

Cash and in-kind donated THE PANDEMIC

for COVID-19 relief Virologists, epidemiologists, and ecologists have warned for too long of the dangers of ~RM126 million coronaviruses again jumping the species bridge from animals to humans. Pandemics and other high-impact events, such as earthquakes, volcanic eruptions, and massive solar flares are a fact of life. It is an abdication of our collective responsibility and a betrayal of our children’s future to move forward in the absence of preparation. Cash donations

The pandemic has been a double-edged sword for the environment, on one hand temporarily Mobile data, SIM cards reducing air borne pollution and improving air quality, but at the same time, resulting in reduced and phones recycling activities with masks and gloves washing up on beaches across the world. The trickle- down impact of the pandemic has yet to be seen in full and we need to prepare for further economic and social shocks as the devastation continues to ravage countries across the globe. Chromebooks YTL Group’s combined donations and relief in cash and in-kind globally amounted to RM126 Food aid and million, including contributions from YTL Foundation which provided free bandwidth and hardware to those hardest hit by the pandemic. YTL Foundation launched the Learn from essential items Home Initiative with FrogAsia and YES 4G, and they facilitated this further by providing free mobile data and SIM cards to students in government schools in Malaysia, and free mobile Rental assistance devices to students from B40 families. We also donated RM1 million to the Government’s COVID-19 Fund in addition to donating mobile phones, Chromebooks and essential items to Face masks, personal frontline health workers at Hospital Sungai Buloh. protective equipment YTL PowerSeraya supported partners by providing energy rebates through its energy retail and ventilators arm Geneco SG. They have provided assistance to their community engagement partner, Comcrop who own and operate the largest rooftop urban farm in the city state.

02 SUSTAINABILITY REPORT 2020

Executive Chairman’s Letter to Stakeholders OVERVIEW

Around one million samples of water are tested annually by Wessex Water’s scientists

Tan Sri Dato’ (Dr) Francis Yeoh presenting a cheque to Prime Minister Tan Sri who have recently been working with the UK Environment Agency laboratories to NAT

Muhyiddin Yassin for the Malaysian Government’s COVID-19 Fund detect the presence of COVID-19 RNA U RAL C APITAL HU MAN C APITAL

Comcrop’s rooftop farm in Woodlands, supported during the pandemic by An employee of YTL PowerSeraya working throughout the Circuit Breaker period Geneco SG in Singapore

Express Rail Link (ERL) and YTL Construction were also busy distributing We also continued to move forward with other carbon mitigation SOC reusable face masks, helping taxi drivers, and donating funds to initiatives across our energy-related business units. Our greenhouse IAL AND RELATI needy families. YTL Power International also contributed RM500,000 gas emissions in these businesses are down 4% from 2015 levels. We to The Edge COVID-19 Equipment Fund. also increased our use of waste as alternative fuels with energy use down 7%, and waste generated falling 23% over the same period. O

To help tenants through the business disruption of the COVID-19 N S pandemic, total rental rebates of SGD32.2 million were provided to During the COVID-19 pandemic, we ensured the full functioning of our HIP C eligible tenants in Starhill Global REIT’s portfolio. various businesses providing essential services including wastewater APITAL treatment, water supply, rail services, cement, communications, and In the wake of the pandemic, most of us are reassessing our power generation in Malaysia, Singapore, Indonesia and the United relationship with the natural environment and looking at the true Kingdom (UK). measure of profit and growth. Despite the sharply reduced numbers

in some of our hospitality and retail properties, we continued in Wessex Water was one of the few utility companies called upon by FINAN earnest working towards our goal to eliminate single use plastics the UK Government in the national Government-led ‘wastewater C from our operations globally by 2025 through our SNAP (Say No to surveillance’ project which is part of an advance warning system to IAL C

All Plastic) campaign. Since 2018 we have managed to save 1.92 detect new outbreaks of coronavirus. Samples are taken at a small APITA million plastic bottles, and 252,000 plastic straws. number of water recycling centres, and these are then analysed by L the UK Environment Agency laboratories to detect the presence of COVID-19 RNA.

03 YTL GROUP

Executive Chairman’s Letter to Stakeholders

PROTECTION OF THE ENVIRONMENT

Methane leaks from oil and gas fields are dangerous and they are akin to oil spills in the sky, and once again the melting of Siberian and other Arctic permafrost, which cover around 25% of the land mass of the northern hemisphere has dominated climate news this summer. NASA scientists have reported that peat fires may be continuing to smoulder underground during the harsh Arctic winters, otherwise known as “zombie fires”, ready to start up again in the spring. So far in 2020, Arctic fires have released 244 million tonnes of carbon dioxide (CO2) into the atmosphere, against 182 million tonnes in 2019, more than the total emissions released by Malaysia in a full year. Melting permafrost releases methane if it is not flared, but when it burns it releases dangerous substances such as carbon Human waste and food waste collected and processed at GENeco UK’s anaerobic digestion facility in Avonmouth, Bristol, UK monoxide (CO), nitrogen oxides (NOx), volatile organic compounds and solid aerosol particles. It is commonly understood that methane has a global warming potential around 28 times that of CO2, but what is less known is that it is 80 times more potent than CO2 over its first two decades in the atmosphere.

YTL Group has taken methane mitigation seriously, and specifically in GENeco UK, a subsidiary of Wessex Water. The UK business unit has been converting both human waste and food waste into biomethane for energy, heating, transportation, and fertiliser for the past eleven years.

Wessex Water treats waste from over three million households, and collects around 48,000 tonnes of food waste (⅔ solids and 1⁄3 liquids), with 11,150,081 m3 of biomethane injected into the UK grid GENeco UK’s Bio-Bee vehicles both collect commercial food waste and run on by Wessex Water, saving around 22,640 tonnes of carbon dioxide biomethane from the same waste equivalent (tCO2e). Wessex Water also achieved additional emission reductions of 1,729 tonnes of CO2e from the export of power from their biogas combined heat and power units. In addition, around 6,000 tonnes of digestate with 28% of dry solids were produced, with almost 35% being used as fertiliser in nearby farms, reducing the use of nitrates and other harmful chemicals.

Our transportation arm, Express Rail Link which operates the KLIA Ekspres from the city to the airport, continues to take between four and five million cars off the road from KL Sentral to KLIA yearly, and has reduced around 140,000 tonnes of CO2e since 2014, equivalent to the emissions generated by around 10,000 Malaysian households annually.

Following the success of the waste heat recovery (WHR) unit in YTL Cement’s Dama Plant in China, YTL Cement extended the WHR initiative to their plant in Perak-Hanjoong Simen, the first in Malaysia, Express Rail Link achieved a commendable milestone hitting their 100 millionth saving a significant amount of energy and energy-related emissions. passenger

04 SUSTAINABILITY REPORT 2020

Executive Chairman’s Letter to Stakeholders

Number of renewable energy units installed and emissions reduced in Indonesia by YTL Jawa Timur OVERVIEW 800 12,000

700 10,000 600 8,000 500

400 6,000

300 4,000 200 NAT U Units installed (cumulative) per year Emissions reduced

2,000 RAL 100 C 0 0 APITAL FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020

Number of micro hydro units installed (cumulative) Number of units solar installed (cumulative) Number of domestic biogas units installed (cumulative) Emission reduced per year (tCO2e) HU

ELEVATION OF ENERGY POVERTY AND COMMUNITIES MAN C

In the last decade, global energy poverty has fallen from almost 1.5 billion people in 2009 to less than 1 billion in 2018. However, the APITAL Sustainable Development Goal target of universal access by 2030 will unlikely be met, with an estimated 500 million still predicted to lack access to energy by 2030.

The falling cost of solar and other renewable energy sources has helped the development of mini-grids for off-grid communities and had a positive impact on the health of communities and the environment by reducing the use of kerosene and diesel as fuel for cooking and energy SOC respectively. IAL AND RELATI

YTL Group, since 2012 has continued to extend the reach of the rural renewable energy programme in Indonesia and East Malaysia, with 817 units of biogas (680), micro hydro (39) and solar (98) positively impacting the lives of more than 7,000 people, and reducing emissions

exceeding 53,000 tonnes of CO2e. O N S HIP

Through YTL Foundation and other business units, we have helped over 75,000 children in learning and education. YTL Group as a whole C APITAL has spent RM16.5 million on local community investments benefitting over 112,000 people in need and those supported by charities. FINAN C IAL C APITA

A villager using biogas for cooking, from a dome YTL Jawa Timur provides access to clean water to Villagers from Kampung Sion, Sarawak provided with L installed by YTL Jawa Timur communities located in remote areas solar energy units reducing their financial burden

05 YTL GROUP

Executive Chairman’s Letter to Stakeholders

BIODIVERSITY AND CONSERVATION

As with previous letters to stakeholders that I have penned, global biodiversity loss has consistently been a serious concern for YTL Group. However, as it intensifies with a sixth major extinction event resulting from human activity and climate change looming, the onus is on humans to try and prevent as many of them as possible. The loss of species can be stopped if there is a genuine will to do so. However, it requires collective action on a grand scale considering the extent and seriousness of the issue. We all need to act to support An endemic species, the Kanthan Trapdoor Spider in Gunung Kanthan has been conservation and prevent extinctions. preserved

YTL Cement and Malayan Cement Berhad have continued to invest in conservation and biodiversity initiatives. These include preserving endemic species of flora and fauna in the limestone reserve of Gunung Kanthan and other karst outcrops. The emphasis in production of manufactured sand, and the use of waste in alternative fuels, aggregates, and the generation of energy all support conservation efforts in our cement business.

In Wessex Water’s region, we have focused on funding biodiversity conservation in waterways and in the surrounding air with an emphasis on beavers, birds, and other wildlife native to the areas.

Images of Wessex Water’s Biodiversity Action Plan (BAP) Partners Programme Likewise, in and around the Paiton power plant area operated by activities and animal sightings YTL Jawa Timur, the health of marine ecosystems near the power plant outlet cooling canal and along the coast are monitored and reefs have been rehabilitated. We have planted 112,300 mangroves, 58,910 sea pines and 5,431 other mixed tree species. To promote healthy marine ecosystems near the plant, 1,968 reef blocks have been laid on the reef using mainly fly ash and bottom ash (FABA) waste from the power plant itself mixed with cement.

For over ten years, YTL Hotels has been supporting the rehabilitation of coral reefs, turtle rescue and turtle egg hatching sites with a cumulative 55,548 eggs saved from human consumption and 40,600 hatchlings released into the wild. YTL Hotels has also supported Save Mangroves planted at Randutatah Conservation Area improve local biodiversity Wild Tigers since 2014 and continues to help raise funds for anti- and rehabilitate the natural environment poaching activities, advocacy and awareness. The most recent of many events supported by YTL Hotels was a photographic exhibition in the Raffles Hotel, Singapore in late 2019, with a selection of the original photo exhibits from the Royal Albert Hall London exhibition from the previous year, featuring almost 100 images of tigers in the wild by over 30 of the world’s leading professional wildlife photographers. This follows a major fundraising event in the past – the Save Wild Tigers Gala Dinner hosted by The Majestic Hotel Kuala Lumpur in 2014 which raised over RM1.7 million to fight poaching of wild tigers in Malaysia.

An adult turtle spotted on the beach at YTL Hotels’ Tanjong Jara Resort near the Visitor's Hut and the turtle hatchery

06 SUSTAINABILITY REPORT 2020

Executive Chairman’s Letter to Stakeholders

CONCLUSION

Apart from disease, we face three main existential threats which need to be dealt with collectively – climate change, inequality, and the use OVERVIEW of natural resources. Whilst climate change may not be impacting all of us directly now, we need to thoroughly assess risks and prepare for change. For example, banks in the United States have already started evaluating mortgage applications based on climate change risks as data shows an extraordinary rise in coastal flooding, and the risks are intensifying. As such, YTL Group has been advocating and Charopa lafargei, a tiny but important endemic species of snail measuring just carrying out climate change action and mitigation measures for the 2-3mm in diameter found in Gunung Kanthan has also been preserved last 30 years by building and progressing sustainably since our humble beginnings in 1955. NAT U Our ability to impact climate change in the short term is limited as RAL

greenhouse gas emissions do not cause a sudden rise in global C APITAL temperatures and neither does cutting them result in instantaneous

cooling. However, air borne particulates, and NOx levels are critical, and we now know that air quality has a strong bearing on premature death, and immune response to infection by viruses. Similarly, air pollution and preterm birth are well linked, and it is not only industrial and transportation linked air pollution, but also from particles in wildfires and gas flaring. HU MAN The COVID-19 pandemic has also given rise to significant soul searching C

both in business and at home, and the issues of integrity and purpose APITAL in business have risen to the fore. As testament to our improving levels of disclosure and reporting, YTL Corporation Berhad has been part of the FTSE4Good Bursa Malaysia Index every year since 2017. We have prioritised ethical business with 100% of our employees in Malaysia completing the Anti-Bribery and Corruption training course, SOC reflecting our commitment to zero tolerance for bribery and corruption. IAL AND RELATI We have also dug into our conscience and the definition of our purpose which is echoed in the words of prominent Greek statesmen, Pericles (circa 450 BC), who said that “what you leave behind is not what is engraved in stone monuments, but what is woven into the O lives of others”. May God continue to guide us on our journey to N S

YTL Jawa Timur’s paving block production programme HIP Making a Good Future Happen. using FABA waste C APITAL FINAN C IAL C

Pericles (l. 495–429 BCE) – prominent Greek statesman, APITA orator, and general during the Golden Age of Athens L Annual Reef Check surveys are conducted by Reef Check Malaysia’s TAN SRI DATO’ (DR) FRANCIS YEOH SOCK PING team to assess the health of the coral reefs and monitor the PSM, KBE, CBE, FICE, SIMP, DPMS, DPMP, JMN, JP success rates of nubbins on the reef blocks Executive Chairman YTL Corporation Berhad 07 YTL GROUP About YTL Group [GRI 102-10, 102-12, 102-13, 201-1]

YTL Group is an integrated infrastructure developer with extensive operations in countries including Malaysia, the United Kingdom, Singapore, Indonesia, Australia, Japan, Jordan and China. The core businesses of YTL Group comprise utilities, construction, cement manufacturing and trading, property investment and development, hotel operations, information technology and e-commerce related business as well as management services and others.

Corporate Facts at A Glance SUSTAINABILITY PERFORMANCE 2020

NATURAL CAPITAL

Change in Change in Change in Change in Elimination More than Operating in CO2 energy waste water of single 13,000 more than emissions consumption generation recycled use plastic employees 10 countries 2015-2020a,b,d 2015-2020a,b,c,d 2015-2020a,b,c 2015-2020a,b 1 million globally across 3 4% 7% 23% 38% pieces continents Note: a YTL Jawa Timur b YTL PowerSeraya c Starhill Global REIT d Wessex Water

HUMAN CAPITAL Constituent of

32% Zero 100% Zero Serving more Females in incidents on of employees in fatalities Bursa than leadership discrimination, Malaysia completed Malaysia 15 million role and forced the ABC Policy Index customers or child labour training since 2017

SOCIAL AND RELATIONSHIP CAPITAL

Membership in Associations

Member Cash and Engaged over Local Employee Benefitting 1. Malaysian Dutch Business Council in-kind 75,000 community volunteer more than 2. Malaysian Employers Federation donated for children in investments hours 112,000 3. Malaysian-German Chamber of COVID-19 relief learning and ~RM16.5 3,530 people in need, Commerce and Industry ~RM126 education million groups and 4. Global Compact Network million charities Singapore 5. Sustainable Energy Association of Singapore FINANCIAL CAPITAL 6. World Cement Association 7. VGB PowerTech e.V. 8. British Water Revenue Zero RM17.8 92% Signatory RM19.2 tolerance for billion of total billion bribery and combined market procument spent 9. Paris Pledge for Action 6% corruption capitalisation on local vendors 10. United Nations Global Compact versus FY2019 (as at 30 June 2020)

08 SUSTAINABILITY REPORT 2020

About YTL Group

AWARDS AND ACCOLADES

YTL Land & Development's Express Rail Link (ERL) won 3 Orchard By-The-Park on “Partnership of the Year” OVERVIEW Orchard Boulevard, Singapore award at the prestigious won six awards at The Global AirRail Awards EdgeProp Singapore 2019 in Vienna, Austria for Excellence Awards 2019 its efforts in expanding its for the following categories sales platform and customer –Design Excellence Award base worldwide. This is their (Developer and Architect), People’s Choice Award, Top Boutique 11th time winning a Global Development Award, Top Development Award and Top Luxury AirRail Award since its

Development Award. These awards set out to recognise the inception in 2011. ERL was also previously named AirRail Link NAT

best property players and developments in Singapore of the Year in 2012, 2014, 2015 and 2016 U RAL C APITAL HU MAN

Wessex Water was a recipient of South West Area Innovation C APITAL Awards 2020 and clinched second place in the 2020 National Innovation Awards from the UK Institute of Water for its YTL Communications was awarded the Connectivity - innovation ‘3D LiDAR Modelling of Tunnels in Semi-turbulent Telecommunications trophy at the inaugural Malaysia Flow’. This is their fifth time winning the Innovation Awards Technology Excellence Awards 2019 for their effort to build since 2013 the first large-scale Terragraph trial network in Asia SOC

YTL PowerSeraya attained bizSAFE Level Star, IAL AND RELATI the highest level under the bizSAFE programme administered by the Singapore Workplace Safety and Health (WSH) Council for its WSH achievements O N S HIP

YTL Jawa Timur was C APITAL awarded PROPER Green Rating by Ministry of Starhill Global REIT won the Wessex Water’s Engineering and Environment and Forestry Silver award in the category Sustainable Delivery Department (Indonesia) in January 2020 for retail REITs in Singapore has received the Commended for their outstanding during The Asia Pacific Best Sector Award at the RoSPA FINAN performance in energy of the Breeds REITs Health and Safety Awards

efficiency, environment C Awards™ 2019 which 2020 for its proactive health and IAL

management system, air recognises companies and safety management systems, C APITA emissions, hazardous and non-hazardous waste management, managers with the highest company culture and overall

water usage efficiency and water pollution reduction, biodiversity standards and performance in performance. This is the fourth L and CSR. This is their 14th time winning since 2006, including the Asia Pacific REITs sector time in five years winning the two gold ratings for the years 2013 and 2016 Industry Sector Award

09 YTL GROUP Our Approach to Sustainability [GRI 102-11, 102-16, 102-18, 102-40, 102-42, 102-43, 102-44, 102-47, 102-49]

MAKING A GOOD FUTURE HAPPEN

Our commitment to sustainability is embedded in all aspects of our business in line with our strategy and four main pillars of Environment, People, Community and Marketplace. YTL Group has a strong track record of building impactful businesses and striving to overcome challenges that exist in the current global context. Founded on the ethos of “Building The Right Thing” (BTRT), YTL Group is committed to consistently reinforce our creative thinking and innovative approach so that we can continue in Making a Good Future Happen.

Our sustainability strategy remains focused on the four pillars as outlined in our Sustainability Framework, and aligned with the United Nations Sustainable Development Goals (SDGs), YTL Group Corporate Statements (Human Rights and Ethics, Environment, Health and Safety, and Commitment to Ethical Purchasing), Code of Conduct and Business Ethics (The Code), as well as Anti-Bribery and Corruption Policy (ABC Policy)4. There was a change to our selection of the 17 SDGs, and we have now divided these into core and peripheral. This year, we made adjustments to align with our Group-wide initiatives to the SDGs to eliminate any overlap.

YTL Group Sustainability Framework

Brand Values MORAL Building the HONESTY HARD WORK TOGETHERNESS VITALITY RESPONSIBILITY right thing

Sustainability Commitment Making a good future happen PROTECTION OF THE EMPOWERING ENRICHING EMBRACING THE ENVIRONMENT OUR PEOPLE COMMUNITIES MARKETPLACE

Aligned to Sustainable Development Goals

Core

Peripheral

4 Please view our Corporate Statements at www.ytl.com/sustainability/corporatestatement.asp, the Code and ABC Policy at www.ytl.com/governance.asp

10 SUSTAINABILITY REPORT 2020

Our Approach to Sustainability

SUSTAINABILITY GOVERNANCE

Good governance begins with integrity and ethics at the paramount of an organisation, namely the Board of Directors (the Board). We are commited to achieve our business objectives to deliver sustainable value to stakeholders. As such, we have established a set of well-defined OVERVIEW policies and processes to enhance corporate performance and accountability. These are supported by our strict conformance to respective laws, rules, regulations and international standards.

To further our sustainability agenda in an inclusive and integrated manner, our formal set of guidelines – the Sustainability Framework - lays down a strong foundation for our current and future roadmap to achieve our sustainability objectives in a holistic manner. It also directs our sustainability practices towards the achievement of our triple bottom line objectives. YTL Group Sustainability Committee (YTL GSC) chaired by the Executive Chairman, Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, for the implementation and monitoring of our sustainability agenda. YTL Group Sustainability Division is spearheaded by the Head of Group Sustainability and assisted by business units and group functional support divisions worldwide. An overview of the sustainability governance structure has been listed below. We regularly engage with our NAT

stakeholders to understand their perception of economic, environmental and social (EES) aspects related to our business. U RAL C YTL Group Corporate Governance Principles YTL Group Sustainability Governance Structure APITAL

BOARD OF DIRECTORS

Annual reporting

Review and adopt Oversee the conduct of EXECUTIVE CHAIRMAN HU strategic plans for YTL Group’s business MAN

YTL Group operations against C APITAL

EES performance Bi-annual reporting Ongoing

YTL GROUP GROUP SUSTAINABILITY Ongoing SUSTAINABILITY COMMITTEE DIVISION SOC (YTL GSC) IAL AND RELATI

Succession Identify principal risks Quarterly reporting affecting YTL Group planning

businesses and maintain a O N S

sound system of internal SUSTAINABILITY HIP

control and mitigation CHAMPIONS C APITAL measures

Quarterly reporting FINAN BUSINESS

UNITS/ C IAL Oversee the development Review the adequacy and GROUP C and implementation of integrity of YTL Group FUNCTIONAL APITA stakeholders management information SUPPORT L communication policies and internal control DIVISION systems

11 YTL GROUP

Our Approach to Sustainability

STAKEHOLDER ENGAGEMENT

Stakeholder engagement is a mechanism through which we identify potential sustainability challenges, risks and opportunities. Each stakeholder group was engaged through different communication channels fit for each group in order to elicit feedback which management evaluates and actively responds to in a balanced and respectful manner. The stakeholder engagement process focuses on identification and prioritisation of material issues and the periodic review of actions taken to deal with concerns. The following table covers a list of key stakeholder groups, various methods of engagement, matters discussed, and how we respond.

Stakeholder Modes of Frequency Matters Discussed by Our Groups Engagement Stakeholder Strategy

• Intranet, newsletters and Annually, • Corporate vision, core values and ethical • Opportunity for career development broadcasts Quarterly, conduct • Employee benefits and medical coverage • Town halls and Leadership Ongoing • Business strategy and direction • BTRT and Monday Memo Conference • Reward and recognition • Women at YTL (W@Y) • Trainings • Leadership and talent development • YTL Sustainathon • Annual performance appraisal • Welfare and benefits • YTL LEAD Conference Employees • Recreational and team-building • Human rights, diversity and inclusion • Peer-to-peer sharing session sessions • Workplace health and safety • The Code, Corporate Statements, ABC Policy

• Website and social media Ongoing • Product and service quality • Global Privacy Policy • Marketing and promotional • Competitive pricing • Innovative product programmes and events • Customer experience • Reliable customer service • Feedback channels such as • Safety and security • Appreciation events emails, phone calls, hotlines and Customers surveys • Product launches and roadshows

• Annual General Meetings Annually, • Economic performance • Appreciation events • Investor relations events Quarterly, • Company growth and value chain • Supply chain seminars • Annual reports Ongoing • Business strategy and direction • FTSE4Good Bursa Malaysia Index • Analyst briefings • Financial results • Consistent profit generation Shareholders • Website updates • Malaysian Code on Corporate and Investors Governance 2017 • ABC Policy

• Regular meetings and site visits Ongoing • Sharing best practices • Increased compliance audits • Product launches and • Compliance with rules and regulations • Appreciation events roadshows • Health and safety excellence • Supply chain seminars Suppliers, • Supplier briefings and trainings • Fair treatment of suppliers and business • The Code, Corporate Statements and Business • Supplier assessment system partners ABC Policy Partners and • Workshops and networking • Ethical and responsible conduct Industry Groups functions • Opportunities for business collaboration

• Official meetings and visits Ongoing • Compliance with rules and regulations • Public-Private Partnership • Industry dialogues, events and • Opportunities for business investment • Foreign investment Government seminars • Community investment and Regulators

• Press releases Ongoing • Economic performance • Regular media engagements • Official launches and corporate • Company growth and value chain • Announcement of Quarterly Financial events • Business strategy and direction Results • Media coverage • New projects and future prospects Media • Website and social media

• Community outreach Ongoing • Minimising environment and social • Corporate donations programmes impacts • Corporate social responsibilities • Charitable contributions • Community investments including • Support local SMEs • Website and social media donations, fundraising and volunteering Communities programmes • Project-based initiatives

12 SUSTAINABILITY REPORT 2020

Our Approach to Sustainability

MATERIALITY

YTL Group has prepared this report in accordance with the AA1000 AccountAbility Principles of Inclusivity and Materiality and the Principles for Defining Report Content of GRI Standards, consisting of Stakeholder Inclusiveness, Sustainability Context, Materiality, and Completeness. OVERVIEW

To ensure the continued relevance of our material issues, we conduct a formal materiality assessment biennially. Following our last review in 2017, we conducted a new materiality review this year. With guidance provided by an independent third-party consultant, the sustainability team works with YTL GSC and relevant business units to identify and review potential ESG issues, based on the previous findings, internal policies, stakeholder expectations, peer benchmarking, media research and regulatory frameworks.

A six-point Likert scale was used and respondents were asked to rank priorities based on the actual and potential impacts of issues affecting business continuity and development. The final list of material issues is reviewed and approved by the Board. Based on the assessment, the materiality matrix generated a total of 24 material sustainability matters, of which eleven were ranked as highly material. NAT U RAL

Materiality Assessment Process C APITAL

STEP 1 STEP 2 STEP 3 STEP 4 Identification of Analysis and Validation and Board ESG issues prioritisation of findings review sign-off HU MAN YTL Group Materiality Matrix C APITAL

High Highly Material Material

1 Ethical business and compliance 12 Employee benefits

2 Anti-bribery and corruption 13 Employee engagement SOC

3 Governance and transparency 14 Sustainable supply chain IAL AND RELATI

1 4 Financial sustainability 15 Training and education 2 3 5 Risk management 16 Climate and energy

6 Customer privacy 17 Education O 8 4 N S 10 6 5 7 Customer satisfaction 18 Waste management HIP 12 9

11 7 C 13 8 Product and services 19 Air emissions APITAL 14 15 16 18 17 9 Scheduled waste disposal 20 Local community YTL Group’s Ability to Impact 19 20 10 Health and safety 21 Innovation and technology 21 22 23 11 Diversity and anti-discrimination 22 Biodiversity

24 23 Water efficiency FINAN

24 Arts and culture C

LowImportance to YTL Group High IAL C APITA L

13 PROTECTION OF THE ENVIRONMENT

Our Our Commitment Approach

Integrating responsible and sustainable environmental • Protecting and conserving terrestrial and marine biodiversity strategies into our core business decisions to protect and and ecosystems enrich the natural environment for future generations • Reducing greenhouse gas emissions through energy efficiency and renewable energy towards a low carbon economy • Managing waste streams including responsible disposal, harnessing waste to energy, anaerobic digestion and the 5Rs – Refuse, Reduce, Reuse, Repurpose and Recycle whilst optimising resource efficiency towards a circular economy • Prioritising sustainable water use and efficiency • Using sustainable materials and minimising negative impacts on the environment in manufacturing, construction and property development Aligned To YTL GROUP Protection of the Environment [GRI 103, 302-1, 302-2, 302-4, 303-3, 303-5, 304-1, 304-2, 304-3, 304-4, 305-1, 305-2, 305-3, 305-4, 305-5, 305-7, 306-1, 306-2, 306-3, 306-4, 307-1]

As a responsible conglomerate, we place a strong focus on sustainable PERFORMANCE HIGHLIGHTS development and our role as a steward of nature where we operate. Protection of the environment is engrained in our culture and value Biodiversity system through commitments spelled out in our Corporate Statement on Environment, and Code of Conduct and Business Ethics – Responsible • 13,262 turtle eggs saved from 140 nests in Tanjong Corporate Citizen. Both are made available and easily accessible on Jara Resort (TJR) our corporate website5. • 5,923 coral nubbins/colonies transplanted in Gaya Island Resort Marine Centre (GIRMC), Pangkor Laut Resort Adopting the United Nations Global Compact (UNGC) principles of (PLR) and YTL Jawa Timur (YTLJT) along with 1,815 fly environment, we are committed to the highest environmental standards ash and bottom ash (FABA) blocks deployed in YTLJT, and to improve our environmental performance and to minimise 153 cement blocks used in GIRMC. environmental impacts of our operations. Many of these are directly measurable and represent the environmental footprint of YTL Group. As such, we have put in place environmental policy and strategy, Environmental Compliance whilst reduction targets are set by respective business units, with • compliance with the local water discharge quality particular focus on biodiversity conservation, climate change and 100% and air emission standards energy, as well as waste and water management. • Zero chemical and oil spills Our collective efforts in environmental conservation have resulted in a growing portfolio of green investments, environmental technologies, greenhouse gas (GHG) emission reduction measures, resource efficiency Climate Change and biodiversity conservation programmes across YTL Group. We • 4% reduction in CO2 emissionsa,b,d strive to be one of the driving forces in environmental protection through engaging with experts and sharing of best practices with • 176,641 trees planted across YTL Group with our stakeholders. 185,550 kg carbon dioxide (CO2) sequestered

Energy Efficiency and Renewable Energy

• 4% fall in energy consumptionsa,b,c,d

• 1381 kWp solar photovoltaic panels installed

Waste Management and Resource Efficiency

• 8% fall in waste generationa,b,c

• 1,011,072 pieces of single use plastic eliminated

Water Stewardship

• 2% reduction in water consumptiona,b,c

Wessex Water’s river restoration work has built on the wealth of nature and • 6% increase in recycled watera,b biodiversity in the region

Note: a YTL Jawa Timur b YTL PowerSeraya c Starhill Global REIT d Wessex Water

5 Please view our Corporate Statements at www.ytl.com/sustainability/corporatestatement.asp and Code of Conduct and Business Ethics at www.ytl.com/governance.asp

16 SUSTAINABILITY REPORT 2020

Protection of the Environment

BIODIVERSITY

OUR GOAL: O To conserve biodiversity on land and below water VERVIEW

The conservation of biodiversity is a concern for all humankind, and as we contend with the impacts of the COVID-19 pandemic, the threat to biodiversity loss and extinction has not receded. The number of species at risk of extinction continues to rise as mankind encroaches on the natural environment, depletes vital habitats and destroys ecosystems. As we seek to rebuild from the global pandemic, YTL Group has embarked on various initiatives in preserving and conserving terrestrial and marine ecosystems, in line with SDG 14 – Life Below Water, SDG 15 – Life On Land and SDG 17 – Partnerships For The Goals. NATURAL CAPITAL Biodiversity Screening and Monitoring

Biodiversity screening is a necessity in the initial stage of construction and operational activities for YTL Group, in order to address the scarcity of finite resources and potential biodiversity loss to meet regulatory compliance requirements. Through assessment, species inventory or baseline information can be determined prior to project planning. Subsequently, monitoring work can take place in the later phase of the project activities, which involves continuous scrutinisation in tracking anticipated impacts caused by the operations or activities, followed by proper improvements to minimise associated risks.

Indonesia HU Preserving Biodiversity in Close Proximity to the Power Plant MAN

• YTLJT is equipped with an online system to monitor and ensure C APITAL all water from the power station falls within local standards prior to discharge • Monthly on-site water sampling and testing by appointed third- party environmental authority and independent laboratory • Perform quarterly marine biota and coral reef surveys Regular monitoring and surveys are performed at Randutatah Conservation Area SOC

Outcome: IAL AND RELATI

• 100% regulatory compliance achieved, seeing marine life such as plankton, fish and coral reefs flourishing over the past 19 years

of operations O N S HIP United Kingdom C APITAL

Investigating, Assessing and Executing Wildlife and Conservation:

• Wessex Water’s potential impact on the environment, wildlife, archaeology and geology as well as the presence of any protected

or rare species FINAN • Sniffer dog used to support terrestrial great crested newt surveys C IAL

Outcome: C APITA

• 93% Site of Special Scientific Interest (SSSI) designated L landholdings in favourable or recovering status • 100% of the eligible landholdings assessed for biodiversity value Freyah the Springer Spaniel, has been brought up to help Wessex Water to sniff by 2020, covering 2,160 hectares of eligible land on the Great Crested Newts during maintenance works

17 YTL GROUP

Protection of the Environment

Restoration and Protection of Conservation of Life On Land and Below Water – Initiatives across YTL Group Life On Land and Below Water Tree Trimmings for Kanthan Biodiversity Initiatives Biodiversity Action Plan Life on Earth is highly complex and Elephants Associated Pan Malaysia Cement (APMC) (BAP) Partners Programme interdependent. The ecological The Surin Phuket (TSP) Wessex Water services provided by all living • Kanthan Hill or Gunung Kanthan is host • Tree branches from the to various endangered species • GBP350,000 invested for organisms inhabiting land and gardens were fed to the • Five initiatives were specially curated to four key nature conservation water supply both tangible elephants twice a month protect the rare flora and fauna species. projects over the last five resources (food, pest control, water More details can be found on page 20 years. More details can be purification, etc.) and intangible found on page 22 benefits (tourism and aesthetic value) to communities. We have long supported conservation efforts through non-governmental organisations (NGOs) in meeting our aim to safeguard and restore life on land and below water against numerous threats. Through partnerships, we can address issues that we may not have the expertise, skills or resources to manage on our own.

Coral Reef Restoration Gaya Island Resort Marine Centre (GIRMC) • Transplanted 1,735 coral nubbins onto 153 cement blocks, with 78.9% survival rate

Pangkor Laut Resort (PLR) X Reef Check Malaysia • At Mentagor Island: 734 coral colonies transplanted with 67.3% survival rate • At PLR Jetty: 39 colonies transplanted with 43.9% survival rate

YTL Jawa Timur (YTLJT) X Bhinor Underwater Community X Universitas Islam Negeri Sunan Ampel Surabaya (UNISA) • 3,415 coral nubbins deployed with 1,815 paving blocks, recorded average survival rate of 82.7%

18 OVERVIEW NATURAL CAPITAL HUMAN CAPITAL SOCIAL AND RELATIONSHIP CAPITAL FINANCIAL CAPITAL 19 2020 ) 2

and SUSTAINABILITY REPORT REPORT SUSTAINABILITY (Buceros bicornis) protection – – long-term Study of flying fox species to secure site roosting – safe their population Quarterly data collection to obtain – Provide – fox conservation Spread awareness on flying diversity of the natural environment near Bermi Village. diversity of the natural environment near Bermi More details can be found on page 24 YTL Jawa Timur (YTLJT) Greenery Programme Conservation Randutatah Mangrove and Sea Pines Area • Project in: Partnership in Special Pteropus Eyes on Flying Foxes Eyes on Flying Foxes (PLR) X RIMBA Pangkor Laut Resort • 175,042 trees planted, stretching along 55 km of coastline Bermi Eco Park • 1,599 trees planted in an area of five hectares, improving with 75% success rate an approximate area of 20,000 square feet (ft Enriching the Mangrove Forest Gaya Island Resort (GIR) • mangrove saplings sowed and flourished into shrubs, 3,000 • In January 2020, additional 500 seedlings propagated, covering (Anthracoceros albirostris) GIRMC the beach Saving Turtles Gaya Island Resort Marine Centre (GIRMC) • 19 turtles rescued, nine released and two injured turtles under rehabilitation by Tanjong Jara Resort (TJR) X Lang Tengah Turtle Watch (LTTW) • 13,262 eggs saved from 140 nests • with 74% success rate 9,762 hatchlings released Spa Village Resort Tembok Bali • that were not capable of swimming in strong waves at Rescued turtle hatchlings Oriental Pied Hornbill the success in breeding four juvenile hornbills the success in breeding sp. • to boxes made from recycled wood, contributed Several wooden nesting • The Great Hornbill Two unique hornbill species: Preserve Our National Bird – Hornbill Preserve Our National (PLR) Pangkor Laut Resort Enhalus sp., known to be the main diet for Cymodocea species in and around GIR species in and around to their naturalbefore release them back habitat: pangolin lizard – Sunda monitor macaque – Water tailed – Long python – Reticulated the green sea turtle for seagrass propagation and Gaya for on-site planting • Naturalist at GIR collected seagrasses from Kampung • Ongoing studies conducted to find the optimal way Reviving Seagrass Habitat Gaya Island Resort (GIR) Protection of the Environment of the Protection Safeguard Landed Species Safeguard Landed Wildlife Centre Gaya Island Resort (GIRWC) • • Identified ten new flora and 446 fauna • out to treat wildlife Rescue work carried • Currently, GIR focuses on two species: YTL GROUP

Protection of the Environment

Associated Pan Malaysia Cement (APMC) – Kanthan Biodiversity Initiatives

Malaysia

As a leader in the Malaysian cement industry, YTL Cement continues to play its role in the conservation of biodiversity by developing rehabilitation plans at the APMC Kanthan Quarry site, Chemor, Perak in order to foster long-term wildlife habitat creation as well as the conservation of endangered species as their ultimate goal.

Area D where the famous Kanthan Cave is situated, located next to the APMC Kanthan Quarry has been declared as a part of Kinta Valley Geopark, a National Geopark in October 2018, hosting various endangered species of flora and fauna. Currently, there are five ongoing biodiversity projects, each specially curated to protect and conserve a significant species listed on the International Union for Conservation of Nature (IUCN) Red List and Malaysia Red List.

Liphistius kanthan (Trapdoor Spider) Plant Recce and Translocation Project Land Snail Translocation Project Population Study

With guidance from Tropical Rainforest Conservation The Elephant snail, Pollicaria elephas is known to have Liphistius kanthan is currently listed by IUCN as a and Research Centre (TRCRC), APMC has built an in- the largest living population in the northern part of critically endangered species inhabiting Kanthan Cave. house plant nursery. Kanthan Hills. Extensive microclimate and snail diet New research will be carried out to study the population analysis have been carried out. of this rare cave dweller. Outcome • Up to 10,000 saplings can be accommodated in Outcome Expected outcome the nursery • To survey and select suitable living conditions that • Identification of the spider species through DNA • Currently, 14 species of Kanthan endemic species mimic the original microhabitat conditions of this analysis have been nurtured rare endemic species to ensure their long-term • To ensure the sustenance of the spider population • Most of the locally endangered species were survival following the translocation collected during the plant and seed recce and germinated in the nursery to be replanted at designated rehabilitation sites

Understanding the important role bats play in controlling agricultural pests and pollinating crops, bat diversity and cave structure study was scheduled to be performed. However, the study has yet to commence due to the COVID-19 pandemic. IUCN has also recommended the suspension of all fieldwork that involves interaction with bats.

Outcome • Characterisation of cave structure and determination Jasa Megah Rehabilitation Project of ideal roosting sites favoured by different bat species A four-acre pilot plot was set up for rehabilitation. • Identification of the species of bats inhabiting the Palm oil waste was used to create humus and to store cave water for reclamation work at Jasa Megah. Pioneer • Sustained biotic and abiotic parameters that and fast-growing trees were planted to repair the soil contribute to the cave’s health condition of the heavily disturbed area.

Outcome • Trees successfully planted using humus created from palm oil waste • The reclamation activities attract wild animals to inhabit Bat Diversity and Cave Structure Study

20 OVERVIEW NATURAL CAPITAL HUMAN CAPITAL SOCIAL AND RELATIONSHIP CAPITAL FINANCIAL CAPITAL 21 2020 tainable SUSTAINABILITY REPORT REPORT SUSTAINABILITY Kinta Valley region Shared technical knowledge in constructing an in-house nursery which started operating in May 2018 Transported 16 individual land snails from Area A to Area D for translocation studyTransported 16 individual land snails from Area A to growth monitoring study and eleven juveniles into two plots in the nursery for APMC X TRCRC APMC X University Malaysia Sabah X RIMBA Phase 1 Study Impact • snail species identified from 13 limestone outcrops throughout the 122 land Phase 2 Study Impact • Impact • • Assisted the Kanthan Plant’s employees during seed and wildling collection • Contributed to developing the daily nursery works SOPs , APMC has been collaborating with a number of organisations for with a number of organisations , APMC has been collaborating Partnerships For The Goals Partnerships For The IUCN Red List and 99 listed on Malaysia Red List and fauna through a series of comprehensive biodiversity surveys in 2014 and fauna through a series of comprehensive biodiversity APMC X FRIM Flora Survey APMC X University Malaya, Institute of Biological Science APMC X University Malaya, Institute of Biological Impact Helped identify the species of plants and discovered several plant species such as: kanthanensis • Vatica kanthanensis • Meiogyne kanthanense • Gymnostachyum • with 22 species listed on Identified more than 384 species of flora and fauna • inventory for flora Helped develop the foundation of Kanthan’s biodiversity Impact their environmental conservation journey in order to strengthen the means of implementation in environmental protection and sus the means of implementation in environmental journey in order to strengthen their environmental conservation transfer of environmentally sound technologies. knowledge sharing, capacity building and development through Conservation through Collaboration Conservation through to SDG 17 – In line with its commitment Protection of the Environment of the Protection YTL GROUP

Protection of the Environment

Wessex Water - Biodiversity Action Plan (BAP) Partners Programme

United Kingdom

Wessex Water is currently in the sixth phase of its Biodiversity Action Plan (BAP) Partners Programme, which provides funding to projects carried out by wildlife organisations. Running since 1998, the programme has achieved some notable conservation successes, made an innovative and valuable contribution to safeguarding natural resources and biological diversity and has helped to contribute to the company’s goal of conserving and enhancing wildlife in the region.

Wessex Water’s BAP Partners Programme has supported four key projects across the region over the last five years, investing GBP350,000 in on-the-ground nature conservation delivery.

Dorset Wild Rivers – Dorset Wildlife Trust Impact: Delivered 18 km of river restoration, created 135 hectares of habitat along watercourses and, for every GBP1 provided by Wessex Water, a further GBP5.80 has been matched (excluding in-kind or volunteer contributions) from other funding sources

South Wiltshire Farmland Conservation - Cranborne Chase Area of Outstanding Natural Beauty Impact: Supported four farm clusters involving 91 farms covering 33,649 BAP hectares to work more effectively to create landscape-scale Partners conservation of soil, water and biodiversity Programme

Wessex Chalk Streams Project - Wiltshire Wildlife Trust Impact: Delivered 25.4 km of river restoration, with a total value of GBP880,000 (including volunteer time) invested in the Hampshire Avon, providing a ratio of 1:8.8 to Wessex Water contributions

North Somerset Levels and Moors Grazing Marsh - Avon Wildlife Trust Impact: Restored 21 km of ditch network; provided grants to 28 farmers; installed 1,700 m of fencing, four drinking bays, one cattle corral and six scrapes to conserve rare wetland habitats in North Somerset.

Wessex Water also offers individual small grants between GBP2,500 and GBP5,000 for standalone projects applied for and awarded every six months, designed specifically for short-term and smaller scale practical projects which address catchment, ecosystems, as well as science and research issues. The recent projects funded in 2019 included:

Date Project Funded

Spring 2019 Devil’s Brook Multi Benefit Project - Farming and Wildlife and Dorset Wild Rivers

Autumn 2019 Curlew Call Project – Wiltshire and Swindon Biological Records Centre Gordano Bats Project – Avon Wildlife Trust

22 SUSTAINABILITY REPORT 2020

Protection of the Environment

Catchment Partnerships O VERVIEW Since 2018, the Bristol Avon Catchment Partnership has been involved in the development of five landscape-scale, strategic projects such as River Frome Reconnected. This has enabled partnerships working with a wider range of organisations to align priorities to improve the water environment, in particular working more effectively with NATURAL CAPITAL the five unitary authorities that are spread across the catchment area.

A further six projects have been supported via the Bristol Avon Catchment Partnership Fund during FY2020. These have focused on project development, feasibility work and education/ engagement, including: HU

• developing a landscape vision for the MAN

North Somerset Levels and Moors C APITAL • feasibility work on a fish passage on the Bristol Frome river • engaging with stakeholders on the By Brook subcatchment to develop a joint action plan. SOC IAL AND RELATI During FY2020, the Dorset Catchment Partnership worked with a broad range of partners to deliver improvements in the Poole Harbour, Stour, and West O N

Dorset Rivers and Coastal Stream S HIP catchments. This involved bringing in C additional funding from a range of APITAL sources to deliver more than 40 projects to improve biodiversity, water quality and nutrient management, as well as addressing barriers to fish passage and

physical modifications in the river FINAN channel, and inspiring positive behaviour C change among water users. More than IAL C 20 partners are involved, engaging APITAL around 2,500 people, including more than 500 landowners and farmers.

23 YTL GROUP

Protection of the Environment

YTL Jawa Timur (YTLJT) – Greenery Programme

Indonesia

Coastal habitats are facing increasing pressure as pollution and climate change activities intensify. With the vision to preserve and improve ecosystems of the coastal areas at Probolinggo, East Java, YTLJT has engaged with various stakeholders in 2013 to carry out the Randutatah Mangrove and Sea Pines Planting Programme. To date, YTLJT has planted over 175,042 trees of various species, creating a beautiful mangrove forest stretching along part of the 55 km coastline.

In collaboration with Bermi Village Enterprises (Bumdes Bermi), YTLJT also contributed to conserving and improving the natural environment near Bermi Village through tree planting and various Randutatah Conservation Area has been covered with greenery, mostly conservation activities. A total of 1,599 trees were planted in made up of mangroves and sea pines Bermi Eco Park, Probolinggo, utilising an area of five hectares. More information can be found in the “Community” section on page 79.

Types of trees planted

Randutatah Mangrove and Sea Pines Conservation Area

• 112,300 mangroves (Sonneratia alba, Rhizophora mucronata, Avicennia marina, Rhizophora tylosa) • 58,910 sea pines (Casuarina equisetfolia) • 2,200 bamboo trees • 1,100 Gayam trees (Tahitian Chestnut) • 400 Seeded Breadfruit (Kluwih) A number of conservation activities were conducted at Bermi Eco Park to improve the natural environment • 132 fruit trees (Durian, jackfruit and petai/stink bean)

Bermi Eco Park

• 1,334 flowering trees • 265 shade trees

The increase in the number of trees planted has successfully formed a greener ecosystem and driven the proliferation of biodiversity in the area, which are clearly portrayed in the rise of the Biodiversity Shannon-Weiner Index over the years from 0.6 to 2.43 for flora and 2.71 to 2.84 for birds.

YTLJT created a nursery for mangroves and sea pines

24 SUSTAINABILITY REPORT 2020

Protection of the Environment

ENVIRONMENTAL MANAGEMENT AND COMPLIANCE

Most of our key business units are certified under ISO 14001 Environmental Management Systems. YTL Cement and YTLJT attained ISO 50001 Energy Management Systems certification, whilst YTL PowerSeraya, YTL Starhill Global REIT Management (YSGRM), the Manager of Starhill O Global REIT (SGREIT), as well as YTL Starhill Global Property Management were awarded the Project Eco-Office certification for their green VERVIEW initiatives and practices.

To facilitate and ensure effective implementation of environmental management, training and awareness programmes are planned and conducted for employees. Topics include health, safety and environment (HSE) policies and operating procedures, environmental emergency preparedness and response, energy saving, waste recycling and water use.

There were no records of chemical or oil spill, nor were there significant fines or non-monetary sanctions for non-compliance with environmental laws and regulations that were administered by Malaysian or overseas authorities to YTL Group in FY2020. NATURAL CAPITAL

ATMOSPHERIC EMISSIONS

As part of regulatory compliance, we actively manage the air emissions from our power and cement operations. We have also implemented pollution abatement technologies to ensure a high level of compliance. In FY2020, all our plants continued to achieve 100% compliance with local air emission standards.

Air Emissions HU MAN YTL Jawa Timur Emissions C Unit Target FY2018 FY2019 FY2020 APITAL Parameters • NOx, particulates and carbon monoxide emissions increased in FY2020 due to the deterioration of coal’s quality. Decrease in Sulphur 0.36 0.14 0.14 0.25 Gross Caloric Value (GCV) of coal increases the quality of total dioxide (SO2) coal burnt to achieve the same amount of electricity generation, Nitrogen whilst the increase in coal burnt results in the increase of NOx. (tonnes/ 1.21 0.77 0.78 0.80 SOC oxides (NOx)

GWh) • Despite the slight increase in SO2, NOx and carbon monoxide IAL AND RELATI Particulates 0.16 0.05 0.09 0.09 emissions, the results are still within the stipulated target. Carbon – 0.08 0.10 0.15 Monoxide O N S HIP C YTL PowerSeraya APITAL Emissions Unit Target FY2018 FY2019 FY2020 Parameters • The results of SO2, NOx and particulates are in compliance with the emission standards stipulated by Singapore’s National Sulphur kg/MWh – 7.3E-6 4.50E-9 2.46E-9 Environment Agency (NEA) Code of Practice on Pollution Control. dioxide (SO2) FINAN Nitrogen • No data available on NOx, particulates and carbon monoxide for 400 – 29 – 36 25 – 45 2018.

oxides (NOx) C IAL

Particulatesmg/Nm3 50 – < 1 0 – 2 C APITA

Carbon 250 – 1 – 5 0 – 3 L Monoxide

25 YTL GROUP

Protection of the Environment

CLIMATE CHANGE

OUR GOAL: To reduce greenhouse gas (GHG) emissions to mitigate the impacts on the climate

Earth’s climate is now changing faster than at any point in the history of modern civilisation, bringing a range of risks to the long-term sustainability of businesses and communities. According to a special report by the UN Intergovernmental Panel on Climate Change (IPCC), limiting global warming to 1.5°C would require rapid and unprecedented changes to all aspects of society and the global net human-caused emissions of carbon dioxide (CO2) would need to fall by about 45% by 2030 from 2010 levels, reaching ‘net zero’ around 2050.

In line with YTL Group’s commitment to SDG 13 – Climate Action, we believe in continuous improvement and are committed to constantly addressing the risks of climate change. This is a crucial period in low carbon transition and presents good opportunities to place ourselves at the leading edge to try and avert this tipping point. Our climate change and business strategy focuses on reducing emissions, enhancing energy efficiency and adopting renewable energy technologies towards a low carbon economy.

GHG Reduction Energy Efficiency Renewable Energy

Work closely with our in-house consulting Reduce energy consumption and improve Increase renewable energy use company YTL-SV Carbon (YTL-SVC) on efficiency measurement, reduction and offsetting Expand our renewable energy portfolio GHG emissions for a low carbon economy Integration of best energy management and adoption to all business units strategies into daily operations Explore and promote nature-based Explore leading edge renewable energy solutions (including reforestation, Adoption of ISO 50001 Energy Management technologies as viable alternatives with protection and restoration of natural Systems and Building Management System partners ecosystems) Explore and source energy efficient technologies with partners

26 SUSTAINABILITY REPORT 2020

Protection of the Environment

GHG Emissions Data

YTL Jawa Timur (YTLJT) O 6% (compared to 2015) VERVIEW YTLJT’s initiatives for long-term reductions: GHG Emissions (kilotonnes CO2e/year) • Improvements in plant energy efficiency. • Use of biodiesel for all its heavy-weight equipment. FY2020 7,040 34 • Replacement of diesel used in boiler with biodiesel. FY2019 7,577 32 YTLJT’s GHG emission intensity remained the same as the previous FY2018 7,319 34 year at 0.87 tCO2e/MWh.

Scope 1 Scope 2 NATURAL CAPITAL Achieved 38.8% thermal efficiency, which remained unchanged from its first commercial operation in 2001.

YTL PowerSeraya 0.4% (compared to 2015) YTL PowerSeraya continues to improve plant efficiency by: GHG Emissions (kilotonnes CO2e/year) • Maintaining the efficiency levels of the power plant units close

to design limits through periodic preventive maintenance of the 0.08 HU

FY2020 3,507 MAN power plant units. 237 0.10

FY2019 C • Seeking ways to continually improve the efficiency of existing 3,591 121 APITAL 0.14 power plants. FY2018 3,740 34

Scope 1 Scope 2 Scope 3 SOC IAL AND RELATI Wessex Water 3% (compared to 2015) Wessex Water continues to reduce their carbon footprint through: GHG Emissions (kilotonnes CO2e/year) • Preventative aspects of catchment management. O N

• Extensive energy efficiency work. S FY2020 HIP • Generation of renewable energy from digestion of sewage sludge 50 59 10 C APITAL and food waste, hydro and solar. FY2019 48 62 10

FY2018 Wessex Water recorded lower emission intensity of 0.18 tCO2e/Ml 48 75 12

(tonnes of carbon dioxide equivalent per megalitre) for treated water Scope 1 Scope 2 Scope 3 and 0.14 tCO2e/Ml for sewage water, as compared to FY2019. FINAN Note: Target Net GHG emissions in FY2020 Wessex Water regulatory year runs from 1 April 2019 to 31 March 2020 C 119 ktCO2e 117 ktCO2e IAL C APITA L

27 YTL GROUP

Protection of the Environment

Climate Adaptation Nature-based Solutions (NbS) and Community-based Adaptation Initiatives across YTL Group Climate change has resulted in a wide range of impacts across every Tree Planting region of the globe and within YTL Group takes advantage of many sectors of the economy that biodiversity and ecosystem services are expected to grow in the to adapt to climate change, which coming decades. Many countries includes tree planting at several are realising that it may be time locations where we operate. to start adapting to a warmer world.

YTL Corporation (YTL Corp) Understanding the need and urgency for climate adaptation, YTL • 100 trees planted at Sentul Park under 2014 Lay Yong Group strives to go beyond being Grove Tree Planting. mitigation centric by creating • 100 trees planted and additional 400 trees to be planted awareness, knowledge sharing, at Sentul Park under 2018 Tree Planting Programme. empowering communities to adapt to climate change, through various Gaya Island Resort (GIR) nature-based solutions and community-based adaptation plans • 3,000 mangrove saplings sowed with an additional 500 and initiatives across business seedlings propagated. units, such as protecting and restoring natural ecosystems, water YTL Cement conservation, mangrove planting • Up to 10,000 saplings to be planted in our in-house and conservation, coral reef nursery in Kanthan, Perak under Plant Recce and rehabilitation, flood alleviation and Translocation Project. green infrastructure enhancement. More details can be found in the “Biodiversity” and “Community” YTL Jawa Timur (YTLJT) sections of this report. Through YTLJT Greenery Programme at Randutatah Mangrove and Sea Pines Conservation Area and Bermi Eco Park, 176,641 trees have been planted which have sequestered 185,550 kg of CO2 to date.

Wessex Water

Save a Tree, Plant a Tree by Phil Bakerian, Wessex Water has partnered with Woodland Trust in tree planting to offset paper biling. Through this programme, Wessex Water Force volunteers also help to plant trees in an effort to restore the riverside habitat in Wilsford, Wiltshire.

28 SUSTAINABILITY REPORT 2020

Protection of the Environment O VERVIEW

Partnership through The RESCCUE Project

Wessex Water

• Wessex Water is one of the partners in the EU-funded RESCCUE project, which aims to provide a framework for city resilience to climate change.

• Focusing on the effects of sea level rise, more extreme rainfall conditions and the cascading NATURAL CAPITAL impacts of flooding on other city functions such as transportation, power supply and waste management. • A Resilience Action Plan is being developed for Bristol and assessment of future flood prevention infrastructure is well advanced.

Go Lo-CO2 Programme

Express Rail Link (ERL) HU

• Raising public awareness on reducing carbon emissions through MAN public rail transport. C APITAL • Reduced a total of 140,291 tonnes of carbon dioxide equivalent (tCO2e) from 2015 to 2020, equivalent to four million cars taken off the road from KL Sentral to KLIA every year.

Water Conservation SOC IAL AND RELATI YTL Jawa Timur (YTLJT)

• Initiated a programme for a nearby village to assist them to adapt to more extreme weather events that herald inconsistent clean O water supply. More details can be found on page 79. N S HIP C APITAL

Coral Reef Restoration

Gaya Island Resort Centre (GIRMC), Pangkor Laut Resort (PLR), YTLJT FINAN • Coral reefs provide a buffer against waves, storms and floods, which C help to prevent erosion and property damage. YTL Group is committed IAL C

to coral reef restoration initiatives at several locations. More details APITA can be found on page 18. L

29 YTL GROUP

Protection of the Environment

ENERGY EFFICIENCY AND RENEWABLE ENERGY Energy Consumption

6% (compared to 2015) OUR GOAL: To promote energy efficiency and the development of YTL Jawa Timur (GWh) renewable energy

FY2020 394

In order to propel the growth of the renewable energy sector in FY2019 419 accordance with Malaysia’s target of a 20% increase in its total FY2018 434 energy generation mix by 2025, YTL Group has been exploring opportunities to improve energy efficiency and expand the renewable energy portfolio and use. Once tested successful, these best practices are then expanded progressively across YTL Group. 21% (compared to 2015)

Energy Reduction and Management YTL PowerSeraya (GWh)

Adoption of FY2020 ISO 50001 Energy 231 Management FY2019 246 Systems (EnMs)

FY2018 252 Climate-resilient design Chiller and and installations lift optimisation – green roofs and walks, and maximising natural modernisation lighting and ventilation 26% (compared to 2017)

Employee awareness Converting to SGREIT (GWh) including unplugging energy efficient appliances, electronic appliances FY2020 30 when not in use lighting and equipment FY2019 38

FY2018 38

Upgrading of Building Management System (BMS) – (compared to 2015) installing sub-metering 12% systems, fitting control systems, motion Wessex Water (GWh) sensors, occupancy sensors and dimmers FY2020 271

FY2019 262

FY2018 256

Note: Wessex Water’s regulatory year runs from 1 April 2019 to 31 March 2020. Wessex Water’s energy consumption increased due to increased standards for water treatment and weather conditions as wet winters increase the load on sewage pumping stations, resulting in more electricity used.

30 SUSTAINABILITY REPORT 2020

Protection of the Environment

YTL Group’s Energy Conservation Measures

Malaysia Singapore Australia

ERL Maintenance Support (E-MAS) YTL PowerSeraya Melbourne Marriott Hotel O VERVIEW Energy Saving Programme: • Periodic preventive maintenance of • Make a Green Choice - Guests have the • Unplug all electronics and electrical power plant units. option to have Marriott Bonvoy points appliances daily in order to eliminate • Seeks ways to continually improve the credited to their account instead of phantom power load. efficiency of existing power plant. daily housekeeping services, whilst reducing environmental impacts. YTL Cement SGREIT – Wisma Atria • Upgraded chiller system. tion aniza for rg St O an l d a a n r o d i i t z

a a

n ti

r o

e

n t n I Implemented ISO 50001 EnMS Wisma Atria’s initiatives in commitment to • New web-based open protocol Niagara 50001 their 15% reduction in energy consumption: BMS system to optimise energy management. • Installation of roller presses and • System and equipment upgrade NATURAL CAPITAL repositioning of damper for cement mill including higher efficiency motor and Brisbane Marriott Hotel fan for energy saving. pumps, LED lights and motion sensors, modernisation of lifts. Energy Saving Initiatives includes upgrade YTL Hotels, YTL Land & Development • Ongoing overhaul of chiller systems at of equipment such as: Properties, E-MAS, SGREIT – Lot 10 Wisma Atria, which have reached the • Thermal curtains; and The Starhill end of their lifespan. • LED lights; • Replaced conventional metal halide with • Submit energy report to Singapore’s • Electric shutter door; high efficiency LED lighting. Building and Construction Authority • Ice machine and free-standing freezer. through Building Energy Submission System (BESS). Indonesia Sydney Harbour Marriott Hotel HU

YTL Jawa Timur Energy Saving Initiatives includes: MAN

tion aniza for rg St O an l d C a a United Kingdom n r d io • Upgrade of chiller water plant system i t z APITAL

a a

n ti

r o

e

t n Implemented ISO 50001 EnMS n I with Chiller Plant Optimiser (CPO). 50001 since 2012 Wessex Water • Technical study on gas-related emission 6.30 MWh Energy Saving Activities: reductions. energy saved Target: • On-site audit programme. • 70% reduction of GHG emissions and 19,144.36 • Fitting control system on equipment. SOC net zero emissions by 2050. tonnes coal saved • Energy bonus to engage employees to IAL AND RELATI reduce energy consumption. 83,025 tonnes SGREIT – Myer Centre Adelaide • Automatic meter reading equipment for of CO2 saved • Upgrading of BMS. accurate energy use data.

• Awarded 5.0 star ratings in NABERS O

Energy Saving Programme – Optimisation of N

Energy Base Building for overall energy S machineries for reduction of primary energy HIP performance.

consumption C APITAL • Replacement of Unit 50 feeder motors SGREIT – David Jones, Perth to variable speed drive (VSD) motors. • Energy efficient chiller installed. • Upgrading Unit 5 boiler by adding heat exchanger pipe of primary SH and RH platen. FINAN • Optimisation of circulating water bypass

valve opening. C IAL C APITA L

31 YTL GROUP

Protection of the Environment

ACCELERATING RENEWABLE ENERGY INTEGRATION

In support of the transition to a low carbon economy, YTL Group has incorporated green technologies in their business strategy and planning with the adoption of renewable technologies with innovative energy efficiency in areas where we operate.

Solar Power

YTL PowerSeraya recently completed the solar YTLJT has embarked on a series of solar PV Wessex Water has successfully integrated solar photovoltaic (PV) panel installation at its Jurong installations, projected to reduce grid electricity generation at two of its larger sites. Island Power Plant. consumption by 20%. Outcome Outcome Outcome • 250 kWp solar PV array on the roof of Bath • 1.28 GWh of solar energy was generated in FY2020 • 111 kWp solar PV installed. Operations Centre at Claverton Down. where the energy generated was used to provide • 420,326 kWh energy generated since installation. • 50 kWp solar PV at Yeovil treatment facility in green energy options to YTL PowerSeraya’s • 372.9 tCO2e reduced. Sutton Bingham Water Treatment Work (WTW). customers. • Contributed towards the 26% of renewable energy use.

Waste Heat Recovery (WHR)

Electricity Residual heat produced for energy from plant’s own pre-heater and consumption clinker cooler YTL Cement first started residual heat In 2015, YTL Cement extended the recovery through WHR unit in Zhejiang residual heat recovery to their Waste Heat Hangzhou Dama Cement Plant in 2011 plant in Perak-Hanjoong Simen Recovery with 9 MW capacity. (PHS) with 10 MW capacity. (WHR) Steam Recovered Outcome Outcome generated to through low • 22,522 MWh electricity generated • 48,527 MWh electricity drive steam temperature in FY2020. generated in FY2020. turbine boilers • Estimated reduction of 14,603 • Estimated reduction of 28,388 tCO2e. tCO2e. • Invested RM70 million in the WHR unit in 2015.

32 SUSTAINABILITY REPORT 2020

Protection of the Environment

Electric Vehicle (EV) Adoption Micro Hydro O VERVIEW

YTL PowerSeraya replaced their old diesel van with YTLJT continued their renewable energy initiatives an EV at Jurong Power Plant. through the use of five units of Viar Q1 electric

motorcycle, in which one unit was used at Summitmas NATURAL CAPITAL Outcome Building in Jakarta and four units at Paiton II Power • 0.55 tCO2e avoided by EVs in FY2020, covering Plant and Operator Housing Complex (OHC). 335.6 km on a monthly basis6. Outcome • 0.098 tCO2e avoided by using electric motorcycles. HU MAN C APITAL

Wessex Water has hydro units installed at three The large-scale trials of EVs started by GENeco UK in 2019 continue to move towards eliminating diesel and locations. petrol vehicles from its fleet. Outcome Outcome • Three operational hydro schemes installed; • GENeco UK’s ‘grey fleet’ is becoming more green as employees look to move towards renewable energy – Maundown WTW: 320 kW. SOC and new technologies. – Ashford WTW: 15 kW. • More than 50 tCO2e of emissions savings per year, equivalent to taking 24 cars off the road. – Hawkridge (Spaxton) Reservoir: 5.5 kW. IAL AND RELATI O N S HIP C APITAL FINAN In support of the use of EVs, parking lots are reserved As an advocate for pollution reduction, YTLJT is YTLJT’s micro hydro installation under the Alternate

for shoppers driving EVs, with electrical power points cooperating with Summitmas Building Management Energy Development (AED) Programme has benefitted C IAL for drivers to charge their vehicles. and PLN Disjaya in establishing EV charging stations. local communities at Probolinggo and Situbondo C

regencies. APITA Outcome Outcome

• Five units of EV Carparks have been set up at Lot • One unit of General Electric Filling Stations (SPLU) Outcome L 10, Malaysia and Wisma Atria, Singapore. has been established at the Summitmas parking • 39 units installed. lot. • Supplying up to 5,214,782 kWh electricity since the first unit was installed in 2012.

6 Estimated monthly mileage is based on January to August 2020 mileage figures 33 YTL GROUP

Protection of the Environment

Biogas and Biomethane Green Power for Customers

GET IT GREEN GET SUNNY

GENeco UK has recently completed Running on a closed-loop system, Zero carbon footprint 100% clean energy for the successful trial of a bio-CNG GENeco UK is supplying green gas (compressed natural gas) powered derived from sewage sludge to local for one year 18 months sludge tanker, where the truck runs homes. GENeco UK also generates gas on 100% renewable and sustainable resulting from the treatment of food biomethane derived from waste and waste collected by the expanding fleet Geneco SG expanded their green venture through offering green energy packages approved under Renewable Transport of Bio-Bees that are also powered by to their customers. Based on the chosen plan, RECs or carbon credits are retired Fuel Obligation (RTFO). biomethane. on behalf of customers to claim Renewable Energy usage or use of carbon neutral electricity respectively. Outcome Outcome • More than 40% fuel cost saving • 100% carbon neutral gas. Outcome equivalent to CO2 reduction of over • 100% renewable electricity. • Geneco SG was among the top three Open Electricity Market (OEM) electricity 80% compared to a diesel vehicle. • Reduced sulphur, CO2 and pollutant retailers by market share in Singapore as of March 20207. emissions compared to conventional • Sold an estimated 325 MWh of renewable electricity to customers in FY2020. petrol and diesel.

Under the AED Programme, YTLJT constructed 680 biogas domes, supplying cooking gas and fuel for lighting for local communities.

Outcome • Generated 1,176,710 m3 methane gas. • 2,808 villagers benefitted.

GENeco UK exports biomethane to the local gas grid, and has formed partnerships with Bulb Energy and Ovo Energy to provide renewable energy to local communities.

Following the installation of an Outcome advanced anaerobic digestion system • Up to 1,900 m3/hr of enriched methane produced by cleaning and upgrading at Trowbridge water recycling centre, methane-rich biogas from anaerobic digestion of sewage sludge. Wessex Water made good progress with the scheme to improve digestion at Berry Hill, near Bournemouth. In FY2019, the Trowbridge Gas to Grid plant was installed, allowing the injection of biogas into the UK gas grid.

Outcome • 954,143 m3 biomethane fed into the GENeco UK partnered with Unilever for the supply of certified biomethane grid at Trowbridge plant in FY2020. originating from anaerobic digesters at the Bristol Sewage Treatment Works. • 1,930 tCO2e saved through displacing natural gas. Outcome • Projected to supply 10,000 MWh biomethane to over five of Unilever’s sites in the UK and Ireland.

7 Source: Energy Market Authority, Singapore

34 SUSTAINABILITY REPORT 2020

Protection of the Environment

YTL Jawa Timur – Alternative Energy Development (AED) Programme in Probolinggo and Situbondo, Indonesia –

Indonesia O VERVIEW

With the aim to reduce the dependence of local communities on non-renewable and hazardous energy sources, YTLJT developed the AED Programme. Since the launch of the AED Programme in 2012, the lives of the local communities in the Probolinggo and Situbondo regencies have been positively impacted.

5,258,735 kWh of electricity generated NATURAL CAPITAL

1,176,710 m3 of biogas generated

7,063 villagers from 1,460 households benefitted

of CO2 reduced 53,603 tonnes Local communities celebrating the installation of a micro hydro unit at their village

Total electricity HU

Cumulative Installed MAN (kWh)/methane Equivalent CO2 units capacity C

Project generated (m3) reduction APITAL installed up (kW/number cumulative since (tonnes/year) to 2019 of cows/Wp1) installation

Micro hydro 39 95.3 kW 5,214,782 kWh 4,637

Domestic biogas 680 1,360 cows 1,176,710 m3 48,928 SOC

Solar energy 65 8,710 Wp 43,952 kWh 39 IAL AND RELATI

Note: 1. Wp stands for watt peak, the peak output power achieved by a solar module under full solar radiation. 2. No additional micro hydro and solar street lighting systems were built this year, as the company focuses on maintenance of the existing units. 3. 35 units of domestic biogas were planned for construction in FY2020; however, it was suspended due to the COVID-19 pandemic and the construction O

re-commenced in early July 2020. N S HIP C APITAL FINAN C IAL C APITA

Construction of dome-shaped digesters engineered to Monitoring of the performance of a micro hydro unit Street lighting was replaced with solar cells at the OHC L generate biogas from the digestion of cow manure by the YTLJT team entrance

35 YTL GROUP

Protection of the Environment

WASTE MANAGEMENT AND RESOURCE EFFICIENCY

OUR GOAL: To manage waste streams through effective and responsible reuse, recycling or disposal

Landfilling is currently the ultimate waste disposal method that can deal with many types of materials, and most of the waste and potentially recyclable materials including paper, plastic, aluminium and glass ends up in landfill sites. In addition, an increasing volume of electrical and electronic devices (e-waste) from private households is disposed of in open landfills every year. Waste management has become an extremely critical issue to be solved.

At YTL Group, we place a strong focus on the importance of resource efficiency at all our business units. All resource use is carefully planned, efficiently utilised and processed to optimise output levels. We also continuously look for ways to reduce unnecessary consumption and waste, ultimately aiming for zero waste to landfill and towards a circular economy through various initiatives such as YTL Group’s Say No to All Plastic (SNAP) campaign, recycling, composting, co- processing, waste to energy (WTE) as well as responsible disposal. Great emphasis is placed on how hazardous waste generated is handled, stored and disposed of in a manner that adheres to best practices and meets local regulatory requirements. Consumers encouraged to go green by recycling Tetra Pak cartons and old clothes

Waste Generation Data

YTL Jawa Timur 16% (compared to 2015)

Total Waste Generation (tonnes) Waste Diverted from Landfill (%)

127 FY2020 83,598 18,494 11 112 82 FY2019 90,462 19,607 10 81 128 73 FY2018 83,255 16,268 0

Fly Ash Special Waste Bottom Ash Waste Bank’s Recyclables FY2018 FY2019 FY2020

• Total waste generated includes data on recyclables collected through Waste Bank Programme, which covers OHC and Paiton II Power Plant, fly ash and bottom ash, as well as special waste. • In accordance with local regulations, all hazardous waste is collected by licensed collectors for disposal and recycling, or sold to cement and ready-mix industries to be reused as construction materials, or re-processed as alternative fuels or materials for internal usage. • Total hazardous waste decreased by 7% in FY2020 as compared to the previous year, mainly due to the decreasing demand of fly ash from cement and ready-mix industries.

36 SUSTAINABILITY REPORT 2020

Protection of the Environment

YTL PowerSeraya (compared to 2015) 67% O VERVIEW

Total Waste Generation (tonnes) Waste Diverted from Landfill (%)

19 FY2020 162 50 38 34 FY2019 92 147 124 21 FY2018 129 195 200

Industrial Waste Recyclable Waste General Waste FY2018 FY2019 FY2020 NATURAL CAPITAL

• All industrial waste in accordance with local regulations, collected by licensed collectors, or sold for recycling. • Industrial waste has decreased over the years due to the drop in the operation of heavy fuel oil power plants. • Percentage of waste diverted from landfill has decreased this year, due to a decrease in industrial waste and used fuel oil, used diesel and used lube oil.

SGREIT 19% (compared to 2017)

Total Waste Generation (tonnes) Waste Diverted from Landfill (%) HU MAN

FY2020 1,458 125 10 C APITAL 8 8 FY2019 1,820 167

FY2018 1,775 195

Non-recyclable Waste Recyclable Waste FY2018 FY2019 FY2020 SOC IAL AND RELATI

• Data collected from SGREIT’s properties at Lot 10 and The Starhill, Malaysia, Wisma Atria, Singapore and Myer Centre Adelaide, Australia. In Malaysia, data on non-recyclable waste is unavailable, as the waste collector only weighed recyclable waste. • YSGRM records, tracks and reports the waste data on a monthly basis to National Environment Agency of Singapore (NEA) to allow further improvement in their waste management system. Moving forward, YSGRM plans to maintain and/or increase the amount of recyclable waste generation. O N

• Recyclable waste included hazardous waste such as electronic waste (e-waste) and used cooking oil. S HIP • For FY2020, total non-recyclable waste has decreased by 19.9% while total recyclable waste has dropped by 25% due to Circuit Breaker measures, C

which include the suspension of business trading for non-essential services and only takeaways or deliveries allowed for food and beverage APITAL outlets. Following the easing of Circuit Breaker measures, a slow business pickup thereafter due to work from home arrangements and safe distancing measures have also resulted in less waste being generated.

Wessex Water FINAN Non-sludge Waste Diverted from Landfill (%) • Wessex Water’s regulatory year runs from 1 April 2019 to 31 March C

2020. IAL

• Ten years ago, Wessex Water set a stretching target to divert 100% 99.8 C APITA of their non-sludge waste from landfill by 2020. With much hard 99.7

work and commitment, they are very pleased to have achieved 99.7% L 99.1 diversion from landfill during FY2020. The only remaining waste streams that are consistently being sent to landfill – though at very low volumes – are asbestos-contaminated waste, and waste FY2018 FY2019 FY2020 contaminated with certain invasive species; both of which have no legal alternative disposal routes. 37 YTL GROUP

Protection of the Environment

Waste Diversion in Action across YTL Group

Hazardous Waste Disposal

YTL Group – E-waste

YTL Group ensures that all of its e-waste is inspected and properly disposed of byby licensed third-party scheduled waste carriers, where the respective IT departments across YTL Group in Malaysiaa were in chargecharge of e-waste collection, inspection and proper disposal. In FY2020, over 5,600 kg e-waste waswas collected.collected.

YTL Jawa Timur – Fly Ash and Bottom Ash (FABA) Recycling

• FABA generated from the incineration process in coal-fired power plants is regardedregarded as hazardous waste. YTLJT responsibly manages their FABA waste andd throughthrough innovation turned them into 2,719,131 paving blocks utilised for different functions.nctions. More information can be found on page 42.

Zero Waste Revolution: The Circular Innovation

YTL Hotels and SGREIT – Lot 10, The Starhill – Used Cooking Oil (UCO) Recycling

• 15,920 kg of UCO was collected in FY2020. The UCO was sold to a third-party recycling company and then distilled to be made into biodiesel. The fuel is distributed and used mainly for transportation.

GENeco UK – Zero Waste to Landfill Project

• Over 700,000 tonnes of waste was treated and transformed into usable products such as biofertilisers and renewably-sourced gas and electricity.

• 1,500 tonnes of waste was collected and turned into biomethane, sufficient to fuel the Bio-Bee vehicle for 676,000 miles. More details can be found on page 43.

Tackling Food Waste

A number of food waste management initiatives have been undertaken, including tracking food waste data, low waste menu planning, food procurement and preparation, tapping into food waste innovation, employee training and education, customer engagement and working with partners.

GENeco UK – “Slim My Waste Feed My Face” Food Recycling Campaignaign

Launched in 2018, it was designed to increase food waste recycling in Bristol,istol, in collaboration with Bristol Waste Company. Over 1,000 free caddies, stickers andnd lealeafletsflets were given out to create awareness amongst residents, where the decoratedted caddies were shared on social media. The campaign was further enhanced throughh social media, educational workshops as well as assemblies in the local schools. The collectedected foodfood waste was then treated at GENeco UK’s Bristol Bioresources and Renewable Energynergy Park, where it generates renewable energy and biofertilisers.

• 16% increase in the amount of food waste collected in the month followingwing the launclaunchh • 290.5 tonnes of additional waste collected • 174.3 tCO2e saved by diverting food waste from landfill • Equivalent of taking an additional 55 cars off the road for a year

38 SUSTAINABILITY REPORT 2020

Protection of the Environment O VERVIEW Co-processingCo-processing – ManagingManaging andand Repurposing Waste

YTL CCementement

OurOur cement plants utilised,utilis processed and repurposed waste materials to partially replace traditional ffossilossil fuel and raw materials. Through these initiatives, we reduced our carbon footprint and usageusage of natural resources compared to the traditional cement manufacturing process. At the same time, wew provide long-term solutions to industries in the management of different tytypespes of wwaste generated in day-to-day activities. NATURAL CAPITAL InIn FY2FY2020, our waste management services and co-processing activities have saved a totaltot of 17,800 m2 of land from being used as landfill for waste.

SayS No to All Plastic (SNAP) Campaign

YTL Group

A group-wide initiative was rolled out towards achieving zero Single Use Plastic (SUP) by 2025. Several business units have contributed in the plastic reduction movement through various initiatives including going plastic free, adopting the 3Rs concept – Reduce, Reuse and Recycle, HU driving behavioural changes, etc. More details can be found on page 40. MAN C APITAL Going Green through Recycling

YTL Hotels

44 tonnes of waste recycled SOC

SGREIT – Lot 10 and The Starhill IAL AND RELATI

17.3 tonnes of waste recycled

SGREIT – Lot 10 X Kloth Cares O N

S

8,890.6 kg of clothes collected and recycled HIP C APITAL GGoo GreenGr Campaign

ExpresExpresss Rail Link

• 600 600 kg ofof clothes collected and recycled in collaboration with Community Recycle for

CharityCharity ((CRC).C FINAN

• Partnering with TTetra Pak Malaysia, 3 kg of Tetra Pak cartons recycled, including the caps and C sstrawstraws ffromrom May to August 2020. IAL C APITA • Go Green ChallengeChallenge – An employeeem competition on zero waste tips during Movement Control Order (MCO)

period.period L

• Say No to Paper – Paperless ticketing and zero paper usage in office.

39 YTL GROUP

Protection of the Environment

YTL Group – Say No to All Plastic (SNAP) Campaign –

Plastic Reduction Performance

1. Going Plastic Free

YTL Group has contributed to phasing out SUP through various initiatives such as:

• Setting up water dispensers, filtration units and reverse osmosis plants; • Switching to compostable food containers and cutlery for takeaways; • Switching to cloth/reusable laundry bags; • Using refillable ceramic bottles in bathrooms and switching to wall mounted fixtures for amenities; • Ensuring no SUP used during events including YTL LEAD Conference, YTLJT’s annual gathering and internal meetings (training, official visitor, etc.), Independence Day Celebration as well as Lottie’s Project Background: Science Adventures and YTL scholars training organised by YTL Plastic pollution is one of the most pressing threats to the Foundation. environment and specifically the oceans. Spearheaded by our Executive Chairman, Tan Sri Dato’ (Dr) Francis Yeoh and championed by YTL Group Sustainability Division, we rolled out our Group-wide roadmap to eliminate all SUP by 2025. In our commitment to 131,131 straws achieve this ambitious goal, we embarked on a series of initiatives saved annually such as setting up of baseline targets across business operations, raising awareness through SNAP campaign, introducing alternative solutions to replace SUP, as well as taking collective action through 879,941 plastic partnerships and collaboration. bottles saved

Plastic Waste Strategy 2. Reduce, Reuse, Recycle Engage with all business units and Engagement • Collaborating with third-party vendors, YTLJT has been reusing other stakeholders and recycling chemical containers at the power plant through suppliers for the same chemical application. Identify baseline year and collect waste Data Collection generation data for all offices • Recycling coffee capsules through participation in the “Recycling at Home” programme by returning used capsules to the vendor.

Analysis Analyse baseline data collected

Propose viable alternatives to respective Proposal business units 8.15 tonnes of plastic waste Implement suggestions by respective saved Implementation business units 67,858 coffee Evaluate results and continue to search capsules recycled Evaluation for better processes and technologies moving towards zero SUP

40 SUSTAINABILITY REPORT 2020

Protection of the Environment

3. Awareness in Action 5. Collective Action O VERVIEW • Distribution of reusable water bottles and lunch boxes to 143 kg of waste collected, with employees and local communities by several business units – 78 kg residual waste including YTL Hotels, Geneco SG and Wessex Water. – 60 kg organic waste – 5 kg plastic waste • Tanjong Jara Resort (TJR) collaborated with Lang Tengah Turtle Watch (LTTW) on coastal cleanup events at Tahu Tiga Beach.

1,466 kg of waste collected NATURAL CAPITAL 1,027 water bottles and 255 lunch boxes distributed • Wessex Water has reduced plastic use within their business and focuses on three types: – Operational waste plastic (laboratory gloves and plastic packaging); – Water cycle plastic (wet wipes and other sanitary items); 4. Driving Behaviour Change – Plastic water bottles bought by customers. • A series of newsletters on plastic waste reduction, SNAP, were curated and disseminated to all YTL Group employees to provide Hydrate Feels Great guidance on how to minimise the use of SUP and suggestions Wessex Water continues to promote the health and cost benefits HU

for alternative materials. MAN of tap water as well as to encourage the use of refillable bottles

• YTLJT organised a Global Plastic Pollution Awareness Campaign rather than buying plastic bottled water or other drinks. C APITAL and Beach Cleaning Activity at Randutatah Conservation Area, graced by Nugie, the Indonesian Artist Environmental Ambassador. SOC IAL AND RELATI O N S HIP C

Bath Ocean Plastic Day 2020 APITAL

An education and awareness event where Matt Wheeldon, Director of Asset Strategy and Compliance of Wessex Water shared practical solutions and actions to solve the ocean plastic crisis.

Target: No waste to landfill FINAN

FY2020: 99.7% waste C IAL diverted from landfill C APITA

Plastic cups, bottles, cutlery and stirrers L removed from Wessex Water’s offices and depots.

41 YTL GROUP

Protection of the Environment

YTL Jawa Timur – Fly Ash and Bottom Ash (FABA) Recycling

Indonesia

Electricity generation process

Coal-fired power plant FABA Recycling FABA block Road pavement, coral cementing blocks, etc.

712,524 paving blocks produced in FY2020, adding to 2,719,131 paving blocks since obtaining a 30,132 kerbs produced in FY2020 legal permit in March 2016

98% of fly ash utilised internally for paving block 85% of special waste (oil waste and battery production and by third-party cement and ready-mix waste) recycled through third-party/utilised industries internally (WWTP sludge cake)

Utilisation of FABA Blocks

Construction of pavement at Bermi Eco Park Jogging track at Randutatah Conservation Area

Substrate used for coral transplanting Construction of biogas domes

42 SUSTAINABILITY REPORT 2020

Protection of the Environment

Wessex Water – Zero Waste to Landfill Project

United Kingdom O VERVIEW

Through Wessex Water’s Zero Waste to Landfill Project, the company seeks to divert waste that it produces or manages away from landfill and towards recycling or reuse options. Beginning in 2010, Wessex Water has progressed steadily and has achieved 99.7% diversion of their total waste from disposal to landfill, which comprised of 183,574 tonnes of waste recovered from a total of 183,600 tonnes waste generated.

As a subsidiary of Wessex Water, GENeco UK operates as a circular economy organisation, treating over 700,000 tonnes of varied waste per annum, including food, liquid, and solid materials. Through their processes, the waste is transformed into usable products

such as biofertilisers, and renewably-sourced gas and electricity powering thousands of local homes. In the last 12 months, the NATURAL CAPITAL Bio-Bee vehicle has collected over 1,500 tonnes of waste where the biomethane generated from the food waste is sufficient to power 179 households with renewable energy for a year or fuel the Bio-Bee vehicle for an incredible 676,000 miles. HU MAN C APITAL

Case Study – Westonbirt

An on-site café that produces food waste from catering SOC

services and offices, Westonbirt was keen to find a way IAL AND RELATI Injected into the national to dispose of their waste responsibly. After using the gas grid Commercial food waste Bio-Bee food waste collection service for a year, Westonbirt Arboretum was able to divert 11.5 tonnes of unsold O

and surplus food from landfill, producing 2,516 m3 of N S biomethane to fuel the Bio-Bee vehicle for 5,050 miles. HIP C APITAL

Biogas produced Power vehicles Low emission and upgraded food waste Follow the simple mantra of Reduce, Reuse to biomethane collections and Recycle. Reducing consumption is the best way to battle climate change and FINAN minimise our impact on the planet” C Processed by anaerobic Kit Beaumont IAL C

digestion at sewage works Recreation Manager at Westonbirt Arboretum APITA L

43 YTL GROUP

Protection of the Environment

WATER STEWARDSHIP Water Management Water Withdrawal

OUR GOAL: YTL Jawa Timur To enhance water efficiency in daily operations

1,114,646,661 Today, most countries are faced with unprecedented pressure on For the use in once-through condenser water resources. According to The World Bank, the world will face a cooling water system 40% shortfall between forecast demand and available water supply by 2030 . At YTL Group, we prioritise the practice of sustainable water 741,561 management and efficiency to ensure long-term clean water accessibility, For the use in Wastewater Treatment Plant whilst at the same time benefitting people, planet and profit. Seawater (WWTP)

As part of ISO 14001 Environmental Management Systems, all wastewater and/or sewage discharged from power plants, construction sites, sewage treatment sites, cement and quarry sites are regularly assessed and monitored by an accredited third-party consultant approved by local authorities. We regularly review the water management plans for all our properties and introduce water conservation initiatives YTL PowerSeraya where areas for improvement are identified. We have also developed technologies and innovations to treat, reuse and recycle water from our operations so that we can manage our water footprint in a responsible way. This is not only a part of regulatory compliance and wastewater management processes, but also to safeguard water 9,670 resources throughout our supply chains and ensure minimal negative From municipal supply impacts of discharge to the environment and ecosystems.

Freshwater WATER CONSUMPTION AND MONITORING

We are vigilant about water consumption and make informed decisions based on proven methods and best practices, be it technological enhancement, administrative control measures, or encouraging conscientious and ethical behaviour within the company, along our supply chains and with our customers. SGREIT

The total water consumption of YTL Group consists of potable water from municipal supply and NEWater or treated wastewater, recycled water and seawater. In FY2020, the total water consumption of YTL Group’s operating properties was about 3,024,000 m3 (based on our 336,000 reporting boundary). The increase in water consumption is largely From municipal supply attributed to internal system error and external disturbance on the electricity grid. The majority of water consumption goes to cooling towers, equipment (boilers, etc.), toilets, washing activities and landscaping. Freshwater

All trade effluent from our operations is treated and discharged to water courses or sewer systems in accordance with the environmental discharge limits and effluent standards in the countries where we operate. YTLJT, YTL PowerSeraya, and SGREIT successfully met their own targets in recycling and reusing an average 3% of their wastewater respectively, for internal use and/or other purposes. Over the years, we have consistently achieved 100% compliance to water discharge quality under local standards. There were no significant chemical or oil spills during the reporting period.

44 SUSTAINABILITY REPORT 2020

Protection of the Environment

Water Consumption Wastewater Treatment and Recycling O

(Change in wastewater recycled VERVIEW 12% (compared to 2015) 58% as compared to 2015)

YTL Jawa Timur ('000 m3) YTL Jawa Timur Total Water Treated and Recycled

FY2020 63 256 FY2020 690

FY2019 57 241 FY2019 604

FY2018 63 226 FY2018 581

Total treated water ('000 m3) Water recycled (%) NATURAL CAPITAL

• The water consumption in FY2020 increased by 14%. This was mainly due to • In FY2020, YTLJT treated 256,000 m3 of wastewater, where 63% of it was the increasing number of unit shutdowns and startups caused by internal either recycled or reused. system error and external disturbance on the electricity grid. • The percentage of water recycled is derived from total treated wastewater.

(Change in wastewater recycled (compared to 2015) 7% 21% as compared to 2015)

YTL PowerSeraya ('000,000 m3) YTL PowerSeraya Total Water Treated and Recycled HU

FY2020 3.6 44 MAN FY2020 1,998 C

FY2019 3.4 65 APITAL FY2019 1,976

FY2018 FY2018 2,023 3.2 85 Total treated water ('000 m3) Water recycled (%)

• The marginal increase in water consumption is mainly due to an increase in high • Total treated wastewater declined by 24% in FY2020 compared to the previous pressure steam sold to customers in FY2020 compared to the last financial year. year due to a drop in electricity use and high pressure steam production. SOC

• Percentage of water recycled is derived from total water consumption. IAL AND RELATI

33% (compared to 2015) O N S HIP SGREIT ('000 m3) SGREIT – Wisma Atria NEWater Utilisation ('000 m3) C APITAL FY2020 227 59 50 FY2020 30 FY2019 365 75 52 FY2019 29 FY2018 353 68 49 FY2018 25

Malaysia Singapore Australia FINAN C

• In FY2020, the total water consumption in our Singapore, Australia and Malaysia • NEWater is a high-grade reclaimed water that has gone through a series of IAL properties was 29.9% lower than the previous financial year, mainly attributed high-tech filtration processes, making it extremely safe to be used as a potable C to the partial opening of malls in Singapore due to the Circuit Breaker and the and non-potable water. APITA partial closure of The Starhill during its asset enhancement. • At Wisma Atria, utilisation of NEWater continues to increase in FY2020. NEWater • In Malaysia, both malls were closed during the MCO while in Australia, a handful L usage has expanded progressively over the years since 2008 to include of tenants were closed at the height of the pandemic in FY2020. Total non-essential areas such as taps for AHU rooms, the bin centre and ad-hoc consumption remained below the level seen when they first embarked on their sustainability journey in FY2017. cleaning for areas such as the façade. • For the coming years, SGREIT targets to review and look into areas it can improve on in its water usage across properties to maintain its water efficiency and conservation. 45 YTL GROUP

Protection of the Environment

WATER EFFICIENCY AND CONSERVATION

We are committed to the sustainable use of water in all our business operations through constant improvement and optimisation of water conservation and water efficient efforts. Amongst the initiatives are rainwater harvesting, use of water efficient fittings, exploring alternative ways to process clean water and through recycling water from operations, as well as protecting our water sources from contamination and pollution.

YTL Group’s Water Efficiency and Reduction Initiatives

Malaysia Indonesia

E-MAS, YTL Construction & YTL Cement YTL Jawa Timur

• Rainwater harvesting for trains, trucks Water Conservation Programme – Water and vehicle cleaning Recycling, Water Reuse and Water Reduction initiatives. More details can be found on page Adoption of ISO 14001 YTL Hotels, SGREIT – Lot 10 & The Starhill 47. Environmental Management Systems • Rainwater harvesting for landscaping and irrigation purposes Australia • Use of low flow fixtures including shower Promoting water saving, heads, water taps and smart controllers Brisbane Marriott Hotel reuse and recycling at all YTL Hotels properties practices Replaced all bathroom tapware and shower fittings in guest rooms Singapore Conducting routine Impact: checks for consumption, YTL PowerSeraya leakage and/or pollution • 14 litres of water consumption reduced • 83.2% of power plant’s water needs met for each shower taken by its in-house desalination plant and • Lessened the need for maintenance due Incorporating water close to 16.3% met from reclaimed water to failed fittings efficient fittings (i.e. NEWater) • Reduced water use from nine litres to and fixtures 6.5 litres per minute SGREIT – Wisma Atria Sydney Harbour Marriott Hotel • Installation of waterless urinal systems Installing wastewater • Adopted Water Efficiency Management Water assessment and benchmarking to map treatment systems Plan (WEMP), which involved the use of out water saving opportunities and installation private water meters as mandated by of water flow restrictors at common areas Singapore Public Utilities Board (PUB) and guest rooms Rainwater harvesting • Discouraged excessive use of water for washing activities through Water Efficiency Labelling Target: and landscaping Scheme (WELS) rated fittings • Zero increase in potable water use

Impact: Optimisation of • 4.6 million litres annual water savings cooling towers

46 SUSTAINABILITY REPORT 2020

Protection of the Environment

YTL Jawa Timur - Water Conservation Programme

Indonesia O VERVIEW

In Indonesia, YTLJT initiated the Water Conservation Programme in 2019, aiming to reduce the amount of service water, potable water and demineralised water used within the Paiton II Power Plant. The management formed a Work Improvement Team (WIT) to conduct research on the water flow process in the power plant, subsequently formulating a strategy to enhance water efficiency.

Target:

• 50% water usage reduction in 2020

• “Zero Wastewater Discharge” NATURAL CAPITAL from WWTP in 2025

Performance:

• 32.7% reduction in water consumption as compared to base year in 2009 • 63% WWTP effluent recycled in FY2020

Effluent is processed and recycled at YTLJT’s treatment plant HU

Water Reuse MAN C

• Reuse of oil cooler cooling water in main cooling APITAL water pump • Reuse of WWTP effluent as submerged scraper Water Recycling chain conveyor make-up and cleaning water • Recycle rinsed water from mixed bed resin • Reuse of WWTP effluent for ash disposal regeneration process area • Recycle feed water from sampling SOC • Reuse of WWTP effluent for dust panel through reverse osmosis IAL AND RELATI suppression system at coal stockpile • Recycle monsoon rainwater to be area processed as WWTP effluent and • Installation of new ultra-filtration subsequently used as service

unit to increase the amount of O water tank N S

WWTP effluent utilisation HIP

• Reuse rainwater from ash C APITAL lagoon for plant usage FINAN

Other Water Reduction Initiatives C IAL

• Modification of chain spray system from open system to closed system C APITA • Reduction of sealing water vacuum condenser loss

• Speed up start-up time with degassed cation conductivity L • Control of ammonia impurities in the cycle chemistry control

47 YTL GROUP

Protection of the Environment

Wessex Water – Environmental Stewardship

United Kingdom

Wessex Water is dedicated to protecting and improving the environment – its treatment works remove thousands of tonnes of polluting material every year and its continued investment in upgrading treatment has been a major factor in raising river water quality standards across the region. The region contains many of the UK’s finest rivers and streams and the company is focused on working with stakeholders in continuing to protect and improve water quality and biodiversity.

Catchment-based Approaches

Wessex Water pioneered the use of catchment-based approaches to deliver sustainable, cost effective solutions by dealing with the source of pollution, not just the symptoms. The company is currently working with the farmers at 21 sites across its region to deliver bespoke, sustainable solutions. In addition to being rated as an industry-leading performer by the UK Environment Agency, Wessex Water has maintained 100% compliance with its abstraction licenses, the requirements of biosolid treatment and disposal, and delivery of the National Environment Programme.

Target: 44 tonnes phosphorus reduction per year

Impact: 54 tonnes per year of phosphorus reduction in the Bristol Avon location as part of the UK’s first catchment permitting trial Wessex Water works with local farmers to deliver sustainable solutions to protect water catchment areas

Wessex Water Marketplace

The innovative Wessex Water Marketplace provides a transparent mechanism for bringing new ideas and solutions to tackle problems they face. It has already helped the company find new approaches for using data to reduce unnecessary overflows in the sewer network and to help in detecting leaks from supply pipes.

Water Resources and Leakage

The final water resource management plan was accepted by Defra and published in August 2019. The plan sets out how Wessex Water will maintain a balance between supply and demand while protecting the environment for the next 25 years. This includes its commitment to reduce leakage levels by 15% over the next five years. In the current year, Wessex Water reduced leakages to 61.4 Ml/d, beating the target and also meeting its target of fixing 90% of leaks reported Wessex Water sends out inspectors to identify leaks in sewer pipes to them on the same day.

48 SUSTAINABILITY REPORT 2020

Protection of the Environment

Sewer Surveillance Project O Sewage monitoring is being established across the UK as part of VERVIEW an advance warning system to detect new outbreaks of coronavirus. Led by the UK Government, this new approach is based on recent research findings showing that fragments of genetic material (RNA) from the virus can be detected in wastewater, which could potentially detect the presence of virus in the population.

During the COVID-19 pandemic, Wessex Water has been working to protect customers while delivering services as normal. Three NATURAL CAPITAL Water Recycling Centre (WRC) sites have been identified for influent monitoring in the Wessex Water region to support the national surveillance programme:

• Avonmouth • Trowbridge • Weymouth

Wessex Water is also supporting the University of Bath with COVID-19 surveillance research by providing influent samples from Avonmouth

(Bristol) and Saltford (Bath) WRCs. The University of Bath’s research HU

is part of a wider academic consortium of UK universities and scientific MAN research institutes. Research developments from the consortium will C APITAL be shared with the national surveillance teams to avoid duplication of work and to share knowledge in this novel field of research.

compliance with abstraction licenses,

100% SOC sludge standards and National Environment Programme outputs IAL AND RELATI

Improving Water Efficiency

Wessex Water is committed to helping customers to reduce their water O N

use. This year, the company has continued to engage with customers S HIP on using water wisely – completed delivery of the Home Check C Programme, visiting customers to fit water saving devices, fixing simple APITAL plumbing leaks and offering tailored behavioural advice. The company also offered the “winter ready home visit” to customers in vulnerable circumstances, where they help to fit lagging or external tap covers, and check for internal leaks. FINAN C

Nearly 11,000 water saving devices deployed IAL C APITA Engaged with more than 13,000 school children L on water efficiency output A customer receiving advice from a Wessex Water employee during Home Check visit

49 EMPOWERING OUR PEOPLE

Our Our Commitment Approach

Recognition of YTL Group as an employer of choice • Creating a harmonious workplace by embracing diversity and providing equal opportunities • Nurturing human capital and bridging gaps through talent development • Caring for employees through active engagement and encouraging healthy work-life balance • Fostering a strong and positive culture of health, safety and well-being Aligned To YTL GROUP Empowering Our People [GRI 102-8, 201-3, 202-2, 401-1, 401-2, 401-3, 402-1, 403-1, 403-4, 403-5, 403-9, 404-1, 404-2, 404-3, 405-1, 408-1, 409-1]

YTL Group regards our employees as our greatest asset and they PERFORMANCE HIGHLIGHTS are instrumental in driving sustainable growth as well as ensuring the success of all our business operations. We remain committed to 32% Females in Leadership Role providing an engaging and conducive workplace for our people even in the economic uncertainty caused by the COVID-19 pandemic. Zero incidents on discrimination, forced labour At the time this report was prepared, we had 13,306 employees or child labour globally, of which 87% are permanent employees. 71% of our workforce is male which is reflective of the nature of our business activities, Providing job training and work opportunities for especially in the cement manufacturing, construction and utility sectors. 75 people with disabilities (PWD)

We recognise that our employees’ effort and commitment are critical factors that will enable us to operate with a high level of competency Zero fatalities in delivering of our goals and targets.

YTL GROUP WORKFORCE DASHBOARD 13,306 87% 90% 29% Total Workforce Permanent Employees Local Workforce Female Workforce

Board of Directors Profile Employee Ethnicity and Nationality Profile

Ethnicity 29% 20% 9% 42% 3 3 (25%) (25%) Nationality 53% 47%

Bumiputra Indian Malaysian Gender Profile Age Profile Chinese Others Non-Malaysian Male Female 50-59 60-69

9 9 Employee New Hires and Turnover Profile (75%) (75%) New hires 794 573

Turnover 1,026 703

84% Locally hired Male Female

Employee Gender Profile Employee Age Profile 3% Top Management 68% 32% 20% 24% 31% 22% (429) Senior/Middle Management 71% 29% 11% 27% 33% 23% 6% (1,995) Executive 67% 33% 20% 31% 26% 20% 3% (3,015)

73% 27% Non-Executive 34% 28% 19% 15% 4% (7,867)

Male Female <30 40-49 >60 30-39 50-59

52 SUSTAINABILITY REPORT 2020

Empowering Our People

DIVERSITY AND EQUAL OPPORTUNITY with any external bodies/entities, so long as it does not jeopardise the company's reputation, represent a conflict of interest and/or hinder their performance at work.

OUR GOAL: O VERVIEW To embrace diversity and inclusion across our workplace We established Corporate Statement on Human Rights and Ethics and offer equal opportunity for advancement as well as Code of Conduct and Business Ethics, which set out acceptable practices and ethics that guide our employees to understand their responsibilities in all business dealings. Both are made available The globalisation of markets has forced change in the demographics and easily accessible on our corporate website8. During the reporting of the global workforce. Adopting the United Nations Global Compact period, we are pleased to report that we have had no incidents in (UNGC) principles of human rights and labour practices, YTL Group relation to discrimination, forced labour or child labour. remains committed to inculcating diversity and equal opportunity in our workplace which allows us to gain a competitive edge through We embrace disability inclusion and promote “a life without barriers” NAT embracing workforce diversity as well as providing fair treatment to by providing job opportunities to people with disabilities (PWD). To- U all our employees to promote improved morale and loyalty. We do date, we have employed 75 PWD and have provided various support RAL for them to facilitate their day-to-day work, helping them to gain not tolerate any form of child or forced labour and we take extra C APITAL precautions to prevent this from happening in all our businesses and self-confidence and overcome any potential barriers in their life supply chains. We do not prevent our employees from being associated whether physical and/or emotional.

YTL Group Supporting Women in Construction, Engineering and Rail Industry

I was given the chance to help out with project development and project management at our power plant and HUMAN CAPITAL cement plant projects. To me, working on site was very interesting because it is very different from working at the office. Some people would say engineering is a man’s job but who cares about that anymore, just be yourself. We are all here to work and all of us have the same target, which is to complete our work. Other than that, nothing should bother us.” Tan Siew Ling Senior Engineer at YTL Construction

SOC

All jobs have challenges. In this line, we have got to do the same job as men. As a train driver, the responsibility IAL AND RELATI of maintaining the train is ours; if there is a problem at the main line, for example, we have to work out a solution and settle the problem. Sometimes, a random passenger would ask me ‘boleh ke bawa’ (can you drive this train?) and I would always answer ‘insya Allah’ (God-willing) with a smile. If you want to

enter this line of work, you have to physically and mentally prepare yourself. Although the train drivers here O N

are mostly male, well, if I can do it, you can too!” S HIP Nurasyiqin Josni C Train Driver at Express Rail Link APITAL

I am responsible for looking at large and small schemes and making sure we have a successful project. I enjoyed the sense of achievement from seeing a project as a dot on a plan to a major construction scheme.

It is important to celebrate any diversity, including a proportion of females in a male-dominated industry. FINAN This is so because the more personalities and perspectives, the better the industry will be. My advice C would be anything that you want to do, you can do it. You just need to want it enough.” IAL C

Lucy George APITA Assistant Project Manager at Wessex Water L

8 Please view our Corporate Statements at www.ytl.com/sustainability/corporatestatement.asp and Code of Conduct and Business Ethics at www.ytl.com/governance.asp

53 YTL GROUP

Empowering Our People

Malaysia

Launched in 2015, Women at YTL (W@Y) is YTL Group’s women’s network aimed to empower and support women across the organisation to grow and reach their full potential. In conjunction with International Women’s Day on 8 March annually, W@Y organised the first of its kind all-day event which was attended by approximately 200 attendees, where women of YTL Group were celebrated and pampered with relaxing, rejuvenating and fun activities. The event was a three-part event whereby attendees were given the option to attend all or their preferred sessions. The event provided an enjoyable opportunity for women in the YTL Group to connect and share their stories and experiences.

The first session was a breakfast talk at the Ritz Carlton Kuala Lumpur and an Executive Chairman of YTL Corporation, Tan Sri Dato’ (Dr) Francis Yeoh giving interview with Puan Sri Sherina Leong-Aris, an Educationalist, Consultant and the opening address, with some words of encouragement to the participants Trainer whose life story inspired attendees and geared them up for the work and sharing the importance of the role of women in the organisation day ahead

The second session, “Bringing Out the Best in You” conducted by Kate Millest, a professional actress and experienced presenter aimed to empower women to The third session was a relaxing one where attendees were treated to a scrumptious voice their opinions and embrace their fears as female leaders in the corporate spread by Cantina, a massage session by YTL Hotels spa, a bath salt making session world with Mangoesteen, ice cream, fun games as well as a karaoke session and more

Singapore

Guided by TAFEP’s (Tripartite Alliance of Fair and Progressive Employment Practices) principle of Fair Employment Practices, YTL PowerSeraya promotes inclusiveness in the workplace, embracing diversity amongst different races, gender, background and nationalities. The company also ensures that employees are compensated based on their skills and experience, as well as their performance and the industry value of the position they hold. To ensure a fair and inclusive work environment, a merit-based compensation system helps to track and minimise gender pay gaps. As at FY2020, the ratio of base salary (Male: Female) for the entire company stood at 1:0.79. This compares well with Singapore’s Wage Equality Score of 0.809.

9 Source: Singapore’s Global Gender Gap score in wage equality from 2011 to 2020 www.statista.com/statistics/972978/global-gender-gap-score-wage-equality-singapore/

54 SUSTAINABILITY REPORT 2020

Empowering Our People

NURTURING HUMAN CAPITAL United Kingdom

Wessex Water launched their culture, inclusion and diversity vision, OUR GOAL: O

‘Everybody Belongs’, with the aim to diversify their workforce and To elicit the right fit for our people to grow and develop VERVIEW reflect the diversity of the communities it serves. A working group their careers with us of 17 employees was set up to focus on providing manager training, supporting working families and enhancing recruitment activities. At the same time, the work of Wessex Water’s early careers team also We aspire to attract and retain the right people, as well as develop helped to increase the company’s socio-economic diversity and female and nurture a highly capable workforce by equipping our people with representation in engineering and construction. skills and knowledge through continuous training and employee development. The following data represents Wessex Water’s gender pay gap figures as of 5 April 2020. It should be noted that the gender pay gap is NAT

different to equal pay, the right for men and women to be paid the U RAL same rate of pay for doing work that is of equal value. C APITAL

Gender Pay Gap 2018 2019 2020

Mean10 5.4% 4.9% 4.8%

Median11 1.5% 4.6% 5.7%

Wessex Water’s gender pay gap is significantly lower than the latest We strive to provide a balance between fun and productivity in our working

UK national average of 17.3%12. This reflects gender distribution in HUMAN CAPITAL environment to ensure our employees experience job satisfaction while growing job roles across Wessex Water’s workforce rather than any equal pay their career with us issues. Wessex Water has a robust job evaluation process and operates a framework of grades and pay ranges within each grade to ensure Employee Benefits and Welfare that the pay is not influenced by gender. At YTL Group, we value the contributions of all employees and recognise In common with many businesses with a predominance of STEM good performance. We provide fair remuneration packages and benefits (Science, Technology, Engineering and Mathematics) skills, the water to our employees to drive high levels of performance that helps

industry is heavily male dominated. Wessex Water recognises that maintain our industry-leading position. Some of our business units SOC diversity is a strength and continues to create a diverse and inclusive also provide the same benefits to temporary or part-time employees IAL AND RELATI environment to improve the representation of women within their as we believe their basic welfare should also be taken care of. business and the industry. YTL Group conducts annual performance appraisals to provide our The following are the current areas of focus which will contribute people with feedback on their performance and accomplishments O N

to reducing Wessex Water’s gender pay gap over time: for the previous year. We communicate with our employees to S understand their development needs and career plans. Key performance HIP

• Reflecting the diversity of the communities they serve; C indicators (KPI), both for the business as well as for employee APITAL • Community education; development, are in place to ensure that performance goals are • Apprenticeships, graduates and early careers; aligned with our business objectives. • Promoting and encouraging flexible working; • Improving all forms of diversity and inclusion at all levels. In the event of termination or employee resignation, a minimum notice period of one to three months needs to be fulfilled, depending FINAN on the employee’s job grade and operational requirements. C IAL In FY2020, 184 female employees went on maternity leave and 101 C male employees took paternity leave. 242 returned to work, resulting APITA in an overall retention rate of 85%. L

10 The mean gender pay gap is the difference in average hourly pay for men compared to women at all levels across Wessex Water 11 The median represents the midpoint across a list of values in numerical order. If we list the average hourly pay in numerical order, the median is the middle number. The median pay gap is the percentage difference in average hourly pay for the middle man compared to the middle woman across Wessex Water 12 Source: Office for National Statistics (ONS) median pay gap 2019 55 YTL GROUP

Empowering Our People

Employee Remuneration and Rewards Programme

Annual Leave Entitlement Uniform and Equipment Allowances Employee Share Options Schemes Medical Coverage and Group Insurance Plans Mobile Phone and Internet Plan Various Types of Vendor Vouchers Learning and Developing Opportunities Study Assistance Sport and Fitness Activities Flexible Working Hours Birthday Leave Parental Leave Note: Certain benefit entitlements are only applicable to selected business units

Training and Development

YTL Group places an emphasis on upskilling our people by investing in training, workshops and seminars that can equip our people to enhance their skill in current roles, navigating organisational ladders, as well as gaining personal insights into their strengths and development needs. We have a set of strategies and tools to help our people in their career development and to provide avenues in identifying their career goals whilst fulfilling the company's mission. This year, we continue to focus on conducting in-house and/or online training which is more cost- efficient and has better time flexibility. Training and Development Programmes across YTL Group

ISO 22000 Food Safety Management Systems Dual Task Programme Public Announcement Training Programme Training

Held by ERL Maintenance Support (E-MAS) to train Jointly held by Express Rail Link (ERL) and E-MAS to Conducted by Cameron Highlands Resort to educate Operations Train Driver (OTD) to carry out tasks as improve Ground Operation Employee’s (GOE) skills in employees on safety and food hygiene environment Operations Station Supervisor (OSS) as and when making public announcements properly and relating to ISO 22000. required to eliminate the manpower gap and as an professional manner. additional career development path for train drivers. Outcome: Outcome: 70 employees mainly from the kitchen as well as Outcome: 99 GOE attended training; 96 passed the training. food and beverage departments were involved in 16 OTD involved; 14 promoted to OSS. Minimal complaints from passengers of poor or no the training. announcements reported.

YTL Cement utilised online video Introduced by YTL Construction during conferencing platforms to host trainings the MCO online classes consisted of a to upskill and enhance the technical series of free online training for knowledge of employees during the employees to learn, upskill themselves Movement Control Order (MCO). as well as allowing employees to connect with one another while everyone was Outcome: working from home. A total of 14 technical training on various topics were held by internal Outcome: and external trainers involving a total 44 training sessions conducted Online Learning Platform of 1,500 participants. YTL Learning Academy throughout the MCO.

56 SUSTAINABILITY REPORT 2020

Empowering Our People O VERVIEW NAT U RAL C APITAL ISO 50001 Energy Management Systems Training Balancing and Total Alignment Training

Conducted by YTL Jawa Timur (YTLJT) to provide employees with insights on An in-house training programme by YTLJT to provide employees with an overview establishing, implementing, maintaining and improving an Energy Management and hands-on exercises on shaft alignment, soft foot correction, dial-indicator and System with reference to ISO 50001. laser alignment methods which could enhance the efficiency and lifespan of machines and components. Outcome: 20 employees were involved in the three-day course. Outcome: Ten employees were involved in the training. HUMAN CAPITAL SOC IAL AND RELATI O N S Executive Development Programme Leadership and Management Programmes English Learning Mobile Application HIP C

Conducted by YTL Starhill Global REIT Management Launched by Wessex Water in partnership with Introduced by The Surin Phuket, English topics are APITAL (YSGRM) to nurture high-performing business unit Weston College, currently being reviewed to create divided into several sections where employees from leaders by providing them with additional knowledge a blended learning approach to training by using different operating teams can access the lessons and experience through training, workshops and more e-learning content through the iLearn platform. relevant to their operations. seminars on management, technical skills, communication, leadership and other topics. Outcome: Outcome: Wessex Water delivered 600 courses with an average Employees improved their English language proficiency FINAN Outcome: of 2.7 days’ development training per employee. and built confidence to communicate in English. In FY2020, each employee underwent an average Wessex Water also created new ways of alerting C

of 20.9 hours of training, bringing the total average employees to changes in risk assessments or health IAL

training hours per employee over the three-year and safety updates, with the ability to test their C APITA period from the base year of FY2018 for this target comprehension through iLearn. to 84.9 hours. This exceeds the target of 75 hours L of training hours per employee over three years.

57 YTL GROUP

Empowering Our People

Grooming Future Talent

Nurturing and retaining talented employees is our utmost priority. We offer internship and apprentice programmes to equip our future leaders with extensive industry knowledge as well as hands-on experience to gain real-life work exposure under the guidance of their mentors and/ or supervisors. Today, we have a robust young talent pool, comprising interns, apprentices, scholars and management trainees.

Number of Interns

FY2018 FY2019 FY2020 Male Female Male Female Male Female 198 199 217 263 190 235

Internship and Apprentice Programmes across YTL Group

Internship Opportunities in Rail Integrated Internship Programme (IIP) Work Experience Opportunities Widened Talent Recruitment

ERL provides internship opportunities to YTL Construction extended internship Wessex Water introduced a structured Wessex Water utilises Higher Education learn about ERL operations as well as opportunities to international students work experience programme following Statistics Agency (HESA) data to identify working experience in a professional from Japan via IIP to promote cultural one of three pathways: Construction and appropriate universities based on the area environment. Individuals who have diversity and strengthen bilateral relations Engineering, Science and the Environment, of study, gender split and ethnicity to completed the Industrial Trainee between Japan and Malaysia. and Corporate Business to students. target Wessex Water’s recruitment. Programme may be considered for permanent positions in ERL. Outcome: Outcome: Outcome: YTL Construction hosted three Japanese Delivered week-long work experience Widened the talent recruitment exercise Outcome: interns, and their employees gained a placements to 34 students, 24% of whom to cover an additional 20 universities and In FY2020, a total of 15 interns have been better understanding of Japanese culture. were female. three local institutes. recruited and gained working experience As a result, YTL Construction received in rail sector. more requests for IIP and improved public perception of YTL Group amongst universities in Japan.

Wessex Water – Hiring People from Disadvantaged Backgrounds

Wessex Water committed to the UK Government’s Social Mobility Pledge which aims to inspire, attract and recruit from disadvantaged backgrounds. To support this, Wessex Water is now recognised as a Cornerstone Employer for the Careers and Enterprise Company, which will bring attention to the social mobility and opportunity area of Minehead and Taunton in the West of Somerset. Of Wessex Water apprentices starting this year, 10% are from government recognised disadvantaged postcodes. Wessex Water early careers team continues to develop holistic people and employability skills in all their apprentices. Of the 350 applicants for Wessex Water technical apprenticeship roles, 10% are female; which is above the national average for engineering and construction-based apprenticeship applications. Helping Young Job Seekers Wessex Water career development apprenticeship Wessex Water technical apprentices’ social characteristics: Brisbane Marriott Hotel provides four weeks programmes continue to grow with more than 60 of unpaid internship to underprivileged, 15% are young parents; young job seekers who have been employees, many of whom have no formal unemployed for six months. A paid part-time qualifications, now studying at advanced levels. With 10% declared mental health issues; position is offered if they demonstrate 5% have additional learning needs; positive attitude and potential. around 157 apprentices, Wessex Water programmes remain successful, and they have maintained their 7% are from black and minority ethnic Outcome: undergraduate placement numbers with around ten backgrounds; Since its inception in mid-2019, four young job seekers have been recruited for the within the business this year. Across their Early 10% reside in government recognised programme and one of them was offered Careers Programmes, 18% are female. disadvantaged postcodes. a paid part-time position.

58 SUSTAINABILITY REPORT 2020

Empowering Our People

ENGAGING OUR PEOPLE

OUR GOAL: O

To bridge the gap leading to increased employee satisfaction and motivation VERVIEW

At YTL Group, we aim to enhance the strength of mental and emotional connections of our people with their places of work. We engage with our people through various avenues to ensure an effective flow of information as well as connecting them with the core values of YTL Group. We have an open-door policy which allows our people to raise their problems or concerns relating to their work, harassment, grievance handling and whistle-blowing to superiors, heads of department, higher management or to the HR Department. We view all types of employee feedback mechanisms across YTL Group as essential in creating effective communication channels.

We actively engage our employees through various avenues, including the annual YTL Leadership Conference, town halls, Monday Memos, YTL NAT

Community and BTRT websites, engagement surveys and YTL Group Sustainability Committee for effective flow of information and updates, U RAL alignment of business goals and objectives, as well as stories and interviews with management and employees across all levels of YTL Group. C APITAL Employee Engagement Programmes across YTL Group HUMAN CAPITAL Volunteer for Water Access Programme (WAP)

Three volunteer employees from YTLJT Wessex Water Force (WWF) were involved in the implementation of WAP for local communities. More details Launched in April 2018, WWF is the Long Service Awards can be found in the “Community” volunteering programme for which section on page 79. Wessex Water employees can use one One of E-MAS practices to motivate and retain loyal employees by giving a working day per year to work with certificate and token of appreciation to those with more than ten years’ service. Outcome: local charities across the region. More than 270 volunteering hours SOC Outcome: spent in the field survey, technical Outcome:

13 recipients of E-MAS’ Long Service Awards: seven for ten-year category, five for preparation and construction work of More than 500 employees gave up IAL AND RELATI 15-year category and one for 20-year category. hydram pump units (including pipelines their time to lend a helping hand to and water storage) of WAP. good causes, volunteering for a combined total of 3,188 hours and taking part in more than 50 activities. O N S HIP C APITAL Celebrating Festive Seasons #YTLBiggie 3.0 Together Team Bonding Activities Community Champions Programme An idea contest to raise awareness Food and grocery distribution initiatives YSGRM organised several team- on sustainability-related issues and by YTL Construction to employees and building activities, lunch talks and Initiated by Wessex Water to support to reward concepts based on how workers of their sub-contractors as a workshops such as tang yuan cooking and encourage employees who wish they can be implemented in YTL token of appreciation for their hard class in conjunction with the Mid- to represent the company and become Group’s operations or management. work and as a celebratory gifts. Autumn Festival and catamaran cruise more involved in their local communities FINAN The theme for 2019 was “Free Plastic? incentive outing as well as educational across the region.

Plastic Free!”. Outcome: talks on first aid and survival skills C IAL With the support of The Majestic Hotel crucial in the event of terrorism or a Outcome:

Outcome: Wessex Water champions represent the C

Kuala Lumpur, the food distribution fire. Employees also celebrated festive APITA The winning idea was “Mej Cycle” by initiative benefitted 1,900 employees events together as part of building company in local communities; becoming Chin Kit Joy and Melissa Sin Wei Qi. Mej and their families during the month of an engaging culture in YSGRM. a point of contact for the community, Cycle is a circular economy system that Ramadhan. Additionally, the grocery but also being able to spot opportunities L aims to prevent the build-up of distribution benefitted 2,934 sub- Outcome: where they can step in to help. Some of detrimental plastic by replacing contractors working on the Gemas-Johor Wessex Water’s current champions sit conventional plastic with a biodegradable Bahru Electrified Double Track Project Forged stronger bonds between on funding committees, deciding where bioplastic made from sago starch. (EDTP) during Hari Raya. employees and encouraged more grants and donations are allocated and healthy lifestyles. help identify volunteering opportunities.

59 YTL GROUP

Empowering Our People

LEAD Conference 2019

The annual YTL Leadership Conference, now known as the LEAD Conference, is a series of keynotes, workshops and seminars designed to bring leaders in the YTL Group close to experts across a breadth of industries to learn, discover and be challenged. Centered on the theme “Lead, Educate, Aspire, Discover”, LEAD Conference is also an avenue for key senior managers and leaders across all business units to present progress on their respective projects or business units as well as to exchange thought-leadership matters. Four pop-up

booths were set up to expose leaders with activities relevant to each of the respective Lead – To allow YTL Leaders to discover their inner themes. In 2019, over 600 YTL Leaders from Malaysia and overseas attended the LEAD personalities based on Myers and Briggs’ 16 Conference. personality types

The keynote sessions consisted of carefully selected speakers, each with an abundance of experience in their respective fields. A spectrum of engaging topics was shared with the audience to bring light to refreshing perspectives that could help the leaders widen their outlook and innovation. This was further supported with seminars and workshops led by YTL Directors and industry experts to share some personal experiences and tools of Educate – To raise awareness on the importance their trades. of good health amongst YTL Leaders. This was done in collaboration with Avisena Specialist Hospital who During the LEAD Conference, the annual BTRT Awards were presented to five candidates. provided free health screening and dietary advice Introduced in September 2016, BTRT Awards is an appreciation of the exemplary individuals and/or teams who embody the YTL brand values, and go beyond the call of duty for the company and its people.

Aspire – To inspire YTL Leaders to aspire to be genuine brand ambassadors by quizzing their knowledge of YTL Group's history, branding, and vision

Discover – To expose YTL Leaders to the concept of urban farming along with the importance of food security and the greening of surroundings

A total of 244 nominations were received over a two-month online campaign and four candidates and one team were chosen by the BTRT Awards committee. Winners were presented the BTRT Light Brick trophy by Executive Chairman, Tan Sri Dato’ (Dr) Event highlights Francis Yeoh on stage during LEAD Conference 2019

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Empowering Our People

MANAGING WORKPLACE HEALTH, SAFETY AND Health, Safety and Security Training and Communication WELL-BEING We constantly review our safety and security action plans, accident and/or incident reporting procedures as well as relevant training O

OUR GOAL: programmes and materials to keep up with changes in equipment, VERVIEW To improve workplace health and safety towards zero materials, and safety standards within the business. As such, we fatalities and accidents conduct workplace safety training on a regular basis for employees, workers and contractors to ensure they are well-equipped with the knowledge to identify hazards, report them, and deal with incidents. Managing workplace health, safety and well-being has always been a We also promote the wellness of our employees through programmes priority in YTL Group. It is crucial to ensure a healthy and safe working that address physical and mental health-related risks. environment for our people and customers, as well as suppliers and contractors. Our company-wide safety policy ensures that there is Promotion of Employee Health, Safety and Well-being complete awareness with regards to safety across all our operations. NAT U RAL As guided by our Corporate Statement on commitments to health and

Free annual health screening C safety, most of our key business units are certified with ISO 45001/ APITAL OHSAS 18001 Occupational Health and Safety Management Systems and in compliance with applicable regulatory requirements. Cardiopulmonary resuscitation and first aid Occupational Health and Safety

With our target of zero accidents in all business units, we regularly monitor, review and optimise our health and safety practices to Emergency preparedness and response

minimise the occurrence of accidents in our business operations. All HUMAN CAPITAL performance against health, safety and welfare is closely monitored by the Workplace Safety and Health (WSH) Committees of each business unit and reported to top management. The WSH Committee Firefighting and evacuation comprising representatives from different departments as well as an employee union representative, meet on a monthly basis to discuss Health and fitness lunch-talks on stress management, and ensure policies and management systems are adhered to and understanding dementia, prevention of flu, measles that safety standards across operations are aligned. Permit-to-work and chronic diseases, nutrition, etc.

systems, regular safety audits and inspections as well as the SOC

maintenance of fire detection and protection systems help to keep IAL AND RELATI the workplace safe. During the year under review, there were no Training and communication on Health, Safety and incidents resulting in fatalities. Environment (HSE) policies as well as operating procedure

Sports and recreation activities including badminton, O N S

futsal, bowling, Zumba, yoga, etc. HIP C Commitment Communication APITAL Commitment-based Effective safety approach to safety communication of In order to cope with the COVID-19 pandemic, we have geared up management downward information our standard operating procedures and appropriate measures in all and upward regions in a timely manner which include physical distancing, the use Zero communication of face masks and/or face shields, frequent hand washing as well

Fatality FINAN Strategy as the use of gloves when necessary as preventive measures to

minimise the risk of our people being exposed to infection whilst at C IAL work. Information on pandemic planning, medical and travel advisories C Culture Learning are also made available for all employees through HR blasts and the APITA Open atmosphere for Collective learning weekly Monday Memo. communication on safety through experience from L grounds and well informed actual incidents and on safety requirements precautionary safety trainings

61 YTL GROUP

Empowering Our People

Occupational Health and Safety Management Data Indonesia

YTL Jawa Timur Accident frequency rate Accident Frequency Rate (AFR) is the measure of number of workplace accidents per million man-hours worked in YTLJT’s operations in FY2020 0.30 Indonesia. The AFR increased by 7% in FY2020 due to the lower total man-hours worked as a result of the higher number of power FY2019 0.28 outage sessions. FY2018 0 0.00 0.10 0.20 0.30 Singapore

YTL PowerSeraya Accident frequency rate YTL PowerSeraya’s AFR data covers operations of both Pulau Seraya Power Station and Jurong Power Station. There were no workplace FY2020 0 accidents in FY2020. FY2019 2.10

FY2018 3.00 0.00 1.00 2.00 3.00 United Kingdom

Wessex Water Incidents of near misses and service strikes All incident 2019 227 There were 571 incidents reported in 2019, including 126 near misses and 101 service strikes. The principal cause of all incidents after near 2018 266 misses and service strikes remains slips, trips and falls. This is in line 2017 with other companies, other industries and the national average. 252 0 100 200 300

Reportable incident rate Reportable incident rate per 1,000 employees This is the measure of the number of reportable incidents per 1,000 employees. There were 4.1 incidents per 1,000 employees, which 2019 4.10 still falls below the company’s target. 2018 4.00

2017 5.04

0246

Lost time incident rate Lost time incident rate per 1,000 employees This includes all reported incidents involving employees that resulted in absence from work of one or more days. In 2019 there were 34 lost 2019 13.35 time incidents, a slight increase of 6% from 2018. The principal causes of lost time in 2019 were slips, trips and falls, and manual handling. 2018 14.24

2017 12.82

0 5 10 15

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Empowering Our People

Health and Safety Training Programmes across YTL Group O VERVIEW NAT U

Ergonomics at the Workplace and Manual Handling Training Enhancing Train Window/Windscreen Storage Safety RAL

Training by E-MAS to provide understanding and enabling employees to identify E-MAS found that the previous method used to store train windows/windscreens C APITAL ergonomic hazards related to their activities and control measures to be taken. was improper as two units of train windows/windscreens were found cracked It is organised by the Safety and Security Department with the involvement of at the storage location. Following completion of the train’s window and windscreen all levels of employees with the aim to increase work quality, productivity and storage enhancement, there were no scrape or damage reported. efficiency. HUMAN CAPITAL

Emergency Response Plan (ERP) SOC

Conducted by E-MAS with the involvement of local government agencies to train and evaluate participants’ readiness and actions during an emergency. Two scenarios IAL AND RELATI of ERP – Building Fire and Train Derailment involving 200 participants were conducted. Both ERPs were well executed, attained the expected results and enhanced awareness and competency of the participants. O N S HIP C APITAL FINAN C

Week of Safety and Health at Work 2020 Loss Prevention Reserved Certification Programme IAL C

Held by SIPP-YTL JV on 4 February 2020, it was organised to promote a healthy Conducted by The Majestic Malacca to create awareness amongst employees on APITA and safe working environment amongst employees as well as to learn and the importance of safety measures and appropriate steps to be taken during an

exchange feedback from Johor’s Department of Occupational Safety and Health emergency. This programme was organised by the Loss Prevention Management L (DOSH) team in terms of health and safety standard operating procedures at team, and 15 employees took the examination all of whom passed. construction areas. Attended by 200 people, this programme included participants from Johor's DOSH team, SIPP-YTL JV employees and crane operators.

63 YTL GROUP

Empowering Our People

ISO 45001 Occupational Health and Safety Training Competent Person Training Paiton Safety Certification

To provide new employees with information about Conducted by YTLJT to provide basic understanding of Conducted by YTLJT to provide a basic understanding YTLJT’s structure and organisation, an introduction to YTLJT safety rules, hazard identification, and risk control of the nature of hazards and inherent risks of a modern the Paiton II Site as well as an overview of ISO 45001 strategies. The training enabled employees to make coal-fired power plant, the role and arrangements for structure. The training also introduced new employees positive contributions in establishing and maintaining risk management as well as requirements and procedures to YTLJT Safety Management System and safety rule a safe place and sound systems. for reporting all incidents. Employees gained a basic standards expected of all employees. understanding of the principles of health and safety management, hazard identification, and risk control strategies at a power plant. Awarded 2020 Zero Accident Award and Golden Flag for Safety Management System by East Java Governor for outstanding HSE performance

Home Office Work Arrangement Safety Case13

Implemented during the Circuit Breaker period in YTL PowerSeraya’s focus in 2020 was to develop a Singapore to enable employees to stay safe and Safety Case to assess their current ability to prevent healthy at home while remaining productive. major accidents and mitigating risks should a major Complimentary online trainings and workshops were accident occur. Over time, YTL PowerSeraya plans extended to employees during the Circuit Breaker to boost the organisation’s capability in addressing period. major accident hazards through the implementation of preventive measures.

bizSAFE is a programme designed to help companies build workplace safety and health capabilities. Workplace Health Programme The programme included SGSecure elements in Organised by YSGRM and consisted of a series of September 2017 to help companies to put in place sports and health-related activities for employees measures to manage potential terror threats. This to stay fit, healthy and productive. Among others, year, YTL PowerSeraya attained bizSAFE Level Star, the Manager organised regular badminton sessions the highest level under the bizSAFE programme for employees in an effort to promote a healthy administered by the Workplace Safety and Health lifestyle amongst employees. These workplace health Council in Singapore. and bonding activities have resulted in a happier, bizSAFE Programme more cohesive and productive workforce.

13 The Safety Case is under Singapore’s Workplace Safety and Health (Major Installations) Regulations

64 SUSTAINABILITY REPORT 2020

Empowering Our People O VERVIEW

Health, Safety and Welfare Strategy NAT U

Wessex Water has a five-year strategy that details RAL

performance measures in four strategic areas to achieve C their target of zero workplace accidents: APITAL i) Strong and visible leadership; ii) Delivery of health, safety and welfare improvements; iii) Safe working environment; Level 30 iv) Communication and worker involvement. 46 associates from Brisbane Marriott Hotel participated in Level 30, a wellness initiative that has teams of Performance against the strategy and each area is associates competing against each other throughout all properties in the world. The initiative enhanced their monitored by the Wessex Water’s health and safety health and well-being as well as the interaction between associates to build better work relationships and management group and reported to the Corporate and

improve the overall hotel culture. HUMAN CAPITAL Social Responsibility committee. SOC IAL AND RELATI O N S HIP C

Awarded the Royal Society for the APITAL Prevention of Accidents (RoSPA) Gold Medal Award. Wessex Water’s continued success at the RoSPA Awards R U OK? Day places Wessex Water in the top three 50 associates from Brisbane Marriott Hotel engaged in activities promoting conversations with others who

construction companies for health and FINAN may not be OK in terms of mental health and wellness. The initiative improved the awareness of associates safety in the world to opening up a simple conversation with others and determine if they are mentally fit to prevent any potential C

self-harm or suicide attempt. IAL C APITA L

65 ENRICHING COMMUNITIES

Our Our Commitment Approach

Positively impacting and enriching the lives of communities • Developing future generations of leaders by providing quality where we operate education and supporting education initiatives • Supporting community groups, social institutions, NGOs, social enterprise and non-profit organisations • Advocating community-based environmental protection • Promoting arts and culture by providing platforms for artistic expression as well as supporting events that promote health and wellness Aligned To YTL GROUP Enriching Communities [GRI 103, 413-1, 413-2]

Over the years, YTL Group has been actively involved in advocating NURTURING EDUCATION causes which matter to the communities where we operate. From financial assistance to educational empowerment, we continue to create positive impacts and effect change in enriching communities and shaping a better OUR GOAL: environment for future generations. In line with our vision of ‘Making To promote 21st century learning approach and technology a Good Future Happen’, we strive to improve the quality of life and well-being of communities focusing on three key pillars: Education, Supporting Communities, as well as Arts and Culture. Education plays a key role in driving sustainable economic growth in communities. At YTL Group, we strive to empower individuals and local communities by building an inclusive culture for education and PERFORMANCE HIGHLIGHTS creating opportunities for knowledge access as we firmly believe that no one should be left behind in education. We constantly invest Education in programmes that contribute to strengthening and improving education standards. • 35 scholarships provided • Over 75,000 children engaged • 326 frog classrooms transformed since 2014 Malaysia • 22,090 education packages distributed YTL Foundation – Enriching Communities through Education

Supporting Communities YTL Foundation believes that education is a key enabler to a better future and has partnered with individuals, non-governmental • Approximately RM16.5 million invested in organisations (NGOs), corporations, social enterprises and government communities benefitting more than 112,000 agencies in its efforts to achieve its vision of building better societies underprivileged people and community groups through better education. • 3,530 volunteering hours

20 scholars were awarded scholarships under the COVID-19 Support YTL Scholarship Programme

• Approximately RM126 million in cash and in-kind donated for COVID-19 relief YTL Foundation Scholar Induction Ceremony

The induction ceremony for last year’s cohort of scholars was held at Arts and Culture Hotel Stripes Kuala Lumpur on 16 August 2019 and provided an opportunity for new scholars and their parents to get to know one another and also • Supported 12 cultural events and wellness programmes for the scholars to meet some of the contemporary and previous YTL Foundation scholars who were also invited to attend the event.

The 2019 cohort of scholars inducted at the ceremony seen here with Dato’ Ahmad Fuaad Bin Mohd. Dahalan, Trustee of YTL Foundation and his wife, Datin Teh Fauziah Binti Ahmad Norizan, Datin Kathleen Chew, Programme Director of YTL Foundation, Puan Sri Sherina Leong-Aris, Educationalist and Tan Sri Datuk Dr. Aris Bin Osman @ Othman, Trustee of YTL Foundation (front row, left to right)

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UK Scholar Training Puan Sri Kai Yong Yeoh Book Prize

St Anne’s College, Oxford was the venue for the United Kingdom The Puan Sri Kai Yong Yeoh Book Prize was established as an incentive (UK) Scholar Training held from 27 to 29 September 2019. These to encourage the children of YTL Group employees to develop and O annual training weekends are usually held at the beginning of the strengthen their talents and skills. The competition aims to cultivate VERVIEW new academic year for scholars in the UK. creativity, critical thinking and problem-solving skills where research essays as well as video submissions are required. It was redesigned in 2019 to make the competition more accessible by introducing a new category for children aged between ten and 14.

A total of USD11,500 NAT in prize money was given to winners U across three categories RAL

With the theme of “Preparing for the World of Work”, the scholars are taught C APITAL the basics of project management, design thinking, how to better understand 1 their own personal resilience and to develop coaching skills 10-14 years 3rd prize: Olivia Iris Lakey (UK)

Coaching Impact 15-17 years say that they have learnt to be goal-oriented after 1 st prize: Grace Alexandria Ong (Malaysia) 91% coaching sessions 2nd prize: Alice Pymer (UK) rd

3 prize: Loh Jia Sheng (Malaysia) HU

say that the scholar sessions have helped them adjust MAN 89% to the new environment and also helped them to organise

18-21 years2 C and manage time APITAL 2nd prize: Tan Jia En, Gracelyn (Singapore) Marco George (Malaysia) say that they understand that attitude and personality 78.5% rd are as important as grades 3 prize: Fathagiro D’Silva (Malaysia)

Note: 1 The inaugural ten to 14-year-old category unfortunately did not receive believe that they need to explore more on problem SOCIAL AND RELATIONSHIP CAPITAL 63% solving and developing mental health many submissions and as a result only third prize was awarded. 2 Whilst there was no first prize winner in the 18 to 21-year-old category, there was a tie for second prize and a winner for third prize.

YTL Foundation Scholars Alumni Network (YTLSAN)

Recently, YTL Foundation started a scholar alumni community to build an engaged and supportive network of past scholars that it believed would bring positive impacts to YTL Group. FINAN C IAL C APITA

On 16 December 2019, about 30 alumni who are now working with various The Puan Sri Kai Yong Yeoh Book Prizes presented to the winners by Dato’ Yeoh L divisions within the Group are seen here attending their first Christmas party to Soo Min, Executive Director of YTL Corporation and Trustee of YTL Foundation celebrate the festive season together with Datin Kathleen Chew, Programme (center) and Tan Sri Datuk Seri Panglima Dr Abu Hassan Bin Othman, Trustee Director of YTL Foundation (center, first row) of YTL Foundation (second from the right) during YTL Foundation Awards Night

69 YTL GROUP

Enriching Communities

54C After-school Educational Programme

Since December 2015, 54C has supported over 620 underprivileged children from 18 community schools and enlisted the help of over 80 volunteer teachers.

54C capping off a fulfilling 2019 with Christmas parties for children who attended the after-school The beginning of 2020 saw art lessons taught by the The children seen here enjoying one of the lessons education programmes at 54C, including children of talented Mr. Azizan who kindly agreed to teach at and creative workshops from some of YTL Foundation’s YTL Group employees 54C after having participated in Lottie’s Cultural Splash scholars undertaking internships at the centre

CLiC After-school Educational Programme

More than 430 children from 23 schools have benefitted from activities available at CLiC conducted by committed teachers and volunteers.

The Creative Learning Information Centre (CLiC) has seen an increase in the number of children in and around the Sentul community participating in the various programmes and workshops held at the centre on a weekly basis. At the beginning of 2020, a Mandarin class for beginners was added to the list of classes available A holiday programme was also organised for the children aged between seven and 12 on 16 at the centre, and class was very popular with students August 2019 where there were activities involving animation and music based on the financial and parents, and is currently the most well-liked literacy programme called “Cha-Ching” as well as interactive science experiments. programme at CLiC

“Ruang KITA” – A Shared Space for All

The joint effort of YTL Foundation, Sentul Raya Sdn Bhd and Dewan Bandaraya Kuala Lumpur (Kuala Lumpur City Hall) as part of a larger initiative called “KEMPEN KITA”, a CSR programme of Sentul Raya Sdn Bhd, impacting 1,425 local families.

Apart from CLiC that is located at Sentul UTC (Urban Transformation Centre), the residents YB Tuan Haji Khalid Abd. Samad, the former Minister of Perumahan Awam Seri Perak in Sentul now have a newly renovated and fully transformed of Federal Territories (second from left) and Dato’ Sri former multipurpose hall called “Ruang KITA” which can be used to host various activities Michael Yeoh Sock Siong, Executive Director of YTL such as nutrition, safety and crime prevention programmes as well as a Toy Libraries Malaysia Corporation (third from left) officially launching “Ruang corner that has various toys and games for children. KITA” on 15 February 2020

Children need basic skills in order for them to learn well at school, and these skills can be acquired in the first 1,000 days of life. Nowadays, children are found to have issues with their gross and fine motor skills, hand-eye coordination and overall motor planning which are important skills before they can learn to read and write. Exposure to a wide range of toys in the early years can improve these skills tremendously. Let's support our children to get a better head-start.” Dr Raihan Toy Libraries Malaysia

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Frog Classroom YTL Foundation Awards Night

For the past two years, YTL Foundation together with FrogAsia has Since 2014, 326 classrooms have been transformed. held the YTL Foundation Awards Night to celebrate all teachers who O are dedicated to transforming education and have made extraordinary VERVIEW One of the newly transformed schools was SMK Seksyen 5 Wangsa contributions in this area. Maju which had one of its classrooms transformed into a 21st century learning space equipped with custom-made tables, chairs and air- The third Awards Night was held at JW Marriott Hotel Kuala Lumpur conditioning units provided by YTL Foundation. The school raised on 22 November 2019 and the Frog Teacher Awards, Tan Sri Yeoh the remaining funds necessary to complete the transformation and Tiong Lay Transformational Teaching Award by TFM, YTL Foundation teachers and students took part in the building process by assembling Schools Awards, Global School Leaders Awards, Frog World the furniture as well as painting and decorating the classroom. Championship as well as the Puan Sri Kai Yong Yeoh Book Prize were

presented to a total of 67 winners. NAT Reimagining Spaces U RAL YTL Foundation also played a role in reimagining spaces at SMK Taman C Ehsan, Kepong by helping to transform one of its classrooms into an APITAL audio-visual room. The idea to have an audio-visual room for the school to encourage the teachers to be more creative was conceived by two fellows from Teach For Malaysia14 (TFM) who at the end of their teaching fellowship at the school wanted to leave a more tangible legacy. YTL Foundation was more than happy to support them.

Sufian Suhaimi, a Malaysian singer and former teacher who won the Best Performer HU

Award at the Anugerah Juara Lagu 2019, performing at YTL Foundation Awards Night MAN C Dialogue Series: Education in An Age of Uncertainty APITAL

More than Over Positive SOCIAL AND RELATIONSHIP CAPITAL 200 viewers 800 views feedback YTL Foundation provided the now familiar custom-made tables and chairs for during the on the Facebook from the viewers the audio-visual classroom seen here at SMK Taman Ehsan, Kepong live stream page recording and speakers

As travel restrictions were imposed by many countries and large gatherings were prohibited by authorities as a result of the COVID-19 A well-designed classroom is a RIGHT, not a LUXURY.’ pandemic, this year’s Dialogue Series originally planned to be hosted This is what we told the people around us when we in Kuala Lumpur with invited speakers from the UK had to be moved started Project Reimagining Spaces. The students finally online and was successfully streamed live on YTL Foundation’s Facebook have a well-designed classroom to enjoy their study page on 12 June 2020. and we also make the students believe that nothing is impossible as long as you put in an effort to make it happen.” Three distinguished professors from the University of Birmingham, UK FINAN Ong Zi Ying namely Julie Allan, Colin Diamond and Kristján Kristjánsson shared their C previously a second year TFM fellow at insights from their respective fields of expertise. Madam Chee Poh IAL C

SMK Taman Ehsan, Kepong and also, one of the Kiem, the Principal of SMK St. Mary, Kuala Lumpur also shared her APITA initiators for Project Reimagining Spaces views from a Malaysian perspective in the panel discussion moderated L by Chan Soon Seng, CEO of TFM.

14 Teach For Malaysia (TFM) is a not-for-profit organisation with the goal of providing equal opportunity to quality education for all Malaysian students by partnering with the Ministry of Education (MOE) to recruit, train and support future leaders who teach as fellows in high need schools across Malaysia. YTL Foundation has been supporting TFM’s efforts since 2012 71 YTL GROUP

Enriching Communities

Acumen Academy Malaysia Pemimpin GSL (formerly known as Global School Leaders Malaysia) Following the launch of the Acumen Fellows Programme by Acumen Academy Malaysia in July 2019 and six months of rigorous recruitment YTL Foundation supports Pemimpin GSL, an organisation that and selection, Malaysia’s first fellowship of social innovators was recognises the importance of school leadership and implements announced in January 2020 consisting of 21 individuals undertaking professional development programmes for school leaders to drive inspiring work impacting society in the areas of environment, high-quality school instruction and a positive culture that leads to agriculture, education, entrepreneurship, mental health, cancer improved student learning. research, digital empowerment, advocacy and journalism. Amongst these individuals were Hartini Zainudin of Yayasan Chow Kit, Ian Yee Initiatives in 2020: from R.AGE, Tharmelinggam Pillai of Undi18, Fariz A. Rani of Inspirize • In collaboration with Google and Arus Academy, the organisation Consulting, Michelle Usman of Usman and Partners as well as Juliana is training 90 school leaders from 30 schools to enhance their Adam from Biji-biji Initiative. administrative skills by incorporating technology into their school management processes. Throughout the year, Fellows will invest their time in an intensive 12-month leadership development programme that aims to foster a • School leaders’ workshops were shifted online to ensure that deep connection among themselves and enable them to engage in their development under the programme was uninterrupted during discussions that will prepare them for a lifelong journey of effecting the COVID-19 pandemic. The organisation also provided support positive social change in their respective communities. Upon completion in the form of coaching for the school leaders focusing specifically of the programme, Fellows will join the global Acumen community on crisis management and the well-being of the school community. of more than 700 Fellows working to create lasting change in society. • Open sessions were organised, sometimes jointly with other organisations to broaden the reach of the organisation's work among In March 2020, the COVID-19 pandemic and the resulting Movement school leaders. One of the open sessions featured the former Control Order (MCO) brought almost all activities in the country to a Director of Institut Aminuddin Baki, Dato' Dr Mehander Singh. halt and the Academy’s planned seminars for its Fellows in the first half of 2020 were not spared. Fortunately, the team was able to move the in-person seminars to virtual seminars thereby ensuring that Fellows could still gain the skills, tools and mindsets necessary for effecting social change during such challenging times.

In 2019, the first cohort of 22 schools from the Klang Valley graduated from the pilot programme. The “Best Global School Leaders Malaysia School” award was given to Rozitah Binti Hamzah and Nor Izah Binti Mohd Sappri from SMK Tengku Idris Shah

In 2020, the organisation worked with its second cohort of 42 schools within the Klang Valley and an additional 22 schools from other parts of Malaysia in partnership with the PINTAR Foundation

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FrogAsia – Transforming Education for the Future Leaps of Knowledge: Changing Hearts and Shaping Minds

An Internet-enabled solution bringing learning beyond the traditional and physical boundaries of the classroom, FrogAsia is committed to The event saw about 600 participants including parents, O provide every child access to education regardless of background or teachers, educators and those interested in education and helping VERVIEW location, with a firm belief in a world where students love learning learners thrive. and where technology removes boundaries. Leaps of Knowledge, organised by FrogAsia, is a platform for thought leadership that inspires and empowers educators to raise lifelong 7,175 schools worldwide learners. The theme of the conference centered around FrogAsia’s HEART values, which are believed to be the building blocks and More than 30,000,000 quizzes completed guiding principles that form the foundation of education for future Up to 46% improvement in subject results generations. Through a series of talks, workshops, conferences and

other events, featuring the world’s leading technologists, innovators NAT

and shapers, FrogAsia aims to inspire a sense of purpose and joy by U Frog World Championship changing hearts and shaping minds. RAL C APITAL Since 2018, the Frog World Championship has garnered participation from 15 countries and over 7,000 schools worldwide.

Hosted by FrogAsia in collaboration with Frog Education UK, the Frog World Championship showcases and celebrates how schools and students can strive to be globally competitive through collaboration HU

and perseverance – boosted by a dose of fun learning. MAN C APITAL

The conference this year featured impactful leaders such as Swaroop Rawal, Global Teacher Prize 2019 Top Ten Finalist, Nicholas Piachaud, Policy and Advocacy Manager of Varkey Foundation, Puan Sri Sherina Leong-Aris, Educationalist and Datin Kathleen Chew, Programme Director of YTL Foundation (left to right) SOCIAL AND RELATIONSHIP CAPITAL

Frog Teacher Awards 2020

This is an annual celebration and appreciation of pioneers in education across Malaysia organised by FrogAsia and supported by YTL Foundation. The Awards aim to recognise pioneers in education with outstanding achievements in adopting technology and raising standards in classrooms and communities nationwide. Top Frog Teacher users were selected from across the country to submit a report on their initiatives and evidence of the impacts they have seen through the use of Frog. Winners were announced on Teachers Day, 16 May 2020. FINAN C IAL C

Over 3,000 schools worldwide APITA across 13 countries participated

1st: SJK(T) Ladang Elaeis, Johor, Malaysia L 2nd: Frederick Gough School, UK 3rd: Yardleys School, UK

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Enriching Communities

SIPP-YTL JV – Promoting STEM Education SIPP-YTL JV Mobile Learning Unit (MLU)

Nurturing versatile students in STEM (Science, Technology, Engineering SIPP-YTL JV’s MLU is a double decker bus that travels across Johor six and Mathematics) studies enabling them to be equipped with different days a week to provide a whole new experience about the Gemas- levels of knowledge and skills for enhancing competitiveness as well Johor Bahru EDTP whilst encouraging students to learn STEM and as to meet challenges. SIPP-YTL JV, a subsidiary of YTL Construction, vocational subjects. The MLU also provides project information on the has conducted various programmes throughout the year to raise EDTP and promotes rail as an ideal mode of transport among Malaysians. levels of public awareness and understanding of engineering and related subjects.

Rock the Railway Essay Competition

SIPP-YTL JV organised an essay competition in collaboration with Legoland Malaysia to encourage creativity and leadership skills, simultaneously creating a 21st century learning experience for students. The competition was open to all public primary and secondary school students across Johor where students had to write and imagine the exciting journey on a Gemas-Johor Bahru Electrified Double Track Project (EDTP) train ride to Legoland Malaysia.

20 winners were selected out of 100 participants at the finale ceremony at Legoland Malaysia, Nusajaya on 29 August 2019

FINCO Reads Programme

In November 2019, Johor State Education Department organised a reading programme to cultivate good reading habits amongst secondary school students in Johor. Approximately 150 people attended the event including the organising committee and SIPP-YTL JV employees.

Natasha Zulkifli, Stakeholder Director of YTL Construction giving a career talk to The MLU has provided an exciting learning experience through creative learning, students to encourage them to study STEM subjects in university and consider a learning-through-play and reading to 5,000 students across 30 schools in Johor career in the rail industry

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International Day of Women and Girls in Science YTL Power Services – Supporting Educational Initiatives

YTL Power Services strives to nurture capable individuals who are 500 students from SMK (P) Sultan Ibrahim, SMK Infant Jesus equipped with both technical and vocational knowledge and integrity O Convent and Sekolah Tun Fatimah joined the event. by rewarding exceptional students that may be potential recruits for VERVIEW the company. In conjunction with International Day of Women and Girls in Science, SIPP-YTL JV organised an event in collaboration with Heriot-Watt University to encourage female students to become lifelong learners of STEM.

Universiti Putra Malaysia (UPM) Faculty's Award NAT

• Sponsorship of RM1,000 per year to one top U RAL student from UPM Engineering Faculty C APITAL

German-Malaysian Institute's (GMI) Convocation Award • Sponsorship of RM3,000 to one top student for his/her project work through the “Overall Best Student Award” under the category Electrical and Engineering HU

Students from Sekolah Tun Fatimah enjoying fruitful day with Mutiara Zainal Farid, YTL International College of Hotel Management (YTL-ICHM) MAN General Manager at YTL Construction, the Headmistress of Sekolah Tun Fatimah – Room Division Symposium 2019 C

and Natasha Zulkifli, Stakeholder Director of YTL Construction (left to right) who APITAL provided them with motivational and inspirational talks A total of 20 event management students and two lecturers at YTL-ICHM organised the Room Division Symposium 2019 to educate School Safety Engagements and enrich second year students with a better understanding for the Room Division in their future industrial placement. Since the commencement of the Gemas-Johor Bahru EDTP, SIPP-YTL SOCIAL AND RELATIONSHIP CAPITAL JV has been conducting safety tip briefings at primary and secondary schools near the project site in collaboration with Women in Rail Malaysia, ensuring that the students understand and adhere to all signages near the construction areas.

FINAN C IAL C Maverick Loh, Executive Assistant Manager at Sheraton Imperial Kuala Lumpur, APITA Lum May Ling, part time lecturer, Sharezal Abdul Wahid, Director of Concierge

at The Majestic Hotel Kuala Lumpur and Hotel Stripes Kuala Lumpur, and Saiyida L Nafisa Rosdi, lecturer cum Programme Leader at SEGI College Kuala Lumpur (left This year, the briefing sessions reached out to over 2,000 students across eight to right) seen here as guest speakers giving advice and sharing their experiences schools near the Gemas-Johor Bahru EDTP construction areas as industry players

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Indonesia Singapore

YTL Jawa Timur (YTLJT) – Providing Educational Support and YTL PowerSeraya – Promoting Positive and Sustainable Resources Environment

YTLJT continues to provide education assistance to the communities In order to promote their corporate social responsibility vision, YTL they served including the provision of scholarships, education packages PowerSeraya organised various outreach programmes for communities and training as well as improving education facilities. where they operate.

Punggol Learning Adventure for Youths (PLAY)

13 full scholarships awarded to outstanding students PLAY is an interactive learning programme that seeks to raise awareness and knowledge of water issues at both global and local 2,000 education packages and 20,000 work levels in partnership with Waterways Watch Society as its knowledge books distributed to students in need partner. 70 students from two secondary schools went through an One training session provided to help teachers education trail to learn about water-climate change issues, causes develop professional skills of water pollution and also to gain an appreciation of water as a precious resource through activity stations. Four education events sponsored in Situbondo and Probolinggo regencies

Two education facilities supported for Sepuluh November Institute of Technology, SMP Bhakti Pertiwi and SMA Tunas Luhur, aiming to support online teaching learning activities, including online national exams

Soccer Academy Programme held in collaboration with ASA (ASEAN Soccer Academy) Foundation to help Probolinggo youths under 12 years old in developing education, health and life skills through soccer Hougang Secondary School students learning about water and climate change Since 2019, the company has been the appointed through group activities and games assessor for the preparation of the Adiwiyata Green School Programme at Probolinggo Responsible Energy Advocates Programme, REAP (Junior) regency level REAP (Junior) seeks to educate and engage pre-tertiary students on issues surrounding energy and climate change. Education materials with an energy-climate change quiz were provided to three participating schools to test students’ knowledge on energy and its relationship to climate change. This programme saw more than 200 students taking part. The students were also invited to participate in YTL PowerSeraya’s “Power The Change” jingle contest to sing about behaviour that helps to reduce energy waste.

The Jawa Power-YTL Elite Soccer Team during their weekly training in Paiton A video screenshot of jingle submission from Teck Whye Secondary’s team

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United Kingdom Thailand

Wessex Water – Sparking Interest within Sustainability The Surin Phuket – Supporting Students in Need O Industries VERVIEW The Surin Phuket believes that no child should be left behind in Wessex Water is committed to growing skills and providing opportunities education, and the Hotel has been supporting special needs and rural in a workforce that reflects the communities they serve through schools by providing students with education packages. apprenticeships and education.

Education Service

Wessex Water’s long-standing free education service to schools

continues to deliver topics associated with water, sewage, public health NAT

and environment, with engaging sessions in schools and at their sites. U RAL C Wessex Water’s four education advisers not only visit schools, but APITAL also offer sessions at their education centres. Last year, around 27,000 people in total, including 24,000 children and students benefitted from school visits with targeted curriculum sessions and trips to water treatment and water recycling centres, interactive 65 school bags were donated to special needs students at Phuket Panyanukul presentations, demonstrations and hands-on science investigations. School HU

27,000 people educated by Wessex Water MAN

education advisors free of charge C APITAL

over 47,000 households receiving financial support

Ignite Work Experience Programme SOCIAL AND RELATIONSHIP CAPITAL Having already successfully taken on one work experience student full-time, GENeco UK will look to continue to expand the development programme designed for young people within local communities. The aim of the project is to help provide a pathway into renewables, focusing 25 Thai and English bilingual story books were donated to Wat Inthanin School, on young people that may not otherwise have the opportunity. located at the remote area of Phang-Nga province FINAN C IAL C APITA L

Students enjoying challenging team-building activities and an exciting site tour of GENeco UK’s Bristol site

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SUPPORTING COMMUNITIES Women at YTL (W@Y) – Empowering Women through WOWED

In 2019, YTL Group’s very own women’s network, W@Y started its collaboration with Women of Will (WOW) and Agensi Inovasi Malaysia OUR GOAL: (AIM) in the 12-month WOW Entrepreneurship Development (WOWED) To improve livelihoods and the well-being of communities Programme. It aims to uplift the socio-economic mobility of 50 selected B4017 single mothers by providing them with an opportunity to initiate or grow small businesses and earn an income. At YTL Group, we recognise that we are an integral part of the communities where we operate. We strive to make a positive Initiatives in FY2020: contribution to the communities we serve by supporting vulnerable • Three “Community Days” were organised to provide practical groups and giving back to communities through charitable causes skills training such as bread baking workshops. even during unprecedented times. Through partnerships, we believe Community Leadership Training Sessions that we can multiply the impact we deliver and make a good future • Two conducted to happen for those in need. help community leaders understand their roles and responsibilities as well as how to manage their respective communities.

Malaysia • Set up “WOW Ramadhan Markets” Facebook groups for each community to reach out to customers and sell their products YTL Power International (YTLPI) – Providing Local Communities during the pandemic. with Basic Necessities

In line with its commitment towards achieving SDG 6 – Clean Water and Sanitation and SDG 7 – Affordable and Clean Energy, YTLPI strives to improve sanitation and access to drinking water as well as to ensure universal access to affordable and sustainable energy for local communities.

Started in 2018, the Communities Unite for Purewater (CUP)15 project made a meaningful impact at Kampung Sion and Kampung Semada Belatok in Sarawak. In addition, the Solar for Sion16 project provided Kampung Sion with a much-needed affordable and sustainable source of electricity, solar power. When the COVID-19 pandemic descended upon the nation in early 2020, YTL Foundation’s Learn from Home Initiative enabled children across Malaysia including in Kampung Sion to continue their education online. More details can be found in the “COVID-19” subsection on page 90.

Employees from YTLPI and YTL Foundation visited Kampung Sion with members of In October 2019, the first stage of the WOWED Programme was kick-started Global Peace Foundation in October 2019, to conduct a post implementation survey where capacity building programmes were provided for single mothers to start on the impact of CUP and Solar for Sion projects and run their own businesses

15 In collaboration with AIM and Global Peace Foundation (GPF), CUP is a social intervention programme that seeks to uplift the welfare of targeted rural and underserved communities through the provision of clean water 16 A community uplift project at Kampung Sion in collaboration with GPF that provided sustainable and renewable solar energy 17 B40 refers to the bottom 40% of households with median monthly income of RM3,000 and below 78 SUSTAINABILITY REPORT 2020

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Indonesia

YTL Jawa Timur (YTLJT) – Multiplying Impact through Collaboration O VERVIEW In accordance with their commitment to improving the well-being and prosperity of local communities, YTLJT continued to initiate economic empowerment programmes in collaboration with local government and community members.

Sea Pines and Mangrove Cultivation Infiltration Well for Water Plantation for Water Conservation Water Access Programme NAT Programme Conservation Programme Programme U RAL Partnership Partnership Partnership Partnership C

• Local government • Local community • Local youth from Sumberrejo village, • Local community leaders APITAL • Groups of farmers • Local workshop Paiton • Village officers • Local education institutions • Local workshop Description Description Description • To solve water shortage issues at • To preserve water streams at Description • To improve the environment of Paiton Selobanteng village, Situbondo regency Probolinggo, Selobanteng and • To provide water access to communities coastal areas through plantation Telempong of Situbondo regencies, located at remote areas with the programmes, environment awareness Impact through the planting of bamboo and installation of hydram pumps campaign activities • 29 infiltration wells (volume of 121 m3) Gayam trees and seven water storage tanks (volume Impact Impact of 86 m3) were built between 2016 Impact • 12 hydram pump units installed for HU • Produced self-propagated seeds and 2018. In FY2020, the relevant • 400 bamboo plants and 800 Gayam several houses and a small mosque, MAN for the plantation at Randutatah communities participated in the seeds were distributed to relevant “Mushola”.

Conservation Area. maintenance of the infiltration wells. villages for reforestation activities. • Provided water irrigation to inaccessible C • Area developed into eco-tourism • Restored faulty inlet pipes at water • Preserved water streams and areas and maintained feed water for APITAL destination, improving incomes of the springs. strengthened catchment areas. livestock. local community, and serving as an • Saved 46,120 m3 of water annually • Improved income of the community • Provided easy access to water. educational site for camping and the which fulfilled the daily water needs by harvesting bamboo trees and • Improved health and hygiene for local study of biodiversity. of more than 1,900 villagers. Gayam fruit. community. SOCIAL AND RELATIONSHIP CAPITAL

Development of Bermi Eco Park House Renovation Programme Community Income Generation Programme

Partnership Partnership Partnership • Bermi Village Enterprises (Bumdes • Local community • Padi-Padi Jakarta Bermi) Description Description Description • To rehabilitate uninhabitable or nearly • To improve incomes of communities through mangrove flour and snack production • To improve the environment at Bermi uninhabitable houses for less fortunate programme Eco Park through conservation families • To help Rejeki 17 gain better visibility for their Watupanjang organic coffee activities, environmental education,

and eco-tourism activities Impact Impact FINAN • A total of 15 homes were renovated. • Value added to mangrove fruits, which are abundant during harvest at Randutatah

Impact • Instilled cultural values. Mangrove and Sea Pines Conservation Area. C • A number of facilities with a total cost • Improved quality of life for future • Formulated a standard operating procedure for mangrove flour production and IAL C

of IDR746 million were built, including generations. coffee planting, maintenance and post-harvest processing. APITA a 1,000 m2 water reservoir, nursery, • Mangrove flour and snack production training was provided to ten members of gazebos, bridges, toilets, jogging Kelompok Wanita Tani Nelayan (Women Group of Farmers). L tracks, and a multipurpose building. • Increased popularity of mangrove snacks and Watupanjang organic coffee by • Developed into eco-education and participating in the National Agriculture Exposition in Jakarta. eco-tourism destination. • Provided side income and job opportunities. • Improved socio-economic condition of • Increased participation in mangrove conservation activities. local community.

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Singapore

Geneco SG – Powering Positive Change in the Community

YTL PowerSeraya believes in reaching out to the community at large. Through Geneco SG, the electricity retail brand of YTL PowerSeraya, the company is seeking to power change for a more sustainable energy future by harnessing the positive energy of like-minded individuals and organisations through their Geneco ChangeMakersSG Programme.

Comcrop Cultivate Central Repair Kopitiam Farm-to-Table Popiah Making Party Urban Food Garden Workshops Launch of the Third Repair Kopitiam Site

Description Description Description • Provided a unique food experience to Geneco SG’s • Created a series of specially curated urban food • Geneco SG supported the launch of the third Repair customers by using ingredients that were grown garden workshops for children to connect with nature Kopitiam site in Ang Mo Kio, to focus on residents on-site at Comcrop’s urban rooftop farm complex in and learn what they can do to protect the in the central “heartlands” of Singapore and bring Woodlands. environment. together a community of like-minded individuals to combat throwaway culture. Impact Impact • The event saw the attendance of 159 Geneco SG’s • In conjunction with the Open Electricity Market Impact customers and their family members. roadshow, the workshops catered for over 500 people • Dr Amy Khor, Senior Minister of State for the Ministry over two days. of the Environment and Water Resources graced the • A worm hotel18 was displayed to the public. event as Guest of Honour. • The official launch was attended by over 80 residents from the neighbourhood.

Food Bank Singapore Refash Feed the City Refash Cares

Description Description Green Nudge • Employees from Geneco SG took time off to volunteer • Refash aims to give every piece of clothing a Plastic-free Challenge with Food Bank Singapore to serve and engage with meaningful second life. When the COVID-19 lockdown the elderly. on businesses was implemented, Refash pivoted Description with the launch of Refash Cares, catering to the • Geneco SG collaborated with Green Nudge to launch Impact needs of Singaporeans by sourcing and selling the 14-day plastic-free challenge to work towards • The closed-door event saw 90 elderly people certified surgical masks to their customers. reducing plastic waste in Singapore. attending. Impact Impact • In order to support Refash’s efforts, Geneco SG • The challenge reached a total impressions of 132,500 purchased surgical masks from Refash Cares to assist on both Instagram and Facebook. them within their operational costs. More details can • 35 participants took on the challenge. be found in the “COVID-19” subsection on page 89.

18 A structure that consists of several stackable trays made from wood. The worms live in the trays and simple wriggle their way up from the lowest tray into the one above, where they can smell the fruit, vegetable and other scraps

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United Kingdom

Wessex Water – Supporting Community through Funding O and Campaigns VERVIEW

Developing stronger relationships with customers across the region is a key aim of Wessex Water’s community engagement work. Over the last year, the company has provided tap water refill points, funding, volunteers, events and recreational activities to many of their customers. In the summer of 2020, Wessex Water launched the new Wessex Water Foundation, a multi-million-pound initiative that will mainly In March 2020, Wessex Water supported the Bath Half Marathon in its aim to benefit people hit hardest by the COVID-19 pandemic in its first year. become plastic-free and change the behaviour of over 12,000 competitors. NAT Working with dedicated local volunteers and by providing tap water in compostable

cups, around 25,000 single use plastic bottles were avoided in one day to an U Community and Environmental Funding RAL overwhelmingly positive reaction from those who took part C Wessex Water’s community and environmental funding supported APITAL more than 100 groups and charities across the region in the last Wild about Wessex year, helping people to build stronger communities through partnership With such an environmentally rich region, Wessex Water believes it work with local community foundations in Bristol, Bath, Wiltshire, is part of their duty to maintain and enhance community spaces Dorset and Somerset. alongside local charities and organisations, to protect the environment and improve the lifestyles we have. The company provided recreational activities through reservoirs and fisheries, supported by a dedicated

Forest Child: HU team of expert rangers. As part of the development of future To help the group hold sessions for families who have MAN improvements at their two flagship destinations, Sutton Bingham

experienced domestic violence. C and Clatworthy, Wessex Water has set up local user and stakeholder APITAL River Bourne Community Farm in Salisbury: groups to help provide feedback on local priorities for the sites. To help the community farm support many people in the area, especially children with special educational Fishing for Life: needs. Provided high-quality trout and coarse angling at SOCIAL AND RELATIONSHIP CAPITAL The Bus Stop Café in Wimborne: Wessex Water’s reservoirs to support women in Wessex Water’s funding will cover employee food, recovery from breast cancer in undertaking therapeutic utilities and training costs, helping the café to provide recreation by learning to fish. its vital service. Local sailing and water sports clubs: Yeovil Rivers Community Trust: Supported access to recreation at Wessex Water’s To help the community trust carry out a project which larger sites. aims to teach local children about water in the environment. The project involves three classroom- based sessions around this theme.

Refill Not Landfill FINAN

Wessex Water’s water refill campaign has provided mobile water refill C points at shows and events throughout the year and continued to IAL C promote drinking tap water for healthy living with local health APITA organisations, food banks and charities. To help reduce the use of L single use plastic, the company has installed permanent tap water Seed sticks were given out as freebies in supporting the Dorset Wildlife Trust refill points in Trowbridge and Salisbury with more planned in with Get Dorset Buzzing – a campaign set up by the charity in response to the Weymouth, Poole, Bath and other locations across the South West. national decline in buzzing bees, butterflies and hoverflies

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Vietnam Community Impact across the Globe

Fico Tây Ninh Cement JSC (Fico-YTL) – Supporting Development Supporting Community Events of Local Communities

Fico-YTL is a leading cement company supporting the development of Vietnamese communities, mostly at the Tây Ninh province where their integrated plant is located.

For the last ten years, more than 100 BILLION worth of Vietnamese Dong (VND) in cash and in-kind (cement) was contributed by the company to local communities in following areas: YTL Corporation sponsored GBP5,000 for the BluHope campaign on World Ocean Day to raise awareness in protecting the ocean and reducing plastic pollution.

Fico-YTL has been sponsoring the construction of concrete roads and bridges in Tây Ninh province.

Rural Infrastructure Development

VND600 million invested in building playgrounds at the central park of Tây Ninh city and Tân Châu district. YTL Power Services sponsored RM2,710 worth of sports t-shirts and tracksuits for Terengganu State Police Department’s participation in the National Police School and Kindergarten Development Department Pétanque Competition in Johor and Kedah.

Every year, Fico-YTL contributes cement to the forest to build necessary infrastructure such as perimeter walls to prevent encroachment into the Forest Protection and Recreation Du Ting forest reserve.

Fico-YTL also contributes billions of Vietnamese Dong and thousands of tonnes of cement supporting Tây Ninh Wisma Atria Singapore was one of the event sponsors for ROMP 19. Amongst the province's military veterans 2,000 young athletes and volunteers that took part were participants with intellectual disabilities. SGD1,350 worth of Wisma Atria vouchers were sponsored and borders. Border Protection as prizes for the winners.

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Enriching Communities O VERVIEW NAT U RAL C APITAL YTL Construction sponsored RM10,000 for the YTL Communications (YES) has returned as Platinum Institute for Democracy and Economic Affairs (IDEAS) Sponsor for the seventh time for Starwalk Penang fundraising event, “A Decade of Upholding the 2019. More than RM75,500 worth of cash and in-kind Wessex Water sponsored 50 team kits and 772 reusable Values of Liberty and Justice in Malaysia”. prizes were sponsored for the event. water bottles for 50 local football clubs. HU MAN C APITAL

Myer Centre Adelaide provided the Salvation Army Lot 10 shopping centre (Lot 10) sponsored the venue for race pack collection for The Music Run 2019 by CIMB,

a space to host their signature fundraising drive, SOCIAL AND RELATIONSHIP CAPITAL whilst YTL-SV Carbon conducted carbon footprint assessment and assisted in the purchase of emission offsets. The Red Shield Appeal, which helped fund a vast In order to make the event fun and sustainable, runners were encouraged to deposit their e-waste or old network of social and community services within clothing during the race pack collection at Lot 10. This was the first ever carbon-neutral mass participation South Australia. event in Malaysia.

In conjunction with Singapore’s 54th National Day, Wisma Atria Singapore co-organised the Bicentennial National Day Bears 2019 Exhibition with The HEART Enterprise. The exhibition showcased 54 fabric bears hand-sewn by people with special FINAN needs and disabilities. The funds C

raised from the exhibition through IAL

an online auction went towards the C development of the Community APITA Village SG.

Fico-YTL sponsored VND10 billion to support Tây L Ninh Football Club competing in the 2020 V. League 2 under the name “Xi Măng Tây Ninh FC”.

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Donations and Fundraising

Brisbane Marriott Hotel sponsored AUD1,093 worth of prizes for charity events which contributed to Lifeline raising a total of AUD126,959, as well as the Australian Bush Fire Crisis19, raising a total of THB191,793 for 32 employees and public donors participated in the The Salvation Army. Associates from the Hotel also SIPP-YTL JV distributed RM10,350 worth of essential blood donation programme organised by ERL Maintenance participated in various charity events, raising AUD997 items to 202 families during the Kluang and Labis Support (E-MAS) Safety and Security Department in for Starlight Children’s Foundation and AUD612 for floods in Johor. collaboration with National Blood Bank. Mater Hospital - Maters Little Miracle.

Apprentices from Wessex Water and GENeco UK took Eleven teams from Wessex Water participated in a charity part in the Portishead Charity Soapbox Race where football tournament raising GBP2,500 for National Autistic GENeco UK’s employees took part in a Tough Mudder the event raised GBP20,122 for St Peter’s Hospice in Society, Make-A-Wish UK, Wiltshire Air Ambulance and challenge, raising GBP420 for Caring in Bristol which Bristol. Weldmar Hospice Care. tackles homelessness around Bristol.

15 employees from The Surin Phuket participated in The Surin Phuket donated THB20,000 worth of food the Children First Charity Football, “Banyan Tree 25th The Surin Phuket hosted a lunch at Good Shepherd to Ban Don Shrine in support of the Phuket Vegetarian Anniversary Tournament”, raising THB4,000 for Children School, benefitting over 160 children. Festival. First Fund Foundation.

19 A charity event hosted by JW Marriott Phuket Resort and Spa, Anantara Mai Khao Phuket Villas, Renaissance Phuket Resort and Spa as well as Sala Phuket Resort and Spa. Brisbane Marriott Hotel sponsored AUD500 worth of prize donation

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Volunteerism O VERVIEW NAT More than 500 employees from Wessex Water lent a helping hand to good U

causes, volunteering for a total of 3,188 hours. The Water Force volunteers took RAL part in more than 50 activities, from cleaning beaches and maintaining nature C reserves to building benches and painting classrooms. APITAL

Tanjong Jara Resort has been working with Lang Tengah Turtle Watch on coastal cleanup events throughout the year. Since July 2019, a total of 1,466.4 kg of waste was removed from Tahu Tiga beach with the help of 220 local school and polytechnic students near Dungun. HU MAN C APITAL

Every month, three or four associates from the Melbourne Marriott Hotel visit the Cerebral Palsy Education Centre in Melbourne to assist in gardening, sorting of tools and any general maintenance. The centre is the only one of its kind in SOCIAL AND RELATIONSHIP CAPITAL Australia. FINAN

YTLJT initiated a coastal cleanup campaign called “Reresik Pantai” on 22 August C IAL 2019 in Randutatah beach, Probolinggo. 60 kg of organic waste, C

5 kg of recyclable waste and 78 kg of other waste was collected during the In September 2019, approximately 20 employees from The Surin Phuket conducted APITA event. The event also elevated the campaign on plastic use reduction and included a beach cleanup along the 350-metre beach front of the Hotel. 150 kg of waste

a workshop on composting. was collected. L

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Festive Celebration

Christmas 2019

In collaboration with its ChangeMakersSG During the festive season, Wessex partners, Geneco SG organised a series Water volunteers helped to collect food of activities at its Green Christmas Lodge and toiletry items which were donated at Wisma Atria Singapore, which included to eight local food banks across the UK. various sustainable craft workshops and a kinetic bicycle to light up the Christmas tree decorations. These free workshops allowed shoppers to customise Christmas Cocodama moss balls or create coasters YES sponsored RM180,000 for the Dewan Bandaraya Kota Kinabalu (Kota made from recycled T-shirts. Kinabalu City Hall) Christmas celebrations, keeping cultural heritage alive during the festive season.

Wessex Water’s employees helped Wave 105 Cash for Kids Mission Christmas to distribute donated Christmas presents, ensuring that 32,000 children woke up to a present on Christmas Day. During the Christmas season, ten employees from SIPP-YTL JV visited four A green Christmas was celebrated at orphanages and nursing homes across Johor, and donated RM7,000 and gifts, Wisma Atria Singapore where benefitting 100 people in need. decorations were made using recycled materials, and gift-wrapping papers were made of recycled paper. The main Christmas tree installation was constructed entirely using plywood and adorned with ornaments and clear 21 Wessex Water volunteers helped baubles containing scroll strips made Dorothy House Hospice raise more than from recycled paper. GBP40,000 by recycling Christmas trees in Bath and Trowbridge.

In collaboration with RIUH, Sentul Depot was transformed into a winter wonderland with an ice-skating rink presented by YTL Land & Development (YTL L&D), Christmas bazaar, and The Gainsborough Bath Spa organised themed cultural and festive activities. two carol singing concerts conducted YTL L&D pledged all proceeds from by local celebrity, Grenville Jones and ticket sales to Hope Worldwide JW Marriott Hotel Kuala Lumpur raised The Ritz-Carlton, Koh Samui granted his choir. 100 paying guests attended Malaysia, and presented RM2,000 to money and prepared gifts, helping Christmas wishes to over 53 children the concerts and proceeds of GBP1,000 the organisation in support of its over 150 less fortunate children across local public elementary schools, were donated to a local charity, Julian charity-related development work. realise their Christmas wishes. special needs schools and churches. House.

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Chinese New Year 2020 O VERVIEW NAT U During the Chinese New Year season, 15 employees RAL

from SIPP-YTL JV visited six orphanages, special Wisma Atria Singapore held their annual traditional C needs and nursing homes across Johor, and donated YTL Cement donated RM9,240 worth of gifts and lion dance and dragon dance on 31 January 2020 as APITAL about RM20,000 worth of gifts and essential items, hampers to 130 underprivileged residents in Kanthan a symbolic event to usher in a bountiful and prosperous benefitting 1,500 people. Bahru, Perak and Rawang, Selangor. Lunar New Year.

Hari Raya Aidilfitri 2020 HU MAN C APITAL SOCIAL AND RELATIONSHIP CAPITAL

SIPP-YTL JV donated RM8,000 worth of groceries to 200 B40 families from KTM Berhad (KTMB). The initiative was organised by the Ministry of Transport (MOT) with about 20 people from MOT involved, including the Minister of Transport. SIPP-YTL JV and KTMB also attended the hamper giving ceremony. As a token of appreciation to all external stakeholders of the Gemas-Johor Bahru EDTP, SIPP-YTL JV distributed RM14,790 worth of iftar food during Ramadhan and Raya hampers across Kuala Lumpur and Johor. FINAN C IAL C APITA SIPP-YTL JV donated RM31,852 worth of essential items

and groceries to 200 Johor Police Community Members L The Ritz-Carlton, Kuala Lumpur and JW Marriott Kuala Lumpur raised RM25,800 to provide meals for breaking and provided refreshments to police officers on duty at fast to 13 charity homes across the Klang Valley, benefitting 645 people. roadblocks and near the Gemas-Johor Bahru EDTP site.

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COVID-19 SUPPORT

The COVID-19 pandemic has brought unprecedent disruptions to society as many countries grapple with lockdowns of varying degrees imposed by governments and municipalities. At YTL Group, we continue to dedicate resources to help those in need to overcome one of the most critical challenges of their lifetimes by providing continued access to education and local relief aid.

Funding the Fight against the COVID-19

YTL Foundation donated RM1 million to the Government’s COVID-19 Fund whilst YTL Construction donated 4,000 face masks to local authorities in Johor and three YTL Power International also contributed RM500,000 to The Edge COVID-19 ventilators to Yayasan Sultan Ibrahim Johor. SIPP-YTL JV also provided free meals to Equipment Fund. 10,000 frontline health workers at Hospital Enche’ Besar Hajjah Khalsom, Kluang, Johor.

YTL Foundation donated mobile phones, Chromebooks and essential items to Hospital Sungai Buloh to be used by frontline health workers fighting the disease.

YTL Corporation sponsored ten complimentary stays for Institut Jantung Negara (National Heart Institute) employees during MCO at Vistana YTLJT distributed personal protective equipment, face masks and disinfectants Residences Kuala Lumpur. worth more than IDR319 million to ten local hospitals and public health centres in Probolinggo and Situbondo regencies, East Java.

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Local Communities not Forgotten O VERVIEW NAT U RAL

322 families in need of food aid relief received assistance from YTL Foundation both directly and indirectly Express Rail Link distributed essential items to 136 C APITAL through various organisations cognisant of their plight. taxi drivers operating out of KL Sentral. HU MAN C APITAL

YTL Foundation distributed 320 reusable face masks to students, teachers and SOCIAL AND RELATIONSHIP CAPITAL school administrators of SMK St. Mary, Kuala Lumpur as a surprise school YTL Construction donated RM117,000 to YB Parliamentarians and ADUNs (State reopening gift under the BIG GIVE campaign by 100% Project. Assembly Representatives) along the EDTP alignment to help the poor and needy. FINAN

As ComCrop’s rooftop greenhouse is C IAL Geneco SG purchased 15,000 masks experiencing a greater strain to increase To help tenants through the business C

from Refash Cares to assist them in their production due to the disrupted disruption due to the COVID-19 pandemic, APITA operational costs and the company also international food supply chains caused total rental rebates of SGD32.2 million

Geneco SG pledged to donate 1,000 collaborated with The Food Bank by the pandemic, Geneco SG committed were provided to eligible tenants in L meals to help the less fortunate through Singapore in this partnership to distribute to subsidise SGD8,400 for ComCrop’s SGREIT’s portfolio. More detail can be a social media campaign, in collaboration the masks to families within vulnerable electricity bills in support of their found in the “Marketplace” section on with The Food Bank Singapore. communities during food deliveries. sustainability efforts. page 104.

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United Kingdom Malaysia

The New Wessex Water Foundation Supporting Continued Access to Education

In the summer of 2020, Wessex Water launched a new multi-million- When the COVID-19 pandemic struck Malaysia in mid-March 2020, pound investment providing funding and support for local communities school children were faced with unforeseen disruptions in their study for immediate and future needs. In response to the COVID-19 pandemic, as schools were closed across the country. Students in institutions the region-wide emergency funds will award immediate grants through of higher learning were also affected as colleges and universities community foundations to hundreds of local groups on the front line, suspended in-person lectures and sent students home. like food banks, support for the elderly and other charities which would shut down without help because other sources of funding Learn from Home Initiative have disappeared. On 25 March 2020, YTL Foundation launched the Learn from Home Initiative in collaboration with YES and FrogAsia to ensure that Immediate Support for Local Groups Malaysian children would not be adversely impacted during the period when schools were closed and could continue to learn at home To support local groups responding to the COVID-19 pandemic, without additional costs to their parents. They did this by providing Wessex Water has: free mobile data and online learning material to all students registered in Malaysian government schools to learn from home. donated GBP120,000 to local emergency appeals with community foundations; YTL Foundation offered up to five free YES 4G prepaid SIM cards, one for each school-going child in the family, to parents of children provided over 6,500 hot meals for vulnerable in Government schools and free mobile phones to students from B40 and isolated people in the Bath community; families. As the MCO continued into the months of April and May, free SIM cards were also offered to students from independent supported many of their employees to volunteer in Chinese secondary schools as well as universities and colleges across their communities. the country. Free SIM cards and mobile phones were also donated to underprivileged communities.

Wessex Water Recovery Fund A series of engaging English, Science and Mathematics lessons developed specifically for learning from home for students from In response to the challenging economic situation which many pre-school level to Form five were developed by FrogAsia, in partnership communities will face, the Wessex Water Recovery Fund will open with TFM, Pelangi Publishing Group, Kindity Montessori Preschool, for applications from groups in the Wessex Water area from late Universiti Kebangsaan Malaysia and MyReaders and over 800 lessons 2020. It will support local groups who build social value by strengthening made available for free on YTL Foundation’s website. As of the end the resilience of local communities. This has proved to be essential of August 2020, these lessons have been accessed over 300,000 in the current COVID-19 pandemic, where local groups have mobilised times with the most popular being the English lessons. There are large numbers of volunteers and responded on the front line to help plans to add lessons in Bahasa Melayu in September 2020 with the those most in need. view that the entire syllabus for the four subjects will be made available by the end of the year. Future Investment in Communities

From 2021 the new permanent fund will provide at least GBP500,000 Number of Lessons Created of funding every year to continue to support community projects, debt advices and charities dealing with those suffering the consequences of poverty through poor mental and physical health, 500 English lessons hunger, housing and unemployment. Wessex Water will also continue to support local environmental projects, supporting the ambition to 280 Mathematics lessons rebuild communities with new green infrastructure. 250 Science lessons

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Remote but not Forgotten – Kampung Sion, Sarawak

YTL Foundation provided 24 families in Kampung Sion, Sarawak with free mobile phones under the Learn from Home Initiative so that their O children could continue learning during the MCO. With these devices, VERVIEW the children were able to join the online classes provided by YTL Foundation. To further assist remote learning in the village, a laptop, monitor, speakers and camera were also donated to the community.

YTL Foundation collaborated with Deloitte Malaysia to provide free SIM cards to These items improved the accessibility to the online classes for the a total of 100 children from B40 families. With the free data provided by YTL children. Online learning has opened up new learning opportunities Foundation and tablets provided by KassimChan Foundation, volunteers from for children in remote communities that previously did not exist. Deloitte Malaysia used the lessons from the Learn from Home Initiative to provide online tutoring to these children

The Story of Three Little Boys NAT

Transitioning to Online Learning U RAL

As schools and institutions of higher learning were required to close C APITAL during the MCO, YTL Foundation’s after-school educational programmes were also suspended. YTL Foundation immediately moved the classes online and with the help of technology, the children continued to participate in the programmes. Classes on Zoom platform were conducted throughout the day, five days a week by YTL Foundation’s team of teachers.

During the period between 26 March and 30 June 2020, HU

a total of 220 classes centered on eight distinct MAN programmes – English, Mandarin, Science, Mathematics, Fiona (13), who stopped school due to financial constraints, also joined C APITAL Drama, Drawing, Geography and Music which were held the class together with the three little boys online. English and Science were taught using lessons from the Learn from Home Initiative. During an assessment held with the Kampung Sion children, YTL Foundation realised that three of the children in particular Children from the community in Sentul as well as further away in seemed to struggle more than the rest – Wilson (seven), Rafel SOCIAL AND RELATIONSHIP CAPITAL Penang, Kedah and Sarawak including children from refugee families (nine) and Karlos (eleven). These three boys are undocumented between the ages of seven to 16 participated in the classes conducted and therefore have never had the privilege of obtaining any by dedicated volunteers. The children enjoyed the classes, learning formal education. To ensure that the three boys were not left and interacting with other children from near and far. Parents also behind, it was decided that 54C would offer separate one-hour appreciated the classes as they saw their children’s knowledge, ability English class every Monday to Friday. Their first class began in the first week of July and the progress has been astounding. and confidence grow as a result of participating in the classes.

Perhaps most significant and most touching of all however, is the unflagging enthusiasm that the three boys, and the other children of Kampung Sion, brought to the class. Whilst I was so worried when the MCO was imposed and Shavitra connected only via a screen, they never failed to appear with had to stay at home and missed her learning in school. pen and notes in hand, eagerly shouting out answers, fearlessly asking questions, and conversing with their teachers like old

The online classes keep her time well occupied and gave FINAN her an opportunity to continue with her education. She friends in a chaotic mix of Bahasa Melayu and English. C

loves quizzes, Maths, Mandarin and other subjects as IAL The MCO might have brought great challenges, but it has also well. I feel assured that she’s not missing her learning C APITA even at home and able to learn independently (zooming brought a great leap of joy. 54C believes that over time, these

on her own) now that I’m back at work.” virtual lessons will have an indelibly positive influence on the L Selva Malar lives and future of the Kampung Sion community. mother of eight-year old Shavitra from SJK(T) St. Joseph, Sentul

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PROMOTION OF ARTS AND CULTURE

OUR GOAL: To protect and promote arts and culture for future generations

YTL Group’s engagement in the cultural life of the community embraces our long-term support for a wide range of programmes that promote and foster arts and culture in the countries that we operate in. From art exhibitions and cultural showcases to health and mental wellness events, we strive to provide a platform for local artists and others working in this area to gain better visibility and facilitate the public’s better access to arts and culture.

United Kingdom

Call of the Wild

Since 2011, YTL Hotels has been supporting Save Wild Tigers (SWT) in their global fundraising events and awareness initiatives. In FY2020, SWT launched two campaigns, namely the “Eastern & Oriental Tiger Express” and the BBC’s film “Tigers – Hunting the Traffickers”. More details can be found on page 95.

Contemporary Art at The Gainsborough Bath Spa (TGBS)

The three-day contemporary art exhibition was organised with the Modern Art Buyer and Rostra, featuring a festive collaboration to showcase contemporary artwork from emerging and established artists. The exhibition has reinforced TGBS’ artistic heritage and its standing as a venue for high quality artistic and cultural events.

Feel Good Bath Bathscape Walking Festival In support of the Feel Good Bath campaign, TGBS and Thermae Bath Thermae Bath Spa was a key supporter of the Spa organised a stimulating series of wellness-related events and Bathscape Walking Festival and its association an education programme, namely “A Perfect Night's Sleep”, “The with the Festival has created a natural affiliation Truth behind Meditation” and The Midweek Reviver spa package. The between walking, the spa and wellness. The final diversity of the events succeeded in attracting 50 customers attending event, Circuit of Bath Walk saw the participation the education programme and more than 200 people booking the of over 1,500 visitors and local residents exploring Midweek Reviver package. The programme was seen as celebrating the countryside surrounding Bath. the history, culture and well-being synonymous with Bath.

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Singapore O

Arts in Your Neighbourhood: Character Clash Art VERVIEW Exhibition

Wisma Atria was the official venue sponsor for the Character Clash Art Exhibition organised by Band of Doodlers and the National Arts Council Singapore, which showcased original characters designed by young artists. A “live” character design competition was also held on 14 March 2020. NAT U

Australia RAL C APITAL

SLOW Fashion Festival

Myer Centre Adelaide (MCA) hosted the “SLOW Fashion Festival” runway show for the first time on 27 September 2019. It was the third year of the festival in Adelaide and the event aims to promote a sustainable and ecological fashion

industry in Australia. The show was widely covered by media HU

personalities and influencers which helped to raise MCA’s Photo courtesy of Dimitra MAN Koriozos

profile as a mall which embraces sustainable fashion. C Malaysia APITAL

Lottie’s Cultural Splash ArtPlusD

This was the fourth in the series of Lot 10 plays host to the popular YTL Foundation’s year-end events to monthly ArtPlusD event, where local SOCIAL AND RELATIONSHIP CAPITAL promote the work of social enterprises artisans sell their wares, attracting and community partners. More details huge crowds of art enthusiasts and can be found on page 94. food lovers.

Elevate Yoga #Lot10NomNom

Warehouse 3 at Sentul Depot Before the COVID-19 pandemic, the welcomed its first event, “Elevate terrace space of Lot 10 would be Yoga” by Elevate Events in early 2020. transformed into a bustling food The community workshop attracted street for the monthly Street Food over 80 yoga enthusiasts including Weekender, which featured a wide residents of Sentul West and Sentul selection of local delicacies from Lot FINAN East, and featured “The Queen of 10 Hutong and international bites. C

Handstands”, Marysia Do, who was The event was temporarily cancelled IAL

specially flown in from the United due to the COVID-19 pandemic. C APITA States for the occasion. L

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YTL Foundation – Celebration of Malaysia’s Multi-cultural Heritage

Malaysia

YTL Foundation collaborated with Pusat Kreatif Kanak-Kanak Tuanku Bainun on Lottie’s Cultural Splash in November 2019. It was the fourth in the series of YTL Foundation’s year-end events to promote the work of social enterprises and community partners.

With the help of other organisations such as Gangsapura, Malaysian Artists Society, Borneo Street KL, Temple of Fine Arts and others, visitors and students from selected schools had the opportunity to view as well as participate in the activities such as children’s painting, drawing and colouring workshops, soap making workshops and blowpipe demonstrations.

The event was officially launched by Datin Kathleen Chew, Programme Director of YTL Foundation, YTM Raja Dato’ Seri Azureen Binti Sultan Azlan Shah, the Chairperson of Pusat Kreatif Kanak-Kanak Tuanku Bainun and Dato’ Yeoh Soo Min, Executive Director of YTL Corporation and Trustee of Traditional dance, musical performances, arts and crafts from different parts YTL Foundation (left to right) of Malaysia were showcased at the event

All proceeds from the sales of recycled flowers and reusable bamboo coffee A toy donation booth was set up to collect toys from the public for Toy cups at the event were donated to charity Libraries Malaysia to distribute to underprivileged children around Malaysia

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YTL Hotels and Save Wild Tigers (SWT) - Call of the Wild

United Kingdom O VERVIEW NAT U RAL C APITAL

A totally unique and inspiring tiger artwork was created on the exterior of the carriages, which continues to be featured on the train throughout 2020 as the train resumed its travels across Southeast Asia HU

With the support and involvement of YTL Hotels, SWT raised the Additionally, SWT supported the British Broadcasting Corporation MAN

level of awareness significantly during the “Eye on The Tiger” (BBC) in their high-impact documentary “Tigers - Hunting the C APITAL photographic exhibition at London’s iconic Royal Albert Hall in 2018, Traffickers” involving many countries across the region, had its world reaching over 100 million people globally and displayed on the high premiere in London early March 2020. Plans are being developed profile “Eastern & Oriental Tiger Express” journey in late 2019. to create focal events across Southeast Asia in 2022 to showcase the documentary which exposes the illegal tiger trade across Asia. SWT partnered with the Eastern & Oriental Express, and SWT SOCIAL AND RELATIONSHIP CAPITAL ambassador and contemporary Chinese artist, Jacky Tsai to launch the Tiger Express in late 2019. It was unveiled in Bangkok and journeyed through Malaysia to Singapore. The journey culminated with a stunning reception at the iconic Raffles Hotel, Singapore which included a YTL Hotels sponsored photo exhibition with a selection of the original photo exhibits from the Royal Albert Hall, London exhibition.

These high impact campaigns that we create are designed to inspire all. Inspiration provides the FINAN catalyst, spark and energy to seek out creative

solutions to a safer, kinder, more sustainable planet C IAL for future generations, and we thank YTL Hotels for C their continued support on this journey.” APITA Simon Clinton

L Founder of Save Wild Tigers Aldo Kane, presenter of the BBC’s “Tigers – Hunting the Traffickers” (center) with the Anti-poaching Units in Taman Negara, Malaysia

95 EMBRACING THE MARKETPLACE

Our Our Commitment Approach

Reinforcing YTL Group’s reputation as a trust-based organisation • Delivering sustainable growth through effective risk that upholds and advocates the highest ethical, sustainable management and compliance and responsible business practices • Ensuring responsible supply chain partners and procurement processes • Advocating responsible stewardship of resources, products and services • Investing in sustainable solutions and innovations • Providing a seamless customer experience to sustainably meet customers’ needs Aligned To YTL GROUP Embracing the Marketplace [GRI 102-9, 204-1, 418-1]

At YTL Group, we recognise the importance in creating sustainable RISK MANAGEMENT, ETHICS AND COMPLIANCE long-term value for stakeholders through careful planning and resource allocation. Our business performance reflects our agility and resilience, which is vital in attracting capital to fund the growth of our businesses OUR GOAL: thus making financial sustainability one of our material matters. To promote good business practices and governance whilst minimising impacts from risks

PERFORMANCE HIGHLIGHTS Our well-structured risk management and policies help us to maintain a sound risk management system to ensure significant risks are identified and adequately managed. We also seek to uphold a culture of ethics and integrity. Following the implementation of our Code of Conduct and Business Ethics (the Code) and commitment to the 100% of YTL Group employees in Malaysia United Nations Global Compact (UNGC) principles, we released a new have completed Anti-Bribery and Corruption Anti-Bribery and Corruption (ABC) policy this year to ensure that our (ABC) policy employees and others who work with us, including suppliers and contractors understand their responsibilities to comply with YTL Group’s zero tolerance for bribery and corruption within the organisation. These are made available and easily accessible on our corporate website20 for employees and the public. During the reporting year, 100% of employees in Malaysia completed the ABC training.

92% of total procument spent on local With the updated Global Privacy Policy21, we remain dedicated to vendors providing the highest standard of data security and privacy to safeguard personal data and privacy of our customers, employees and other stakeholders.

There were no material non-compliance incidents involving fraud, bribery or money laundering offences. We do not condone lobbying practices, nor do we make any political contributions. There were 100 millionth passenger on also no significant incidents of non-compliance with any relevant Express Rail Link’s (ERL) train services environmental and socio-economic laws or regulations in locations where we operate.

Further details are set out in the Corporate Governance Overview Statement and the Statement on Risk Management and Internal Control in YTL Corporation Berhad’s (YTL Corp) Annual Report 202022. 98% of customers rated Wessex Water’s service as good or very good

20 Please view the Code and ABC Policy at www.ytl.com/governance.asp 21 Please view our Global Privacy Policy at www.ytl.com/privacypolicy.asp 22 YTL Corp’s Annual Report and Corporate Governance Report 2020 can be downloaded from our website at www.ytl.com, as well as the website of Bursa Malaysia Securities Berhad at www.bursamalaysia.com

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SUSTAINABLE SUPPLY CHAIN O

OUR GOAL: VERVIEW To promote responsible and sustainable supply chains

We place great importance on supply chain management. Over the years, we have integrated sustainability elements into our procurement processes. We have a set of guidelines – the Code, ABC Policy, and The periodic assessment conducted by YTLJT reviews the performance of contractors, vendors and suppliers on human rights issues such as child labour YTL Group Corporate Statement on ethical purchasing in place, to as well as forced and compulsory labour which are regulated by the Indonesian guide our vendors to practise responsible ethics and business strategy labour laws NAT that adhere to our environment, health and safety, as well as social U RAL rights and ethics commitments. Our vendors’ performance is regularly

YTL Jawa Timur (YTLJT) conducts annual audits at their labour supply C APITAL monitored and assessed to synergise opportunities for improvement contractors’ offices to ensure they comply to all prevailing regulations through partnerships between the company and business partners related to health, safety and environment, energy management as well under the effective supply chain risk control. Any non-compliance is as compliance to local labour laws. In addition, YTLJT also conducts followed by a warning notice which may lead to penalties and/or periodic vendor assessment to review their suppliers’ performance. As termination of contract(s). a result, YTLJT has reduced and/or ceased the sourcing of chemicals that are considered harmful to the environment and currently works Sourcing Locally with licensed companies to recycle and dispose waste responsibly. HU

Our business operations in different countries allow us to add value MAN to the local economy and create employment opportunities for local The supply chain management of YTL Starhill Global REIT Management C communities. We source our raw materials locally whenever possible Limited (YSGRM), the manager of Starhill Global Real Estate Investment APITAL to support local vendors which indirectly stimulates domestic economic Trust (SGREIT) includes their property managers, tenants and suppliers growth. In our ongoing efforts to localise supply chains and improve for various services. Compliance with local government regulatory how we purchase goods and services to support good governance and legal requirements is a criterion for appointed contractors and and nation building, we are committed to collaborate with transparent, service providers. Potential tenants and suppliers are also evaluated ethical as well as socially and environmentally responsible vendors. and selected based on their reputation, track records and expertise SOC

The proportion of spending on local vendors has been steadily rising in their field to ensure common standards across SGREIT’s business IAL AND RELATI over the years and in FY2020, we spent 92% of our total procurement units. For engagements that are complex or entail high financial risk, value with local vendors. due diligence is carried out to ascertain their financial standing and track record for heightened risk. O N S

In 2018, Wessex Water performed a thorough gap analysis against HIP Proportion of Spending on Local Vendors the ISO 20400 Sustainable Procurement which was verified by an C APITAL independent expert. Taking recommendations forward, Wessex Water FY2020 92% has enhanced the good work already undertaken in the business, FY2019 91% conducted a sustainable procurement risk assessment and is working to improve their prequalification question bank for use during the FY2018 90% supplier tender process. Wessex Water is part of a utilities-wide FINANCIAL CAPITAL Note: Data covers YTL Jawa Timur, YTL PowerSeraya, Wessex Water working group in the United Kingdom (UK) with a vision to eradicate modern day slavery throughout supply chains.

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PRODUCT STEWARDSHIP AND INNOVATION

1.04 OUR GOAL: LAUNCHED millionth To provide innovative and sustainable solutions as well IN passengers as a satisfactory experience to customers 2002 in 2003

One of the most distinctive changes in markets over time has been the expansion in the choice of goods and services available to consumers. We begin with an in-depth understanding of customer expectations, and accurately develop the right products or services in order to meet the demands of the customer in each segment. We focus on solving customers’ challenges using innovation and digital technology as tools to develop high value-added products and services.

Most of our key business units are certified under ISO 9001 Quality Management Systems, ISO 14001 Environmental Management Systems, ISO 45001/OHSAS 18001 Occupational Health and Safety Management The 100 millionth passenger, Egyptian tourist Sherif Radwan presented with Systems. YTL Communications (YES), YTL Power Services and the grand prize of a trip for two to Japan. Other passengers, however, did not leave empty handed — they each received a Klook voucher to book travel YTL PowerSeraya attained ISO 27001 Information Security Management activities and services, gifts and snacks System certification, YTL Cement and YTLJT attained ISO 50001 Energy Management Systems certification, The Majestic Hotel Kuala Lumpur is certified with ISO 22000 Food Safety Management Systems, whilst YTL PowerSeraya, YSGRM and YTL Starhill Global Property Management were awarded the Project Eco-Office certification for their green practices at their workplaces.

Malaysia

Express Rail Link (ERL) – Celebrating 100 Millionth Passenger Onboard

2019 was a memorable year for ERL as they achieved a commendable milestone by hitting the 100 millionth passenger onboard the train service. The year also saw ERL introducing various initiatives benefitting family travel, solving last mile transportation issues as well as encouraging going cashless on public transport and supporting Visit Malaysia Year 2020.

GoCar Partnership • Improves mobility requirements and addresses the inconvenience of last mile transportation • Offers bundled train ticket(s) and car-sharing services to and from KLIA and KLIA2 with GoCar at selected ERL stations

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50 75 100 O

millionth millionth millionth VERVIEW passenger passenger passenger Kids Travel Free in 2014 in August 2016 in July 2019 • Encourages families to travel through affordable public transport and minimise their carbon footprint • Children below six years old travel for free when accompanied by a fare paying adult passenger (previously below two) • Older children are charged adult fares only if they are 16 years or older (previously above 13) NAT U RAL C APITAL HU MAN C APITAL SOC Go Cashless 2.0 • Provides seamless, safe and convenient cashless payment solution IAL AND RELATI • Widens the acceptance of contactless cards, e-wallets at counters and online • Organises cashless promotions in collaboration with partners to boost the conversion to cashless transactions O N S HIP C APITAL FINANCIAL CAPITAL

Visit Malaysia 2020 • Supports the government in achieving the campaign target of 30 million tourist arrivals • Holds cultural performances by National Department for Culture and Arts as a welcome gesture for foreign and domestic travellers • Campaign cancelled due to COVID-19 pandemic

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YTL Land & Development (YTL L&D) – The Way Forward for Green Design

Menara YTL, the new headquarters for YTL Group of companies developed by YTL L&D, was completed in 2019 and awarded the Gold Rating by the Green Building Index (GBI) accreditation panel.

The 41-storey tower at Jalan Bukit Bintang marks an inspiration for new benchmarks in innovative design and sustainable energy concepts. Its distinctive glass façade employing sleek and slim eye-catching design elements and a “crystal” finish is achieved through artfully folded glass, to create a gem-like effect with variations in light reflection and contrasting textures.

From the onset, YTL L&D has established clear goals to reduce energy consumption in line with their commitment to sustainable development. The building employs effective controls and intelligent building management systems as well as energy efficient and eco-friendly equipment such as carbon dioxide (CO2) sensors to control outdoor air intake, daylight and motion sensors for control of lighting, regenerative drive lifts, photoelectric sensors for window perimeters of office areas and carbon monoxide (CO) sensors in the car park.

Menara YTL

Energy Efficiency Makes use of double-glazed windows for better heat insulation, motion-sensing LED lighting, variable speed drive machines as well as a heat recovery technology to achieve better energy efficiency and reduced energy wastage

Water Efficiency Water efficient fittings as well as digital water meters connected to the building management system installed to improve water efficiency. A rainwater harvesting system has also been installed to collect non-potable water and reduce stormwater runoff

High Ratio of Open Space to Development Footprint Almost 50% of the site area (excluding the building footprint) is dedicated to calming green areas and attractive landscaping

Zero Ozone Depletion Potential Refrigerant Use of non-CFC refrigerant in air-conditioners which is more environmentally friendly and protects the health and well- being of employees

Thermal Comfort Workplace Utilises a combination of demand-controlled ventilation systems and temperature control sensors to promote energy savings and appropriate comfort levels for employees

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YTL Communications (YES) – Technology Advancement in Connectivity

YES is leading the way in developing ground-breaking projects as well as reimagining digital services and strategies which deliver a sound Internet surfing experience for the public. YES first launched Asia’s Terragraph trial in Georgetown, Penang in 2018 and following up in 2019, O the Gigawire trial was launched in Kuala Lumpur. These initiatives are in line with the government’s vision of the National Fiberisation and VERVIEW Connectivity Plan (NFCP) 2019-2023, aiming to improve broadband quality and coverage, reducing broadband prices and enabling Internet access for all. As a result, YES clinched the Connectivity – Telecommunications trophy at the inaugural Malaysia Technology Excellence Awards 2019.

YES Terragraph and Gigawire Trial

Collaboration between YES Terragraph FixedFixed WWirelessireless AccesAccesss and Facebook Connectivity, Network • 120 parties benefittedbenefitted NAT with support from Penang U

• 50-172x50-172x Internet speedspeed RAL State Government to resolve • 93% positivepositive ratingrating C

the urban network bandwidth APITAL challenge in high-density cities How it works?

1. Distribution nodes deployed on street level Free Public WiFi furniture • 472 YES Terragraph

nodes over 50 locations 2. YES Terragraph nodes HU • 33,000 unique users with a providing connectivity to MAN 75% retention rate over C

WiFi and small cells APITAL • Peak Download Speed: 200 megabits per second (Mbps) 3. Ethernet access brought • Peak Upload Speed: 160 Mbps to buildings SOC Introduced by YES to Gigawire IAL AND RELATI modernise existing copper Technology AP cable buildings to deliver fixed high-speed broadband IP TV without the need to rewire O

existing structure N S

Currently working HIP PC

on technology C Terragraph / Fibre / Microwave APITAL Copper integration between Telephony Ethernet Gigawire and Terragraph in Penang to enable buildings with AP existing copper wire FINANCIAL CAPITAL cables to receive faster One of the test building IP TV broadband service managed to reach more than 800 Mbps as opposed to legacy PC technology that clocks around one Mbps Telephony Gigawire equipment

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Singapore

YTL PowerSeraya – Fraud Risk Management

As part of YTL PowerSeraya's fraud risk management, the Enterprise Risk Management Department conducted the Spent Risk Analysis (SRA) as well as an audit of IT-related transactions. Both audits, which covered the operations of the three company sites (corporate office, Pulau Seraya Power Station and Jurong Power Station) did not identify any incidence of fraudulent transactions made in FY2020.

The SRA involved the internal audit of the procurement and payment processes to ascertain that there were no unauthorised transactions such as duplicate payments and invoices billed before purchase orders were raised. The internal audit of IT-related transactions sought to determine if there were any unauthorised IT requests or release management of IT systems (e.g. billing systems, customer relationship management and trading systems) that would have financial implications or impacts on customers.

Starhill Global REIT (SGREIT) - Satisfactory Tenant with Us

Customer satisfaction plays an important role towards business success. Surpassing customer expectations by measuring and improving customer satisfaction helps to maintain long-term relationships with customers and attract new customers in competitive business environments. YTL Starhill Global REIT Management Limited (YSGRM), the manager of SGREIT conducts a survey on the satisfaction of tenants annually to gather feedback in order to analyse and identify potential gaps, areas of improvement and appropriate follow-up actions, in addition to measuring various metrics of performance.

To help tenants through the business disruption due to the COVID-19 pandemic, total rental rebates for eligible tenants in SGREIT's portfolio, including an allowance for rental arrears and rebates for Australian tenants, amounting to approximately SGD32.2 million was recorded in FY2020. The aggregate amount also includes approximately SGD15.2 million of property tax rebates23 for eligible tenants and estimated cash grants24 for eligible small and medium enterprises (SMEs), both funded by the Singapore Government.

In addition, we listen to feedback from our tenants and formulate constructive efforts from there. In FY2020, 176 customer satisfaction surveys were sent to office and retail tenants and 82.8% of 87 tenants who responded were satisfied with the services rendered.

YSGRM’s Extended Support and Precautionary Measures During the COVID-19 Pandemic

Extended Support for its Tenants Precautionary Measures for the Public

Deployment of cleaning and disinfecting robots using advanced Ultraviolet-C (UV- C) technology for more frequent cleaning and disinfection to create a safe environment Rental rebates and assistance Travel declaration, temperature screening and queue management Marketing assistance Installation of photocatalytic and UV-C light in the air handling units (AHUs) to provide clean indoor air Flexibility on operating hours Application of antivirus, antimicrobial and antifungal coating spray onto high- Free parking and promotional offers touch points such as lift buttons and escalator handrails

Equipping all sliding doors with auto-sensor capabilities for contactless entry

Temperature screening for all customers and visitors with queue management Antivirus, antimicrobial and antifungal coating applied onto escalator handrails as well as digital check-ins and check-outs for contact tracing purposes and lift buttons

23 Property tax rebate as per the Budget 2020 announced by the Singapore Government on 18 February 2020 and the Resilience Budget announced on 26 March 2020 24 The Government announced on 26 May 2020 as part of the Fortitude Budget, a Government cash grant to qualifying property owners that would provide relief for SMEs operating in qualifying non-residential properties 104 SUSTAINABILITY REPORT 2020

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United Kingdom Industry Leading Customer Service

Achieved top spot in Ofwat’s25 efficiency ranking, Wessex Water – Going the Extra Mile for Our Customers delivered industry leading customer service and operational O VERVIEW This year, Wessex Water announced their business plan for the period performance, returned to “industry leading” status in 2020 to 2025 after consultation with more than 140,000 customers the Environment Agency’s environmental performance through surveys and independent focus groups to gather their views assessment on bills and services. With a staggering GBP1.4 billion investment, 98% of customers rated Wessex Water’s service as Wessex Water strives to deliver the best overall customer and good or very good. The Customer Service Excellence environmental service levels in the industry in the areas that matter Award was renewed for the fourth time most to customers, including: drinking water quality, avoiding pollution, supply interruptions and customer service. Wessex Water also aims Fewest complaints per 10,000 customers of any water to provide affordable bills for every household by adjusting the bills and sewerage company for the ninth year running NAT based on the ability to pay, for those on lower incomes and by helping 83% of customers reviewing Wessex Water on U all customers save water. Through working with partners, Wessex consumer review website Trustpilot®26 gave the company RAL

Water also assists their customers to reduce other utility bills by a five-star rating C APITAL helping the customers to reduce energy use.

The Tailored Assistance Programme (tap) offers tailored solutions to 3D LiDAR Modelling of Tunnels in Semi-turbulent Flow customers with affordability problems through a range of schemes, and low rate tariffs to help them with their charges and to repay Wessex Water believes that driving innovation could help to debts, along with practical tips to reduce water and energy use. Over optimise their operations and resolve some of the difficulties 14,000 customers are receiving discounts of up to 90% through the they faced. Last year, Wessex Water’s efforts in innovation

main social tariff, Assist, and more than 20,000 low income pensioners resulted in a way to utilise robotic technology in trenchless HU receive discounts of around 20% on their bills through the Pension sewer repairs called, the “Re-rounder”. This year, Wessex Water MAN Credit Discount. The affordability assistance and partnering with the went further and collaborated with Headlight Artificial Intelligence C debt advice sector will become more important over the coming months (AI) to develop and innovate a solution for the survey and APITAL as the economy attempts to recover from the impacts of the COVID-19 modelling of sewer tunnels with Light Detection and Ranging pandemic. Wessex Water has been supporting customers in the short (LiDAR) technology. term with payment holidays or lower value payment plans, but they • Aims to mathematically discount the effects of turbulent expect more to seek their help and support to get back on track through flow and avoid man-entry, which traditionally is an expensive, lower rate tariffs and debt repayment schemes. For the frontline, dangerous and time-consuming task. SOC uniformed National Health Service (NHS) workers, the company offered IAL AND RELATI a GBP50 bill rebate to offset their additional laundering costs. More • The innovative collaboration has won Wessex Water the UK than 10,000 key NHS employees have signed up for this rebate. Institute of Water South West Area Innovation Awards 2020 and second place for the UK Institute of Water 2020 National Innovation Awards. O N S HIP C APITAL

Step 1: Step 2:

Deploying a multi-sensor system The data collected processed FINANCIAL CAPITAL on a floating platform in a large to account for the motion of the critical sewer to conduct a high system and utilising AI to obtain accuracy 3D survey of the asset insights into the sewer’s condition in semi-turbulent flow to identify defects in a faster and Currently, tap is helping more than 47,000 customers, marking an increase of more accurate manner 9% against the previous year

25 Ofwat is the Water Services Regulation Authority that is responsible for economic regulation of the privatised water and sewerage industry in England and Wales 26 Trustpilot is an independent online ratings service. www.trustpilot.com

105 YTL GROUP GRI Content Index [GRI 102-55]

CUSTOM CONTENT INDEX – ‘IN ACCORDANCE’ CORE

This Content Index provides an overview of the GRI Standards Disclosures made in this report and the YTL Corporation Berhad Annual Report 2020.

GRI Standards Description Page GRI 102: GENERAL DISCLOSURES ORGANISATIONAL PROFILE 102-1 Name of the organisation 01 102-2 Activities, brands, products, and services Annual Report 102-3 Location of headquarters Annual Report 102-4 Location of operations Annual Report 102-5 Ownership and legal form Annual Report 102-6 Markets served Annual Report 102-7 Scale of the organisation Annual Report 102-8 Information on employees and other workers 52 102-9 Supply chain 99 102-10 Significant changes to the organisation and its supply chain 08 102-11 Precautionary Principle or approach 11 102-12 External initiatives 08 102-13 Membership of associations 08 STRATEGY 102-14 Statement from senior decision-maker 02-07 ETHICS AND INTEGRITY 102-16 Values, principles, standards, and norms of behaviour 10 GOVERNANCE 102-18 Governance structure 11 STAKEHOLDERS ENGAGEMENT 102-40 List of stakeholder groups 12 102-42 Identifying and selecting stakeholders 12 102-43 Approach to stakeholder engagement 12 102-44 Key topics and concerns raised 12 REPORTING PRACTICE 102-45 Entities included in the consolidated financial statements Annual Report, 01 102-46 Defining report content and topic Boundaries 01 102-47 List of material topics 13 102-48 Restatements of information No restatements were made 102-49 Changes in reporting 13 102-50 Reporting period 01 102-51 Date of most recent report 01 102-52 Reporting cycle 01 102-53 Contact point for questions regarding the report 01 102-54 Claims of reporting in accordance with the GRI Standards 01 102-55 GRI content index 106 102-56 External assurance No external assurance was made

106 SUSTAINABILITY REPORT 2020

GRI Content Index

SPECIFIC STANDARD DISCLOSURES

GRI Standards Description Page GRI 200: ECONOMIC GRI 201: ECONOMIC PERFORMANCE 103 Management approach disclosures 55-56 201-1 Direct economic value generated and distributed Annual Report, 08 201-3 Defined benefit plan obligations and other retirement plans 55-56 GRI 202: MARKET PRESENCE 103 Management approach disclosures 52 202-2 Proportion of senior management hired from the local community 52 GRI 204: PROCUREMENT PRACTICES 103 Management approach disclosures 99 204-1 Proportion of spending on local suppliers 98-99 GRI 300: ENVIRONMENTAL GRI 302: ENERGY 103 Management approach disclosures 16,30-35 302-1 Energy consumption within the organisation 30 302-2 Energy consumption outside of the organisation 30 302-4 Reduction of energy consumption 30-35 GRI 303: WATER AND EFFLUENTS 103 Management approach disclosures 16,44-49 303-3 Water withdrawal 44 303-5 Water consumption 45 GRI 304: BIODIVERSITY 103 Management approach disclosures 16-24 304-1 Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high 16-24 biodiversity value outside protected areas 304-2 Significant impacts of activities, products, and services on biodiversity 16-24 304-3 Habitats protected or restored 16-24 304-4 IUCN Red List species and national conservation list species with habitats in areas affected by 16-24 operations GRI 305: EMISSIONS 103 Management approach disclosures 16,26-29 305-1 Direct (Scope 1) greenhouse gas (GHG) emissions 27 305-2 Energy indirect (Scope 2) greenhouse gas (GHG) emissions 27 305-3 Other indirect (Scope 3) greenhouse gas (GHG) emissions 27 305-4 GHG emissions intensity 27 305-5 Reduction of GHG emissions 28-35,38,42-43 305-7 Nitrogen oxides (NOx), sulphur oxides (SOx), and other significant air emissions 25 GRI 306: WASTE 103 Management approach disclosures 16,36-43 306-1 Waste generation and significant waste-related impacts 36-43 306-2 Management of significant waste-related impacts 36-43 306-3 Waste generated 36-37 306-4 Waste diverted from disposal 36-37

107 YTL GROUP

GRI Content Index

GRI Standards Description Page GRI 307: ENVIRONMENTAL COMPLIANCE 103 Management approach disclosures 25 307-1 Non-compliance with environmental laws and regulations 25 GRI 400: SOCIAL GRI 401: EMPLOYMENT 103 Management approach disclosures 52-65 401-1 New employee hires and employee turnover 52 401-2 Benefits provided to full-time employees that are not provided to temporary or part-time employees 55-56 401-3 Parental leave 55 GRI 402: LABOUR/MANAGEMENT RELATIONS 103 Management approach disclosures 55 402-1 Minimum notice periods regarding operational changes 55 GRI 403: OCCUPATIONAL HEALTH AND SAFETY 103 Management approach disclosures 61-65 403-1 Occupational health and safety management system 61-65 403-4 Worker participation, consultation, and communication on occupational health and safety 61,63-65 403-5 Worker training on occupational health and safety 63-65 403-9 Work-related injuries 62 GRI 404: TRAINING AND EDUCATION 103 Management approach disclosures 56-60 404-1 Average hours of training per year per employee 57 404-2 Programmes for upgrading employee skills and transition assistance programmes 56-57 404-3 Percentage of employees receiving regular performance and career development reviews 55 GRI 405: DIVERSITY AND EQUAL OPPORTUNITY 103 Management approach disclosures 52 405-1 Diversity of governance bodies and employees 52 GRI 408: CHILD LABOUR 103 Management approach disclosures 52-53 408-1 Operations and suppliers at significant risk for incidents of child labour 52-53 GRI 409: FORCED OR COMPULSORY LABOUR 103 Management approach disclosures 52-53 409-1 Operations and suppliers at significant risk for incidents of forced or compulsory labour 52-53 GRI 413: LOCAL COMMUNITIES 103 Management approach disclosures 68-95 413-1 Operations with local community engagement, impact assessments, and development programmes 68-95 413-2 Operations with significant actual and potential negative impacts on local communities 68-95 GRI 418: CUSTOMER PRIVACY 103 Management approach disclosures 98 418-1 Substantiated complaints concerning breaches of customer privacy and losses of customer data 98

108 HOME ENERGY SAVING TIPS

Consider installing Unplug your phone charger a solar water heater Do not leave your mobile phone One of the most effective plugged in overnight. It only ways to cut energy bills is to Use natural light when takes a couple of hours for a generate your own energy. possible full charge. A solar water heater is 50% A single window facing the sun more efficient than gas or can illuminate 20 to 100 times its electric water heaters. area, so switch off the lights and maximise the use of natural light.

Reduce energy for water heating Manage power settings Take simple steps such as Set the power lowering your water management settings of heater’s temperature your computer to Energy and installing low-flow Saver Mode and get rid of shower heads. the screen saver. This cuts energy consumption and prolongs the computer’s battery life! Use cold water when washing your clothes This not only extends the lifespan and vibrancy of your clothing, but also saves 90% of the energy that would have been used to heat the water.

Unplug unused devices or install a power strip to cut off standby power Vampire or phantom energy is the electricity that electronics pull from the outlet while plugged in, even when the device is off and it can use Swap to LED bulbs as much as 10% of your home’s energy. LED bulbs are 90% more efficient, contain no harmful gases, and can last more than ten years!

Refrigerate at the right level Set your refrigerator temperature to the manufacturer's recommended level to avoid excessive cooling. Switch off unnecessary power Switch off everything before heading out the door, such as Source: lights, bathroom vents, www.directenergy.com/learning-center/25-energy-efficiency-tips computers and televisions. www.bchydro.com/powersmart/residential/savings-and-rebates/everyday-electricity-saving-tips.html?WT.mc_id=rd_21tips www.green.harvard.edu/tools-resources/green-tip/top-10-home-energy-saving-tips#:~:text=2.,used%20to%20heat%20the%20water

Be Part of the Solution by starting with energy saving at your home. Together we can help in Making a Good Future Happen. YTL CORPORATION BERHAD 198201012898 (92647-H)

33rd Floor, Menara YTL 205 Jalan Bukit Bintang 55100 Kuala Lumpur Malaysia

Tel • 603 2038 0888 Fax • 603 2038 0388

www.ytl.com www.ytl.com/sustainability www.ytlcommunity.com

CORPORATE GOVERNANCE REPORT

STOCK CODE : 4677 COMPANY NAME : YTL Corporation Berhad FINANCIAL YEAR : June 30, 2020

OUTLINE:

SECTION A – DISCLOSURE ON MALAYSIAN CODE ON CORPORATE GOVERNANCE Disclosures in this section are pursuant to Paragraph 15.25 of Bursa Malaysia Listing Requirements.

SECTION B – DISCLOSURES ON CORPORATE GOVERNANCE PRACTICES PERSUANT CORPORATE GOVERNANCE GUIDELINES ISSUED BY BANK NEGARA MALAYSIA Disclosures in this section are pursuant to Appendix 4 (Corporate Governance Disclosures) of the Corporate Governance Guidelines issued by Bank Negara Malaysia. This section is only applicable for financial institutions or any other institutions that are listed on the Exchange that are required to comply with the above Guidelines.

1

SECTION A – DISCLOSURE ON MALAYSIAN CODE ON CORPORATE GOVERNANCE

Disclosures in this section are pursuant to Paragraph 15.25 of Bursa Malaysia Listing Requirements.

Intended Outcome Every company is headed by a board, which assumes responsibility for the company’s leadership and is collectively responsible for meeting the objectives and goals of the company.

Practice 1.1 The board should set the company’s strategic aims, ensure that the necessary resources are in place for the company to meet its objectives and review management performance. The board should set the company’s values and standards, and ensure that its obligations to its shareholders and other stakeholders are understood and met.

Application : Applied

Explanation on : The Board of Directors (“Board”) of YTL Corporation Berhad (“YTL Corp” application of the or “Company”) remains firmly committed to ensuring an appropriate and practice sound system of corporate governance throughout the Company and its subsidiaries (“YTL Corp Group”).

The YTL Corp Group’s corporate governance structure is a fundamental part of the Board’s responsibility to protect and enhance long-term shareholder value and the financial performance of the YTL Corp Group, whilst taking into account the interests of all stakeholders.

YTL Corp is led and managed by an experienced Board with a wide and varied range of expertise to address and manage the complexity and scale of the operations of YTL Corp Group.

This broad spectrum of skills and experience ensures the YTL Corp Group is under the guidance of an accountable and competent Board. The Directors recognise the key role they play in charting the strategic direction, development and control of the YTL Corp Group.

Key elements of the Board’s stewardship responsibilities include:

▪ Reviewing and adopting strategic plans for the YTL Corp Group to ensure long-term, sustainable value creation for the benefit of its stakeholders; ▪ Overseeing the conduct of the YTL Corp Group’s business operations and financial performance, including the economic, environmental and social impacts of its operations; ▪ Identifying and understanding the principal risks affecting the YTL Corp Group’s businesses in order to determine the appropriate risk appetite within which management is expected to operate ▪ Maintaining a sound risk management and internal control framework, supported by appropriate mitigation measures; ▪ Succession planning; and ▪ Overseeing the development and implementation of shareholder communications policies.

2

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

3

Intended Outcome Every company is headed by a board, which assumes responsibility for the company’s leadership and is collectively responsible for meeting the objectives and goals of the company.

Practice 1.2 A Chairman of the board who is responsible for instilling good corporate governance practices, leadership and effectiveness of the board is appointed.

Application : Applied

Explanation on : The Board is led by the Chairman who is responsible for instilling good application of the corporate governance practices, leadership and effectiveness of the practice Board.

The Chairman is responsible for leadership of the Board in ensuring the effectiveness of all aspects of its role, and is primarily responsible for leading the Board in setting the values and standards of the Company, the orderly and effective conduct of the meetings of the Board and shareholders, maintaining a relationship of trust with and between the Executive and Non-Executive Directors, ensuring the provision of accurate, timely and clear information to Directors, facilitating the effective contribution of Non-Executive Directors and ensuring that constructive relations are maintained between Executive and Non- Executive Directors.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

4

Intended Outcome Every company is headed by a board, which assumes responsibility for the company’s leadership and is collectively responsible for meeting the objectives and goals of the company.

Practice 1.3 The positions of Chairman and CEO are held by different individuals.

Application : Applied

Explanation on : There is a balance of power, authority and accountability between the application of the Executive Chairman, Tan Sri Dato’ (Dr) Francis Yeoh Sock Ping, and the practice Managing Director, Dato’ Yeoh Seok Kian, with a clear division of responsibility between the running of the Board and the Company's business respectively. The positions of Executive Chairman and Managing Director are separate and clearly defined, and are held by different members of the Board.

The Managing Director is responsible for, amongst others, overseeing the day-to-day running of the business, implementation of Board policies and strategies, and making of operational decisions, serving as the conduit between the Board and the Management in ensuring the success of the Company's governance and management functions, ensuring effective communication with shareholders and relevant stakeholders, providing strong leadership, i.e., effectively communicating the vision, management philosophy and business strategy to employees, and keeping the Board informed of salient aspects and issues concerning the Group's operations.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

5

Intended Outcome Every company is headed by a board, which assumes responsibility for the company’s leadership and is collectively responsible for meeting the objectives and goals of the company.

Practice 1.4 The board is supported by a suitably qualified and competent Company Secretary to provide sound governance advice, ensure adherence to rules and procedures, and advocate adoption of corporate governance best practices.

Application : Applied

Explanation on : The Board is supported by a professionally qualified and competent application of the Company Secretary. The Company Secretary, Ms Ho Say Keng, is a practice Fellow of the Chartered Association of Certified Accountants, a registered member of the Malaysian Institute of Accountants and an affiliate member of the Malaysian Institute of Chartered Secretaries and Administrators, and is qualified to act as Company Secretary under Section 235(2)(a) of the Companies Act 2016.

The Company Secretary ensures that Board procedures are adhered to at all times during meetings and advises the Board on matters including corporate governance issues and the Directors’ responsibilities in complying with relevant legislation and regulations. The Company Secretary works very closely with Management for timely and appropriate information, which will then be passed on to the Directors. In accordance with the Board’s procedures, deliberations and conclusions in Board meetings are recorded by the Company Secretary, who ensures that accurate and proper records of the proceedings of Board meetings and resolutions passed are recorded and kept in the statutory register at the registered office of the Company.

During the financial year under review, the Company Secretary attended training, seminars and regulatory briefings and updates relevant for the effective discharge of her duties. The Company Secretary also carried out an ongoing review of existing practices in comparison with the new measures introduced in the Code.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

6

Intended Outcome Every company is headed by a board, which assumes responsibility for the company’s leadership and is collectively responsible for meeting the objectives and goals of the company.

Practice 1.5 Directors receive meeting materials, which are complete and accurate within a reasonable period prior to the meeting. Upon conclusion of the meeting, the minutes are circulated in a timely manner.

Application : Applied

Explanation on : Board meetings are scheduled with due notice in advance at least 5 application of the times in a year in order to review and approve the annual and interim practice financial results. Additional meetings may also be convened on an ad- hoc basis when significant issues arise relating to the YTL Corp Group and when necessary to review the progress of its operating subsidiaries in achieving their strategic goals. The Board met 5 times during the financial year ended 30 June 2020.

The Directors have full and unrestricted access to all information pertaining to the YTL Corp Group’s business and affairs to enable them to discharge their duties. At least one week prior to each Board meeting, all Directors receive the agenda together with a comprehensive set of Board papers encompassing qualitative and quantitative information relevant to the business of the meeting. This allows the Directors to obtain further explanations or clarifications, where necessary, in order to be properly briefed before each meeting.

Board papers are presented in a consistent, concise and comprehensive format, and include, where relevant to the proposal put forward for the Board’s deliberation, approval or knowledge, progress reports on the YTL Corp Group’s operations and detailed information on corporate proposals, major fund-raising exercises and significant acquisitions and disposals. Where necessary or prudent, professional advisers may be on hand to provide further information and respond directly to Directors’ queries. In order to maintain confidentiality, Board papers on issues that are deemed to be price-sensitive may be handed out to Directors during the Board meeting.

The minutes of the Board and/or Board Committee meetings are circulated and confirmed at the next meeting. Once confirmed, the minutes of the Board Committee meetings are subsequently presented to the Board for notation.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

7

Timeframe :

8

Intended Outcome There is demarcation of responsibilities between the board, board committees and management.

There is clarity in the authority of the board, its committees and individual directors.

Practice 2.1 The board has a board charter which is periodically reviewed and published on the company’s website. The board charter clearly identifies– ▪ the respective roles and responsibilities of the board, board committees, individual directors and management; and ▪ issues and decisions reserved for the board.

Application : Applied

Explanation on : The Board’s functions are governed and regulated by its Charter, the application of the Constitution of the Company and the various applicable legislation, practice Listing Requirements and other regulations and codes.

The Board’s Charter was formalised during the financial year ended 30 June 2014 and a copy can be found under the “Governance” section on the Company’s website at www.ytl.com. The Board Charter clearly sets out the role and responsibilities of the Board, Board committees, Directors and Management and the issues and decisions reserved for the Board. The Board Charter is reviewed and updated periodically when necessary.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

9

Intended Outcome The board is committed to promoting good business conduct and maintaining a healthy corporate culture that engenders integrity, transparency and fairness.

The board, management, employees and other stakeholders are clear on what is considered acceptable behaviour and practice in the company.

Practice 3.1 The board establishes a Code of Conduct and Ethics for the company, and together with management implements its policies and procedures, which include managing conflicts of interest, preventing the abuse of power, corruption, insider trading and money laundering.

The Code of Conduct and Ethics is published on the company’s website.

Application : Applied

Explanation on : The Code of Conduct and Business Ethics was formalised by the YTL application of the Group of Companies during the last financial year 30 June 2019 and practice further updated during the current year under review, following the adoption and implementation of the YTL Group’s Anti-Bribery and Corruption Policy. Copies of the Code of Conduct and Business Ethics and the Anti-Bribery and Corruption Policy can be found on the Company’s website at www.ytl.com.

The Directors also observe and adhere to the Code of Ethics for Company Directors established by the Companies Commission of Malaysia, which encompasses the formulation of corporate accountability standards in order to establish an ethical corporate environment. YTL Corp has an established track record for good governance and ethical conduct.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

10

Intended Outcome The board is committed to promoting good business conduct and maintaining a healthy corporate culture that engenders integrity, transparency and fairness.

The board, management, employees and other stakeholders are clear on what is considered acceptable behaviour and practice in the company.

Practice 3.2 The board establishes, reviews and together with management implements policies and procedures on whistleblowing.

Application : Applied

Explanation on : The Code of Conduct and Business Ethics, which also sets out the application of the whistleblowing policy and procedures, was formalised by the YTL Group practice of Companies during the last financial year 30 June 2019 and further updated during the current year under review, following the adoption and implementation of the YTL Group’s Anti-Bribery and Corruption Policy. Copies of the Code of Conduct and Business Ethics and the Anti-Bribery and Corruption Policy can be found on the Company’s website at www.ytl.com.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

11

Intended Outcome Board decisions are made objectively in the best interests of the company taking into account diverse perspectives and insights.

Practice 4.1 At least half of the board comprises independent directors. For Large Companies, the board comprises a majority independent directors.

Application : Departure

Explanation on : application of the practice

Explanation for : During the financial year under review there was one resignation from departure the Board namely the late Mr Eu Peng Meng @ Leslie Eu. Subsequently, on 5 September 2019, Puan Raja Noorma Binti Raja Othman was appointed to the Board.

The Board currently has 12 Directors, comprising 8 executive members and 4 independent non-executive members. The Independent Directors comprise 33.3% of the Board, providing an effective check and balance in the functioning of the Board, and in compliance with the Listing Requirements, which require one-third of the Board to be independent.

The Directors are cognisant of the recommendation in the Code for the Board to comprise a majority of independent directors, and will assess the composition and size of the Board on an ongoing basis to ensure the needs of the Company are met.

YTL Corp is 50.02%-owned by Yeoh Tiong Lay & Sons Holdings Sdn Bhd (as at 30 June 2020). The Executive Directors are appointed by the major shareholder in accordance with its rights under the Companies Act 2016 and the Constitution of the Company. The interests of the major shareholder are fully aligned with those of all shareholders of the Company.

YTL Corp is majority-owned by a single shareholder, unlike other listed companies that may have a dispersed shareholder base which enables a shareholder to exercise control despite holding a minority stake.

The expertise and experience in both the day-to-day running of the Group’s businesses and the determination and setting of its broader strategy, lies with the Executive Directors in order to ensure the ongoing ability to fulfil their roles and responsibilities as stewards of the Group’s businesses.

Nevertheless, the Company has in place appropriate and rigorous governance structures and internal controls necessary to safeguard the assets of the Group and protect shareholder value. There is robust oversight in the form of the Board’s Audit, Remuneration and Nominating committees, all of which are chaired by and comprise solely Independent Non-Executive Directors.

The Board is of the view that the current Independent Non-Executive Directors have the experience and business acumen necessary to carry sufficient weight in the Board’s decisions, and act in the best interests of the shareholders.

12

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure : Ongoing review of the composition of the board.

Timeframe : Others Ongoing

13

Intended Outcome Board decisions are made objectively in the best interests of the company taking into account diverse perspectives and insights.

Practice 4.2 The tenure of an independent director does not exceed a cumulative term limit of nine years. Upon completion of the nine years, an independent director may continue to serve on the board as a non-independent director.

If the board intends to retain an independent director beyond nine years, it should justify and seek annual shareholders’ approval. If the board continues to retain the independent director after the twelfth year, the board should seek annual shareholders’ approval through a two-tier voting process.

Application : Applied - Annual shareholders' approval for independent directors serving beyond 9 years Explanation on : There is currently one Independent Non-Executive Director, Dato’ application of the Cheong Keap Tai, who has served on the Board for a period exceeding practice the nine-year term limit recommended in the Code. In accordance with current practice, approval through a vote of all shareholders via the single-tier voting process will continue to be sought at the forthcoming 37th Annual General Meeting (“AGM”) of YTL Corp for Dato’ Cheong Keap Tai to continue to serve as an Independent Non-Executive Director.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

14

Intended Outcome Board decisions are made objectively in the best interests of the company taking into account diverse perspectives and insights.

Practice 4.3 - Step Up The board has a policy which limits the tenure of its independent directors to nine years.

Application : Not Adopted

Explanation on : adoption of the practice

15

Intended Outcome Board decisions are made objectively in the best interests of the company taking into account diverse perspectives and insights.

Practice 4.4 Appointment of board and senior management are based on objective criteria, merit and with due regard for diversity in skills, experience, age, cultural background and gender.

Application : Applied

Explanation on : The Nominating Committee is chaired by an Independent Non-Executive application of the Director and is responsible for assessing suitable candidates for practice appointment to the Board for approval, with due regard for diversity, taking into account the required mix of skills, experience, age, gender, ethnicity, background and perspective of members of the Board before submitting its recommendation to the Board for decision.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

16

Intended Outcome Board decisions are made objectively in the best interests of the company taking into account diverse perspectives and insights.

Practice 4.5 The board discloses in its annual report the company’s policies on gender diversity, its targets and measures to meet those targets. For Large Companies, the board must have at least 30% women directors.

Application : Applied

Explanation on : As the Board’s overriding aim is to maintain a strong and effective Board, application of the it seeks to ensure that all appointments are made on merit, taking into practice account the collective balance of elements such as skills, experience, age, gender, ethnicity, background and perspective. The Board recognises the importance of encouraging and developing female talent at all levels, and has a strong complement of female divisional heads and chief executive officers.

Currently, there are three female directors on the Board comprising 25% of the Board and, therefore, whilst the Board has not met the target of 30% women directors set out in the Code it will continue to seek diverse Board members of the highest calibre with the necessary strength, experience and skills to meet the needs of the YTL Corp Group.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

17

Intended Outcome Board decisions are made objectively in the best interests of the company taking into account diverse perspectives and insights.

Practice 4.6 In identifying candidates for appointment of directors, the board does not solely rely on recommendations from existing board members, management or major shareholders. The board utilises independent sources to identify suitably qualified candidates.

Application : Departure

Explanation on : application of the practice

Explanation for : The Nominating Committee is responsible for assessing suitable departure candidates for appointment to the Board for approval, taking into account the required mix of skills, diversity, experience and expertise of members of the Board before submitting its recommendation to the Board for decision. The Nominating Committee is chaired by and comprises solely Independent Non-Executive Directors.

Whilst it has, to date, not been necessary to do so given the expertise of the Independent Non-Executive Directors, the Board will also endeavour to utilise independent sources including external human resources consultants and specialised databases, as appropriate.

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure : As stated above

Timeframe : Others Ongoing

18

Intended Outcome Board decisions are made objectively in the best interests of the company taking into account diverse perspectives and insights.

Practice 4.7 The Nominating Committee is chaired by an Independent Director or the Senior Independent Director.

Application : Applied

Explanation on : The Nominating Committee is chaired by an Independent Director, En application of the Faiz Bin Ishak practice

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

19

Intended Outcome Stakeholders are able to form an opinion on the overall effectiveness of the board and individual directors.

Practice 5.1 The board should undertake a formal and objective annual evaluation to determine the effectiveness of the board, its committees and each individual director. The board should disclose how the assessment was carried out and its outcome.

For Large Companies, the board engages independent experts periodically to facilitate objective and candid board evaluations.

Application : Applied

Explanation on : Annual evaluation of the Board as a whole, Board Committees and the application of the individual Directors is carried out by the Nominating Committee. The practice evaluation carried out during the financial year under review involved an annual assessment of the effectiveness of each individual Director and the Board as a whole with the objectives of assessing whether the Board and the Directors had effectively performed its/their roles and fulfilled its/their responsibilities, and devoted sufficient time commitment to the Company’s affairs, in addition to recommending areas for improvement.

The assessment exercise was facilitated by the Company Secretary and took the form of completion of questionnaires/evaluation forms comprising a Board and Nominating Committee Effectiveness Evaluation Form, Individual Director Performance Evaluation Form, Independent Directors’ Evaluation Form, Audit Committee Effectiveness Evaluation Form and Audit Committee Members Evaluation by Nominating Committee Form.

As recommended in the Code, the Board will endeavour to utilise independent experts to facilitate the evaluation process, as and when appropriate. Further information on the activities of the Nominating Committee can be found in the Nominating Committee Statement set out in the Annual Report. This information is also available under the “Governance” section on the Company’s website at www.ytl.com.

Explanation for : departure

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Timeframe :

20

Intended Outcome The level and composition of remuneration of directors and senior management take into account the company’s desire to attract and retain the right talent in the board and senior management to drive the company’s long-term objectives.

Remuneration policies and decisions are made through a transparent and independent process.

Practice 6.1 The board has in place policies and procedures to determine the remuneration of directors and senior management, which takes into account the demands, complexities and performance of the company as well as skills and experience required. The policies and procedures are periodically reviewed and made available on the company’s website.

Application : Applied

Explanation on : Directors’ remuneration is decided in line with the objective application of the recommended by the Code to determine the remuneration for Directors practice so as to attract, retain, motivate and incentivise Directors of the necessary calibre to lead the YTL Corp Group successfully. In general, the remuneration of the Directors is reviewed against the performance of the individual and the YTL Corp Group.

The Executive Directors’ remuneration consists of basic salary, other emoluments and other customary benefits as appropriate to a senior management member. The component parts of remuneration are structured so as to link rewards to performance. Directors do not participate in decisions regarding their own remuneration packages and Directors’ fees must be approved by shareholders at the AGM.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

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Intended Outcome The level and composition of remuneration of directors and senior management take into account the company’s desire to attract and retain the right talent in the board and senior management to drive the company’s long-term objectives.

Remuneration policies and decisions are made through a transparent and independent process.

Practice 6.2 The board has a Remuneration Committee to implement its policies and procedures on remuneration including reviewing and recommending matters relating to the remuneration of board and senior management.

The Committee has written Terms of Reference which deals with its authority and duties and these Terms are disclosed on the company’s website.

Application : Applied

Explanation on : During the financial year under review, a Remuneration Committee was application of the established to implement the policies and procedures on remuneration practice of Directors and to make recommendations to the Board on matters relating to the remuneration of Directors. The Remuneration Committee will begin reporting on its activities in the next financial year ending 30 June 2021.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

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Intended Outcome Stakeholders are able to assess whether the remuneration of directors and senior management is commensurate with their individual performance, taking into consideration the company’s performance.

Practice 7.1 There is detailed disclosure on named basis for the remuneration of individual directors. The remuneration breakdown of individual directors includes fees, salary, bonus, benefits in-kind and other emoluments.

Application : Applied

Explanation on : Details of the individual Directors’ remuneration categorised into application of the appropriate components can be found in Note 7in the Notes to the practice Financial Statements in the Annual Report.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

23

Intended Outcome Stakeholders are able to assess whether the remuneration of directors and senior management is commensurate with their individual performance, taking into consideration the company’s performance.

Practice 7.2 The board discloses on a named basis the top five senior management’s remuneration component including salary, bonus, benefits in-kind and other emoluments in bands of RM50,000.

Application : Departure

Explanation on : application of the practice

Explanation for : As regards the remuneration of the YTL Corp Group’s senior departure management team, the Board is of the view that the disclosure of these details would not be in the best interests of YTL Corp Group due to confidentiality and the competitive nature of the industries in which the YTL Corp Group operates, as well as for business and personal security reasons.

As stated above.

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure : As stated above

Timeframe : Others Under review

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Intended Outcome Stakeholders are able to assess whether the remuneration of directors and senior management is commensurate with their individual performance, taking into consideration the company’s performance.

Practice 7.3 - Step Up Companies are encouraged to fully disclose the detailed remuneration of each member of senior management on a named basis.

Application : Not Adopted

Explanation on : adoption of the practice

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Intended Outcome There is an effective and independent Audit Committee.

The board is able to objectively review the Audit Committee’s findings and recommendations. The company’s financial statement is a reliable source of information.

Practice 8.1 The Chairman of the Audit Committee is not the Chairman of the board.

Application : Applied

Explanation on : The Audit Committee is chaired by Dato’ Cheong Keap Tai, who is an application of the Independent Non-Executive Director and who is not the Chairman of the practice Board.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

26

Intended Outcome There is an effective and independent Audit Committee.

The board is able to objectively review the Audit Committee’s findings and recommendations. The company’s financial statement is a reliable source of information.

Practice 8.2 The Audit Committee has a policy that requires a former key audit partner to observe a cooling- off period of at least two years before being appointed as a member of the Audit Committee.

Application : Applied

Explanation on : The Audit Committee has formal policies to assess the suitability, application of the objectivity and independence of the external auditors. These policies practice also include a requirement that a former key audit partner must observe a cooling-off period of two years before being appointed as a member of the Audit Committee. However, none of the Audit Committee members were formerly audit partners of YTL Corp’s external auditors.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

27

Intended Outcome There is an effective and independent Audit Committee.

The board is able to objectively review the Audit Committee’s findings and recommendations. The company’s financial statement is a reliable source of information.

Practice 8.3 The Audit Committee has policies and procedures to assess the suitability, objectivity and independence of the external auditor.

Application : Applied

Explanation on : The Audit Committee has established formal and professional application of the arrangements for maintaining an appropriate relationship with the practice Company’s external auditors, HLB Ler Lum PLT. The external auditors also attend each AGM in order to address clarifications sought pertaining to the audited financial statements by shareholders.

The Audit Committee has formal policies to assess the suitability, objectivity and independence of the external auditor.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

28

Intended Outcome There is an effective and independent Audit Committee.

The board is able to objectively review the Audit Committee’s findings and recommendations. The company’s financial statement is a reliable source of information.

Practice 8.4 - Step Up The Audit Committee should comprise solely of Independent Directors.

Application : Adopted

Explanation on : The Audit Committee comprises solely Independent Directors adoption of the practice

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Intended Outcome There is an effective and independent Audit Committee.

The board is able to objectively review the Audit Committee’s findings and recommendations. The company’s financial statement is a reliable source of information.

Practice 8.5 Collectively, the Audit Committee should possess a wide range of necessary skills to discharge its duties. All members should be financially literate and are able to understand matters under the purview of the Audit Committee including the financial reporting process.

All members of the Audit Committee should undertake continuous professional development to keep themselves abreast of relevant developments in accounting and auditing standards, practices and rules.

Application : Applied

Explanation on : The members of the Audit Committee possess a wide range of application of the necessary skills to discharge their duties, and are financially literate and practice able to understand matters under the purview of the Audit Committee including the financial reporting process.

The members of the Audit Committee also intend to continue to undertake professional development by attending training to keep themselves abreast of relevant developments in accounting and auditing standards, practices and rules.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

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Intended Outcome Companies make informed decisions about the level of risk they want to take and implement necessary controls to pursue their objectives.

The board is provided with reasonable assurance that adverse impact arising from a foreseeable future event or situation on the company’s objectives is mitigated and managed.

Practice 9.1 The board should establish an effective risk management and internal control framework.

Application : Applied

Explanation on : The Board has established an effective risk management and internal application of the control framework, further details of which are disclosed in the Statement practice on Risk Management and Internal Control in the Annual Report.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

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Intended Outcome Companies make informed decisions about the level of risk they want to take and implement necessary controls to pursue their objectives.

The board is provided with reasonable assurance that adverse impact arising from a foreseeable future event or situation on the company’s objectives is mitigated and managed.

Practice 9.2 The board should disclose the features of its risk management and internal control framework, and the adequacy and effectiveness of this framework.

Application : Applied

Explanation on : The principal features for the YTL Corp Group’s system of internal application of the control and risk management framework are disclosed in the Statement practice on Risk Management and Internal Control in the Annual Report.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

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Intended Outcome Companies make informed decisions about the level of risk they want to take and implement necessary controls to pursue their objectives.

The board is provided with reasonable assurance that adverse impact arising from a foreseeable future event or situation on the company’s objectives is mitigated and managed.

Practice 9.3 - Step Up The board establishes a Risk Management Committee, which comprises a majority of independent directors, to oversee the company’s risk management framework and policies.

Application : Adopted

Explanation on : The YTL Corp Group’s strong financial profile is the result of a system adoption of the of internal control and risk management designed to mitigate risks which practice arise in the course of business. This is exemplified by the YTL Corp Group’s strategy of acquiring regulated assets and financing acquisitions on a non-recourse basis. These include those of its subsidiary, YTL Power International Berhad, including wholly-owned subsidiaries, Wessex Water Limited (“Wessex Water”) and YTL PowerSeraya Pte Limited (“YTL PowerSeraya”), as well as its interests in ElectraNet Pty Ltd, P.T. Jawa Power and Attarat Power Company PSC. These assets share common characteristics of highly predictable operating costs and revenue streams, which in turn generate stable and predictable cash flows and profits, underpinned by an established regulatory environment in their respective markets of operation.

The Group’s major operating subsidiaries, namely Wessex Water and YTL PowerSeraya, are subject to stringent financial and operational controls imposed by their respective regulators and the terms of their regulatory licenses. Wessex Water is regulated by the UK Water Services Regulation Authority (known as Ofwat), a government body, whilst YTL PowerSeraya is regulated by the Energy Market Authority (EMA), a statutory board under the Minister of Trade and Industry of Singapore.

The Board assumes overall responsibility for the YTL Corp Group’s risk management framework. Identifying, evaluating and managing any significant risks faced by the YTL Corp Group is an ongoing process which is undertaken by the senior management at each level of operations and by the Audit Committee, which assesses and analyses these findings and reports to the Board. At the same time, YTLIA, in the performance of its internal audit function, will identify and evaluate any significant risks faced by the YTL Corp Group and report these findings to the Audit Committee.

During the financial year under review, the Board’s functions in the risk management framework were exercised primarily by the Managing Directors/Executive Directors through their participation in management meetings to ensure the adequacy and integrity of the system of internal control. Emphasis is placed on reviewing and updating the process for identifying and evaluating the significant risks affecting the business, and policies and procedures by which these risks are managed.

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Intended Outcome Companies have an effective governance, risk management and internal control framework and stakeholders are able to assess the effectiveness of such a framework.

Practice 10.1 The Audit Committee should ensure that the internal audit function is effective and able to function independently.

Application : Applied

Explanation on : The YTL Corp Group's internal audit function is carried out by its Internal application of the Audit department (“YTLIA”), which provides assurance on the efficiency practice and effectiveness of the internal control systems implemented by Management, and reports directly to the Audit Committee. A description of the work of the internal audit function can be found in the Audit Committee Report set out in the Annual Report. This information is also available under the “Governance” section on the Company’s website at www.ytl.com.

YTLIA operates independently of the work it audits and provides periodic reports to the Audit Committee, reporting on the outcome of the audits conducted which highlight the effectiveness of the system of internal control and significant risks. The Audit Committee reviews and evaluates the key concerns and issues raised by YTLIA and ensures that appropriate and prompt remedial action is taken by management.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

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Intended Outcome Companies have an effective governance, risk management and internal control framework and stakeholders are able to assess the effectiveness of such a framework.

Practice 10.2 The board should disclose– ▪ whether internal audit personnel are free from any relationships or conflicts of interest, which could impair their objectivity and independence; ▪ the number of resources in the internal audit department; ▪ name and qualification of the person responsible for internal audit; and ▪ whether the internal audit function is carried out in accordance with a recognised framework.

Application : Applied

Explanation on : YTL Corp’s internal audit function is undertaken by YTLIA, which reports application of the directly to the Audit Committee. The Head of YTLIA, Mr Choong Hon practice Chow, is a member of the Malaysian Institute of Accountants and a fellow member of the Association of Chartered Certified Accountants (ACCA) UK. He started his career with the external audit division of a large public accounting firm before moving on to the internal audit profession in public listed companies and gained valuable and extensive internal audit experiences covering many areas of diversified commercial businesses and activities. He has a total of 37 years of internal and external audit experience.

YTLIA comprises 9 full-time personnel. The personnel of YTLIA are free from any relationships or conflicts of interest which could impair their objectivity and independence.

The internal audit function adopts the framework based on the International Standards for the Professional Practice of Internal Auditing issued by the Institute of Internal Auditors.

The activities of the internal audit function during the year under review included:-

▪ Developing the annual internal audit plan and proposing this plan to the Board; ▪ Conducting scheduled internal audit engagements, focusing primarily on the effectiveness of internal controls and recommending improvements where necessary; ▪ Conducting follow-up reviews to assess if appropriate action has been taken to address issues highlighted in audit reports; and ▪ Presenting audit findings to the Board for consideration.

Further details of the YTL Corp Group’s internal audit function are contained in the Statement on Risk Management & Internal Control and the Audit Committee Report as set out in the Annual Report.

Explanation for : departure

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Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

36

Intended Outcome There is continuous communication between the company and stakeholders to facilitate mutual understanding of each other’s objectives and expectations.

Stakeholders are able to make informed decisions with respect to the business of the company, its policies on governance, the environment and social responsibility.

Practice 11.1 The board ensures there is effective, transparent and regular communication with its stakeholders.

Application : Applied

Explanation on : The YTL Corp Group values dialogue with investors and constantly application of the strives to improve transparency by maintaining channels of practice communication with shareholders and investors that enable the Board to convey information about performance, corporate strategy and other matters affecting stakeholders’ interests. The Board believes that a constructive and effective investor relationship is essential in enhancing shareholder value and recognises the importance of timely dissemination of information to shareholders.

Accordingly, the Board ensures that shareholders are kept well-informed of any major development of the YTL Corp Group. Such information is communicated through the Annual Report, the various disclosures and announcements to Bursa Securities, including quarterly and annual results, and corporate websites. Corporate information, annual financial results, governance information, business reviews and future plans are disseminated through the Annual Report, whilst current corporate developments are communicated via the Company’s corporate website at www.ytl.com and the YTL Corp Group’s community website at www.ytlcommunity.com, in addition to prescribed information, including its interim financial results, announcements, circulars, prospectuses and notices, which is released through the official website of Bursa Securities.

The Executive Chairman, Managing Director and the Executive Directors meet with analysts, institutional shareholders and investors throughout the year not only to promote the dissemination of the YTL Corp Group’s financial results but to provide updates on strategies and new developments to ensure better understanding of the YTL Corp Group’s operations and activities. Presentations based on permissible disclosures are made to explain the YTL Corp Group’s performance and major development programs.

Whilst efforts are made to provide as much information as possible to its shareholders and stakeholders, the Directors are cognisant of the legal and regulatory framework governing the release of material and sensitive information so as to not mislead its shareholders. Therefore, the information that is price-sensitive or that may be regarded as undisclosed material information about the YTL Corp Group is not disclosed to any party until after the prescribed announcement to Bursa Securities has been made.

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Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

38

Intended Outcome There is continuous communication between the company and stakeholders to facilitate mutual understanding of each other’s objectives and expectations.

Stakeholders are able to make informed decisions with respect to the business of the company, its policies on governance, the environment and social responsibility.

Practice 11.2 Large companies are encouraged to adopt integrated reporting based on a globally recognised framework.

Application : Departure

Explanation on : application of the practice

Explanation for : It is the view of the Company that the current format of the Annual Report departure provides shareholders with the necessary information on the business of the Company and the Group, and policies on governance, risk management and internal control and sustainability in a comprehensive and understandable manner.

However, the Company reviews the contents and format of its annual reports on an ongoing basis to improve and enhance its disclosure to shareholders.

As stated above

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure : As stated above

Timeframe : Others Ongoing

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Intended Outcome Shareholders are able to participate, engage the board and senior management effectively and make informed voting decisions at General Meetings.

Practice 12.1 Notice for an Annual General Meeting should be given to the shareholders at least 28 days prior to the meeting.

Application : Applied

Explanation on : The Notice of AGM is sent to shareholders at least 28 days prior to the application of the AGM in accordance with the Code, which also meets the criteria of the practice Listing Requirements and Companies Act 2016, which require the Notice of AGM to be sent 21 days prior to the AGM.

The Notice for the forthcoming 37th AGM of the Company to be held on 1 December 2020 has been sent on 30 October 2020.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

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Intended Outcome Shareholders are able to participate, engage the board and senior management effectively and make informed voting decisions at General Meetings.

Practice 12.2 All directors attend General Meetings. The Chair of the Audit, Nominating, Risk Management and other committees provide meaningful response to questions addressed to them.

Application : Applied

Explanation on : The Directors are mindful of the recommendation under the Code that all application of the directors must attend general meetings and fully appreciate the need for practice their attendance at all such meetings.

The Executive Chairman, Managing Director and Executive Directors take the opportunity to present a comprehensive review of the progress and performance of the YTL Corp Group and provide appropriate answers in response to shareholders’ questions during the meeting, thereby ensuring a high level of accountability, transparency and identification with the YTL Corp Group’s business operations, strategy and goals.

The Independent Directors who chair the Audit and Nominating committees provide meaningful responses to any questions addressed to them.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

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Intended Outcome Shareholders are able to participate, engage the board and senior management effectively and make informed voting decisions at General Meetings.

Practice 12.3 Listed companies with a large number of shareholders or which have meetings in remote locations should leverage technology to facilitate– ▪ including voting in absentia; and ▪ remote shareholders’ participation at General Meetings.

Application : Applied

Explanation on : In view of the ongoing COVID-19 pandemic, the forthcoming 37th AGM application of the will be held on a fully virtual basis, the details of which can be found in practice the Notice of Annual General Meeting in the Annual Report.

Explanation for : departure

Large companies are required to complete the columns below. Non-large companies are encouraged to complete the columns below. Measure :

Timeframe :

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SECTION B – DISCLOSURES ON CORPORATE GOVERNANCE PRACTICES PERSUANT CORPORATE GOVERNANCE GUIDELINES ISSUED BY BANK NEGARA MALAYSIA

Disclosures in this section are pursuant to Appendix 4 (Corporate Governance Disclosures) of the Corporate Governance Guidelines issued by Bank Negara Malaysia. This section is only applicable for financial institutions or any other institutions that are listed on the Exchange that are required to comply with the above Guidelines.

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