UEM EDGENTA BERHAD UEM EDGENTA Empowered by Science, Inspired by Humans (5067-M) UEM EDGENTA BERHAD (5067-M) Level 17, Menara UEM Tower 1, Avenue 7 The Horizon, Bangsar South City No. 8, Jalan Kerinchi 59200 Kuala Lumpur Tel: +603 2725 6688 Fax: +603 2725 6888 Orchestrate Collaborate Perform Annual Report 2015 www.uemedgenta.com ANNUAL REPORT TWENTY FIFTEEN INSIDE THIS ANNUAL GENERAL MEETING OF UEM EDGENTA BERHAD Date : Thursday, 12 May 2016 Time : 10.00 am Venue : Banquet Hall Menara Korporat, Persada PLUS Persimpangan Bertingkat Subang KM15, Lebuhraya Baru Lembah Klang 47301 Petaling Jaya Selangor Darul Ehsan Transparency 092 Statement on Corporate Governance 109 Statement on Risk Management and Internal Control 117 Audit and Risk 039 Group Statement of Committee Report About Value Added UEM Edgenta 040 Group Financial Calendar Financial Review 004 2015 Key Highlights 041 Investor Relations 005 Our Vision/Mission/ 125 Financial Statements 045 Employees & Values Productivity 006 UEM Edgenta at a Accountability Glance 008 Our Presence Corporate 267 Analysis of 010 Company Profile Framework Shareholdings 014 Our Services 270 Properties Held by the 046 Corporate Structure Group 048 Organisation Chart 272 Additional Compliance Striving 050 Corporate Information Information for Growth 052 Group Milestones 273 Recurrent Related Party 056 2015 Event Highlights Transactions 018 Chairman’s Statement rd 062 Media Highlights 286 Notice of the 53 022 Operations Review by 064 Awards and Annual General Managing Director/ Recognition Meeting Chief Executive Officer 290 Statement Accompanying Leadership rd Performance Notice of the 53 066 Board of Directors Annual General Review 068 Board of Directors’ Meeting 035 5-Year Group Financial Profile Highlights 076 Senior Management • Form of Proxy 036 5-Year Group Financial Team • Group Directory Summary 038 2015 Group Quarterly Key Initiatives Performance 078 Our Commitment to Responsible Corporate Practices REVENUE NORMALISED PBT* 1.1% to 17.4% to RM3.12 billion RM350.8 million (FY2014: RM3.09 billion) (FY2014: RM298.8 million) NORMALISED PATANCI* NET TANGIBLE ASSET PER SHARE 19.4% to 29.8% to RM223.2 million RM1.09 (FY2014: RM186.9 million) (FY2014: RM0.84) DIVIDEND TO SHAREHOLDERS RM122.0 million representing payout ratio of 64% (FY2014: RM187.1 million) * Normalised PBT and PATANCI are derived after excluding one-off costs for Mutual Separation Scheme, goodwill impairment for Opus Steward Weir (“OSW”) in Canada and the reversal of deferred consideration rising from the acquisition of OSW by Opus International Consultants Ltd. • Listed in FTSE4Good Bursa Malaysia Index for strong Environmental, Social and Governance Practices • Awarded 2015 Frost & Sullivan Asia Pacific Integrated Facilities Management Competitive Strategy Innovation & Leadership Award • Listed in Forbes Asia’s “Best Under A Billion” 2015 • Received Special Mention under the Best Project Award (Infrastructure Project – Major) by the Malaysian Construction Industry Excellence Award 2015 (MCIEA) for the Electrified Double Track Project between Ipoh and Padang Besar. 2015KEY HIGHLIGHTS 004 OPTIMISING ASSETS TO IMPROVE LIVES. viSION OUR SERVICES, COMMITMENT TO SMARTER THINKING AND IMPROVED SOLUTIONS PLACE US AT THE FOREFRONT OF THE INDUSTRY. WE CREATE OPPORTUNITIES FOR CLIENTS AND ASSETS THAT POSITIVELY INFLUENCE SOCIETY. mission WE ARE AN ENTERPRISING ENTITY THAT EMBRACES TEAMWORK, INTEGRITY AND OURPASSION WITH A FOCUS ON SUCCESS. VALUES The key elements of our values ENTERPRISING TEAMWORK INTEGRITY PASSION SUCCESS We are enterprising We practice teamwork, We hold true to We are passionate, We achieve success by and competitive with mutual respect, open ethical and professional driven, competent and pushing boundaries, a mind-set geared communications and behaviour to set the committed to gain thinking creatively towards creating empowerment while highest standards of knowledge and resulting with out-of- greater value for our embracing diversity integrity, honesty and improve skill sets to the-box innovative stakeholders. and inclusiveness to trust. achieve personal ideas and solutions. foster internal and growth and external collaborations. exceptional performance. UEm Edgenta more than Combined experience of more than 13,000 75 years strong workforce in the AFM business WORLDWIDE One of the region’s largest FY15 Shareholder’s Total Asset Fundof Solutions entity with group assets of RM >RM2.6 1.3 billion billion 006 at A glance UEM EDGENTA BERHAD International Market Capitalisation of presence in RM2.97 10 billion COUNTRIES as at 31.3.2016 ANNUAL REPORT 2015 UEM Edgenta of Bursa Malaysia is listed on THE Main Market Securities Berhad and Opus International Consultants Limited New Zealand is listed on the Stock Exchange 007 INTERNATIONAL PRESENCE IN 10 COUNTRIES SPANNING ACROSS 7 MAJOR REGIONS 10 08 09 OUR PRESENCE 008 UEM EDGENTA BERHAD 06 07 05 04 03 ANNUAL REPORT 2015 02 01. New Zealand (NZ) 01 02. Australia (AUS) 03. Indonesia (INDO) 04. Malaysia (MAS) 05. India (IND) 06. Saudi Arabia (ARB) 07. United Arab Emirates (UAE) 08. United Kingdom (UK) 09. United States (USA) 10. Canada (CAN) 009 Asset Consultancy Healthcare Services Infra Services Facilities Services Industrial Services Energy Services Property Services Environmental & Material Testing Services Property Development COMPANY 010 PROFILE UEM EDGENTA BERHAD UEM Edgenta Berhad (“UEM Edgenta”) is one of the region’s largest Total Asset Solutions entity. Listed on the Main Market of Bursa Malaysia Securities Berhad with market capitalisation of RM2.97 billion as at 31 March 2016, we are a leader in Total Asset Solutions with businesses providing Asset Consultancy, Healthcare Services, Infra Services, Facilities Services, Industrial Services, Energy Services, Property Services, Environmental & Material Testing Services and Property Development. We offer the healthcare, infrastructure and real estate sectors a full suite of services throughout the asset life cycle. These include consultancy, procurement and construction planning, operations and maintenance, as well as optimisation, rehabilitation and upgrades. Our combined expertise and our ability to provide end-to-end solutions creates opportunities for both our clients and ourselves. Innovation is at the heart of what we do. It leads us to offer smarter answers to a wide and varied array of asset and infrastructure questions. We aim to set new industry benchmarks and optimise our clients’ assets throughout their life cycle. ANNUAL REPORT 2015 UEM Edgenta has developed standards of practice that are recognised and adopted by the industry in several countries and multilateral agencies such as the World Bank and the Asian Development Bank. Our global presence and internal knowledge sharing networks enable us to share and apply our wealth of experience and expertise collaboratively across multiple disciplines. We are able to be there for our clients throughout the entire asset life cycle because accessibility, understanding and collaboration are our trademarks. We are our clients’ advisors and partners from the very first assets blueprint, right up to the management and maintenance of the day-to-day operations of the assets. 011 nstruc ASSET LIFE CYCLE Co tion ng bility ni P ina io r sta s oc u s u S Renewa i r & l e h m t e m w d m e a o o r n r g C t G p U n g n i s o i e t a D t i l i b a h g e n R i n n la n P O io p t C ra on n ti e ce tio m p ptualisa i O sa tio n ce Maintenan 012 UEM EDGENTA COMPRISES 8 BUSINESSES WHICH COVER THE ENTIRE ASSET LIFE CYCLE UEM EDGENTA BERHAD 1. Asset Consultancy 2. Healthcare Services 3. Infra Services 4. Facilities Services 5. Industrial Services 6. Energy Services 7. Property Services 8. Environmental & Material Testing Services Re newa g Construc de l nin tio ra io n g ss p i U m P ro m c o u C r n e o m i t e a n t i t l ANNUAL REPORT 2015 i b a h e n R y g i t s i l e i O D b p a t in im a n t is io g s a t n u t ra ni S io pe n n O Co la & nc P th Mai e ept w ntenanc ualisation Gro 013 Our Services 1. ASSET CONSULTANCY We are internationally certified to provide Total Asset Our Asset Consultancy capabilities span across various Solutions for healthcare institutions. As a key player in sectors such as transport, buildings, water and this segment, we have had the privilege of serving environment with a firm foothold in Malaysia, New over 82 hospitals and various healthcare institutions in Zealand, Australia, United Kingdom, Middle East, Malaysia for the past 19 years. We also operate in the Canada and the United States. India healthcare sector via a joint venture. With over two decades of experience in the industry, Our Capabilities and Offerings: we have undertaken major projects for over 12,000 • Biomedical Engineering Maintenance Services clients worldwide in the Expressways and Highways, • Facilities Engineering Maintenance Services Built Environment, Airports and Railways as well as • Healthcare Waste Management Services Utilities sectors. • Linen and Laundry Services • Cleansing Services Our Capabilities and Offerings: • Facilities Management Services • Engineering and Consultancy Services • Sustainability Programmes • Project Management Services • Value Engineering • Asset Management Consultancy • Procurement and Contracts Management • Geographic Information Systems • Asset Management Information System • Integrated Asset and Facility Management Services 2. HEALTHCARE SERVICES From biomedical engineering maintenance to waste management and linen and laundry services, the team at UEM Edgenta understands the demands of the healthcare industry. 014 UEM EDGENTA BERHAD 3. INFRA SERVICES 5. INDUSTRIAL SERVICES With over 25 years of experience in highway maintenance, UEM Edgenta collaborates with industry partners to UEM Edgenta has solidified its reputation as one of undertake engineering projects in the Oil & Gas Malaysia’s leading Engineering and Infrastructure sector. We provide asset maintenance, operations Maintenance Specialists.