ANNUAL REPORT 2009
Above and beyond At UMLand, we are focused on creating the perfect setting for living. Through our core business of building integrated townships and niche developments, we will continue to deliver long-term value to our customers and shareholders. By growing hand-in-hand with the community and enriching lives, we strive to excel above and beyond.
2 UNITED MALAYAN LAND BHD (4131-M)
Corporate Profi le 4 Corporate Information 7 Chairman’s Message 10
Five-Year Group Financial Highlights 14 Financial Calendar 16 Group Corporate Structure 17
Board of Directors 18 Profi le of Directors 20 Management Team 30 Operations Review 36
Corporate Responsibility 44 Corporate Calendar 46 Corporate Governance Statement 53
Statement on Internal Control 61 Audit Committee Report 64 Additional Compliance Information 67
Financial Statements 75 List of Properties 142 Analysis of Shareholdings 145
Notice of 49th Annual General Meeting 148
Statement Accompanying Notice of 49th Annual General Meeting 152 Form of Proxy contents UNITED MALAYAN LAND BHD (4131-M) 3
Vision To be a property developer of distinction, creating quality lifestyles and communities
Mission To develop a brand that represents quality and innovation which creates value and is the preferred choice Shared Values Integrity
Customer driven
Profi table
Excellence
Rewarding
Team that works
Progressive 4 UNITED MALAYAN LAND BHD (4131-M)
Corporate Profi le UNITED MALAYAN LAND BHD (4131-M) 5
United Malayan Land Bhd. (UMLand) was incorporated in 1961 and listed on the Main Board of Bursa Malaysia Securities Berhad in 1969. The Group is principally involved in property development.
Guided by a dynamic Board of Directors under the leadership of YABhg Tun Musa Hitam, UMLand’s Board of Director comprises nine members and an alternate, four of whom are independent.
With a proven track record as a property developer of distinction in both mixed-development townships and high-end niche developments, the Group’s growth strategy is to build on its solid foundation by enhancing the value of its Township Division and expanding its Niche Division.
The Group’s Township Division has three township developments with a total land area of more than 5,000 acres, located in Iskandar Malaysia, Johor (Bandar Seri Alam and Taman Seri Austin) and Selangor (Bandar Seri Putra), all of which are high growth development areas.
In the Niche Division, the Group has completed and delivered 846 units of condominium and serviced residences, in the Golden Triangle in downtown Kuala Lumpur (Seri Bukit Ceylon) and at Kuala Lumpur Sentral (Suasana Sentral Loft), and is currently developing Suasana Bangsar, a 190-unit condominium located in the upmarket suburb of Bangsar. Besides Suasana Bangsar, the Group has several new projects in hand, located within the vicinity of KLCC, Kuala Lumpur Golden Triangle and Iskandar Malaysia.
As at December 31, 2009, UMLand’s paid up share capital is RM241,705,233, comprising 241,705,233 ordinary shares of RM1.00 each. The Group’s shareholders’ fund is RM857.85 million and its net assets per ordinary share is RM3.56. 6 UNITED MALAYAN LAND BHD (4131-M) UNITED MALAYAN LAND BHD (4131-M) 7 Corporate Information
BOARD OF DIRECTORS REMUNERATION COMMITTEE COMPANY SECRETARY Tun Musa Hitam Datuk Syed Ahmad Khalid Zuraidah Mohd Yusoff Chairman bin Syed Mohammed (Chairman) (MAICSA 7001552) Independent Non-Executive Director Datuk Nur Jazlan bin Tan Sri Mohamed Syed Azmin bin Mohd Nursin REGISTERED OFFICE Dato’ Ng Eng Tee @ Syed Nor Deputy Chairman / Executive Director Suite 1.1, 1st Floor Non-Independent Executive Director Kompleks Antarabangsa NOMINATION COMMITTEE Jalan Sultan Ismail Chan Say Yeong Datuk Syed Ahmad Khalid 50250 Kuala Lumpur Non-Independent Non-Executive Director bin Syed Mohammed (Chairman) Tel No : 603-2142 1611 Datuk Nur Jazlan bin Tan Sri Mohamed Fax No : 603-2142 1826 (Corporate) Datuk Syed Ahmad Khalid Syed Azmin bin Mohd Nursin 603-2141 4867 (Secretarial) bin Syed Mohammed @ Syed Nor Independent Non-Executive Director AUDITORS Datuk Nur Jazlan bin Tan Sri Mohamed RISK COMMITTEE PricewaterhouseCoopers Independent Non-Executive Director Syed Azmin bin Mohd Nursin Chartered Accountants @ Syed Nor (Chairman) Level 10, 1 Sentral, Jalan Travers Hazel Chew Siew Cheng Dato’ Ng Eng Tee Kuala Lumpur Sentral Non-Independent Non-Executive Director Pakhruddin bin Sulaiman P O Box 10192 50706 Kuala Lumpur Syed Azmin bin Mohd Nursin OPTION COMMITTEE @ Syed Nor PRINCIPAL BANKERS Non-Independent Non-Executive Director Syed Azmin bin Mohd Nursin @ Syed Nor OCBC Bank (Malaysia) Berhad Ng Eng Soon Dato’ Ng Eng Tee Alliance Bank Malaysia Berhad Non-Independent Non-Executive Director Pee Tong Lim Malayan Banking Berhad CIMB Bank Berhad Pakhruddin bin Sulaiman Kuwait Finance House (Malaysia) Berhad SENIOR MANAGEMENT Independent Non-Executive Director AmBank Berhad Dato’ Ng Eng Tee Deputy Chairman / Executive Director Lim Wie Shan SHARE REGISTRAR (alternate to Chan Say Yeong and Hazel Chew Siew Cheng) Pee Tong Lim Securities Services (Holdings) Sdn. Bhd. Non-Independent Non-Executive Director Group Chief Executive Offi cer Level 7, Menara Milenium Jalan Damanlela Zulkifl y Garib Pusat Bandar Damansara AUDIT COMMITTEE Director, Operations Damansara Heights Datuk Syed Ahmad Khalid 50490 Kuala Lumpur bin Syed Mohammed (Chairman) Tel No : 603-2084 9000 TOWNSHIP MANAGEMENT Datuk Nur Jazlan bin Tan Sri Mohamed Fax No : 603-2094 9940 Chan Say Yeong Ng Tay Guan Pakhruddin bin Sulaiman General Manager, Bangi Heights Development Sdn. Bhd. STOCK EXCHANGE LISTING Main Market EXECUTIVE COMMITTEE Mohd Noor Abdul Salam Bursa Malaysia Securities Berhad Tun Musa Hitam (Chairman) General Manager, Stock Name : UMLAND Dato’ Ng Eng Tee Seri Alam Properties Sdn. Bhd. Stock Code : 4561 Syed Azmin bin Mohd Nursin Wong Kuen Kong @ Syed Nor WEBSITE ADDRESS Chan Say Yeong General Manager, Dynasty View Sdn. Bhd. www.umland.com.my
TENDER BOARD COMMITTEE Dato’ Ng Eng Tee (Chairman) Syed Azmin bin Mohd Nursin @ Syed Nor Chan Say Yeong 8 UNITED MALAYAN LAND BHD (4131-M) trust
Trust is a pride we have earned from our customers as we continuously deliver our projects on time and with superior quality. Trust of our investors and stakeholders comes from the stringent adherence to corporate governance and rules of transparency which we consistently practise with the highest ethical standards as a responsible corporate citizen. UNITED MALAYAN LAND BHD (4131-M) 9 10 UNITED MALAYAN LAND BHD (4131-M) UNITED MALAYAN LAND BHD (4131-M) 11 Chairman’s Message
The Group posted a robust net profi t of RM55.0 million on the back of revenue that rose 21% to RM208.5 million contributed by both its Township and Niche Divisions, including several strategic land sales.
PREAMBLE It was not until the second-half of 2009 It is with pleasure that I present to you the that sales of residential properties began annual report of the Group for the fi nancial to recover as demand in the property year ended 31 December 2009 (FY09). market picked up from a boost in consumer confi dence largely due to a low interest rate The year under review continued to be regime and government measures to support challenging as the global fi nancial crisis in the economy. late 2008 continued into 2009.
2009: SAILING THROUGH STORMY While the Malaysian economy did not enter WATERS into a recession until late 2008, the impact of The fi rst quarter of 2009 was almost certainly the slowdown was felt for the better part of the worst part of a challenging year for all the fi rst-half of 2009. concerned with Malaysia’s export-driven economy feeling the impact of a spiraling For property developers, this meant a drop in global demand. marked drop in demand for housing and this was refl ected in lower sales for the Group, This had a knock-on effect on the rest of the particularly in the fi rst half of the year. economy as consumer spending fell due to the general slump in confi dence. 12 UNITED MALAYAN LAND BHD (4131-M)
Chairman’s Message
As a result of the economic recession, the Group scaled back on TRANSFORMATION property launches for the year. The economic recession and the slowdown in property launches was an opportunity for the Group to revise the master plans of the However, the economy began the slow but steady climb towards townships it is currently developing, to further improve effi ciency in recovery beginning in the second-half of the year and this was land usage and enhance the value of its landbanks. refl ected in the forward economic indicators such as factory output and subsequently by exports, which saw demand pick up again initially In 2009, certain strategic land sales in Bandar Seri Alam were identifi ed due to stocking activities and then by a more steady real demand. and sold to several institutions of higher learning in Bandar Seri Alam. These include Mara Junior Science College, Universiti Kuala Lumpur, The low interest rate regime maintained by Bank Negara, which Universiti Teknologi Mara, Masterskill University College of Health kept its benchmark policy rate – the overnight policy rate (OPR) – at Sciences and an Arts College. 2% following rate cuts in January and February last year helped in supporting consumer demand, especially for big ticket items such as The Iskandar Malaysia Eastern District police headquarters was also housing and passenger cars. set up in Bandar Seri Alam, which will boost security in the township. Currently, the police headquarters is located in a rented building but Additionally, the RM67 billion worth of stimulus measures announced will eventually relocate to a new building, which is currently under by the government in November 2008 and March 2009, helped in construction. supporting the economic recovery, which expanded in the fourth quarter of 2009 after three consecutive quarters of contraction. The educational institutions are expected to commence operations in late 2011 and early 2012, and this together with the added security FINANCIAL PERFORMANCE of having a district police headquarters is expected to have a positive impact on the township’s continued development. In the year under review, the Group posted a net profi t of RM55.0 million compared to a loss of RM3.5 million in the fi nancial year ended As Bandar Seri Alam matures further and with its changing 31 December 2008, on revenue that rose 21% to RM208.5 million. demographic profi le, the Group has taken the strategic move to incorporate changes to the master plan in order to cater to the lifestyle The strong rebound in net profi t was largely due to several strategic of its population including the young and dynamic segment. land sales that the Group conducted in the township of Bandar Seri Alam in Johor, as well as increased profi t contribution from the The Group considers the various initiatives taken by Bandar Seri Alam township of Bandar Seri Putra in Selangor; and Suasana Bangsar, a as a platform to move forward and capitalize on the future upturn high-end condominium project in Kuala Lumpur. in the property market in the region. In this respect, land sales and strategic tie-ups will continue although the contribution of such sales Earnings per share climbed to 22.7 sen against the -1.4 sen recorded to net profi t and revenue will not be as signifi cant going forward. in the previous year.
The establishment of the various institutions of higher learning DIVIDEND has transformed Bandar Seri Alam into a “City of Knowledge” The Group has paid out two interim dividends of 2.5 sen gross per (an education hub) for the eastern part of the Iskandar Malaysia share, less tax, each for FY09. development corridor. This augurs well for Seri Alam’s future development with a balance of approximately 1,200 acres yet to be A fi nal dividend of 4.76 sen per share, consisting of gross dividend of developed. 4.06 sen per share, less tax, and tax exempt dividend of 0.70 sen per share, has been proposed by the directors which will be subjected to shareholders’ approval in the forthcoming annual general meeting.
If approved, this together with the two interim dividends will bring the total gross dividend to 9.76 sen per share. UNITED MALAYAN LAND BHD (4131-M) 13
Two interim dividends and a proposed fi nal dividend totaling 9.76 sen per share for FY09 is in line with the Group’s consistent efforts to deliver strong shareholders returns.
OUTLOOK IN 2010 ACKNOWLEDGMENTS The industry outlook for 2010 is expected to be an improvement over The year under review has been challenging, to say the least. 2009 as the economy recovers and demand picks up. However, the However, the Group has weathered the challenges with the support main concern will be the expected rise in interest rates for housing of a dedicated and professional board of directors as well as the hard loans, which may have a dampening impact on the property market work of the employees. despite the anticipated growth in demand. During the year we saw a change in the leadership of the Group with This is premised on the fact that Bank Negara, which raised the Mr Anthony Yap stepping down as the Group Chief Executive Offi cer overnight policy rate by 25 basis points in March this year to 2.25%, (GCEO) after the expiration of his contract on 15 September 2009. and then to 2.5% in May, may raise the benchmark policy rate I would like to extend my appreciation to Anthony for his contributions further. to the Group during his tenure. At the same time, I would like to congratulate Mr Pee Tong Lim, who was the Group’s former Director The anticipated growth in demand augurs well for the Group’s of Corporate and Finance, as our new GCEO. I am confi dent that the township division. In the year ahead, the Group will continue to launch Group will forge further ahead under his capable stewardship. new products in its three townships, namely Bandar Seri Alam, Taman Seri Austin and Bandar Seri Putra, which will continue to provide the My heartfelt appreciation also goes out to the management and staff base contribution to revenue. who have worked hard to ensure that the Group sailed through the diffi cult period with little adverse impact. For its niche division, Suasana Bangsar project is expected to be completed in 2010. Going forward, the Group has several new niche Last but not least, my appreciation also goes out to all our valued projects in the pipeline. The fi rst is Suasana Bukit Ceylon, a high- customers, bankers, business associates and the various local end condominium project along Jalan Raja Chulan in the heart of authorities for their continued confi dence and support. Kuala Lumpur, which is targeted to be launched in the second half of 2010.
Besides Suasana Bangsar and Suasana Bukit Ceylon, the other new niche projects include a service apartment project in Puteri Harbour in a waterfront precinct that is part of Nusajaya in Iskandar Malaysia (a 50:50 joint venture with UEM Land Bhd); Matex project in Jalan Wong Ah Fook Johor Bahru; Ipjora project in Bukit Ceylon area in Kuala Lumpur; and the Mayang project in the vicinity of KLCC (a 50:50 joint venture with Bolton). Tun Musa Hitam In my statement last year, I informed you about the proposed joint Chairman venture development with Tradewinds Johor Sdn Bhd in Pulai. This proposed joint venture has been approved by the shareholders in an Extraordinary General Meeting held on 1 October 2009. The acquisition of the 600-acre land in Pulai Jaya by the joint venture company is pending completion. This land proposed to be developed into an industrial hub is strategically located near Senai Airport with good linkage to Bandar Nusajaya. 14 UNITED MALAYAN LAND BHD (4131-M) Five-Year Group Financial Highlights
UMLand Group 2009 2008 2007 2006 2005 (fi gures in RM million unless otherwise stated)
OPERATING RESULTS Revenue 208.51 172.08 396.77 416.58 214.80
Profi t before taxation 62.92 0.58 71.05 67.46 36.86 Taxation (5.45) (1.84) (11.10) (10.89) (3.13)
Net profi t/(loss) for the fi nancial year 57.47 (1.26) 59.95 56.57 33.73
Attributable to: Equity holders of the Company 55.04 (3.46) 46.61 40.15 29.21 Minority interests 2.43 2.20 13.34 16.42 4.52
KEY BALANCE SHEET DATA Property, plant and equipment 280.39 328.91 339.43 344.29 344.39 Long term investments 77.36 40.17 35.18 4.72 4.76 Land held fo property development 194.70 172.97 163.97 174.29 178.45 Other non-current assets 18.51 16.52 14.12 17.25 21.86 Current assets 626.18 712.87 728.13 812.61 642.37
Total assets 1,197.14 1,271.44 1,280.83 1,353.16 1,191.83
Current liabilities 179.74 211.49 199.18 360.90 240.57 Non-current borrowings 81.76 134.67 149.87 116.11 112.67 Other non-current liabilities 10.87 24.83 12.08 29.11 32.79
Total liabilities 272.37 370.99 361.13 506.12 386.03
Total net assets 924.77 900.45 919.70 847.04 805.80
Minority interests (66.92) (84.06) (86.87) (74.65) (59.40) Shareholders’ equity 857.85 816.39 832.83 772.39 746.40
FINANCIAL RATIOS Gross dividend per share (sen) - Taxed 9.06 2.5 10.0 6.5 7.5 - Tax exempt 0.70 – – 2.5 –
Basic earnings per share (sen) 22.8* (1.4) 19.6 17.3 12.6
Net assets per share (RM) 3.56** 3.38 3.45 3.33 3.22
Gearing (times) 0.22 0.34 0.30 0.45 0.35
* Basic earnings per share is calculated based on the weighted average number of shares of 241,303,433 in issue during the year.
** Net assets per share (attributable to equity holders of the Company) is calculated based on the reduced number of shares of 241,303,433 in issue (which is net of 401,800 treasury shares). UNITED MALAYAN LAND BHD (4131-M) 15
Revenue Net profit attributable to equity holders of the Company 208.51 mil +21% 55.04 mil +>100% Boost in sales of Suasana Bangsar Robust contribution and strategic land sales from our Niche Division
09 208.51 09 55.04
08 172.08 08 (3.46)
07 396.77 07 46.61
06 416.58 06 40.15
05 214.80 05 29.21
Basic earnings per share Total assets
22.8 sen +>100% 1,197.14 mil -6% Strong rebound in earnings Continually enhancing the value of our assets
09 22.8 09 1,197.14
08 (1.4) 08 1,271.44
07 19.6 07 1,280.83
06 17.3 06 1353.16
05 12.6 05 1,191.83
Net assets per share Gross dividend per share
3.56 ringgit +5% 9.76 sen +>100% Demonstrating concerted efforts Recognising continued support in maintaining value of our Company of our shareholders
09 3.56 09 9.76
08 3.38 08 2.5
07 3.45 07 10.0
06 3.33 06 9.0
05 3.22 05 7.5 16 UNITED MALAYAN LAND BHD (4131-M)
Financial Calendar FOR THE PERIOD 1 JANUARY 2009 TO 31 DECEMBER 2009
25 February 26 August
Announcement of Announcement of Quarter 4 fi nancial results Quarter 2 fi nancial results for the fi nancial period for the fi nancial period ended 31 December 2008 ended 30 June 2009 to Bursa Malaysia to Bursa Malaysia Securities Berhad. Securities Berhad.
21 May 18 September
Announcement of Payment of a fi nal dividend Quarter 1 fi nancial results of 2.5 sen per ordinary share for the fi nancial period less tax, in respect of the ended 31 March 2009 fi nancial year ended to Bursa Malaysia 31 December 2008. Securities Berhad. The fi nal net dividend amounted to RM4,524,438.65.
22 June 1 October
Payment of an interim Extraordinary General dividend of 2.5 sen per Meeting at Crowne Plaza ordinary share less tax, Mutiara Kuala Lumpur. in respect of the fi nancial year ended 31 December 2009. The fi nal net dividend amounted to RM4,524,438.61. 24 June 23 November
48th Annual General Announcement of Meeting at Crowne Plaza Quarter 3 fi nancial results Mutiara Kuala Lumpur. for the fi nancial period ending 30 September 2009 to Bursa Malaysia Securities Berhad. UNITED MALAYAN LAND BHD (4131-M) 17
Group Corporate Structure
Investment holding and provision of management services
Seri Alam Hotel Resort Sdn Bhd 100% General Trading Township Seri Alam Properties Sdn Bhd PMS Services Sdn Bhd 100% 100% Property Development and Related Activities Project Management
Dynasty View Sdn Bhd Seri Alam Leisure Sdn Bhd 100% 100% Property Development and Related Activities Investment Holding
Bangi Heights Development Sdn Bhd Seri Alam Golf & Equestrian Club Sdn Bhd 70% 100% Property Development and Related Activities Operation of a Recreational Club and Related Activities
Niche UM Development Sdn Bhd 100% Property Development and Related Activities
Exquisite Mode Sdn Bhd 100% Property Development and Related Activities
UM Land Assets Sdn Bhd Ipjora Holdings Sdn Bhd 100% Property Investment 100% Developing, Building, owning and operating Serviced Apartments
Exquisite Skyline Sdn Bhd 71% Property Development and Related Activities
Extreme Consolidated Sdn Bhd 51% Property Development and Related Activities
Alpine Return Sdn Bhd 50% Property Development and Related Activities
Nusajaya Consolidated Sdn Bhd 50% Property Development and Related Activities
Suasana Sentral Two Sdn Bhd 70% Property Development and Related Activities
SSBC Sdn Bhd UM Residences Sdn Bhd 100% Letting and Marketing Somerset Seri Development of Serviced Apartments 50.533% Bukit Ceylon Serviced Residences
UM Land Bena Sdn Bhd 100% Property Development and Related Activities
Country Equity Sdn Bhd 100% Investment Holding
UM Leisure Sdn Bhd 100% General Trading
Clear Dynamic Sdn Bhd 100% Property Development and Related Activities 18 UNITED MALAYAN LAND BHD (4131-M) Board of Directors
Tun Musa Hitam Dato’ Ng Eng Tee Chan Say Yeong
Datuk Nur Jazlan Datuk Syed Ahmad Khalid Syed Azmin Bin Mohd Nursin Bin Tan Sri Mohamed Bin Syed Mohammed @ Syed Nor UNITED MALAYAN LAND BHD (4131-M) 19
Pakhruddin Bin Sulaiman Ng Eng Soon Hazel Chew Siew Cheng
Lim Wie Shan (not in picture) 20 UNITED MALAYAN LAND BHD (4131-M) Profi le of
Tun Musa Hitam was appointed to the Board of UMLand on 26 January 2006. He is also the Chairman of the Executive Committee Directors of UMLand. Before becoming Malaysia’s fi fth Deputy Prime Minister and Minister of Home Affairs from 1981 to 1986, Tun Musa Hitam held a number of key government posts, including Chairman of Federal Land Development Authority (FELDA), Deputy Minister of Trade & Industry, Minister of Primary Industries and Minister of Education. Between 1990 and 1991, he was Malaysia’s Special Envoy to the United Nations and from 1995 to 2002 the Prime Minister’s Special Envoy to the Commonwealth Ministerial Action Group. He was leader of the Malaysia delegation to the UN Commission on Human Rights from 1993 to 1998 and Chairman of the 52nd Session of the Commission in 1995.
Tun Musa Hitam received his Bachelor of Arts Degree from the University of Malaya and Masters Degree in International Relations from the University of Sussex, United Kingdom. He also holds Honorary Doctorates from the University of Sussex, University Malaysia Sabah, University of Malaya and University Technology MARA. He was a Fellow at the Centre for International Affairs, Harvard University, United States of America and is currently a Fellow of the Malaysian Institute of Management and a member of the Advisory Board of the Malaysian Journal of Diplomacy and Foreign Relations.
He is currently the Chairman of Sime Darby Berhad and Lion Industries Corporation Berhad.
He is also a member of the Advisory Panel of the South Johor Economic Region, a Joint-Chairman of the Malaysia-China Business Council, Chairman of the World Islamic Economic Forum, Chairman of the Eminent Persons Group on the ASEAN Charter and Special Envoy of the Commonwealth Secretary-General to the Maldives.
Tun Musa Hitam does not have any family relationship with any director or major shareholder of UMLand. He has never been charged for any offence and there has been no business arrangements with UMLand in which he has personal interests.
Tun Musa Hitam Chairman Independent Non-Executive Director Age : 76 Nationality : Malaysian UNITED MALAYAN LAND BHD (4131-M) 21
Dato’ Ng Eng Tee joined the Board of UMLand on 31 October 1995 and assumed the position of Joint Deputy Chairman/ Executive Director on 28 August 2002. On 31 October 2008, he was redesignated as the Deputy Chairman/Executive Director of UMLand. He is a member of the Executive Committee, Tender Board Committee, Risk Committee and Option Committee of UMLand.
He graduated from the Singapore Polytechnic. He is also the Managing Director of Chee Tat Holdings (S) Pte Ltd. In addition, he is the President of King George Financial Corporation, listed on the Canadian Stock Exchange. He is also a founding life member of the Presidents Club of Simon Fraser University.
Dato’ Ng Eng Tee is a brother to Ng Eng Soon, a director of UMLand. He is also a nominee of Chee Tat Holdings (S) Pte Ltd, a major shareholder of UMLand. Hence, he is deemed to be interested in certain recurrent related party transactions of a revenue and trading nature which are necessary for the day-to- day operations of which UMLand and its subsidiaries may enter with Chee Tat Holdings (S) Pte Ltd. He has never been charged for any offence and there has been no business arrangements with UMLand in which he has personal interests.
Dato’ Ng Eng Tee Deputy Chairman / Executive Director Non-Independent Executive Director Age : 60 Nationality : Singaporean / Malaysian PR 22 UNITED MALAYAN LAND BHD (4131-M)
Profi le of Directors
Chan Say Yeong was appointed to the Board of UMLand on 1 August 2008. He is also a member of the Audit Committee, Executive Committee and Tender Board Committee of UMLand.
He is currently the Chief Executive Offi cer and Executive Director of Quill Capita Management Sdn Bhd. Prior to this, he was the Managing Director of CapitaLand Financial Limited based in Malaysia.
Chan Say Yeong holds a Bachelor of Accounting from the National University of Singapore. He completed the Executive Development Program in Wharton School of the University of Pennsylvania, United States of America.
He does not have any family relationship with any director or major shareholder of UMLand except by virtue of being a nominee of CapitaLand, a major shareholder of UMLand. Hence, he is deemed to be interested in certain recurrent related party transactions of a revenue and trading nature which are necessary for the day-to-day operations of which UMLand and its subsidiaries may enter with the CapitaLand Group. He has never been charged for any offence and there has been no business arrangements with UMLand in which he has personal interests.
Chan Say Yeong Non-Independent Non-Executive Director Age : 46 Nationality : Malaysian UNITED MALAYAN LAND BHD (4131-M) 23
Datuk Syed Ahmad Khalid bin Syed Mohammed was appointed to the Board of UMLand on 19 October 1994. He is currently the Chairman of the Audit Committee and a member of the Nomination Committee and Remuneration Committee of UMLand.
An Asia Foundation scholar, Datuk Syed Ahmad Khalid received his Masters of Arts (M.A.) Degree majoring in Economics and International Trade and Finance from Ohio University, United States of America in 1973.
Earlier in his career, he lectured Economics at University Technology MARA (UiTM)’s School of Business and Management. In 1976, he left UiTM to join Pernas Securities as its Economist and began a successful career in the private sector. Between 1978-1988 Datuk Syed Ahmad Khalid worked both in London and New York. He was MMC’s Head representative at Phillip Brothers Inc. Group of Companies both in London and New York. He returned to Malaysia in late 1980’s and worked in various senior management positions in several private and public companies amongst them being the Chairman of Century Logistics Holdings Berhad (a company which he co-founded and was its substantial shareholder), Group Executive Director of Granite Industries Berhad and Executive Chairman of Berisford (M) Sdn Bhd. The latter is an international commodities trading company which Datuk Syed Ahmad Khalid established with Berisford Plc of United Kingdom.
Currently, in addition to being a Director of UMLand, Datuk Syed Ahmad Khalid is a director and shareholder of several private companies.
He does not have any family relationship with any director or major shareholder of UMLand. He has never been charged for any offence and there has been no business arrangements with UMLand in which he has personal interests.
Datuk Syed Ahmad Khalid Bin Syed Mohammed Independent Non-Executive Director Age : 60 Nationality : Malaysian 24 UNITED MALAYAN LAND BHD (4131-M)
Profi le of Directors
Datuk Nur Jazlan bin Tan Sri Mohamed was appointed to the Board of UMLand on 19 October 1994. He is also a member of the Audit Committee, Nomination Committee and Remuneration Committee of UMLand.
Datuk Nur Jazlan is a Fellow of the Association of Chartered Certifi ed Accountants (ACCA), United Kingdom. He is a Council Member and Chairman of Public Relations Committee of Malaysian Institute of Accountants as well as a Council Member of the Asean Federation of Accountants (AFA).
In addition to his corporate experience, Datuk Nur Jazlan is also active in politics. He is the Head of UMNO Pulai, Johor and also the Chairman of Barisan Nasional for the division. He was an EXCO Member of UMNO Youth from 1996 until 2004. He was re-elected as a Member of Parliament for Pulai Parliamentary Constituency (Johor) in the general election held in March 2008. He is also a member of the Public Accounts Committee (PAC) in the Parliament and the Chairman of the Finance Committee of the Barisan Nasional Backbenchers Club.
He currently sits on the Board of Telekom Malaysia Berhad (TM), Prinsiptek Corporation Berhad, Jaycorp Berhad, TSH Resources Berhad and Ekowood International Berhad.
Datuk Nur Jazlan was the Chairman of TM’s Board Audit Committee from 2004 – 2007 and a Member of Board Tender Committee. He was also a Member of Board of Commissioners of PT Excelcomindo Pratama, Indonesia until July 2008, and Chairman of Multinet Pakistan (Private) Limited, subsidiaries of TM until June 2008.
Datuk Nur Jazlan does not have any family relationship with any director or major shareholder of UMLand. He has never been charged for any offence and there has been no business arrangement with UMLand in which he has personal interests.
Datuk Nur Jazlan Bin Tan Sri Mohamed Independent Non-Executive Director Age : 44 Nationality : Malaysian UNITED MALAYAN LAND BHD (4131-M) 25
Hazel Chew Siew Cheng joined the Board of UMLand as Non-Independent Non-Executive Director on 31 October 2009.
Ms Chew graduated from the National University of Singapore with a Bachelor of Accountancy degree. She is also a graduate from the Institute of Chartered Secretaries and Administrators.
In 1998, she joined Pidemco Land Limited (now known as CapitaLand Limited). She is currently the Senior Vice President (Finance & Corporate Services) in CapitaLand Commercial Limited. She is a director of various companies in which CapitaLand has interests in, including MCDF Investment Pte Ltd which has investments in Malaysia. Prior to her current appointment, she was the Chief Financial Offi cer of The Ascott Group Limited and Vice President (Finance & Management Accounting) at CapitaLand Head Offi ce in-charge of overall group fi nancial reporting as well as group accounting policies and procedures.
Ms Chew does not have any family relationship with any director or major shareholder of UMLand except by virtue of being a nominee of CapitaLand, a major shareholder of UMLand. Hence, she is deemed to be interested in certain recurrent related party transactions of a revenue and trading nature which are necessary for the day-to-day operations of which UMLand and its subsidiaries may enter with the CapitaLand Group. She has never been charged for any offence and there has been no business arrangements with UMLand in which she has personal interests.
Hazel Chew Siew Cheng Non-Independent Non-Executive Director Age : 45 Nationality : Singaporean 26 UNITED MALAYAN LAND BHD (4131-M)
Profi le of Directors
Syed Azmin bin Mohd Nursin @ Syed Nor was appointed to the Board of UMLand on 3 May 2006. He is also a member of the Executive Committee, Tender Board Committee, Risk Committee, Nomination Committee, Remuneration Committee and Option Committee of UMLand.
He is currently the Executive Director of Amtek Holdings Berhad. He also sits on the Board of the Engtex Group Berhad, Tradewinds Corporation Berhad and Tradewinds (M) Berhad.
He was an Executive Director of CN Asia Corporation Berhad from 1997 to 2005 where he was responsible for the corporate affairs and business development. In 1999, he was one of the Founders / Director of an IT company, Commerce Dot Com Sdn Bhd which undertook one of the government’s electronic commerce project, e-Perolehan.
Syed Azmin graduated with a Bachelor of Science Degree, majoring in Business Management from University of Berkeley, United States of America. Upon his graduation in 1984, he was involved in several private business ventures which included trading in commodities, housing development, manufacturing and stock broking.
He does not have any family relationship with any director of UMLand. He is a nominee of Tradewinds Corporation Berhad, a major shareholder of UMLand and a brother to YBhg Tan Sri Dato’ Syed Mokhtar Shah bin Syed Nor, a deemed substantial shareholder of UMLand. Hence, he is deemed to be interested in certain recurrent related party transactions of a revenue and trading nature which are necessary for the day-to-day operations of which UMLand and its subsidiaries may enter with Tradewinds Corporation Berhad and its Group. He has never been charged for any offence and there has been no business arrangements with UMLand in which he has personal interests.
Syed Azmin Bin Mohd Nursin @ Syed Nor Non-Independent Non-Executive Director Age : 46 Nationality : Malaysian UNITED MALAYAN LAND BHD (4131-M) 27
Ng Eng Soon was appointed to the Board of UMLand on 31 October 1995. He is currently the Executive Director of Chee Tat Holdings (S) Pte Ltd.
He graduated from the London School of Economics, United Kingdom with a Bachelor of Science Degree majoring in Economics.
Ng Eng Soon is a brother to Dato’ Ng Eng Tee, the Deputy Chairman/ Executive Director of UMLand. He is a nominee of Chee Tat Holdings (S) Pte Ltd, a major shareholder of UMLand. Hence, he is deemed to be interested in certain recurrent related party transactions of a revenue and trading nature which are necessary for the day-to-day operations of which UMLand and its subsidiaries may enter with Chee Tat Holdings (S) Pte Ltd. He has never been charged for any offence and there has been no business arrangements with UMLand in which he has personal interests.
Ng Eng Soon Non-Independent Non-Executive Director Age : 53 Nationality : Singaporean 28 UNITED MALAYAN LAND BHD (4131-M)
Profi le of Directors
Pakhruddin bin Sulaiman was appointed to the Board of UMLand on 27 August 2007. He is a member of the Risk Committee and Audit Committee of UMLand.
Pakhruddin graduated from the University of London, United Kingdom with a Bachelor Degree in Law. He is also a Barrister-at- law from Lincoln’s Inn.
He started his career in 1985 as a legal assistant of several legal fi rms. He joined Mohd Khamil & Co as its Managing Partner in 1993. He is currently the Managing Partner of Pakhruddin & Partners.
He also sits on the Board of Tradewinds Plantation Berhad.
Pakhruddin does not have any family relationship with any director or major shareholder of UMLand. He has never been charged for any offence and there has been no business arrangements with UMLand in which he has personal interests.
Pakhruddin Bin Sulaiman Independent Non-Executive Director Age : 53 Nationality : Malaysian UNITED MALAYAN LAND BHD (4131-M) 29
Lim Wie Shan joined the Board of UMLand as alternate director to Chan Say Yeong on 1 August 2008 and alternate to Hazel Chew Siew Cheng on 31 October 2009.
Lim Wie Shan is currently a director of MCDF Investment Pte Ltd and MCDF Management Pte Ltd.
He graduated from the Nanyang Technology University with a Bachelor of Engineering (Hons) degree in 1993 and has a post-graduate Master of Science (Civil) and MBA from the National University of Singapore and Imperial College, University of London respectively. He completed the Executive Development Program in Wharton School of the University of Pennsylvania.
In 1997, he joined Pidemco Land Limited (now known as CapitaLand Limited). He is currently the Senior Vice President, Investment and Asset Management - Vietnam of CapitaLand Commercial Limited. He is also a director of MCDF Investment Pte Ltd and MCDF Management Pte Ltd, focusing on Malaysia.
Lim Wie Shan does not have any family relationship with any director or major shareholder of UMLand except by virtue of being a nominee of CapitaLand, a major shareholder of UMLand. Hence, he is deemed to be interested in certain recurrent related party transactions of a revenue and trading nature which are necessary for the day-to-day operations of which UMLand and its subsidiaries may enter with the CapitaLand Group. He has never been charged for any offence and there has been no business arrangements with UMLand in which he has personal interests.
Lim Wie Shan (Alternate to Chan Say Yeong and Hazel Chew Siew Cheng) Non-Independent Non-Executive Director Age : 41 Nationality : Singaporean 30 UNITED MALAYAN LAND BHD (4131-M) management team
Seated (from left) Pee Tong Lim Wong Kuen Kong
Standing (from left) Mohd Noor Abdul Salam Zulkifl y Garib Ng Tay Guan UNITED MALAYAN LAND BHD (4131-M) 31
SENIOR MANAGEMENT TOWNSHIP MANAGEMENT
Pee Tong Lim Ng Tay Guan Wong Kuen Kong Group Chief Executive Offi cer General Manager, General Manager, Age : 60 Nationality : Malaysian Bangi Heights Development Sdn. Bhd. Dynasty View Sdn. Bhd. Age : 54 Nationality : Malaysian Age : 55 Nationality : Malaysian Pee Tong Lim joined the UMLand Group in March 2005 as Director, Finance & Corporate. In this Ng Tay Guan joined Bangi Heights Development Wong Kuen Kong joined Seri Alam Properties Sdn. portfolio he was responsible for the fi nancial Sdn Bhd, a subsidiary of UMLand Group in April Bhd., a wholly-owned subsidiary of UMLand, in management, treasury function and corporate 1997 as Assistant General Manager responsible 1990 as Head of Finance in Corporate & Finance development of the Group. He assumed the for the Project development in Bandar Seri Putra Division responsible for the day to day fi nancial position of Group Chief Executive Offi cer on 16 Township. He was appointed as the General management. He was subsequently assigned to September 2009. He is responsible for the strategic Manager in January 2005 and is responsible for the Dynasty View Sdn Bhd as Acting Vice President direction and overall management and operations overall operation of Bangi Heights Development in April 2005 to drive and take charge of the of the Group. Sdn. Bhd. then new township known as Taman Seri Austin which was successfully launched in July 2005. He graduated with a Bachelor of Accountancy He graduated with Bachelor of Science Degree in He left the Group and ventured into consultancy Degree from the University of Singapore and is Civil Engineering from National Taiwan University, services in 2007. a registered member of The Institute of Certifi ed Taipei, Taiwan and a Master of Engineering Degree Public Accountants, Singapore and a Fellow of the in Construction Management from Asian Institute He re-joined UMLand Group in October 2008 as Association of Chartered Certifi ed Accountants, of Technology, Bangkok, Thailand. He began his General Manager for Dynasty View Sdn. Bhd. to United Kingdom. career as a Consultant Civil Engineer in 1982, boost Taman Seri Austin township to its highest started with Jurutera Konsultant (SEA) Sdn Bhd and level to compete with the many established He has many years of experience in merchant joined Abu Bakar & Associates Sdn Bhd in 1984. surrounding developments. He is taking charge banking being involved in corporate fi nance, and responsible for the overall management and advisory and planning. He has held various senior He has 20 years of property development operation of the Taman Seri Austin development. positions in both private and public entities in experiences. He left the consultancy services and Malaysia and Singapore. He was also a Director and joined Country Heights Sdn Bhd in 1989 as the He has more than 20 years experience in property member of the Audit Committee of the Company Project Manager and was appointed in 1994 as the development and is currently a member of the from October 1995 to March 2005. Head of Project Department of Country Heights Malaysian Association of Company Secretaries. He Holding Bhd until October 1995. Prior to joining began his career as Senior Audit Assistant in an Mr Pee does not have any family relationship with Bangi Heights Development Sdn. Bhd. in April Australian Audit fi rm in 1975. He then took up the any director or major shareholder of UMLand. He 1997, he was the General Manager of Hua Yang position as Group Accountant for Hong Huat Realty has never been charged for any offence and there Development Sdn Bhd. Sdn. Bhd. and Datong Holdings Bhd. in 1981 & has been no business arrangements with UMLand 1982 respectively before joining Tai Wah Garments in which he has personal interests. & Knitting Factory Sdn. Bhd. as Accountant in Mohd Noor Abdul Salam 1988. In 1990 he decided to go back to property General Manager, sector and joined Chee Tat Plantations Sdn. Bhd. Zulkifl y Garib Seri Alam Properties Sdn. Bhd. which is now known as Seri Alam Properties Sdn. Director, Operations Age : 50 Nationality : Malaysian Bhd. Age : 49 Nationality : Malaysian Mohd Noor Abdul Salam joined UMLand Group Zulkifl y Garib joined the UMLand Group in in 2007 as General Manager for Seri Alam August 2006 as Director of Operations and is Properties Sdn. Bhd. and is responsible for the responsible for the Group’s portfolio of township Township’s overall development. development projects. He graduated with a Bachelor in Civil Engineering He graduated with a Bachelor of Science from Universiti Teknologi Malaysia in 1983 and degree in Civil Engineering from The Hatfi eld started his earlier career as Executive Engineer Polytechnic, United Kingdom and began his with DBKL before joining the private sector career as a consultant civil engineer in 1986. He and managing the Johor Bahru Water Supply then took up positions as a Geotechnical Engineer Privatization Project in 1992. He was also involved and subsequently as Facilities Engineer with in the successful implementation for the water PLUS Berhad and UMW Corporation Sdn Bhd privatization schemes in the State of Selangor respectively. Darul Ehsan and Kelantan Darul Naim. He has over 15 years of property development Prior to joining UMLand Group, he was managing experience and held senior managerial positions the Penang Outer Ring Road (PORR) Highway with Land & General Berhad. Prior to joining Privatization Projects including 500 acres UMLand, he was the Senior General Manager Reclamation Works in Gurney Drive and Middle of UDA Holdings Bhd and head of the Group’s Bank. Township Division.
Zulkifl y Garib has served in the committee of the Building Services Technical Division of the Institution of Engineers, Malaysia and is presently a committee member of the REHDA Johor branch. He does not have any family relationship with any director or major shareholder of UMLand. He has never been charged for any offence and there has been no business arrangements with UMLand in which he has personal interests.
32 UNITED MALAYAN LAND BHD (4131-M)
MANAGEMENT TEAM MANAGEMENT OPERATIONS
United Malayan Land Bhd Seri Alam Properties Sdn. Bhd. Bangi Heights Development Sdn. Bhd. and Dynasty View Sdn. Bhd. Lim Chin Tian Ng Tay Guan Technical Consultant Mohd Noor Abdul Salam General Manager General Manager, Mohd Dinniah Yusof Seri Alam Properties Sdn. Bhd. (SAP) Woo Wee Tiong Senior General Manager, Tax Advisory Senior Manager, Project Management Wong Kuen Kong Long Foo Lum General Manager, Yasmin Daud General Manager, Business Development Dynasty View Sdn. Bhd. (DVSB) Senior Manager, Township Management
Tengku Mahmood Tengku Ismail Tan Siew Peng Mun Choong Jan General Manager, Group Technical Liason/ Assistant General Manager, Finance Senior Manager, Finance Acting Head, Group Human Resources & Administration Tan Kiat How Aw Wee Kiat Assistant General Manager, Manager, Liaison Gan Teong Hock Asset Management and Support Services Financial Controller Au Kar Sheng Mohd Saifuddin Salehuddin Manager, Sales & Marketing Chong Sumi Leong Assistant General Manager, General Manager, Projects Facilities & Management Suasana Sentral Two Sdn. Bhd. Zuraidah Mohd Yusoff Chang Siau Ham Norulhudai Nasir Assistant General Manager, Secretarial / Legal Senior Manager, Sales & Marketing (SAP) Senior Manager, Finance & Risk Management Leong Chooi Kuen Law Teck Seng Assistant General Manager, Manager, Liaison Teo Lian Seng Corporate, Tax Planning and Risk Management Senior Manager, Projects Cheng Siew Lee Neoh Kim Wah Assistant Manager, Sales & Marketing (DVSB) Assistant General Manager, Group Marketing & Sales
Yap Man Ying Senior Manager, Finance
Lim Siang Joo Senior Manager, Information Technology
Ab Aziz Ab Hamid Manager, Group Security
Wan Farhana Kamaruddin Assistant Manager, Public Affairs UNITED MALAYAN LAND BHD (4131-M) 33 34 UNITED MALAYAN LAND BHD (4131-M) passion
Passion drives us to deliver exciting ideas and concepts that transform innovation into superior quality and inventions. Our passion is evident as we consistently deliver outstanding developments in our townships and niche projects. UNITED MALAYAN LAND BHD (4131-M) 35 36 UNITED MALAYAN LAND BHD (4131-M)
Operations Review UNITED MALAYAN LAND BHD (4131-M) 37
PREAMBLE The construction sector, however, expanded The year under review started off with the by 5.7% in 2009 with much of it due to on- country undergoing a recession, which lasted going infrastructure projects implemented for three consecutive quarters as the export- under the Ninth Malaysia Plan. This, together led economy declined following the slow with Government spending in the form of down in global demand. This in turn had an the two stimulus packages worth a total of adverse effect on the economy which saw RM67 billion, the cuts in interest rates and consumers rein in spending especially on big- easier access to fi nancing, contributed to a ticket items such as properties and passenger strong recovery within the sector based on cars. domestic demand in the second half of the year. On the positive side, building material prices were relatively lower compared to the previous Besides the fi scal and monetary measures, year, and together with benign infl ation, lower the growth of exports in the second half of interest rates and government spending, the year onwards also boosted consumer the impact was somewhat mitigated with sentiment. This was refl ected in the fourth consumer sentiment picking up towards the quarter as the economy registered positive end of the year. recovery when it achieved an expansion of 4.4% on sustained growth in private consumption and increased public sector THE ECONOMY IN 2009 spending. Unlike the previous year where there was a surge in infl ation, the economy in the year FINANCIAL RESULTS under review was characterised by a generally cautious mood induced in large part by the With the country facing the challenges recession. brought upon by the recession, the Group had anticipated a tough year in 2009. According to the Bank Negara annual report Nevertheless, despite the challenges of for 2009, the economy contracted by 1.7% a diffi cult year, we are pleased to report in 2009 compared to a growth of 4.6% in that the Group managed to post a net 2008. Sentiments were further dampened profi t of RM55.0 million in the year ended as the drop in global demand impacted the 31 December 2009 (FY2009) compared to a manufacturing sector, which saw double- loss of RM3.5 million in the year ended 31 digit declines in both exports and factory December 2008 on revenue that rose 21% output. to RM208.5 million.
The rebound in revenue and net profi t for FY2009 was largely due to several strategic land sales in the township of Bandar Seri Alam and the stronger profi t contribution from Bandar Seri Putra and Suasana Bangsar.
TOWNSHIP DIVISION Due to the economic uncertainties during the year, the Group scaled back on its property launches in all its three township The Group will increase launches in 2010 in developments, namely Bandar Seri Alam and Taman Seri Austin both in Iskandar Malaysia, both Township and Niche Divisions with gross Johor, and Bandar Seri Putra in Bangi, development values exceeding RM0.5 billion. Selangor. 38 UNITED MALAYAN LAND BHD (4131-M)
Operations review
The Group took the opportunity to relook at its long-term plans and made adjustments to its on-going strategies which included reviewing the master plans and products of the three townships.
In this respect, certain strategic land sales in Bandar Seri Alam were identifi ed and sold to several institutions of higher learning, namely Mara Junior Science College, better living environment and to better meet Universiti Kuala Lumpur, Universiti Teknologi the ever-changing market needs. Towards this Mara, Masterskill University College of objective, the Group had undertaken several Health Sciences and an Arts College. As community and environment initiatives in a result of this development, Seri Alam is Seri Austin during the year such as the eco being transformed into an education hub, as microorganism water treatment facility and it rebrands itself as a “City of Knowledge”. the safe home campaign which was carried out in cooperation with the local police. Besides the establishment of these institutions of higher learning, the township Further up North and closer to Kuala Lumpur, also has other amenities such as the Regency Bandar Seri Putra township was one of the Hospital, the Octville Golf and Country Club, major contributors to the Group’s revenue and Tesco hypermarket and several 24-hour food profi ts during the year. Despite the economic outlets. situation, there was a marked improvement in prices and strong sales take-up rate for These amenities are further augmented the new launches of semi-detached houses, by the presence of the Iskandar Malaysia bungalows and shop offi ces. The increase Eastern District police headquarters within in demand for high-end products is due to Seri Alam, which further enhances the its strategic location as well as it being at a appeal of the township. With safety being mature stage of development and this has one of the major concerns among residents, provided Seri Putra with the impetus to focus the presence of the police headquarters will on high-end developments for the remaining Suasana Bangsar, a freehold 25-storey largely address the security concerns and landbank in the township. 190-unit high-end condominium project thus provides peace of mind to the people launched in July 2008, is nearing completion working and living in the township. As at 31 December 2009, the Group still and expected to be completed in 2010. Total has a total landbank of approximately 1,606 sales for Suasana Bangsar units have reached The anticipated growth in student population acres of freehold land to be developed in 85% thus far. and the expected change in demographics its township division, with an estimated will act as a catalyst for further development gross development value of approximately Moving forward, the Group plans to launch and enhance the value of Seri Alam as a RM5 billion. Suasana Bukit Ceylon, a 310-unit high-end choice location. With this in mind, Seri Alam serviced apartment project along Jalan Raja will tailor its products to specifi cally meet Chulan in the heart of Kuala Lumpur, in the NICHE DIVISION changing market demands and cater for later part of 2010. the needs of the population, in its future Apart from the three township developments, development plans for the balance landbank the Group is also developing niche projects in Following this, the Group expects to launch of approximately 1,200 acres. the Klang Valley and Iskandar Malaysia. The a fi ve-storey serviced apartment project with niche division has contributed signifi cantly to retail spaces in Puteri Harbour, the integrated On a similar note, the Group had also taken Group revenue and we expect it will continue waterfront and marina development in the opportunity to review the master plan to provide the Group with a steady revenue Bandar Nusajaya, Iskandar Malaysia. This and products of Taman Seri Austin, our other stream in the coming years. development is a 50:50 joint venture with township development in Johor. The review UEM Land. was conducted with a view of creating a UNITED MALAYAN LAND BHD (4131-M) 39 40 UNITED MALAYAN LAND BHD (4131-M) UNITED MALAYAN LAND BHD (4131-M) 41
Operations review
Our strategic land sales for establishment of Universiti Teknologi Mara, Masterskill University College of Health Sciences, Universiti Kuala Lumpur and Mara Junior Science College is fast transforming Bandar Seri Alam into an education hub as it rebrands itself as a “City of Knowledge”.
Meanwhile, other niche projects in the As the Group’s three townships mature As part of the Group’s growth strategy, it pipeline are the Matex project with mixed and facilities increase with the growing will continue to engage with strategic joint commercial and serviced residence elements population, the outlook for the township venture partners for viable projects in the in Jalan Wong Ah Fook Johor Bahru; Ipjora division is expected to be good with further future. Additionally, the Group will also project which is planned as a budget hotel in opportunities to be tapped. In view of this, continue to look into strategic land sales Bukit Ceylon area in Kuala Lumpur; and the the Group plans to increase the number of that will add value to its townships although Mayang project (a 50:50 joint venture with product launches in all its three townships the contribution of such sales to revenue Bolton) in the vicinity of KLCC. in 2010. Introducing new products to cater and profi t may not be as signifi cant going to the ever-changing market environment as forward. well as to improve effi ciency in land usage PROSPECTS will continue to be emphasized. The economic turnaround since the fourth ACKNOWLEDGEMENTS quarter of 2009 improved further in 2010 Revenue contributions from the Group’s niche The management takes this opportunity to with a growth of 10.1% being registered division in the year ending 31 December 2010 thank the Board of Directors for their support in fi rst quarter and a 6% growth forecasted is expected mainly from Suasana Bangsar. and guidance which was especially important for the full year. This is expected to have a Contribution from Suasana Bukit Ceylon is in the challenging year that has passed. positive impact on the real estate sector in not expected to be signifi cant in 2010, since 2010 as the anticipated pent-up demand will the project will only be launched towards Also, the management would like to thank drive the property market . the end of the year, but will come on stream the staff for their dedication, hard work thereafter. Likewise, revenue contribution and loyalty, through the turbulent times, With the improvement in economic from the other niche projects will only be without which the Group would not be able conditions and to prevent any fi nancial expected after 2010 when these projects are to achieve the commendable results for the imbalance that could take place should rates launched. year under review. remain too low for longer than necessary, Bank Negara raised its overnight policy rate The Group will expand its activities in Iskandar Last but not least, we would also like to extend by 25 basis points to 2.25% in March 2010 Malaysia further with the joint venture our appreciation to our stakeholders, namely and then to 2.5% in May 2010. This may with Tradewinds Johor Sdn Bhd for the our valued customers, fi nanciers, business result in a moderate increase in the rate of development of a 600-acre land near Pulai partners and the various local authorities, infl ation and bank lending rates in respect of Jaya. The acquisition of this parcel of 600- without whose support we would not be in end fi nancing. acre land, situated next to a Technology Park the healthy position we are in today. and strategically located near Senai Airport The Group takes a long-term view where with good linkages to Bandar Nusajaya and township development is concerned with Singapore, is pending completion. a strong emphasis on value creation as the townships under the Group mature and commercial centres within these townships Pee Tong Lim are developed. Group Chief Executive Offi cer 42 UNITED MALAYAN LAND BHD (4131-M) care
The UMLand stewardship of environment and contribution to communities refl ects the way we conduct our operations to minimise the impact on the planet; the stringent quality we require of our projects and the initiatives we carry out aims to improve the lives of the people and organisations we assist. UNITED MALAYAN LAND BHD (4131-M) 43 44 UNITED MALAYAN LAND BHD (4131-M) Corporate Responsibility
At UMLand, we view Corporate Responsibility (CR) as an integral part of our business and fi rmly believe that our long-term success and sustainable growth is intrinsically linked to the way we conduct ourselves in dealing with our stakeholders which include our shareholders, employees, partners, customers, regulators and the government.
Internally, we strive to inculcate socially responsible behaviour and practices among all our employees, which in turn will refl ect on how we act as a company. At the corporate level, we will ensure that we operate in a fair and equitable manner, ensuring proper governance and transparency in all that we do.
We realize that profi ts are not the only measurement for success; and we need to also look at how we impact the communities around us. This forms the basis of our CR strategy, which revolves around four main pillars – Community Engagement; Responsibility to the Environment; Enabling Communities through Education; and Human Resource Development.
Community Engagement As a responsible property developer, we are more than just a “brick and mortar” business – we see ourselves as community builders whereby community engagement has always been an integral component of our business philosophy. Part of our business ethos include the long-term benefi ts we bring to all Malaysians, and this goes beyond creating products and services that meet the needs of our customers.
Throughout the year under review, we have made various contributions and carried out community engagement activities, both at Group and subsidiary levels. These include a charity fund-raising event in conjunction with Mothers’ Day; a “Safe Home” campaign; festive celebrations and berbuka puasa with the less fortunate; as well as direct contributions to school and welfare funds.
We hope that through our activities, we have made a difference in the lives of the various communities we interact with.
Responsibility to the Environment Environmental concerns have been at the top of the agenda for many companies, and we are no different in that we too see the preservation of the environment as a critical component in the sustainability of our business, the nation and the world.
Key to the success of our environmental initiative is our approach in nurturing a culture of responsibility within the Group as a continuous improvement process, which includes educating our employees on the environmental cause. We then look at how we can infl uence our other stakeholders, especially homeowners and our customers to adopt a green attitude and to get them to do their part in preserving and protecting the neighbourhoods they live in. UNITED MALAYAN LAND BHD (4131-M) 45
We believe that in order to do so, we need to ‘walk the talk’, and take the lead in providing an environment that promotes conservation and peaceful coexistence with nature. To this end, we have adopted the philosophy of greening the townships we have developed, as well as incorporate an environmental component in our planning process for new developments.
An example of our commitment to the preservation of nature and its depleting resources is the use of Effective Microorganism Bio Technology for water treatment in Taman Seri Austin, which eliminate or reduce the volumes of sludge produced, with the benefi ts of reduced sludge handling, and consequently lower costs and decreased impacts upon the environment.
As a further demonstration of our commitment, we took part in the Earth Day celebrations with several activities involving the residents of our various townships.
Enabling Communities through Education Education is a great enabler, and we aim to do our part in nurturing the nation’s youth by providing them with a strong and solid foundation. Excellent schools and well-educated youths are important building blocks in our country’s development, as they will form the workforce of the next generation. In recognition of excellent academic performances in public examinations (UPSR, PMR, SPM and STPM) achieved by the children of residents in Bandar Seri Alam, the Group has an annual “student excellence award” in the form of cash prizes and certifi cates.
In addition to various community interactions with schools in the various townships, we have also organized campaigns and activities to raise awareness on environmental issues, which we believe will instill a strong sense of responsibility among school children.
Human Resource Development People are our most valuable asset, and to succeed we have to ensure that we create a work environment that will allow them to fl ourish. We are committed to the development and well being of our employees, and as part of our Corporate Responsibility we provide ongoing education and training opportunities. The Group has a total of 261 staff and during the year under review we sent several of them to 38 training courses, and conducted 2 in-house training programs.
Social activities also form an integral part of our human resource development program, as we aim to forge a sense of camaraderie amongst our employees. We believe that beyond the education and training programs, this will develop a strong team spirit that will take the group to further heights. 46 UNITED MALAYAN LAND BHD (4131-M) Corporate Calendar
JANUARY 2009 PROPOSED SHAREHOLDING RATIONALISATION OF BANGI HEIGHTS DEVELOPMENT SDN BHD United Malayan Land Bhd (UMLand) With the aim of improving the Group’s overall structure and operational effi ciency, UMLand restructured its 70% shareholdings in Bangi Heights Development Sdn Bhd via a shareholding rationalisation exercise.
FEBRUARY 2009
A CHINESE NEW YEAR CELEBRATION WITH HOUSE OF JOY A United Malayan Land Bhd & Bangi Heights Development Sdn Bhd Then Group Chief Executive Offi cer Anthony Yap led 20 employees to a visit to the House of Joy to hand out ‘Ang Pow’ packets and hampers to 70 orphans and 30 old folks at their home in Semenyih, Kajang in celebration of Chinese New Year.
CHAP GOH MEI FESTIVAL B Taman Seri Austin, Iskandar Malaysia Dynasty View Sdn Bhd, the developer of Taman Seri Austin, organised a Lion Dance Performance and “Yee-Sang” in its township in Taman Seri Austin, Iskandar Malaysia in conjunction with its sales activities to celebrate the Chap Goh Mei festival.
B UNITED MALAYAN LAND BHD (4131-M) 47
MARCH 2009 VANDA HAND OVER KEY CEREMONY C Taman Seri Austin, Iskandar Malaysia Dynasty View Sdn Bhd, the developer of Taman Seri Austin, handed over the keys to 40 units of Vanda Homes to eager home owners witnessed by YB Datuk Mohd Naim Nasir, Johor Bahru’s City Mayor. This was to celebrate the early delivery of homes complete with certifi cate of fi tness to purchasers.
EFFECTIVE MICROORGANISM AWARENESS CAMPAIGN Taman Seri Austin, Iskandar Malaysia C An effective microorganism awareness campaign was held to provide the community with basic information on environment-friendly products right out of their own kitchens. Effective Microorganism is a solution containing various benefi cial microorganisms found in nature and used in foods. Usage of this solution in Taman Seri Austin is fully supported by the local authority, Majlis Bandaraya Johor Bahru.
APRIL 2009 EARTH DAY CELEBRATION D Taman Seri Austin, Iskandar Malaysia In conjunction with the World Earth Day on 22 April 2009, Dynasty View Sdn Bhd organised its very own Seri Austin Earth Day to advocate the public in its quest for a greener and safer environment. Present to witness the event was YB Tan Kok Hong, Chairman of Johor Exco for International Trade & Industry, Energy, Water, Communication & Environment.
MAY 2009 MOTHER’S DAY CHARITY FUND-RAISING EVENT D Taman Seri Austin, Iskandar Malaysia In its bid to help single mothers to improve their lives, Dynasty View Sdn Bhd successfully raised RM25,000 through its charity fund-raising programme, in collaboration with the Persatuan Soka Gakkai Malaysia. The event attracted more than 4,000 people to Taman Seri Austin to witness the auspicious event with Puan Hajah Aishah bte Abdul Kapi, Deputy Secretary of Majlis Bandaraya Johor Bahru as the guest of honour. 48 UNITED MALAYAN LAND BHD (4131-M)
JUNE 2009 UMLAND’S 48TH ANNUAL GENERAL MEETING E United Malayan Land Bhd (UMLand) UMLand held its 48th Annual General Meeting (AGM) at Crowne Plaza Mutiara Kuala Lumpur whereby shareholders approved the audited fi nancial statements for the fi nancial year ended 31 December 2008.
The shareholders also approved the payment of a fi nal dividend of 2.5 sen per ordinary share less 25% income tax for the fi nancial year.
At this AGM, UMLand also sought and obtained its shareholders’
E mandate to buy-back up to maximum of 5.80 million ordinary shares or approximately 2.40% of its existing issued and paid-up share capital. The share buy-back aims to stabilise the supply and demand of its shares, thereby supporting its fundamental value.
To ensure smooth business operations, UMLand also sought and obtained the renewal of its shareholders’ mandate for the existing and new recurrent related party transactions of a revenue and trading nature and provision of fi nancial assistance
LAUNCH OF LAMAN INDAH PHASE 7(5) F Bandar Seri Putra, Bangi Launch of Laman Indah for early registrants comprising 56 units of double-storey terrace house with a built-up area of 1,867 sq ft and priced from only RM322,000 - located in the mature township of Bandar Seri Putra, Bangi, Selangor.
F JULY 2009 LAUNCH OF DEANNA II & SERI AUSTIN’S 4TH ANNIVERSARY! G Taman Seri Austin, Iskandar Malaysia Launch of Deana II - 122 units of double-storey terrace house located within the gated and guarded community at EastZone, Taman Seri Austin, Iskandar Malaysia is spaciously designed with 4 bedrooms and 4 bathrooms, with a built-up area of 1,947 sq ft and priced from only RM268,000. Dynasty View Sdn Bhd successfully sold 60% during the launch which was attended by YB Dato’ Hj Abdul Halim Suleiman, ADUN of Puteri Wangsa. The township also celebrated its 4th Anniversary!
G UNITED MALAYAN LAND BHD (4131-M) 49
AUGUST 2009 MASTERSKILL TO SET UP CAMPUS IN SERI ALAM H United Malayan Land Bhd (UMLand) & Seri Alam Properties Sdn Bhd Masterskill (M) Sdn Bhd, a subsidiary of Masterskill Education Group Berhad signed a Sale and Purchase Agreement with Seri Alam Properties Sdn Bhd to set up a campus in Bandar Seri Alam, Johor. The ceremony was witnessed by Yang Teramat Mulia Raja Dato Seri Azureen binti Sultan Azlan Muhibbuddin Shah, the Chancellor of Masterskill University College of Health Sciences and the Minister of Higher Education Malaysia, Yang Berhormat Dato Seri Mohamed Khaled Nordin, who was joined by Dato Edmund Santhara, Executive Director and CEO of H Masterskill Education Group Berhad and Yang Berbahagia Dato Ng Eng Tee, Deputy Chairman and Executive Director of UMLand.
Masterskill’s presence in Bandar Seri Alam is a further step in making the township into a City of Knowledge where the best academic minds are brought together and moulded for the benefi t of a nation.
SEPTEMBER 2009 BERBUKA PUASA WITH ORPHANS I Bandar Seri Alam, Iskandar Malaysia The event was held at Bandar Seri Alam’s corporate offi ce with the presence of 50 orphans and committee of Suraus and Masjids within Bandar Seri Alam. Donations worth RM1,000 and RM500 were given to the Masjid and Surau committees, respectively. Present to witness the event was Tuan Hj Md. Fuzi Ahmad Shamimi, Yang Dipertua Majlis Perbandaran Johor Bahru Tengah. I BERBUKA PUASA AND CONTRIBUTION TO CANCER PATIENTS Taman Seri Austin, Iskandar Malaysia Dynasty View Sdn Bhd (DVSB) contributed RM 4,500 to 15 cancer patients of all races and age group, identifi ed by the National Cancer Council (MAKNA) whereby each patient received RM300 cash and a goodie bag.
Also, approximately 100 people including staff of DVSB, Taman Seri Austin’s Resident Committee and family members of the patients joined in the buka puasa function which was held for the very fi rst time in Taman Seri Austin. YB Dato’ Hj Abdul Halim Suleiman, ADUN Puteri Wangsa was present to support and witness the event. 50 UNITED MALAYAN LAND BHD (4131-M)
J K
OCTOBER 2009 UMLAND’S EGM TO APPROVE ACQUISITION OF 629-ACRE LAND IN ISKANDAR MALAYSIA J United Malayan Land Bhd (UMLand) Shareholders approved UMLand’s 51:49 joint venture with Tradewinds Johor Sdn Bhd and its proposed acquisition of a 629-acre parcel of land within Bandar Pulai Jaya for a total cash consideration of RM233.0 million. The joint venture company, Extreme Consolidated Sdn Bhd, signed a conditional Sale and Purchase Agreement for the land acquisition and will develop the land into an industrial hub.
OFFICIAL LAUNCH OF ECO-MICROORGANISM Taman Seri Austin, Iskandar Malaysia The launch of the eco-microorganism programme at Seri Alam’s corporate offi ce was witnessed by Tuan Haji Yahaya bin Mohd Salleh, District Offi cer of Johor Bahru. The programme is part of Dynasty View Sdn Bhd’s effort to promote a clean and greener environment for its community in its township.
L LAUNCH OF ANJUNG SUASANA PHASE 8B BUNGALOWS AND SEMI- DETACHED HOMES K Bandar Seri Putra, Bangi Anjung Suasana homes are designed for traditional living with its kampong-style design concept with features such as serambi, courtyard and lanai to compliment its natural surroundings. Priced from RM 600,000 – 800,000, the launch of the 54 units of bungalows and semi-detached units received positive response from home buyers who are keen on living in the mature township of Bandar Seri Putra in Bangi, Selangor.
NATIONAL HOUSING AND PROPERTY SUMMIT 2009 L United Malayan Land Bhd (UMLand) UMLand participated in the prestigious National Housing and Property Summit at Sunway Resort Hotel & Resort, Petaling Jaya. The summit was organised by the Asian Strategy and Leadership Institute (ASLI), which was supported by FIABCI Malaysia and The National House Buyers Association, in its bid to provide a platform for property industry players to brainstorm, exchange and deliberate new ideas. UNITED MALAYAN LAND BHD (4131-M) 51
NOVEMBER 2009 UMLAND POISED TO KICK START DEVELOPMENT IN PUTERI HARBOUR, NUSAJAYA United Malayan Land Bhd (UMLand) Nusajaya Consolidated Sdn Bhd, a 50:50 joint venture company between UMLand and UEM Land Berhad, acquired a piece of 2.2-acre land in Puteri Harbour, Nusajaya for RM16.3 million to develop it into two blocks of 5-storey boutique waterfront apartments complemented by retail space at the ground fl oor.
LAUNCH OF DEANNA III DOUBLE-STOREY TERRACE HOMES M Taman Seri Austin, Iskandar Malaysia M The launch of Deanna III was graced by Guest of Honour, En. Abdul Rahman Abdullah, Corporate and Public Affairs Director of Majlis Bandaraya Johor Bahru.
Deanna III comprises 58 units of 20’x70’ double storey terrace house, with built-up area of 2,114 sq ft., 4 bedrooms and 3 bathrooms and priced from only RM286,800. Amongst the added features in Deanna III are wide car porch & staircase, spacious living, dining and master bedroom and full height tiles for bathrooms.
CONTRIBUTION TO SCHOOL & KPRA WELFARE FUND N Taman Seri Austin, Iskandar Malaysia Dynasty View Sdn Bhd (DVSB) contributed school bags, dictionaries and stationery sets to children from Sekolah Kebangsaan Taman Daya 2, Sekolah Jenis Kebangsaan Tamil Ladang Tebrau and Sekolah Jenis Kebangsaan Cina Foon Yew 5. In addition, DVSB also made a generous contribution of RM 1,750 to the Kesatuan-kesatuan Pekerja-pekerja Rendah Awam Pihak Berkuasa Tempatan Negeri Johor (KPRA-PBTNJ) for the purchase of fi ve wheelchairs for their members. These charitable events are part of the community programme by DVSB as a caring developer.
N DECEMBER 2009 UMLAND PROPERTY FAIR AT TEBRAU CITY Bandar Seri Alam & Taman Seri Austin, Iskandar Malaysia This event was held at Jusco Tebrau City and it was a success in creating awareness to the general public about the Township Development in Eastern Corridor of Iskandar Malaysia undertaken by the UMLand Group.
FEBRUARY 2010 A PINKY GALA DINNER O Bandar Seri Alam, Iskandar Malaysia Seri Alam Properties Sdn Bhd (SAP) organised an Annual Gala Dinner at the Hotel Grand Paragon, Johor Bahru in an effort to commemorate and appreciate the loyalty, support and performance of its staff. The theme of the night centered around the colour ‘PINK’ to refl ect the vibrancy and vivacity of the staff at SAP!
O 52 UNITED MALAYAN LAND BHD (4131-M)
SAFETY FIRST IN SERI AUSTIN P Taman Seri Austin, Iskandar Malaysia About 1000 people gathered at the Seri Austin Sales Gallery to witness the launch of Safe Home Campaign & OPS Sikap-21 in conjunction with the Chinese New Year Celebration 2010. The event was jointly organised by the Malaysian Crime Prevention Foundation (MCPF) Johor, Polis DiRaja Malaysia (PDRM), MCA Tebrau & Pasir Gudang Division and Dynasty View P Sdn Bhd (DVSB).
The campaign was offi cially launched by YDH DCP Dato’ Mohd Mokhtar bin Hj Mohd Shariff, Chief Police of Johor. Among the VIP were YDH SAC I Dato’ Hj Jalaluddin bin Abdul Rahman, the Deputy Chief Police of Johor, YB Tan Kok Hong, State Exco for International Trade & Industry, Energy, Water, Communication & Environment, YB Teng Boon Soon, Member of Parliament Tebrau, Senator Khoo Soo Seang and Mr Wong Kuen Kong, General Manager of DVSB. The campaign was attended by members of the Police Force, the MCA members, offi cials from the city council, NGOs from Chinese associations, media and the neighbouring residents.
KARNIVAL 1MALAYSIA Q
Q Bandar Seri Alam, Iskandar Malaysia Heeding the call of the government to strengthen the relationships with people from all walks of life, Seri Alam Property Sdn Bhd organised the Karnival 1Malaysia as a platform for the community, local residents and the local leaders to improve communications and relationships between all parties.
Activities held during the event included walkathon, health screening, blood donation, colouring contest, cooking contest, Education Expo, car show and telematches.
MARCH 2010 CHINESE NEW YEAR CELEBRATION AT AMPANG OLD FOLKS HOME R R United Malayan Land Bhd & Bangi Heights Development Sdn Bhd Newly appointed Group Chief Executive Offi cer, Mr. Pee Tong Lim led staff of both companies to a visit to the Ampang Old Folks Home to hand out “Ang Pow” packets to 50 old folks, hampers and cash worth RM1,000 to the home in Kampung Melayu Ampang, Kuala Lumpur.
A TRULY ASIAN CELEBRATION S United Malayan Land Bhd (UMLand) In the asian spirit of celebration, UMLand organised its Annual Gala Dinner at The Royale Chulan Hotel, Kuala Lumpur for its staff at headquarters and from Bangi Heights Development Sdn Bhd as a show of appreciation for their commitment and support for the Group. Present at the event to join the celebration were UMLand’s Chairman, YABhg Tun Musa Hitam and S UMLand’s Executive Director YBhg Dato’ Ng Eng Tee. With the theme ‘Asian Culture’, the activities of the night included Best Dressed, Best Staff Performance and other fun activities and games. UNITED MALAYAN LAND BHD (4131-M) 53
Corporate Governance Statement
The Board of Directors (Board) of United Malayan Land Bhd (UMLand) recognizes and subscribes to the importance of the principles and best practices set out in the Malaysian Code on Corporate Governance (Revised 2007) (the Code). The Board remains committed in ensuring the highest standards of corporate governance in the Company and would strive to continuously improve on its governance process and structures towards enhancing long-term shareholders and stakeholders values.
The Board views corporate governance as synonymous with four key concepts; namely transparency, integrity and accountability as well as corporate performance.
The following statement outlines the Group’s application of the Code for the fi nancial year under review.
BOARD OF DIRECTORS The present size and composition of the Board is well balanced comprising individuals of high calibre, with varied academic background and professional qualifi cations and experiences.
Board Composition and Balance The Board currently consists of nine (9) members and an (1) alternate director. There are eight (8) non-executive directors and one (1) executive director, of whom four (4) are independent. With this composition, the Board is in compliance with paragraph 15.02 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (Bursa Securities). Brief profi le of each director is presented under the Profi le of Directors disclosed in this Annual Report 2009.
All directors are jointly responsible for the corporate governance, strategic direction, formulation of policies and overseeing the resources, investments and businesses of the Group. The role of the independent non-executive directors is particularly important in ensuring that the strategies proposed by management are fully deliberated and examined taking into account the long term interest of the shareholders and other stakeholders in which the Group conducts its business.
There is a clear separation of role between the Chairman, the Executive Director (ED) and the Group Chief Executive Offi cer (GCEO) with clear division of responsibilities to ensure proper balance of power and authority. The ED and GCEO are responsible for the day-to-day management of the Group’s businesses with objectives and strategies established by the Board.
Appointments to the Board In order to comply with good practices for the appointment of new directors through a formal and transparent procedure, the Board has set up a Nomination Committee, which comprise exclusively of non-executive directors, to evaluate and recommend candidates for directorships to the Board and Board Committees.
Roles and Responsibilities The Board retains full and effective responsibility for the overall strategic direction of the Group. It ensures that management develops and maintains sound policies and practices which will help to promote and drive long term sustainable growth and shareholder value. To this end, the Board had assumed the following responsibilities in accordance with the best practices of the Code: • Determine the strategic plan for the Company and Group; • Overseeing the conduct of the Group’s businesses; • Managing principal risks affecting the Group; • Reviewing the adequacy and integrity of the Group’s internal control systems; • Implementing succession planning for timely succession of key management positions, within the Group; and • Maintaining an effective investor relations programme and shareholders communication policy for the Group. 54 UNITED MALAYAN LAND BHD (4131-M)
Corporate Governance Statement
Meetings The Board meets at least once every quarter on a scheduled basis with additional meetings convened as and when critical issues and decisions are required. There were four (4) quarterly scheduled board meetings and one (1) ad-hoc special board meeting held during the fi nancial year ended 31 December 2009. Meetings were held inter-alia to deliberate and consider a variety of signifi cant matters including the review of the Group’s strategic plans, budget, quarterly fi nancial statements, corporate proposals and other related business matters that require deliberation and approval.
Details of attendance of each director who was in offi ce during the fi nancial year ended 31 December 2009 are set out below. Directors Attendance % of attendance Tun Musa Hitam 5/5 100 Dato’ Ng Eng Tee 5/5 100 Chan Say Yeong 5/5 100 Datuk Syed Ahmad Khalid Syed Mohammed 5/5 100 Datuk Nur Jazlan Tan Sri Mohamed 2/5 40 1 Ng Eng Soon 5/5 100 Syed Azmin Mohd Nursin @ Syed Nor 5/5 100
Hazel Chew Siew Cheng 2 1/1 100 Pakhruddin Sulaiman 5/5 100
Chen Lian Pang 3 0/4 0 Lim Wie Shan (alternate to Chan Say Yeong and Hazel Chew Siew Cheng) 5 4/4 100 4
1 - Fulfi lled 50% meeting attendance for the quarterly scheduled board meetings for fi nancial year 2009 and was unable to attend one ad-hoc special board meeting held during year 2009 due to his overseas travel assignment 2 - Appointed on 31 October 2009 3 - Resigned on 31 October 2009 4 - Attended meeting as alternate to Chen Lian Pang 5 – Ceased as alternate to Chen Lian Pang on 31 October 2009 and appointed as alternate to Hazel Chew Siew Cheng on 31 October 2009. Note: Attendance record of alternate director shall be read in concurrence with attendance record of their respective Principals.
Supply of Information The Board has full and unrestricted access to all information pertaining to the Group’s businesses and affairs to enable them to discharge their duties effectively.
Prior to each Board meeting, all directors will receive the agenda and a set of comprehensive reports for each agenda item to be discussed, in a timely manner to enable directors to obtain further clarifi cation or explanation, where necessary, in order to be adequately informed before the meeting.
The directors also have access to independent professional advice, where necessary and appropriate, in the furtherance of their duties. All directors have full access to the advice and services of the Company Secretary. The Company Secretary attends to all corporate secretarial administration matters of the Group in addition to attending meetings of the Board and Board Committees.
Directors’ Training During the fi nancial year, all Directors had attended various training programmes and seminars organized by the relevant regulatory authorities and professional bodies to broaden their knowledge and to keep abreast with the relevant changes in law, regulations and the business environment. UNITED MALAYAN LAND BHD (4131-M) 55
Corporate Governance Statement
The training programmes, seminars and workshops attended by the Directors during the fi nancial year were, inter alia, on areas related to corporate leadership and governance, risk management and fi nancial reporting, details of which are listed below:-
Course/Title Date MIA Strategy Retreat 9 - 10 January 2009 Asia Outlook Strategy 16 January 2009 Risk Management Seminar 17 March 2009 The Future of Islamic Financial Services 7 - 8 May 2009 Forum on Corporate Governance Guide 8 June 2009 CommunicAsia 2009 18 - 19 June 2009 MAICSA Annual Conference 2009 - Shaping The Future Corporate Professional 6 - 7 July 2009 World Capital Market Symposium 10 August 2009 Corporate Governance Guide: Towards Boardroom Excellence 12 August 2009 National Accountants Conference 13 - 14 October 2009 Inaugural Malaysia Europe Forum - European Union KL Round Table 2009 - Sustainability and the Corporate Section: Striking a Balance 12 November 2009 Educational Visit to Iskandar Malaysia 19 November 2009
Re-election In accordance with the Company’s Articles of Association, one-third of the directors for the time being shall retire from offi ce at every Annual General Meeting (AGM). Retiring directors can offer themselves for re-election.
Directors who are appointed as additional directors or to fi ll casual vacancies during the year are subject to re-election by the shareholders at the next AGM following their appointments.
Directors who are over the age of seventy years are required to submit themselves for re-appointment annually in accordance with Section 129(6) of Companies Act, 1965.
Directorships in other Companies Pursuant to the Main Market Listing Requirements of Bursa Securities, each member of the Board shall hold not more than ten (10) directorships in public listed companies and not more than fi fteen (15) directorships in non-public listed companies. This ensures that their commitment, resources and time are focused for an effective input to the Board and the Company. All directors are in compliance with this requirement.
Directors’ Remuneration Directors’ remuneration is determined at levels which enable the Company to attract and retain directors with the relevant experience and expertise needed to manage the Group effectively. For executive directors, the components of remuneration are structured so as to link rewards to corporate and individual performance. For non-executive directors, the level of remuneration refl ects the experience and level of responsibilities undertaken by these directors.
The determination of remuneration packages for non-executive directors, including the non-executive chairman, is a matter for the Board as a whole. The directors concerned are required to abstain from deliberations and voting on decisions in respect of their individual remuneration. 56 UNITED MALAYAN LAND BHD (4131-M)
Corporate Governance Statement
The remuneration package of the directors is as follows:- i. Basic salary - Basic salary for executive director is recommended upon consideration of individual performance and rates of salary for similar positions in comparable companies.
ii. Fees - Directors’ fees are based on fi xed sum as determined by the Board after considering comparable organizations and their participation in various Board committees. The fees are approved by the shareholders at the AGM of the Company.
iii. Bonus Scheme - The Group operates a non-contractual bonus scheme for its executive directors, which is determined based on the Group’s level of profi t and individual’s performance during the period. Bonuses payable to executive directors are reviewed and approved by the Remuneration Committee after consultation with the Board.
iv. Benefi ts-in-kind - Other customary benefi ts such as medical care, car, driver, etc are made available as appropriate.
A summary of the total remuneration of the directors in offi ce for the fi nancial year ended 31 December 2009, distinguishing between executive and non-executive directors, in aggregate with categorisation into appropriate components and the number of directors whose remuneration falls into each successive bands of RM50,000 are disclosed below:
Executive Director Non-Executive Directors Total (RM) (RM) (RM) Basic salaries and bonus* 421,000 – 421,000 Fees 40,000 375,000 415,000 Meeting allowance 16,000 94,000 110,000 Benefi ts-in-kind 35,000 60,000 95,000 Total 512,000 529,000 1,041,000
* Inclusive of Company’s contribution to provident fund Executive Director Non-Executive Directors Total RM 0 - RM50,000 – 4 4 RM50,001 - RM100,000 – 5 5 RM150,001 - RM200,000 – 1 1 RM450,001 - RM500,000 – – – RM500,001 - RM550,000 1 – 1 RM550,001 - RM660,000 – – – Total 11011
Confl ict of Interest All directors have a continuing responsibility to determine whether they have a potential or actual confl ict of interest in relation to any transaction, which is considered by the Board, and make appropriate declaration when they have an interest in such transaction. UNITED MALAYAN LAND BHD (4131-M) 57
Corporate Governance Statement
Trading and Insider Information All directors are prohibited from trading in securities and any other property of the Company based on price sensitive information and knowledge which have not been publicly announced. Quarterly reminders are disseminated to all directors on restrictions in trading in the Company’s securities within the “closed periods” as stipulated under the Main Market Listing Requirements of Bursa Securities.
Directors’ Indemnity UMLand has in place a Liabilities Insurance Policy for directors and offi cers in respect of liabilities arising from holding offi ce as its directors and key offi cers. They contribute payment towards the annual premium of this policy.
Related Party Transactions All directors recognize that they must declare their respective interest in related party transactions and abstain from deliberation and voting in respect thereof at Board and general meetings to consider the matter.
Board Committees The Board has delegated specifi c responsibilities to the following Board Committees within their terms of reference in compliance with the Code. With the exception of the Executive Committee to which the Board has granted discretionary authority to deliberate and decide certain operational matters, the ultimate responsibility for fi nal decision on all matters lies with the entire Board.
The following Board Committees were established by the Board with clearly defi ned terms of references:
Audit Committee
Executive Committee
Tender Board Committee
BOARD OF DIRECTORS Board Committees Remuneration Committee
Nomination Committee
Risk Committee
Option Committee 58 UNITED MALAYAN LAND BHD (4131-M)
Corporate Governance Statement
Audit Committee The Audit Committee comprises four (4) members of whom three (3) are independent non-executive directors. The Committee has been established to assist the Board in execution of its responsibilities. The Audit Committee meets periodically to carry out its functions and duties pursuant to its terms of reference and shall have unrestricted access to both the internal and external auditors and members of management of the Group. The activities carried out by the Committee during the fi nancial year under review are summarized in the Audit Committee Report stated in the ensuing pages of this Annual Report 2009.
Executive Committee The Executive Committee (EXCO) comprises four (4) members, majority of whom are non-executive directors. The role of the EXCO is to assist the Board in reviewing major operational and fi nancial issues, monitoring progress and performance of business units in addition to ensuring the achievement of the Group’s strategic goals and objectives.
The functions of the EXCO include but are not limited to:- • evaluation of the Group’s strategic plans; • recommending all major investments and business deals to the Board; • advising management on the overall policies and practices of the Company and the Group; • reviewing the performance evaluation and reward system to be used as a basis of measurement of management and staff effectiveness; • monitoring the development and implementation of an investor relations programme; and • such other functions as may be delegated by the Board from time to time.
Tender Board Committee Tender Board Committee consists of three (3) members, majority of whom are non-executive directors. The committee is tasked by the Board to oversee the Group’s tender and contract procurement processes in compliance with the Group’s relevant policies and requirements. In addition, the committee also considers, evaluates and approves tender awards which are within its fi nancial authority limit, taking into consideration various factors such as price, usage of products and services and other relevant factors.
Remuneration Committee There are three (3) members in the Remuneration Committee majority of whom are independent non-executive directors. The role of the committee is to recommend a remuneration framework for all executive directors by ensuring that the remuneration framework recommended refl ects the Group’s performance. Additionally, the committee also reviews and approves annual salaries, incentive arrangements, service agreements and employment conditions for executive directors and key management as well as performing regular review of the competitiveness of the Group’s remuneration structure and policy.
Nomination Committee The Nomination Committee consists of three (3) members, majority of whom are independent non-executive directors. The committee is primarily responsible for identifying and making recommendations for any appointment to the Board and Board Committees. The committee also evaluates the effectiveness of the Board and review the required mix of skills, experiences and qualifi cations of all directorships in determining the appropriate board balance and size in pacticular the non-executive participation.
Risk Committee The Risk Committee comprises three (3) members, majority of whom are non-executive directors. The committee assists the Board to actively focus and deliberate on all risk oversight responsibilities of the Group. The committee reports to the Board and is tasked with maintaining an effective risk management system which will contribute towards the achievement of the Group’s strategic, fi nancial, operational and other business objectives. Ultimately, the Board is responsible for the overall responsibility for risk oversight within the Group. UNITED MALAYAN LAND BHD (4131-M) 59
Corporate Governance Statement
Option Committee The Option Committee comprises three (3) members. The committee was established to administer the Group’s Employees’ Share Option Scheme (the Scheme) in accordance with the By-Laws approved by the shareholders of the Company and amendments that may be imposed by Bursa Securities in relation to the Scheme from time to time.
INVESTOR RELATIONS AND SHAREHOLDER COMMUNICATION The key elements of good corporate governance are transparency and accountability to all stakeholders which involves communication of clear and relevant information. As such, the Company supports the Code’s principle to encourage shareholders and investors participation and is committed to regular and proactive communication with shareholders and investors.
The Board recognizes the importance of regular and timely dissemination of information to shareholders and investors via its annual report, circulars, quarterly fi nancial reports, newsletters, press releases and corporate announcements made to Bursa Securities during the year. Established procedures are also in place to ensure that material information is released in an accurate and timely manner.
On a periodic basis, Management engages with analysts and fund managers to provide updates on the Group’s fi nancial results, corporate and business developments, regulatory issues as well as changes in operating environment which may impact the Group’s operations. In addition, Management participates in investment road-shows facilitated by research houses whereby fund managers and analysts are briefed and updated on the business operations, fi nancial performance and corporate developments of the Group via one-on-one meetings, group presentations and question-and-answer sessions.
Management actively participates in investor relations programmes initiated and supported by Bursa Securities and Malaysian Investor Relations Association. Its participation in such activities is aimed at enhancing the Company’s overall investor relations function and achieving adequate profi ling through specifi c online distribution channels in order to reach out to the investment community. Through its investor relations portal service provider, the Group has also increased its outreach to investors by featuring the Company on certain fi nancial and share trading portals.
Shareholders also have the opportunity to communicate their views and engage with the Board and the Senior Management at the AGM. Every opportunity is given to the shareholders to seek clarifi cation from the Board members and the Senior Management on all issues relevant to the Group at the AGM.
Shareholders and investors can also access the Group’s Investor Relations website at www.umland.com.my/ir which has been designed to be an alternative source of information to the investing community seeking timely access of information on the Group. The website which has been recently enhanced for a more user-friendly outlook features pertinent business and corporate information, fi nancial and stock information, corporate announcements as well as current developments of the Group. Shareholders who wish to keep abreast of the Group’s updates may do so through the subscription of email alerts on the website and communication with the Group’s Investor Relations Unit via email at [email protected]. 60 UNITED MALAYAN LAND BHD (4131-M)
Corporate Governance Statement
ACCOUNTABILITY AND AUDIT Financial Reporting The Board aims to provide and present a balanced assessment of the Group’s fi nancial performance and prospects by ensuring that fi nancial statements are prepared in accordance with the provisions of the Act and applicable approved accounting standards issued by the Malaysian Accounting Standards Board. The Board is assisted by the Audit Committee to oversee the Group’s fi nancial reporting processes and the quality of its fi nancial reporting.
Directors’ responsibility statement in respect of the preparation of the annual fi nancial statements The Board is responsible for ensuring that the fi nancial statements gives a true and fair view of the state of affairs of the Group as at the end of the fi nancial year and of the results and cashfl ow for the fi nancial year then ended.
In preparing the fi nancial statements, the directors have ensured that relevant accounting policies were applied consistently and made judgements and estimates that are reasonable and prudent. The directors have also ensured that all applicable accounting standards have been followed and fi nancial statements were prepared on the going concern basis as the directors have a reasonable expectation, having made enquiries that the Company and Group have adequate resources to continue in operational existence for the foreseeable future.
The directors also have responsibility for ensuring that the Company keeps accounting records which disclose with reasonable accuracy the fi nancial position of the Company and of the Group which enable them to ensure that the fi nancial statements comply with the provisions of the Act.
The Directors have overall responsibilities for taking such steps as are reasonably open to them to safeguard the assets of the Group to prevent and detect fraud and other irregularities.
Internal Controls The Board acknowledged its overall responsibility for maintaining a sound system of internal controls not only fi nancial controls but also operational and compliance controls as well as risk management.
The Statement on Internal Control set out on the ensuring pages of this Annual Report 2009 provides an overview of the state of internal control within the Group.
Relationship With The Auditors The Board, through the Audit Committee maintains an active, transparent and professional relationship with the Company’s Auditors, both external and internal, particularly in seeking their professional advice towards ensuring compliance with the accounting standards in Malaysia. A full report of the Audit Committee enumerating its role in relation to the internal and external auditors is set out on the ensuing pages of this Annual Report 2009.
This statement is made in accordance with a Board resolution dated 19 April 2010.
TUN MUSA HITAM DATO’ NG ENG TEE Chairman Deputy Chairman/Executive Director UNITED MALAYAN LAND BHD (4131-M) 61
Statement on Internal Control
INTRODUCTION ENTERPRISE RISK MANAGEMENT FRAMEWORK Paragraph 15.26(b) of the Main Market Listing Requirements of Bursa The Board fully supports the contents of the Internal Control Guidance Malaysia Securities Berhad (Bursa Securities) requires the board of and through the Risk Committee, continually reviews the adequacy directors of public listed companies to include in its annual report a and effectiveness of the risk management processes in place within the “statement about the state of internal control of the listed issuer as a various business units of the Group. As such, the Board has formalised group”. The Board of Directors (Board) is committed to maintaining the process for identifying, evaluating and managing signifi cant risks a sound system of internal control within the Group and is pleased faced by the Group through the establishment of an enterprise risk to provide the following statement, which outlines the nature and management framework. The risk rating for individual risk identifi ed scope of internal control of the Group during the fi nancial year ended is determined by mapping the fi nancial and non-fi nancial impact 31 December 2009. against the likelihood of the risk occurring, in the risk matrix after taking into consideration of the effectiveness of existing controls.
BOARD’S RESPONSIBILITY Management is responsible for the management of risk, for developing, The Board affi rms its overall responsibility for the Group’s system of operating and monitoring the system of internal control and for internal controls which includes the establishment of an appropriate providing assurance to the Board that it has done so in accordance control environment and framework as well as reviewing its adequacy with the policies adopted by the Board. Further independent assurance and integrity. Because of the limitations that are inherent in any system is provided by the outsourced internal audit function, which performs of internal controls, it can only provide reasonable, and not absolute its internal audit work on the Group’s operations in accordance with assurance against material misstatement or loss, as it is designed to an internal audit plan annually approved. manage rather than eliminate the risk of failure to achieve business objectives of the Group. The system of internal controls covers, inter The Board believes that maintaining a sound system of internal alia, risk management procedures and fi nancial, operational and controls is premised on a clear understanding and appreciation of the compliance controls. following key elements of the Group’s enterprise risk management framework: The Board has established an ongoing process for identifying, • A risk policies and procedures manual is in place and it outlines evaluating and managing signifi cant risks faced by the Group. This mainly the risk management strategies and policies, risk process includes updating the system of internal controls when there communication structure and monitoring of the Group’s risk are changes to business environment and regulatory guidelines. It has management framework. This document is subject to review been regularly reviewed by the Board and accords with the Statement and improvement from time to time in order to enhance risk on Internal Control: Guidance for Directors of Public Listed Companies management processes. (Internal Control Guidance) issued by the Taskforce on Internal Control with the support and endorsement of Bursa Securities. • The establishment of a Risk Committee enables the main Board to perform a more active and meaningful oversight role of risk The Board is of the view that the system of internal controls in place management within the Group. for the year under review and up to the date of approval of the annual report and fi nancial statements is sound and suffi cient to safeguard • A Risk Management Committee, headed by the Group Chief the shareholders’ investment and the Group’s assets. Executive Offi cer, is placed with the responsibility to identify and communicate to the Risk Committee the present and potential Whilst the Board maintains ultimate responsibility over risk and critical risks the Group faces, their changes and management’s control issues, it has delegated to the executive management the action plans to manage these risks. implementation of the system of risk management and internal control. The Board has established key policies and has carried out • Risk Management Units, established at the business unit level and a specifi c assessment of the Group’s risk management and internal headed by the Head of Subsidiary, on an ongoing basis, identify control systems. present and potential critical risks encountered, formulate action plans with implementation timescales to address key risks and control issues in line with their risk profi les and communicate them to the Risk Management Committee. 62 UNITED MALAYAN LAND BHD (4131-M)
Statement on Internal Control
• The appointment of the Group Risk Coordinator at the Group KEY ELEMENTS OF THE SYSTEM OF INTERNAL level as well as Risk Coordinators at business unit level ensures CONTROL that there is clear leadership, direction and coordination of the group-wide application of risk management. The current system of internal control in the Group has within it, the following key elements: • The risk profi les of the respective business units are assessed • Clearly defi ned delegation of responsibilities to committees of at regular intervals in line with the Group’s risk monitoring and the Board and to Management including organization structures reporting framework and these are communicated to the Risk and appropriate authority levels. Committee. In addition, the monitoring framework also involves discussions on risk environment, effectiveness of controls and • A fi ve-year strategic plan outlining strategies towards review on implementation status of action plans to address the achievement of corporate and business objectives of the Group, risks identifi ed. which provides a basis for monitoring the Group’s fi nancial and business operations performance. The Board considers that the enterprise risk management framework is robust, but will still subject the framework to continuous improvement, • Established fi nancial limits of authority, which have been taking into consideration best risk management practices and the approved by the Executive Committee (EXCO) of the Board, changing business environment. are in place to ensure proper accountability and delegation of authority. INTERNAL AUDIT FUNCTION The internal audit function of the Group is outsourced to independent • A budgetary control system is in place whereby the Group’s external consultants who report directly to the Audit Committee. annual budget is prepared and approved by the Board. Review The internal audit’s role is to provide independent assurance to the of actual performance against budget is regularly carried out Audit Committee and the Board on the adequacy and integrity of to monitor the level of achievement of the Group and material the existing system of internal controls, including the Enterprise Risk variances are reported to the Board. Appropriate remedial and Management processes. corrective actions are taken by management to minimise the adverse effect of such variances, where necessary. Internal audit evaluates the internal controls within the key activities of the Group’s businesses on the basis of an annual internal audit plan • Monthly Management Meetings, involving key management presented to the Audit Committee for approval. The internal audit members within the Group, are held to review, identify, discuss function adopts a risk-based approach and prepares its internal audit and resolve strategic, operational, fi nancial and other key issues strategy and plan based on the risk profi les of the major business affecting the Group. units of the Group. In addition, the annual internal audit plan covers other areas of importance following discussions with management, • Standard operating procedures in respect of certain operational thereby augmenting the risk-based approach in selecting areas for areas have been established to regulate the day-to-day operations internal audit coverage. within the Group. Such standard operating procedures are subject to regular review and improvement to address changes The internal audit reports, including management’s action plans in the business operating environment. to improve the internal control system, are reviewed by the Audit Committee. The fi ndings in the internal audit reports are • Standardised fi nancial practices have been put in place to ensure communicated by the Audit Committee to the Board based on the uniformed fi nancial policies and accounting treatment, practices frequency of internal audit cycles set out in the internal audit plan. and procedures within the Group. The fi nancial practices Management follows up on the recommendations and implements are documented in a Group Financial Policies Manual, which action plans to address key improvement areas as highlighted in the was approved by the EXCO. The manual is subject to regular internal audit reports. review and updates to address changes in fi nancial reporting requirements. For further details, please refer to the Audit Committee Report. UNITED MALAYAN LAND BHD (4131-M) 63
Statement on Internal Control
• The Cost Management & Control Department has put in place cost planning and control measures including standard operating procedures in respect of contracts and projects of the Group. This provides the Board assurance on the adequacy and effectiveness of the project operating procedures and its control environment.
• Key internal audit fi ndings highlighted in the internal audit reports are followed up at Risk Management Unit meetings in order to monitor the implementation of remedial action plans.
WEAKNESSES IN INTERNAL CONTROLS THAT RESULT IN MATERIAL LOSSES The system of internal controls is satisfactory and there were no material losses incurred during the current fi nancial year as a result of weaknesses in internal control. Management continues to take measures to strengthen the control environment.
REVIEW OF THE STATEMENT ON INTERNAL CONTROL BY EXTERNAL AUDITOR As required by paragraph 15.23 of the Main Market Listing Requirements of Bursa Securities, the external auditors have reviewed this Statement on Internal Control. Their review was performed in accordance with Recommended Practice Guide (RPG) 5 issued by the Malaysian Institute of Accountants. Based on their review, the external auditors have reported to the Board that nothing has come to their attention that causes them to believe that this Statement is inconsistent with their understanding of the process the Board has adopted in the review of the adequacy and integrity of internal control of the Group. RPG 5 does not require the external auditors to and they did not consider whether this Statement covers all risks and controls, or to form an opinion on the effectiveness of the Group’s risk and control procedures.
This statement is made in accordance with the resolution of the Board dated 19 April 2010. 64 UNITED MALAYAN LAND BHD (4131-M)
Audit Committee Report
FORMATION The meetings were also attended by the senior management of The Audit Committee (Committee) was established by the Board the Group and the Group’s internal and external auditors upon in 1995 to assist the Board in fulfi lling its fi duciary responsibilities invitation by the Chairman of the Committee to provide input during relating to internal controls, fi nancial and accounting policies as well deliberations on issues raised. as fi nancial reporting practices of the Company and its subsidiaries (the Group). The Committee is governed by its Terms of Reference. SUMMARY OF ACTIVITIES DURING THE YEAR The Committee performed, inter-alia, the following activities during MEMBERSHIP the fi nancial year in the discharge of their duties and responsibilities For the fi nancial year ended 31 December 2009, the Committee in accordance with its Terms of Reference:- comprised four (4) members of whom three (3) are independent • Reviewed and recommended the quarterly and year end fi nancial non-executive Directors. Members of the Committee and those who results, external audit plans and related fees for the Group to had served during the year are as follows:- the Board for approval; i) Datuk Syed Ahmad Khalid bin Syed Mohammed Chairman/Independent Non-Executive Director • Reviewed fi ndings of audit examination conducted by the external auditors during the fi nancial year; ii) Datuk Nur Jazlan bin Tan Sri Mohamed Member/Independent Non-Executive Director • Reviewed recurrent related party transactions of the Group covered by the shareholders’ mandate and where relevant, iii) Chan Say Yeong additional related party transactions and their appropriate Member/Non-Independent Non-Executive Director disclosure requirements;
iv) Pakhruddin bin Sulaiman • Reviewed and approved internal audit plan for Cycles 14 and 15 Member/Independent Non-Executive Director including related fees for the Group; and (Appointed on 24 February 2009) • Reviewed internal audit recommendation arising from internal audit reviews in the respective cycles and management’s action MEETINGS AND ATTENDANCE plans to address the key improvement areas based on their The Committee meets on a scheduled basis, at least four (4) times a implementation priority. year with additional meetings convened as and when required. During the fi nancial year ended 31 December 2009, the Committee held a INTERNAL AUDIT FUNCTION total of eight (8) meetings. Details of attendance by the members are set out below:- The internal audit in respect of fi nancial year 2009 covered the Company, Seri Alam Properties Sdn Bhd, Bangi Heights Development Attendance Sdn Bhd, Dynasty View Sdn Bhd and UM Development Sdn Bhd Datuk Syed Ahmad Khalid bin Syed Mohammed 8/8 with the overall scope and emphasis areas concentrated on high and Datuk Nur Jazlan bin Tan Sri Mohamed 4/8 signifi cant risk areas. The internal audit also covered key priority areas Chan Say Yeong 6/8 identifi ed in consultation with management, which complemented Pakhruddin bin Sulaiman 6/6 the risk-based audit approach and involved the key business and strategic management processes of the Group. UNITED MALAYAN LAND BHD (4131-M) 65
Audit Committee Report
The Audit Committee assessed the annual audit plan to ensure The Secretary to the Committee shall be the Company Secretary or adequate scope and comprehensive coverage over the key risk areas Assistant Company Secretary or any other person appointed by the of the Group. The Audit Committee reviewed the internal audit Committee. The Secretary will be responsible for keeping the minutes reports, considered the major fi ndings and recommendation arising of meetings of the Committee and circulating them to Committee from internal audit in key areas with improvement opportunities as members and other members of the Board. well as management’s proposed remedial action plans and monitored the corrective actions on the outstanding audit issues to ensure that AUTHORITY key risks and control lapses have been addressed. The internal audit function which was outsourced to independent external consultants The Committee is authorised by the Board to investigate any activities carried out follow-up reviews on these highlighted observations and within its terms of reference and shall have unrestricted access to action plans in their subsequent review cycles. Internal audit costs both the internal and external auditors and members of management incurred for the fi nancial year ended 31 December 2009 amounted of the Group. The Committee is also authorised by the Board to to RM123,912.40. obtain independent professional advice and to secure the attendance of outsiders with relevant experience and expertise if it considers this necessary in the performance of their duties. TERMS OF REFERENCE
COMPOSITION DUTIES The Committee shall be appointed by the Board from amongst The duties of the Committee shall be:- their number and shall consist of not less than 3 members, all of • To consider the appointment of the external and internal whom must be non-executive directors with a majority, including the auditors, the audit fee and any questions of resignation and Chairman, being independent directors of the Company. No alternate dismissal; director shall be appointed as a member of the Committee. • To discuss with the external auditors:
The Committee shall include at least one (1) person:- - The audit plan; - Their evaluation of the system of internal controls; a) who is a member of the Malaysian Institute of Accountants; or - The audit report on the fi nancial statements b) who has at least 3 years’ working experience and:- • To ensure co-ordination of the external audit process where i) has passed the examinations specifi ed in Part I of the 1st more than one audit fi rm is involved; Schedule of the Accountants Act 1967; or • To review the assistance given by employees of the Group to the ii) is a member of one of the associations of accountants external and internal auditors; specifi ed in Part II of the 1st Schedule of the Accountants Act, 1967. • To review the quarterly and year-end fi nancial statements of the Company, focusing particularly on: The terms of offi ce and performance of the Committee shall be - Changes in accounting policies and practices; reviewed by the Board no less than once in every 3 years. - Signifi cant and unusual events; - Signifi cant adjustments arising from the audit; - The going concern assumption; MEETINGS - Compliance with accounting standards and other legal Meetings shall be held no less than four times a year. A quorum shall requirements; be formed when majority of the Committee members are independent • To discuss fi ndings and matters arising from the interim and directors. The Committee may convene meetings with the external fi nal audits, and any matters the auditors may wish to discuss; auditors, the internal auditors or both, including the attendance of other directors and employees, whenever deemed necessary. • To review the internal and external auditors’ management letter The attendance of employees, other directors, representatives of and management’s response; the internal and external auditors at such meetings will be at the Committee’s invitation. 66 UNITED MALAYAN LAND BHD (4131-M)
Audit Committee Report
• To do the following in relation to an internal audit function: - Review the adequacy of the scope, functions, competency and resources of the internal audit function, and that it has the necessary authority to carry out its work; - Review the internal audit programme and results of the internal audit process and where necessary, ensure that appropriate action is taken on the recommendations of the internal audit function; - Review any appraisal or assessment of the performance of members of the internal audit function; • To review any related party transactions and confl ict of interest situation that may arise within the Company or the Group; • To verify the allocation of share options granted to the Group’s eligible employees and directors in accordance with the By-Laws and Internal Guidelines governing the Employees’ Share Option Scheme at the end of each fi nancial year; • To consider the major fi ndings of internal and special investigations and management’s response; and • To consider other matters as defi ned by the Board. UNITED MALAYAN LAND BHD (4131-M) 67
Additional Compliance Information
1. SHARE BUY BACK At the 48th Annual General Meeting (AGM) held on 24 June 2009, the Company had obtained its shareholders’ mandate to allow the Company to buy back its own shares. During the fi nancial year, the Company did not buy back any of its own shares.
The Company had, during the implementation of a previous share buy back scheme, purchased 401,800 of its own shares at a total purchase consideration, including incidental cost, of RM463,068 or at an average gross price of RM1.15 per share. These shares are now being held as treasury shares. None of the shares bought back has been resold in the market.
The Company proposes to renew the mandate from its shareholders to buy back its own shares at its forthcoming 49th AGM. The details of the proposed share buy-back are disclosed in the accompanying Share Buy-Back Statement.
2. MATERIAL CONTRACTS Save as disclosed below, there are no material contracts of the Company and/or its subsidiaries, involving directors’ and major shareholders’ interest, either still subsisting at the end of the fi nancial year or, if not then subsisting, entered into since the end of the previous fi nancial year: (i) Joint venture agreement dated 7 March 2003 between UM Residences Sdn Bhd (UMR), a wholly-owned subsidiary of the Company, and Liang Court (Malaysia) Sdn Bhd (LCSB), a subsidiary of CapitaLand Limited which in turn is a major shareholder of the Company, for the purpose of establishing a joint venture partnership for the operation of Somerset Seri Bukit Ceylon Serviced Residences (SSBCSR) (JV Partnership).
UMR and the JV Partnership entered into the following agreements in relation to the JV Partnership: a) On 7 March 2003, management agreement between the JV Partnership and Ascott International Management (Malaysia) Sdn Bhd (AIM), a subsidiary of CapitaLand Limited, for purposes of engagement and appointment of AIM to operate, maintain, manage and market the SSBCSR for and on behalf of the JV Partnership;
b) On 31 July 2006, shareholders’ agreement between UMR and LCSB to form a new joint venture company (JV Company) and regulate and govern material aspects and conduct of the business of the JV Company. The JV Company will undertake the operations of SSBCSR originally envisaged under the JV Partnership;
c) On 8 October 2007, novation agreement between the JV Partnership, AIM and SSBC Sdn Bhd (SSBC) to novate all rights and obligations attached with the JV Partnership under the management agreement dated 7 March 2003 to SSBC, a 50.533% owned subsidiary of UMR;
d) On 8 October 2007, tenancy agreement between UMR and SSBC for SSBC to manage, operate and market for rental 48 units of SSBCSR together with 24 vehicle parking bays. The tenancy agreement is for a duration of three years from 1 July 2007 to 30 June 2010 with an automatic renewal of a further six months expiring on 31 December 2010 at a basic rental of RM235,000.00 per quarter; 68 UNITED MALAYAN LAND BHD (4131-M)
Additional Compliance Information
e) On 8 October 2007, tenancy agreement between LCSB and SSBC for SSBC to manage, operate and market for rental 48 units of SSBCSR together with 24 vehicle parking bays. The tenancy agreement is for a duration of three years from 1 July 2007 to 30 June 2010 with an automatic renewal of a further six months expiring on 31 December 2010 at a basic rental of RM230,000.00 per quarter;
f) On 8 October 2007, two separate tenancy agreements between UMR and SSBC for the rental of one part of the ground fl oor at the rate of RM1,782.00 per month and another part of the ground fl oor containing the lobby, maintenance offi ce and back of house of SSBCSR at the rate of RM1.00 per annum. The tenancy agreements are for a duration of three years from 1 July 2007 to 30 June 2010 with an automatic renewal of a further six months expiring on 31 December 2010
(ii) Joint venture and shareholders agreement dated 28 April 2004 between the Company and Malaysian Resources Corporation Berhad to govern a joint venture company, namely Suasana Sentral Two Sdn Bhd, for the development of the Suasana Sentral Loft condominium project in Kuala Lumpur Sentral. CapitaLand Limited, a major shareholder of the Company, has a subsisting joint venture arrangement with Malaysian Resources Corporation Berhad through OneSentral Park Sdn Bhd in which CapitaLand Limited and Malaysian Resources Corporation Berhad have indirect equity interest of 49.00% and direct equity interest of 51.00% respectively. The Suasana Sentral Loft condominium project was completed in 2007.
3. NON-AUDIT FEES Non-audit fees paid to external auditors for the fi nancial year ended 31 December 2009 amounted to RM23,000.
UNITED MALAYAN LAND BHD (4131-M) 69
Additional Compliance Information
4. RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE At the 48th AGM held on 24 June 2009, the Company had obtained its shareholders’ mandate to allow the Company and/or its subsidiaries to enter into recurrent related party transactions of a revenue or trading nature. Pursuant to Paragraph 10.09(2)(b) of Bursa Malaysia Securities Berhad (Bursa Securities) Main Market Listing Requirements, the details of the recurrent related party transactions conducted during the current fi nancial year are disclosed as follows:
Mandated Related Parties Nature of Transactions Value Interested Parties RM
Ascott International Procurement of technical consultancy (768,264) Interested major shareholders Management (Malaysia) and management services • Opal Holdings Pte Ltd Sdn Bhd • CapitaLand Residential Malaysia Pte Ltd • CapitaLand Commercial Limited • CapitaLand Limited • Temasek Holdings (Private) Limited
Interested directors • Chan Say Yeong • Hazel Chew Siew Cheng • Lim Wie Shan
Bangi Heights Provision of management services 1,920,000 Interested major shareholders Development Sdn Bhd • Opal Holdings Pte Ltd • CapitaLand Residential Malaysia Pte Ltd • CapitaLand Commercial Limited • CapitaLand Limited • Temasek Holdings (Private) Limited
Interested directors • Chan Say Yeong • Hazel Chew Siew Cheng • Lim Wie Shan
Exquisite Skyline Sdn Bhd Provision of project management services 445,332 Interested director Provision of management services 600,000 • Syed Azmin Bin Mohd Nursin @ Syed Nor 70 UNITED MALAYAN LAND BHD (4131-M)
Additional Compliance Information
Mandated Related Parties Nature of Transactions Value Interested Parties RM
Suasana Sentral Two Provision of management services 300,000 Interested major shareholders Sdn Bhd • Opal Holdings Pte Ltd • CapitaLand Residential Malaysia Pte Ltd • CapitaLand Commercial Limited • CapitaLand Limited • Temasek Holdings (Private) Limited
Interested directors • Chan Say Yeong • Hazel Chew Siew Cheng • Lim Wie Shan
Persons connected to major shareholder • Malaysian Resources Corporation Berhad
Tradewinds Properties Rental of offi ce premises, parking, (869,507) Interested director Sdn Bhd maintenance and other services • Syed Azmin Bin Mohd Nursin @ Syed Nor
Tradewinds International Procurement of insurance services (134,228) Interested director Insurance Brokers Sdn Bhd • Syed Azmin Bin Mohd Nursin @ Syed Nor
SSBC Sdn Bhd Rental income of serviced residences 1,206,914 Interested major shareholders • Opal Holdings Pte Ltd • CapitaLand Residential Malaysia Pte Ltd • CapitaLand Commercial Limited • CapitaLand Limited • Temasek Holdings (Private) Limited
Interested directors • Chan Say Yeong • Hazel Chew Siew Cheng • Lim Wie Shan UNITED MALAYAN LAND BHD (4131-M) 71
Additional Compliance Information
Mandated Related Parties Nature of Transactions Value Interested Parties RM
Liang Court (Malaysia) Rental expense for serviced residences (1,192,107) Interested major shareholders Sdn Bhd • Opal Holdings Pte Ltd • CapitaLand Residential Malaysia Pte Ltd • CapitaLand Commercial Limited • CapitaLand Limited • Temasek Holdings (Private) Limited
Interested directors • Chan Say Yeong • Hazel Chew Siew Cheng • Lim Wie Shan
72 UNITED MALAYAN LAND BHD (4131-M)
Additional Compliance Information
5. FINANCIAL ASSISTANCE At the 48th AGM held on 24 June 2009, the Company had obtained its shareholders’ mandate for provision/procurement of fi nancial assistance. The fi nancial assistance comprises the pooling of funds via centralized treasury management for a duration not exceeding three years. Pursuant to Paragraph 10.09(2)(b) of Bursa Securities Main Market Listing Requirements, the details of fi nancial assistance provided/ procured during the current fi nancial year are disclosed as follows:
Balance as at Financial Assistance 31 December 2009 Interested parties Provided by Provided to RM
UMLand and/or its subsidiaries Alpine Return Sdn Bhd 10,978,410 Not applicable
UMLand and/or its subsidiaries Bangi Heights Nil Interested major shareholders Development Sdn Bhd • Opal Holdings Pte Ltd • CapitaLand Residential Malaysia Pte Ltd • CapitaLand Commercial Limited • CapitaLand Limited • Temasek Holdings (Private) Limited
Interested directors • Chan Say Yeong • Hazel Chew Siew Cheng • Lim Wie Shan
Bangi Heights UMLand and/or its subsidiaries 35,847,737 Interested major shareholders Development Sdn Bhd • Opal Holdings Pte Ltd • CapitaLand Residential Malaysia Pte Ltd • CapitaLand Commercial Limited • CapitaLand Limited • Temasek Holdings (Private) Limited
Interested directors • Chan Say Yeong • Hazel Chew Siew Cheng • Lim Wie Shan UNITED MALAYAN LAND BHD (4131-M) 73
Additional Compliance Information
Balance as at Financial Assistance 31 December 2009 Interested parties Provided by Provided to RM
UMLand and/or its subsidiaries Suasana Sentral Two Sdn Bhd 221,233 Interested major shareholders • Opal Holdings Pte Ltd • CapitaLand Residential Malaysia Pte Ltd • CapitaLand Commercial Limited • CapitaLand Limited • Temasek Holdings (Private) Limited
Interested directors • Chan Say Yeong • Hazel Chew Siew Cheng • Lim Wie Shan
Persons connected to major shareholder • Malaysian Resources Corporation Berhad
UMLand and/or its subsidiaries Exquisite Skyline Sdn Bhd 40,664,016 Interested director • Syed Azmin Bin Mohd Nursin @ Syed Nor
UMLand and/or its subsidiaries SSBC Sdn Bhd 369,152 Interested major shareholders • Opal Holdings Pte Ltd • CapitaLand Residential Malaysia Pte Ltd • CapitaLand Commercial Limited • CapitaLand Limited • Temasek Holdings (Private) Limited
Interested directors • Chan Say Yeong • Hazel Chew Siew Cheng • Lim Wie Shan
SSBC Sdn Bhd UMLand and/or its subsidiaries Nil Interested major shareholders • Opal Holdings Pte Ltd • CapitaLand Residential Malaysia Pte Ltd • CapitaLand Commercial Limited • CapitaLand Limited • Temasek Holdings (Private) Limited
Interested directors • Chan Say Yeong • Hazel Chew Siew Cheng • Lim Wie Shan 74 UNITED MALAYAN LAND BHD (4131-M)
Additional Compliance Information
Balance as at Financial Assistance 31 December 2009 Interested parties Provided by Provided to RM
UMLand and/or its subsidiaries Nusajaya Consolidated 815,941 Not applicable Sdn Bhd
UMLand and/or its subsidiaries Extreme Consolidated 1,060,853 Interested director Sdn Bhd • Syed Azmin Bin Mohd Nursin @ Syed Nor UNITED MALAYAN LAND BHD (4131-M) 75
Financial Statements
Directors’ Report 76 Statement by Directors 80 Statutory Declaration 80
Independent Auditors’ Report 81 Income Statements 82 Balance Sheets 83
Consolidated Statement of Changes in Equity 85
Company Statement of Changes in Equity 87 Cash Flow Statements 88
Notes to the Financial Statements 90 76 UNITED MALAYAN LAND BHD (4131-M)
Directors’ Report FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
The Directors hereby submit to the members their annual report and the audited fi nancial statements of the Group and Company for the fi nancial year ended 31 December 2009.
PRINCIPAL ACTIVITIES The principal activities of the Company are investment holding and the provision of management services.
The principal activity of the subsidiary companies is property development. Other activities include property investment and investment holding.
There were no signifi cant changes in the nature of these activities during the fi nancial year.
FINANCIAL RESULTS The fi nancial results of the Group and Company for the fi nancial year ended 31 December 2009 are as follows:
Group Company RM’000 RM’000
Profi t for the fi nancial year 57,468 47,898
Attributable to: Equity holders of the Company 55,035 47,898 Minority interests 2,433 – 57,468 47,898
DIVIDENDS The dividends paid by the Company since 31 December 2008 were as follows:
RM’000 In respect of the fi nancial year ended 31 December 2008: – fi nal dividend of 2.50 sen gross per ordinary share, less income tax of 25%, paid on 18 September 2009 4,525
In respect of the fi nancial year ended 31 December 2009: – interim dividend of 2.50 sen gross per ordinary share, less income tax of 25%, paid on 22 June 2009 4,524
– interim dividend of 2.50 sen gross per ordinary share, less income tax of 25%, paid on 10 February 2010 4,525 13,574
The Directors now recommend the payment of a fi nal dividend of 4.06 sen gross per ordinary share, less income tax of 25% and 0.70 sen gross per ordinary share, tax-exempt, on 241,303,433 ordinary shares (which is net of 401,800 treasury shares), in respect of the fi nancial year ended 31 December 2009. This fi nal net dividend amounting to RM9,036,814 is subject to the approval of the members at the forthcoming Annual General Meeting of the Company. UNITED MALAYAN LAND BHD (4131-M) 77
Directors’ Report
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
RESERVES AND PROVISIONS All material transfers to or from reserves and provisions during the fi nancial year are as disclosed in the fi nancial statements.
TREASURY SHARES Details of the treasury shares are as set out in Note 25 to the fi nancial statements.
DIRECTORS The Directors who have held offi ce during the period since the date of the last report are as follows:
Alternate Director
YABhg Tun Musa Hitam Dato’ Ng Eng Tee Datuk Syed Ahmad Khalid bin Syed Mohammed Datuk Nur Jazlan bin Tan Sri Mohamed Chan Say Yeong Lim Wie Shan Hazel Chew Siew Cheng (Appointed on 31 October 2009) Lim Wie Shan (Appointed on 31 October 2009) Ng Eng Soon Syed Azmin bin Mohd Nursin @ Syed Nor Pakhruddin bin Sulaiman Chen Lian Pang (Resigned on 31 October 2009) Lim Wie Shan (Resigned on 31 October 2009)
In accordance with Article 94 of Company’s Articles of Association, Dato’ Ng Eng Tee and Syed Azmin bin Mohd Nursin @ Syed Nor retire by rotation at the forthcoming Annual General Meeting and, being eligible, offer themselves for re-election.
In accordance with Article 99 of Company’s Articles of Association, Hazel Chew Siew Cheng, who was appointed during the period, retires at the forthcoming Annual General Meeting and, being eligible, offers herself for election.
In compliance with Section 129(2) of Companies Act, 1965, YABhg Tun Musa Hitam, being over seventy years of age, retires at the forthcoming Annual General Meeting and offers himself for reappointment as Director in accordance with Section 129(6) of Companies Act, 1965.
DIRECTORS’ BENEFITS During and at the end of the fi nancial year, no arrangements subsisted to which the Company is a party, being arrangements with the object or objects of enabling Directors of the Company to acquire benefi ts by means of the acquisition of shares in, or debentures of, the Company or any other body corporate.
Since the end of the previous fi nancial year, no Director has received or become entitled to receive a benefi t (other than the Directors’ remuneration as disclosed in Note 7 to the fi nancial statements) by reason of a contract made by the Company or a related corporation with the Director or with a fi rm of which he is a member, or with a company in which he has a substantial fi nancial interest except as disclosed in Note 31 to the fi nancial statements. 78 UNITED MALAYAN LAND BHD (4131-M)
Directors’ Report
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES According to the Register of Directors’ Shareholdings, particulars of interests of Directors who held offi ce at the end of the fi nancial year in the shares of the Company are as follows:
Number of ordinary shares of RM1.00 each As at As at 1.1.2009 Acquired Disposed 31.12.2009 ‘000 ‘000 ‘000 ’000
Shareholdings in the name of the Director Dato’ Ng Eng Tee 6,525 – – 6,525 Ng Eng Soon 7,151 – – 7,151 Datuk Syed Ahmad Khalid bin Syed Mohammed 10 – – 10
Shareholdings in which the Director is deemed to have an interest Dato’ Ng Eng Tee 28,607 1,860 (1,500) 28,967 Ng Eng Soon 17,829 – – 17,829
Dato’ Ng Eng Tee and Ng Eng Soon by virtue of their direct and indirect interests in the Company, are deemed to have an interest in the shares of the subsidiary companies to the extent the Company has an interest.
Other than as disclosed above, according to the Register of Directors’ Shareholdings, the Directors in offi ce at the end of the fi nancial year did not hold any interest in shares, options over ordinary shares or debentures in the Company and its related corporations during the fi nancial year.
STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS Before the income statements and balance sheets 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 satisfi ed 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, other than debts, which were unlikely to realise in the ordinary course of business their values as shown in the accounting records of the Group and Company 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 amounts written off for bad debts or the amount of the allowance for doubtful debts in the fi nancial statements of the Group and Company inadequate to any substantial extent; or
(b) which would render the values attributed to current assets in the fi nancial statements of the Group and Company misleading; or
(c) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and Company misleading or inappropriate. UNITED MALAYAN LAND BHD (4131-M) 79
Directors’ Report
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS (CONT’D.) 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 fi nancial year which, in the opinion of the Directors, will or may affect the ability of the Group or Company to meet their obligations when they fall due.
At the date of this report, there does not exist: (a) any charge on the assets of the Group or Company which has arisen since the end of the fi nancial year which secures the liability of any other person; or
(b) any contingent liability of the Group or Company which has arisen since the end of the fi nancial year.
At the date of this report, the Directors are not aware of any circumstances not otherwise dealt with in this report or the fi nancial statements which would render any amount stated in the fi nancial statements misleading.
In the opinion of the Directors: (a) the results of the operations of the Group and Company during the fi nancial year were not substantially affected by any item, transaction or event of a material and unusual nature; and
(b) there has not arisen in the interval between the end of the fi nancial 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 Company for the fi nancial year in which this report is made.
AUDITORS The auditors, PricewaterhouseCoopers, have expressed their willingness to continue in offi ce.
Signed on behalf of the Board of Directors in accordance with their resolution dated 22 April 2010.
DATO’ NG ENG TEE DATUK NUR JAZLAN BIN TAN SRI MOHAMED DIRECTOR DIRECTOR 80 UNITED MALAYAN LAND BHD (4131-M)
Statement by Directors PURSUANT TO SECTION 169(15) OF COMPANIES ACT, 1965
We, Dato’ Ng Eng Tee and Datuk Nur Jazlan bin Tan Sri Mohamed, two of the Directors of United Malayan Land Bhd, state that, in the opinion of the Directors, the fi nancial statements set out on pages 82 to 140 are drawn up so as to give a true and fair view of the state of affairs of the Group and Company as at 31 December 2009 and of the results and cash fl ows of the Group and Company for the fi nancial year ended on that date in accordance with Malaysian Accounting Standards Board (“MASB”) Approved Accounting Standards in Malaysia for Entities Other than Private Entities and the provisions of Companies Act, 1965.
Signed on behalf of the Board of Directors in accordance with their resolution dated 22 April 2010.
DATO’ NG ENG TEE DATUK NUR JAZLAN BIN TAN SRI MOHAMED DIRECTOR DIRECTOR
Kuala Lumpur
Statutory Declaration PURSUANT TO SECTION 169(16) OF COMPANIES ACT, 1965
I, Gan Teong Hock, the Offi cer primarily responsible for the fi nancial management of United Malayan Land Bhd, do solemnly and sincerely declare that the fi nancial statements set out on pages 82 to 140 are, to the best of my knowledge and belief, correct and I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of Statutory Declarations Act, 1960.
GAN TEONG HOCK
Subscribed and solemnly declared by the abovenamed Gan Teong Hock at Kuala Lumpur, Malaysia on 22 April 2010.
Before me,
COMMISSIONER FOR OATHS UNITED MALAYAN LAND BHD (4131-M) 81
Independent Auditors’ Report TO THE MEMBERS OF UNITED MALAYAN LAND BHD
REPORT ON THE FINANCIAL STATEMENTS We have audited the fi nancial statements of United Malayan Land Bhd, which comprise the balance sheets as at 31 December 2009, and the income statements, statement of changes in equity and cash fl ow statements of the Group and Company for the fi nancial year then ended, and a summary of signifi cant accounting policies and other explanatory notes, as set out on pages 82 to 140.
Directors’ Responsibility for the Financial Statements The Directors of the Company are responsible for the preparation and fair presentation of these fi nancial statements in accordance with MASB Approved Accounting Standards in Malaysia for Entities Other than Private Entities and Companies Act, 1965. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of fi nancial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.
Auditors’ Responsibility Our responsibility is to express an opinion on these fi nancial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the fi nancial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fi nancial statements. The procedures selected depend on our judgement, including the assessment of risks of material misstatement of the fi nancial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Group’s preparation and fair presentation of the fi nancial statements 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 internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Directors, as well as evaluating the overall presentation of the fi nancial statements.
We believe that the audit evidence we have obtained is suffi cient and appropriate to provide a basis for our audit opinion.
Opinion In our opinion, the fi nancial statements have been properly drawn up in accordance with MASB Approved Accounting Standards in Malaysia for Entities Other than Private Entities and Companies Act, 1965 so as to give a true and fair view of the fi nancial position of the Group and Company as of 31 December 2009 and of its fi nancial performance and cash fl ows for the fi nancial year then ended.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS In accordance with the requirements of Companies Act, 1965 in Malaysia, we also report that, in our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and by the subsidiary companies have been properly kept in accordance with the provisions of the Act.
OTHER MATTERS This report is made solely to the members of the Company, as a body, in accordance with Section 174 of Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.
PRICEWATERHOUSECOOPERS LEE TUCK HENG (No. AF: 1146) (No. 2092/09/10 (J)) Chartered Accountants Chartered Accountant
Kuala Lumpur 26 April 2010 82 UNITED MALAYAN LAND BHD (4131-M)
Income Statements FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
Group Company Note 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Revenue 5 208,506 172,083 80,095 36,395 Interest income 354 2,905 – – Other operating income 41,638 2,799 – 18 Development costs recognised as expenses (135,929) (117,704) – – Advertising and promotion expenses (3,271) (4,322) (129) (45) Allowance for doubtful debts (1,712) (3,300) – – Depreciation of property, plant and equipment and investment properties (1,483) (1,841) (439) (462) Employee benefi ts expenses 6 (18,009) (21,891) (6,514) (9,288) Impairment loss of other investments (3,099) (1,973) (3,099) (1,973) Management fees (120) (150) – – Professional consultancy fees (5,749) (3,861) (1,153) (610) Rental of premises (1,153) (1,089) (797) (756) Upkeep, repairs and maintenance of assets (3,303) (3,402) (167) (190) Write-back of allowance for doubtful debts 5,134 1,886 – – Other operating expenses (11,427) (9,406) (1,403) (1,841) Finance costs 8 (8,618) (9,842) (4,906) (4,509) Share of results of jointly controlled entities 1,158 (316) – – Profi t before tax 9 62,917 576 61,488 16,739 Tax expense 10 (5,449) (1,843) (13,590) (4,280) Profi t/(loss) for the fi nancial year 57,468 (1,267) 47,898 12,459
Attributable to: Equity holders of the Company 55,035 (3,462) 47,898 12,459 Minority interests 2,433 2,195 – – Profi t/(loss) for the fi nancial year 57,468 (1,267) 47,898 12,459
Earnings/(loss) per share attributable to equity holders of the Company (sen) – basic 11 22.81 (1.43)
– diluted 11 N/A N/A
Dividend per share (sen) 12 9.76 2.50 9.76 2.50 UNITED MALAYAN LAND BHD (4131-M) 83
Balance Sheets AS AT 31 DECEMBER 2009
Group Company Note 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
ASSETS
Non-current assets Property, plant and equipment 13 280,390 328,910 1,432 2,027 Investment properties 14 56,853 17,258 – – Investments in subsidiary companies 15 – – 534,792 451,530 Investments in jointly controlled entities 16 20,502 19,799 20,000 20,000 Other investments 17 – 3,108 – 3,099 Land held for property development 18 194,700 172,974 – – Long term trade receivable 19 862 – – – Deferred tax assets 20 17,652 16,522 143 370 570,959 558,571 556,367 477,026
Current assets Completed properties 21 48,231 86,798 – – Property development costs 22 343,191 392,150 – – Tax recoverable 2,828 2,280 2,772 1,778 Trade and other receivables 23 168,989 107,893 149,274 219,022 Deposits, bank and cash balances 24 62,942 123,747 3,732 1,808 626,181 712,868 155,778 222,608
Total assets 1,197,140 1,271,439 712,145 699,634 84 UNITED MALAYAN LAND BHD (4131-M)
Balance Sheets
AS AT 31 DECEMBER 2009
Group Company Note 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
EQUITY AND LIABILITIES
Capital and reserves attributable to equity holders of the Company Share capital 25 241,705 241,705 241,705 241,705 Reserves 26 616,144 574,683 375,755 341,431 857,849 816,388 617,460 583,136 Minority interests 66,920 84,062 – – Total equity 924,769 900,450 617,460 583,136
Non-current liabilities Deferred tax liabilities 20 10,871 10,828 – – Long term trade payable 27 – 14,000 – – Borrowings 28 81,761 134,668 40,292 60,564 92,632 159,496 40,292 60,564
Current liabilities Trade and other payables 29 58,696 69,683 6,596 5,225 Provision 30 9,715 78 – – Borrowings – bank overdrafts 28 9,550 14,998 – 4,949 – others 28 95,488 124,667 43,272 45,760 Current tax liabilities 1,765 2,067 – – Dividend payable 12 4,525 – 4,525 – 179,739 211,493 54,393 55,934
Total liabilities 272,371 370,989 94,685 116,498
Total equity and liabilities 1,197,140 1,271,439 712,145 699,634
Net assets per share attributable to equity holders of the Company 11 RM3.56 RM3.38 UNITED MALAYAN LAND BHD (4131-M) 85
Consolidated Statement of Changes in Equity FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
Attributable to equity holders of the Company Share Share Revaluation Capital Treasury Retained Revaluation Minority Total Note capital premium reserves reserves shares earnings reserves* Total interests equity RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
As at 1 January 2009 241,705 63,971 243,018 (41,625) (463) 236,681 73,101 816,388 84,062 900,450
Income and expense recognised directly in equity: – realisation of revaluation reserves – – (33,597) – – – 33,597 – – –
Profi t for the fi nancial year – – – – – 55,035 – 55,035 2,433 57,468
Total recognised income and expense for the fi nancial year – – (33,597) – – 55,035 33,597 55,035 2,433 57,468 Final dividend paid for the fi nancial year ended 31 December 2008 12 – – – – – (4,525) – (4,525) (450) (4,975) Interim dividends paid and payable for the fi nancial year ended 31 December 2009 12 – – – – – (9,049) – (9,049) (19,125) (28,174) As at 31 December 2009 241,705 63,971 209,421 (41,625) (463) 278,142 106,698 857,849 66,920 924,769
* This represents the accumulated revaluation reserves which have already been realised. 86 UNITED MALAYAN LAND BHD (4131-M)
Consolidated Statement of Changes in Equity
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
Attributable to equity holders of the Company Share Share Share Revaluation Capital option Treasury Retained Revaluation Minority Total capital premium reserves reserves reserve shares earnings reserves* Total interests equity RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
As at 1 January 2008 241,650 63,950 245,922 (41,625) 667 (463) 252,933 69,797 832,831 86,871 919,702
Income and expense recognised directly in equity: – realisation of revaluation reserves – – (3,304) – – – – 3,304 – – – – revaluation reserves arising from acquisition of a subsidiary company – – 400 – – – – – 400 – 400 Loss for the fi nancial year – – – – – – (3,462) – (3,462) 2,195 (1,267)
Total recognised income and expense for the fi nancial year – – (2,904) – – – (3,462) 3,304 (3,062) 2,195 (867) Employees’ Share Option Scheme: – shares issued 55 21 – – (2) – – – 74 – 74 – options expired – – – – (665) – 665 – – – – Issuance of ordinary shares in a subsidiary company to a minority interest – – – – – – – – – 797 797 Interim dividend paid for the fi nancial year ended 31 December 2007 – – – – – – (63) – (63) – (63) Final dividend paid for the fi nancial year ended 31 December 2007 – – – – – – (13,392) – (13,392) (5,801) (19,193) As at 31 December 2008 241,705 63,971 243,018 (41,625) – (463) 236,681 73,101 816,388 84,062 900,450
* This represents the accumulated revaluation reserves which have already been realised. UNITED MALAYAN LAND BHD (4131-M) 87
Company Statement of Changes in Equity FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
Non-distributable Distributable Share Share Merger Treasury Retained Revaluation Note capital premium reserve shares earnings reserves* Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
As at 1 January 2009 241,705 63,971 209,375 (463) 53,292 15,256 583,136
Profi t for the fi nancial year – – – – 47,898 – 47,898
Total recognised income and expense for the fi nancial year – – – – 47,898 – 47,898 Final dividend paid for the fi nancial year ended 31 December 2008 12 – – – – (4,525) – (4,525) Interim dividends paid and payable for the fi nancial year ended 31 December 2009 12 – – – – (9,049) – (9,049) As at 31 December 2009 241,705 63,971 209,375 (463) 87,616 15,256 617,460
Non-distributable Distributable Share Share Share option Merger Treasury Retained Revaluation capital premium reserve reserve shares earnings reserves* Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
As at 1 January 2008 241,650 63,950 667 209,375 (463) 53,623 15,256 584,058
Profi t for the fi nancial year – – – – – 12,459 – 12,459
Total recognised income and expense for the fi nancial year – – – – – 12,459 – 12,459 Employees’ Share Option Scheme: – shares issued 55 21 (2) – – – – 74 – options expired – – (665) – – 665 – – Interim dividend paid for the fi nancial year ended 31 December 2007 – – – – – (63) – (63) Final dividend paid for the fi nancial year ended 31 December 2007 – – – – – (13,392) – (13,392) As at 31 December 2008 241,705 63,971 – 209,375 (463) 53,292 15,256 583,136
* This represents the accumulated revaluation reserves which have already been realised. 88 UNITED MALAYAN LAND BHD (4131-M)
Cash Flow Statements FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
CASH FLOW FROM OPERATING ACTIVITIES Profi t before tax 62,917 576 61,488 16,739
Adjustments for: Allowance for doubtful debts 1,712 3,300 – – Depreciation of property, plant and equipment and investment properties 1,483 1,841 439 462 Gain on disposal of property, plant and equipment (36,459) (31) – (18) Gross dividend income from subsidiary companies – – (65,695) (19,208) Impairment loss of other investments 3,099 1,973 3,099 1,973 Interest expense 8,618 9,842 4,906 4,509 Interest income (681) (3,423) (6,755) (8,154) Loss on disposal of property, plant and equipment 99 – 99 – Negative goodwill – (4) – – Property, plant and equipment written off 1 4 – – Share of results of jointly controlled entities (1,158) 316 – – Write-back of allowance for doubtful debts (5,134) (1,886) – – Write-back for penalty charges – (2,500) – – Write-down of inventories 539 – – – 35,036 10,008 (2,419) (3,697) Decrease/(increase) in land held for property development, completed properties and property development costs 40,045 (41,462) – – (Increase)/decrease in receivables (59,512) 102,065 79,651 (42,592) Decrease in payables (27,206) (8,350) (369) (366) Net cash fl ow from operations (11,637) 62,261 76,863 (46,655) Interest paid (10,526) (13,238) (4,921) (4,460) Interest received 1,589 3,593 3,159 10,985 Tax (paid)/refunded (7,386) (2,678) (183) 174 Net cash fl ow from operating activities (27,960) 49,938 74,918 (39,956)
CASH FLOW FROM INVESTING ACTIVITIES Acquisition of a subsidiary company, net of cash acquired (Note 15(a)) – (5,199) – – Dividend received from a jointly controlled entity 455 – – – Additions in investment properties (227) – – – Investment in subsidiary companies – – (83,262) (25,052) Net dividend income from subsidiary companies – – 46,969 19,535 Proceeds from disposal of property, plant and equipment 85,490 175 102 162 Proceeds from disposal of other investments 9 – – – Purchase of property, plant and equipment (2,414) (853) (45) (435) Net cash fl ow from investing activities 83,313 (5,877) (36,236) (5,790) UNITED MALAYAN LAND BHD (4131-M) 89
Cash Flow Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
CASH FLOW FROM FINANCING ACTIVITIES Dividends paid to equity holders of the Company (9,049) (17,856) (9,049) (17,856) Dividends paid to minority interests (19,575) (5,801) – – Finance lease principal payments (260) (249) (260) (249) Net (repayment)/drawdown of borrowings (81,826) 24,068 (22,500) 40,500 Proceeds from issuance of ordinary shares on exercise of ESOS – 74 – 74 Proceeds from issuance of ordinary shares in a subsidiary company to a minority interest – 797 – – Net cash fl ow from fi nancing activities (110,710) 1,033 (31,809) 22,469
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS (55,357) 45,094 6,873 (23,277)
CASH AND CASH EQUIVALENTS AT BEGINNING OF THE FINANCIAL YEAR 108,749 63,655 (3,141) 20,136 CASH AND CASH EQUIVALENTS AT END OF THE FINANCIAL YEAR 53,392 108,749 3,732 (3,141)
Cash and cash equivalents comprise: Bank and cash balances (Note 24) 3,711 9,787 732 1,808 Bank balances under Housing Development Accounts (“HDA”) (Note 24) 15,874 29,240 – – Bank balances under sinking fund (Note 24) 1,252 1,215 – – Fixed deposits (Note 24) 24,755 63,505 – – Short term money market deposits (Note 24) 17,350 20,000 3,000 – Bank overdrafts (Note 28) (9,550) (14,998) – (4,949) 53,392 108,749 3,732 (3,141) 90 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
1. CORPORATE INFORMATION The Company is a public limited liability company, incorporated and domiciled in Malaysia, and listed on the Main Board of Bursa Malaysia Securities Berhad.
The address of the registered offi ce of the Company is as follows: Suite 1.1, 1st Floor Kompleks Antarabangsa Jalan Sultan Ismail 50250 Kuala Lumpur Malaysia
Telephone : (603) 2142 1611 Fax : (603) 2142 1826 Website : http://www.umland.com.my
The principal activities of the Company are investment holding and the provision of management services.
The principal activitiy of the subsidiary companies is property development. Other activities include property investment and investment holding.
There were no signifi cant changes in the nature of these activities during the fi nancial year.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The following accounting policies have been used consistently in dealing with items which are considered material in relation to the fi nancial statements.
(a) Basis of preparation The fi nancial statements of the Group and Company have been prepared under the historical cost convention (as modifi ed to include the revaluation of certain property, plant and equipment), unless otherwise indicated in this summary of signifi cant accounting policies.
The fi nancial statements comply with Financial Reporting Standards (“FRSs”), the MASB Approved Accounting Standards in Malaysia for Entities Other than Private Entities and the provisions of Companies Act, 1965.
The preparation of the fi nancial statements in conformity with FRSs requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the fi nancial statements, and the reported amounts of revenues and expenses during the reported fi nancial year. Although these estimates and judgments are based on the Directors’ best knowledge of current events and actions, actual results may differ.
The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are signifi cant to the fi nancial statements, are disclosed in Note 3. UNITED MALAYAN LAND BHD (4131-M) 91
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (a) Basis of preparation (cont’d.) (i) Standards, amendments to published standards and interpretations to existing standards that are not yet effective and have not been early adopted
The Group and Company have not early adopted the following standards, amendments to published standards and interpretations to existing standards that are mandatory for fi nancial periods beginning on or after 1 January 2010 or later periods:
• Amendment to FRS 1 “First-time Adoption of Financial Reporting Standards” and FRS 127 “Consolidated and Separate Financial Statements: Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment allows fi rst-time adopters to use a deemed cost of either fair value or the carrying amount under previous accounting practice to measure the initial cost of investments in subsidiaries, jointly controlled entities and associates in the separate fi nancial statements. The amendment also removes the defi nition of the cost method from FRS 127 and requires investors to present dividends as income in the separate fi nancial statements.
• Amendment to FRS 2 “Share-based Payment – Vesting Conditions and Cancellations” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment deals with vesting conditions and cancellations. It clarifi es that vesting conditions are service conditions and performance conditions only. Other features of a share-based payment are not vesting conditions. These features would need to be included in the grant date fair value for transactions with employees and others providing similar services; they would not impact the number of awards expected to vest or valuation there of subsequent to grant date. All cancellations, whether by the entity or by other parties, should receive the same accounting treatment.
• Amendment to FRS 5 “Non-current Assets Held for Sale and Discontinued Operations” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that FRS 5 disclosures apply to non-current assets or disposal groups that are classifi ed as held for sale and discontinued operations.
• FRS 7 “Financial Instruments: Disclosures” and Amendment to FRS 7 (effective for fi nancial periods beginning on or after 1 January 2010). This standard provides information to users of fi nancial statements about an entity’s exposure to risks and how the entity manages those risks. The improvement to FRS 7 clarifi es that entities must not present total interest income and expense as a net amount within fi nance costs on the face of the income statement.
• FRS 8 “Operating Segments” (effective for fi nancial periods beginning on or after 1 July 2009). This standard requires a ‘management approach’, under which segment information is reported in a manner that is consistent with the internal reporting provided to the chief operating decision-maker.
• Amendment to FRS 8 “Operating Segments” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that entities that do not provide information about segment assets to the chief operating decision- maker will no longer need to report this information. Prior year comparatives must be restated. 92 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (a) Basis of preparation (cont’d.) (i) Standards, amendments to published standards and interpretations to existing standards that are not yet effective and have not been early adopted (cont’d.)
• Revised FRS 101 “Presentation of Financial Statements” (effective for fi nancial periods beginning on or after 1 January 2010). This standard prohibits the presentation of items of income and expenses (that is, ‘non-owner changes in equity’) in the statement of changes in equity. ‘Non-owner changes in equity’ are to be presented separately from owner changes in equity. All non-owner changes in equity will be required to be shown in a performance statement, but entities can choose whether to present one performance statement (the statement of comprehensive income) or two statements (the income statement and statement of comprehensive income).
Where entities restate or reclassify comparative information, they will be required to present a restated balance sheet as at the beginning comparative period in addition to the current requirement to present balance sheets at the end of the current period and comparative period.
• Amendment to FRS 107 “Statement of Cash Flows” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that only expenditure resulting in a recognised asset can be categorised as a cash fl ow from investing activities.
• Amendment to FRS 108 “Accounting Policies, Changes in Accounting Estimates and Errors” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that guidance to FRSs states whether it is an integral part of FRSs. Guidance that is an integral part of FRSs is mandatory. Guidance that is not an integral part of FRSs does not contain requirements for fi nancial statements.
• Amendment to FRS 110 “Events after the Balance Sheet Date” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment reinforces existing guidance that a dividend declared after the reporting date is not a liability of an entity at that date given that there is no obligation at that time.
• Amendment to FRS 116 “Property, Plant and Equipment” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment requires entities whose ordinary activities comprise of renting and subsequently selling assets to present proceeds from the sale of those assets as revenue and should transfer the carrying amount of the asset to inventories when the asset becomes held for sale. A consequential amendment to FRS 107 states that cash fl ows arising from purchase, rental and sale of those assets are classifi ed as cash fl ows from operating activities.
• Amendment to FRS 117 “Leases” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that the default classifi cation of the land element in a land and building lease is no longer an operating lease. As a result, leases of land should be classifi ed as either fi nance or operating, using the general principles of FRS 117.
• Amendment to FRS 118 “Revenue” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment provides more guidance when determining whether an entity is acting as a ‘principal’ or as an ‘agent’. UNITED MALAYAN LAND BHD (4131-M) 93
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (a) Basis of preparation (cont’d.) (i) Standards, amendments to published standards and interpretations to existing standards that are not yet effective and have not been early adopted (cont’d.)
• Amendment to FRS 119 “Employee Benefi ts” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that a plan amendment that results in a change in the extent to which benefi t promises are affected by future salary increases is a curtailment, while an amendment that changes benefi ts attributable to past service gives rise to a negative past service cost if it results in a reduction in the present value of the defi ned benefi t obligation. The defi nition of return on plan assets has been amended to state that plan administration costs are deducted in the calculation of return on plan assets only to the extent that such costs have been excluded from measurement of the defi ned benefi t obligation.
• FRS 123 “Borrowing Costs” and Amendment to FRS 123 (effective for fi nancial periods beginning on or after 1 January 2010). This standard requires an entity to capitalise borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset (one that takes a substantial period of time to get ready for use or sale) as part of the cost of that asset. The option of immediately expensing those borrowing costs is removed. The improvement to FRS 123 clarifi es that the defi nition of borrowing costs includes interest expense calculated using the effective interest method defi ned in FRS 139 “Financial Instruments: Recognition and Measurement”.
• Amendment to FRS 127 “Consolidated and Separate Financial Statements” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that where an investment in a subsidiary that is accounted for under FRS 139 is classifi ed as held for sale under FRS 5, FRS 139 would continue to be applied.
• Amendment to FRS 128 “Investments in Associates” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that an investment in an associate is treated as a single asset for impairment testing purposes. Reversals of impairment are recorded as an adjustment to the carrying amount of the investment to the extent that the recoverable amount of the associate increases.
• Amendments to FRS 128 and FRS 131 “Interests in Joint Ventures” (consequential amendments to FRS 132 “Financial Instruments: Presentation” and FRS 7 (effective for fi nancial periods beginning on or after 1 January 2010). These amendments clarify that where an investment in associate or joint venture is accounted for in accordance with FRS 139, only certain, rather than all disclosure requirements in FRS 128 or FRS 131 need to be made in addition to disclosures required by FRS 132 and FRS 7.
• Amendment to FRS 132 “Financial Instruments: Presentation” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment requires entities to classify puttable fi nancial instruments and instruments that impose on the entity an obligation to deliver to another party a prorata share of the net assets of the entity only on liquidation as equity, if they have particular features and meet specifi c conditions.
• Amendment to FRS 134 “Interim Financial Reporting” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that basic and diluted earnings per share (“EPS”) must be presented in an interim report only in the case when the entity is required to disclose EPS in its annual report. 94 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (a) Basis of preparation (cont’d.) (i) Standards, amendments to published standards and interpretations to existing standards that are not yet effective and have not been early adopted (cont’d.)
• Amendment to FRS 136 “Impairment of Assets” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that the largest cash-generating unit (or group of units) to which goodwill should be allocated for the purposes of impairment testing is an operating segment before the aggregation of segments with similar economic characteristics. The improvement also clarifi es that where fair value less costs to sell is calculated on the basis of discounted cash fl ows, disclosures equivalent to those for value in use should be made.
• Amendment to FRS 138 “Intangible Assets” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment clarifi es that a prepayment may only be recognised in the event that payment has been made in advance of obtaining right of access to goods or receipt of services. This means that an expense will be recognised for mail order catalogues when the entity has access to the catalogues and not when the catalogues are distributed to customers. It confi rms that the unit of production method of amortisation is allowed.
• FRS 139 “Financial Instruments: Recognition and Measurement” and Amendment to FRS 139 (effective for fi nancial periods beginning on or after 1 January 2010). This standard establishes principles for recognising and measuring fi nancial assets, fi nancial liabilities and some contracts to buy and sell non-fi nancial items. Hedge accounting is permitted under strict circumstances. The amendment to FRS 139 provides further guidance on eligible hedged items. The improvement to FRS 139 clarifi es that the scope exemption in FRS 139 only applies to forward contracts but not options for business combinations that are fi rmly committed to being completed within a reasonable timeframe.
• Amendment to FRS 140 “Investment Property” (effective for fi nancial periods beginning on or after 1 January 2010). This amendment requires assets under construction or development for future use as investment property to be accounted as investment property rather than property, plant and equipment. Where the fair value model is applied, such property is measured at fair value. However, where fair value is not reliably measurable, the property is measured at cost until the earlier of the date construction is completed and fair value becomes reliably measurable. It also clarifi es that if a valuation obtained for an investment property held under lease is net of all expected payments, any recognised lease liability is added back in order to determine the carrying amount of the investment property under the fair value model.
• IC Interpretation 9 “Reassessment of Embedded Derivatives” (effective for fi nancial periods beginning on or after 1 January 2010). This interpretation requires an entity to assess whether an embedded derivative is required to be separated from the host contract and accounted for as a derivative when the entity fi rst becomes a party to the contract. Subsequent reassessment is prohibited unless there is a change in the terms of the contract that signifi cantly modifi es the cash fl ows that otherwise would be required under the contract, in which case reassessment is required.
• IC Interpretation 10 “Interim Financial Reporting and Impairment” (effective for fi nancial periods beginning on or after 1 January 2010). This interpretation prohibits the impairment losses recognised in an interim period on goodwill and investments in equity instruments and in fi nancial assets carried at cost to be reversed at a subsequent balance sheet date. UNITED MALAYAN LAND BHD (4131-M) 95
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (a) Basis of preparation (cont’d.) (i) Standards, amendments to published standards and interpretations to existing standards that are not yet effective and have not been early adopted (cont’d.)
• IC Interpretation 11 “FRS 2 – Group and Treasury Share Transactions” (effective for fi nancial periods beginning on or after 1 January 2010). This interpretation provides guidance on whether share-based transactions involving treasury shares or involving group entities should be accounted for as equity-settled or cash-settled share-based payment transactions in the stand-alone accounts of the parent and group companies.
• IC Interpretation 13 “Customer Loyalty Programmes” (effective for fi nancial periods beginning on or after 1 January 2010). This interpretation clarifi es that where goods or services are sold together with a customer loyalty incentive, the arrangement is a multiple-element arrangement and the consideration receivable from the customer is allocated between the components of the arrangement using fair values.
• IC Interpretation 14 “FRS 119 – The Limit on a Defi ned Benefi t Asset, Minimum Funding Requirements and Their Interaction” (effective for fi nancial periods beginning on or after 1 January 2010). This interpretation provides guidance on assessing the limit in FRS 119 on the amount of the surplus that can be recognised as an asset.
With the exception of FRS 7 and FRS 139, the Group and Company do not anticipate the above standards, amendments to published standards and interpretations to existing standards to have any signifi cant impact on the fi nancial statements of the Group and Company. The Group and Company have applied the transitional provision in FRS 7 and FRS 139, which exempts entities from disclosing the possible impact arising from the initial application of these standards on the fi nancial statements of the Group and Company.
The Group and Company will apply the above standards, amendments to published standards and interpretations to existing standards from fi nancial periods beginning on 1 January 2010.
• Amendment to FRS 2 “Share-based Payment” (effective for fi nancial periods beginning on or after 1 July 2010). This amendment clarifi es that contributions of a business on formation of a joint venture and common control transactions are outside the scope of FRS 2.
• Revised FRS 3 “Business Combinations” (effective for fi nancial periods beginning on or after 1 July 2010). This standard continues to apply the acquisition method to business combinations, with some signifi cant changes. For example, all payments to purchase a business are to be recorded at fair value at the acquisition date, with contingent payments classifi ed as debt subsequently re-measured through the income statement. There is a choice on an acquisition-by- acquisition basis to measure the non-controlling interest in the acquiree either at fair vale or at the non-controlling interest’s proportionate share of the acquiree’s net assets. All acquisition-related costs should be expensed.
• Amendment to FRS 5 “Non-current Assets Held for Sale and Discontinued Operations” (effective for fi nancial periods beginning on or after 1 July 2010). This amendment clarifi es that all of a subsidiary’s assets and liabilities are classifi ed as held for sale if a partial disposal sale plan results in loss of control. Relevant disclosure should be made for this subsidiary if the defi nition of a discontinued operation is met. 96 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (a) Basis of preparation (cont’d.) (i) Standards, amendments to published standards and interpretations to existing standards that are not yet effective and have not been early adopted (cont’d.)
• Revised FRS 127 “Consolidated and Separate Financial Statements” (effective for fi nancial periods beginning on or after 1 July 2010). This standard requires the effects of all transactions with non-controlling interests to be recorded in equity if there is no change in control and these transactions will no longer result in goodwill or gains and losses. The standard also specifi es the accounting when control is lost. Any remaining interest in the entity is re-measured to fair value, and a gain or loss is recognised in the income statement.
• Amendment to FRS 138 “Intangible Assets” (effective for fi nancial periods beginning on or after 1 July 2010). This amendment clarifi es that a group of complementary intangible assets acquired in a business combination is recognised as a single asset if the individual asset has similar useful lives.
• Amendment to IC Interpretation 9 “Reassessment of Embedded Derivatives” (effective for fi nancial periods beginning on or after 1 July 2010). This amendment clarifi es that this interpretation does not apply to embedded derivatives in contracts acquired in a business combination, businesses under common control or the formation of a joint venture.
• IC Interpretation 12 “Service Concession Arrangements” (effective for fi nancial periods beginning on or after 1 July 2010). This interpretation applies to contractual arrangements whereby a private sector operator participates in the development, fi nancing, operation and maintenance of infrastructure for public sector services. Depending on the contractual terms, this interpretation requires the operator to recognise a fi nancial asset if it has an unconditional contractual right to receive cash or an intangible asset if it receives a right (license) to charge users of the public service. Some contractual terms may give rise to both a fi nancial asset and an intangible asset.
• IC Interpretation 15 “Agreements for the Construction of Real Estate” (effective for fi nancial periods beginning on or after 1 July 2010). This interpretation provides guidance on whether FRS 118 “Revenue” or FRS 111 “Construction Contracts” should be applied to particular transactions. It clarifi es when and how revenue and related expenses from the sale of a real estate unit should be recognised if an agreement between developer and a buyer is reached before the construction of the real estate is completed.
With IC Interpretation 15, the Group will have to change its accounting policy from recognising revenue by stage of completion method to completion method.
• IC Interpretation 16 “Hedges of a Net Investment in a Foreign Operation” (effective for fi nancial periods beginning on or after 1 July 2010). This interpretation clarifi es the accounting treatment in respect of net investment hedging. This includes the fact that net investment hedging relates to differences in functional currency not presentation currency, and hedging instruments may be held by any entity in the group. The requirements of FRS 121 “The Effects of Changes in Foreign Exchange Rates” do apply to the hedged item.
• IC Interpretation 17 “Distributions of Non-cash Assets to Owners” (effective for fi nancial periods beginning on or after 1 July 2010). This interpretation provides guidance on accounting for arrangements whereby an entity distributes non- cash assets to shareholders either as a distribution of reserves or as dividends. FRS 5 has also been amended to require that assets are classifi ed as held for distribution only when they are available for distribution in their present condition and the distribution is highly probable. UNITED MALAYAN LAND BHD (4131-M) 97
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (a) Basis of preparation (cont’d.) (i) Standards, amendments to published standards and interpretations to existing standards that are not yet effective and have not been early adopted (cont’d.)
With the exception of IC Interpretation 15, the Group and Company do not anticipate the above standards, amendments to published standards and interpretations to existing standards to have any signifi cant impact on the fi nancial statements of the Group and Company.
The Group and Company will apply the above standards, amendments to published standards and interpretations to existing standard from fi nancial periods beginning on 1 January 2011.
(b) Basis of consolidation The consolidated fi nancial statements include the fi nancial statements of the Company and all its subsidiary companies made up to the end of the fi nancial year. Subsidiary companies are those companies in which the Group has power to exercise control over the fi nancial and operating policies so as to obtain benefi ts from their activities. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity.
Subsidiary companies are consolidated using the purchase method of accounting except for a subsidiary company (as disclosed in Note 15 to the fi nancial statements) which was accounted for using the merger method of accounting. The subsidiary was consolidated prior to 1 January 2002 in accordance with Malaysian Accounting Standard No. 2 “Accounting for Acquisitions and Mergers”, the generally accepted accounting principle prevailing at that time.
The Group has used the exemption provided by FRS 1222004 “Business Combinations” and FRS 3 to apply these Standards prospectively. Accordingly, business combinations entered into prior to the respective effective dates have not been restated to comply with these Standards.
Under the purchase method of accounting, subsidiary companies are consolidated from the date control is transferred to the Group and are no longer consolidated from the date that control ceases. The results of subsidiary companies acquired or disposed of during the fi nancial year are included from the date of acquisition up to the date of disposal. At the date of acquisition, the fair values of the subsidiary companies’ net assets are determined and these values are refl ected in the consolidated fi nancial statements.
The excess of the cost of acquisition over the Group’s interest in the net fair value of the subsidiary company’s identifi able assets, liabilities and contingent liabilities at the date of acquisition is refl ected as goodwill. See accounting policy Note 2(d) on goodwill. If the cost of acquisition is less than the net fair value of the identifi able assets, liabilities and contingent liabilities of the subsidiary company acquired, the difference is recognised directly in the income statement. The cost of acquisition is measured as the aggregate of the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. 98 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (b) Basis of consolidation (cont’d.) Under the merger method of accounting, the results of the subsidiary company are presented as if the merger had been effected throughout the current and previous fi nancial years. The assets and liabilities combined are accounted for based on the carrying amounts from the perspective of the common control shareholder at the date of transfer. On consolidation, the cost of the merger is cancelled with the values of the shares received. Any resulting credit balance is classifi ed as equity and regarded as a non-distributable reserve. Any resulting debit difference is adjusted against any suitable reserve. Any share premium, capital redemption reserve and any other reserves which are attributable to share capital of the merged enterprises, to the extent that they have not been capitalised by a debit difference, are reclassifi ed and presented as movement in other capital reserves. Expenditure incurred in connection with the merger is recognised as an expense in the income statement.
All inter-company transactions, balances and unrealised gains on transactions are eliminated; unrealised losses are also eliminated unless costs cannot be recovered in which case such costs are charged to the income statement immediately. Accounting policies for subsidiary companies have been changed to ensure consistency with the policies adopted by the Group.
When the acquisition of a subsidiary company involves stages of successive share acquisition, any adjustment to the fair values of the subsidiary company’s identifi able assets, liabilities and contingent liabilities relating to previously held interests of the Group is accounted for as a revaluation.
Minority interest represent the portion of the profi t or loss and net assets in subsidiary companies attributable to equity interests that are not owned, directly or indirectly through subsidiary companies, by the Group. It is measured at the minorities’ share of the fair value of the subsidiary companies’ identifi able assets and liabilities at the acquisition date and the minorities’ share of changes in the subsidiary companies’ equity since that date.
(c) Jointly controlled entities Jointly controlled entities are entities over which there is contractually agreed sharing of control by the Group with one or more parties where the strategic fi nancial and operating decisions relating to the entities require unanimous consent of the parties sharing control.
The Group’s interest in jointly controlled entities is accounted for in the consolidated fi nancial statements using the equity method of accounting. The Group’s investments in jointly controlled entities include goodwill identifi ed on acquisition, net of any accumulated impairment losses. See accounting policy Note 2(h) on impairment of assets.
Under the equity method of accounting, the Group’s share of the post-acquisition profi t or loss of the jointly controlled entities is recognised in the consolidated income statement and its share of post-acquisition movements within reserves is recognised in reserves. The cumulative post-acquisition movements are adjusted against the carrying amount of the investments.
The Group recognises the portion of profi ts or losses on the sale of assets of the Group to the joint venture that is attributable to the other venturers. The Group does not recognise its share of profi ts or losses from the joint venture that result from the purchase of assets by the Group from the joint venture until it resells the assets to an independent party. However, a loss on the transaction is recognised immediately if the loss provides evidence of a reduction in the net realisable value of current assets or an impairment loss.
Where necessary, in applying the equity method of accounting, adjustments are made to the fi nancial statements of jointly controlled entities to ensure consistency of accounting policies with those of the Group. UNITED MALAYAN LAND BHD (4131-M) 99
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (d) Goodwill Goodwill represents the excess of the cost of acquisition over the fair values of the Group’s share of the subsidiary companies’ and jointly controlled entities’ identifi able net assets at the date of acquisition.
Goodwill is measured at cost less any accumulated impairment losses. Goodwill is not amortised but it is reviewed for impairment, annually or more frequently, if events or changes in circumstances indicate that the carrying amount may be impaired. Impairment losses on goodwill are not reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity disposed.
Goodwill is allocated to cash-generating units (“CGUs”) for the purpose of impairment testing. The allocation is made to those CGUs or groups of CGUs that are expected to benefi t from the synergies of the business combination in which the goodwill arose.
Goodwill on acquisitions of jointly controlled entities are included in the carrying amount of these investments. The entire carrying amount of these investments is tested for impairment when there is objective evidence of impairment. See accounting policy Note 2(h) on impairment of assets.
(e) Property, plant and equipment Property, plant and equipment are initially stated at cost. 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 economics benefi ts associated with the item will fl ow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is not recognised. All other repairs and maintenance costs are charged to the income statement during the fi nancial period in which they are incurred.
Subsequent to recognition, property, plant and equipment except for freehold land, are stated at cost less accumulated depreciation and accumulated impairment losses.
Freehold land is stated at cost or valuation. Freehold land is not depreciated as it has an infi nite life. The freehold land was revalued by the Directors based on professional valuations carried out by independent professional valuers. The Directors have applied the transitional provision issued by MASB on adoption of FRS 116 “Property, Plant and Equipment”, which allows these assets to be stated at their 1990 and 1996 valuations. Accordingly, the valuations have not been updated.
Surpluses arising on revaluation are credited to non-distributable revaluation reserves. Defi cits arising on revaluation are charged against non-distributable revaluation reserves to the extent of previous surpluses credited to non-distributable revaluation reserves of the same asset. In all other cases, a decrease in carrying amount is charged to the income statement. Upon disposal or retirement of an asset, any revaluation reserve relating to the particular asset is transferred directly to distributable revaluation reserves.
All other property, plant and equipment are depreciated on a straight line basis to write-off the cost of the assets, to their residual values over their estimated useful lives, summarised as follows: Buildings 20 years Furniture, fi ttings and equipment 5 years Motor vehicles 5 years Plant and machinery 5 years Stable and equestrian equipment 5 years 100 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (e) Property, plant and equipment (cont’d.) Depreciation on assets under construction commences when the assets are ready for their intended use.
The residual values and useful lives of assets are reviewed and adjusted if appropriate, at each balance sheet date.
Where an indication of impairment exists at the balance sheet date, an analysis is performed to assess whether the carrying amount of the asset is fully recoverable. A write-down is made if the carrying amount exceeds the recoverable amount. See accounting policy Note 2(h) on impairment of assets.
On disposal of an asset, the difference between the net disposal proceeds and its carrying amount is charged or credited to the income statement. In the case of revalued land, the amount in non-distributable revaluation reserve relating to these revalued lands which had been disposed is transferred to distributable revaluation reserves.
(f) Investment properties Investment properties are properties which are held either to earn rental income or for capital appreciation or for both, and are not occupied by the Group.
Investment properties comprise freehold land and buildings.
Freehold land is stated at cost or valuation. Freehold land is not depreciated as it has an infi nite life. The freehold land was revalued by the Directors based on professional valuations carried out by independent professional valuers. The Directors have applied the transitional provision issued by MASB on adoption of FRS 116, which allows these assets to be stated at their 1990 and 1996 valuations. Accordingly, the freehold land was transferred to “Investment properties” at its carrying amount.
Buildings are stated at cost less accumulated depreciation and accumulated impairment losses. Buildings are depreciated on a straight line basis over the estimated useful lives of 20 years.
Investment property is derecognised upon disposal or the investment property is permanently withdrawn from use and no future economics benefi t is expected from its disposal. The difference between the net disposal proceeds and the carrying amount is charged or credited to the income statement in the fi nancial period of the retirement or disposal.
(g) Investments Investments in subsidiary companies and jointly controlled entities are stated at cost less accumulated impairment losses. Where an indication of impairment exists, the carrying amount of the investments is assessed and written down immediately to its recoverable amount. See accounting policy Note 2(h) on impairment of assets.
Investments in other non-current investments are stated at cost and an allowance for diminution in value is made where, in the opinion of the Directors, there is a decline other than temporary in the value of such investments. Where there has been a decline other than temporary in the value of an investment, such a decline is recognised as an expense in the period in which the decline is identifi ed.
On disposal of an investment, the difference between the net disposal proceeds and its carrying amount is charged or credited to the income statement. UNITED MALAYAN LAND BHD (4131-M) 101
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (h) Impairment of assets Assets that have indefi nite useful life are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Impairment loss is recognised for the amount by which the carrying amount of the asset exceeds its recoverable amount.
Recoverable amount is the higher of an asset’s or CGU’s fair value less costs to sell and its value in use. In assessing value in use, the estimated future cash fl ows are discounted to their present value using a pre-tax discount rate that refl ects current market assessments of the time value of money and the risks specifi c to the asset.
For the purpose of assessing impairment, recoverable amount is determined on an individual asset basis unless the asset does not generate cash fl ows that are largely independent of those from the other assets. If this is the case, recoverable amount is determined for the CGU to which the asset belongs to.
The impairment loss is charged to the income statement in the fi nancial period in which it arises, unless the asset is carried at a revalued amount, in which case the impairment loss is accounted for as a revaluation decrease to the extent that the impairment loss does not exceed the amount held in the asset revaluation reserve for the same asset.
Impairment loss on goodwill is not reversed in a subsequent fi nancial period. Impairment loss for an asset other than goodwill is reversed if, and only if, there has been change in the estimates used to determine the asset’s recoverable amount since the last impairment loss recognition. The carrying amount of an asset other than goodwill is increased to its revised recoverable amount provided that this amount does not exceed the carrying amount that would have been determined (net of amortisation and depreciation) had no impairment loss had been recognised for the asset in prior fi nancial years. A reversal of impairment loss for an asset other than goodwill is recognised in the income statement, unless the asset is carried at revalued amount, in which case such reversal is treated as a revaluation increase.
(i) Completed properties Properties which have been completed but not sold are classifi ed as “Completed properties” and are stated at the lower of cost and net realisable value. The cost of unsold properties comprises cost associated with the acquisition of land, direct costs and appropriate proportion of allocated costs attributable to property development activities.
Net realisable value is the estimate of the selling price in the ordinary course of business, less the costs of completion and selling expenses. 102 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (j) Property development activities (i) Land held for property development Land held for property development consists of land upon which no signifi cant development work has been undertaken or where development activities are not expected to be completed within the normal operating cycle. Such land is classifi ed as non-current asset and is stated at cost less accumulated impairment losses.
Cost of land includes the purchase price of the land, professional fees, stamp duties, commissions, conversion fees and other relevant levies. Where the Group had previously recorded the land at revalued amount, it continues to retain this amount as its surrogate cost as allowed by FRS 201 “Property Development Activities”. Where an indication of impairment exists, the carrying amount of the asset is assessed and written down immediately to its recoverable amount. See accounting policy Note 2(h) on impairment of assets.
Land held for property development is transferred to “Property development costs” (under current assets) upon commencement of development activities and where the development activities can be completed within the Group’s normal operating cycle.
(ii) Property development costs Property development costs comprise cost of land and all costs directly attributable to development activities or that can be allocated on a reasonable basis to those activities. It includes borrowing costs related to the fi nancing of development activities of the land, related development costs common to the development project and direct construction costs. Borrowing costs are included in the property development costs until the completion of the development projects.
When the outcome of the development activities can be estimated reliably, property development revenue and expenses are recognised by using the stage of completion method as stated in Note 2(w) on revenue recognition.
When the outcome of the development activities cannot be estimated reliably, property development revenue is recognised only to the extent of property development costs incurred that is probable will be recoverable; property development costs on the development units sold are recognised when incurred.
Irrespective of whether the outcome of property development activities can or cannot be estimated reliably, when it is probable that total property development costs will exceed total property development revenue, the expected loss is recognised as an expense immediately. Property development costs not recognised as an expense are recognised as an asset and stated at the lower of cost and net realisable value.
Where revenue recognised in the income statement exceeds billings to purchasers, the balance is presented as accrued billings under “Trade and other receivables” (within current assets). Where billings to purchasers exceed revenue recognised in the income statement, the balance is presented as progress billings under “Trade and other payables” (within current liabilities).
(k) Trade receivables Trade receivables are carried at invoiced amount less an allowance for doubtful debts. The allowance is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables.
Trade receivables arising from the sale of completed properties under instalment schemes are recorded at their fair value, which is determined by discounting all future receipts using an imputed rate of interest. UNITED MALAYAN LAND BHD (4131-M) 103
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (l) Cash and cash equivalents For the purposes of the cash fl ow statements, cash and cash equivalents comprise cash in hand, bank balances, deposits held at call with banks, short-term and highly liquid investments with original maturities of three months or less, and bank overdrafts.
Bank overdrafts are included within “Borrowings” in current liabilities in the balance sheet.
(m) Share capital (i) Classifi cation Ordinary shares are classifi ed as equity. Distributions to holders of a fi nancial instrument classifi ed as an equity instrument are charged directly to equity.
(ii) Share issue costs Incremental external costs directly attributable to the issue of new shares or options over ordinary shares are shown in equity as a deduction, net of tax, from the proceeds.
(iii) Dividends to shareholders of the Company Interim dividends on ordinary shares are recognised as liabilities when proposed.
Final dividend proposed after the balance sheet date is not recognised as a liability at the balance sheet date until its approval by the shareholders at the Annual General Meeting.
(n) Purchase of own shares Where the Company or its subsidiary companies purchase the Company’s equity share capital, the consideration paid, including any directly attributable incremental external costs, net of tax, is deducted from equity as treasury shares until they are cancelled, reissued or disposed of. Where such shares are subsequently sold or reissued, any consideration received, net of any directly attributable incremental external costs and the related tax effects, is included in equity.
(o) Payables Payables are measured initially and subsequently at cost. Payables are recognised when there is a contractual obligation to deliver cash or another fi nancial asset to another entity.
(p) Borrowings Borrowings are initially recognised based on the proceeds received, net of transaction costs incurred. In subsequent fi nancial periods, borrowings are stated at amortised cost using the effective yield method. The difference between proceeds (net of transaction costs) and the redemption value is recognised in the income statement over the period of the borrowings.
Interest, dividends, losses and gains relating to a fi nancial instrument or a component part classifi ed as a liability, is reported within fi nance costs in the income statement.
Borrowings are classifi ed as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date. 104 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (q) Capitalisation of borrowing costs Borrowing costs incurred to fi nance the construction of property, plant and equipment are capitalised as part of the cost of the asset during the period of time that is required to complete and prepare the asset for its intended use. Borrowing costs incurred to fi nance property development activities are accounted for in the similar manner.
All other borrowing costs are recognised in the income statement in the fi nancial period in which they are incurred.
(r) Leases A lease is recognised as a fi nance lease if it transfers substantially to the Group all the risks and rewards incidental to ownership. All leases that do not transfer substantially all the risks and rewards are classifi ed as operating leases.
(i) Finance leases – the Group as Lessee Assets acquired by way of fi nance leases are stated at an amount equal to the lower of their fair values and the present value of the minimum lease payments at the inception of the leases, less accumulated depreciation and impairment losses. The corresponding liability is included in the balance sheet as “Borrowings”.
Lease payments are apportioned between the fi nance costs and the reduction of the outstanding liability. Finance costs, which represent the difference between the total leasing commitments and the fair value of the assets acquired, are recognised in the income statement over the term of the relevant lease so as to produce a constant periodic rate of charge on the remaining balance of the obligations for each accounting period.
Property, plant and equipment acquired under fi nance leases are depreciated over the shorter of the estimated useful life of the asset and the lease term.
(ii) Operating leases – the Group as Lessor Assets leased out under operating leases are presented in the balance sheet according to the nature of the assets. Rental income (net of any incentives given to the lessees) from operating leases is recognised on a straight line basis over the lease term.
(s) Provisions Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, when it is probable that an outfl ow of resources will be required to settle the obligation, and when a reliable estimate of the amount can be made.
Provisions are reviewed at each balance sheet date and adjusted to refl ect the current best estimate. Where the effect of time value of money is material, provisions are discounted using a current pre-tax rate that refl ects, where appropriate, the risks specifi c to the obligation. Where discounting is used, the increase in the provisions due to passage of time is recognised as fi nance cost. UNITED MALAYAN LAND BHD (4131-M) 105
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (t) Tax expense Tax expense in the income statement comprises current and deferred tax. Current tax expense is the expected amount of income taxes payable in respect of the taxable profi t for the fi nancial year and real property gains tax payable on the disposal of properties. Current tax expense is measured using the tax rates that have been enacted at the balance sheet date.
Deferred tax is recognised in full, using the liability method, on temporary differences arising between the amounts attributed to assets and liabilities for tax purposes and their carrying amounts in the fi nancial statements. However, deferred tax is not recognised if a temporary difference arises from goodwill or from the initial recognition of an asset or a liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profi t or loss.
Deferred tax assets are recognised to the extent that it is probable that taxable profi ts will be available against which the deductible temporary differences or unused tax losses can be utilised.
Deferred tax is recognised on temporary differences arising on investments in subsidiary companies and jointly controlled entities except where the timing of reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.
Deferred tax is determined using tax rates (and tax laws) that have been enacted or substantively enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.
(u) Employee benefi ts (i) Short term employee benefi ts Wages, salaries, paid annual leave, sick leave, bonuses, and non-monetary benefi ts are accrued in the period in which the associated services are rendered by the employees (including Executive Directors) of the Group.
(ii) Defi ned contribution plans Defi ned contribution plans are post-employment benefi t plans under which the Group pays fi xed contributions into separate entities or funds and will have no legal or constructive obligation to pay further contributions if any of the funds do not hold suffi cient assets to pay all employees’ benefi ts relating to employees’ services in the current and preceding fi nancial years. As required by law, companies in Malaysia make such contributions to the Employees’ Provident Fund (“EPF”), the national defi ned contribution plan. The Group’s contributions to EPF are charged to the income statement in the fi nancial period to which they relate. 106 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (u) Employee benefi ts (cont’d.) (iii) Share-based compensation The Group’s Employees’ Share Option Scheme (“ESOS”), an equity-settled, share-based compensation plan, allows the Group’s employees and Directors to acquire ordinary shares of the Company. The fair value of options over ordinary shares granted to employees and Directors is recognised in employees’ benefi ts expenses in the income statement with a corresponding increase in the share option reserve within equity over the vesting period, taking into account the probability that the options over ordinary shares will vest.
The fair value of options over ordinary shares is measured at grant date, taking into account, if any, the market vesting conditions upon which the options over ordinary shares were granted but excluding the impact of any non-market vesting conditions. Non-market vesting conditions are included in assumptions about the number of options over ordinary shares that are expected to become exercisable on vesting date.
At each balance sheet date, the Group revises its estimates of the number of options over ordinary shares that are expected to become exercisable on vesting date. It recognises the impact of the revision of original estimates, if any, in the income statement and a corresponding adjustment to equity over the remaining vesting period. The equity amount is recognised in the share option reserve until the options over ordinary shares are exercised, upon which it will be transferred to share premium, or until the options over ordinary shares expire, upon which it will be transferred directly to retained earnings.
The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share premium when the options over ordinary shares are exercised.
(v) Contingent liabilities and contingent assets The Group does not recognise a contingent liability but discloses its existence in the fi nancial statements. A contingent liability is a possible obligation that arises from past events whose existence will be confi rmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Group or a present obligation that is not recognised because it is not probable that an outfl ow of resources will be required to settle the obligation. A contingent liability also arises in the extremely rare circumstance where there is a liability that cannot be recognised because it cannot be measured reliably.
A contingent asset is a possible asset that arises from past events whose existence will be confi rmed by the occurrence or non- occurrence of one or more uncertain future events beyond the control of the Group. The Group does not recognise a contingent asset but discloses its existence where infl ows of economic benefi ts are probable, but not virtually certain. UNITED MALAYAN LAND BHD (4131-M) 107
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (w) Revenue recognition Revenue comprises the fair value of the consideration received or receivable, net of discounts and after eliminating sales within the Group.
The Group recognises revenue when the amount of revenue can be reliably measured and it is probable that future economic benefi ts will fl ow to the Group and specifi c criteria have been met for each of the Group’s activities as described below. The amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The Group bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifi cs of each arrangement.
Revenue from sale of development properties is recognised net of discounts, based on the stage of completion method. The stage of completion is measured by reference to the physical proportion of work completed as a percentage of total physical work of the project as certifi ed by duly appointed consultants.
Revenue from sale of completed properties is recognised net of discounts, in accordance with the terms of the sale and purchase agreements. The sales consideration of completed properties under instalment schemes are recorded at their fair value, which is determined by discounting all future receipts using an imputed rate of interest. The difference between the fair value and the nominal value of the sales consideration is recognised as interest income and taken to the income statement on a time proportion basis that takes into account the effective yield on the receivables arising from the sale of completed properties under the instalment schemes over the term of the instalment period.
Interest income is recognised on time proportion basis, taking into account the principal outstanding and the effective rate over the period of maturity, when it is determined that such income will accrue to the Group.
Interest on overdue amounts receivable from house buyers is recognised in the income statement as it accrues. An allowance for doubtful debts is made when the collectibility of this interest is in doubt.
Rental income from properties is recognised on a straight-line basis over the term of the lease.
Gross dividends from investments are taken up in the fi nancial statements when the Company’s right to receive payment is established.
Management fees and project management fees are recognised when services are rendered.
(x) Functional and presentation currency The fi nancial statements are presented in Ringgit Malaysia, which is the Company’s functional and presentation currency. 108 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) (y) Financial instruments Description A fi nancial instrument is any contract that gives rise to both a fi nancial asset of one enterprise and a fi nancial liability or equity instrument of another enterprise.
A fi nancial asset is any asset that is cash, a contractual right to receive cash or another fi nancial asset from another enterprise, a contractual right to exchange fi nancial instruments with another enterprise under conditions that are potentially favourable, or an equity instrument of another enterprise.
A fi nancial liability is any liability that is a contractual obligation to deliver cash or another fi nancial asset to another enterprise, or to exchange fi nancial instruments with another enterprise under conditions that are potentially unfavourable.
Financial instruments recognised in the balance sheet Financial instruments recognised in the balance sheet include deposits, bank and cash balances, investments, receivables, payables and borrowings. The recognition method adopted for fi nancial instruments recognised in the balance sheet is disclosed in the individual accounting policy statements associated with each item.
Fair value estimation for disclosure purposes In assessing the fair value of fi nancial instruments, the Group uses a variety of methods and makes assumptions that are based on market conditions existing at each balance sheet date. In particular, the fair value of fi nancial assets and fi nancial liabilities is estimated by discounting the future contractual cash fl ows at the current market interest rate available to the Group for similar fi nancial instruments. Fair value of other investments is determined based on the market value at the balance sheet date.
The face values of fi nancial assets (less any estimated credit adjustments) and fi nancial liabilities with a maturity period of less than one year are assumed to approximate their fair values.
3. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS Estimates and judgments are continually evaluated by the Directors and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Critical accounting estimates and assumptions The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by defi nition, rarely equal the related actual results. The estimates and assumptions that have a signifi cant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next fi nancial year are outlined below. (i) Revenue recognition Revenue from sale of development properties is recognised net of discounts, based on the stage of completion method. The stage of completion is measured by reference to the physical proportion of work completed as a stage of total physical work of the project as certifi ed by duly appointed consultants.
Signifi cant judgment is required in determining the stage of completion, the extent of the property development costs incurred, the estimated total property development costs to be incurred (including future common infrastructure costs) and the estimated proportion of the common infrastructure costs to be allocated to development properties. In making this judgment, the Group relies on past experience and the work of specialists. UNITED MALAYAN LAND BHD (4131-M) 109
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
3. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS (CONT’D.) Critical accounting estimates and assumptions (cont’d.) (ii) Deferred tax assets Deferred tax assets are recognised to the extent that it is probable that taxable profi ts will be available against which the deductible temporary differences or unused tax losses can be utilised. Management judgment is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level of future taxable profi ts.
Critical judgments in applying accounting policies There were no critical judgments used in applying the Group’s accounting policies.
4. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES The Group is exposed to various fi nancial risks including foreign currency exchange risk, interest rate risk, credit risk, liquidity risk and cash fl ow risk in the normal course of business. The Group’s overall fi nancial risk management objective is to ensure that the Group creates value for its shareholders. The Group focuses on the unpredictability of fi nancial markets and seeks to minimise potential adverse effects on the fi nancial performance of the Group. Financial risk management is carried out through risks review and internal control systems. The Board of Directors regularly reviews these risks to ensure that the Group’s fi nancial risk management policies are adhered to.
Foreign currency exchange risk The Group is not exposed to currency risk as foreign currency transactions entered into within the Group are minimal.
Interest rate risk The Group’s income and operating cash fl ows are substantially independent of changes in market interest rates. Interest rate exposure arises from the Group’s borrowings and is managed through the use of fi xed and fl oating rates debts. The Group actively monitors its borrowings to ensure that the Group will benefi t most from the operating environment.
Credit risk Concentration of credit risk with respect to trade receivables is limited as the ownership and rights to the properties revert to the Group in the event of default. The Group’s historical experience in collection of trade receivables falls within the recorded allowances. Due to these factors, management believes that no additional credit risk beyond amounts provided for collection losses is inherent in the Group’s trade receivables.
Liquidity and cash fl ow risk Prudent liquidity risk management implies maintaining suffi cient cash and the availability of funding through an adequate amount of committed credit facilities. The Group aims at maintaining fl exibility in funding by keeping committed credit lines available. 110 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
5. REVENUE
2009 2008 RM’000 RM’000
Group Revenue from property development 205,877 169,982 Interest income 326 518 Land lease rental income 46 85 Quarry lease rental income 416 – Rental income from investment properties 1,126 1,054 Rental income from properties 715 444 208,506 172,083
Company Dividend income from subsidiary companies 65,695 19,208 Interest income 6,755 8,154 Provision of management services 7,645 9,033 80,095 36,395
6. EMPLOYEE BENEFITS EXPENSES
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Wages, salaries and bonus 15,310 17,926 5,585 7,757 Defi ned contribution retirement plan 1,866 2,603 630 1,106 Other employee benefi ts 833 1,362 299 425 18,009 21,891 6,514 9,288
Employee benefi ts expenses include the remuneration of an Executive Director.
At the end of the fi nancial year, there were 261 (2008: 285) employees in the Group and 56 (2008: 66) employees in the Company. UNITED MALAYAN LAND BHD (4131-M) 111
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
7. KEY MANAGEMENT PERSONNEL COMPENSATION The remuneration of Directors and other key management personnel during the fi nancial year are as follows:-
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Directors: Executive Director: – fees 40 40 40 40 – basic salaries and bonus 373 420 373 420 – defi ned contribution retirement plan 48 63 48 63 – other emoluments 16 23 16 21 477 546 477 544
Non-Executive Directors: – fees 375 375 375 375 – other emoluments 94 85 94 79 469 460 469 454 946 1,006 946 998
Other key management personnel: – short term employee benefi ts 1,142 1,536 1,142 1,524 – defi ned contribution retirement plan 148 227 148 227 1,290 1,763 1,290 1,751 2,236 2,769 2,236 2,749
Estimated monetary value of Directors’ benefi ts-in-kind – Executive 35 35 35 35 – Non-Executive 60 60 60 60 95 95 95 95
8. FINANCE COSTS
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Interest expense on: – revolving credit 1,018 956 1,011 490 – bank overdrafts 389 423 30 17 – term loan 5,527 6,473 3,778 3,778 – bridging loan 1,653 1,947 – – – fi nance lease 31 43 31 43 – advances from subsidiary companies – – 56 181 8,618 9,842 4,906 4,509 112 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
9. PROFIT BEFORE TAX The following amounts have been (credited)/charged in arriving at profi t before tax:
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Interest (income) from/reversal of: – short term deposits (740) (291) (64) (146) – subordinated bonds – (176) – (176) – advances to a jointly controlled entity (263) (196) (525) (393) – advances to subsidiary companies – – (6,166) (7,439) – amounts overdue from purchasers 956 (716) – – – others (634) (2,044) – – Gain on disposal of property, plant and equipment (36,459) (31) – (18) Rental income (3,587) (1,971) – – Write-back for penalty charges – (2,500) – – Direct operating expenses of investment properties: – revenue generating during the year 744 262 – – – non-revenue generating during the year 379 308 – – Guaranteed lease rental 1,662 1,406 – – Auditors’ remuneration Statutory audit 181 181 42 42 Non statutory audit fees: – tax advisory and compliance work 68 114 16 19 – other regulatory work 23 16 13 8 Loss on disposal of property, plant and equipment 99 – 99 – Negative goodwill – 4 – – Property, plant and equipment written off 1 4 – – Write-down of completed properties 539 – – –
10. TAX EXPENSE
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Current tax: – Malaysian tax 6,536 5,504 13,363 4,288 Deferred tax (Note 20) (1,087) (3,661) 227 (8) 5,449 1,843 13,590 4,280
Current tax Current fi nancial year 8,027 5,603 13,935 4,288 Overaccrual in prior fi nancial years (net) (1,491) (99) (572) – 6,536 5,504 13,363 4,288 UNITED MALAYAN LAND BHD (4131-M) 113
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
10. TAX EXPENSE (CONT’D.)
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Deferred tax Origination and reversal of temporary differences (1,537) (3,426) 227 14 Under/(over)accrual in prior fi nancial years (net) 450 (41) – (37) Change in income tax rate – (194) – 15 (1,087) (3,661) 227 (8) 5,449 1,843 13,590 4,280
The numerical reconciliation between the average effective tax rate of the Group and Company and the Malaysian tax rate is as follows:
Group Company 2009 2008 2009 2008 % % % %
Malaysian tax rate 25 26 25 26 Tax effects of: – expenses not deductible for tax purposes 4 282 2 8 – income not subject to tax (15) (7) (3) (4) – current year’s tax loss not recognised 1 68 – – – lower tax rate resulting from restatement of land costs for tax purposes (5) (193) – – – utilisation of previously unrecognised tax losses (1) – – – – utilisation of previously unrecognised timing differences – 2 – – – share of results of jointly controlled entities – 14 – – – group tax relief – – (1) (4) – overaccrual of current tax in prior fi nancial years (2) (17) (1) – – under/(over)accrual of deferred tax in prior fi nancial years 1 (7) – – – change in income tax rate – (42) – – – others 1 194 – – Average effective tax rate 9 320 22 26
Included in tax expense of the Group are tax savings from utilisation of current fi nancial year’s tax losses of subsidiary companies amounting to RM1,133,000 (2008: RM733,000). 114 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
11 . EARNINGS/(LOSS) AND NET ASSETS PER SHARE (a) Earnings/(loss) per share (“EPS”) Basic EPS Basic EPS of the Group is calculated by dividing the profi t/(loss) attributable to equity holders of the Company for the fi nancial year by the weighted average number of ordinary shares in issue during the fi nancial year, excluding ordinary shares acquired by the Company and held as treasury shares.
2009 2008
Profi t/(loss) attributable to equity holders of the Company for the fi nancial year (RM’000) 55,035 (3,462) Weighted average number of ordinary shares in issue (‘000) 241,303 241,303 Basic EPS (sen) 22.81 (1.43)
Diluted EPS For the diluted EPS calculation, the weighted average number of ordinary shares in issue is adjusted to assume conversion of all dilutive potential ordinary shares. The Group does not have any dilutive potential ordinary shares. Accordingly, diluted earnings per share information is not presented in the fi nancial statements.
(b) Net assets per share attributable to equity holders of the Company The net assets per share attributable to equity holders of the Company is calculated by dividing the capital and reserves attributable to equity holders of the Company of RM857,849,748 (2008: RM816,388,192) at the end of the fi nancial year by the issued share capital of 241,303,433 shares, (which is net of 401,800 treasury shares) (2008: 241,303,433 shares, (which is net of 401,800 treasury shares)) of the Company at the end of the fi nancial year.
12. DIVIDEND PER SHARE Dividends declared and proposed for the fi nancial year are as follows:
2009 2008 Gross Gross dividend Amount of dividend Amount of per share net dividend per share net dividend Sen RM’000 Sen RM’000
Final dividend paid, less income tax of 25% – – 2.50 4,525 Interim dividend paid, less income tax of 25% 2.50 4,524 – – Interim dividend declared and payable, less income tax of 25% 2.50 4,525 – – Proposed fi nal dividend, less income tax of 25% 4.06 7,348 – – Proposed fi nal dividend, tax-exempt 0.70 1,689 – – 9.76 18,086 2.50 4,525 UNITED MALAYAN LAND BHD (4131-M) 115
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
12. DIVIDEND PER SHARE (CONT’D.) At the forthcoming Annual General Meeting (“AGM”) on 23 June 2010, a fi nal dividend of 4.06 sen (2008: 2.50 sen) gross per ordinary share, less income tax of 25% and 0.70 sen gross per ordinary share, tax-exempt, on 241,303,433 ordinary shares (which is net of 401,800 treasury shares) in respect of the fi nancial year ended 31 December 2009 will be proposed for shareholders’ approval. This fi nal net dividend amounts to RM9,036,814.
These fi nancial statements do not refl ect this fi nal dividend as a liability. The fi nal dividend will be accrued as a liability only after it has been approved by the shareholders at the forthcoming AGM.
13. PROPERTY, PLANT AND EQUIPMENT
As at Disposals/ As at 1.1.2009 Additions write-off Transfers 31.12.2009 RM’000 RM’000 RM’000 RM’000 RM’000
Group 2009 Cost/Valuation Freehold land 320,737 1,183 (36,200) (8,923) 276,797 Buildings 11,868 – (8,034) (3,251) 583 Building under construction – 868 – – 868 Furniture, fi ttings and equipment 7,915 221 (887) – 7,249 Motor vehicles 3,123 142 (455) – 2,810 Stable and equestrian equipment 97 – (41) – 56 343,740 2,414 (45,617) (12,174) 288,363
Charge for As at the fi nancial Disposals/ As at 1.1.2009 year write-off Transfers 31.12.2009 RM’000 RM’000 RM’000 RM’000 RM’000
Accumulated depreciation Freehold land – – – – – Buildings 6,682 110 (4,977) (1,751) 64 Building under construction – – – – – Furniture, fi ttings and equipment 6,638 560 (825) – 6,373 Motor vehicles 1,413 321 (254) – 1,480 Stable and equestrian equipment 97 – (41) – 56 14,830 991 (6,097) (1,751) 7,973 116 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
13. PROPERTY, PLANT AND EQUIPMENT (CONT’D.)
As at Disposals/ As at 1.1.2008 Additions write-off Transfers 31.12.2008 RM’000 RM’000 RM’000 RM’000 RM’000
Group 2008 Cost/Valuation Freehold land 327,617 – – (6,880) 320,737 Buildings 17,045 43 – (5,220) 11,868 Furniture, fi ttings and equipment 7,624 469 (178) – 7,915 Motor vehicles 3,104 341 (322) – 3,123 Plant and machinery 20 – (20) – – Stable and equestrian equipment 97 – – – 97 355,507 853 (520) (12,100) 343,740
Charge for As at the fi nancial Disposals/ As at 1.1.2008 year write-off Transfers 31.12.2008 RM’000 RM’000 RM’000 RM’000 RM’000
Accumulated depreciation Freehold land – – – – – Buildings 8,437 850 – (2,605) 6,682 Furniture, fi ttings and equipment 6,249 563 (174) – 6,638 Motor vehicles 1,271 320 (178) – 1,413 Plant and machinery 20 – (20) – – Stable and equestrian equipment 97 – – – 97 16,074 1,733 (372) (2,605) 14,830
As at As at 31.12.2009 31.12.2008 RM’000 RM’000
Net book value Freehold land 276,797 320,737 Buildings 519 5,186 Building under construction 868 – Furniture, fi ttings and equipment 876 1,277 Motor vehicles 1,330 1,710 Plant and machinery – – Stable and equestrian equipment – – 280,390 328,910 UNITED MALAYAN LAND BHD (4131-M) 117
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
13. PROPERTY, PLANT AND EQUIPMENT (CONT’D.) The net book values of freehold land and buildings transferred from/(to) during the fi nancial year are as follows:
2009 2008 RM’000 RM’000
Freehold land Transfer to investment properties (Note 14) (5,816) (6,880) Transfer to land held for property development (Note 18) (2,211) – Transfer to property development costs (Note 22) (896) – (8,923) (6,880)
Buildings Transfer to investment properties (Note 14) (1,500) (3,180) Transfer from completed properties – 565 (1,500) (2,615) (10,423) (9,495)
As at As at 1.1.2009 Additions Disposal 31.12.2009 RM’000 RM’000 RM’000 RM’000
Company 2009 Cost Furniture, fi ttings and equipment 1,424 45 – 1,469 Motor vehicles 2,584 – (455) 2,129 4,008 45 (455) 3,598
Charge for As at the fi nancial As at 1.1.2009 year Disposal 31.12.2009 RM’000 RM’000 RM’000 RM’000
Accumulated depreciation Furniture, fi ttings and equipment 1,049 166 – 1,215 Motor vehicles 932 273 (254) 951 1,981 439 (254) 2,166 118 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
13. PROPERTY, PLANT AND EQUIPMENT (CONT’D.)
As at As at 1.1.2008 Additions Disposal 31.12.2008 RM’000 RM’000 RM’000 RM’000
Company 2008 Cost Furniture, fi ttings and equipment 1,316 108 – 1,424 Motor vehicles 2,523 327 (266) 2,584 3,839 435 (266) 4,008
Charge for As at the fi nancial As at 1.1.2008 year Disposal 31.12.2008 RM’000 RM’000 RM’000 RM’000
Accumulated depreciation Furniture, fi ttings and equipment 888 161 – 1,049 Motor vehicles 753 301 (122) 932 1,641 462 (122) 1,981
As at As at 31.12.2009 31.12.2008 RM’000 RM’000
Net book value Furniture, fi ttings and equipment 254 375 Motor vehicles 1,178 1,652 1,432 2,027
The freehold land of the Group was revalued by the Directors in 1990 based on a valuation carried out by an independent fi rm of professional valuers using the comparison method basis. The book value of freehold land was adjusted to refl ect the revaluation and the revaluation surplus arising thereof was credited to revaluation reserves.
A certain portion of the freehold land of the Group was revalued again by the Directors in 1996 based on a valuation carried out by an independent fi rm of professional valuers using the open market valuation basis. The book value of freehold land was adjusted to refl ect the revaluation and the revaluation surplus arising thereof was credited to revaluation reserves. UNITED MALAYAN LAND BHD (4131-M) 119
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
13. PROPERTY, PLANT AND EQUIPMENT (CONT’D.)
Group 2009 2008 RM’000 RM’000
The freehold land consists of the following: At cost or valuation Land, at 1990 valuation 17,201 19,113 Land, at 1996 valuation 254,898 297,978 Development expenditures, at cost 4,698 3,646 276,797 320,737
If the freehold land had been determined in accordance with the historical cost convention, the cost of the freehold land for the Group is RM12,439,658 (2008: RM14,815,583).
The net book value of property, plant and equipment pledged as security for borrowings are as follows:
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Freehold land 1,240 – – – Building under construction 868 – – – Motor vehicles 759 947 759 947 Total (Note 28) 2,867 947 759 947
14. INVESTMENT PROPERTIES Group 2009 2008 RM’000 RM’000
Net book value At beginning of the fi nancial year 17,258 6,843 Transfer from property, plant and equipment (Note 13) 7,316 10,060 Transfer from completed properties 26,183 – Transfer from property development costs (Note 22) 6,361 463 Additional costs incurred 227 – Depreciation (492) (108) At end of the fi nancial year 56,853 17,258
Cost 61,809 19,971 Accumulated depreciation (4,956) (2,713) Net book value 56,853 17,258 120 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
14. INVESTMENT PROPERTIES (CONT’D.) The fair value of the properties was estimated at RM106,127,000 (2008: RM38,740,000) based on valuation by independent professionally qualifi ed valuers and internal valuation. Valuations were based on current prices in an active market for all properties.
Investment properties with book value of RM6,823,754 (2008: RM462,635) have been pledged as security for borrowings (Note 28).
15. INVESTMENTS IN SUBSIDIARY COMPANIES
Company 2009 2008 RM’000 RM’000
Unquoted shares, at cost 534,792 451,530
Details of the subsidiary companies, all of which were incorporated in Malaysia, are as follows:
Group’s effective interest Name of company Principal activities 2009 2008 % %
@ Seri Alam Properties Sdn Bhd Property development 100 100
* UM Leisure Sdn Bhd General trading 100 100
UM Land Assets Sdn Bhd Property investment 100 100
UM Land Bena Sdn Bhd Property development and related activities 100 100
Country Equity Sdn Bhd Investment holding 100 100
UM Development Sdn Bhd Property development and related activities 100 100
UM Residences Sdn Bhd Development of serviced apartments 100 100
Suasana Sentral Two Sdn Bhd Property development and related activities 70 70
Dynasty View Sdn Bhd Property development and related activities 100 100
Exquisite Skyline Sdn Bhd Property development and related activities 71 71
^ Exquisite Mode Sdn Bhd Property development and related activities 100 100
* Clear Dynamic Sdn Bhd Property development and related activities 100 100
^ Extreme Consolidated Sdn Bhd Property development and related activities 51 100 UNITED MALAYAN LAND BHD (4131-M) 121
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
15. INVESTMENTS IN SUBSIDIARY COMPANIES (CONT’D.)
Group’s effective interest Name of company Principal activities 2009 2008 % %
+ Bangi Heights Development Sdn Bhd Property development and property investment 70 –
Subsidiary companies of Seri Alam Properties Sdn Bhd * PMS Services Sdn Bhd Project management 100 100
* Seri Alam Hotel Resort Sdn Bhd General trading 100 100
Seri Alam Leisure Sdn Bhd Investment holding 100 100
Subsidiary company of Seri Alam Leisure Sdn Bhd # Seri Alam Golf & Equestrian Club Sdn Bhd Operation of a recreational club and related activities 100 100
Subsidiary company of Country Equity Sdn Bhd + Bangi Heights Development Sdn Bhd. Property development and property investment – 70
Subsidiary company of UM Land Assets Sdn Bhd Ipjora Holdings Sdn Bhd Developing, building, owning and operating serviced apartments 100 100
@ Subsidiary company consolidated using the merger method of accounting. * These subsidiary companies have not commenced operations. # This subsidiary company has ceased operations.
^ During the fi nancial year, the paid-up share capital of these subsidiaries was increased as follows:
Increased As at during the As at 1.1.2009 fi nancial year 31.12.2009 RM RM RM
Exquisite Mode Sdn Bhd 100,000 400,000 500,000 Extreme Consolidated Sdn Bhd 2 98 100 122 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
15. INVESTMENTS IN SUBSIDIARY COMPANIES (CONT’D.)
On 12 February 2009, the Company had entered into a conditional subscription and joint venture agreement (“JVA”) with Tradewinds Johor Sdn Bhd (“TJSB”), to govern a joint venture company, Extreme Consolidated Sdn Bhd (“ECSB”). ECSB was a wholly-owned subsidiary of the Company with an issued and fully paid-up share capital of 2 ordinary shares of RM1.00 each.
Pursuant to the JVA, the Company and TJSB will each subscribe for 49 new ordinary shares of RM1.00 in ECSB for a cash consideration of RM49.00 in order that the shareholding proportion in ECSB is 51:49 respectively. The JVA was completed upon the subscription for 49 new ordinary shares of RM1.00 each for a cash consideration of RM49.00 each by the Company and TJSB respectively in ECSB on 21 October 2009.
+ On 20 January 2009, the Company had entered into a conditional share sale and purchase agreement (“SSA”) with Country Equity Sdn Bhd (“CESB”), a wholly-owned subsidiary of the Company, for the acquisition of 70,000,000 ordinary shares of RM1.00 each and 14,000,000 cumulative redeemable preference shares of RM1.00 each in Bangi Heights Development Sdn Bhd (“BHD”), representing 70% of the issued and paid-up share capital of BHD for a total cash consideration of RM82.86 million (“Shareholding Rationalisation”).
Pursuant to the Shareholding Rationalisation, the Company would directly own 70% of the issued and paid-up share capital of BHD instead of through CESB and hence, would have obtained direct control in BHD. The Shareholding Rationalisation was completed on 1 April 2009 in accordance with the SSA.
Acquisition of a subsidiary company in the fi nancial year ended 31 December 2008 On 1 December 2008, UM Land Assets Sdn Bhd (“UMLA”), a wholly-owned subsidiary of the Company acquired 3,600,000 ordinary shares of RM1.00 each and 36,000 cumulative redeemable preference shares of RM1.00 each representing 60% of the entire issued and paid-up share capital of Ipjora Holdings Sdn Bhd (“Ipjora”) for a cash consideration of RM5,309,882. UMLA owned 40% equity interest in Ipjora prior to this acquisition.
For the month of December 2008, the acquired subsidiary company contributed loss for the fi nancial year of RM25,455 to the Group’s results. If the acquisition had occurred on 1 January 2008, the Group’s loss for the fi nancial year ended 31 December 2008 would have been RM3,454,861.
The assets and liabilities arising from the acquisition were as follows:
Fair value Acquiree’s recognised carrying on acquisition amount RM’000 RM’000
Identifi able assets and liabilities Land held for property development 5,400 4,800 Tax recoverable 2 2 Trade and other receivables 14 14 Cash and bank balances 66 66 Total assets 5,482 4,882
Other payables (168) (168) Total liabilities (168) (168)
Identifi able net assets acquired 5,314 4,714 Negative goodwill (4) Cost of acquisition 5,310 UNITED MALAYAN LAND BHD (4131-M) 123
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
15. INVESTMENTS IN SUBSIDIARY COMPANIES (CONT’D.) The effects of the acquisition on the cash fl ows of the Group for the fi nancial year ended 31 December 2008 were as follows:
RM’000
Purchase consideration satisfi ed by cash 5,310 Less: Cash and cash equivalents in the subsidiary company acquired (111) Net cash outfl ow of the Group 5,199
16. INVESTMENTS IN JOINTLY CONTROLLED ENTITIES
2009 2008 RM’000 RM’000
Group Share of net assets of jointly controlled entities 20,502 19,799
Company Unquoted shares, at cost 20,000 20,000
The summarised fi nancial information of the jointly controlled entities is as follows:
2009 2008 RM’000 RM’000
Results Revenue 7,858 7,764 Profi t/(loss) after tax 2,307 (639)
Assets and liabilities Non-current assets 195 186 Current assets 140,587 131,762 Current liabilities (24,775) (92,361) Non-current liabilities (75,015) (1) Net assets 40,992 39,586 124 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
16. INVESTMENTS IN JOINTLY CONTROLLED ENTITIES (CONT’D.)
Details of the jointly controlled entities, all of which were incorporated in Malaysia, are as follows:
Group’s effective interest Name of company Principal activities 2009 2008 % %
Alpine Return Sdn Bhd Property development and related activities 50 50
Nusajaya Consolidated Sdn Bhd Property development and related activities 50 –
SSBC Sdn Bhd Letting and marketing Somerset Seri Bukit Ceylon serviced residences 50.533 50.533
On 14 October 2008, the Company had entered into a conditional subscription and joint venture agreement (“SJVA”) with UEM Land Berhad (“UEML”) to govern a joint venture company, Nusajaya Consolidated Sdn Bhd (“NCSB”) for the proposed development of two pieces of land located in Mukim Pulai, District of Johor Bahru, State of Johor Darul Ta’zim.
Pursuant to the SJVA, the Company will subscribe new shares in NCSB for a cash consideration of RM2.00 comprising 2 ordinary shares of RM1.00 each. The Company and UEML will each own 50% of the issued and paid-up share capital of NCSB. The subscription of shares in NCSB by the Company was completed on 2 April 2009.
17. OTHER INVESTMENTS
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Unquoted shares, at cost – 9 – –
Unquoted subordinated bonds, at cost 6,000 6,000 6,000 6,000 Less: Accumulated impairment loss (6,000) (2,901) (6,000) (2,901)
– 3,099 – 3,099 – 3,108 – 3,099
The fair value of the unquoted bonds as at the fi nancial year end approximates the carrying amount. UNITED MALAYAN LAND BHD (4131-M) 125
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
18 . LAND HELD FOR PROPERTY DEVELOPMENT
Group 2009 2008 RM’000 RM’000
At beginning of the fi nancial year 172,974 163,974 Acquisition of a subsidiary company (Note 15) – 9,000 Transfer from property, plant and equipment (Note 13) 2,211 – Transfer from property development costs (Note 22) 19,515 – At end of the fi nancial year 194,700 172,974
Land held for property development with book value of RM141,937,472 (2008: RM142,058,880) have been pledged as security for borrowings (Note 28).
The fair value of the land held for property development recognised from the acquisition of a subsidiary company in the fi nancial year ended 31 December 2008 was RM9,000,000.
19 . LONG TERM TRADE RECEIVABLE
Group 2009 2008 RM’000 RM’000
Current 217 –
Later than 1 year and not later than 2 years 269 – Later than 2 years and not later than 5 years 593 –
Non-current 862 – 1,079 –
Long term trade receivable is the discounted future receipts arising from the sale of a land parcel under a deferred payment scheme. Proceeds from the sale of land under the deferred payment scheme are receivable over three years. The instalments receivable within twelve months amounting to RM216,678 are included in “Trade and other receivables” in current assets. 126 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
20 . DEFERRED TAX Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when the deferred taxes relate to the same tax authority. The following amounts, determined after appropriate offsetting, are shown in the balance sheet:
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Deferred tax assets: – subject to income tax 8,378 6,629 143 370 – subject to real property gains tax (“RPGT”) 9,274 9,893 – –
17,652 16,522 143 370
Deferred tax liabilities: – subject to income tax (10,871) (10,828) – – 6,781 5,694 143 370
At beginning of the fi nancial year: 5,694 2,033 370 362
Credited/(charged) to income statement (Note 10): – property, plant and equipment (1) 13 19 (1) – land held for property development 179 47 – – – property development costs (424) 462 – – – interest capitalised 1,853 1,826 – – – receivables (654) 331 (214) (31) – payables 10 39 (32) 40 – tax losses 124 943 – – 1,087 3,661 (227) 8 At end of the fi nancial year 6,781 5,694 143 370
Subject to income tax: Deferred tax assets (before offsetting): – property, plant and equipment 39 71 – – – property development costs – 2 – – – interest capitalised 6,982 5,129 – – – receivables 356 796 74 74 – payables 752 742 340 372 – tax losses 1,078 954 – – 9,207 7,694 414 446 Offsetting (829) (1,065) (271) (76) Deferred tax assets (after offsetting) 8,378 6,629 143 370 UNITED MALAYAN LAND BHD (4131-M) 127
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
20 . DEFERRED TAX (CONT’D.)
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Deferred tax liabilities (before offsetting): – property, plant and equipment (94) (125) (57) (76) – land held for property development (9,126) (9,305) – – – property development costs (2,192) (2,389) – – – interest capitalised (74) (74) – – – receivables (214) – (214) – (11,700) (11,893) (271) (76) Offsetting 829 1,065 271 76 Deferred tax liabilities (after offsetting) (10,871) (10,828) – –
Subject to RPGT: Deferred tax assets: – property development costs 9,274 9,893 – –
The amount of unused tax losses (with no expiry date) for which no deferred tax asset is recognised in the balance sheet is as follows:
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Tax losses 99,895 99,203 – –
21 . COMPLETED PROPERTIES Completed properties with book value of RM27,671,525 (2008: RM25,911,545) have been pledged as security for borrowings (Note 28). 128 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
22 . PROPERTY DEVELOPMENT COSTS
Group 2009 2008 RM’000 RM’000
At beginning of the fi nancial year Freehold land – at cost 103,616 100,176 – at valuation 52,386 56,445 Development costs incurred 306,399 425,828 Accumulated costs charged to income statement (70,251) (261,547) 392,150 320,902
Costs incurred during the fi nancial year Acquisition of land – 47,000 Development costs incurred 103,682 112,192 Transfer from property, plant and equipment (Note 13) 896 – Transfer to investment properties (Note 14) (6,361) (463) Transfer to land held for property development (Note 18) (19,515) – Transfer to completed properties (22,766) (11,397) Accumulated costs charged to income statement (104,895) (76,084) (48,959) 71,248
At end of the fi nancial year Freehold land – at cost 98,568 103,616 – at valuation 28,558 52,386 Development costs incurred 327,833 306,399 Accumulated costs charged to income statement (111,768) (70,251) 343,191 392,150
The freehold land at valuation was transferred from “Property, plant and equipment” to “Property development costs” at its carrying amounts. The Directors have applied the transitional provision issued by MASB on adoption of FRS 116 “Property, Plant and Equipment”, which allows these assets to be stated at their 1990 and 1996 valuations. Accordingly, the carrying amounts have not been updated.
Included in the development costs incurred during the fi nancial year is interest capitalised amounting to RM1,738,162 (2008: RM3,387,353).
Property development costs with book value of RM133,418,848 (2008: RM152,033,090) have been pledged as security for borrowings (Note 28). UNITED MALAYAN LAND BHD (4131-M) 129
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
23 . TRADE AND OTHER RECEIVABLES
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Trade receivables Third parties 36,811 77,210 297 297 Related parties: – Persons/companies related to Directors 967 304 – – Accrued billings in respect of property development 56,093 23,164 – – Accrued rental income from investment properties 1,772 1,615 – – 95,643 102,293 297 297
Less: Allowance for doubtful debts Third parties (7,140) (10,821) (297) (297) Related parties: – Company related to Directors (80) – – – (7,220) (10,821) (297) (297)
Trade receivables, net 88,423 91,472 – –
Other receivables Other receivables 64,885 6,644 47 280 Less: Allowance for doubtful debts (782) (603) – – 64,103 6,041 47 280
Amounts due from related parties: – Subsidiary companies – – 136,792 212,320 – Jointly controlled entities 11,705 5,423 11,794 5,550 – Related companies 6 6 4 4 11,711 5,429 148,590 217,874 Deposits 4,290 4,278 228 216 Prepayments 462 673 409 652 16,463 10,380 149,227 218,742 Total 168,989 107,893 149,274 219,022 130 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
23. TRADE AND OTHER RECEIVABLES (CONT’D.) (a) Amount due from related parties (Trade receivables) All amounts due from related parties are unsecured, non-interest bearing, repayable on demand and are to be settled in cash.
(b) Amounts due from related parties (Other receivables) Amounts due from subsidiary companies bear interest ranging from 6.55% to 7.55% (2008: 7.50% to 8.50%) per annum as at fi nancial year end. Amount due from a jointly controlled entity bears interest of 6.55% (2008: 7.50%) per annum as at fi nancial year end. Other amounts due from related parties are non-interest bearing. All amounts due from related parties receivable are unsecured, repayable on demand and are to be settled in cash.
24. DEPOSITS, BANK AND CASH BALANCES
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Bank and cash balances 3,711 9,787 732 1,808 Bank balances under Housing Development Accounts (“HDA”) 15,874 29,240 – – Bank balances under sinking fund 1,252 1,215 – – Fixed deposits 24,755 63,505 – – Short term money market deposits 17,350 20,000 3,000 – 62,942 123,747 3,732 1,808
The effective weighted average interest rates of deposits and bank balances as at the balance sheet dates were as follows:
Group Company 2009 2008 2009 2008 % p.a. % p.a. % p.a. % p.a.
Bank balances 0.05 0.08 0.28 1.25 Bank balances under HDA 1.00 2.02 – – Bank balances under sinking fund 1.45 3.00 – – Fixed deposits 2.00 3.14 – – Short term money market deposits 1.64 2.80 1.75 –
Bank balances are deposits held at call with banks.
The fi xed deposits of the Group have maturity periods ranging from one month to three months. Short term money market deposits are deposits with banks with maturity period of less than one month.
The subsidiary companies’ bank balances under Housing Development Accounts are not freely remissible to the Company until the issuance of the Certifi cate of Fitness for the respective housing developments and with the approval of the Controller of Housing after deducting certain sums of monies as specifi ed in Housing Development (Control and Licensing) Act 1966, Housing Developers (Housing Development Account)(Amendment) Regulations 2002, Regulation 9.
The sinking fund, which is established in accordance with the terms stipulated in the loan agreement, represents deposits with a bank which will be utilised for the repayment of term loan and bridging loan of a subsidiary company. UNITED MALAYAN LAND BHD (4131-M) 131
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
25 . SHARE CAPITAL
Group and Company 2009 2008 RM’000 RM’000
Authorised: Ordinary shares of RM1.00 each, at beginning and end of the fi nancial year 500,000 500,000
Issued and fully paid: Ordinary shares of RM1.00 each: At beginning of the fi nancial year 241,705 241,650 Issued during the fi nancial year pursuant to ESOS – 55 At end of the fi nancial year 241,705 241,705
(a) EMPLOYEES’ SHARE OPTION SCHEME (“ESOS”) The Company’s ESOS was governed by the by-laws approved by the shareholders at an Extraordinary General Meeting (“EGM”) held on 25 June 2003. The ESOS was implemented on 4 September 2003 and was to be in force for a period of 5 years from the date of implementation.
The existing by-laws of the ESOS were amended to effect certain amendments to the material terms of the by-laws and also to allow the Non-Executive Directors to participate in the ESOS. The amendments to the existing ESOS by-laws and granting of options over ordinary shares to Non-Executive Directors were approved by the shareholders at an EGM held on 20 June 2006.
The ESOS had expired on 3 September 2008.
During the fi nancial year ended 31 December 2008, 55,500 new ordinary shares of RM1.00 each were issued by the Company at exercise prices ranging from RM1.31 to RM1.61 per share for cash by virtue of the exercise of options over ordinary shares pursuant to the Company’s ESOS. The new shares issued ranked pari passu in all respects with the existing ordinary shares of the Company.
The movements during the fi nancial year ended 31 December 2008 in the number of options over ordinary shares of the Company were as follows:
Exercise price/ As at As at Grant date Expiry date share 1.1.2008 Granted Exercised Lapsed 31.12.2008 RM ‘000 ‘000 ‘000 ‘000 ‘000
5.9.2003 3.9.2008 1.31 178 – (52) (126) – 10.4.2007 3.9.2008 1.61 172 – (3) (169) – 3.12.2007 3.9.2008 1.99 1,268 – – (1,268) – 1,618 – (55) (1,563) – 132 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
25 . SHARE CAPITAL (CONT’D.)
(b) TREASURY SHARES In previous fi nancial years, the Company had cumulatively repurchased 401,800 of its issued ordinary shares from the open market on Bursa Malaysia Securities at the average price of RM1.14 per share. These repurchases were fi nanced by internally generated funds. These shares repurchased are being held as treasury shares as allowed under Section 67A of Companies Act, 1965. None of these treasury shares has been sold or cancelled.
As at 31 December 2009, the number of outstanding shares in issue which are fully paid is 241,303,433 (net of 401,800 treasury shares) (2008: 241,303,433 (net of 401,800 treasury shares)) ordinary shares of RM1.00 each.
26 . RESERVES
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Non-distributable Share premium 63,971 63,971 63,971 63,971 Revaluation reserves 209,421 243,018 – – Merger reserve^ – – 209,375 209,375 273,392 306,989 273,346 273,346 Capital reserves: – Merger defi cit # (41,625) (41,625) – – Treasury shares (Note 25) (463) (463) (463) (463) 231,304 264,901 272,883 272,883
Distributable Retained earnings 278,142 236,681 87,616 53,292 Revaluation reserves* 106,698 73,101 15,256 15,256 384,840 309,782 102,872 68,548 616,144 574,683 375,755 341,431
^ Merger reserve represents premium on the issue of shares for the acquisition of the entire shares in issue of a subsidiary company in accordance with Section 60(4) of Companies Act, 1965. # Merger defi cit represents the defi cit in the fair value of shares issued for the acquisition of the entire equity interest of a subsidiary company against the total value of net assets acquired in accordance with Section 60(4) of Companies Act, 1965. * This represents the accumulated revaluation reserves which have already been realised. UNITED MALAYAN LAND BHD (4131-M) 133
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
27 . LONG TERM TRADE PAYABLE
Group 2009 2008 RM’000 RM’000
Current – 3,000
Later than 1 year and not later than 2 years – 4,000 Later than 2 years and not later than 5 years – 10,000
– 14,000 – 17,000
Long term trade payable as at 31 December 2008 was the consideration payable to a land owner for granting the exclusive right to a subsidiary company to develop and selling of serviced residences. On 31 December 2009, the Group made full settlement for the consideration of RM17,000,000, in exchange for the entire development rights and transfer of the land to the subsidiary company.
The fair value of this long term trade payable as at 31 December 2008 was RM12,384,756. The fair value was estimated based on future contractual cash fl ows discounted at the interest rates ranging from 4.55% to 4.65% per annum.
28 . BORROWINGS
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Non-current Secured Bridging loan 24,669 34,904 – – Term loan 16,800 39,200 – – Finance lease liabilities 292 564 292 564 41,761 74,668 292 564 Unsecured Term loan 40,000 60,000 40,000 60,000 81,761 134,668 40,292 60,564 134 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
28 . BORROWINGS (CONT’D.)
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Current Secured Bank overdrafts 9,550 10,049 – – Revolving credit – 44,000 – – Bridging loan 15,000 6,563 – – Term loan 37,216 28,344 – – Finance lease liabilities 272 260 272 260 62,038 89,216 272 260 Unsecured Bank overdrafts – 4,949 – 4,949 Revolving credit 23,000 45,500 23,000 45,500 Term loan 20,000 – 20,000 – 105,038 139,665 43,272 50,709
Total Bank overdrafts 9,550 14,998 – 4,949 Revolving credit 23,000 89,500 23,000 45,500 Bridging loan 39,669 41,467 – – Term loan 114,016 127,544 60,000 60,000 Finance lease liabilities 564 824 564 824 186,799 274,333 83,564 111,273
The borrowings are secured by the following:
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Property, plant and equipment (Note 13) 2,867 947 759 947 Investment properties (Note 14) 6,824 463 – – Land held for property development (Note 18) 141,937 142,059 – – Completed properties (Note 21) 27,672 25,912 – – Property development costs (Note 22) 133,419 152,033 – – 312,719 321,414 759 947 UNITED MALAYAN LAND BHD (4131-M) 135
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
28. BORROWINGS (CONT’D.)
Weighted average Total Maturity profi le interest rate carrying at balance sheet date amount < 1 year 1-5 years % p.a. RM’000 RM’000 RM’000
Group 2009 Bank overdrafts 6.55 9,550 9,550 – Revolving credit 3.96 23,000 23,000 – Term loan 4.28 37,216 37,216 – Bridging loan 4.11 39,669 15,000 24,669 Term loan 4.36 16,800 – 16,800 Term loan 6.30 60,000 20,000 40,000 Finance lease liabilities 4.43 564 272 292 186,799 105,038 81,761
2008 Bank overdrafts 7.50 14,998 14,998 – Revolving credit 5.27 89,500 89,500 – Term loan 5.26 28,344 28,344 – Bridging loan 5.32 41,467 6,563 34,904 Term loan 5.57 39,200 – 39,200 Term loan 6.30 60,000 – 60,000 Finance lease liabilities 4.45 824 260 564 274,333 139,665 134,668
Company 2009 Revolving credit 3.96 23,000 23,000 – Term loan 6.30 60,000 20,000 40,000 Finance lease liabilities 4.43 564 272 292 83,564 43,272 40,292
2008 Bank overdrafts 7.50 4,949 4,949 – Revolving credit 5.11 45,500 45,500 – Term loan 6.30 60,000 – 60,000 Finance lease liabilities 4.45 824 260 564 111,273 50,709 60,564 136 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
28. BORROWINGS (CONT’D.) The net exposure of borrowings of the Group and Company to interest rate changes and the periods in which the borrowings reprice are as follows:
Weighted average Total Floating Fixed interest rate carrying interest rate interest rate at balance sheet date amount < 1 year 1-5 years % p.a. RM’000 RM’000 RM’000
Group 2009 Bank overdrafts 6.55 9,550 9,550 – Revolving credit 3.96 23,000 23,000 – Term loan 4.28 37,216 37,216 – Bridging loan 4.11 39,669 39,669 – Term loan 4.36 16,800 16,800 – Term loan 6.30 60,000 – 60,000 Finance lease liabilities 4.43 564 – 564 186,799 126,235 60,564
2008 Bank overdrafts 7.50 14,998 14,998 – Revolving credit 5.27 89,500 89,500 – Term loan 5.26 28,344 28,344 – Bridging loan 5.32 41,467 41,467 – Term loan 5.57 39,200 39,200 – Term loan 6.30 60,000 – 60,000 Finance lease liabilities 4.45 824 – 824 274,333 213,509 60,824
Company 2009 Revolving credit 3.96 23,000 23,000 – Term loan 6.30 60,000 – 60,000 Finance lease liabilities 4.43 564 – 564 83,564 23,000 60,564
2008 Bank overdrafts 7.50 4,949 4,949 – Revolving credit 5.11 45,500 45,500 – Term loan 6.30 60,000 – 60,000 Finance lease liabilities 4.45 824 – 824 111,273 50,449 60,824 UNITED MALAYAN LAND BHD (4131-M) 137
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
28. BORROWINGS (CONT’D.) (a) Unsecured term loan of RM20 million represents primary collateralised loan obligation entered by the Company in 2005. The term loan is subject to fi xed interest rate of 6.13% per annum and is repayable in one lump sum in September 2010. The fair value of this long term loan as at the balance sheet date is RM20,000,000 (2008: RM20,597,628). The fair value as at 31 December 2009 approximates its carrying amount. The fair value as at 31 December 2008 was estimated based on future contractual cash fl ows discounted at the interest rate of 4.55% per annum.
(b) Unsecured term loan of RM40 million represents primary collateralised loan obligation entered by the Company in 2007. The term loan is subject to fi xed interest rate of 6.38% per annum and is repayable in one lump sum in January 2012. The fair value of this long term loan as at the balance sheet date is RM41,520,005 (2008: RM42,211,596). The fair value is estimated based on future contractual cash fl ows discounted at the interest rate of 4.75% (2008: 4.65%) per annum.
(c) The fair value of the non-current fi nance lease liabilities as at the balance sheet date is RM278,966 (2008: RM538,817). The fair value is estimated based on future contractual cash fl ows discounted at the interest rates ranging from 4.17% to 4.88% (2008: 4.17% to 4.88%) per annum.
The carrying amount of all other borrowings of the Group and Company at the balance sheet dates approximates their fair values.
The minimum lease payments at the balance sheet dates are as follows:
Group and Company 2009 2008 RM’000 RM’000
Future minimum lease payments: Not later than 1 year 291 291 Later than 1 year and not later than 5 years 299 590 Total future minimum lease payments 590 881 Less: Future fi nance charges (26) (57) Present value of fi nance lease liabilities 564 824
Analysis of present value of fi nance lease liabilities Not later than 1 year 272 260 Later than 1 year and not later than 5 years 292 564 564 824 138 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
29 . TRADE AND OTHER PAYABLES
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Trade payables 25,367 35,734 – – Trade accruals 18,619 21,203 – – Amounts due to related parties: Subsidiary companies – – 2,818 1,064 Related companies 313 65 68 65 Payroll liabilities 3,862 3,938 1,434 1,742 Other payables and accruals 10,535 8,743 2,276 2,354 58,696 69,683 6,596 5,225
Credit terms of trade payables granted to the Group vary from no credit terms to 60 days.
Amounts due to subsidiary companies bear interest of 6.55% (2008: 5.45% to 7.50%) per annum as at fi nancial year end. Amounts due to related companies are non-interest bearing. All amounts due to related parties are unsecured, repayable on demand and are to be settled in cash.
30. PROVISION
Group 2009 2008 RM’000 RM’000
Infrastructure costs 9,611 – Property development costs 104 78 9,715 78
The provision for infrastructure costs represents the estimated infrastructure costs to be incurred as part of the obligation in accordance with the terms of the sale and purchase agreement of a disposal of a parcel of land in a subsidiary company.
The provision for property development costs represents development costs estimated to be incurred. This provision will be utilised when the designated development activities take place. The movements in the provision for development costs are as follow:
Group 2009 2008 RM’000 RM’000
At beginning of the fi nancial year 78 2,578 Additional provision 26 – Reversal of unutilised provision – (2,500) At end of the fi nancial year 104 78 UNITED MALAYAN LAND BHD (4131-M) 139
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
31 . RELATED PARTY TRANSACTIONS In addition to the related party disclosures mentioned elsewhere in the fi nancial statements, set out below are transactions with related parties during the fi nancial year:
Group Company 2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000
Transactions with subsidiary companies Dividend income – – 65,695 19,208 Expenses paid on behalf by subsidiary companies – – 2,405 254 Interest income – – 6,166 7,439 Interest expense – – 56 181 Payment made on behalf of subsidiary companies – – 36,112 67,209 Provision of management services – – 7,645 9,033
Transactions with jointly controlled entities Interest income 263 196 525 393 Rental income 1,207 1,199 – – Payment made on behalf of jointly controlled entities 5,719 3,310 5,719 3,310
Transactions with a corporate shareholder, Tradewinds Corporation Berhad and its related companies Purchase of goods and procurement of services 1,075 1,116 989 1,033
Transactions with a Director of the Company Progress billings for sale of properties – 192 – –
Transactions with persons/company related to Directors of the Company Progress billings for sale of properties 915 1,103 – – Rental income 9 12 – –
The amounts that remained outstanding as at 31 December 2009 in respect of the above transactions with related parties are shown in Notes 23 and 29 to the fi nancial statements. 140 UNITED MALAYAN LAND BHD (4131-M)
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2009
32. OPERATING LEASE COMMITMENT The Group as lessor The Group has entered into non-cancellable operating lease arrangements on its investment properties. The lease arrangements have a non-cancellable lease term of 30 years. Lease rental will revise upwards by 5% to 15% every 3 years period commencing from the rent commencement date. Upon expiration of the lease term, the lease shall be renewed for a term of 10 years and the rental rate shall be based on the prevailing market rate of similar leases or a similar type of lease in a similar location at the time of renewal.
The future minimum lease payments receivable under non-cancellable operating lease contracted for as at the balance sheet date but not recognised as receivables, are as follows:
Group 2009 2008 RM’000 RM’000
Not later than 1 year 922 922 Later than 1 year and not later than 5 years 3,864 3,804 Later than 5 years 27,446 28,428 32,232 33,154
33. SEGMENTAL INFORMATION The Group is primarily engaged in the property development industry (Primary segment). All activities of the Group are conducted within Malaysia (Secondary segment).
34. APPROVAL OF FINANCIAL STATEMENTS The fi nancial statements have been approved for issue in accordance with a resolution of the Board of Directors on 22 April 2010. UNITED MALAYAN LAND BHD (4131-M) 141
Other Information
List of Properties 142 Analysis of Shareholdings 145
Notice of 49th Annual General Meeting 148
Statement Accompanying Notice of 49th Annual General Meeting 152
Form of Proxy 142 UNITED MALAYAN LAND BHD (4131-M)
List of Properties AS AT 31 DECEMBER 2009
Description & Age of Net Book Date of Last Location Existing Use Tenure Buildings Land Area Value Revaluation Year Acre RM’000 TOWNSHIP DEVELOPMENT BANDAR SERI ALAM
Mukim of Plentong Vacant land Freehold – 199.43 – May-90/ District of Johor Bahru - Government reserve Oct-96
1 Jalan Purnama Equestrian clubhouse Freehold 12 63.35 9,995 Bandar Seri Alam 81750 Johor Darul Takzim
3 Jalan Persisiran Japanese school Freehold 12 5.01 7,222 Bandar Seri Alam 81750 Johor Darul Takzim
Oct-96 Mukim of Plentong Vacant development land Freehold – 445.11 267,229 District of Johor Bahru - Residential 254.02 216,160 - Commercial 2.96 3,846 - Recreational & others 7.71 902 - School & hostel 154.86 19,021 - Agriculture reserve 25.56 27,300
Mukim of Plentong Completed properties Freehold – 0.87 2,515 District of Johor Bahru - Residential
Jalan Suria 1 Corporate offi ce Freehold – 1.83 1,978 Bandar Seri Alam 81750 Johor Darul Takzim
Mukim of Plentong Vacant development land Freehold – 722.16 170,565 District of Johor Bahru - Residential 451.66 113,823 - Commercial 100.84 34,194 - Recreational & others 167.34 21,714 - School & hostel 2.32 834
Mukim of Plentong On-going development Freehold – 0.81 1,668 May-90 District of Johor Bahru - Commercial
Mukim of Plentong Completed properties Freehold – 9.67 12,849 District of Johor Bahru - Residential 8.12 10,284 - Commercial 1.55 2,565
Mukim of Plentong Investment properties Freehold 30.46 35,986 District of Johor Bahru - Land – 21.37 10,491 - Residential 2 - 12 8.97 25,205 - Commercial 11 0.12 290
Sub-Total 1,478.70 510,007 UNITED MALAYAN LAND BHD (4131-M) 143
List of Properties
AS AT 31 DECEMBER 2009
Description & Age of Net Book Date of Last Location Existing Use Tenure Buildings Land Area Value Revaluation Year Acre RM’000 BANDAR SERI PUTRA Mukim of Kajang Vacant land Freehold – 348.81 – District of Ulu Langat - Government reserve Selangor
34, Jalan Seri Putra 1/2 Corporate offi ce Freehold 8 0.09 513 Bandar Seri Putra, Bangi 43000 Kajang Selangor
Mukim of Kajang Vacant development land Freehold – 151.01 119,932 District of Ulu Langat - Residential 64.88 22,034 Selangor - Commercial 86.13 97,898
Mukim of Dengkil Vacant development land Freehold – 48.72 10,986 District of Sepang - Industrial Selangor Note
Mukim of Kajang On-going development Freehold – 5.41 900 District of Ulu Langat - Residential Selangor
Mukim of Kajang Completed properties Freehold – 3.45 1,868 District of Ulu Langat - Bungalow lots 2.13 185 Selangor - Residential 0.55 1,232 - Commercial 0.77 451
Pekan Bangi Lama Completed properties Freehold – 31.72 20,984 District of Ulu Langat - Bungalow lots Selangor
Sub-total 589.21 155,183
SERI AUSTIN Mukim of Tebrau Vacant land Freehold – 115.41 – District of Johor Bahru - Government reserve
Mukim of Tebrau Vacant development land Freehold – 212.26 116,671 District of Johor Bahru - Residential 202.82 110,972 - Commercial 9.44 5,699 Note
Mukim of Tebrau On-going development Freehold – 30.04 28,085 District of Johor Bahru - Residential
Mukim of Tebrau Completed properties Freehold – 3.75 9,562 District of Johor Bahru - Residential
Sub-total 361.46 154,318 144 UNITED MALAYAN LAND BHD (4131-M)
List of Properties
AS AT 31 DECEMBER 2009
Description & Age of Net Book Date of Last Location Existing Use Tenure Buildings Land Area Value Revaluation Year Acre RM’000 NICHE DEVELOPMENT
SERI BUKIT CEYLON 8 Lorong Ceylon Completed properties Freehold – 0.11 1,091 Off Jalan Raja Chulan 50250 - Commercial Kuala Lumpur Note Investment properties Freehold 4 0.10 1,813 - Commercial
Sub-Total 0.21 2,904
SUASANA BANGSAR Lot 451, Seksyen 096A On-going development Freehold – 0.93 24,272 Note Kuala Lumpur - Residential
SUASANA BUKIT CEYLON PT21 HSD98859 On-going development Freehold – 1.50 39,034 Note Seksyen 19 - Commercial Kuala Lumpur
OTHER LANDBANK Geran 118688 Lot 1197, Vacant land Freehold – 1.49 28,853 Note Geran 118689 Lot 1199 and - Commercial Geran 99571 Lot 1201, District of Johor Bahru
HS(D) No. 97972 Vacant land Freehold – 0.39 9,000 Note PT No. 46, Seksyen 57, - Commercial Kuala Lumpur
Grand total 2,433.89 923,571
Note: There has been no revaluation since the date of acquisition UNITED MALAYAN LAND BHD (4131-M) 145
Analysis of Shareholdings AS AT 30 APRIL 2010
Authorised Share Capital : RM500,000,000
Issued and Paid-Up Share Capital : RM241,705,233
Class of Shares : Ordinary Shares Of RM1.00 Each
Voting Rights : One Vote Per Ordinary Share
DISTRIBUTION OF SHAREHOLDERS
Size of Shareholders No. of Shareholders % of Shareholders No. of shares % of share capital 1 - 99 75 4.76 1,901 0.00 100 - 1,000 321 20.37 255,448 0.11 1,001 - 10,000 888 56.35 3,821,176 1.58 10,001 - 100,000 228 14.47 6,987,850 2.90 100,001 to less than 60 3.81 89,344,424 37.03 5% of issued shares 5% and above of issued shares 4 0.25 140,892,634 58.39 TOTAL 1,576 100.00 241,303,433 100.00
DIRECTORS’ SHAREHOLDINGS
Direct Interest Indirect Interest No. of Shares % No. of Shares % Dato’ Ng Eng Tee 6,525,000 2.70 28,967,234 *a 12.0 Datuk Syed Ahmad Khalid Bin Syed Mohammed 10,000 0.00 – – Ng Eng Soon 7,151,032 2.96 17,828,634*b 7.39
Notes:- a Deemed interested by virtue of his interests in Chee Tat Holdings (S) Pte Ltd, King George Financial Corporation, Netson Investments Ltd pursuant to Section 6A of the Companies Act, 1965 and through his spouse and children. b Deemed interested by virtue of his interest in Chee Tat Holdings (S) Pte Ltd pursuant to Section 6A of the Companies Act, 1965 146 UNITED MALAYAN LAND BHD (4131-M)
Analysis of Shareholdings
AS AT 30 APRIL 2010
SUBSTANTIAL SHAREHOLDERS
Direct Interest Indirect Interest List of Substantial Shareholders No. of Shares % No. of Shares % Wawasan Perangsang Mewah Sdn Bhd 57,153,500 23.69 – – Opal Holdings Pte Ltd 48,084,500 19.93 – – Chee Tat Holdings (S) Pte Ltd 17,828,634 7.39 – – Tradewinds Resources Sdn Bhd 17,826,000 7.39 – – Tradewinds Corporation Berhad – – 17,826,000*a 7.39 Perspective Lane (M) Sdn Bhd – – 17,826,000*b 7.39 Restu Jernih Sdn Bhd – – 17,826,000*c 7.39 Tan Sri Dato’ Syed Mokhtar Shah bin Syed Nor – – 17,826,000*d 7.39 Muhammad Nor bin Saliman – – 57,153,500*e 23.69 Azman Hanafi bin Abdullah – – 57,153,500*e 23.69 CapitaLand Residential Malaysia Pte Ltd – – 48,084,500*f 19.93 CapitaLand Commercial Limited – – 48,084,500*g 19.93 CapitaLand Limited – – 50,064,500*h 20.75 Temasek Holdings (Private) Limited – – 50,064,500*i 20.75 Dato’ Ng Eng Tee 6,525,000 2.70 28,967,234*j 12.00 Ng Eng Soon 7,151,032 2.96 17,828,634*k 7.39 Ng Eng Ghee 6,560,864 2.72 17,828,634*k 7.39
Notes: a Deemed interested by virtue of its interest in Tradewinds Resources Sdn Bhd pursuant to Section 6A of the Companies Act 1965. b Deemed interested by virtue of its interest in Tradewinds Corporation Berhad pursuant to Section 6A of the Companies Act, 1965. c Deemed interested by virtue of its interest in Perspective Lane (M) Sdn Bhd pursuant to Section 6A of the Companies Act, 1965. d Deemed interested by virtue of his interest in Restu Jernih Sdn Bhd pursuant to Section 6A of the Companies Act, 1965. e Deemed interested by virtue of their interests in Wawasan Perangsang Mewah Sdn Bhd pursuant to Section 6A of the Companies Act, 1965. f Deemed interested by virtue of its interest in Opal Holdings Pte Ltd pursuant to Section 6A of the Companies Act, 1965. g Deemed interested by virtue of its interest in CapitaLand Residential Malaysia Pte Ltd pursuant to Section 6A of the Companies Act, 1965. h Deemed interested by virtue of its interest in CapitaLand Commercial Limited and CapitaLand Residential Limited via its wholly owned subsidiary, Prime Equities Pte Ltd pursuant to Section 6A of the Companies Act, 1965. i Deemed interested by virtue of its interest in CapitaLand Limited pursuant to Section 6A of the Companies Act, 1965. j Deemed interested by virtue of his interests in Chee Tat Holdings (S) Pte Ltd, King George Financial Corporation, Netson Investments Ltd pursuant to Section 6A of the Companies Act, 1965 and through his spouse and children. k Deemed interested by virtue of their interests in Chee Tat Holdings (S) Pte Ltd pursuant to Section 6A of the Companies Act, 1965.
LIST OF THIRTY LARGEST SHAREHOLDERS
No. Name No. of Shares % of Share Capital 1. Wawasan Perangsang Mewah Sdn Bhd 57,153,500 23.69 2. Opal Holdings Pte Ltd 48,084,500 19.93 3. Chee Tat Holdings (S) Pte Ltd 17,828,634 7.39 4. Public Nominees (Tempatan) Sdn Bhd 17,826,000 7.39 Pledged Securities Account for Tradewinds Resources Sdn Bhd 5. Khong Guan Flour Milling Limited 11,400,000 4.72 UNITED MALAYAN LAND BHD (4131-M) 147
Analysis of Shareholdings
AS AT 30 APRIL 2010
No. Name No. of Shares % of Share Capital 6. Citigroup Nominees (Asing) Sdn Bhd 7,363,782 3.05 Exempt An for OCBC Securities Private Limited 7. HDM Nominees (Asing) Sdn Bhd 6,560,864 2.72 UOB Kay Hian Pte Ltd for Ng Eng Ghee 8. Mayban Nominees (Tempatan) Sdn Bhd 4,516,200 1.87 Mayban Trustee Berhad for Public Regular Savings Fund 9. Amsec Nominees (Asing) Sdn Bhd 4,490,800 1.86 AmTrustee Berhad for King George Financial Corporation 10. Amsec Nominees (Asing) Sdn Bhd 3,939,618 1.63 AmFraser Securities Pte Ltd for Ng Yew Hui 11. Amsec Nominees (Asing) Sdn Bhd 3,939,617 1.63 AmFraser Securities Pte Ltd for Ng Yew Tong 12. Amsec Nominees (Asing) Sdn Bhd 3,939,617 1.63 AmFraser Securities Pte Ltd for Ng Yew Chuan 13. Amsec Nominees (Asing) Sdn Bhd 3,938,210 1.63 AmFraser Securities Pte Ltd for Ng Suat Paik Alice 14. Amsec Nominees (Asing) Sdn Bhd 3,289,000 1.36 Pledged Securities Account for Ng Eng Tee 15. AmanahRaya Trustees Berhad 3,193,000 1.32 Public Far-East Property & Resorts Fund 16. EB Nominees (Tempatan) Sendirian Berhad 3,180,000 1.32 Pledged Securities Account for Ng Eng Tee 17. Victoria Prize Sdn Bhd 3,061,441 1.27 18. Khong Guan Group Pte Ltd 2,830,875 1.17 19. Ng Yew Khim, Dennis 2,200,000 0.91 20. Hup Hock Trading Sendirian Berhad 1,980,750 0.82 21. HDM Nominees (Asing) Sdn Bhd 1,980,000 0.82 DBS Vickers Secs (S) Pte Ltd for Prime Equities Pte Ltd 22. Amsec Nominees (Asing) Sdn Bhd 1,650,000 0.68 AmTrustee Berhad for Netson Investments Ltd 23. AmanahRaya Trustees Berhad 1,316,900 0.55 Public Islamic Opportunities Fund 24. Kah Hong Pte. Limited 1,130,000 0.47 25. Ng Suet Ning, Tammy 1,000,000 0.41 26. Wong Winifred 1,000,000 0.41 27. Taisho Company Sdn Berhad 927,000 0.38 28. AmanahRaya Trustees Berhad 872,000 0.36 Public SmallCap Fund 29. AmanahRaya Trustees Berhad 806,900 0.33 PB Asia Real Estate Income Fund 30. Amsec Nominees (Asing) Sdn Bhd 797,800 0.33 Pledged Securities Account for Ng Yew Khim, Dennis TOTAL 222,197,008 92.08
The Analysis of Shareholdings have been tabulated based on the Company’s Record of Depositors with Bursa Malaysia Depository Sdn Bhd after deducting 401,800 ordinary shares of RM1.00 each bought back by the Company and retained as treasury shares as at 30 April 2010. 148 UNITED MALAYAN LAND BHD (4131-M)
Notice of 49th Annual General Meeting
NOTICE IS HEREBY GIVEN THAT the 49th Annual General Meeting of United Malayan Land Bhd will be held at Nirwana Ballroom 2, Lower Lobby, Crowne Plaza Mutiara Kuala Lumpur, Jalan Sultan Ismail, 50250 Kuala Lumpur, on Wednesday, 23 June 2010 at 10.30 a.m. for the following businesses:-
AS ORDINARY BUSINESS: 1. To receive the Audited Financial Statements for the fi nancial year ended 31 December 2009 together with the Reports of the Directors and Auditors thereon. Ordinary Resolution 1
2. To approve the payment of a fi nal gross dividend of 4.06 sen per ordinary share, less income tax of 25% and a tax exempt dividend of 0.70 sen per ordinary share for the fi nancial year ended 31 December 2009. Ordinary Resolution 2
3. To re-elect the following Directors, each of whom retires by rotation in accordance with Article 94 of the Company’s Articles of Association:- i) YBhg Dato’ Ng Eng Tee Ordinary Resolution 3 ii) Tuan Syed Azmin bin Mohd Nursin @ Syed Nor Ordinary Resolution 4
4. To consider and if thought fi t, to pass the following resolution:- “THAT pursuant to Section 129(6) of Companies Act 1965, YABhg Tun Musa Hitam be and is hereby re-appointed as a Director of the Company to hold offi ce until the next Annual General Meeting of the Company.” Ordinary Resolution 5
5. To approve the payment of Directors’ fees for the fi nancial year ended 31 December 2009. Ordinary Resolution 6
6. To re-appoint PricewaterhouseCoopers as Auditors of the Company for the ensuing year and to authorise the Directors to fi x their remuneration. Ordinary Resolution 7
AS SPECIAL BUSINESS: To consider, and if thought fi t, to pass the following ordinary resolutions:- 7. AUTHORITY TO ISSUE SHARES PURSUANT TO SECTION 132D OF THE COMPANIES ACT, 1965 “THAT subject always to the Companies Act, 1965, (the Act) the Company’s Articles of Association and approvals of the relevant government and/or regulatory authorities, the Directors be and are hereby empowered pursuant to Section 132D of the Act to issue and allot new shares in the Company at any time at such price, upon such terms and conditions and for such purposes and to such person(s) whomsoever as the Directors may in their absolute discretion deem fi t and expedient in the interest of the Company, provided that the aggregate number of shares to be issued does not exceed 10% of the total issued share capital of the Company for the time being and THAT the Directors be and are also empowered to obtain the approval from Bursa Malaysia Securities Berhad (Bursa Securities) for the listing of and quotation for the new shares so issued and THAT such authority shall continue to be in force until the conclusion of the next Annual General Meeting (AGM) of the Company.” Ordinary Resolution 8
8. PROPOSED RENEWAL OF SHAREHOLDERS’ MANDATE FOR SHARE BUY-BACK “THAT subject to Section 67A of the Act, Part IIIA of the Companies Regulations 1966, provisions of the Company’s Memorandum and Articles of Association, Bursa Securities Main Market Listing Requirements (Listing Requirements) and any other applicable laws, rules, regulations and guidelines for the time being in force, the Directors of the Company be and are hereby authorised to make purchase(s) of ordinary shares of RM1.00 each in the Company’s issued and paid-up capital on Bursa Securities subject to the following:-
UNITED MALAYAN LAND BHD (4131-M) 149
Notice of 49th Annual General Meeting
i) the maximum number of shares which may be purchased and/or held by the Company shall not exceed 5,800,000 ordinary shares of RM1.00 each or approximately 2.40% of the issued and paid- up share capital of the Company (Shares) for the time being;
ii) the maximum fund to be allocated by the Company for the purpose of purchasing the Shares shall not exceed the aggregate of the retained profi ts and share premium account of the Company. As at 31 December 2009, the audited retained profi ts and share premium account of the Company were RM87,616,817 and RM63,970,442 respectively;
iii) the authority conferred by this resolution will commence immediately upon passing of this ordinary resolution and, unless renewed by an ordinary resolution passed by the shareholders of the Company in general meeting will expire:- (a) at the conclusion of the next AGM of the Company, unless earlier revoked or varied by ordinary resolution of the shareholders of the Company in general meeting; or (b) upon the expiration of the period within which the next AGM after that date is required by the law to be held, whichever occurs fi rst, but not so as to prejudice the completion of purchase(s) by the Company before the aforesaid expiry date and in any event, in accordance with the provisions of the Listing Requirements or any other relevant authority; and
iv) upon completion of the purchase(s) of the Shares by the Company, the Directors of the Company be and are hereby authorised to deal with the Shares in the following manner:- (a) cancel the Shares so purchased; or (b) retain the Shares so purchased as treasury shares; or (c ) retain part of the Shares so purchased as treasury shares and cancel the remainder; or (d) distribute the treasury shares as share dividends to shareholders and/or resell on Bursa Securities and/or cancel all or part of them; or
in any other manner as prescribed by the Act, rules, regulations and guidelines pursuant to the Act and the requirements of Bursa Securities and any other relevant authority for the time being in force;
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 effect the purchase(s) of the Shares with full power to assent to any condition, modifi cation, variation and/or amendment as may be imposed by the relevant authorities and to take all such steps as they may deem necessary or expedient in order to implement, fi nalise and give full effect in relation thereto.” Ordinary Resolution 9
9. PROPOSED RENEWAL OF SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS “THAT, approval be and is hereby given to the Company to renew its shareholders’ mandate for the Company and/or its subsidiaries to enter into and give effect to specifi c recurrent related party transactions of a revenue or trading nature which are necessary for its day-to-day operations involving the Related Parties, as set out in Section 2.1.4 of Part B of the Circular to Shareholders dated 1 June 2010 (Circular) subject to the following: (a) the transactions are carried out at arm’s length, on normal commercial terms which are not more favourable to the Related Parties than those generally available to the public and are not to the detriment of the minority shareholders of the Company; 150 UNITED MALAYAN LAND BHD (4131-M)
Notice of 49th Annual General Meeting
(b) disclosure is made in the annual report of the aggregate value of transactions conducted pursuant to the shareholders’ mandate during the fi nancial year and such approval shall continue to be in force until:- (i) the conclusion of the next AGM of the Company, at which time it will lapse, unless by a resolution passed at the said AGM, the authority is renewed; (ii) the expiration of the period within which the next AGM of the Company is required to be held pursuant to Section 143 (1) of the Act but shall not extend to such extension as may be allowed pursuant to Section 143 (2) of the Act; or (iii) revoked or varied by resolution passed by the shareholders in general meeting;
whichever is the earlier;
AND THAT the Directors of the Company be empowered to complete and do all such acts and things as they may consider expedient or necessary to give effect to the transactions contemplated and/or authorised by this resolution.” Ordinary Resolution 10
10. PROPOSED RENEWAL OF GENERAL MANDATE FOR THE PROVISION OF FINANCIAL ASSISTANCE “THAT approval be and is hereby given for the renewal of a general mandate to the Company and/or its subsidiaries to provide/procure recurring fi nancial assistance on a short term basis to/from its non-wholly owned subsidiaries and jointly controlled entities via the pooling of funds, as set out in Section 2.2.3 of Part B of the Circular subject to the following: (a) the transactions are fair and reasonable to the Company; (b) the transactions are not to the detriment of the Company and its shareholders; and (c) disclosure is made in the annual report of the aggregate value of transactions conducted pursuant to the general mandate during the fi nancial year and such approval shall continue to be in force until:- (i) the conclusion of the next AGM of the Company, at which time it will lapse, unless by a resolution passed at the said AGM, the authority is renewed; (ii) the expiration of the period within which the next AGM of the Company is required to be held pursuant to Section 143 (1) of the Act but shall not extend to such extension as may be allowed pursuant to Section 143 (2) of the Act; or (iii) revoked or varied by resolution passed by the shareholders in a general meeting;
whichever is the earlier;
AND THAT the Directors of the Company be empowered to complete and do all such acts and things as they may consider expedient or necessary to give effect to the transactions contemplated and/or authorised by this resolution.” Ordinary Resolution 11
11. To transact any other business of the Company for which due notice shall have been received in accordance with the Act. UNITED MALAYAN LAND BHD (4131-M) 151
Notice of 49th Annual General Meeting
NOTICE OF ENTITLEMENT AND PAYMENT OF FINAL DIVIDEND NOTICE IS HEREBY GIVEN THAT the fi nal gross dividend of 4.06 sen per ordinary share, less income tax of 25% and a tax exempt dividend of 0.70 sen per ordinary share for the financial year ended 31 December 2009, if approved by the shareholders at the 49th AGM, will be paid on 7 September 2010 to all shareholders whose names appear in the Record of Depositors of the Company with Bursa Malaysia Depository Sdn Bhd at the close of business on 23 August 2010.
The entitlement to the dividend shall only be in respect of the following:- A) Shares transferred into the Depositor’s Securities Account on or before 4.00 p.m. on 23 August 2010 in respect of ordinary transfers; and
B) Shares bought on Bursa Malaysia Securities Berhad on a cum entitlement basis according to the Rules of Bursa Malaysia Securities Berhad.
BY ORDER OF THE BOARD
ZURAIDAH MOHD YUSOFF MAICSA 7001552 Company Secretary
Kuala Lumpur 1 June 2010
DIRECTOR TO RETIRE AT THE 49TH AGM Pursuant to Article 99 of the Articles of Association of the Company, Ms Hazel Chew Siew Cheng will be retiring at the 49th AGM. Ms Hazel Chew Siew Cheng has advised that she does not wish to seek for re-election at the said meeting. NOTES: 1. Proxy • A member may appoint any person to be his proxy and the provisions of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company. • If a member appoints two (2) proxies to attend at the same meeting, the appointment(s) shall be invalid unless he specifi es the proportion of his holdings to be represented by each proxy. • The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorized or, if the appointor is a corporation, either under its seal or under the hand of an offi cer duly authorized. • The instrument appointing a proxy must be deposited at the Company’s Share Registrar, Securities Services (Holdings) Sdn Bhd at Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur not less than forty-eight (48) hours before the time set for holding the meeting or any adjournment thereof. 2. Ordinary Resolution 8 Authority to Directors to Issue Shares Ordinary Resolution 8, if passed, will give the fl exibility to the Directors to allot and issue new ordinary shares in the capital of the Company up to an aggregate amount not exceeding 10% of the issued and paid-up share capital of the Company for the time being without having to convene a separate general meeting. This authority, unless revoked or varied at a general meeting, will expire at the conclusion of the next AGM of the Company.
At this juncture, no new shares were issued pursuant to the authority granted to the Directors at the 48th AGM held on 24 June 2009. 3. Ordinary Resolution 9 Proposed Renewal of Shareholders’ Mandate for Share Buy-Back Further information on Ordinary Resolution 9 is set out under Part A of the Circular to Shareholders dated 1 June 2010 despatched together with the Company’s Annual Report 2009. 4. Ordinary Resolution 10 Proposed Renewal of Shareholders’ Mandate for Recurrent Related Party Transactions Further information on Ordinary Resolution 10, is set out under Part B of the Circular to Shareholders dated 1 June 2010 despatched together with the Company’s Annual Report 2009. 5. Ordinary Resolution 11 Proposed Renewal of General Mandate for the Provision of Financial Assistance Further information on Ordinary Resolution 11 is set out under Part B of the Circular to Shareholders dated 1 June 2010 despatched together with the Company’s Annual Report 2009. Statement Accompanying the Notice of Annual General Meeting Additional information pursuant to Paragraph 8.28(2) of the Listing Requirements is set out in Annexure A of the Company’s Annual Report 2009. 152 UNITED MALAYAN LAND BHD (4131-M)
ANNEXURE A Statement Accompanying Notice of 49th Annual General Meeting (Pursuant to Paragraph 8.28(2) of the Listing Requirements)
Directors who are standing for re-election and re-appointment at the 49th AGM of the Company are:-
1. RE-ELECTION PURSUANT TO ARTICLE 94 OF THE COMPANY’S ARTICLES OF ASSOCIATION:- a) YBhg Dato’ Ng Eng Tee (Ordinary Resolution 3) b) Tuan Syed Azmin bin Mohd Nursin @ Syed Nor (Ordinary Resolution 4)
2. RE-ELECTION PURSUANT TO ARTICLE 99 OF THE COMPANY’S ARTICLES OF ASSOCIATION:- Ms Hazel Chew Siew Cheng who will be retiring pursuant to Article 99 of the Company’s Articles of Association has advised that she does not wish to seek for re-election at the 49th AGM.
3. RE-APPOINTMENT PURSUANT TO SECTION 129(6), COMPANIES ACT, 1965 a) YABhg Tun Musa Hitam (Ordinary Resolution 5)
Please refer to the Profi le of the Board of Directors disclosed in the Company’s Annual Report 2009 for further information on the abovenamed Directors who are standing for re-election and re-appointment.
Four (4) scheduled Board Meetings and one (1) Special Board Meeting were held during the fi nancial year ended 31 December 2009. Details of the Directors’ attendance are disclosed under the Corporate Governance Statement in the Company’s Annual Report 2009.
The place, date and time of the 49th AGM of the Company are as follows:-
Place : Nirwana Ballroom 2 Lower Lobby Crowne Plaza Mutiara Kuala Lumpur Jalan Sultan Ismail 50250 Kuala Lumpur
Date & Time : Wednesday, 23 June 2010 at 10.30 a.m Form of Proxy (Company No. 4131-M) (Incorporated in Malaysia) No. of Shares
I/We NRIC No./Company No. (Name*) of (Full address) being a member of United Malayan Land Bhd hereby appoint the Chairman of the Meeting or the following person(s) (delete whichever is not applicable) as my/our proxy/proxies to attend and vote for me/us and on my/our behalf, at the 49th Annual General Meeting of the Company, to be held on Wednesday, 23 June 2010 at 10.30 a.m. at Nirwana Ballroom 2, Lower Lobby, Crowne Plaza Mutiara Kuala Lumpur, Jalan Sultan Ismail, 50250 Kuala Lumpur or at any adjournment thereof:-
Name NRIC No. Shares to be represented by Proxy (%) First Proxy Second Proxy
My/our proxy/proxies is/are to vote as indicated below:
First Proxy Second Proxy Ordinary Resolutions For Against For Against 1. To receive the Audited Financial Statements for the year ended 31 December 2009 2. To approve fi nal gross dividend of 4.06 sen less tax and tax exempt dividend of 0.70 sen for fi nancial year 2009 3. To re-elect Director - Dato’ Ng Eng Tee 4. To re-elect Director - Syed Azmin bin Mohd Nursin @ Syed Nor 5. To re-appoint Director - Tun Musa Hitam 6. To approve Directors’ fees for fi nancial year 2009 7. To re-appoint PricewaterhouseCoopers as Auditors and authorise Directors to fi x remuneration 8. To authorize Directors to issue Shares pursuant to Section 132D of Companies Act, 1965 9. To approve the Proposed Renewal of Shareholders’ Mandate for Share Buy-Back 10. To approve the Proposed Renewal of Shareholders’ Mandate for Recurrent Related Party Transactions 11. To approve the Proposed Renewal of General Mandate for the Provision of Financial Assistance
Please indicate with an “X” in the spaces provided above as how you wish your vote to be cast. If you do not do so, the proxy will vote or abstain from voting at his discretion.
* Name as per NRIC/Passport/Certifi cate of Incorporation in capital letters.
Dated: Signature/Seal
NOTES • A member may appoint any person to be his proxy and the provisions of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company. • If a member appoints two (2) proxies to attend at the same meeting, the appointment(s) shall be invalid unless he specifi es the proportion of his holdings to be represented by each proxy. • The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised in writing or, if the appointor is a corporation, either under its seal or under the hand of an offi cer duly authorised. • The instrument appointing a proxy must be deposited at the Company’s Share Registrar, Securities Services (Holdings) Sdn Bhd at Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur not less than forty-eight (48) hours before the time set for holding the meeting or any adjournment thereof. fold here
STAMP
Share Registrar
United Malayan Land Bhd C/O Securities Services (Holdings) Sdn Bhd Level 7, Menara Milenium, Jalan Damanlela Pusat Bandar Damansara, Damansara Heights 50490 Kuala Lumpur
fold here Group Directory
United Malayan Land Bhd (4131-M) Bangi Heights Development Sdn Bhd Sales & Marketing Contacts Suite 1.1, 1st Floor (236433-V) for Niche Development Kompleks Antarabangsa 34, Jalan Seri Putra 1/2 Suasana Bangsar Jalan Sultan Ismail Bandar Seri Putra, Bangi Tel : 03-2142 1611 50250 Kuala Lumpur, Malaysia 43000 Kajang Fax : 03-2141 4541 Selangor Darul Ehsan, Malaysia Tel : 03-2142 1611 Email : [email protected] Fax : 03-2142 1826 Project : Bandar Seri Putra Website : http://www.suasanabangsar.com.my Email : [email protected] Tel : 03-8927 1611 (shareholder enquiries) Fax : 03-8927 1811 Suasana Bukit Ceylon [email protected] Email : [email protected] Tel : 03-2142 1611 (general enquiries) Website : http://www.umland.com.my Fax : 03-2141 4541 Website : http://www.umland.com.my Email : [email protected]
Seri Alam Properties Sdn Bhd (41628-A) Dynasty View Sdn Bhd (644369-M) Teratak Seri Alam Seri Austin, Jalan Seri Austin 1 6, Jalan Lembah Taman Seri Austin Bandar Seri Alam 81100 Johor Bahru 81750 Johor Darul Ta’zim, Malaysia Johor Darul Ta’zim, Malaysia Project : Bandar Seri Alam Project : Taman Seri Austin Tel : 07-388 1111 Tel : 07-354 1111 Fax : 07-388 1100 Fax : 07-351 3202 Email : [email protected] Email : [email protected] Website : http://www.umland.com.my Website : http://www.umland.com.my United Malayan Land Bhd (4131-M) Suite 1.1, 1st Floor Kompleks Antarabangsa Jalan Sultan Ismail 50250 Kuala Lumpur Malaysia Tel : (603) 2142 1611 Fax : (603) 2142 1826 Website : www.umland.com.my